STAFF REPORT: INITIAL STATEMENT OF REASONS FOR PRO POSED RULEMAKING

PROPOSED AMENDMENTS TO THE REGULATION FOR IN-USE OF F-ROAD DIESEL-FUELED FLEETS AND IMPLEMENTATION UPDATE

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

December 2008State of California AIR RESOURCES BOARD

STAFF REPORT: INITIAL STATEMENT OF REASONS

Public Hearing to Consider

PROPOSED MODIFICATIONS TO THE REGULATION FOR IN-USE OFF-ROAD

DIESEL-FUELED FLEETS AND IMPLEMENTATION UPDATE

To be considered by the Air Resources Board at a me eting of the Board that will commence on January 22, 2009, and may continue to J anuary 23, 2009, at

California Environmental Protection Agency

Air Resources Board Byron Sher Auditorium 1001 I Street Sacramento, California 95814

Mobile Source Control Division: Robert Cross, Chief

Heavy-Duty Diesel In-Use Strategies Branch:

Erik White, Chief

Off-Road Implementation Section: Kim Heroy-Rogalski, Manager

This report has been prepared by the staff of the A ir Resources Board. Publication does not signify that the contents reflect the view s and policies of the Air Resources Board, nor does mention of trade names or commercia l products constitute endorsement or recommendation for use.State of California AIR RESOURCES BOARD

PROPOSED MODIFICATIONS TO THE REGULATION FOR IN-USE OFF-ROAD

DIESEL-FUELED FLEETS AND IMPLEMENTATION UPDATE

Contributing Authors

Elizabeth Yura Michael Baker Eric Brown Cory Parmer Elizabeth White Jeff Wilson

Legal Counsel

Michael Terris, Office of Legal Affairs

Supporting Divisions

Mobile Source Operations Division Planning and Technical Support Division

Research Division Stationary Source Division

Acknowledgements

This report was prepared with the assistance and su pport from the other divisions and offices of the Air Resources Board. In addition, w e would like to acknowledge the assistance and cooperation that we have received fr om many individuals and organizations.TABLE OF CONTENTS

EXECUTIVE SUMMARY ..................................

................................................... ........... 1

I. INTRODUCTION .......................................

................................................... ............ 9

A. Background .........................................

................................................... .............. 9
B. Report Overview....................................

................................................... ............ 9

II. TECHNOLOGY UPDATE..................................

................................................... .. 11

A. ARB’s Verification Program .........................

................................................... .... 11
B. Status of Current Off-Road Verifications ........... ................................................. 11
C. Status of Current Off-road Demonstration Programs.. ........................................ 14
D. Total Number of VDECS installations................ ................................................. 19
E. Cost of Verified Diesel Emission Control Strategies ........................................... 20
F. VDECS Safety.......................................

................................................... .......... 21

III. IMPLEMENTATION UPDATE.............................. .................................................. 2 3

A. Public Outreach....................................

................................................... ........... 23
B. Off-road Implementation Advisory Group ............. .............................................. 25
C. SOON Program Status ................................

................................................... .... 25
D. DOORS ..............................................

................................................... ............. 26
E. Enforcement Actions and Fines Issued ............... ............................................... 28
F. Waiver Status ......................................

................................................... ............ 28

IV. PROPOSED MODIFICATIONS TO THE REGULATION FOR IN-USE OFF-ROAD DIESEL-FUELED FLEETS...............................

................................................... ... 31

A. Regulatory Authority...............................

................................................... ......... 31
B. Public Process.....................................

................................................... ............ 31
C. Need for Modifications.............................

................................................... ........ 32
D. Proposed Modifications .............................

................................................... ...... 33
E. Staff Recommendation ...............................

................................................... ..... 35

V. ECONOMIC IMPACTS...................................

................................................... ..... 37

A. Legal Requirements .................................

................................................... ....... 37
B. Methodology........................................

................................................... ............ 37
C. Economic Impacts of Proposed Modifications ......... ........................................... 38
D. Impacts on California Economy......................

................................................... . 39
E. Potential Impacts on Small Businesses.............. ................................................ 39
F. Potential Impacts on Public Agencies............... .................................................. 3 9

VI. ENVIRONMENTAL IMPACTS .............................. ................................................. 41ii

A. Legal Requirements .................................

................................................... ....... 41
B. Air Quality Impacts of Proposed Modifications ...... ............................................. 41
C. Future Evaluation of Current Economic Conditions on Emissions...................... 42
D. Other Environmental Impacts ........................

................................................... .. 42

VII. ALTERNATIVES CONSIDERED ............................ ............................................... 43

A. Extend Early Credit Deadline, but for Less Time.... ............................................ 43
B. Extend Early Credit Deadline by a Full Year ........ .............................................. 43
C. Give More or Less than Double Credit before March 1 , 2010 ............................ 43
D. No Change ..........................................

................................................... ............ 44

VIII. REFERENCES .........................................

................................................... ........... 45iii APPENDICES

APPENDIX A: PROPOSED REGULATION ORDER FOR IN-USE OFF-ROAD

DIESEL-FUELED FLEETS

APPENDIX B: ASSUMPTIONS FOR STATEWIDE FLEET RETROFITTING

ANALYSIS

APPENDIX C: SHOWCASE AND SEP

APPENDIX D: OUTREACH SUMMARY

APPENDIX E: DOORS ON-LINE USER-GUIDES

APPENDIX F: LIST OF ACRONYMSivv LIST OF TABLES Table 1: Currently Verified Level 3 Off-Road DPFs .. ................................................ 12 Table 2: SEP Funding and Number of Engines Retrofit ted ..................................... 17 Table 3: Snowcat Project Locations and Number of Ve hicles ................................ 18 Table 4: Summary of Active VDECS Costs in 2008..... ............................................. 20vivii LIST OF FIGURES Figure 1: Showcase Installations of DECS ...........

................................................... . 16 Figure 2: DOORS Screenshot .........................

................................................... ........ 27 Figure 3: Vehicle Labeled with EIN.................

................................................... ........ 28 Figure 4: Breadth of Passive Level 3 Verifications by Fleet Hp 2008 ..................... 33 Figure 5: California Off-Road Diesel Vehicle Fuel C onsumption............................ 42viii1

EXECUTIVE SUMMARY
What is the purpose of this report?

This report serves several purposes. First, it des cribes proposed changes to the regulation for in-use off-road diesel fueled-fleets (the regulation). These amendments are limited and include extending the deadline for double credit for early particulate matter (PM) retrofits and several additional minor modifications that clarify the regulation.

Second, when the Air Resources Board (ARB or Board) approved the regulation on July 26, 2007, the Board directed staff to provide the B oard a technology update report by January 2009 (ARB, 2007d). This report serves as t hat technology update.

Finally, this report updates the Board on how imple mentation of the regulation has proceeded in the year and a half since the regulati on was approved by the Board. It summarizes the public outreach and reporting work t hat staff has done, and provides a status report on the Surplus Off-road Opt-in for NO x (SOON) program.

What modifications to the regulation is staff propo sing?

To provide additional flexibility and clarity to th e regulation, staff is proposing the following changes to the regulation:

• Extend the deadline for double credit for early PM retrofits by 10 months, from March 1, 2009, to January 1, 2010. This will also mean that fleets that ordered verified diesel emission control systems (VDECS) by September 1, 2009, would receive double credit even if their installation is delayed beyond January 1, 2010.

• Modify the changing fleet size requirements to not penalize fleets that change their designation from small fleets to larger fleet s, and then subsequently become a small fleet again;

• Clarify that all sellers, not just dealers, of off -road vehicles must maintain records of the disclosure of regulation applicability;

• Clarify that the provision providing a delay for t he turnover of Tier 1 and newer vehicles from the turnover requirements of the regu lation applies only through the March 1, 2012 compliance deadline. This is consiste nt with staff’s original intent for this provision; and

• Clarify the reporting requirements for VDECS.

Why should the deadline for early double PM credit be extended?

In originally providing this double credit in the r egulation, staff intended to provide an incentive for fleets to take early action and achie ve early PM reductions. The double credit provisions were also intended to help fleets spread out their costs by reducing the annual number of retrofits they would need to perfo rm in the regulation’s first compliance years. However, because it has taken lon ger than anticipated for additional2

diesel particulate filters (DPFs), especially passi ve DPFs, to become verified, many fleets have been unable to take full advantage of t he early credit provisions.

Why should the other modifications be made?

Since the regulation was adopted, in talking with a ffected fleets and stakeholders, ARB staff has determined that several sections of the r egulation require clarification.

What are the emissions impacts of the proposed modi fications?

Staff expects there to be little to no overall adve rse impact on emissions from the proposed modifications. While the proposed change to extend the deadline for early double PM credit may also have a small disbenefit a s many fleets take advantage of the extended double credit provisions (thereby decreasi ng the total number of retrofits completed by March 1, 2010), evidence from a number of sources indicates that many of the industries affected by the regulation (prima rily the residential construction, rental, and airline industries) have reduced their activity since the regulation was adopted due to the current economic downturn, thereby potential ly offsetting this impact. Available fuel use data supports this, showing total off-road diesel fuel consumption from all sources (off-road vehicles, locomotives, marine, et c.) down over 10 percent from year 2007 levels (BOE, 2008). However, staff cannot pre cisely quantify at this time the extent of the decline in emissions from off-road ve hicles subject to the regulation due to the poor economy. To better understand the impact of current economic conditions on fleets affected by the regulation and their emissio ns, ARB staff is evaluating available data on vehicle activity, as well as attempting to evaluate whether fleets may have changed their turnover practices due to the poor ec onomy. Staff will present their findings at the January 2009, Board meeting.

Overall, staff believes the proposed modifications may result in a slight positive effect on health, i.e., result in reduced health impact from poor air quality, because extending the early credit deadline so that it is usable by more fleets may encourage fleets of all sizes to retrofit earlier than they otherwise would, ther eby achieving more immediate reductions in diesel PM. The earlier diesel PM is reduced, the more health benefits are achieved.

What will the cost impact of the proposed modificat ions be?

The proposed modification to extend the early doubl e credit provision for PM VDECS should result in no adverse economic impacts, and i nstead should ease the burden of the regulation on affected fleets. This is because the proposed extension would help fleets spread out the costs of the regulation, with out increasing the overall cost of the regulation. The proposed modification is expected to lower costs in 2010, the year of maximum expected annual regulation costs (ARB, 2007 a). The other proposed modifications will not increase compliance costs fo r the regulation.

What did the Board direct staff to report back on b y January, 2009?3

In Resolution 07-19, the Board directed staff to, b y January 2009, provide a technology update report on the status of VDECS that are avail able for installation to comply with the March 1, 2010 compliance date of the regulation (ARB, 2007d). The Board also directed staff to include an update on the number o f devices that have been verified, the cost of those devices, and information on the ARB/S outh Coast Air Quality Management District/Mobile Source Air Pollution Reduction Revi ew Committee Off-Road Diesel Retrofit Showcase (Showcase).

This is the first of four updates the Board directe d staff to provide. Resolution 07-19 also directed staff to:

• By December, 2010, provide a status report on comp liance with and enforcement of the March 1, 2010, compliance date for large fle ets, including an analysis of the regulation’s flexibility provisions and its eco nomic impacts; and

• By December, 2013 and December, 2017, provide upda tes on compliance and enforcement for the periods March 1, 2010 through M arch 1, 2013, and March 1, 2013 through March 1, 2017, respectively, and updat es on the progress of engine technology needed to comply with the regulat ion.

What diesel emission control strategies have been v erified to date?

ARB’s verification program 1 is intended to ensure that a device achieves the a dvertised emission reductions and meets minimum durability re quirements. To receive ARB verification, the device manufacturer must submit d ata showing the device is effective and durable and warrant the VDECS and the engine ag ainst any damage caused by the device. ARB’s verification procedure is a multi-le vel verification program consisting of PM reduction levels (Levels 1, 2, and 3) and option al oxides of nitrogen (NOx) reduction levels.

There are two main types of DPFs – passive and acti ve. Passive DPFs use a catalyst to lower the PM ignition temperature, so no outside so urce of energy is required for regeneration. Unlike a passive DPF, an active DPF uses an external source of heat to burn off the accumulated PM. The most common sourc es of heat are (1) plugging in to pass a current through the filter medium, and (2) i njecting and burning additional fuel. Nearly all vehicles can be retrofitted with an acti ve DPF, although for many off-road applications DPFs that require plugging in are not feasible, so fuel-burner active DPFs like the HUSS Umwelttechnik FS_MK are the most broa dly applicable. However, for many reasons including cost and ease of operation, many fleets find passive systems to be more desirable.

When the regulation was approved in July 2007, ther e were only three Level 3 DPFs verified for off-road use (all active DPFs). Of th e types of systems verified by ARB, Level 3 systems are the most effective, reducing di esel PM by at least 85 percent. Since the adoption of the regulation, three additio nal systems have now been verified and are available:

• Caterpillar DPF,

1 Title 13, California Code of Regulations (CCR), se ctions 2700-2710.4

• DCL International Inc. DPF, and

• Engine Control Systems’ Purifilter DPF.

What is the potential penetration of passive DPFs i n the off-road fleet?

Until mid-October 2008, passive DPF systems were av ailable to less than five percent of off-road vehicles and 11 percent of off-road veh icle horsepower (hp) covered by the regulation. However, in late October, ARB issued a dditional verifications, which significantly expanded the availability of passive off-road DPFs. Staff now estimates that up to 24 percent of all off-road vehicles and up to 60 percent of the horsepower of affected off-road vehicles could have passive DPFs installed. 2

What is the cost of DPFs available today?

The vast majority of VDECS that have been installed in California so far are active systems. Current active VDECS costs range from bel ow $14,000 for a less than 50 hp engine to nearly $50,000 for an engine over 500 hp. Very few passive DPFs have been installed so far, but the average cost for these pa ssive installations on engines of 230 to 300 hp was about $21,000.

The current costs for DPFs are about 30 percent hig her than the overall average cost over the life of the regulation for DPFs assumed in the initial staff report for the regulation (ARB, 2007a) 3 . However, the cost analysis in the initial staff report was based on estimates of the average prices for DPFs o ver the course of regulation (through year 2030). As the market for DPFs expand s, staff expects the volume of sales, coupled with the increased number of DPF opt ions fleets may choose from, to reduce retrofit costs relative to today’s prices. In addition, staff also expects the expanded availability of passive DPFs in additional horsepower ranges to provide less costly retrofit solutions relative to today. Overal l, staff expects these retrofit costs will lower over time, bring them in line with the estima ted VDECS costs presented in the initial staff report.

What is the status of the Showcase?

Since 2007, staff in conjunction with the South Coa st Air Quality Management District (SCAQMD) and the Mobile Source Air Pollution Reduct ion Review Committee (MSRC) has engaged in developing the Showcase program. Th is program is providing valuable experience to staff, fleets, and retrofit manufactu rers on the challenges of retrofitting offroad vehicles, and is facilitating an increase in t he number of available VDECS. To date, the Showcase has been funded at $4.9 million, including $3.7 million from the

2 The percentages are upper-bounds in that they do n ot account for several factors, including the fact that some engines do not attain sufficient exhaust temperatures to be retrofit with passive DPFs. 3 This estimate weights current active DPF costs by 70 percent and current passive DPF costs by 30 percent, which is the original distribution o f active versus passive DPFs assumed in the staff report.5

MSRC, and $1.2 million from the SCAQMD. As of earl y November 2008, 18 fleets with 202 vehicles have applied and been accepted to part icipate in the Showcase. Of the eighteen participating fleets, thirteen are private ly-owned, and five are public. In addition, 14 emission control manufacturers with 26 systems are participating in the Showcase. The 26 systems include 11 active DPFs an d 15 passive DPFs. Seven of these systems reduce NOx as well as PM, and six of the systems include fuel borne catalysts. The vehicles participating in the Showc ase include off-road engines with a full range of emission standard tier levels, from t he highest emitting uncertified Tier 0 engines to the cleanest new Tier 3 engines. Also, there are systems included in the Showcase that are seeking verification for engines of all certification tiers.

To date, over 60 vehicles have been datalogged, and 9 vehicles have been retrofit, which is slower than originally anticipated. A var iety of circumstances - including contracts taking longer than expected, participatin g vehicles having reduced usage or being pulled from service or retired, and installat ion designs being more complicated than anticipated - have pushed back the timeline fr om what was originally anticipated. However, staff estimates that all the vehicles part icipating in the Showcase will be retrofit by mid-2009.

In addition to the Showcase, ARB staff is participa ting in another off-road demonstration project with the United States Environmental Protec tion Agency (U.S. EPA) known as the Supplemental Environmental Project (SEP). Its goals are identical to the Showcase, and it is funded with $700,000 in settlement funds from two U.S. EPA enforcement cases. Thus far, 22 vehicles have been retrofit th rough the SEP and an additional 16 are expected to be retrofit in the next three month s. In both the Showcase and SEP programs, fleets have been satisfied with the opera tion and reliability of the DECS.

What major milestones in implementation of the regu lation have been achieved?

First, staff conducted 13 free training seminars th roughout the state including at the following locations:

• San Luis Obispo

• Bakersfield

• Redding

• Nevada City

• Fresno

• Riverside

• San Diego • El Monte

• Sacramento

• San Jose

• Ventura

• Oakland

• South Lake Tahoe

More than 12,000 flyers were distributed to publici ze the seminars, and about 1,300 stakeholders attended.

Staff has also made presentations to over 15 groups , such as the National Association of Demolition Contractors and California Golf Cours e Superintendents Association. In addition, staff has met individually with dozens of individual stakeholders and fleets, and6

attended nine conferences and workshops to distribu te information regarding the regulation.

ARB also formed an advisory group, called the off-r oad implementation advisory group (ORIAG), in March 2008, to assist staff with outrea ch and implementation. ORIAG has had three general meetings and has formed the follo wing subcommittees:

• Safety,

• Diesel emission control strategies (DECS),

• Fleets,

• Outreach, and

• Diesel Off-road On-line Reporting System (DOORS).

ORIAG has also created a guidance document review g roup, which reviews guidance documents and answers to frequently asked questions before ARB releases them to the public. The input from the ORIAG members and subco mmittees has proved invaluable in implementing the regulation.

Staff is also currently working with the Contractor s State License Board (CSLB) to have information about the off-road regulation inserted into their contractor renewal letters. Staff expects to be able to reach approximately 15, 000 contractors each month through CSLB renewal letters.

Finally, staff has built an electronic reporting sy stem called DOORS to enable fleet owners to report their fleet information to the ARB . Staff has been strongly encouraging fleets to voluntarily report early. As of November 17, 2008, 64 fleets have reported information for over 7,100 vehicles, and a number o f fleets have begun labeling their vehicles with Equipment Identification Numbers.

What is the status of obtaining authorization from U.S. EPA to enforce the regulation?

Two provisions in the regulation became enforceable as soon as the regulation became effective on June 15, 2008: a five minute limit on unnecessary idling for off-road diesel vehicles, and the requirement for sellers located i n California to disclose in writing that the vehicle sold may be subject to the regulation. ARB enforcement staff has begun auditing vehicle dealerships and auction sites and performing unannounced construction site inspections to enforce these two provisions.

However, to fully enforce the regulation’s performa nce and recordkeeping requires, under section 209(e) of the federal Clean Air Act ( CAA), ARB needs to obtain formal authorization from U.S. EPA. ARB submitted a reque st for authorization from U.S. EPA on August 12, 2008. On October 7, 2008, U.S. EPA p ublished notice of its intent to consider California’s request in the Federal Regist er (U.S. EPA, 2008) at a hearing in Washington DC on October 27, 2008. Staff attended the hearing and gave a presentation explaining why U.S. EPA should issue s uch authorization. The comment period for U.S. EPA’s consideration of the authoriz ation request was originally7

scheduled to end November 28, 2008, but has now bee n extended until December 19, 2008 (U.S. EPA, 2008a; U.S.EPA, 2008b).89

I. INTRODUCTION
The purpose of this report is to update the Air Res ources Board (ARB or Board) on the status of retrofit technology available to fleets t o comply with the Regulation for In-Use Off-Road Diesel-Fueled Fleets (the regulation). Th is report also discusses the efforts taken by staff to implement the regulation. Finall y, this report describes a number of minor modifications and clarifications to the regul ation that are being proposed by staff.

A. Background
The regulation was approved by the Board on July 26 , 2007, and when implemented will reduce emissions of diesel particulate matter (PM) and oxides of nitrogen (NOx) from in-use off-road diesel vehicles that operate i n California. The regulation is codified at California Code of Regulations (CCR), title 13, sections 2449 through 2449.3. The regulation will significantly reduce the public’s e xposure to diesel PM and NOx emissions from the nearly 180,000 off-road diesel v ehicles that operate in California by requiring fleet owners to accelerate turnover to cl eaner engines and install exhaust retrofits (ARB, 2007a). The regulation supports th e Diesel Risk Reduction Plan to Reduce Particulate Matter Emissions from Diesel-Fue led Engines and Vehicles, which was adopted by the Board on September 30, 2000 and the 2007 State Implementation Plans for the South Coast and San Joaquin Valley ai r basins (ARB, 2000; ARB, 2007c).

The scope of the regulation is far reaching; affect ing vehicles of dozens of types used in over 8,000 fleets, in industries as diverse as cons truction, air travel, manufacturing, landscaping, and ski resorts, as well as public age ncies. The regulation will affect, among others, the warehouse with one diesel forklif t, the landscaper with a fleet of a dozen diesel mowers, the county that maintains rura l roads, the landfill with a fleet of dozers, as well as the large construction firm or g overnment fleet with hundreds of diesel loaders, graders, scrapers, and rollers.

The regulation’s requirements vary depending on the size of the fleet and on the vintage of its vehicles. Fleets are defined in the regulat ion as small, medium, or large based on their total statewide horsepower. The regulation re quires that the largest fleets, which have the most significant emissions and are most ab le to rapidly understand and absorb the costs of compliance, are required to meet the m ost stringent requirements. The smallest fleets, and local municipal fleets located in low-population counties, are required to meet the least stringent provisions.

B. Report Overview
In approving the regulation, the Board directed sta ff in Resolution 07-19 to provide the Board, by January 2009, with a technology update on the status of diesel emission control strategies that have been verified by ARB a nd are available for installation to comply with the March 1, 2010, compliance date of t he regulation (ARB, 2007d). Additionally, the Board directed that the update in clude information on the number of devices that have been verified, the cost of those devices, and the status of the ARB/South Coast Air Quality Management District/Mob ile Source Air Pollution10

Reduction Review Committee Off-Road Diesel Retrofit Showcase (Showcase). This report also includes an update on the status of imp lementation of the regulation, including information on public outreach, reporting , enforcement, the status on the Surplus Off-Road Opt-In for NOx (SOON) program, and the activities of the Off-Road Implementation Advisory Group (ORIAG). Additionall y, as part of this update staff is proposing to modify the regulation by extending the double credit deadline for the early installation of Verified Diesel Emission Control St rategies (VDECS) from March 1, 2009, to January 1, 2010. Staff is also proposing a few additional modifications to the regulation to clarify certain provisions of the reg ulation. A full description of these proposed changes is provided in Chapter IV, and the proposed regulatory language is provided in Appendix A.11

II. TECHNOLOGY UPDATE
This chapter discusses ARB’s verification program f or diesel emission control systems (DECS), the status of current off-road verification s, ongoing off-road demonstration programs, the number of VDECS that have been instal led to date, the cost of available VDECS, and VDECS safety.

A. ARB’s Verification Program
The regulation only requires the installation of a retrofit device that has been verified under ARB’s verification program. ARB’s verificati on program, previously adopted by the Board and codified at title 13, CCR, sections 2 700 through 2710, is intended to ensure that a device achieves the advertised emissi on reductions and meets minimum durability requirements. Also, to receive ARB veri fication, the device manufacturer is required to warrant the VDECS and the engine agains t any damage caused by the device. ARB’s verification procedure is a multi-le vel verification program consisting of three PM reduction levels and optional NOx reductio n levels. The regulation gives credit for Level 2 and Level 3 PM devices, which ac hieve at least 50 percent and 85 percent PM reductions, respectively.

B. Status of Current Off-Road Verifications

1. Off-road verifications
There are several types of diesel particulate filte r (DPF) technologies that are available to meet the requirements of the regulation. DPF te chnology that uses a catalyst to lower the PM ignition temperature is termed a passi ve DPF, because no outside source of energy is required for regeneration. Unlike a p assive DPF, an active DPF system uses an external source of heat to oxidize the accu mulated PM. The most common methods of generating additional heat for oxidation involve electrical regeneration by passing a current through the filter medium (i.e., a plug-in system), injecting and burning additional fuel to provide additional heat for part icle oxidation, or adding a fuel-borne catalyst or other reagent to initiate regeneration. Some active systems collect and store diesel PM over the course of a full shift and are r egenerated at the end of the shift with the vehicle or equipment shut off.

Currently, there are six Level 3 DPFs verified for off-road use. Table 1 below lists all the current VDECS for off-road vehicles. All of the VD ECS shown in Table 1 are Level 3 DPFs. Three of these -- the Caterpillar diesel par ticulate filter (DPF), the DCL International Inc. DPF, and Engine Control Systems’ Purifilter DPF – have recently been verified and entered the market after the off-road regulation was adopted in July 2007. The Caterpillar DPF’s verification was also recentl y expanded to include track-type vehicles.12 Table 1: Currently Verified Level 3 Off-Road DPFs

Product Type

(Active or Passive) Applicability Max Allowable PM Certification Level of Engine

Caterpillar DPF Passive Verified for some 1996-2008, 175-600 hp, non-exhaust gas recirculation (EGR) Less than or equal to 0.2 grams per brake-horsepower hour (g/bhp-hr)

Cleaire Horizon Active; Plug-In Conditionally verified for many 2007 and older, non-EGR, less than 15 liters Less than or equal to 0.4 g/bhp-hr

DCL MINE-X Sootfilter Passive Conditionally verified for some 1996-2008, 175-300 hp, non-EGR, rubber tired Less than or equal to 0.15 g/bhp-hr

Engine Control System Combifilter Active; Plug-In Verified for many 2007 and older, 25-300 hp (certain conditions) or 175-300 hp, non-EGR, rubber-tired Less than or equal to 0.45 g/bhp-hr

Engine Control Systems’ Purifilter Passive Conditionally verified for some 1996-2008, 50-750 hp, non-EGR 0.01 to 0.2 g/bhp-hr

HUSS Umwelttechnik FS_MK Active; Fuel

Burner Verified for most offroad diesel engines through 2008, most hp, non-EGR No restrictions

In addition to the Level 3 DPFs listed above, there is one Level 2 off-road VDECS 4 . It consists of a diesel oxidation catalyst (DOC) used with an emulsified diesel fuel.

Although the availability of off-road VDECS is incr easing, VDECS have become available at a slower pace than staff anticipated. This lack of off-road verifications is due to a number of reasons, including:

• It is challenging to find the proper vehicles and engines for off-road demonstration programs to ensure the broadest verif ication possible for each system (discussed in further detail later in this C hapter);

• It is difficult to accrue the number of hours nece ssary for datalogging due to lower equipment activity related to the current eco nomy;

• Some manufacturers have limited the resources they have invested in off-road verifications, focusing more on the verification of on-road systems; and

4 Although this device is still listed on ARB’s veri fication website, the manufacturer of this product withdrew it from the market several years a go.13

• The Showcase has had a slower start than anticipat ed (discussed later in this Chapter).

While it is difficult to predict with certainty, AR B staff anticipates that more off-road VDECS will become available in the near future. Th ere are over 30 systems currently in the verification process for off-road applications, with several systems in the final stages of verification. Nearly all are Level 3 systems. Approximately five systems will reduce NOx, either alone or in concert with PM reductions. In addition, some manufacturers with current off-road VDECS are working to expand t he scope of their verifications.

2. Scope of off-road verifications
As part of their assessment, staff has estimated th e scope of applicability of the current off-road VDECS. To do this, staff conducted an ana lysis using the statewide off-road inventory to estimate the fraction of vehicles in t he statewide fleet that could potentially be retrofit with currently verified off-road retrof its (ARB, 2006). Although a device may be verified for a specific engine, it may not alway s be verified or appropriate for the application in which the vehicle is used. Because of this, staff considers this analysis as an upper bound estimate of the number of off-road v ehicles in the statewide fleet that could be retrofit with currently available off-road VDECS.

To develop this estimate, staff used the following information:

• The verification letters (also referred to as Exec utive Orders) for each off-road VDECS. The Executive Orders specify the horsepower , model year, emissions levels, and whether the device can be used with eng ines equipped with EGR.

• Letters from VDECS manufacturers exempting certain vehicle types or models from retrofitting under the Carl Moyer program (Bru enke, 2007a; Bruenke, 2007b; Bruenke, 2008a; Bruenke, 2008b; Bruenke, 2008c; Bru enke, 2008d; Luksik, 2008). Staff’s analysis assumes that such exempted vehicle types or models cannot be retrofit.

Appendix B of this report contains further detail a bout how staff estimated the current extent of verifications.

Of the six Level 3 verifications, the Huss active f uel burner system verification has the broadest application. It is verified for most off- road diesel engines through 2008, as long as the engine does not come equipped with EGR and is not in one of the high horsepower applications for which Huss has indicate d its system is not feasible. These high horsepower applications include several models of scrapers and dozers, but affect only about 1.5 percent of the total statewide fleet (see Appendix B). While from a technical perspective nearly all vehicles could be retrofit with the Huss or other active systems, as discussed below, fleets have expressed operational concerns regarding the use of active systems.

For a number of reasons, many fleets find active sy stems to be undesirable; the reasons for this include the need for external powe r, the requirement to shut a vehicle down for filter regeneration, and cost. The use of plug-in active systems, such as the14

Cleaire Horizon and ECS Combifilter, that require a ccess to high voltage electrical power are challenging for vehicles that may be used away from a power source. For example, if a loader is operating at a remote const ruction site, and does not return to a central facility each night, it may not be feasible for that fleet to install a plug-in DPF on that loader because there is no on-site access to e lectricity for filter regeneration. On the other hand, fuel burner systems, such as Huss’s active DPF fuel burner system, avoid this issue since they do not require an exter nal source of power. However, despite this, such systems are also not desired by many fleets, especially ones with older, lower tier vehicles, because the vehicles ha ve to be turned off so the filter can be regenerated. Sometimes this filter regeneration in terval can be frequent enough, in some cases approaching every few hours, to make use of the vehicle inconvenient or impractical (Porcher, 2008). In addition, as descr ibed later, active systems are generally more expensive than passive systems. How ever, active systems are still appropriate in many applications, and represent a m ajority of the systems currently installed on off-road vehicles.

Until recently, less than five percent of the vehic les and 11 percent of off-road vehicle horsepower covered by the regulation had passive DP F systems available. 5 In late October 2008, a new ECS system was verified, and th e verification for the Caterpillar passive VDECS was significantly expanded; staff now estimates that up to 24 percent of the vehicles and up to 60 percent of the horsepower of affected off-road vehicles are capable of having a passive VDECS installed. 5, 6 However, due to the late date of verifications, fleets, as presently adopted, had le ss than two weeks 7 to order these systems, which are now available for a wider variet y of vehicles, and secure guaranteed double PM VDECS credit under the regulation. As is discussed later, this is the primary rationale for staff’s proposal to extend the early PM credit provisions of the regulation.

C. Status of Current Off-road Demonstration Program s ARB staff is actively involved with three DECS demo nstration programs: the Showcase, a United States Environmental Protection Agency (U. S. EPA) Supplemental Environmental Project (SEP), and a snowcat demonstr ation project. These programs are providing valuable experience to staff, fleets, and retrofit manufacturers on the challenges of retrofitting off-road vehicles, and a re facilitating an increase in the number of verified off-road DECS.

5 The percentages estimated are the maximum possible percent of vehicles and engines that could be retrofit. They do not account for factors such as that some engines do not attain sufficient temperature to be retrofit with passive VDECS. Also, they do not fully account for the fact that one passive VDECS, the Caterpillar DP F, was verified only for rubber tired applications. ARB’s inventory data do not allow st aff to subtract out tracked vehicles for vehicle types such as loaders that can be either tr acked or rubber tired (ARB, 2006).
6 It is estimated that in 2010, approximately 35,000 or 18 percent of the vehicles in the statewide fleet will need VDECS to comply with the regulation ; by 2011, approximately 60,000 or 30 percent of the statewide fleet will need VDECS (ARB , 2007b).
7 Less than two weeks from the date of the verificat ions.15

1. Showcase

a) Overview
In anticipation of the need for additional verified DECS for off-road equipment, ARB, in conjunction with the South Coast Air Quality Manage ment District (SCAQMD) and the Mobile Source Air Pollution Reduction Review Commit tee (MSRC), is administering the Showcase. Stakeholders in the Showcase include ret rofit device manufacturers, fleet operators, other local air pollution control distri cts in California, and U.S. EPA.

The goals of the Showcase project are to:

• Demonstrate the effectiveness and durability of DE CS on off-road vehicles;

• Increase the number of VDECS for off-road applicat ions;

• Support the regulation through increased availabil ity of VDECS;

• Introduce DECS to off-road fleets;

• Provide early reductions of emissions from off-roa d vehicles; and

• Gain additional experience with the installation a nd use of DECS on off-road vehicles.

The Showcase has been funded for $4.9 million, incl uding $3.7 million from the MSRC, and $1.2 million for devices which control NOx from the SCAQMD. Additional information about the Showcase, including backgroun d, current status, vehicle data, photos, and datalogging results are available at th e web site http://www.arb.ca.gov/diesel/showcase/showcase.htm

.

b) Current Status

The Showcase covers a diverse combination of device s and vehicles in an effort to demonstrate and verify as many devices as possible covering a broad array of vehicles and applications. Vehicles were selected to repres ent a full range of vehicle types affected by the off-road regulation, as well as a f ull range of engine sizes. Additional information is provided in Tables 1 and 2 of Append ix C. As of early November 2008, 18 fleets with 202 vehicles have applied and been a ccepted to participate in the Showcase. Thirteen of the fleets are privately-own ed, and five are public. The participating fleets are listed in Table 3 of Appen dix C.

Participation in the Showcase by fleet owners provi des them with a number of benefits. First, fleet owners are able to gain valuable exper ience with DECS with little or no capital outlay on their part. In addition, fleet p articipants are able to accumulate early double PM retrofit credits to be used to offset fut ure fleet retrofit requirements.

Fourteen emission control manufacturers with 26 sys tems are participating in the Showcase. The 26 systems include 11 active DPFs an d 15 passive DPFs. Seven of the systems reduce NOx as well as PM, and six of th e systems include fuel borne catalysts. As shown in Figure 1 below, the vehicle s participating in the Showcase include off-road engines with a full range of engin e tier levels, from the highest emitting uncertified Tier 0 engines to the newest, cleanest Tier 3 engines. Some of the systems included in the Showcase are seeking verification f or engines of all tiers, while others16

are limited to newer engines. The list of particip ating emission control manufacturers is located in Table 4 of Appendix C.

Figure 1: Showcase Installations of DECS

0 10 20 30 40 50 60 70 80 90

0 1 2 3
Engine Tier# of Engines

0 5 10 15 20 25 30# of Systems Engines Systems

As of November 2008, over 60 engines have been data logged, as described below, and 9 engines have been retrofitted through the Showcas e. Tables 1 and 2 of Appendix C include a list of the vehicle types and engines tha t have been retrofit so far, and a list of vehicle types and engines that are remaining to be retrofitted. It will be several more months until all vehicles are retrofitted.

In the initial stages of the Showcase, staff antici pated that all vehicles would have been datalogged, installation designs completed, and mos t retrofits installed by November 2008. However, a variety of circumstances have pus hed back this timeline. The primary reasons for the delay are:

• Contracts took much longer to execute than expecte d;

• Economic effects (vehicles had reduced usage or we re pulled from service or retired);

• Fleets requested a change of vehicles;

• Installation designs were more complicated than an ticipated, in some cases increasing the price;

• The exhaust temperatures required an active device when initially a passive device had been planned; and

• A few devices were removed prior to installation a s the manufacturers felt they needed further development.

However, the data gathered thus far has provided a significant increase in knowledge regarding the applications of DECS on off-road vehi cles. For example, during the17

development of the regulation, staff estimated that most off-road engines (approximately 70 percent) would require an active, rather than pa ssive, DPF (ARB, 2007b). However, datalogging of engine temperature and backpressure through the Showcase program indicates that over three-quarters of datalogged en gines produce sufficiently high exhaust temperatures that would support the use of a passive DPF. This is encouraging because passive devices tend to be sign ificantly less expensive than active DPFs and - as discussed above - are typicall y more desirable to fleets. Individual datalogging results are available on the Showcase w ebsite listed above; one example is included in Appendix C (Figure 1 and Figure 2).

2. U.S. EPA’s Supplemental Environmental Project

Three refineries in Northern and Southern Californi a, in collaboration with the U.S. EPA and the ARB, have agreed to provide funding for ret rofitting off-road vehicles with DECS. The refineries are providing the funding thr ough the U.S. EPA SEP program, under which a violator offsets excess pollution by funding emission reductions projects in the immediate vicinity of the violation.

The goals of the SEP are similar to the Showcase. The SEP will complement the Showcase by filling gaps in the test vehicle matrix that were unable to be addressed in the Showcase (see Appendix C, Table 10 for the matr ix of vehicles).

The SEP project is divided into three stages – SEP I through SEP III - with total funding of $700,000. The funding for each SEP stage and th e scope and status of each is shown in Table 2.

Table 2: SEP Funding and Number of Engines Retrofit ted

SEP Funding # of

Fleets # of

Engines Status as of Early Nov
I $300,000 3 15 DECS Installed II $200,000 3 11 DECS Installed
III $200,000 4 12 Datalogging vehicle exhaust temperatures

Tables 5 and 6 of Appendix C include a list of the vehicle types and engine sizes that have been retrofit so far in SEP I and SEP II; a li st of vehicle types and engine sizes that are proposed to be retrofit in SEP III is also included in Table 7 of Appendix C.

Similar to the Showcase, fleet owners are able to g ain valuable experience with DECS with little or no capital outlay on their part. In addition, fleet participants are able to accumulate early PM retrofit credits to be used to offset future fleet retrofit requirements. However, the SEP – unlike the Showcase – offers onl y single, not double, retrofit credit. 8

8 The U.S. EPA specified that fleets should only rec eive single credit for DECS installations funded through the SEP, because the funding was int ended to offset emissions violations at the three refineries.18

SEP information including vehicle data, photos and datalogging results are available at the web site http://www.arb.ca.gov/diesel/showcase/showcase.htm . Tables 8 and 9 of Appendix C list the fleets and emissions controls m anufacturers participating in the SEP, respectively.

3. Snowcat demonstration project
A typical off-road engine in California operates at low elevations and in mild temperatures. The DECS verification procedures do not require testing at high elevations or in low ambient air temperatures. Dur ing the development of the regulation, some stakeholders raised concerns that under these conditions, DECS would not perform well. To evaluate these concerns , during the winter of 2007/2008, twelve snowcats used for snow grooming operations w ere datalogged at the three northern California ski resorts shown in Table 3.

Table 3: Snowcat Project Locations and Number of Ve hicles

Ski Resort Number of Vehicles

Datalogged Sugar Bowl 2 North Star 5 Mammoth 5

Snowcat engines operate a majority of the time unde r medium to heavy load. Many ski resorts have some slopes so steep that the snowcats must winch themselves up and down those slopes because the treads alone do not p rovide sufficient traction. Based on staff’s evaluation of datalogged information, st aff determined that despite the high elevation and low ambient air temperature that snow cats are typically subject to, their engine exhaust temperatures are high enough that pa ssive DPFs can be used. In fact, one resort has already installed passive DPFs on so me of their snowcats.

Snowcat demonstration project information including vehicle data, photos and datalogging results are available at the web site http://www.arb.ca.gov/diesel/showcase/showcase.htm

. 4. Overall findings of the demonstration programs
The most significant finding of the Showcase, SEP, and Snowcat demonstration programs to date has been that more vehicles than e xpected have sufficiently high exhaust gas temperatures to be retrofit with passiv e devices. Every engine in every vehicle participating in these retrofit demonstrati on programs has or will be datalogged for 5 to 7 days. The datalogging tracks the charac teristics of the exhaust by recording temperature and backpressure. Analysis of the over 110 vehicles datalogged to date demonstrates that over three-quarters of these engi nes produce sufficiently high19

exhaust temperatures to support the use of a passiv e DPF. 9 Passive devices tend to be significantly less expensive than active DPFs and l ess complicated, therefore they are often more desirable to fleets.

The Showcase and SEP programs have also demonstrate d that off-road retrofits are durable and can function well while effectively red ucing diesel PM pollution on a wide variety of vehicle types. Thirty devices have been installed on a wide diversity of vehicle types including tractors, graders, loaders, backhoes, excavators, and scrapers, and all the retrofit devices are working well. In addition, these demonstration programs have highlighted the need to ensure proper installa tion, as there were a limited number of installation issues, such as exhaust leaks, enco untered during installation; however, these issues have been or are in the process of bei ng resolved. 10 Despite these issues, the overwhelming reaction of fleets partici pating in these demonstration programs to retrofits has been extremely positive.

Over the next 6 to 12 months in the Showcase and SE P programs, staff plans to complete the following tasks:

• Install devices onto the remaining off-road vehicl es;

• Continue datalogging to gather exhaust temperature data;

• Monitor the performance of the devices;

• Measure emissions during vehicle operation with an on-board portable emissions measurement system (PEMS); and

• Survey the fleet owners and operators regarding th eir opinions concerning operation of the retrofits.

Staff is continuing to work with retrofit manufactu rers participating in these demonstration programs to develop the data necessar y to demonstrate the durability and performance of their products in support of ver ification. Staff is also optimistic that the information and lessons learned through these d emonstration programs regarding the installation and operation of off-road retrofit s can be used broadly by affected fleets and retrofit installers to assist them during the i mplementation of the regulation.

D. Total Number of VDECS installations

To date, staff estimates that about 430 off-road ve hicles have been retrofit in California with a Level 3 off-road VDECS, including dozers, lo aders, excavators, backhoes, graders, and tractors. Because there is as yet no requirement for fleets or VDECS installers to report each VDECS installation to ARB , staff does not have details on each installation or an exact count of how many VDECS ha ve been installed. However, staff has interviewed VDECS manufacturers to obtain an es timate of how many retrofits are already in place, and will have a better sense of t he actual number of installations once

9 The Showcase and SEP did not capture smaller horse power engines, and smaller horsepower engines will likely require active DPFs. 10 At the time of this report’s writing, thirty devic es were installed and one device which encountered difficulties during installation was aw aiting final installation.20

fleets begin reporting in the spring of 2009 (Hallo ran, 2008; Jerman, 2008; Brown, 2008; Swenson, 2008; Surma, 2008).

E. Cost of Verified Diesel Emission Control Strateg ies
Table 4 below shows the current average costs 11 for purchase and installation of active VDECS based on data from three VDECS installers (Co x, 2008; Ostrander, 2008; Cram, 2008), and the Carl Moyer program database (C ARL, 2008). The data shown in Table 4 is for 194 of the estimated 430 VDECS insta llations that have occurred to date on off-road vehicles in California.

Table 4: Summary of Active VDECS Costs in 2008
Engine Horsepower Range Active VDECS

Cost in 2008 < 50 $13,800 50-120 $15,500 121-175 $19,300 176-250 $19,100 251-400 $44,600 401-500 $44,800 500+ $48,400

The data indicates that the cost to apply an active VDECS to a vehicle shows a distinct jump at around 250 horsepower. This substantial in crease in cost is largely due to the necessity of using multiple canisters or larger fil ter sizes for engines above 250 horsepower.

Very few passive VDECS have been sold in California because they were verified only recently. Therefore, there are insufficient data t o determine the average costs over a full range of engine horsepowers. Staff has cost d ata on a handful of installations of passive VDECS that have been installed on engines o f approximately 230 to 300 horsepower, and the average cost for these passive installations was about $21,000. ARB staff will continue to collect information on V DECS costs, as more passive systems are purchased and installed.

The current costs for installed VDECS 12 are, on average, about 30 percent higher than initially estimated by staff during the development of the regulation (ARB, 2007b). However, staff’s initial cost analysis was based on estimates of the average prices for VDECS over the entire course of the regulation. As the market for VDECS expands, staff expects the volume of sales, as well as the i ncreased number of VDECS options fleets may choose from, to lower overall retrofit c osts. Staff also expects the availability of passive VDECS in additional horsepower ranges to provide less costly solutions where the application supports the use of a passive system. Staff expects these lower

11 Cost of VDECS unit plus installation.
12 Assuming a distribution of 30 percent passive DFPs and 70 percent active DPFs.21

cost solutions will lower the overall costs of DPFs over time, bringing them in line with the estimated VDECS costs presented in the initial staff report.

F. VDECS Safety
During the development of the regulation, staff rec ognized that some VDECS installations could present potential safety hazard s and that in some cases it would not be possible to install a VDECS safely. Potential s afety issues include significant visibility impairment, thermal hazards, and comprom ising the structural integrity or center of gravity of the vehicle, with visibility i mpairment likely to be the most common issue. Recognizing these potential safety hazards, the regulation includes provisions to exempt a vehicle from the VDECS requirements if one can not be installed safely. Under the regulation, a fleet owner may request tha t the Executive Officer review and determine whether a VDECS should not be considered the highest level VDECS available because of potential conflict with other safety and health requirements. As part of these provisions, there is also an appeals process for any party whose request has been denied.

Staff is currently working with staff from the Cali fornia Occupational Safety and Health Administration (Cal\OSHA), the Mining Safety and He alth Administration (MSHA), and organized labor to develop the protocol for evaluat ing claims of unsafe installation of VDECS. Cal\OSHA and MSHA staff have been helpful i n assisting staff in compiling a summary of all relevant safety regulations. Cal\OS HA staff has attended Off-road Implementation Advisory Group (ORIAG, described in Chapter III) safety committee meetings. Cal\OSHA and MSHA staff have also agreed to work with ARB as part of a group that will review safety appeals. Staff also anticipates working with this group to develop amendments necessary to Cal\OSHA regulation s to establish more objective criteria for determining whether a specific VDECS i nstallation presents an unsafe condition.2223

III. IMPLEMENTATION UPDATE
This chapter describes staff’s ongoing efforts to i mplement the regulation.

A. Public Outreach
Since the regulation was approved in July 2007, sta ff has been working with affected industry stakeholders and other interested parties on its implementation.

1. Training seminars
Since July 2008, staff conducted thirteen free trai ning seminars throughout the state including in:

• San Luis Obispo,

• Bakersfield,

• Redding,

• Nevada City,

• Fresno,

• Riverside,

• San Diego,

• El Monte,

• Sacramento,

• San Jose,

• Ventura,

• Oakland, and

• South Lake Tahoe.

More than 12,000 flyers were distributed to publici ze the seminars, local newspapers helped publicize the trainings, and approximately 1 ,300 stakeholders attended the training sessions. The Sacramento training seminar was also webcast so interested parties could participate remotely via computer. E ach seminar lasted approximately three hours and provided a detailed explanation of the regulation and assistance on how fleets should address the regulation’s reportin g requirements. The seminars also provided interested fleets with the opportunity to speak with representatives from companies who manufacture or install off-road VDECS . A list of the seminar locations and attendance is included in Table 1 of Appendix D

.

ARB staff distributed feedback forms at each of the twelve training sessions. On a scale of 1 to 5, with five being the highest, parti cipants ranked the training as a 4.6 when asked if they thought it was worthwhile and wo rth their time to attend. Staff has another three training sessions currently scheduled and expected to be completed by the end of 2008 in Fortuna, Victorville and Sacrame nto, and plans to conduct additional training sessions in 2009.

2. Other outreach and assistance
Since the regulation was approved, staff has been m aking every effort to reach and inform interested parties about the regulation. Ove r the past year and a half, staff has24

conducted approximately 28 meetings with individual fleets and dealerships in a one-onone setting. In these meetings, staff provided an overview of the regulation, in addition to providing reporting and compliance planning assi stance. In addition, staff has not waited to be invited to relevant events; staff rese arched the meeting and conference schedules for a number of relevant trade associatio ns and called and offered to speak at and attend these meetings. In total, staff has spoken to 17 groups at industry trade association meetings and events. During this time, staff also attended nine conferences and workshops to give presentations regarding the r egulation or to provide fact sheets or other information to interested stakeholders. A dditionally, some of these events were held out-of-state; this enabled staff to more widel y outreach to those individuals or companies who frequently bring equipment into Calif ornia from surrounding states. A list of the organizations to which staff has made p resentations with since approval of the regulation is included in Table 2 of Appendix D. T able 3 of Appendix D lists individual fleets and stakeholders with which staff has met, a nd Table 4 in Appendix D describes the conferences that off-road implementation staff has attended to talk about the regulation.

Staff has also done multiple mailings to individual s potentially affected by the regulation and notified them about upcoming training sessions and outreach opportunities. The industry groups and associations that received noti fication of this information included off-road equipment manufactures, off-road engine ma nufactures, California county board of supervisors, county public works departmen ts, auction houses, theme parks, and general construction contractors.

In addition to traditional mailings, ARB has sent o ut multiple e-mail notifications through its Off-road list serve, which contains over 3,700 individual e-mail addresses. Staff is also currently working with the Department of Motor Vehicles (DMV) and the Contractors State License Board (CSLB) to get infor mation about the off-road regulation inserted into the agency’s respective registration and license renewal documents. Additionally, ARB staff expects to be able to reach approximately 15,000 contractors each month through CSLB renewal letters.

Staff is also producing a series of training videos to simply and clearly illustrate how to choose, install, and maintain VDECS. The goal for these videos is to help fleets gain the necessary understanding to more readily impleme nt rules such as the off-road regulation that require installation of VDECS. The se videos will include information such as:

• What are VDECS and how do they work;

• How to comply with regulatory VDECS requirements;

• Who to turn to for technical advice on VDECS;

• How to select a VDECS; and

• How to properly install and maintain VDECS.

Outreach efforts will continue in the future. ARB staff has designed a poster that will be placed in dealerships throughout the state where of f-road equipment is sold, as well as in public works offices and other places where owne rs of affected vehicles may25

frequent. Staff is also pursuing other avenues for getting the word out regarding the regulation, including the use of free public servic e announcements on radio stations.

B. Off-road Implementation Advisory Group
At the suggestion of several industry stakeholders, ARB formed an advisory group in March 2008 to assist staff with outreach and implem entation. The group, called the offroad implementation advisory group (ORIAG), is an i nformal committee made up of approximately 50 members selected to represent a cr oss-section of fleets, engine manufacturers, retrofit manufacturers and installer s, equipment dealers and manufacturers, trade groups, and others. Thus far, ORIAG has had three general meetings, in May, June, and September of 2008, all of which were webcast. ORIAG has also formed subcommittees on safety, DECS, flee ts, outreach, and the Diesel Offroad On-line Reporting System (DOORS), as well as a guidance document review group.

Every general meeting has been attended by most of the ORIAG members. In addition, as the meetings are open to the public, many additi onal interested members of the public have attended and participated. Through the subcommittees and during general meetings, ORIAG members have provided excellent sug gestions and feedback regarding, for example, the content of the training seminars, safe installation of retrofit devices, guidance documents (e.g., advisories and a nswers to frequently asked questions), and improving DOORS (the reporting syst em developed for the regulation). The feedback from ORIAG members has helped make ARB staff more aware of the needs and opinions of affected stakeholders and mor e able to effectively implement the regulation. Staff plans to continue to meet regula rly with ORIAG in the future as implementation of the regulation progresses.

C. SOON Program Status
The Surplus Off-Road Opt-In for NOx (SOON) program was established by section 2449.3 of the regulation. It is intended to allow local air districts to fund projects for offroad diesel vehicles operating inside their distric t to achieve additional NOx emission reductions beyond those expected from the base regu lation. Funding may come from any available funding source; however, staff expect s that most of the SOON program funding will come from the Carl Moyer incentive pro gram. The SOON program was implemented, in part, to assist the South Coast and San Joaquin Valley air districts in meeting federal air quality standards for ozone and fine particulate matter. In order for the SOON program to take effect, the participating district must develop administrative guidelines for the program and have those guideline s approved by ARB. Section 2449.3 allows the South Coast Air Quality Managemen t District (SCAQMD) and San Joaquin Valley Air Pollution Control District (SJVA PCD) to make the SOON program mandatory for fleets beginning in 2009.

While any air district may opt into the SOON progra m, to date only the SCAQMD has officially elected to do so. The SJVAPCD is presen tly in the process of opting into the SOON program. Further details on the status of SOO N in the SCAQMD and SJVAPCD are provided below.26

1. South Coast Air Quality Management District
The SCAQMD submitted draft SOON guidelines to staff on March 20, 2008, and May 12, 2008. The SCAQMD’s governing Board formally op ted into SOON on May 2, 2008, and ARB approved the SCAQMD SOON guidelines on June 6, 2008. The SCAQMD released the first solicitation for SOON projects w ith a submittal deadline of November 7, 2008 (SCAQMD, 2008).

Based on the first round of solicitations, the SCAQ MD has funded 125 off-road diesel vehicle repower projects from 21 private companies and one government agency at a cost of $16.6 million. 13 SCAQMD has committed to provide $30 million of Ca rl Moyer monies annually for the first four years of their S OON Program and will make another $13 million available with another round of solicit ations after the November 7, 2008, deadline.

2. San Joaquin Valley Air Pollution Control Distric t
The SJVAPCD submitted draft SOON guidelines for rev iew and assessment to ARB staff on August 25, 2008, and September 19, 2008. However, staff’s comments were not addressed in the most recent version of the pro posed guidelines, and staff disapproved the proposed guidelines on October 15, 2008 (White, 2008). Staff is continuing to work with the staff of the SJVAPCD to develop guidelines that are consistent with the SOON program. The current SJVA PCD implementation plan calls for the investment of five million dollars from Car l Moyer monies annually to fund SOON projects (Gamez, 2008).

D. DOORS
Staff has developed the DOORS system to enable flee t owners to report their fleet information to ARB as required by the regulation. DOORS is a web-based application using a database to store fleet data. Fleet owners , vehicle dealers, consultants and other members of the DOORS ORIAG subcommittee have provided input on the design and function of DOORS and are assisting in developi ng the compliance planning features and other enhancements as needed.

As shown in Figure 2, DOORS provides fleet owners a number of ways to provide their information to ARB, as well as providing many other features. As currently structured, DOORS allows fleet owners to:

• Enter their fleet information directly in on-line entry screens or by uploading information from a spreadsheet;

• View and edit their information; and

• Request ARB review of their information.

13 Carl Moyer monies were used.27 Figure 2: DOORS Screenshot

Staff has assisted fleets when they have had questi ons regarding DOORS reporting and has prepared an on-line user-guide (which is includ ed in Appendix E) to assist fleet owners. Staff also provided comprehensive training on DOORS in the first round of statewide training sessions. Building on this, sta ff is offering half-hour one-on-one training sessions to assist interested fleets in us ing DOORS during the second round of training in November and December of 2008.

The deadlines for initial reporting are rapidly app roaching – April 1, 2009, for large fleets, June 1, 2009, for medium fleets, and August 1, 2009, for small fleets. In total, staff expects that approximately 8,000 fleets with about 180,000 vehicles will be required to report their vehicles to DOORS. Staff has been strongly encouraging fleets to report early so that they will be able to become familiar with the process and be able to fully take advantage of the customer support bei ng provided by staff. As of November 17, 2008, 64 fleets have reported informat ion on over 7,100 vehicles. By reporting early, these fleets have provided themsel ves with extra time to label their vehicles with Equipment Identification Numbers (EIN s) as required by the regulation and shown in Figure 3.28 Figure 3: Vehicle Labeled with EIN

E. Enforcement Actions and Fines Issued
Two provisions in the regulation became enforceable when the regulation became effective on June 15, 2008: a five minute limit on unnecessary idling for off-road diesel vehicles, and the requirement that California-based sellers of off-road vehicles provide written disclosure to purchasers that the regulatio n may be applicable to the off-road diesel vehicles sold and operated in California.

Enforcement of the idling restrictions began in Oct ober, 2008, when ARB enforcement staff visited 15 construction sites in Southern Cal ifornia, and issued two citations for unnecessary idling and identified a dealer that had failed to include disclosure with offroad diesel vehicle sales. Based on the informati on provided by the dealer, enforcement staff identified 18 violations. Enforc ement staff is continuing to perform inspections of construction sites and audit dealers hips and auction houses, and are preparing to enforce the fleet reporting requiremen ts beginning next spring.

F. Waiver Status
The federal Clean Air Act (CAA) section 209(e)(2) p ermits California to adopt emission standards and requirements related to emission cont rol for in-use nonroad engines, so long as it obtains authorization from the Administr ator of the U.S. EPA prior to the regulation becoming effective. As part of the auth orization process, in Resolution 07- 19, the Board made the requisite protectiveness fin ding required under CAA section 209(e)(2) that the adopted regulations will be, in the aggregate, at least as protective of public health and welfare as the applicable Federal standards, that California needs its nonroad emission standards to meet compelling and e xtraordinary conditions, and that29

the standards and accompanying enforcement procedur es approved therein are consistent with CAA section 209.

ARB submitted the request for authorization to U.S. EPA on August 12, 2008. On October 7, 2008, U.S. EPA published notice that it would consider California’s request (U.S. EPA, 2008) at a public hearing on October 27, 2008. Staff attended the hearing in Washington D.C. and gave a presentation in support of its request. The comment period for U.S. EPA’s consideration of the authoriz ation request was originally scheduled to end November 28, 2008, but has now bee n extended until December 19, 2008 (U.S. EPA, 2008a; U.S.EPA, 2008b).3031

IV. PROPOSED MODIFICATIONS TO THE REGULATION FOR IN -USE OFFROAD DIESEL-FUELED FLEETS
This chapter discusses staff’s proposed modificatio ns to the regulation.

A. Regulatory Authority
ARB has authority under California law to adopt the proposed regulation modifications. California Health and Safety Code (HSC) sections 43 000, 43000.5, 43013(b) and 43018 provide broad authority for ARB to adopt emission s tandards and other regulations to reduce emissions from new and in-use vehicular and other mobile sources. Under HSC sections 43013(b) and 43018, ARB is directly author ized to adopt emission standards for off-road vehicular sources, as expeditiously as possible, to meet state ambient air quality standards. ARB is further mandated by Calif ornia law under HSC section 39667 to adopt Air Toxic Control Measures (ATCMs) for new and in-use vehicular sources, including off-road diesel vehicles, for identified TACs, such as diesel PM.

Under federal and California law, ARB is the primar y agency in California responsible for making certain that all regions of the State at tain and maintain NAAQS. To achieve this, California must adopt all feasible measures t o obtain the necessary emission reductions, including measures from mobile sources. The federal CAA preempts states, including California, from adopting requirements fo r new off-road engines less than 175 horsepower used in farm or construction equipme nt. However, California may adopt emission standards for in-use off-road engine s (federal CAA section 209(e)(2)). Because the proposed regulation addresses in-use ra ther than new off-road engines, it is permitted by the federal Clean Air Act. For exa mple, turnover of a vehicle is not required until a vehicle is older than 10 years. C alifornia must obtain authorization from the Administrator of the U.S. EPA before the in-use emission standards of this proposed regulation become enforceable. Since the proposed regulation is not within the scope of any existing U.S. EPA authorizations, California must obtain a new authorization from U.S. EPA prior to the regulation becoming effective (ARB, 2007a).

B. Public Process
Staff is planning to hold a public workshop on Dece mber 19, 2008, in Sacramento, California, to solicit public input on the proposed modifications to the regulation. However, since the regulation was adopted, staff ha s met and spoken with numerous affected fleets and industry representatives who ha ve expressed significant concerns regarding the limited availability of off-road VDEC S, and the need for extending the early credit provision.

In addition to the individual meetings, at the Sept ember 26, 2008 ORIAG meeting, staff solicited input from the ORIAG on the possibility o f extending the early credit deadline. Staff has considered all comments and recommendatio ns received from various stakeholders, and has crafted the proposed amendmen ts to the regulation to help address the specific concerns that were expressed.32

C. Need for Modifications
The early credit provision in the regulation curren tly provides double credit for VDECS installed by March 1, 2009. When a highest level V DECS is installed on an engine before March 1, 2009, that fleet will get double cr edit, meaning that the fleet will receive carryover retrofit credit equal to double the horse power of the engine on which the highest level VDECS is installed 14 . If there are manufacturing or installer delays t hat prevent a VDECS from being installed until after Ma rch 1, 2009, a fleet will still get double credit as long as the VDECS was ordered by N ovember 1, 2008.

Although the availability of off-road VDECS is incr easing, as discussed in Chapter II, VDECS have become available at a slower pace than s taff initially anticipated and have not allowed fleets to take full advantage of this e arly credit provision. When the regulation was initially adopted, staff anticipated there would be many additional offroad exhaust retrofits verified well before the ear ly credit deadline of March 1, 2009 (ARB, 2007a). In proposing the regulation to the B oard, staff noted that the early credit provisions for both PM and NOx would be important i n making the regulation affordable for some fleets (ARB, 2007e; ARB, 2008a). Early do uble PM credit was intended to give fleets the opportunity to spread out their ann ual compliance costs in the early years of the regulation over several years and to reduce otherwise potentially high initial compliance costs (ARB, 2007e; ARB, 2008a). If the d ouble early credit deadline for PM VDECS is not extended, the forecasted economic bene fits of the provision would not be as great.

As shown in Figure 4 below, prior to mid-October, 2 008, staff estimates that only 20 percent of fleets affected by the regulation could retrofit 10 percent or more of their vehicle horsepower with available passive verified DECS. Thus, most fleets with a need or strong preference for passive systems could not take full advantage of the early credit provisions. Even if they had wanted to purc hase retrofits for all of the vehicles in their fleet that could utilize retrofits, they woul d have been unable to accumulate even one year’s worth of retrofit credit in time to meet the November 1, 2008, date for guaranteed double credit.

14 Consider, for example, a large fleet with total ho rsepower of 10,000 hp that applies highest level VDECS to 1,000 hp of its engines before March 1, 2009. Such a fleet can bank 2,000 hp (1,000 hp times 2) in carryover retrofit credit. Then, on March 1, 2010, if the fleet does not meet the 2010 fleet average target for PM, it m ay choose not to meet the BACT requirements to retrofit 20 percent of 10,000 hp (i .e., 2,000 hp). Instead, the fleet may use its 2,000 hp of banked carryover retrofit credit an d postpone any required retrofitting to the following year.33

Figure 4: Breadth of Passive Level 3 Verifications by Fleet Hp 2008 15

As of Mid-October, 2008

Could
Retrofit
10% or
More of
Fleet Could
Retrofit <
10% of
Fleet 17%

83% Prior to Mid-October, 2008

Could
Retrofit <
10% of
Fleet Could
Retrofit
10% or
More of
Fleet 20%

80%

However, as can also be seen in Figure 4, now that several more verified systems have recently become available, staff estimates that 83 percent of fleets affected by the regulation can currently retrofit more than 10 perc ent of their vehicle horsepower with passive VDECS. Thus, many more fleets can now tak e full advantage of double credit.

Since the regulation was adopted, based on feedback and comments from affected fleets and other stakeholders, staff has also ident ified a number of other provisions of the regulation that require clarification or simpli fication. Specifically, staff is proposing to clarify the duration of the Tier 1 vehicle turnover exemption, the recordkeeping requirements for the disclosure of the regulation’s applicability, and the reporting requirements for VDECS. Staff is also proposing to simplify a minor provision in the changing of fleet size requirements. These clarifi cations are necessary for successful implementation of the regulation.

D. Proposed Modifications
Staff is proposing the following modifications to t he regulation:

• Extend the double credit for early PM retrofits de adline by 10 months from March 1, 2009 to January 1, 2010;

• Modify the changing fleet size requirements to not penalize fleets that change from small fleets to larger fleets, and then subseq uently become a small fleet again;

• Clarify that all sellers, and not just dealers, of off-road vehicles must maintain records of the disclosure of regulation applicabili ty;

• Clarify that the provision for delay of Tier 1 tur nover exempts Tier 1 vehicles from turnover only until the March 1, 2012, compliance d eadline; and

15 The pie chart on the left shows the estimated perc ent of fleets that could have retrofit 10 percent of more of their fleet hp with VDECS verifi ed before mid-October 2008. The pie chart on the right shows the percent of fleets that could do so with VDECS verified as of mid-October 2008.34

• Clarify the reporting requirements for VDECS.

In addition to the aforementioned modifications, tw o minor changes to the off-road regulation were proposed as part of the regulatory package for Proposed Regulation for In-Use On-Road Diesel Vehicles: (1) the clarificati on to the low-use provisions, and (2) the addition of all two engine cranes to the off-ro ad regulation. These changes are scheduled to be considered by the Board at the Dece mber 11, 2008, Board hearing. For more information regarding these proposed chang es, please see Chapter V. of the Staff Report for the Proposed Regulation for In-Use On-Road Diesel Vehicles (ARB, 2008c).

A more detailed discussion of the modifications sta ff is proposing is provided below.

1. Change early double credit deadline
This change would extend the deadline for earning d ouble PM BACT credit in section 2449.2(a)(2)(A)2.a.i. from March 1, 2009, to Januar y 1, 2010. The change would also mean that VDECS ordered by September 1, 2009, would receive double credit even if manufacturer or installer delays cause installation of the VDECS to be delayed beyond January 1, 2010. Additionally, this change would al low fleets more time to accumulate early PM credit and take greater advantage of recen tly verified DECS. Utilizing early PM credit would provide fleets with more time to mo re effectively spread out the initially compliance costs of the regulation. Also, adding 1 0 months to the early double PM credit deadline would allow more time for additiona l off-road verifications to be completed.

2. Requirements for fleet size changes
Staff proposes to remove the provision in section 2 449(d)(4)(A) that requires a small fleet that becomes a medium or large fleet, and the n subsequently reverts to a small fleet, to keep meeting the medium or large fleet re quirements for two years after its reduced total maximum horsepower once again reclass ifies it as a small fleet. This provision was initially developed to prevent fleets from taking advantage of a potential loophole under the regulation by deliberately growi ng and shrinking a fleet’s size and being subject only to the small fleet requirements. However, after further review of this requirement, staff has determined that the possible complexity of this provision in practice, especially in situations where a fleet’s size changes frequently over time, far outweighs the potential for fleets to abuse the cha nging fleet size provisions.

3. Recordkeeping requirements for disclosure of app licability
The record retention requirements in section 2449(h )(8) currently provide that only dealers must maintain records of the disclosure of the regulation applicability required by section 2449(j). In contrast, section 2449(j) r equires any person selling a vehicle with an engine subject to the regulation to include a disclosure that the vehicle sold might be subject to the regulation. The intent of section 2449(h)(8) was to parallel section 2449(j) and require the records of the disc losure to be retained by anyone required to issue a disclosure of regulation applic ability. As such, staff proposes that35

the language in 2449(h)(8) be changed to clarify th at all sellers, not just dealers, must maintain the records of the disclosure of regulatio n applicability.

4. Tier 1 delay
Section 2449.1(a)(2)(A)5. states that all vehicles with a Tier 1 or higher engine are exempt from the turnover requirement until March 1, 2013, provided that all Tier 0 vehicles in the fleet owner’s fleet that do not qua lify for exemption under section 2449.1(a)(2)(A)4. have been turned over. The inten t of this provision is to exempt Tier 1 vehicles from the turnover requirements of the regu lation until the fleet must meet their March 1, 2013, compliance deadline; that is a fleet may have to begin turning over their Tier 1 vehicles after March 1, 2012, to meet the fl eet’s March 1, 2013, compliance requirements. Staff is proposing to clarify this l anguage by stating that all vehicles with a Tier 1 or higher engine are exempt from the turno ver requirement until March 1, 2012 (instead of March 1, 2013), provided that all Tier 0 vehicles in the fleet owner’s fleet that do not qualify for exemption under section 2449.1(a )(2)(A)4. have been turned over.

5. VDECS reporting
The reporting requirements in section 2449(g)(1)(D) specify the information regarding VDECS that must be reported to ARB. Section 2449(g )(1)(D)2. requires reporting of the VDECS model. After further review of this requirem ent during development of the DOORS system, staff has determined that reporting o f just the VDECS model does not provide specific enough information to determine if the device was verified for a particular engine at the time of installation. Ins tead, it was determined that reporting of the VDECS family name is necessary for this purpose . It was also determined that reporting of the VDECS serial number is also import ant so that ARB enforcement will be able to track a particular device should there be q uestions regarding the proper functioning of the device. Reporting of the VDECS serial number data in DOORS would also facilitate transferring of information to a bu yer should a vehicle with a VDECS be sold. Therefore, staff is proposing to remove the requirement to report the VDECS model and replace it with a requirement to report t he VDECS family name and serial number. The DOORS system has been built to request the VDECS family name and serial number, so this change in the regulation wil l not require any rework for fleets that have reported early.

E. Staff Recommendation
Staff recommends that the Board adopt the proposed amendments to title 13, CCR, sections 2449 through 2449.3, as set forth in Appen dix A.3637

V. ECONOMIC IMPACTS
This chapter describes the potential economic impac ts of staff’s proposal, and specifically the provision to extend the deadline f or fleets to accrue early double PM credit for the installation of VDECS from March 1, 2009, to January 1, 2010. Staff’s other proposed modifications are clarifications to the regulation, and will not affect the compliance costs for the regulation.

A. Legal Requirements

Sections 11346.3 and 11346.5 of the Government Code require state agencies to assess the potential for adverse economic impacts o n California business enterprises and individuals when proposing to adopt or amend an y administrative regulation. The assessment shall include a consideration of the imp act of the proposed regulation on California jobs, business expansion, elimination, o r creation, and the ability of California businesses to compete.

State agencies are also required to estimate the co st or savings to any state or local agency and school districts in accordance with inst ruction adopted by the Department of Finance. This estimate is to include any nondiscret ionary costs or savings to local agencies and the costs or savings in federal fundin g to the state.

B. Methodology
To examine the potential economic impacts of the pr oposed regulation modifications, staff evaluated the impact of the proposed changes on individual fleets, as well as on the total statewide cost of the regulation.

1. Individual fleet analysis
To estimate the compliance costs for fleets under t he proposed modifications, staff reevaluated a previous analysis of an actual rental company fleet that shared its fleet information with staff during the development of th e original rulemaking. Staff used average costs for repowers, vehicle replacements, a nd retrofits as outlined in that Staff Report and the TSD (ARB, 2007a; ARB 2007b). The re sults of this analysis are provided in Section C below.

2. Statewide cost analysis
To estimate the average statewide costs of the prop osed modifications, staff used the ARB Off-Road Compliance Model (the model) previousl y used to estimate the statewide costs of the regulation. This model is described i n detail in Chapter XI and Appendix H of the TSD (ARB, 2007b). As a bounding exercise, s taff used the model to calculate the statewide costs of a scenario in which all large fl eets took advantage of the proposed extended early PM VDECS credit. The results were t hen compared to the costs of a scenario where no early PM VDECS credit was utilize d. The results of this analysis are provided in Section C below.38

C. Economic Impacts of Proposed Modifications
1. Individual fleet analysis results
In the Final Statement of Reasons (FSOR) prepared f or the initial adoption of the regulation, and the 2007 Board Hearing presentation , staff stated that the installation of early PM VDECS and the receipt of credits would hel p fleets spread out early compliance costs (ARB, 2007e; ARB, 2008a). However , because there were fewer VDECS available than staff anticipated at that time , fleets have not been able to fully utilize this credit, making the regulation less aff ordable for many fleets.

For example, for the rental fleet modeled, staff fo und that they could reduce their PM compliance requirements significantly in the beginn ing years of the regulation by taking early actions, and receiving early double PM credit (ARB, 2007e). In modeling the fleet’s costs, staff assumed that one advantageous compliance path that the fleet could take would be to repower seven percent of its horse power with engines meeting the Tier 1 standard and have these vehicles retrofitted with VDECS prior to March 1, 2009. Following this compliance path with early retrofits would enable this fleet to build up early retrofit credits and be able to limit the num ber of retrofits it would be required to do in subsequent years. If the fleet did not do early retrofits, it would otherwise have to retrofit 20 percent of its horsepower in each of th e first three years after compliance becomes mandatory (2010-2012). On the other hand, taking advantage of the early credit provisions the fleet would have been able to reduce its compliance costs by over $110,000, or by about seven percent, in the year wh en the maximum compliance costs occurred 16 , when compared to the scenario where it did not ut ilize the early credit provisions. Additionally, this fleet was able to r educe its 2010 compliance costs by approximately $1,400,000, or 80 percent, by utilizi ng the early credit provisions.

If the deadline for double early credit is not exte nded and this fleet cannot utilize the early credit provisions as initially envisioned by staff, it could experience up to seven percent higher maximum annual compliance costs as w ell as significantly higher compliance costs in 2010, and could find the regula tion less affordable than staff estimated in the Staff Report and TSD (ARB, 2007a, ARB, 2007b). Staff believes that many fleets are in a situation similar to that face d by the modeled fleet. Although these fleets would have liked to utilize the early credit provisions to spread out their compliance costs and lower their maximum annual com pliance costs, they have been unable to do so because of a lack of verified devic es. Overall, the proposal to extend early credit for PM VDECS would allow compliance to be more affordable for such fleets, and would not increase individual fleet cos ts above the costs estimated in the initial 2007 TSD (ARB, 2007b).

2. Statewide cost analysis
The statewide cost analysis indicates that the prop osed modification should help fleets spread out the initial costs of the regulation, wit hout increasing the total cost of the

16 For most fleets that do not utilize early credit, the maximum compliance costs will occur in 2010. However, if early credits are utilized, the maximum compliance costs will occur later during a fleet’s compliance period.39

regulation, or the costs in any given year. Staff anticipates that the proposed change would lower compliance costs in 2010, the year maxi mum annual regulation costs are expected to occur (ARB, 2007a).

The results of staff’s analysis are as follows:

• If all large fleets (those fleets with a March 1, 2010, compliance date) utilized the early credit provisions and installed retrofits in time to get double PM credit, the statewide costs in 2010 would be approximately 40 p ercent less than if no fleets performed early retrofitting; and

• The total cost of the regulation over the period 2 009 to 2030 would be approximately the same in both scenarios (all large fleets doing early retrofitting versus none doing early retrofitting).

D. Impacts on California Economy
The proposed modification to extend early double PM credit will not impose additional impacts of the regulation on the economy, nor is it expected to adversely impact employment. The modification is intended to allow fleets to spread out their compliance costs, which is expected to make the regulation mor e affordable. If in turn, that leads fewer fleets to reduce employment as a result of th e regulation, the modification could benefit total California employment.

E. Potential Impacts on Small Businesses
The proposed modification to extend early double cr edit will not impose any additional costs on small businesses. Instead, it will provide a benefit to them by providing fleets additional time to install early VDECS, and thereby accumulate PM credit that will enable them to spread out their compliance costs in later years. While staff believes most small businesses are small or medium fleets, w hich have a first compliance date in 2015 or 2013, respectively, a few small businesses meet the regulation’s definition of large fleet, which have their first compliance date in 2010. The proposed modification will benefit large fleets, and in particular small businesses that are large fleets, the most because their initial compliance date means their n eed for early PM credit is more urgent.

F. Potential Impacts on Public Agencies
The proposed modification to extend early double PM credit will not impose any additional costs on public agencies. Instead, it w ill provide a benefit to them by enabling fleets additional time to install VDECS early, and thereby accumulate PM credit that will enable them to spread out their compliance costs in later years.

The proposed modification will benefit the State, F ederal, and larger municipal fleets whose first compliance date is March 1, 2010, more than local municipalities that are small or medium fleets, because their earlier first compliance dates mean their need for early PM credit is potentially more urgent.4041

VI. ENVIRONMENTAL IMPACTS
This chapter describes the potential environmental impacts of extending early double credit for PM VDECS to January 1, 2010. The other proposed modifications are clarifications only, and will not decrease the esti mated emissions benefits of the regulation. Therefore, they were not included as p art of the analysis.

A. Legal Requirements
The legal requirements applicable to the environmen tal impact analysis are the same as those presented in the original off-road TSD (ARB, 2007b). Please see Chapter IX.A. of the off-road TSD for a description of these require ments.

The results of the environmental impact analysis fo r the proposed regulation modifications are discussed in the sections below. Alternatives to the proposed changes to the regulation are discussed in Chapter VII of this report.

B. Air Quality Impacts of Proposed Modifications
The proposed amendments will have no effect on the anticipated emission reductions of NOx, because the provisions of the regulation that will provide NOx reductions (through engine and vehicle turnover) are not proposed to be amended. Any potential change in the emission benefits of the regulation will be lim ited to PM. Because it is not possible to know exactly how many or which fleets will choos e to take advantage of the proposed extension of the early credit provisions, it is imp ossible to estimate precisely the change in anticipated PM reductions. However, staff expec ts there to be little to no overall adverse impact on air quality. To the extent that the proposed change could cause some increased emissions, overriding considerations exist for ARB to adopt the proposed changes.

If the proposed amendments cause significant number s of fleets to perform PM VDECS installations earlier than they otherwise would hav e, the proposed amendments may have a positive effect (i.e., result in reduced hea lth impact from PM emissions) because extending the early credit deadline so that it is u sable by more fleets should encourage fleets of all sizes to retrofit earlier than they o therwise would, thereby achieving immediate reductions in diesel PM. The earlier die sel PM is reduced, the more health benefits are achieved.

On the other hand, the change could also have a neg ative effect (slightly increase emissions) because if many large fleets take advant age of the double PM credit provisions, this could reduce the total number of r etrofits that would otherwise be completed by March 1, 2010.

This possible increase in emissions is tempered by the fact that activity and total vehicle horsepower, and therefore emissions, from off-road vehicles have likely been reduced to some extent due to the current economic slowdown . To date, staff has analyzed California off-road (non-taxable) diesel fuel consu mption data for 2007 and 2008 from42

the California Board of Equalization (BOE). As sho wn in Figure 5, overall off-road diesel fuel consumption in California has dropped i n 2008 17 from 2006 and 2007 consumption levels (BOE, 2008). While off-road die sel fuel consumption can provide a useful surrogate for off-road vehicle activity when combined with other data, this data alone does not provide a complete perspective, as i t also includes diesel fuel consumption from other off-road uses such as rail, stationary, marine, and agricultural (which are not subject to the regulation).

0 200,000,000 400,000,000 600,000,000 800,000,000 1,000,000,000

2004 2005 2006 2007 2008

Calendar YearDiesel Fuel Consumption(Millions of Gallons)

Figure 5: California Off-Road Diesel Vehicle Fuel C onsumption

While this data shows a decrease in overall diesel fuel consumption from all off-road sources, and is likely reflective of general trends from all users of off-road diesel fuel, the specific changes in fuel use by fleets affected by the regulation (for example, the construction industry) cannot be derived from this data.

C. Future Evaluation of Current Economic Conditions on Emissions

It is well understood that the United States econom y is currently in an economic downturn (Regalia, 2008; La Monica, 2008). In resp onse to this, staff has been investigating the effect of this downturn on the in dustries affected by the regulation, and in particular the effect of this on emissions from off-road vehicles subject to the regulation. As part of this analysis, staff is eva luating available data on vehicle activity, as well as attempting to evaluate whether fleets ma y have changed their turnover practices due to the poor economy or their inabilit y to obtain financing to comply with the regulation or take early compliance actions. S taff will present its findings at the January 2009, Board meeting.

D. Other Environmental Impacts
Staff does not believe there will be any additional environmental impacts from the proposed modifications to the regulation.

17 The 2008 fuel consumption total is an estimate bas ed on the extrapolation of off-road fuel consumption data for the first three quarters of 20 08.43

VII. ALTERNATIVES CONSIDERED
This chapter discusses the alternatives to the prop osed 10-month extension of the early double credit that staff considered and why they we re rejected in favor of the proposal. Because the proposed modifications to the other min or provisions are clarifications, staff did not perform an alternatives analysis for them.

A. Extend Early Credit Deadline, but for Less Time

First, staff considered a shorter extension of the early PM VDECS credit. Staff, however, determined that providing a shorter extens ion (only a couple of months) to the early credit deadline would not adequately address the need of fleets for additional time to purchase and install newly verified DECS. The l onger the early credit deadline can be extended, the more time fleets will have to loca te the resources they need (such as access to credit) to buy retrofits. Finally, many construction vehicles covered by the regulation are used heavily in the summer months, a nd not as much during the rainy winter months. The optimal period for fleets to da talog their vehicles is over the summer, with orders for retrofits placed before the fall. Therefore, staff believes the proposal to extend the double credit deadline to Ja nuary 1, 2010 and the double credit guarantee date to September 1, 2009, is preferable to other alternatives that would extend the deadlines by only a few months.

B. Extend Early Credit Deadline by a Full Year
Staff considered extending the early double credit for VDECS by a full year to March 1, 2010, but did not propose that option for two reaso ns. First, extending the deadline by a full year could result in a loss in emissions benef its. If the deadline were extended to March 1, 2010, this would effectively be the same a s cutting the PM BACT retrofit requirement for that year down from 20 percent to 1 0 percent 18 . If the requirement for PM BACT were changed to 10 percent per year for the 2010 compliance date only, the number of VDECS installed would effectively be cut in half. 19 Second, extending the deadline a full year could disrupt the business pla ns of retrofit manufacturers that have invested significantly so that they may provide VDE CS to fleets. If these manufacturers fail or pull out of the California market because o f a delay, that could jeopardize the regulation’s future PM benefits. For these reasons , staff did not propose extending the early credit deadline beyond January 1, 2010.

C. Give More or Less than Double Credit before Marc h 1, 2010
Staff also considered providing more than double PM credit for VDECS installed before March 1, 2009, or to give between single and double credit for VDECS installations completed between March 1, 2009, and March 1, 2010 (for example, to give one and a

18 If all large fleets received double credit for ear ly PM VDECS, they could potentially fulfill the PM BACT requirements in 2010 by only retrofitting h alf of the vehicles they would otherwise have; essentially cutting the retrofitting requirem ents from 20 percent to 10 percent.
19 This emission benefit loss could be mitigated some what, but not completely, by the decreased off-road vehicle activity due to the curr ent economic downturn.44

half credit). Staff believes such an approach woul d add significant additional recordkeeping and compliance complexity to the regu lation, while providing no additional relief to fleets relative to staff’s pro posal.

D. No Change
Staff also considered making no changes to the regu lation. However, as discussed in this report, staff believes it is necessary to prov ide fleets with additional time to purchase and install VDECS to receive early PM BACT credit. As such, making no change to this provision would not address this iss ue.45

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ARB, 2007a. California Air Resources Board. Staff Report: Initial Statement of Reasons for Proposed Rulemaking; Regulation for In-Use Off- Road Diesel Vehicles . California Air Resources Board, April 2007. http://www.arb.ca.gov/regact/2007/ordiesl07/isor.pd f

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ARB, 2008b. California Air Resources Board. Carl M oyer Program Advisory: 08-006 – Off-Road Construction Contract Extension. Californi a Air Resources Board, August 15, 2008. http://www.arb.ca.gov/msprog/moyer/advisories_005/0 8-006_extension.pdf

ARB, 2008c. California Air Resources Board. Staff Report: Initial Statement of Reasons for Proposed Rulemaking; Regulation for In-Use On-R oad Diesel Vehicles . California Air Resources Board, October 2008. http://www.arb.ca.gov/regact/2008/truckbus08/tbisor .pdf46

ARB, 2008d. California Air Resources Board. Off-R oad Certification Database. Last accessed on November 24, 2008. Available at http://www.arb.ca.gov/msprog/offroad/cert/cert.php

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ATA, 2008. ATA, 2008. Air Transport Association. PowerPoint presentation entitled Commercial Aviation: The Brakes are On, John Heimli ch, VP & Chief Economist - Air Transport Association, November 5, 2008.

BOE, 2008. Email communication between Michael Bak er, ARB, and Phillip Bishop of the State Board of Equalization, Fuel Taxes Divisio n. November 7, 2008.

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Bruenke, 2007a. Letter from Peter Bruenke, Huss, L LC, to Mike Hulse, ARB. Nonfeasible Installation; Caterpillar machines. Octobe r 25, 2007. http://www.arb.ca.gov/msprog/moyer/retrofit/exempti ons.htm

Bruenke, 2007b. Letter from Peter Bruenke, Huss, L LC, to Rob Cram, Holt of California. Non-feasible Installation; Cat 769 Haul truck. December 12, 2007. http://www.arb.ca.gov/msprog/moyer/retrofit/exempti ons.htm

Bruenke, 2008a. Letter from Peter Bruenke, Huss, L LC, to Mike Hulse, Peterson Tractor Co. Non-feasible Installation; Caterpillar D6K dozer. April 11, 2008. http://www.arb.ca.gov/msprog/moyer/retrofit/exempti ons.htm

Bruenke, 2008b. Letter from Peter Bruenke, Huss, L LC, to Johanna Levine, ARB. Revoking the previous HUSS exemption letters. May 5 , 2008. http://www.arb.ca.gov/msprog/moyer/retrofit/exempti ons.htm

Bruenke, 2008c. Letter from Peter Bruenke, Huss, L LC, to John Rubiales, Peterson Tractor Co. Non-feasible Installation; Caterpillar D8L dozer. May 21, 2008. http://www.arb.ca.gov/msprog/moyer/retrofit/exempti ons.htm

Bruenke, 2008d. Letter from Peter Bruenke, Huss, L LC, to John Rubiales, Peterson Tractor Co. and Johanna Levine, ARB. Non-feasible I nstallation; Caterpillar 992C. June 13, 2008. http://www.arb.ca.gov/msprog/moyer/retrofit/exempti ons.htm

CARL, 2008. Retrieved on Sept. 25, 2008, from the Carl Moyer Program Project Database (CARL).47

CIRB, 2008. Construction Industry Research Board. California Public Works Construction; Public Buildings & Heavy Construction . Construction Industry Research Board, September 24, 2008.

Cox, 2008. Personal communication between Charlie C ox of Ironman and Elizabeth Yura, ARB; September 23, 2008.

Cram, 2008. Personal communication between Rob Cra m of Holt of California, and Kim Heroy-Rogalski, ARB. September 25, 2008.

Cross, 2008a. Letter from Robert Cross, CARB, to J oe Alexio, DCL International Incorporated. Conditional Verification of DCL Mine -X Sootfilter. January 24, 2008. http://www.arb.ca.gov/diesel/verdev/level3/dcl_veri ficationletter.pdf

Cross, 2008b. Letter from Robert Cross, CARB, to K evin Brown, Engine Control Systems, Limited. Conditional Verification of ECS Purifilter TM . October 20, 2008. http://www.arb.ca.gov/diesel/verdev/pdf/conditional /08-661-379.pdf

Cross, 2008c. Letter from Robert Cross, CARB, to G len Luksik, Caterpillar Emissions Solutions. Conditional Verification of Caterpillar Diesel Particulate Filter. March 7, 2008. http://www.arb.ca.gov/diesel/verdev/pdf/conditional /08-661-096.pdf

DOF, 2008a. California Department of Finance. California Economic Indicators: March – April 2008; Housing Still Weighs . California Department of Finance. Last accessed November 4, 2008. http://www.dof.ca.gov/HTML/FS_DATA/INDICATR/2008_CE I/CEI%200804.pdf

DOF, 2008b. California Department of Finance. Cali fornia Economic Indicators: July/Aug 2008. Microsoft Excel Spreadsheet. Califor nia Department of Finance. Last accessed November 4, 2008. http://www.dof.ca.gov/HTML/FS_DATA/INDICATR/Ei_home .htm

ET, 2008 The Economic Times. US puts $700 bn bailo ut plan on fast track. The Economic Times November 7 2008 http://economictimes.indiatimes.com/News/Internatio nal_Business/US_puts_700_bn_ba ilout_plan_on_fast_track/rssarticleshow/3683697.cms

Gamez, 2008. Gamez, Saul. San Joaquin Valley Unified Air Pollution Control Di strict: Rule 9210 Staff Report. August 27, 2008. http://www.valleyair.org/Workshops/postings/2008/08 -27- 08_9210/R9210_staffreport_W2.pdf

Gentile, 2008. Gentile, Ralph. Outlook 2008, Exclusive Report: California Construc tion Mid-Year Update . The McGraw-Hill Companies, Inc., June 2008.

Halloran, 2008. Personal communication between Jame s Halloran of Caterpillar, Inc., and Cory Parmer, ARB; October 16, 2008.48

Jerman, 2008. Personal communication between David Jerman of DCL International Inc., and Cory Parmer, ARB; October 17, 2008.

La Monica, 2008. La Monica, Paul. Call it a recess ion, already. CNN Money. Last accessed November 14, 2008. http://money.cnn.com/2008/11/07/markets/thebuzz/ind ex.htm

Luksik, 2008. Letter from Glenn M. Luksik, Caterpi llar, Inc., to Rob Cram, Holt of California and Johanna Levine, ARB. DPF Exemption; Caterpillar Motor Graders. June 30, 2008. http://www.arb.ca.gov/msprog/moyer/retrofit/exempti ons.htm

.
Ostrander, 2008. Personal communication between Je ramy Ostrander of Diesel Exhaust and Emissions, LLC, and Elizabeth Yura, ARB ; September 24, 2008.

Pasek, 2008. Pasek, Randall. South Coast AQMD SOO N and Moyer Incentive Programs. Presented at South Coast SOON Workshop. A ugust 27, 2008. http://www.aqmd.gov/tao/implementation/SOONworkshop 081408.pdf

Porcher, 2008. Personal communication from Dave Po rcher, Camarillo Engineering, Chair of Off-Road Implementation Advisory Group (OR IAG) Fleet Subcommittee, at ORIAG meeting in Sacramento, CA. September 26, 2008

. Regalia, 2008. Regalia, Martin. Recession! US Cham ber Magazine. Last accessed November 14, 2008. http://www.uschambermagazine.com/content/0811_econ. htm

SCAQMD, 2008. South Coast AQMD Program Announcemen t #2008-09. Last accessed on November 3, 2008. http://www.aqmd.gov/rfp/attachments/2008/PA2008-09. doc

Surma, 2008. Personal communication between Phillip Surma of HUSS, LLC, and Cory Parmer, ARB; October 16, 2008.

Swenson, 2008. Personal communication between Tom S wenson of Cleaire Advanced Emissions Controls, LLC, and Cory Parmer, ARB; Octo ber 16, 2008.

U.S. EPA, 2008a. California Authorization Request for Emission Standards for Off-road Diesel-fueled fleets, Docket ID No. EPA-HQ- OAR-200 8-0691, 73 Federal Register 58585, October 7, 2008.

U.S. EPA, 2008b. California Authorization Request for Emission Standards for Off-road Diesel-fueled fleets; Extension of Comment Period, Docket ID No. EPA-HQ- OAR-2008- 0691, 73 Federal Register 67509, November 14, 2008.

White, 2008. Letter from Erik White, ARB, to Samir Sheikh, South Coast Air Quality Management District. October 15, 2008.49

Yardemian, 2008. Email communication between Dinh Quach, ARB, and Vasken Yardemian of the South Coast Air Quality Management District. October 29, 2008.

Yengst, 2005. Yengst Associates Machinery Market R esearch. Equipment Analysis North America. June, 2005.5051

APPENDIX A: PROPOSED REGULATION ORDER FOR IN-USE OF F-ROAD

DIESEL-FUELED FLEETS

Note: Proposed modifications are shown in underlin e to indicate additions and strikeout to indicate deletions, compared to the preexisting regulatory language. The symbol “*****” indicates that regulatory langua ge not being amended is not shown.

Amend sections 2449, 2449.1, and 2449.2, title 13, California Code of Regulation to read as follows.



### § 2449 General Requirements for In-Use Off-Road Dies el-Fueled Fleets

***** (d) Performance Requirements - ***** (4) Changing Fleet Size – (A) Small fleets that become medium or large fleets must meet the medium or large fleet requirements, respectively, on the repo rting date two years subsequent to the year they became a medium or larg e fleet. If such fleets become small again, they must keep meeting the medi um or large fleet requirements for two years after becoming a small fleet. (B) Large fleets that become medium fleets may meet either the medium or large fleet requirements on the next reporting date. Lar ge fleets that become small fleets may meet either the small or large fleet req uirements on the next reporting date. (C) Medium fleets that become small fleets may meet either the small or medium fleet requirements on the next reporting date. Med ium fleets that become large fleets must meet the large fleet requirements on the reporting date two years subsequent to the year they became a large fl eet.

*****

(g) Reporting

– Reporting is required for each and every fleet. La rge and medium fleets may report separately for different divisions or subsidiaries of a given company or agency. Fleet owners may submit reporting information using forms (paper or electronic) approved by the Executive Officer.

(1) Initial reporting

– All fleet owners must submit the information in section 2449(g)(1)(A) through (G) to ARB by their initial r eporting date. In the initial reporting, fleet owners must report information reg arding each vehicle subject to this regulation that was in their fleet on March 1, 2009. Systems or non-diesel52

fueled vehicles that are used in place of a vehicle that would be subject to this regulation must also be reported. The initial repo rting date for large fleets is April 1, 2009. The initial reporting date for medium fle ets is June 1, 2009. The initial reporting date for small fleets is August 1, 2009. Reports must include the following information: ***** (D) Verified Diesel Emission Control Strategies - For each VDECS that is installed on an engine listed per section 2449(g)(1 )(C) report the following information. 1. VDECS Manufacturer; 2. VDECS Model Family ; 3. Verification level; 4. Verified percent NOx reduction (if any); 5. Date installed; 6. VDECS Serial Number.

*****

(h) Record keeping

– Fleet owners must maintain copies of the informatio n reported under section 2449(g), as well as the records described in section 2449(h) below, and provide them to an agent or employee of the ARB within five business days up on request. Records must be kept at a location within the State of California. ***** (8) Record Retention

– Each fleet owner shall maintain the records for each vehicle subject to the regulation until it is retired and f or the overall fleet as long as the owner has a fleet or March 1, 2030, whichever is ea rlier. If vehicle ownership is transferred, the seller shall convey the vehicle re cords including vehicle data per section 2449(g)(1)(B), engine data per section 2449 (g)(1)(C), and VDECS data per section 2449(g)(1)(D) to the buyer. If fleet o wnership is transferred, the seller shall convey the fleet records including fle et data per sections 2449(g)(1)(A) through (G) to the buyer. Dealers Any person selling a vehicle with an engine subject to this regulation in Califo rnia must maintain records of the disclosure of regulation applicability required by Section 2449(j) for three years after the sale.

*****

Note: Authority cited: Sections 39002, 39515, 39516 , 39600, 39601, 39602, 39650, 39656, 39658, 39659, 39665, 39667, 39674, 39675, 40 000, 41511, 42400, 42400.1, 42400.2, 42400.3.5, 42402, 42402.1, 42402.2, 42402. 4, 42403, 43000, 43000.5, 43013, 43016, and 43018, Health and Safety Code. Reference : Sections 39002, 39515, 39516, 39600, 39601, 39602, 39650, 39656, 39657, 39658, 39 659, 39665, 39667, 39674, 39675, 40000, 41511, 42400, 42400.1, 42400.2, 42402 .2, 43000, 43000.5, 43013, 43016, and 43018, Health and Safety Code.53

§ 2449.1 NOx Performance Requirements

(a) Performance Requirements ***** (2) BACT Requirements ***** (A) Turnover Requirements for Fleets Not Meeting NO x Target Rate – A fleet may meet the turnover requirements by retiring a ve hicle, designating a vehicle as a low-use vehicle, repowering a vehicle, rebuilding the engine to a more stringent emissions configuration, or applying a VDECS verified to achieve NOx reductions. If repowering a vehicle or rebuilding the engine to a more stringent emissions configuration, the new eng ine must be Tier 2 or higher and must be a higher tier than the engine re placed or rebuilt. The method for counting VDECS verified to achieve NOx r eductions is specified in section 2449.1(a)(2)(A)8. ***** 5. Delay Tier 1 turnover - All vehicles with a Tier 1 or higher engine are exempt from the turnover requirement until the comp liance year ending March 1, 2013 (i.e., the first turnover of Tier 1 o r higher engines would be required between March 2, 2012 and March 1, 2013) , provided that all Tier 0 vehicles in the fleet owner’s fleet that do not q ualify for an exemption under section 2449.1(a)(2)(A)4. have been turned ov er.

***** Note: Authority cited: Sections 39002, 39515, 39516 , 39600, 39601, 39602, 43000, 43000.5, 43013, 43016, and 43018, Health and Safety Code. Reference: Sections 39002, 39515, 39516, 39600, 39601, 39602, 39650, 39 656, 39657, 39658, 39659, 39665, 39667, 43000, 43000.5, 43013, 43016, and 430 18, Health and Safety Code.



### § 2449.2 PM Performance Requirements ***** (a) Performance Requirements ***** (2) BACT Requirements ***** (A) PM Retrofit Requirements for Fleets Not Meeting Diesel PM Target Rate

***** 2. Carryover PM retrofit credit – a. Beginning - All fleets other than those meeting the criteria in (i) or (ii) below for vehicles remaining in their fleets begin with zero carryover retrofit credit on March 1, 2009. i. Double Credit for Early PM Retrofits – Fleets that have installed the highest level VDECS on their vehicles before Ja nuary 1, 2010 March 1, 2009 begin with a carryover retrofit credit equal to: 254 multiplied by total maximum power of engines on whi ch highest level VDECS was installed before January 1, 2010 March 1, 2009

, unless the contract for funding the VDECS stipulate s single credit for installation of the VDECS. ii. Single Credit for Other PM Retrofits Before Ini tial Compliance Date – Medium fleets that install highest level VDECS on their vehicles between January 1, 2010 March 1, 2009 and February 29, 2012 accumulate carryover retrofit credit equal to total maximum power of engines on which highest level VDE CS was installed. Small fleets that install highest level VDECS on their vehicles between January 1, 2010 March 1, 2009 and February 28, 2014 accumulate carryover retrofit credit equal to total maximum power of engines on which highest level VDE CS was installed. b. Accumulating carryover PM retrofit credit – Beginning March 1, 2011 2010 for large fleets, March 1, 2013 for medium fleets, and March 1, 2015 for small fleets, a fleet accumulates carryover retrofit credit each year it retrofits more than 20 percent of its maximum power. The amount accumulated is the percent of m aximum power retrofit in excess of 20 percent in the past 12 mon ths prior to March 1. A large fleet also accumulates carryover retrofit c redit on March 1, 2010 if the sum of the double retrofit credit earne d from March 1, 2009 to January 1, 2010 plus the single retrofit credit earned from January 1, 2010 to March 1, 2010 exceeds 20 percent of its maximum horsepower. The amount accumulated is the sum of d ouble credit retrofit credit earned from March 1, 2009 to Januar y 1, 2010 plus the single credit earned from January 1, 2010 to March 1, 2010 in excess of 20 percent of fleet’s maximum horsepower in the past 12 months.

***** Note: Authority cited: Sections 39002, 39515, 39516 , 39600, 39601, 39602, 39650, 39656, 39658, 39659, 39665, 39667, 39674, 39675, 40 000, 41511, 42400, 42400.1, 42400.2, 42400.3.5, 42402, 42402.1, 42402.2, 42402. 4, 42403, 43000, 43000.5, 43013, 43016, and 43018, Health and Safety Code. Reference : Sections 39002, 39515, 39516, 39600, 39601, 39602, 39650, 39656, 39657, 39658, 39 659, 39665, 39667, 39674, 39675, 40000, 41511, 42400, 42400.1, 42400.2, 42402 .2, 43000, 43000.5, 43013, 43016, and 43018, Health and Safety Code.55

APPENDIX B: ASSUMPTIONS FOR STATEWIDE FLEET RETROFI TTING

ANALYSIS

This appendix provides the assumptions and methodol ogies used to estimate Verified Diesel Emission Control System (VDECS) applicabilit y.

ARB estimated the in-use off-road diesel vehicle po pulation that could have VDECS installed for three specific cases; (1) the percent age of vehicles that could have any of the current verified devices installed, (2) the per centage of vehicles that could have passively regenerated VDECS installed today, and (3 ) the percentage of vehicles that could have had passively regenerated VDECS installe d more than two weeks prior to the deadline for guaranteed double retrofit credit as of mid-October 2008.

To develop this estimate, staff used the following information:

• The verification letters (also referred to as Exec utive Orders) for each off-road VDECS. The Executive Orders specify the horsepower , model year, emissions levels, and whether the device can be used with eng ines equipped with exhaust gas recirculation (EGR).

• Letters from VDECS manufacturers exempting certain vehicle types or models from retrofitting under the Carl Moyer program (Bru enke, 2007a; Bruenke, 2007b; Bruenke, 2008a; Bruenke, 2008b; Bruenke, 2008c; Bru enke, 2008d; Luksik, 2008). Staff’s analysis assumes that such exempted vehicle types or models cannot be retrofit.

Staff based the estimate of VDECS applicability on horsepower (hp), particulate matter (PM) emissions limit, and engine model years. Staf f chose these parameters because these are the most important factors limiting verif ications and because this data is available in the ARB emissions inventory model (the OFFROAD model). Each VDECS has a number of other requirements which would prev ent it from being applied to a particular engine/vehicle combination, including bu t not limited to:

• specific exemptions or inclusions by engine family name,

• use of fuel additives,

• poor engine conditions with excessive emissions,

• insufficient exhaust pressure for the device,

• no appropriate or safe means of installing the dev ice on the vehicle infrastructure,

• exclusion due to the use tracks instead of rubber tires,

• lack of available electrical power for actively re generated VDECS, and

• inadequate exhaust temperature for passive VDECS.

These factors would need to be considered for each engine not initially ruled out based on hp, PM emissions, and model year. The factors l isted above are not included in the ARB emissions inventory model (the OFFROAD model), nor does staff have access to other vehicle or engine population data that would allow the factors above to be factored into an overall estimate of VDECS applicability. A n estimation on the effect of these factors on the breadth of VDECS applicability is un likely to be accurate without an in-56

depth inspection, including data logging, of a size able portion of California’s inventory of off-road equipment. Therefore, it is important to note that the estimations of VDECS applicability below refer only to the engines which are not initially ruled out by the age, PM emissions, and size of the engine. The estimate s should be considered upper bounds on the fraction of vehicle horsepower to whi ch retrofits could be applied.

Passive and Active Retrofits

To determine the percentage of vehicles which could have any currently verified or conditionally verified device installed, staff revi ewed the breadth of the VDECS verifications for all verified devices. Staff conc luded that the HUSS Umwelttechnik GmbHFS-MK Series Diesel Particulate Filter (Huss DP F), which is a level 3 actively regenerated device, is the device with the widest a pplicability. In fact, the Huss device is verified for virtually any engine, regardless of age, horsepower or emission levels, with the exception of engines using exhaust gas rec irculation and vehicles exempted specifically from retrofitting under the Carl Moyer program. The engines specifically exempted from the Huss verification can in most cas es be retrofit by an alternative device, hence the only engines which can be entirel y ruled out from receiving any of the currently verified retrofit devices are those using exhaust gas recirculation.

Based on staff’s analysis, the only manufacturer wi th a substantive market share of the applicable engines in California using exhaust gas recirculation in all or most of their equipment in any given year was Volvo, in 2006 and later model year engines. Although other manufacturers have used exhaust gas recirculation, they did not do so in quantities which would justify removing all of thei r engine lines from the engines which could be retrofit.

The market share of Volvo in off-road construction application was determined by industry reports from the Yengst Associates (Yengst , 2005). The model years for Volvo engines using EGR were accounted for based on the e stimated useful life of the equipment types using Volvo engines (ARB, 2007b).

Staff estimate that exhaust gas recirculation engin es comprise 0.4 percent of the offroad diesel inventory, and are the only category th at can be absolutely excluded when considering any of the available retrofits. ARB st aff acknowledges that many other vehicles and engines are not suited to be retrofit, however as stated above, most the additional exemptions would need to be identified o n a case by case basis.

Passively Regenerated Retrofits

To determine the percentage of vehicles which could have one of the passively regenerated VDECS installed, staff considered the C aterpillar DPF, DCL MINE-X Sootfilter, and the ECS Purifilter verifications on November 1, 2008 (ARB, 2008d; Cross, 2008a; Cross, 2008b). The restrictions on e ngine applicability are listed in Table 1 below.57 Table 1: Passively Regenerated Retrofit Requirement s

Caterpillar DPF DCL MINE-X Sootfilter ECS Purifilter
Horsepower Range 175 - 600 hp 175 - 300 hp 50 - 750 hp PM Emissions Limit 0.2 g/bhp-hr 0.15 g/bhp-hr 0.2 g/bhp-hr
Engine Model Years 1996 - 2008 1996 - 2008 1996 - 2008

The PM emissions limits are applied to the engine’s certification level , not the certification standard. Although the standards did not require engines to meet a limit of 0.2 g/bhp-hr for PM until 2001 at the earliest, man y engines tested at or below 0.2 g/bhp-hr as early as 1996 (ARB, 2008e), and could h ave one of the passive devices list above installed. Although many engines test above these standards, no specific model year of 1996 or later, or horsepower category, can be excluded, as each category has at least a few engines which meet the standard.

Comparing the applicability requirements, staff fil tered the off-road inventory (ARB, 2006) for all vehicles between 50 and 750 horsepowe r, for Tier 1 or newer engine models. Engines using exhaust gas recirculation we re also discounted, using the method described previously for active and passive retrofits.

Staff estimate that 41 percent of the off-road dies el horsepower covered by the regulation could not have a passive device installe d currently due to restriction on hp, model year and emissions. As stated previously, of the remaining 59 percent of California’s horsepower, staff expect that the fact ors such as engine condition, installation issues, and duty cycle would further r educe the amount of vehicles that could be retrofit with a passive device, however th e engine would need to be evaluated on an individual basis.

Passively Regenerated Retrofits Available Mid-Octob er 2008 for Double Retrofit Credit

Staff also wanted to determine the percentage of ve hicles that could have had a passively regenerated retrofit installed at least t wo weeks prior to the deadline to guarantee double retrofit credit, November 1, 2008. This entailed removing the ECS Purifilter which was verified on October 20, 2008 a nd the extension of the Caterpillar DPF, which had the verification expanded on October 24, 2008. Table 2 below shows the applicability requirements for the Caterpillar DPF and DCL MINE-X Sootfilter prior to the expansion of verification (Cross, 2008a; Cross, 2008c).58

Table 2: Limited Caterpillar DPF and DCL Sootfilter Requirements

Caterpillar DPF DCL MINE-X Sootfilter Horsepower Range 175 - 300 hp 175 - 300 hp PM Emissions Limit 0.2 g/bhp-hr 0.15 g/bhp-hr
Engine Model Years 1996 - 2008 1996 - 2008

Additionally, both retrofits were only verified for rubber-tired applications. Although many vehicle categories are comprised of both rubbe r tired and track vehicles, only the crawler tractor category can be assumed to be compr ised solely of track vehicles and can be completely ruled out.

Comparing the applicability requirements, staff fil tered the off-road inventory (ARB, 2006) for all vehicles between 175 and 300 horsepow er, for Tier 1 or newer engines, and excluded crawler tractors. Engines that used e xhaust gas recirculation were also discounted, using the method described above for ac tive and passive retrofits.

Staff estimate that 89 percent of the off-road dies el horsepower covered by the regulation could not be retrofit with one of the pa ssively regenerated devices installed prior to mid-October, 2008, based on horsepower, mo del year, and emissions. As with the previous analysis, the remaining 11 percent wou ld need to be evaluated on individual basis.

HUSS Exemptions by Vehicle Model

The effect of HUSS exemptions (Bruenke, 2007a; Brue nke, 2007b; Bruenke, 2008a; Bruenke, 2008b; Bruenke, 2008c; Bruenke, 2008d; Luk sik, 2008) on the statewide fleet was estimated using information from the Machinery Trader auction site ( www.machinerytrader.com ). The market share of applicable engine models wa s estimated by comparing the number of specific vehic le models for sale against the total number of vehicles for sale in that vehicle categor y (for example, Cat 769 off-road trucks were 3.5 percent of the total off-road truck s for sale on Machinery Trader on November 24, 2008. These market share estimates we re applied to the total vehicle type populations in ARB’s off-road inventory (ARB, 2007) to estimate the number of vehicles and horsepower currently used in Californi a that would fall under the HUSS exemptions. The total horsepower of exempted vehic les was compared against the total statewide horsepower (ARB, 2006) to determine the percent of statewide horsepower affected by the HUSS exemptions.

References

All references for this appendix can be found in Ch apter VIII.59

APPENDIX C: SHOWCASE AND SEP

Table 1: Showcase Retrofits Installed as of Novembe r 2008

Year HP Tier Vehicle Type Installed Device Type of Device 1995 275 0 Rubber Tired Loader CAT - EUG/DPF Passiv e 2003 255 2 Crawler Tractor DCL MINE-X Passive 1997 400 1 Scraper DCL MINE-X Passive 1997 559 1 Scraper DCL MINE-X Passive 1997 400 1 Scraper DCL MINE-X Passive 1997 559 1 Scraper DCL MINE-X Passive 2004 95 2 Tractor/Loader/Backhoe JM-CRT Passive

1994 168 0 Excavator Sud Chemie ENVICAT Passive

1999 222 1 Excavator Sud Chemie ENVICAT Passive

Table 2: Showcase Retrofits Planned for Installatio n

Year HP Tier Vehicle Type Installed Device Type of

Device

2006 405 3 Crawler Tractor CDT PermitFBC Passive FBC

1997 67 0 Tractor/Loader/Backhoe Dinex DiNox Passive+NOx Control 2002 73 1 Tractor/Loader/Backhoe Dinex-Dipex Passiv e

1992 134 0 Rubber Tired Loader Dinex DiNox Passive+NOx Control 2001 62 1 Rubber Tired Loader Dinex-Dipex Passive

1992 375 0 Rubber Tired Loader Mann Hummel FBC Passive FBC

2001 107 1 Rough Terrain Forklift Nett Tech - Active SCR Active+NOx

Control
2001 109 1 Rough Terrain Forklift Nett Tech - Active SCR Active+NOx

Control
2002 123 1 Rough Terrain Forklift Nett Tech - Active SCR Active+NOx

Control

1998 312 1 Excavator Nett Tech - Passive SCR Passive+NOx

Control

1990 270 0 Wheel Loader Nett Tech - Active SCR Active+NOx

Control

2000 178 1 Excavator Nett Tech - Active SCR Active+NOx

Control

2000 222 1 Excavator Nett Tech - Passive SCR Passive+NOx

Control60

Year HP Tier Vehicle Type Installed Device Type of

Device

1991 375 0 Excavator Extengine ADECII Active+NOx

Control

1991 250 0 Excavator Recat-ESW DC-100 Active+FBC

1984 350 0 Excavator Sud Chemie ENVICAT Passive

2002 692 1 Excavator Sud Chemie ENVICAT Passive

1986 552 0 Rubber Tired Dozer Extengine ADECII Active+NOx

Control
1997 400 1 Scraper, Rear Extengine ADECII Active+NOx

Control
1986 400 0 Scraper, Rear Extengine ADECII Active+NOx

Control
1997 552 1 Scraper, Front Extengine ADECII Active+NOx

Control
1986 596 0 Scraper, Front Extengine ADECII Active+NOx

Control

1997 275 1 Motor Grader Nett TechPassive SCR Passive+NOx

Control

1996 177 1 Crawler Tractor CDT FBCDPF Passive+FBC

1998 75 1 Off-Highway Tractors CDT FBCDPF Passive+FBC

1998 75 1 Off-Highway Tractors CDT FBCDPF Passive+FBC

2006 120 2 Off-Highway Tractors CDT FBCDPF Passive+FBC

1997 120 1 Off-Highway Tractors CDT FBCDPF Passive+FBC

1996 177 1 Crawler Tractor CDT PermitFBC Passive+FBC

1997 95 0 Off-Highway Tractors CDT PermitFBC Passive+FBC

1993 136 0 Rubber Tired Loader CDT PermitFBC Passive+FBC

1996 170 0 Rubber Tired Loader CDT PermitFBC Passive+FBC

2006 91 2 Tractor/Loader/Backhoe

s CDT PermitFBC Passive+FBC

1998 75 1 Off-Highway Tractors CDT Platinum Plus Purifilter Filter Passive+FBC

1998 75 1 Off-Highway Tractors CDT Platinum Passive +FBC61

Year HP Tier Vehicle Type Installed Device Type of

Device Plus Purifilter Filter

1999 109 1 Off-Highway Tractors CDT Platinum Plus Purifilter Filter Passive+FBC

1996 145 0 Rubber Tired Loader CDT Platinum Plus Purifilter Filter Passive+FBC

1993 120 0 Off-Highway Tractors DCL Mine-X Passive 1995 120 0 Off-Highway Tractors DCL Mine-X Passive 1993 136 0 Rubber Tired Loader DCL Mine-X Passive 1992 136 0 Rubber Tired Loader DCL Mine-X Passive 1995 190 0 Rubber Tired Loader DCL Mine-X Passive 2006 75 2 Tractor/Loader/Backhoe DCL Mine-X Passive 2006 75 2 Tractor/Loader/Backhoe DCL Mine-X Passive 1992 170 0 Rubber Tired Loader Dinex-Dipex Passive
2001 108 1 Off-Highway Tractors Donaldson Passive DPF Passive

2001 110 1 Off-Highway Tractors Donaldson Passive DPF Passive

2004 129 2 Rubber Tired Loader Donaldson Passive DPF Passive

2004 170 2 Rubber Tired Loader Donaldson Passive DPF Passive

1995 120 0 Paver ECS Assisted Purifilter Active+Electric

1993 81 0 Rubber Tired Loader ECS Assisted Purifilter Active+Electric

1993 136 0 Rubber Tired Loader ECS Assisted Purifilter Active+Electric

1992 136 0 Rubber Tired Loader ECS Assisted Purifilter Active+Electric

1993 75 0 Tractor/Loader/Backhoe ECS Assisted Purifilter Active+Electric
1999 89 1 Off-Highway Tractors ECS Purifilter Passi ve 1999 89 1 Off-Highway Tractors ECS Purifilter Passi ve 1995 120 0 Off-Highway Tractors ECS Purifilter Pass ive 1995 120 0 Off-Highway Tractors ECS Purifilter Pass ive 1992 136 0 Rubber Tired Loader ECS Purifilter Passi ve 2004 173 2 Rubber Tired Loader ECS Purifilter Passi ve 2003 205 2 Rubber Tired Loader ECS Purifilter Passi ve 1993 75 0 Tractor/Loader/Backhoe ECS Purifilter Pas sive 1995 105 0 Crawler Tractor Huss FS-MD Active 2002 75 1 Off-Highway Tractors Huss FS-MD Active62

Year HP Tier Vehicle Type Installed Device Type of

Device

1995 76 0 Other Mobile Off-Road Vehicle Huss FS-MD Active

1992 136 0 Rubber Tired Loader Huss FS-MD Active

1993 190 0 Rubber Tired Loader Mann-Hummel FBC Passive+FBC

2006 75 2 Off-Highway Tractors Mann-Hummel SMF-AR Active+FBC+

Electric
1998 83 1 Off-Highway Tractors Mann-Hummel SMF-AR Active+FBC+

Electric
1999 95 1 Off-Highway Tractors Mann-Hummel SMF-AR Active+FBC+

Electric

2001 75 1 Tractor/Loader/Backhoe Mann-Hummel SMF-AR Active+FBC+

Electric
1993 120 0 Off-Highway Tractors Mann-Hummel SMF-AR Active+FBC+

Electric
1998 75 1 Off-Highway Tractors Nett TechActive SCR Active+NOx

Control
2000 105 1 Off-Highway Tractors Nett TechActive SCR Active+NOx

Control

1996 150 0 Rubber Tired Loader Nett TechActive SCR Active+NOx

Control

2004 194 2 Rubber Tired Loader Nett TechActive SCR Active+NOx

Control

2004 194 2 Rubber Tired Loader Nett TechActive SCR Active+NOx

Control
1997 120 1 Off-Highway Tractors Nett TechPassive SCR Passive+NOx

Control

1996 150 0 Rubber Tired Loader Nett TechPassive SCR Passive+NOx

Control
1999 109 1 Off-Highway Tractors Rypos HDPF/C Active+Electric

2003 116 2 Off-Highway Tractors Rypos HDPF/C Active+Electric

1999 89 1 Off-Highway Tractors Sud Chemie ENVICAT Passive

1999 89 1 Off-Highway Tractors Sud Chemie ENVICAT Passive

1992 136 0 Rubber Tired Loader Sud Chemie ENVICAT Passive

2004 128 2 Rubber Tired Loader Sud Chemie ENVICAT Passive

1993 136 0 Rubber Tired Loader Sud Chemie ENVICAT Passive

1996 170 0 Wheel Loader ECS Assisted Active+Electri c63

Year HP Tier Vehicle Type Installed Device Type of

Device Purifilter 1993 220 0 Rubber Tired Loader DCL Mine-X Passive 2006 211 3 Rubber Tired Loader CAT - DPF Passive

2000 114 1 Rubber Tired Loader Nett TechActive SCR Active+NOx

Control

2004 170 2 Rubber Tired Loader CDT FBCDPF Passive+FBC

2005 260 2 Rubber Tired Loader CDT PermitFBC Passive+FBC

2001 145 1 Tractor Wheel Loader DCL MINE-X Passive

2004 170 2 Rubber Tired Loader Donaldson Passive DPF Passive

2006 160 2 Tractor Wheel Loader Extengine ADECII Active+NOx

Control 2004 90 2 Tractor Wheel Loader Huss FS-MD Active

2005 98 2 Tractor Recat - ESW DC-100 Active+FBC

2002 188 1 Excavator CDT PermitFBC Passive+FBC

2001 315 2 Rubber Tired Loader Dinex DiNox Passive+NOx Control

1998 240 1 Excavator Donaldson Active DPF Active+Electric

1999 235 1 Rubber Tired Loader Donaldson Active DPF Active+Electric
2003 66 1 Rough Terrain Forklift ECS Purifilter Pas sive

1994 200 0 Rubber Tired Loader Extengine ADECII Active+NOx

Control

1994 200 0 Rubber Tired Loader Extengine ADECII Active+NOx

Control

1994 128 0 Excavator Extengine ADECII Active+NOx

Control 1997 54 0 Excavator Huss FS-MD Active

1994 168 0 Excavator Mann-Hummel GMBH CRT Passive

2003 66 1 Rough Terrain Forklift Mann-Hummel SMF-AR Active+FBC+

Electric

2003 247 2 Excavator Nett TechPassive SCR Passive+NOx

Control

1992 256 0 Rubber Tired Loader Nett TechPassive SCR Passive+NOx

Control

1994 200 0 Rubber Tired Loader Sud Chemie ENVICAT Passive
2006 418 3 Scraper, Rear CAT - DPF Passive64

Year HP Tier Vehicle Type Installed Device Type of

Device 2006 577 3 Scraper, Front CAT - DPF Passive

1996 285 1 Motor Grader CDT PermitFBC Passive+FBC

2006 418 3 Scraper, Rear CDT PermitFBC Passive+FBC

2006 577 3 Scraper, Front CDT PermitFBC Passive+FBC

2006 418 3 Scraper, Rear CDT Platinum Plus Purifilter Filter Passive+FBC

2006 577 3 Scraper, Front CDT Platinum Plus Purifilter Filter Passive+FBC

2007 405 3 Crawler Tractor DCL MINE-X Passive

1998 514 1 Excavator Recat-ESW DC-100 Active+FBC

2007 405 3 Crawler Tractor Sud Chemie ENVICAT Passive

2007 405 3 Crawler Tractor Sud Chemie ENVICAT Passive

2006 405 3 Crawler Tractor Sud Chemie ENVICAT Passive

1989 375 0 Rubber Tired Loader Rypos HDPF/C Active+Electric

1995 400 0 Rubber Tired Loader Sud Chemie ENVICAT Passive

1996 400 0 Rubber Tired Loader Sud Chemie ENVICAT Passive

1997 290 1 Excavator CAT-DPF Passive

1990 310 0 Rubber Tired Dozer CATEUG/DPF Passive+NOx

Control

2002 128 1 Excavator CDT PermitFBC Passive+FBC

1998 305 1 Crawler Tractor DCL Mine-X Passive

1997 168 1 Excavator ECS Assisted Purifilter Active+Electric

1995 365 0 Scraper ECS Assisted Purifilter Active+Electric
1997 358 1 Off-Highway Truck ECS Purifilter Passive

1997 305 1 Crawler Tractor Nett TechActive SCR Active+NOx

Control

1997 165 1 Grader Recat-ESW DC-100 Active+FBC

2004 185 2 Grader CAT - DPF Passive65

Year HP Tier Vehicle Type Installed Device Type of

Device 2005 185 2 Grader CAT - DPF Passive

2001 201 1 Rubber Tired Loader Donaldson DPF-SCR Passive+NOx

Control

1998 165 1 Grader ECS Assisted Purifilter Active+Electric

2001 102 1 Tractor/Loader/Backhoe ECS Assisted Purifilter Active+Electric
1999 106 1 Rough Terrain Forklift ECS Purifilter Pa ssive 2006 111 2 Tractor/Loader/Backhoe Huss FS-MD Active

1995 170 0 Rubber Tired Loader Mann-Hummel FBC Passive+FBC

2007 440 3 Scraper Donaldson Passive DPF Passive

2006 404 3 Excavator Dinex DiNox Passive+NOx Control

2006 120 2 Mobile Jumbo Screen Plant Dinex DiNox Passive+NOx Control

2007 385 3 Retek Startrack Mobile

Recycling Plant (Impact) Extengine ADECII Active+NOx

Control

2006 343 3 Rubber Tired Loader Extengine ADECII Active+NOx

Control

2007 440 3 Retek Startrack Mobile

Recycling Plant (Cone) Nett TechPassive SCR Passive+NOx

Control

1996 310 1 Crawler Tractor ECS Assisted Purifilter Active+Electric

1997 62 0 Tractor/Loader/Backhoe ECS Assisted Purifilter Active+Electric

1994 220 0 Rubber Tired Loader Extengine ADECII Active+NOx

Control

1999 175 1 Rubber Tired Loader Extengine ADECII Active+NOx

Control 1981 255 0 Rubber Tired Dozer Huss FS-MD Active 1997 215 1 Grader Huss FS-MD Active 1989 450 0 Rubber Tired Dozer Huss FS-MD Active 1994 175 0 Scraper Huss FS-MD Active 2003 73 1 Tractor/Loader/Backhoe Huss FS-MD Active

1982 255 0 Rubber Tired Dozer Mann-Hummel GMBH CRT Passive

1979 330 0 Scraper Mann-Hummel GMBH CRT Passive

2004 115 2 Crawler Tractor Nett TechActive SCR Active+NOx

Control

1995 335 0 Crawler Tractor Nett TechActive SCR Active+NOx

Control66

Year HP Tier Vehicle Type Installed Device Type of

Device

2002 110 1 Rubber Tired Loader Nett TechPassive SCR Passive+NOx

Control

2004 230 2 Rubber Tired Loader Nett TechPassive SCR Passive+NOx

Control

1980 310 0 Rubber Tired Dozer Recat-ESW DC-100 Active+FBC

1984 330 0 Scraper Recat-ESW DC-101 Active+FBC

2003 150 2 Crawler Tractor Sud Chemie ENVICAT Passive

1993 275 0 Rubber Tire Loader CATEUG/DPF Passive+NOx

Control

2004 247 2 Excavator Mann-Hummel FBC Passive+FBC

2002 116 1 Rough Terrain Forklift Nett TechActive SCR Active+NOx

Control 2005 371 2 Excavator CAT-DPF Passive 2006 469 3 Articulated Truck CAT-DPF Passive 2005 433 2 Excavator CAT-DPF Passive

1990 525 0 Crawler Tractor Extengine ADECII Active+NOx

Control

1984 315 0 Rubber Tired Dozer Extengine ADECII Active+NOx

Control
1988 550 0 Waterpull Extengine ADECII Active+NOx

Control 2006 187 3 Rubber Tire Loader CAT - DPF Passive 1985 45 0 Off-Highway Tractors Dinex-Dipex Passive

2004 75 2 Tractor/Loader/Backhoe Donaldson Passive DPF Passive
1985 45 0 Off-Highway Tractors ECS Purifilter Passi ve 1985 188 0 Scraper ECS Purifilter Passive 2006 73 2 Rubber Tire Loader ECS Purifilter Passive

2003 17 1 Tractor/Loader/Backhoe

s Huss FS-MD Active

2006 24 2 Tractor/Loader/Backhoe Huss FS-MD Active 1987 45 0 Off-Highway Tractors Huss FS-MD Active 2000 62 1 Rubber Tire Loader Huss FS-MD Active 2006 95 2 Tractor/Loader/Backhoe Huss FS-MD Active
1985 188 0 Scraper Mann-Hummel FBC Passive+FBC

1975 125 0 Off-Highway Tractors Mann-Hummel SMF-AR Active+FBC+

Electric
1987 153 0 Off-Highway Tractors Sud Chemie ENVICAT Passive67

Year HP Tier Vehicle Type Installed Device Type of

Device

1993 134 0 Rubber Tire Loader Sud Chemie ENVICAT Passive

1996 166 0 Rubber Tire Loader Sud Chemie ENVICAT Passive

1996 166 0 Rubber Tire Loader Sud Chemie ENVICAT Passive

Table 3: Private and Public Fleets in Showcase

Private Fleet Public Fleet Community Recycling & Resource Recovery Inc. CALTRANS Division of Equipment (Invited) Albert W. Davies, Inc. City of Burbank Public Works Department Recycled Materials Company of CA City of Los Angele s, General Services Department Dan Copp Crushing County Sanitation Districts of L. A. County ECCO Equipment Corp. City of Culver City Transporta tion Department Griffith Company PEED Equipment Company Altfillisch Contractors, Inc. Reed Thomas Company, Inc. Shimmick Construction Co. Skanska USA Civil West California District Inc. Tiger 4 Equipment Leasing Sukut Equipment Inc

Table 4: List of Manufacturers Participating in Sho wcase Participating Manufacturers Aaqius Huss Caterpillar Johnson Matthey CDT Mann-Hummel DCL Nett Tech Dinex Purem Donaldson Recat-ESW/ETI ECS Rypos Extengine Sud Chemie68

Figure 1: Example of Data Logging Results (Vehicle # W93518, City of Los Angeles)

Figure 2: Example of Data Logging Results (Vehicle # W93518, City of Los Angeles)69

Table 5: SEP I Retrofits Installed

Year HP Tier Vehicle Type Installed Device Passive/ Active/NOx Control
2000 315 1 Wheel Loader Extengine ADECII Active/ Nox

1999 230 1 Excavator Rypos HDP Active

550 2-Engine 2003 400 2 Scraper DCL Mine X Passive

1998 105 1 Wheel Loader Nett Tech Passive/ Nox

2007 125 3 John Deere ECS Assisted Active

2007 125 3 John Deere ECS Assisted Active

2000 185 1 Motorgrader Recat- ESW DC Active

2006 125 2 Tractor Sud Chemie Passive

2006 125 2 Tractor Recat ESW Active

2000 89 1 Wheel Loader Mann Hummel Active

1999 80 1 Wheel Loader Mann Hummel Active

1995 105 0 Wheel Loader Huss FS-MD Active

2007 125 3 John Deere Tractor Sud Chemie Passive

2007 125 3 John Deere Tractor Sud Chemie Passive70

Table 6: SEP II Retrofits

Year HP Tier Vehicle Type Installed or Proposed Device Passive/ Active/NOx Control

2000 86 1 Backhoe Mann Hummel SMF-AR Active

2007 150 3 Tractor Huss FS-MC Passive

2007 150 3 Tractor ECS Purifilter Passive

2005 224 2 Wheel Loader CAT – DPF Passive

2007 150 3 Tractor Tehag Passive

2002 180 0 Wheel Loader Econix DPF-A Active

2000 108 1 Wheel Loader CDT Platinum Plus Purifilter (Proposed) Passive

2004 95 2 Wheel Loader CAT – DPF Passive

2002 439 2 Excavator CAT – DPF (Proposed) Passive

2005 142 2 Fork Lift Truck Nett Tech Active DPF (Proposed) Active

1999 185 1 Side Handler 6 High Extengine MaxTrap

(Proposed) Active/Nox

Table 7: SEP III Retrofits Proposed to be Installed

Year HP Tier Vehicle Type Proposed Device Passive/

Active/NOx Control
2006 80 2 Broom CDT Passive
2004 119 2 Wheel Loader CDT Passive
1999 240 1 Excavator CAT Passive
2005 55 2 Tractor ECS Passive
2005 81 2 Mower ECS Passive
2004 82 2 Mower Mann Hummel Passive
2001 95 1 Backhoe Mann Hummel Active
2006 75 2 Tractor Loader HUSS Active
1998 75 1 Wheel Loader Nett Tech Active
1997 1 Motor Grader Nett Tech Active
1999 225 1 Motor Grader DCL Passive
2004 113 2 Mower HUSS Active71

Table 8: Fleets in Participating in SEP

SEP Fleet

LA County Sanitation District LA County Dept of Beaches and Harbors SEP I
City of Burbank Dept of Public Works

City of Long Beach City of Los Angeles SEP II Fast Lane (private company)

City of Benicia Alameda County Contra Costa County SEP III
Solano County

Table 9: Manufacturers Participating in SEP
Participating Manufacturers Caterpillar Mann-Hummel CDT Nett Tech DCL Recat ECS Rypos Econix Sud Chemie Extengine Tehag HUSS72

Table 10: Number of Vehicles in Showcase and SEP by Vehicle Type and Horsepower

Vehicle Type <175 HP 175<HP>500 >500 HP Bore/Drill Rigs 0 0 0 Cranes 0 0 0 Crawler Tractor 3 12 1 Excavator 6 19 1 Graders 2 7 0 Off-Highway Tractor 35 1 0 Off-Highway Truck 1 2 0 Other Mobile Off-road 5 1 1 Paver 2 0 0 Roller 0 0 0 Rough Terrain Forklift 7 0 0 Rubber Tired Dozer 0 6 1 Rubber Tired Loader 31 25 0 Scraper 0 16 8 Skid Steer Loader 0 0 0 Tractor/Loader/Backhoe 42 5 0 Trencher 0 0 073

APPENDIX D: OUTREACH SUMMARY

Table 1: ARB Training Sessions

Date Location # of people in attendance 7/31/2008 San Luis Obispo, CA 92 8/5/2008 Bakersfield, CA 77 8/7/2008 Redding, CA 77 8/11/2008 Nevada City, CA 65 8/14/2008 Fresno, CA 81 8/19/2008 Riverside, CA 142 8/20/2008 San Diego, CA 123 8/27/2008 El Monte, CA 142 8/29/2008 Sacramento, CA 190 9/3/2008 San Jose, CA 83 9/9/2008 Ventura, CA 75 9/12/2008 Oakland, CA 126 11/19/08 South Lake Tahoe, CA 27

Table 2: Presentations to Groups

Date Meeting/Group City # of people in attendance 10/16-17/2007 Clean Vehicle Expo Ontario, CA 50

11/1/2007 San Luis Obispo

County Builders Exchange San Luis Obisbo,

CA 50

11/7/2007 National

Association of Demolition Contractors Anaheim, CA 70

12/6/2007 CalCIMA

(represents Construction Aggregate and Industrial Mineral producers statewide) Sacramento, CA 50

12/13/2007 Municipal

Employees Maintenance Association (MEMA) Irvine, CA 20

2/21/2008 Presentation for

Quinn Company customers Santa Maria, CA 4074

Date Meeting/Group City # of people in attendance

5/22/2008 Solid Waste

Association of North America (SWANA) Seaside, CA 25

6/25/2008 The Air and Waste

Management Association (AWMA) Annual Conference and Exhibition Portland, OR 12

8/21/2008 Building Industry

Association of Central California Modesto, CA 20

8/27/2008 Maintenance

Superintendents Association Rohnert Park, CA 40

9/10/2008 TEC Equipment &

AGC (American General Contractors) Event Oakland, CA 40

10/3/2008 Tractoberfest Newark, CA 150

10/13/2008 South Coast AQMD

Clean Vehicle Expo Ontario, CA 13

10/14/2008 CMCA (Concrete

Modification Contractor's Assoc.) Livermore, CA 15

10/21/2008 Industrial

Environmental Association San Diego, CA 75

10/23/2008 DGS fleet asset

mgmt unit Sacramento, CA 25

11/10/2008 CA Golf Course

Superintendents Assoc Cabazon, CA 15075

Table 3: Meetings with Individual Fleets or Stakeho lders

Date Meeting/Group City

11/27/2007 ARB Implementation

Seminar/training for Sequoia equipment company (CASE dealer) Fresno, CA

12/10/2007 Municipal Fleet of Yolo

County Woodland, CA
12/13/2007 Cattrac Fontana, CA 1/4/2007 Iron Man Corona, CA

1/7/2007 CASE Tractor Equipment

Sales Hayward, CA
3/26-28/2008 Quinn company City of Industry, CA

3/27/2008 Stevens Creek Quarry,

Inc. Sacramento, CA

4/7/2008 Monterey Regional

Waste Management District Sacramento, CA

4/9/2008 CASE Tractor Equipment

Sales Hayward, CA
4/10/2008 Mountain Cascade Inc Livermore, CA 4/16/2008 Tutor Saliba Corp. Sacramento, CA 4/21/2008 C & C Construction Sacramento, CA

5/6/2008 Pape Machinery (John

Deere) Sacramento, CA
5/14/2008 Neff Rentals Sacramento, CA 5/21/2008 Nissan Sacramento, CA

5/28/2008 Pape Materials Handling

Group Sacramento, CA

5/29/2008 Western Power and

Equipment Sacramento, CA
6/12/2008 CAT dealership San Diego, CA

6/17/2008 Johnson-Lift/HYSTER

dealership City of Industry, CA

6/20/2008 NAACO Materials

Handling Group (Yale division) Sacramento, CA

6/20/2008 NAACO Materials

Handling Group (HYSTER division Sacramento, CA

7/8/2008 Sugar Bowl Sacramento, CA

7/22/2008 Diamond D Engineering

and Associates Sacramento, CA

8/28/2008 Tahoe Truckee Sierra

Disposal Sacramento, CA
9/10/2008 Rush Enterprises Fontana, CA76 Date Meeting/Group City 10/10/2008 Western Stabilization Sacramento, CA 10/27/2008 Appian Engineering Milpitas, CA

11/5/2008 PAR Electrical

Contractors Sacramento, CA

Table 4: Attendance at Conferences and Workshops

Date Meeting/Group Location 10/16-17/2007 Clean Vehicle Expo Ontario, CA

9/17/2008 Public Works Event -

AGC Emeryville, CA

9/25-26/2008 League of California

Cities 2008 Annual Conference & Expo Long Beach, CA

10/3/2008 Tractoberfest Newark, CA

10/13/2008 South Coast AQMD

Clean Vehicle Expo Ontario CA

10/21-22/2008 Industrial Environmental

Association San Diego, CA

10/23/2008 DGS fleet asset mgmt

unit Sacramento, CA

10/29/2008 AGC Southern California

Construction Technology Event San Diego, CA

11/13-11/14/2008 Far West Equipment Dealers Association Annual Conference Phoenix, AZ77

APPENDIX E: DOORS ON-LINE USER-GUIDES

The Diesel Off-road On-line Reporting System (DOORS ) is available for fleets which choose to report early. Staff have been assisting fleet representatives personally, and have also created a number of user guides and expla nations of the reporting information required by the regulation. These guid es are available from the reporting homepage ( https://secure.arb.ca.gov/ssldoors/doors_reporting/ reporting.php ) and are listed below in Table 1.

Table 1: DOORS User Guides

General DOORS Guides Reporting Using Online Screens Reporting Using Excel Spreadsheets How to Report with Missing Information How to Report Duplicate Serial Numbers Reporting Multiple Fleets or Subfleets Importing Data to Excel Spreadsheets Definitions and Explanations Owner Information Vehicle Information Engine Information VDECS Information

The “Reporting Using Online Screens” guide is prese nted on the following pages as an example of the method and format used in the DOORS guides.78 

### Online Forms for Initial Reporting

Introduction
The Diesel Off-Road On-Line Reporting System (DOORS ) is an online tool designed to help fleet owners report their off-road diesel vehicle inventories and actions taken to reduce vehicle emissions to the Ai r Resources Board (ARB), as required by the In-Use Off-Road Diesel Regulation.

Both the DOORS reporting tool and the DOORS User ma nual were created to help fleet owners comply with the regulation, but they a re not a substitute for reading and comprehending the regulation. Many portions of the DOORS system will require fleet owners to understand terms and condit ions defined in regulation, and to know which portions of the regulations apply to their vehicles, and where they are eligible for full or partial exemptions. It is strongly recommended that, prior to using the DOORS system, fleet owners determine how the regulation applies to their fleets.

The regulation, fact sheets, additional user guides , and compliance examples can be found at: http://www.arb.ca.gov/msprog/ordiesel/ordiesel.htm



### User Guide – Online Forms for Initial Reporting
This guide was created to assist fleet owners using Online Screens to report fleet information during the initial reporting period. T he guide contains instructions on how to create an online account with ARB in DOORS, navigate to the online screens, enter the data, receive a review from ARB and receive Equipment Identification Numbers (EINs).

Steps to Report Fleet Data Using Online Forms This guide provides detailed instructions on how to complete the following steps to report you fleet using our online forms:

A. Create a DOORS account with ARB B. Determine applicable vehicles C. Log in to DOORS, and open the online forms D. Complete the owner information form E. Enter the vehicle information F. Enter the engine information, and if necessary, the VDECS information G. Review the data, and make changes if necessary H. Request a review from ARB and receive EINs 

## Initial Reporting
( Revised September 5, 2008 ) 

## DOORS User Guide79

A. Create a DOORS Account with ARB



### • Go to https://secure.arb.ca.gov/ssldoors/doors_reporting/ reporting.php



### • Request an account

If you do not have an account, you will be asked to create one, and the account information will be sent to an email addres s you supply within a few minutes. If you do not see the email, check your “ Spam” or “Trash” folders to ensure the email was not blocked by your email serv er. If you do not receive your email within 15 minutes, re-apply for one on t he DOORS homepage. If this does not work, contact ARB for assistance by e mailing doors@arb.ca.gov

. B. Determine applicable vehicles

Prior to reporting vehicle information to ARB, flee t owners will need to determine which of their off-road diesel vehicles a re covered by the regulation. Some vehicles will likely be fully sub ject to the regulation, however some vehicles will be exempt from all requi rements except labeling and reporting, and some will be fully exem pt from the regulation.



### • Create a complete list of vehicles subject to the r egulation, including those which are only required to be reported and labeled
Early Credit: If you wish to claim early credit, report each ve hicle that was included in the fleet from March 1, 2006, to th e present, including vehicles you have retired or sold. You will be abl e to designate which vehicles you have retired or replaced to receive cr edit in the on-line screens after future updates.

Non-diesel or electric : You will be able to report vehicles using alternative fuels or electric vehicles that have re placed diesel vehicles in your fleet in the on-line screens after updates, for now please include information on the diesel vehicle that was replaced.

C. Log in to DOORS, open the online forms



### • Return to the DOORS login screen, and log in to the system using the login name and password emailed to you

Do not hit “Enter”; you must click on the Login but ton directly. If DOORS does not accept your password, copy the passw ord from the email, and paste it into the DOORS login screen. 

## DOORS User Guide Initial Reporting
( Revised September 5, 2008 )80



## DOORS User Guide

• Once you have logged in to DOORS, go the first drop down, and select

“ enter a fleet ”. In the second dropdown, select “ Enter Fleet Data On-Line ” and then click on the [Take Action] button to the right.

D. Complete the owner Information form



### • The first screen you will be taken to is the Owner Information screen. Complete this form, and then s elect [Enter Data ].
If you have questions about what information is req uested, please refer to our explanation for each spreadsheet, available on the reporting page https://secure.arb.ca.gov/ssldoors/doors_reporting/ reporting.php under the User Guide menus. For the Owner information, select “Ow ner Information Dictionary”.



### • If DOORS rejects any of your information, it will s upply an error message and reason at the top of the screen. Attempt to fix th e cause of the error, and resubmit the data.

E. Enter vehicle information



### • Once your owner information has been successfully e ntered, select the option
to [Add / Edit Vehicle] at the top or the bottom of the screen.



### • This will take you to the screen where you may add, delete or edit vehicle information. 

## Initial Reporting
( Revised September 5, 2008 )81



## DOORS User Guide

• Enter the vehicle information required, then select [Enter Data]

If you have questions about what information is req uested, please refer to our explanation for each spreadsheet, available on the reporting page

https://secure.arb.ca.gov/ssldoors/doors_reporting/ reporting.php under the Explanation of Terms.

For missing or partial information, refer to the at tachment on the last page of the guide.



### • After the information on the previous vehicle is en tered into a table, continue to use the form to add additional vehicles until your entire inventory is reported. For each successive vehicle, enter the vehicle info rmation required, then select [Enter Data]

F. Enter engine information, and if necessary, VDEC S information



### • After entering information on all of the vehicles y ou wish to report, select the option to [Add / Edit Engine] at the top or the bottom of the screen.



### • For each vehicle you have entered, select “Edit” at the left side of the screen, and input the engine information. Then select [Enter Data]. You will only be able to add engine information to vehicles you have already added, and you will only be able to add VDECS information if you h ave already entered the engine information.



### • Complete the same steps to enter VDECS information, if you have any VDECS installed on your vehicles.

G. Review the data, and make changes if necessary

Before continuing, it is recommended that you revie w the data you have entered. On the Reporting Home page (the first pag e in DOORS), the following options are available for fleets you have entered into the system: 

## DOORS User Guide Initial Reporting
( Revised September 5, 2008 )82



### • Select the fleet you have entered and wish to revie w



### • Select “View Owner” and click on “Take Action”. DO ORS will display the fleet owner information you have uploaded. Ensure the da ta shown is correct, and then return to the Reporting Home page.



### • If it is not correct, return to the reporting homepage, select the fleet , and the choose “Enter Fleet Data On-line”. You will be able to edit, delete, and add owner, vehicle, engine, and vdecs informati on.



### • Select “View Fleet” and click on “Take Action”. DO ORS will display the vehicle, engine, and VDECS information you have uploaded. E nsure the data shown is correct, and then return to the Reporting Home page

.



### • If it is not correct, return to the reporting homepage, select the fleet , and the choose “Enter Fleet Data On-line”.

H. Request a review from ARB and receive EINs

The information you have entered so far will be sav ed, and you can access it again and make changes at a later time be fore submitting it to ARB for review. After ARB reviews the information you will be able to edit and add to your vehicle inventory, and will receive your ARB-designated Equipment Identification Numbers, which must be dis played on your vehicles. The information will not be reviewed by ARB staff, or assigned EINs, until you choose to submit it to ARB for revi ew. To access the fleet information you have entered at a later date, log b ack in to the DOORS system.

Where you previously selected “Enter a fleet”, the fleet (or fleets) you have entered will now be available. To edit a fleet, select it, and then choose “Upload Fleet Data” and the press the “Take Action” button. You may resubmit the appropriate .prn files and view your updated information. 

## DOORS User Guide Initial Reporting
( Revised September 5, 2008 )83 Once you are satisfied with the information and are prepared to send it to ARB for review and receive EIN assignments for your vehicles, return to the Reporting Home page in the DOORS system.



### • Select the Fleet you wish to submit to ARB in the drop down menu



### • Select “Request Review” from the drop down menu below, and click on “Take Action”

After the fleet information has been approved by A RB, the fleet will be available for further review and modification, usin g the following menu on the bottom of the Reporting Home page of the DOORS system after you log in. Not all features will be available when D OORS first comes online in July, 2008.

For more information on reporting with missing or p artial information, or how to report multiple fleets or subfleets, refer t o our guides, which are available from our reporting homepage at: https://secure.arb.ca.gov/ssldoors/doors_reporting/ reporting.php

If you require additional assistance or information , please email us at:

doors@arb.ca.gov 

## Initial Reporting
(( Revised September 5, 2008 ) 

## DOORS User Guide8485

APPENDIX F: LIST OF ACRONYMS

ARB --- Air Resources Board BACT --- Best Available Control Technology BOE --- California Board of Equalization

CAA --- Clean Air Act Cal/OSHA --- California Occupational Safety and Hea lth Administration CCR --- California Code of Regulations

CSLB --- Contractors State License Board DECS --- Diesel Emission Control Strategies DOCs --- Diesel Oxidation Catalysts DOF --- Department of Finance DOORS --- Diesel Off-Road On-Line Reporting System DMV --- Department of Motor Vehicles

DPF --- Diesel Particulate Filter EIN --- Equipment Identification Number

EGR --- Exhaust Gas Recirculation G/BHP-HR --- Grams per Brake-Horsepower Hour
HP --- Horsepower MSHA --- Mining Safety and Health Administration

MSRC --- Mobile Source Air Pollution Reduction Revi ew Committee

NO X --- Oxides of Nitrogen ORIAG --- Off-Road Implementation Advisory Group

PM --- Particulate Matter SCAQMD --- South Coast Air Quality Management Distr ict SEP --- Supplemental Environmental Project SJVAPCD --- San Joaquin Valley Air Pollution Contro l District SOON --- Surplus Off-Road Opt-In for NOx TSD --- Technical Support Document

U.S. EPA --- United States Environmental Protection Agency VDECS --- Verified Diesel Emission Control System