CARB Conundrum: Just When You Thought it was Safe To Go Outside

Upgrades are coming...Upgrades are coming!!!!

The diesel user industry in California is no stranger to regulatory efforts directed at emissions reductions. Serious air quality challenges have plagued regions of California for decades and mobile emissions sources have been the largest part of the emissions pie for many years. Because of this, California has led the charge on implementing regulations to control mobile source emissions from gasoline powered cars and trucks as well as more recent efforts aimed at controlling diesel emissions from the heavy duty engines that power the transportation sector.

Throughout the years, these recent efforts and legacy programs have helped local air districts in highly populated, geographically challenged regions achieve drastic improvements in Air Quality with limited end-user resistance and little political opposition.

These efforts have propelled CARB into the spotlight as the “preeminent” air quality regulatory agency in the world. More recent than the catalytic converter and CARB diesel, California has passed several multi-billion dollar rules aimed directly at diesel users in California. Waste collection vehicles, municipal fleets, drayage trucks and refer engines have already fallen before the regulatory guillotine with emissions cuts from these vehicles reaching up to 90%.

 The two flagship diesel regulations are aimed at heavy duty, off-road equipment and heavy duty, on-road equipment; over one million of these pieces of heavy metal operating in California are under regulatory scrutiny. The off-road regulation hasn’t gotten final clearance from the EPA yet, but the on-road regulation has been passed, implemented and is now being enforced.  The trucks that bring everything from toothpaste to tube-socks in California all must fall within specific guidelines. In fact, all diesel-powered trucks over 14,000 pds. GVWR are currently under regulation to replace with 2010 emissions technology in the next 10 years. In the interim, and as of January 2012, any truck operator who has a 1996 – 2004 engine in any truck in their fleet must have a Level 3 Particulate Matter control device, unless they have registered for one of the many exemptions to the current requirements. 

 Most folks who have been around these regulations will know these facts like the back of their hand. CARB has been workshopping and training end users since 2006, and despite strong opposition from certain sectors of the fleet, the regulation is moving ahead swiftly and in fact, it is picking up speed.

 In its second year, the On-Road Truck and Bus Rule, the first of its kind in the nation and in its entirety, the most complex, restrictive emissions program for heavy duty trucking in the world, will force thousands of truck owners to upgrade their trucks or face stiff penalties that may total up to $10,000 per day. The exemptions, although some more complicated than others, offer a way for fleets to comply without meeting the direct schedule.

There are considerations for smaller fleets with 3 or fewer trucks over 14,000 GVWR, as well as a phase in schedule for larger fleets, mileage and model year restrictions for vocational fleets and a separate schedule for trucks operating exclusively in specific counties, all require reporting and all expire within the next few years.

On January 1, 2014, a major exemption for small fleets (3 or less trucks) runs out. This means that the over 100,000 single, two and three truck operators registered in California and coming into California from all over the country are facing an upgrade requirement at the end of 2013. What this also means is that anyone who dispatches one of these heavy duty diesel vehicles in California or into California after 2014 will be subject to penalties if a non-compliant vehicle is found; no mater whose authority they are operating under.

 Although only California based brokers are subject to direct penalties under this regulation, any motor carrier based anywhere will be caught up in the regulatory web and fined, potentially for each dispatch going back to the beginning of 2012. CARB has already levied heavy fines against drayage operators who dispatched non-compliant vehicles to covered Intermodal facilities over the past 3 years and just levied a $300,000 fine against a fleet for engaging in dray-off near the Mexican border. Proof in point that no one can escape the regulatory gauntlet; if you are operating in California, you must meet the standards. 

 To hammer home their authority where they need it, CARB has a couple of different measures at their disposal. One that allows them to deny registration at time of renewal through California DMV if a fleet has not paid their CARB related fines and another, in conjunction with CHP that allows them to impound vehicles that have cancelled registration because of outstanding violations. CARB can even levy an unfair business practices lawsuit against violators if the infraction is serious enough. When they find you, they will fine you, and as many California diesel operators can attest, CARB settlements instruct you on how much you will need to pay in order to clear the citation; it is not really a negotiation, they settle on an amount and you pay it. The fine amount is of course in addition to the additional capital required to upgrade the equipment to meet the standards; a double edged pendulum for anyone who gets caught operating or dispatching non-compliant equipment.

 With renewed debate surrounding model year registration bans that are surfacing from the legislative scrap heap, the industry will continue to be faced with increasing compliance costs as standards and restrictions keep rolling in. Active engagement in the requirements is necessary to minimize the risk that all transportation businesses face when turning miles in the Golden State. Although the skies in California are getting clearer, the industry can expect more hazy insinuations from regulators regarding zero-emission freight corridors and sustainability plans that seek additional reductions from the on-road diesel sector. The efforts around emissions reductions are far from over, the sky’s the limit, no matter how clean (or dirty) it gets.

Matt Schrap is President of California Fleet Solutions (CFS) and VP of Government Programs for Crossroads Equipment Lease and Finance. CFS and Crossroads are the trusted source for CARB regulatory information for fleets operating in and out of California.

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