National Clean Diesel Campaign Assistance for State Programs Peter Murchie

1. National Clean Diesel Campaign Assistance for State Programs Peter Murchie WRAP Mobile Sources Forum Workshop on Developing and Implementing State Funded Retrofit Program June 7, 2007

2. Overview • National Clean Diesel Campaign (NCDC) • NCDC Tools and Technical Assistance for: • Illustrating the need for clean diesel programs • Designing a clean diesel program • Implementing a program • Evaluating performance • Funding Opportunities 2

3. National Clean Diesel Campaign- 2 Components • Regulations • Heavy-Duty Highway New Engines • Nonroad New Engines • Locomotive and Marine Engines • Innovative Program to address existing diesel fleet • Construction • Ports • Agriculture • School Bus • Freight 3

4. A Comprehensive and Collaborative Approach to Diesel Emissions Reduction Common Aspects-- • Systems approach– ULSD enables clean technologies. • Very large environmental and public health benefits. • Current regulations: by 2030, PM reduced by ~250,000 tons/year, NOx by ~4 million tons/year. Annual benefits are expected to exceed $175 billion versus costs of approximately $11 billion. • Responsive to needs of states to meet NAAQS. • Collaborative process. Tier 2 Light-duty (1999) Highway 2007/2010 Heavy-duty (2001) Clean Nonroad Diesel (2004) Locomotive/Marine Nonroad 4

5. National Clean Diesel Campaign Goal: Reduce emissions from the legacy fleet of over 11 million diesel engines by 2014 NCDC Program activities: • Technology verification • Providing technical and policy analysis • Coalition-building and outreach • Establishing projects through grant competitions EPA’s Clean Diesel Collaboratives • 7 clean diesel collaboratives across the nation • diverse coalition of businesses, government, environmental groups and community organizations, industry, and others • identify innovative, incentive-based projects • grant EPA clean diesel funds 5

7. Clean Diesel Progress • Current clean diesel programs will reduce more than 20,000 PM tons over their lifetime. These reductions will provide nearly $5 billion in health benefits. • More than two million children ride to school in cleaner buses, and approximately 30,000 school buses are cleaner • School bus retrofits will lead to 20,000 fewer respiratory symptoms and 14,000 fewer asthma exacerbations in children • More than 500 shipping and trucking companies representing more than 300,000 diesel trucks have joined the SmartWay Transport Partnership • More than 9,000 machines were retrofitted and more than $300 million was committed to make construction engines cleaner 7

8. The Case for Clean Diesel Protecting Public Health • Diesel exhaust is likely to be carcinogenic to humans • Diesel emissions cause: • thousands of premature deaths, • hundreds of thousands of asthma attacks, • millions of lost work days and • numerous other health impacts every year. 8

9. The Case for Clean Diesel Clean diesel is cost-effective: • Diesel retrofits can provide a health benefit-to-cost ratio of up to 13:1 • Diesel retrofits can result in PM reductions as low as $11,100/ton • Retrofit NOx reductions can be as low as $2,000/ton • Fuel savings technologies can result in net financial gains NCDC Resources: • Three reports on cost effectiveness available • Diesel Emissions Quantifier (DEQ)- an online emissions calculation tool for specific projects 9

10. The Case for Clean Diesel Meeting Air Quality Plans • Emission reductions from diesel retrofits can help states meet 8-hour ozone and PM2.5 air quality standards • Clean diesel strategies offer cost-effective, immediate reductions • EPA has developed three SIP and conformity guidance documents for control measures that reduce diesel emissions • Diesel retrofits • Long-Duration truck idling • Locomotive idling 10

11. The Case for Clean Diesel • Broad Stakeholder Support • Industry, government, community and environmental groups agree - cleaning up diesel emissions is important • Shared responsibility for clean air and public health • Clean diesel collaboratives foster partnerships and support • Implementation Advantages • Diesel retrofits can be implemented quickly • Several projects and programs to learn from • Resources and leveraged funds available 11

12. NCDC Tools for Designing a Program Identifying and Targeting fleets • EPA emissions inventory and models: (http://www.epa.gov/otaq/models.htm) • Info on technology options and tools for specific sectors on our website Supporting proven technologies • EPA’s Technology Verification Program • CARB’s Technology Verification Program 12

13. NCDC Tools for Designing a Program Resources for designing incentives • Reports: • "Recommendations for Reducing Emissions from the Legacy Diesel Fleet" and • “Emission Reduction Incentives for Off-Road Diesel Equipment Used in the Port and Construction Sectors” • Construction Air Quality Language Clearinghouse • Case studies and model programs 13

14. Tools for Implementing a Program Regional Clean Diesel Collaboratives • Provide technical assistance • Help promote a program • Foster partnerships • Identify additional resources for leveraging • Provide recognition for successful programs 14

15. Tools for Implementing a Program EPA and CARB’s Verified Technology List • Provides list of proven technologies • Identifies engine operating criteria and conditions necessary for technologies to achieve expected results • Depicts the estimated emissions reduction of a technology • Vendor contact information Diesel Emissions Quantifier (DEQ)- User friendly tool for estimating emissions reductions and cost effectiveness • Allows fleet managers and others to evaluate different technologies for their fleet • Allows potential grant applicants to provide emissions reductions and cost effectiveness information in applications 15

16. Results Screen • Divided into 2 Sections • Annual/Daily • Lifetime 8

17. Evaluating Program Performance • Verification levels for EPA and CARB verified technologies • For SIP and conformity emissions credit, EPA recommends using the National Mobile Inventory Model (NMIM) • EPA will review alternative approaches on a case-by-case basis • For more information, consult EPA’s SIP and Conformity Guidance for diesel retrofits 17

18. Federal Funding Opportunities National Clean Diesel Campaign • FY 2003-2007 • $32 million for Clean School Bus USA • $6.1 million for other clean diesel activity • FY 2008 budget • President request: $35M • House subcommittee: $50M • Final funding amount to be • determined 18

19. Diesel Emissions Reduction Program Energy Policy Act of 2005: • Authorizes more than $1B over 5 years for grants and loans that support clean diesel activities Program divided into Federal and State components • 70% for federal grant/loan programs • 30% for State programs • All fleets eligible for assistance from both Federal and State components • Program funding, allocations, criteria, eligibility, etc. will be subject to final Congressional appropriation language 19

20. Diesel Emissions Reduction ProgramFederal Component • 70% to the Federal Component • Eligible entities • Regional, state, local, tribal or port agency with jurisdiction over transportation or air quality; • Nonprofit entities (air, diesel, transportation related) • Use of funds • >= 90% for verified/certified technologies • <=10% for emerging technologies • 50% to benefit public fleets • Retrofit Technology, Engine Replacement, Engine Repower, Engine Rebuild, & Reduction of long-duration idling • The criteria for prioritizing projects is in EPAct. 20

21. Diesel Emissions Reduction ProgramPriority Projects • Section 792(c)(3) states that priority goes to projects that: • Maximize public health benefits • Are the most cost-effective • Are in areas with high population, air quality issues, and air toxic concerns • Are in areas that receive a disproportionate quantity of air pollution (i.e. truck stops, ports) • Maximize the useful life of the engine • Conserve diesel fuel and utilize ULSD (nonroad projects) 21

22. Diesel Emissions Reduction ProgramState Component • 30% to the States • 20% to States with EPA approved application • If all 50 States qualify, 2% for each • If less than 50 States qualify, 2% plus population formula • 10% for State matching incentives • If a State matches their allocation, they can receive an additional 50% of their allocation • Unclaimed funds go to the federal program 22

23. Innovative Financial Strategies are Necessary! • Grant programs and other government funding programs will not achieve our clean air goals. • We need creative, sustainable funding and financing strategies for emission control technologies for all sectors: Trucks, school buses, locomotives, freight, construction, agriculture, ports, etc. 23 11

24. Innovative Financing Smartway Truck Loans: • EPA and SBA National Environmental Loan Program is now available • Will finance fuel saving strategies (APUs, aerodynamics, tires) Smartway PLUS Loans: Low interest, more flexible loans • More environmental controls = Better financing rates and/or terms • Trucks with after-treatment are less expensive that those without • Community Investment Banks, Public/Private investment blends Information available at: http://www.epa.gov/otaq/smartway/index.htm 24

25. For More Information Visit EPA’s National Clean Diesel Campaign Website www.epa.gov/cleandiesel