DERG@epa.state.oh epa.ohio/oee/derg.aspx Updated 11/14/11 Carolyn Watkins,

1. DERG@epa.state.oh.us http://epa.ohio.gov/oee/derg.aspx Updated 11/14/11 Carolyn Watkins, Office of Environmental Education Carolina Prado, Division of Air Pollution Control

2. Why clean diesel? • Reduce our exposure to the harmful pollutants in diesel exhaust. • Reduce the amount of air pollution created by diesel engines. • Improve air quality in Ohio counties that do not currently meet national Clean Air standards

3. Diesel Exhaust and Health • Diesel exhaust contains small soot particles known as fine particulate matter • Fine particles can lodge in the lungs and aggravate conditions such as asthma and bronchitis • US EPA has determined that diesel exhaust is a likely human carcinogen

5. The 6 R’s of Diesel Cleanup • REDUCE fuel use and engine idling • REFUEL with cleaner fuels like propane and CNG • RETROFIT existing vehicles with pollution controls • REBUILD older diesel engines to reduce emissions • REPOWER older diesel engines, to remove or replace with a newer, cleaner engine • REPLACE older diesel vehicles and non-road equipment with newer, cleaner vehicles and equipment that meet more stringent emission standards

6. DERG Grant Program • Moved from the Ohio Department of Development to Ohio EPA July 1, 2011. • ODOD and ODOT will continue to administer grants already awarded in the first two rounds • Federal highway congestion mitigation and air quality (CMAQ) funds, $20 million over two years • Grants will REIMBURSE up to 80% of eligible project costs • Ohio EPA will also apply for additional US EPA funds when available

7. Applications may be submitted from fleets in Ohio nonattainment counties: those not meeting federal air quality standards for fine particulates (PM 2.5) or ozone (green counties on map), or those in maintenance status as determined by US EPA Eligible Fleets

8. DERG Eligible Fleets • All transportation sectors allowed in CMAQ, including highway construction • Public sector diesel fleets (e.g., school buses, transit buses, other government fleets with some restrictions) • Private sector (including non-profit) diesel fleets, e.g., short haul trucks, locomotives, highway construction equipment (working on a surface transportation construction project within an Ohio non-attainment area) that apply through a public sector partner such as a metropolitan planning organization • Emission reduction calculation (PM 2.5 and NOx) must accompany application.

9. DERG Eligible Expenses • All types of projects, subject to CMAQ restrictions: • Rebuilding a diesel engine, with resulting emission reductions • Full cost of replacement of traditional public transit vehicles, or partial cost of replacement of other diesel-powered vehicles & equipment. • Purchase and installation of verified retrofit technologies with resulting emission reductions • Upgrades to long-haul trucks for idle reduction, aerodynamic fixtures, and efficient tire technologies • Repowers (destruction of old engine must be certified) • Labor costs if performed by an outside contractor/vendor to install approved DERG Program replacement engines or retrofit applications.

10. DERG Eligible Projects • CMAQ-invested projects or programs must reduce CO, ozone precursor (NOx and VOCs), PM2.5, or PM2.5 precursor (e.g., NOx) emissions from transportation. • All projects shall be advertised and awarded through competitive bid standards • Equipment must be operated in a nonattainment or maintenance area for a minimum 65% of the time • Public-Private Partnerships (PPPs) must be documented and executed • FHWA must issue formal eligibility determination

11. Vehicle/Machinery Replacement • New vehicles/machinery must meet higher emission standards. • Verification that old vehicles/machinery have not been returned to service • 80% of total project cost subject to CMAQ restrictions, less core or scrap value and other governmental financial purchase contributions • For private and non-profit fleets, funding will be approved only for replacement vehicle components that contribute to the vehicles’ emission characteristics

12. Repower (Engine Replacement) • Removing the engine from a piece of equipment and replacing it with a new, rebuilt or remanufactured engine (including CNG or propane repowers) that meets higher emission standards • Verified equipment, verification that old engine is remanufactured or destroyed • Reimburse 80% of equipment invoiced cost, less core value or scrap value • Reimburse 80% of installation invoiced cost performed by authorized outside vendor

13. Retrofits • Adding on emission reduction technologies to reduce pollution • Retrofit technology must be verified by US EPA or CARB, specific to engine type and model year • Reimburse 80% of invoiced purchase cost including delivery charges • Reimburse 80% of invoiced installation cost if performed by an authorized outside vendor • Reengineering costs by an authorized outside vendor, if vehicle/equipment must be modified for retrofit (less any scrap or resale value)

14. Idle Reduction • Adding anti-idle technologies to reduce pollution • Equipment must be verified by USEPA • Reimburse 80% of invoiced purchase cost of anti-idle equipment including delivery • Reimburse 80% of installation costs if installed by an authorized outside vendor • Reimburse 80% of reengineering costs by an authorized outside vendor if the vehicle or equipment must be modified for the anti-idle technology

15. Technology Options • U.S. EPA Verified Technologies http://epa.gov/cleandiesel/verification/verif-list.htm • California Air Resources Board (CARB) Verified Technologies www.arb.ca.gov/diesel/verdev/verdev.htm

16. Ineligible Expenses • Operating expenses and fuel costs, including incremental costs of fuel. The use of cleaner fuels such as ULSD and biodiesel blends is encouraged, but is not reimbursable. • Any project required by any law or other agreement • Work done on purchases made prior to official notice of project funding approval, or for costs incurred for work or purchases not included in the approved project costs. • Installation costs incurred from in-kind services or by an unauthorized vendor • Administrative costs.

17. DERG Grant Administration • Ohio EPA issues request for proposals (November 2011) with application deadline in January 2012 • Ohio EPA and ODOT choose best mix of projects that meet Federal Highway requirements • ODOT administers grants to public sector fleets • Ohio EPA administers grants to private sector fleets • Like all federal grant programs, project costs are reimbursed • 20% non-federal match required on all projects • Calculation of emission reductions required with each application

18. Factors Considered in Awarding Grants • Anticipated level of PM 2.5 and/or nitrogen oxide emission reductions • Cost effectiveness of the emission reductions • Strength of match provided by the applicant (20% minimum) • Percent of emission reductions that will occur in nonattainment or maintenance areas (65% minimum) • Geographic balance of grants awarded across eligible counties within Ohio • Minimum grant award: $20,000. Projects under $100,000 are encouraged to submit in combination

19. Timeline (approximate) • October 2011: Website and application under development (http://epa.ohio.gov/oee/derg.aspx), Ohio EPA seeking comments and suggestions • October - November 2011: information sessions in several cities, Request for Proposals (RFP) released • January 2012: proposals due • March 2012: DERG grant awards announced • April 2012: projects under contract • September 2012: Next round of applications due

20. Another funding source : Ohio Clean Diesel School Bus Fund www.epa.ohio.gov/oeef/schoolbus.aspx • Retrofits and Idle Reduction Equipment (no repowers or replacements) • Grants up to $300,000 • Maximum $600,000 available to award each year from state civil penalties • Applications due March 1 and September 1, 2012 and March 1, 2013

21. School Buses Cleaned Up So Far Since the program began in 2006, Ohio’s Clean Diesel School Bus Fund provided $7 million to retrofit 2,337 school buses with pollution controls, installed idle reduction equipment onto another 544 buses, and removed more than 145 tons of pollutantsfrom the air.

22. Questions? DERG@epa.ohio.gov Funding questions: Carolyn Watkins Office of Environmental Education (614) 644-3768 carolyn.watkins@epa.state.oh.us Technology questions: Carolina Prado Division of Air Pollution Control (614) 644-2310 carolina.prado@epa.state.oh.us