BOARD MEETING STATE OF CALIFORNIA AIR RESOURCES BOARD JOE SERNA JR., CAL/EPA HEADQUARTERS BUILDING 1001 I STREET BYRON SHER AUDITORIUM SACRAMENTO, CALIFORNIA THURSDAY, JANUARY 24, 2008 9:00 A.M. JAMES F. PETERS, CSR, RPR CERTIFIED SHORTHAND REPORTER LICENSE NUMBER 10063 PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 2 APPEARANCES BOARD MEMBERS Ms. Mary D. Nichols, Chairperson Ms. Sandra Berg Supervisor Judith G. Case Ms. Dorene D'Adamo Supervisor Jerry Hill Ms. Lydia H. Kennard Supervisor Ron Roberts Dr. Daniel Sperling STAFF Mr. James Goldstene, Executive Officer Mr. Tom Cackette, Chief Deputy Executive Officer Mr. Mike Scheible, Deputy Executive Officer Ms. Lynn Terry, Deputy Executive Officer Mr. Robert Jenne, Acting Chief Counsel Ms. Kathleen Quetin, Ombudsman Ms. Sharon Anderson, Program Management & Integration Section Ms. Analisa Bevan, Manager, ZEV Implementation Ms. Edie Chang, Chief, Program Planning & Management Branch Ms. Heather Choi, Air Pollution Specialist Mr. Richard Corey, Assistant Chief, Research Division PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 3 APPEARANCES CONTINUED STAFF Dr. Bart Croes, Chief, Research Division Mr. Bob Cross, Chief, Mobile Source Control Division Ms. Shawn Daley, Manager, Retrofit Assessment Section Mr. Michael Fitzgibbon, Chief, Air Quality Field Studies and Administration Branch Ms. Cynthia Garcia, Population Studies Section Mr. Paul Hendrick, Air Resources Engineer, Retrofit Assessment Section Mr. Jorn Herner, Manager, Greenhouse Gas Technology & Field Testing Section Ms. Debbie Kerns, Staff Counsel Ms. Annmarie Mora, Manager, Research Planning and Climate Change Outreach Section Mr. Kirk Oliver, Senior Staff Counsel Mr. Johnnie Raymond, Program Management & Integration Section Ms. Danielle Robinson, Air Resources Engineer, Retrofit Assessment Section Mr. Chuck Shulock, Assistant Executive Officer, Office of Climate Change Dr. Linda Smith, Chief, Health and Exposure Assessment Branch Dr. Barbara Weller, Manager, Population Studies Section Mr. Erik White, Chief, Heavy-Duty Diesel In-Use Strategies Branch PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 4 APPEARANCES CONTINUED ALSO PRESENT Dr. Rasto Brezny, Manufacturers of Emission Controls Association Mr. Kevin Brown, Engine Control System Mr. Tim Carmichael, Coalition for Clean Air Ms. Bonnie Holmes-Gen, American Lung Association of California Mr. Julian Imes, Donaldson Filtration System Ms. Kathy Lynch, Plug in American Mr. Donel Olson, Olson-Ecologic Engine Test Lab Mr. Tom Swenson, Cleaire PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 5 INDEX PAGE Pledge of Allegiance 1 Roll Call 1 Opening Remarks by Chairperson Nichols 2 08-1-1 Executive Officer Goldstene 7 Staff Presentation 8 Board Discussion and Q&A 13 08-1-2 Chairperson Nichols 13 Executive Officer Goldstene 13 Staff Presentation 15 Board Discussion and Q&A 21 Motion 27 Vote 27 08-1-3 Chairperson Nichols 27 Executive Officer Goldstene 28 Board Discussion and Q&A 36 08-1-4 Chairperson Nichols 37 Executive Officer Goldstene 38 Board Discussion & Q&A 46 Motion 57 Vote 58 08-1-5 Chairperson Nichols 59 Staff Presentation 59 Motion 62 Vote 62 08-1-8 Chairperson Nichols 62 Executive Officer Goldstene 63 Staff Presentation 65 Ombudsman Quetin 86 Dr. Brezny 86 Mr. Imes 89 Mr. Olson 92 PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 6 INDEX CONTINUED PAGE 08-1-8(continued) Mr. Brown 94 Mr. Swenson 99 Ex Parte Communications 107 Board Discussion and Q&A 107 Motion 112 Vote 113 07-12-10 Staff Presentation 116 Mr. Carmichael 121 Ms. Holmes-Gen 123 Ms. Lynch 125 Board Discussion and Q&A 125 Motion 127 Vote 127 Public Comment 128 Adjournment 128 Reporter's Certificate 129 PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 7 1 PROCEEDINGS 2 CHAIRPERSON NICHOLS: We're ready to start. Good 3 morning, everybody. I'd like to call the January 24th, 4 2008, public meeting of the Air Resources Board to order. 5 This is our first meeting of 2008. Welcome back, 6 everybody. Good to see you all after the holidays. 7 And we will begin our meeting, as we usually do, 8 with the Pledge of Allegiance to the flag. 9 (Thereupon the Pledge of Allegiance was 10 Recited in unison.) 11 CHAIRPERSON NICHOLS: The Clerk of the Board will 12 call the roll. 13 BOARD CLERK ANDREONI: Dr. Balmes? 14 Ms. Berg? 15 BOARD MEMBER BERG: Here. 16 BOARD CLERK ANDREONI: Supervisor Case? 17 BOARD MEMBER CASE: Here. 18 BOARD CLERK ANDREONI: Ms. D'Adamo? 19 Supervisor Hill? 20 BOARD MEMBER HILL: Here. 21 BOARD CLERK ANDREONI: Ms. Kennard? 22 BOARD MEMBER KENNARD: Here. 23 BOARD CLERK ANDREONI: Mayor Loveridge? 24 Mrs. Riordan? 25 Supervisor Roberts? PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 8 1 BOARD MEMBER ROBERTS: Here. 2 BOARD CLERK ANDREONI: Professor Sperling? 3 BOARD MEMBER SPERLING: Here. 4 BOARD CLERK ANDREONI: And Chairman Nichols? 5 CHAIRPERSON NICHOLS: Here. 6 BOARD CLERK ANDREONI: Madam Chair, we have a 7 quorum. 8 CHAIRPERSON NICHOLS: Thank you. 9 Our absent members have all been excused for good 10 reasons, good cause. 11 I did want to mention our newest Board member, 12 Dr. Balmes, who was appointed, and had a conflict with his 13 first meeting. But I've had a chance to meet him and 14 swear him in. And we're going to be very happy to have a 15 physician member back on our board again. So that's a 16 great piece of good news. 17 I have a couple of sort of standard opening 18 remarks here, one of which there's a close session item 19 that appears on the agenda, but we're not having a closed 20 session today. That just routinely goes on the agenda. 21 Anyone who's not familiar with our process, I'd 22 like to make sure that you know that if you want to 23 testify on any item, we'd appreciate it if you would sign 24 up with the Clerk of the Board, who sits over there. And 25 she can give you a speaker card, and then we will make PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 9 1 sure that you get called. 2 The Board does impose a three-minute time limit 3 on public testimony and we follow it pretty rigidly. So 4 please try to summarize your remarks. If you have a 5 longer written statement, just try to -- we make sure that 6 we will read it, but keep your remarks to the three 7 minutes. 8 I'm also supposed to for safety reasons let you 9 know that there's emergency exits at the rear of this room 10 under the green signs that say "exit"; and if there's a 11 fire alarm, we have to evacuate the room and go downstairs 12 and wait until we hear the "all clear" signal. 13 I do have one item that I wanted to mention to 14 the Board before we launch into our regular agenda. And 15 it relates to the last item on today's agenda, which is 16 the Public Records Act request that we received from 17 environmental organizations with respect to the data that 18 was received from the Zero Emission Vehicle Program. And 19 I'm hoping that this message gets out to people who are 20 listening to this over their computers as well as to those 21 who are in the audience. Because yesterday there was a 22 long series of meetings which I think were good and 23 productive but unfortunately did not result in an 24 agreement as we had hoped when we sent the parties off at 25 the end of our last meeting to try to see if they could PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 10 1 resolve their differences; and so this matter will be 2 coming back on our agenda later this afternoon. 3 And since we do business in public here at the 4 Air Resources Board, I wanted to share my thoughts with my 5 fellow Board members as well as with the combatants on 6 this thing so that people will have a chance to think 7 about what they -- people will have a chance to think 8 about what they may want to do when this item comes before 9 us. 10 So in the discussions yesterday, which were 11 attended by our staff -- and Analisa Bevan, who's here I 12 believe today, was very active in providing information to 13 both sides and was in the room for most of the 14 discussions -- it became very clear that there's really 15 not much concern about the data that's currently on file 16 about what credits the individual companies own; that is, 17 it's very possible for our staff to produce a summary 18 without the names of the companies on it and without 19 having to disclose what would be considered to be 20 confidential data by the companies that own that 21 information, that own those credits and that plan to use 22 them. 23 I think it's also very clear that the staff and 24 the Board certainly gave them this indication, wants to 25 change this program going forward, so that it will PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 11 1 be -- it will be public what credits people are trying to 2 use in the future. And so the only real issue that's 3 dividing the parties at this point is when this 4 information will begin to become public. And the 5 negotiations essentially broke down over the issue of 6 whether it was going to be the 2009 model year or the 2010 7 model year. 8 I think both parties came a very long way to try 9 to get to an agreement, but unfortunately they just 10 couldn't get there. I think there may be a desire, 11 frankly, when people get to a point where they're 12 frustrated, almost to get to a point where they would just 13 go to court and sue each other. Although, you know, both 14 sides have said that that's not what they want, I think, 15 you know, when people get frustrated at the end of the 16 day, sometimes they decide that's the only way to resolve 17 their differences. 18 I am hoping that it will not come to that. I 19 truly believe that this Board can act in March when we act 20 on the ZEV Program in a way that going forward makes it 21 clear that the data that is submitted about compliance 22 with the rules will be public. I think I would favor 23 probably doing it for the 2010 model year just because 24 that's when we have enough information that would actually 25 be useful for the next round of ZEV amendments so that PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 12 1 somebody could actually do anything with it. You probably 2 could do it earlier, but that then would run the risk of 3 putting out data that people legitimately felt was 4 confidential when they gave it to us. 5 So, you know, somewhere we might be able to get 6 the data out a little bit earlier, so they'd get it on 7 January 1st instead of in July when they normally get it. 8 I mean these are some details that need to be worked out. 9 But the bottom line here from my perspective is 10 that I do think, as several of you indicated last time, 11 that we're in a position -- we would be put in a position 12 of changing rules in the middle of a game in we were to at 13 this point rule on the Public Record Act and say we were 14 going to release the data. On the other hand having been 15 put in a position by the legal memo that we got from our 16 staff that says the Board gets to weigh the issues, if you 17 ask a public official, or at least if you ask me, "Are you 18 going to release data," you know, you're inclined to say, 19 "Yes, of course." I mean none us is in a position where 20 we want to be on record as saying we don't want to release 21 data. 22 So basically I don't want to have to rule on 23 this, and I don't think we should have to rule on it. I 24 think we should be able to fix this in the rule making 25 that's coming up. And I think we should be able to put PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 13 1 this matter behind us. But we need the parties to go off 2 and make one more attempt at getting a resolution on this 3 so we don't have to be put in a position of doing it for 4 them. 5 So that's what I am -- that's what I would like 6 to communicate with all of you at this point. I welcome 7 any comments that the rest of you have. If not, we'll 8 just take it up when we get to it, which will be sometime 9 after noon today. 10 Staff, did you have any additional comments on 11 that? 12 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: No. 13 EXECUTIVE OFFICER GOLDSTENE: No. 14 CHAIRPERSON NICHOLS: No. Okay. 15 Yes. 16 BOARD MEMBER BERG: I would just like to say, 17 Chairman, thank you very much for your leadership. 18 CHAIRPERSON NICHOLS: Thank you. 19 Okay. So let's now then begin with the health 20 update. 21 EXECUTIVE OFFICER GOLDSTENE: Thank you, Chairman 22 Nichols. 23 Diesel PM is a toxic air contaminant that's been 24 associated with long cancer. As a component of ambient 25 PM, it has also been associated with other adverse health PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 14 1 effects such as exacerbation of chronic heart and lung 2 disease and even premature death. Therefore employees 3 working in and around trucks may be particularly at risk 4 due to their continued exposure to diesel PM. Today's 5 health update on a national study assessing mortality in 6 the unionized U.S. trucking industry provides insight into 7 the adverse health effects associated with job-specific 8 exposures from diesel exhaust. 9 The findings from this study provide the ARB with 10 additional scientific information on the risks from 11 exposure to diesel PM. Moreover, it suggests that 12 regulations developed to reduce exposures to the general 13 population would also significantly reduce the 14 occupational exposures and subsequent health risks to 15 workers. 16 Cynthia Garcia, from our Health and Exposure 17 Assessment Branch, will make the staff presentation this 18 morning. 19 Cynthia. 20 MS. GARCIA: Thank you, Mr. Goldstene. And good 21 morning, Chairman Nichols and members of the Board. 22 Before I actually start I would like to make an 23 announcement. Apparently we're having technical 24 difficulties. And you'll be able to see our presentation 25 on your computers, but for the general public it's not PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 15 1 available. I would like to also let them know that it is 2 available on the web currently for those that are looking 3 at this on the webcast. So we apologize for these 4 technical difficulties. 5 In today's health update I will discuss the study 6 on the health effects by occupation in the U.S. trucking 7 industry. This study is the largest and most 8 comprehensive nationwide assessment of diesel exposure 9 effects on workers in the trucking industry. We will 10 focus on the first set of findings from the study today. 11 First, I will briefly go over some background 12 information on diesel. Diesel engines emit a conflict 13 mixture of gaseous and particulate matter air pollutants. 14 In 1998, California identified diesel exhaust 15 particulate matter, PM, as a toxic air contaminant based 16 on its potential to cause cancer. Diesel PM from exhaust 17 is also a contributor to ambient PM in California. A 18 growing body of literature exists which links ambient PM 19 exposures to adverse health effects, such as heart 20 attacks, lung cancer, and even premature death. However, 21 fewer studies have investigated the effects associated 22 with occupational exposure to diesel engine exhaust, which 23 is a concern because employees working in and around 24 trucks may be particularly at risk due to their continued 25 exposures to diesel PM. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 16 1 The study that I am presenting today is a 2 national study led by Harvard University that involves the 3 participation of about 54,000 members of the Teamsters 4 Union from four companies. 5 The investigators examined the medical history of 6 teamsters employed from 1985 to the year 2000 by job 7 category. Each job category in this population has a 8 distinct exposure pattern. For example, long-haul and 9 pickup and delivery drivers are exposed directly to 10 traffic. Dock workers are exposed to trucks in the yard 11 and exhaust from forklifts. 12 A questionnaire was mailed to current workers to 13 assess the distribution of smoking habits by job title and 14 terminal characteristics. The smoking rates were similar 15 to the general U.S. population for both drivers and 16 non-drivers. 17 To provide insight into death patterns associated 18 with these exposures, the investigators examined death 19 rates for specific causes by the different job categories 20 in the trucking industry compared to the general U.S. 21 population of the same age group. 22 --o0o-- 23 MS. GARCIA: This study found that the employees 24 had a lower overall death rate than the general 25 population, as would be expected in a working population. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 17 1 However, when deaths due to heart disease and lung cancer 2 were compared to the general U.S. population, the death 3 rate of observed was elevated, especially for drivers and 4 dock workers. The death rates for heart disease were 5 elevated among drivers by 49 percent and dock workers by 6 32 percent. And lung cancer death rate was also elevated 7 among drivers and dock workers by 10 percent. 8 Note that this study did not have information on 9 participants' individual exposure or life style, including 10 factors that could impair their health such as dietary 11 preferences and amount of exercise. Current research by 12 the investigators are measuring the actual diesel exposure 13 by job categories. 14 --o0o-- 15 MS. GARCIA: The study's findings are important 16 to the U.S. trucking industry since they provide insight 17 into the adverse health effects associated with 18 job-specific exposure mostly from diesel exhaust. But 19 these results are also important to the general population 20 that live, commute or work in proximity to diesel fuel 21 traffic or trucking terminals. 22 The findings also provide the ARB with additional 23 scientific information on the risk from exposure to diesel 24 exhaust. Moreover, they suggest that regulations 25 developed to reduce diesel exposure for the general PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 18 1 population would also significantly reduce the 2 occupational exposure and subsequent health risk to 3 workers. 4 --o0o-- 5 MS. GARCIA: It is worth noting that over the 6 last 40 years, as shown in this graph from the 7 Lawrence-Berkeley Laboratory, there has been about an 8 18-fold decrease in diesel soot from improvements in 9 on-road engines and fuel in the Bay Area. This reduction 10 directly affects the occupational exposure for the 11 trucking industry since it shows that diesel engines and 12 fuel are getting cleaner. 13 In addition, even though fuel consumption is 14 going up about sixfold, ambient diesel soot has decreased 15 about threefold. This reduction in ambient and diesel 16 engine soot is due in large part to ARB's and federal 17 regulations and enforcement programs. 18 ARB most recent efforts include the diesel risk 19 reduction plan to reduce particulate matter emissions from 20 diesel fuel engines in vehicles. The Board also provides 21 incentive funds to retrofit existing diesel fleets through 22 you Carl Moyer program and has implemented the Goods 23 Movement Emission Reduction Plan to reduce impacts from 24 diesel fuel engines, especially from port, truck, and 25 locomotive associated activities. These and future PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 19 1 regulatory efforts will reduce diesel exhaust exposure for 2 workers and the general population, leading to an 3 improvement in public health? 4 This concludes my presentation. I will be happy 5 answer to answer any questions. 6 CHAIRPERSON NICHOLS: Thank you. 7 Questions from members of the Board? 8 It's pretty challenging work here. These are 9 pretty dramatic numbers. And I assume there's going to be 10 a lot of interest on the part of the trucking industry as 11 well as the drivers in this. 12 All right. Thank you. Thanks very much. 13 MS. GARCIA: Thank you. 14 CHAIRPERSON NICHOLS: Our next item addresses the 15 Research Screening Committee's membership and some 16 research proposals for our consideration. 17 EXECUTIVE OFFICER GOLDSTENE: Thank you, Chairman 18 Nichols. 19 (Thereupon an overhead presentation was 20 Presented as follows.) 21 EXECUTIVE OFFICER GOLDSTENE: First I'd like to 22 acknowledge the service of two members of the Research 23 Screening Committee who have recently resigned. 24 Our newest Board member, who could not be here 25 today, Dr. John Balmes, served on the Research Screening PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 20 1 Committee for nine years. Dr. Balmes has been 2 instrumental in the success of the Board's health and 3 exposure research programs. His background in medicine 4 has given him a unique perspective and understanding in 5 applying the scientific literature for the purpose of 6 advancing health protective public policy for children 7 with asthma. We're delighted to continue to work with him 8 in his new role. 9 Professor Michael Prather served on the Research 10 Screening Committee for four years Professor Prather has 11 been a key advisor to the Board on climate change science 12 issues pertaining to Assembly Bill AB 1493 and Assembly 13 Bill 32. His demonstrated foresight and commitment to 14 protecting the people of California our sincerely 15 appreciated. 16 The research to be covered today by the proposals 17 before you today focus on economic valuation of 18 cardiovascular disease, monitoring pollutants in 19 environmental justice community, developing a model of 20 goods movement, reducing emissions from agricultural 21 fumigation, and developing an inventory for gases with 22 high global warming potential. 23 Heather Choi of the Research Division will make 24 the staff presentation. 25 Heather. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 21 1 AIR POLLUTION SPECIALIST CHOI: Thank you, Mr. 2 Goldstene. Good morning, Chairman Nichols and members of 3 the Board. 4 We have five research proposals for you to 5 consider this morning. These projects were part of the 6 2007-2008 research plan and have been reviewed and 7 approved by the Board's Research Screening Committee. I 8 will briefly describe the objective and expected results 9 for each project. 10 --o0o-- 11 AIR POLLUTION SPECIALIST CHOI: The first project 12 will develop a California-specific inter modal freight 13 transport model. The state's economy and quality of life 14 depend upon the efficient and safe delivery of goods to 15 and from the state. From the years 2002 to 2020 the 16 volume of international trade in California is projected 17 to at least double. Understanding the impact of planned 18 transportation infrastructure projects on emissions is 19 necessary to help identify new ways to reduce emissions 20 associated with goods movement and reduction of these 21 emissions is essential to ensure the protection of public 22 health. Therefore, a statewide freight model is required 23 and should be developed based on a thorough understanding 24 of how goods move through California's port, highway, and 25 rail systems. This project is intended to result in a PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 22 1 geographic information system compatible model to quantify 2 emissions, evaluate trade-offs and identify optimal 3 freight movement strategies. 4 --o0o-- 5 AIR POLLUTION SPECIALIST CHOI: The original 6 project contract for which an augmentation to this next 7 project is requested was intended to evaluate the use of a 8 low-cost monitoring technique and to characterize 9 neighborhood level exposures to pollutants to air 10 pollutants in our harbor communities of Los Angeles. An 11 augmentation to the original contract is necessary to 12 implement several proposed modifications to the original 13 study plan including the addition of a passive sampling 14 station at the University of Southern California as a 15 comparison site, the addition of monitoring to cover the 16 anticipated fall and winter peak freight traffic period, 17 and compensating homeowners and private businesses that 18 assisted with the placement of monitoring stations. 19 --o0o-- 20 AIR POLLUTION SPECIALIST CHOI: Before the harbor 21 community's monitoring study, ambient air quality 22 monitoring in the region was limited to two long-term 23 sites and one short-term site operated by the South Coast 24 AQMD and four sampling sites operated by the Port of Los 25 Angeles. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 23 1 During the study the air quality monitoring 2 network was greatly enhanced. ARB contractors added 3 several non-traditional monitoring methods. DRI conducted 4 passive sampling at 23 sites. USC Conducted ultra fine 5 particle counts at 13 sites. And UCLA in conjunction with 6 ARB conducted intermittent sampling with an electric 7 vehicle. 8 The Port of Long Beach and the South Coast AQMD 9 also initiated sampling at new sites. 10 The results obtained from this project will be 11 used to evaluate the spatial variations in concentrations 12 of toxic air contaminants and their co-pollutants within 13 the communities adjacent to the ports of Los Angeles and 14 Long Beach. 15 --o0o-- 16 AIR POLLUTION SPECIALIST CHOI: The next project 17 will address the economic value of reducing the incidence 18 of cardiovascular disease. Recent health effects research 19 points toward air pollutants as risk factors for the onset 20 of several chronic respiratory and cardiovascular 21 illnesses. 22 The objective of this project is to better 23 quantify the health benefits of air pollution control in 24 California and estimate the economic value of reducing the 25 risk of developing cardiovascular disease. The study team PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 24 1 will design, implement, and analyze a willingness to pay 2 survey that develops a monetary estimate for individuals 3 to reduce their risk of developing cardiovascular disease. 4 The result of this project will allow ARB staff 5 to apply the study's findings in order to gauge the 6 economic benefit of regulating air pollutants that impact 7 incidence of cardiovascular disease. 8 --o0o-- 9 AIR POLLUTION SPECIALIST CHOI: The next project 10 is on augmentation to a project that addresses the 11 reduction of emissions of volatile organic compounds from 12 agricultural soil fumigation. The State Implementation 13 Plan for ozone includes volatile organic compound emission 14 reduction requirements for fumigant pesticides. 15 The California Department of Pesticide Regulation 16 is developing regulations that are designed to achieve a 17 20 percent reduction in VOC emissions from fumigant 18 pesticides. However, there is still some uncertainty in 19 the exact magnitude of the emissions reductions that will 20 be achieved by DPR's regulations. This uncertainty is due 21 mainly to the relatively small amount of experimental data 22 for fumigant pesticide emission rates and for the emission 23 reduction potential of the available control strategies. 24 The principal investigator will perform 25 additional small scale soil and laboratory experiments to PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 25 1 estimate fumigant emission rates and the emissions 2 reduction potential strategies that will be considered and 3 used by DPR. 4 This project will provide the needed data to 5 ensure that anticipated emission reductions from the DPR 6 regulations are realized and that the SIP commitments for 7 fumigant pesticides are met. 8 --o0o-- 9 AIR POLLUTION SPECIALIST CHOI: Here are field 10 study photographs of Dr. Scott Yates previous work for us 11 in Buttonwillow, California. 12 --o0o-- 13 AIR POLLUTION SPECIALIST CHOI: The last project 14 will address greenhouse gas reduction strategies; in 15 particular, strategies to reduce emissions from 16 ozone-depleting substances such as fire suppressants and 17 industrial cleaning solvents. 18 --o0o-- 19 AIR POLLUTION SPECIALIST CHOI: The Climate 20 Action Team report identified a suite of strategies for 21 reducing the six Kyoto protocol pollutants. Based upon 22 further investigation, it has become apparent to ARB staff 23 that there are further opportunities for emissions 24 reductions, particularly if ozone-depleting substances are 25 considered. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 26 1 Ozone-depleting substances deplete ozone in the 2 stratosphere by our also potent greenhouse gases. The 3 purpose of the proposed research is to generate a 4 California-specific bottom-up high global warming 5 potential greenhouse gas inventory for each 6 ozone-depleting greenhouse gas used in industry 7 applications. 8 The results of this study will ultimately help 9 ARB evaluate CO2 equivalent greenhouse gas emissions 10 reductions in future years due to various control 11 strategies in terms of cost and/or benefits. 12 It will also help to prioritize as well as 13 identify new mitigation opportunities so that those 14 presenting the greatest benefits receive the most 15 attention. Such strategies would not only reduce 16 greenhouse gas emissions, but would in some cases provide 17 co-benefits by mitigating emissions of substances that 18 cause stratospheric ozone depletion. 19 --o0o-- 20 AIR POLLUTION SPECIALIST CHOI: This concludes 21 the presentation. We recommend you approve these research 22 proposals. 23 We will be happy to answer any questions. 24 CHAIRPERSON NICHOLS: Okay. Thank you. 25 Questions about any of these individual research PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 27 1 projects? 2 I'm looking at our researcher on the Board just 3 to see if he had any. 4 BOARD MEMBER SPERLING: I have some general 5 thoughts. 6 CHAIRPERSON NICHOLS: Okay. 7 BOARD MEMBER SPERLING: You know, yesterday 8 having sat through a hearing about ARB and its activities, 9 it became all too obvious to me and evident to me how 10 important it is for ARB to maintain a strong technical 11 capability. And I think that is what sets ARB apart from 12 almost all government agencies that I've seen, is that, 13 you know, it really is the staff that's sophisticated, 14 knowledgeable, keeping up with the literature and the 15 scientific advances, and using that for the rule making 16 and program development. 17 And so I see these projects and I'm -- you know, 18 I'm quite pleased, because, one, they're being done very 19 cost efficiently. I'm very impressed with the low cost of 20 some of these projects. 21 And it is going to be, you know, as we move 22 into -- I mean we've got enough challenges with the 23 criteria pollutants and issues around ports and 24 environmental justice and understanding, you know, what 25 these impacts are and how to deal with them. And as we PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 28 1 move into climate change, you know, we've got this huge 2 new area that we've got to become more sophisticated 3 about. 4 And so, you know it's both very impressive what 5 has been accomplished and daunting what needs to be. And, 6 you know, I've talked to staff and, you know, there's a 7 lot of money becoming available outside of ARB for a lot 8 of research in California. And so I think there's going 9 to be -- there is -- the staff is doing a good job in 10 trying to leverage ARB funds effectively and also help 11 create a research agenda that can feed into our 12 policy-making process. 13 So, you know, just an over all sense of -- 14 overall comment that this is so important for the success 15 of ARB in the future. And that I think that -- you know, 16 it's a daunting task ahead of us in building the research 17 foundation and being able to work -- you know, work with 18 that knowledge base. But I have faith and I've been 19 impressed with the staff that, you know, it is moving in 20 that direction even though it is daunting. 21 CHAIRPERSON NICHOLS: Right. Thank you for that 22 reminder. 23 I have a question actually about the research 24 agenda. Individually and collectively these seem like a 25 very good set of research proposals and a worthwhile PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 29 1 expenditure of money. I agree, the funds seem to be, you 2 know, pretty well trimmed and tailored to not to exceed 3 our budget. 4 But I'm curious about sort of the overall 5 research plan and perspective. I know we've made 6 additions and somewhat changed the makeup of the Research 7 Screening Committee. But I haven't actually seen an 8 annual update on the research plan. And I know from an 9 encounter with one of the members of the screening 10 committee that they are eager for input from the Board in 11 terms of having a better sense of what our priorities are 12 as well. So I thought maybe, Mr. Croes, you might want to 13 comment on where we are in terms of our overall planning 14 for the research agenda. 15 RESEARCH DIVISION CHIEF CROES: We have actually 16 two research planning efforts. Because the Climate Change 17 Program has taken on such importance and because there 18 seems to be a need to coordinate with other agencies, both 19 state, federal as well as industry, that we're putting 20 together a comprehensive research roadmap that would not 21 just focus on the scientific underpinnings of what we're 22 doing with AB 32 but also technology advancement and 23 deploying new technologies. 24 So we've partnered with the Climate Action Team 25 members including the California Energy Commission, the PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 30 1 PUC, the Resources agencies, as well as several academics 2 to put together this research roadmap. And we plan to 3 bring that to the Board in April. So that would be a 4 long-term vision for where the state needs to go on 5 climate research. And it includes a catalogue of 6 everything that's going on in the state right now, whether 7 funded by us, the feds, or the private sector. 8 We also have an annual planning process, and 9 we're in the middle of that. So we've done a public 10 solicitation. We've gotten I think over 200 ideas from 11 the public. That's being vetted right now through the 12 Research Screening Committee. Then it will go through our 13 Executive Office and be brought to the Board in May. And 14 so that will lay what specific projects we fund over the 15 coming fiscal year. 16 CHAIRPERSON NICHOLS: Thank you for that update. 17 You want to finish up first then, Mr. Sperling? 18 BOARD MEMBER SPERLING: Just to follow up on 19 that. You know, this really is so critical and so 20 important and I just -- you know, I don't know what I want 21 to suggest, but that I think we need to put a little more 22 effort into these kind of research plans than perhaps we 23 have in the past, you know, partly because, you know, on 24 the climate side especially, you know, we're kind of ahead 25 of the rest of the country, I've noticed. And, you know, PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 31 1 what that means is that kind of our needs at ARB are more 2 urgent than elsewhere. And what I've learned in crossing 3 the boundary from the research world to this up here on 4 the dais here is that, you know, researchers don't 5 always -- usually don't understand exactly how their 6 research could be or will be used. And it's the role of, 7 you know, the ARB staff to be working with the researchers 8 to try to develop these agendas that are very targeted to 9 what our needs are. 10 And given that our needs are pretty much distinct 11 from almost everyone else right now, that -- you know, I 12 guess I just urge even extra thought and input into this 13 process on the ARB side in terms of what our needs really 14 are and how we can leverage, you know, other programs and 15 so on. 16 CHAIRPERSON NICHOLS: Well, I think that -- I 17 would take that as a suggestion that the Board should 18 perhaps try to schedule -- I know we've got a big year 19 ahead of us and we're going to be hearing more about that, 20 but to try to schedule some time for a workshop kind of 21 setting where we would invite some of the research 22 community in to talk with us about those very issues. 23 Ms. Berg. 24 BOARD MEMBER BERG: And I appreciate the comment 25 of my fellow Board members, because as I look at my PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 32 1 responsibility to vote and obviously a great slate of 2 research in front of us, but the question for me becomes, 3 what's the plan, what are the categories, are we covering 4 the product spectrum that we need to be considering? And 5 I'm not trying to second guess the research -- the hard 6 work of the Research Committee. But when I look at 7 economic value of reducing cardiovascular disease, it just 8 occurs to me for almost $400,000 that we understand and we 9 have some data specifically how is this particular body of 10 research going to help us make decisions differently. Or 11 are they just going to confirm decisions we're already 12 making? Which then would lead me to a question, are we 13 filling all the holes in the categories of the research 14 buckets that we need to be addressing? 15 So I'm not asking -- or challenging any 16 particular program here. But what I'm saying is that I 17 agree with my fellow Board members that I really feel a 18 little more information on the plan would really be 19 assistance to me. 20 EXECUTIVE OFFICER GOLDSTENE: Well, we'll make 21 sure that when we provide the overall vision and plan in 22 April, that we'll provide the context on our plans on how 23 we make the bridge, as Professor Sperling said, between 24 the research and the application of the research. 25 BOARD MEMBER BERG: Great. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 33 1 CHAIRPERSON NICHOLS: Thank you. 2 Do I have a motion and a second to approve 3 Resolution No. 081 through 085? 4 BOARD MEMBER HILL: I'll move resolutions. 5 CHAIRPERSON NICHOLS: Moved. 6 Second? 7 BOARD MEMBER KENNARD: Second. 8 CHAIRPERSON NICHOLS: Okay. All in favor say 9 aye. 10 (Ayes.) 11 CHAIRPERSON NICHOLS: Any opposed? 12 Very good. Thank you. I appreciate the 13 discussion. 14 (Thereupon an overhead presentation was 15 Presented as follows.) 16 CHAIRPERSON NICHOLS: Okay. The next item, which 17 actually the first one just leads into quite nicely, is 18 the Executive Officer's Report on the Air Resources 19 Board's Action Plan for 2008, previewing what the ARB 20 staff is going to be working on and presenting to the 21 Board over the coming year. 22 So I hope all of you have your calendars at the 23 ready. Or if not at the ready, at least that you're 24 prepared for a busy year. Because, as you're going to 25 hear, we've got a lot in store. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 34 1 Mr. Goldstene. 2 EXECUTIVE OFFICER GOLDSTENE: Thank you, Chairman 3 Nichols. 4 Well, it's a new year. And of course we want to 5 kick it off with a preview of the upcoming activities for 6 2008. 7 Next slide. 8 --o0o-- 9 EXECUTIVE OFFICER GOLDSTENE: Meeting air quality 10 standards of course continues to be a top priority. 11 Addressing emissions from goods movement is critical for 12 meeting air quality standards as well as reducing 13 community impacts near port and rail facilities. Our 14 expanding climate change efforts will be enforced this 15 year as we develop the AB 32 scoping plan, low carbon fuel 16 standard, and other early action items and continue of 17 course our effort to get our waiver. 18 There's no question that the work this year is 19 going to be very demanding and we'll be moving at a very 20 ambitious pace. But with your support and the new 21 resources we've been getting from, you know, staff we're 22 prepared, we believe, to meet the challenge. 23 Next slide. 24 --o0o-- 25 EXECUTIVE OFFICER GOLDSTENE: Last year was a PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 35 1 very successful year for ARB. We took a number of actions 2 to clean up our ports and harbor fleets and continued the 3 demanding task of cleaning up our on- and off-road diesel 4 fleet statewide. 5 We began the serious work of implementing AB 32, 6 the Global Warming Solutions Act, including creating the 7 Environmental Justice Advisory Committee and the Economic 8 and Technology Advancement Advisory Committee and 9 developing a list of early actions. 10 A number of these early actions will be coming to 11 the Board for your approval in the coming months. We'll 12 also meet the ambitious statutory deadlines for adopting 13 regulations to require -- we met the statutory deadlines 14 for adopting regulations to require mandatory reporting of 15 greenhouse gases and for putting in place the 1990 16 baseline that defines our 2020 target under AB 32. 17 In addition of course the Board adopted the State 18 Implementation Plans for the South Coast and San Joaquin 19 Valley. 20 --o0o-- 21 EXECUTIVE OFFICER GOLDSTENE: During the year 22 we'll tighten the number of existing regulations and 23 target new sectors for emission reductions. Starting next 24 month the Board will consider guidelines for distributing 25 the Proposition 1B bond funds, the Goods Movement PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 36 1 Emissions Reduction Program, and follow up in March with 2 Moyer and low emission school bus guidelines. 3 We did most of the work last year to get the SIPs 4 in place but for the new federal ozone and PM2.5 5 standards. However, in 2008 we still have a little bit of 6 work to do, including adopting SIPs to establish 7 conformity budgets for some areas and SIPs for the 8 remaining ozone nonattainment areas including Sacramento. 9 In late spring at a hearing in the San Joaquin 10 Valley you'll consider approval of the Valley's PM2.5 11 plan. 12 On the technology front this spring staff will 13 bring to you updates to the ZEV Program based on the 14 information from the Technology Review Panel and ongoing 15 discussions with stakeholders. Of course this will garner 16 a lot of public attention. 17 Finally, during the year we'll also present 18 results of our ongoing risk assessment work related to 19 goods movement. We'll also discuss with you the most 20 recent science about health effects of particles, 21 especially particulate matter related mortality and of the 22 related policy implications. 23 --o0o-- 24 EXECUTIVE OFFICER GOLDSTENE: So let me focus a 25 little more on the rulemaking. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 37 1 On the air quality front, staff is developing a 2 comprehensive rule for heavy-duty trucks that parallels 3 last year's rulemaking for construction fleets. And 4 although not on the Board calendar until next year, staff 5 will be doing the basic technical emission inventory work 6 needed to support a rule to clean up agricultural 7 equipment. Both of these rules are SIP commitments made 8 last year and address multi-public health issues - diesel 9 toxicity, fine particulate pollution, and ozone health 10 effects. 11 We'll also propose a requirement for cleaner 12 fuels for ocean-going vessels as part of our push to clean 13 up emissions at our state's harbors and ports. As one of 14 our ozone SIP commitments we'll bring to the Board another 15 round of consumer products regulations as well. 16 --o0o-- 17 EXECUTIVE OFFICER GOLDSTENE: It's become 18 increasingly clear that funding cleanup of diesel engines 19 in conjunction with ARB regulations maximizes our air 20 quality progress. Expenditures of the State Proposition 21 1B funds will provide public health benefits throughout 22 California. Given the urgency, we put the development of 23 the required guidelines on a fast track for consideration 24 at next month's Board meeting. Then we can begin awarding 25 the monies, the first $250 million allocation of those PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 38 1 funds. 2 Last year's Assembly Bill 118 provides another 3 clean air funding source through the Air Quality 4 Improvement Program, which will grant award monies to 5 projects to reduce air pollutants. This bill also set 6 aside $30 million annually for early vehicle retirement. 7 This new funding source complements the 8 successful Carl Moyer Program. And as I had mentioned 9 earlier, program revisions to the Moyer Program will also 10 be brought to you this year. 11 --o0o-- 12 EXECUTIVE OFFICER GOLDSTENE: Enforcement of ARB 13 regulations is essential to our air quality progress. 14 Even the best programs are of little value without the 15 tools necessary to make sure they're being put into place. 16 Staff is developing a plan to enforce ARB's new 17 diesel fleet rules consistent with the legislative 18 requirement for Strategic Enforcement Plan for these 19 rules. 20 The comprehensive nature of our diesel fleet 21 rules makes a strong enforcement program a priority. This 22 includes focusing community-oriented efforts on diesel 23 trucks. Lastly, will continue to enforce our mobile 24 source fuels and consumer products regulations that are 25 providing the vast majority of the new emission reductions PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 39 1 we see in California each year. 2 --o0o-- 3 EXECUTIVE OFFICER GOLDSTENE: Of course central 4 to this year's effort Board's agenda is our effort to 5 reduce greenhouse gas emissions. Staff will bring a draft 6 of the scoping plan to you in June, with a final version 7 presented for your approval in November. 8 Staff is working to bring seven early action 9 items to the Board this year: The low carbon fuel 10 standard, requirements for do-it-yourself motor vehicle 11 air conditioning units, requirements for methane capture 12 at landfills, a manure management measure, SmartWay 13 efficiency improvements for trucks, semiconductor 14 manufacturing, and high global warming potential consumer 15 products. 16 We'll also bring up for Board approval a number 17 of measures as part of the effort to establish a framework 18 for accurately quantifying greenhouse gas reductions 19 through protocols and also establishing emission 20 reductions verifications programs. 21 --o0o-- 22 EXECUTIVE OFFICER GOLDSTENE: To support your 23 decision making on the scoping plan, staff will brief you 24 over the next several months on a number of climate change 25 topics. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 40 1 While California has been a world leader on air 2 pollution for decades, climate change brings a number of 3 new issues and factors for consideration into the picture. 4 We'll start next month with vehicle technology. We'll 5 follow that with briefings on what economic analyses staff 6 will be using and the role of the electricity and energy 7 sectors in the state's climate change efforts. 8 In addition, staff is focusing this year's 9 Haagen-Smit symposium on land use and climate change. 10 Changes in how California accommodates its growth is 11 critical to meeting our climate change goals particularly 12 as we look towards 2050. 13 So following the Haagen-Smit symposium, staff 14 plans to brief you on the challenges and opportunities 15 before us in terms of encouraging local land-use decisions 16 that factor in greenhouse gas impacts. 17 Finally, there are a variety of mechanisms for 18 reducing greenhouse gases, from direct regulations to 19 various market-based systems. As you know, staff held a 20 successful workshop earlier this month on that subject. 21 Given the breadth and complexity of the subject 22 of some of the mechanisms, staff is still deliberating on 23 how best to brief you. It's difficult to fit the subject 24 matter into a typical staff presentation like this. So 25 we're looking at more extended formats where we can devote PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 41 1 the needed time and bring you the right experts to answer 2 your questions. 3 We'll keep you posted of course as our thinking 4 develops on that. And that may include holding 5 workshops -- Board workshops. So that will be more of 6 your time. 7 (Laughter.) 8 --o0o-- 9 EXECUTIVE OFFICER GOLDSTENE: While ARB and other 10 state agencies have been aggressively working on climate 11 change for about a year and a half, since AB 32 was put 12 into place, the pace accelerates as we meet -- as we work 13 to meet the AB 32 timeline. 14 In April, staff will hold a climate change 15 scenario workshop outlining in broad terms the options for 16 meeting the AB 32 goals. The intent of that is to weigh 17 the different measures to see how they fit against each 18 other. 19 As I mentioned before, staff will release the 20 draft scoping plan in June, that's the end of June, at the 21 June Board meeting. And we'll follow that with a series 22 of workshops on the plan throughout the state. 23 Staff is targeting a release of the final scoping 24 plan this fall with the hearing in November for your 25 consideration. The plan has to be adopted under AB 32 by PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 42 1 January 1st, 2009. 2 Lastly, the Board's work on California's tough 3 air quality issues has been recognized in the Governor's 4 proposed budget, which provides 85 new staff to carry out 5 our Diesel Enforcement Program, develop our early action 6 measures for climate, and administration of the a AB 118 7 fund. 8 We appreciate the strong public support and 9 participation we've experienced as we implement AB 32 and 10 all the other public health programs. 11 --o0o-- 12 EXECUTIVE OFFICER GOLDSTENE: So to conclude, 13 last year laid the groundwork for many of our important -- 14 so many of our important programs. And this year we'll 15 build on that, to move forward on climate change and to 16 continue to strengthen our already strong air quality 17 program. 18 I'd like to thank the Board for your commitment, 19 and, staff, to tackling the challenging issues we have 20 this year. 21 That concludes my presentation. We're all happy 22 to take any questions. 23 CHAIRPERSON NICHOLS: Thank you. 24 As I said before, we've got a lot of work ahead 25 of us. But I feel like we have it in a well organized PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 43 1 condition to bring to the Board. 2 I would welcome input from the Board members 3 either today or later in terms of how they think it might 4 be most effective to really delve into some of these 5 questions. The combination of the short timeframes that 6 we tend to have for items and, frankly, the make-up of the 7 room, you know, when we're here up on the high dais and 8 staff and others are down below is not really conducive to 9 information sharing. And at a minimum, I'm hoping that, 10 you know, if we do something more like a workshop format, 11 that we would do it in one of the other conference rooms 12 where we could set up the tables in a square or in a 13 circle and, you know, people could actually feel free to 14 exchange in more of a dialog than the kind of format that 15 we have here. 16 But I know everybody here has at least one other 17 job and other things to do. So any suggestions that you 18 have about how to make the information sharing more 19 efficient will be much appreciated. 20 Okay. Well, thank you. You've given us a lot to 21 think about. 22 Our next item is consideration of some proposals 23 for the ARB's Innovative Clean Air Technologies Grant 24 Program. This program is in its 14th year and it supports 25 demonstrations of technologies that have high potential PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 44 1 for providing emission reductions as well as benefiting 2 the state's economy. It's really a wonderful program, 3 which I actually didn't know about till I got here. It 4 had apparently slipped in without my being aware of it. 5 But it obviously has done a lot of good in the past and 6 has potential to do some significant things in the future. 7 So today we have three proposals for funding from 8 this ICAT Program. 9 And, Mr. Goldstene, if you want to tee this up. 10 EXECUTIVE OFFICER GOLDSTENE: Thank you, Chairman 11 Nichols. 12 The ICAT Grant Program co-funds projects that 13 move promising technologies from the research and 14 development phase into practical demonstrations. This 15 year we received over 62 pre-proposals that were pared 16 down to the three full proposals that we are recommending 17 considering -- that we are recommending. They total about 18 $498,000 in requested ICAT support. 19 I'll now turn the presentation over to Jorn 20 Herner. 21 GREENHOUSE GAS TECHNOLOGY & FIELD TESTING SECTION 22 MANAGER HERNER: Thank you, Mr. Goldstene. And good 23 morning, Chairwoman Nichols and members of the Board. 24 (Thereupon an overhead presentation was 25 Presented as follows.) PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 45 1 GREENHOUSE GAS TECHNOLOGY & FIELD TESTING SECTION 2 MANAGER HERNER: Today I will discuss the Innovative Clean 3 Air Technologies program, known as ICAT. 4 CHAIRPERSON NICHOLS: Could you get a little 5 closer to the mike. 6 GREENHOUSE GAS TECHNOLOGY & FIELD TESTING SECTION 7 MANAGER HERNER: Sure. Sorry about that. 8 CHAIRPERSON NICHOLS: Thank you. 9 GREENHOUSE GAS TECHNOLOGY & FIELD TESTING SECTION 10 MANAGER HERNER: Today I'll discuss the Innovative Clean 11 Air Technologies program, known as ICAT, and the new 12 projects for which we're proposing funding. 13 --o0o-- 14 GREENHOUSE GAS TECHNOLOGY & FIELD TESTING SECTION 15 MANAGER HERNER: ICAT supports field demonstrations of 16 technical innovations that will control air pollution or 17 otherwise supports ARB's clean air objectives and that 18 have economic value for the state. The program is 19 designed to help promising technologies survive what we 20 call the Valley of Death, the historically least funded 21 part of the product development cycle and where many 22 promising innovations stumble. The intent is to 23 facilitate the commercialization of the technologies by 24 demonstrating their viability in commercial applications. 25 In addition to looking for emission control PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 46 1 technologies, we also invite applications for new air 2 monitoring and measurement instruments. 3 --o0o-- 4 GREENHOUSE GAS TECHNOLOGY & FIELD TESTING SECTION 5 MANAGER HERNER: ICAT co-funds up to half the budgets of 6 qualified demonstration projects. It does not buy 7 equipment for whole sites and it does not pay for 8 overhead. Projects are defined by work plans that include 9 performance milestones that which ICAT accepts invoices 10 for covered expenses. Invoices are paid only if 11 milestones are achieved and the co-authors have met their 12 commitments. 13 It a grantee does not meet his commitments or a 14 project is not progressing, the project and the grant are 15 terminated. 16 --o0o-- 17 GREENHOUSE GAS TECHNOLOGY & FIELD TESTING SECTION 18 MANAGER HERNER: In February of last year we issued a 19 solicitation for proposal abstracts via Email. As 20 previously mentioned, we received 62 pre-proposal 21 abstracts, which ARB staff reviewed to determine which had 22 potential for ICAT participation. We invited 20 23 applicants to submit full proposals and we received 17. 24 The full proposals were reviewed by staff in the 25 Research Stationary Source and Mobile Source Control PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 47 1 Divisions by staff at the South Coast Air Quality 2 Management District and by faculty at the University of 3 California and California State University campuses. 4 Proposals were ranked by considering the quality 5 or novelty of the innovation, the quality of the proposed 6 demonstration project, the potential for emission 7 reduction from sources that are significant contributors 8 to air pollution, and the potential for successful 9 commercialization. 10 For the last criteria the applicant must provide 11 a business plan to bring the product to market that can 12 also be used to evaluate the associated economic benefit 13 to the state. 14 --o0o-- 15 GREENHOUSE GAS TECHNOLOGY & FIELD TESTING SECTION 16 MANAGER HERNER: Today we're recommending three new 17 grants, for a total ICAT funding of approximately 18 $498,000. The ICAT funds would support projects whose 19 budget total about $1.1 million. 20 The three grants would fund the demonstration of 21 a low cost solar water heater, an advanced particle 22 filter, and a mobile platform used to measure greenhouse 23 gases. 24 --o0o-- 25 GREENHOUSE GAS TECHNOLOGY & FIELD TESTING SECTION PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 48 1 MANAGER HERNER: I will now give a brief summary of the 2 three projects that we're recommending for funding. 3 The first grantee would be the Davis Energy 4 Group. The Davis Energy Group has developed a solar water 5 heating system called SunCache, that is designed to 6 preheat water entering a conventional water heater in 7 residential application. The Davis Energy Group is asking 8 for $335,000 in ICAT funding and will contribute along 9 with their sponsors $240,000 in funding to the project. 10 The heart of the SunCache system is a rotational 11 molded polyethylene panel that contains 50 gallons of 12 water. The water serves as a thermal storage and heat 13 transfer fluid. Submersed in the panel is a serpentine 14 copper heat exchanger that contains pressurized domestic 15 hot water. 16 An optional thermoform acrylic glazing improves 17 performance. SunCache is sold as a kit, including all 18 plumbing and installation hardware, to lower installation 19 cost and ensure that all code requirements are met. 20 The SunCache system is expected to be 80 percent 21 as efficient as conventional solar water heaters but will 22 cost less than half as much, increasing the return on 23 every dollar invested in solar water heating. 24 Once commercial, this system is expected to cost 25 as little $1500 to install in new construction. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 49 1 The project will demonstrate 80 of these final 2 production spec SunCache systems in southern California in 3 preparation for formal market introduction. This will 4 work out any remaining production and reliability issues 5 and generate the confidence necessary for the investment 6 required for high volume production. 7 --o0o-- 8 GREENHOUSE GAS TECHNOLOGY & FIELD TESTING SECTION 9 MANAGER HERNER: The second application to whom we propose 10 funding is GEO2 Technologies. GEO2 has developed a 11 particulate filter using an advanced composite 12 alumina-silica material called mullite. 13 GEO2 is requesting funding of $185,000. The 14 total project costs would be $370,000. 15 The heart of the invocation is a high porosity 16 filter with greater uniformity in the filter pore size and 17 greater heat tolerance than traditional filter substrates. 18 The GEO2 filter would have greater PM storage 19 capacity and greater filter efficiency, especially during 20 and immediately after regeneration. This in turn would 21 reduce the frequency of DPF regeneration and commit the 22 use of filters on engines that normally might not be able 23 to use these due to operating conditions. 24 The filter would also have applications for small 25 off-road engines, engines which are currently not required PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 50 1 to use DPFs. 2 Once commercial, the filter is expected to be 3 priced in the medium range of currently available 4 substrate and have lower operating costs. 5 In the proposed ICAT project, the GEO2 mullite 6 filter would be install in five off-road heavy-duty diesel 7 engines using active regeneration systems, five off-road 8 heavy-duty diesel engines using passive regeneration 9 systems, and five small off-road engines such as hand-held 10 blowers or alternative terrain vehicles. 11 The vehicles using the GEO2 filters would be 12 operated for a period of six months, during which the 13 durability and emissions performance would be evaluated. 14 --o0o-- 15 GREENHOUSE GAS TECHNOLOGY & FIELD TESTING SECTION 16 MANAGER HERNER: The final grant to whom -- excuse me -- 17 the final application to whom we propose funding is Los 18 Gatos Research. Los Gatos Research is proposing to 19 demonstrate a high accuracy mobile emissions laboratory 20 that will be used to record realtime ambient measurements 21 of air pollutant and greenhouse gases. 22 Los Gatos Research is requesting approximately 23 $78,000 in funding. The total project costs would be 24 $257,614. 25 The mobile laboratory will use LASER-based PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 51 1 instruments that Los Gatos Research has developed and 2 patented. These instruments will be incorporated with 3 global positioning, ambient temperature, gas velocity 4 impression relative humidity monitors into a vehicle such 5 as a hybrid van. 6 Methane, CO CO2, nitrous oxide, NO2, and stable 7 isotopes of CO2, such as Carbon 12 and Carbon 13, would be 8 measured in realtime. 9 Los Gatos Research LASER-based instrument uses a 10 new cavity-enhance absorption-based approach called 11 off-axis cavity output spectroscopy, which permits gas 12 concentrations to be measured accurately and precisely in 13 a compact, robust, and inexpensive package. 14 In addition, the on-board instrumentation will be 15 autonomous, easy to use, and automatically store and 16 report data to a central station. 17 In the proposed ICAT project Los Gatos research 18 will quantify the ability of the mobile lab to record and 19 report measurements in realtime with high accuracy. In 20 addition, Los Gatos Research will work with the ARB 21 Research Division staff to determine the most important 22 urban and rural locations to monitor for extended studies. 23 The project would also support the ARB staff's 24 effort to develop a mobile monitoring platform. 25 --o0o-- PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 52 1 GREENHOUSE GAS TECHNOLOGY & FIELD TESTING SECTION 2 MANAGER HERNER: The ICAT project has been in place since 3 the early nineties and have funded many successful 4 technologies. This fiscal year we're proposing funding 5 three additional grants in the amount of $497,996, with a 6 total project cost of 1.1 million. These ARB funds will 7 assist the technologies to move past the so called Valley 8 of Death in the funding product cycle and on to 9 commercialization where they will fulfill their air 10 quality and economic potential for the state. 11 That concludes my presentation. Thank you for 12 your consideration. And I'd be happy to answer any 13 questions. 14 CHAIRPERSON NICHOLS: Thank you. 15 Could you just tell me roughly how much we have 16 to spend in this program annually? What's the available 17 funding from this program? 18 RESEARCH DIVISION CHIEF CROES: We typically 19 allocate a million dollars to the program each year, but 20 only if there's sufficiently noteworthy projects. 21 CHAIRPERSON NICHOLS: Interesting projects. And 22 it seems as though we get, you know, more than a handful, 23 but not the kind of huge numbers that I might have 24 expected given the difficulties in commercialization that 25 you've pointed out. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 53 1 RESEARCH DIVISION CHIEF CROES: Yeah, we actually 2 had some other promising projects that we were planning to 3 present, but then some of the partnerships fell through 4 and they didn't meet the co-funding requirements. 5 CHAIRPERSON NICHOLS: The co-funding is an 6 obstacle. 7 Ms. Kennard. 8 BOARD MEMBER KENNARD: Yes, I had a question. 9 I want to clarify that all these companies are 10 private companies. Is that correct? And that we're 11 actually providing what's equivalent to venture capital to 12 these companies for new technologies? 13 GREENHOUSE GAS TECHNOLOGY & FIELD TESTING SECTION 14 MANAGER HERNER: They all are private companies, yes. 15 BOARD MEMBER KENNARD: And so with that being 16 said, that once they develop these technologies and if 17 they're successful, they'll have a go-to-market strategy 18 and potentially be commercially viable. 19 So is there a mechanism whereby ARB gets some 20 kind of return on our investment or some participation if 21 these companies are wildly successful? And then we can 22 regenerate our funds for newer technologies. 23 AIR QUALITY FIELD STUDIES & ADMINISTRATION BRANCH 24 CHIEF FITZGIBBON: Hi. I'm Mike Fitzgibbon from Research. 25 I'd be happy to answer that. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 54 1 Typically in terms of profits, the grant money 2 that we're giving them is very small. And they're also 3 typically patented before they come to seek ICAT grants. 4 And unless we're exempted from the Legislature, we can't 5 accept royalties from these kind of grants. We don't have 6 an exemption. The California Energy Commission does have 7 an exemption, so they can require royalties from grants 8 like this. 9 BOARD MEMBER KENNARD: But aside from the royalty 10 issue and the patents, I mean there could be a mechanism 11 by which we get some kind of return on our investment or 12 the payback of the grant in total at some point when these 13 technologies become commercially viable. 14 AIR QUALITY FIELD STUDIES & ADMINISTRATION BRANCH 15 CHIEF FITZGIBBON: I mean we have considered that in the 16 past. But I think -- you know, we want to encourage these 17 companies to apply. And we consider our benefits to be 18 the early emission reductions that are achieved and the 19 health benefits that result from them. 20 BOARD MEMBER HILL: Madam Chair? 21 CHAIRPERSON NICHOLS: Yes. 22 BOARD MEMBER HILL: I would agree with Ms. 23 Kennard on this -- in looking at least for some potential 24 exemption in the future. It's a modest sum of money that 25 we're requesting -- or that they're requesting. However, PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 55 1 if we can return that money back to the fund at a later 2 date, then we can use it certainly for further and future 3 opportunities. So I think it might be something to look 4 at. 5 BOARD MEMBER BERG: I would just like to 6 piggyback, because what I'm hearing is that it would still 7 be a grant. But if in fact this technology is wildly 8 successful, and they have the ability, then why not 9 regenerate the fund to go out after other. So I'm not 10 hearing that we're going to look at the programs with the 11 ability of them to pay back; but rather than with a 12 criteria that if in fact they do a great job, then let's 13 get some of that money back so we can continue the 14 program. It would kind of be like their ability to give 15 back as well. 16 EXECUTIVE OFFICER GOLDSTENE: I think it's a good 17 idea. Let us explore it and we'll get back to you. 18 CHAIRPERSON NICHOLS: Could be a legislative 19 proposal. 20 EXECUTIVE OFFICER GOLDSTENE: Could be a 21 legislative proposal. 22 CHAIRPERSON NICHOLS: It's a really interesting 23 idea. Thank you. 24 BOARD MEMBER ROBERTS: Madam Chair? 25 CHAIRPERSON NICHOLS: Yes. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 56 1 BOARD MEMBER ROBERTS: Yeah, could you help me 2 understand. How do we get this word out? How do people 3 know of this program? And how many requests were there 4 for this money? 5 GREENHOUSE GAS TECHNOLOGY & FIELD TESTING SECTION 6 MANAGER HERNER: We have a solicitation that we send out 7 via Email. We have an Emailing list that people -- we 8 have a page on our website that people can look at. And 9 this year we did receive 62 pre-proposals. 10 BOARD MEMBER ROBERTS: I'm sorry. You have -- 11 you contact people or -- you're not being clear. 12 GREENHOUSE GAS TECHNOLOGY & FIELD TESTING SECTION 13 MANAGER HERNER: We have a web page where people can sign 14 up to get information for ICAT -- 15 BOARD MEMBER ROBERTS: Okay. So anybody that 16 logs on, if they think they -- 17 CHAIRPERSON NICHOLS: Getting a feedback in the 18 sound system here. I'm hearing -- picking up somebody's 19 conversation. I'm not quite sure how this is -- 20 EXECUTIVE OFFICER GOLDSTENE: It sounds like 21 they're behind here working on the screen, I think. 22 Laurie, can you find out. 23 BOARD MEMBER ROBERTS: Maybe we can have them 24 work quietly on the screen. 25 CHAIRPERSON NICHOLS: Yes. Could someone speak PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 57 1 to them. 2 BOARD MEMBER ROBERTS: Let me -- it's just that 3 I'm trying to better understand. So you have -- it's on a 4 web page. So if somebody discovers this, then -- and we 5 don't promote this in any way? 6 GREENHOUSE GAS TECHNOLOGY & FIELD TESTING SECTION 7 MANAGER HERNER: Anybody who's on the list serve will get 8 an Email for our solicitation -- 9 BOARD MEMBER ROBERTS: I'm sorry. Anybody that's 10 on what list? 11 GREENHOUSE GAS TECHNOLOGY & FIELD TESTING SECTION 12 MANAGER HERNER: Anybody who's on our list serve. You 13 sign up on the list on our web page. They will receive an 14 Email regarding the solicitation. 15 RESEARCH DIVISION CHIEF CROES: Actually we have 16 promoted this pretty extensively. So we've compiled 17 distribution lists from, you know, different small 18 business groups, from other agencies that run similar 19 types of programs. We've also done a general solicitation 20 to everyone that participates in ARB's and EPA's programs. 21 And then we have brochures that we do at some of these 22 technology forums. 23 BOARD MEMBER ROBERTS: How many submittals would 24 there have been in this group here then that -- how many 25 people didn't get selected? PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 58 1 GREENHOUSE GAS TECHNOLOGY & FIELD TESTING SECTION 2 MANAGER HERNER: Well, again, we received 62 3 pre-proposals. And then we whittled that down to three 4 that we're recommending for funding. 5 BOARD MEMBER ROBERTS: And one more that might 6 have worked. So there was 4 out of the 62? 7 GREENHOUSE GAS TECHNOLOGY & FIELD TESTING SECTION 8 MANAGER HERNER: Correct. 9 DEPUTY EXECUTIVE OFFICER SCHEIBLE: And there was 10 an intermediate process where we -- of the 62, we gave 11 feedback to 17 saying, "We think your concept could be 12 competitive if it works out." So 17 made more detailed 13 proposals. 14 So it was very easy to give us an idea. And then 15 we looked through those ideas. And the ones that we think 16 might have a chance, we signal back, you know -- "You 17 might want to do more work because you could be 18 competitive." Then out of the 17, we go through those and 19 say which ones actually pass our criteria for being, you 20 know, recommendable for funding. 21 CHAIRPERSON NICHOLS: Frankly, given the amount 22 of money that we keep reading is floating out there in the 23 venture capital world for clean technologies, I'm kind of 24 surprised that we're getting this much interest for, you 25 know, a million dollars total worth of allocations. I'm PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 59 1 happy that we're able to be of help, but it makes me 2 wonder kind of what's going on. 3 DEPUTY EXECUTIVE OFFICER SCHEIBLE: I think it's 4 the label. The fact that if you're in the business of 5 selling clean air technology and you have a technology 6 that was somehow, you know, supported by Air Resources 7 Board, that that's worth in many cases far more than the 8 amount of money that we put into it. 9 CHAIRPERSON NICHOLS: Right. 10 BOARD MEMBER ROBERTS: Let me ask you -- like in 11 the case of the water heater. This looks like kind of the 12 traditional solar system. What's really unique about 13 this? 14 GREENHOUSE GAS TECHNOLOGY & FIELD TESTING SECTION 15 MANAGER HERNER: What's unique about this system is really 16 the price. By moving away from using metals and this 17 polyethylene ethylene, they've been able to reduce the 18 price quite significantly. It also reduces the weight, 19 which allows people to install it themselves if they have 20 some capabilities, which would further reduce the cost of 21 installation. 22 So really by moving away from metals and into 23 these new types of plastics, they can reduce the cost 24 significantly. 25 Normal solar water heating systems typically will PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 60 1 cost on the order of $5,000 to $6,000 installed today. 2 And they're thinking they can move the price down very 3 quickly to 3,000 and possibly down to 2500 in the very 4 near future once they get production up and going. 5 BOARD MEMBER ROBERTS: Well, yeah, I wasn't 6 thinking of maybe the newer. I'm thinking of the very old 7 solar systems that this was very reminiscent. I mean this 8 looks like a retro system to me in a sense rather than 9 something -- there actually are systems like this in place 10 that -- not a plastic but with glass and metal frames in 11 San Diego that are operative. And that's why I'm sort of 12 curious as to what -- basically what you're saying, 13 there's some material innovation here that may make it 14 easy to do. I presume the weight's going to be more in 15 the water than in the materials. 16 GREENHOUSE GAS TECHNOLOGY & FIELD TESTING SECTION 17 MANAGER HERNER: I think you're correct in that. And as 18 far as I understand, there really aren't many other 19 options out there on the market for home buyers at this 20 time. They really just have the -- what I call the 21 traditional ones I guess, the heavier ones, the more 22 expensive ones. It's difficult to find low cost solar 23 water heaters at this time. 24 BOARD MEMBER ROBERTS: Okay. And we're putting 25 up like half the money. So is SDG&E putting up the other PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 61 1 half, or do we know? 2 GREENHOUSE GAS TECHNOLOGY & FIELD TESTING SECTION 3 MANAGER HERNER: Yes. The Los Gatos Research is putting 4 up some of the money and then San Diego/PG&E is putting up 5 some as well. They're partners. 6 BOARD MEMBER ROBERTS: Are they a part owner in 7 the company, or is this an independent company? 8 GREENHOUSE GAS TECHNOLOGY & FIELD TESTING SECTION 9 MANAGER HERNER: No, they're not. 10 CHAIRPERSON NICHOLS: Yes. 11 BOARD MEMBER HILL: Madam Chair, thank you. 12 BOARD MEMBER ROBERTS: They will if it works. 13 BOARD MEMBER HILL: And following up on 14 Supervisor Robert's question related to the polyethylene 15 or the substance that's used. If it's a plastic of some 16 kind -- and I know difference between the glazed metal is 17 that it can generate obviously and operate under a higher 18 temperature. And I guess the question would be, would 19 this allow that because of the type of material? 20 And, number 2, because of the UV deterioration 21 over time, what would be the payback? You know, generally 22 in that type of a system you could get maybe ten years, I 23 would think, at the most before the deterioration would be 24 a problem. 25 So I guess those are things that would be looked PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 62 1 at hopefully, and at the final analysis, to see if it is 2 cost effective even at a 2,000 or $3,000 price range. 3 GREENHOUSE GAS TECHNOLOGY & FIELD TESTING SECTION 4 MANAGER HERNER: Yes, as to the first question, they do 5 have both a glazed and a non-glazed option. What they're 6 finding is with -- in order to make it cheap, they've 7 allowed for certain types of piping to go between the 8 system and the actual water heater. And they can't 9 tolerate the types of temperatures that the water would 10 get to in, say, southern California if you had a glazed 11 system. So you would use unglazed in a very sunny area 12 and then add this glazing in more northern areas such as 13 northern California or Washington and whatnot. So that's 14 how they're going to use the glazing versus non-glazing. 15 The second question, that is one of the things 16 that they'll be looking at and, frankly, one of the things 17 they didn't discuss in detail in their proposal; but one 18 of the things we're looking forward to seeing, some 19 evaluation coming out of this project. 20 BOARD MEMBER HILL: All right. Thank you. 21 CHAIRPERSON NICHOLS: Very good. Turns out a lot 22 of people here know a lot about hot water heaters. 23 (Laughter.) 24 CHAIRPERSON NICHOLS: That may have come as a 25 surprise. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 63 1 Okay. Thank you. 2 So do I have a motion and a second to approve 3 these three resolutions? 4 BOARD MEMBER HILL: I'll move. 5 CHAIRPERSON NICHOLS: Moved. 6 BOARD MEMBER KENNARD: Second. 7 CHAIRPERSON NICHOLS: Seconded. 8 Yes, comment. 9 BOARD MEMBER SPERLING: Yes. You remember those 10 day jobs you talked about? 11 CHAIRPERSON NICHOLS: Yes. 12 BOARD MEMBER SPERLING: One of my day jobs is I'm 13 Acting Director of the Energy Efficiency Center at UC 14 Davis, which does have some connection with the Davis 15 Energy Group. And I truthfully don't even know exactly 16 what it is, but there is some connection. So I think it'd 17 be better if I recuse myself from that particular project. 18 CHAIRPERSON NICHOLS: I appreciate that. 19 BOARD MEMBER SPERLING: Although I look around 20 and see we might not have a quorum. 21 CHAIRPERSON NICHOLS: This is an interesting 22 question. 23 Well, we have a quorum present, right, with six 24 members? So with a quorum, if one member can't vote, 25 we're still okay. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 64 1 SENIOR STAFF COUNSEL JENNE: That's correct. 2 CHAIRPERSON NICHOLS: Thank you. 3 I guess I should ask the lawyer before I rule on 4 these things. 5 (Laughter.) 6 CHAIRPERSON NICHOLS: That was my recollection. 7 Thank you. 8 All right. So I think we're able to vote. 9 So we have a motion and a second. 10 All in favor please say aye. 11 (Ayes.) 12 CHAIRPERSON NICHOLS: Any opposed? 13 Motion carries. 14 And we will note that Dr. Sperling didn't vote. 15 All right. Moving on. We're making swift 16 progress. 17 All the mikes are off. 18 Oh, great. We'll all speak loudly then. 19 Do we know how long it will take to get them back 20 on? 21 Somebody's checking. 22 EXECUTIVE OFFICER GOLDSTENE: There we go. 23 Okay. We're all right. 24 CHAIRPERSON NICHOLS: We're back. Very good. 25 All right. We're moving on to Agenda item PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 65 1 08-1-5, Appointment of Replacement Members to the AB 32 2 Global Warming Environment Justice Advisory Committee, 3 otherwise known as the EJAC. 4 EXECUTIVE OFFICER GOLDSTENE: Thank you, Chairman 5 Nichols. 6 The Environmental Justice Advisory Committee was 7 formed by the Air Resources Board in January of 2007 to 8 advise the Board on the implementation of AB 32. The 9 California Global Warming Solutions Act of 2006. Today 10 we're asking the Board to consider the appointment of one 11 replacement member and three alternate members. 12 Johnnie Raymond from our Office of Climate Change 13 has a short presentation to describe the nomination 14 process and our recommended nominees. 15 Johnnie. 16 (Thereupon an overhead presentation was 17 Presented as follows.) 18 MR. RAYMOND: Thank you, Mr. Goldstene. 19 The Global Warming Solutions Act directed ARB to 20 form two advisory committees, an Environmental Justice 21 Advisory Committee, or EJAC, and an Economic and 22 Technology Advancement Advisory Committee, or ETAAC. 23 The Board formed these committees and appointed 24 their members in January of 2007. Both committees have 25 been working hard since then. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 66 1 EJAC has been busy meeting, providing 2 recommendations to ARB regarding the development of ARB's 3 early action measures to reduce greenhouse gas emissions 4 in California and has received briefings on the 5 development of the scoping. 6 The members appointed to EJAC by the Board were 7 chosen for their expertise in the areas important to this 8 task. 9 The EJAC member appointed to represent the San 10 Joaquin Valley and two alternates representing the Bay 11 Area recently resigned from their positions on EJAC. ARB 12 staff conducted a public solicitation to fill those 13 vacancies. Thirteen nominations were received, of which 14 seven met the established criteria outlined in the 15 statute. 16 Nominations were screened, reviewed, and 17 evaluated by staff based on experience and involvement 18 with environmental justice and community groups. We also 19 consulted with the EJAC Co-chairs. 20 Based on these evaluations, staff requests that 21 the Board approve replacements and recommends Caroline 22 Farrell move from alternate to fill the member vacancy. 23 In addition, staff recommends the appointments of Anna Yun 24 Lee, Luke Cole, and Betsy Reifsnider to fill alternate 25 vacancies. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 67 1 --o0o-- 2 MR. RAYMOND: The final slide shows the full 3 complement of proposed EJAC members. 4 And I would also like to note for the Board that 5 Ms. Betsy Reifsnider is here today with us in the 6 audience. 7 And if Betsy could stand up. 8 Thank you. 9 CHAIRPERSON NICHOLS: Okay. That's it. 10 Thank you very much. 11 Well, I am personally acquainted with a number of 12 the members who are up for us today, which doesn't cause 13 me to feel that I need to recuse myself. It just causes 14 me to express my gratitude that they are willing to serve. 15 It's a very fine group of individuals that have come 16 forward to participate in this process. And we really 17 appreciate their willingness to do this, because it's a 18 tough task and there's certainly no financial reward in 19 it. But it is an area where we understand the critical 20 importance in designing our AB 32 implementation programs 21 that they be of benefit to the people of the State of 22 California, in particular those who are the most 23 disadvantaged and who often receive the least benefit from 24 some of our programs. 25 So for that reason the fact that they have been PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 68 1 with us from the beginning and are now increasingly 2 ramping up their level of activity is very much 3 appreciated. 4 Are there any questions or comments from any of 5 the Board members? 6 If not, do we have a motion to approve? 7 BOARD MEMBER ROBERTS: Moved. 8 CHAIRPERSON NICHOLS: So moved. 9 And a second? 10 BOARD MEMBER HILL: Second. 11 CHAIRPERSON NICHOLS: All in favor please say 12 aye. 13 (Ayes.) 14 CHAIRPERSON NICHOLS: Good. Thank you very much. 15 Thank you coming today, Ms. Reifsnider. 16 Okay. Our next item is the Proposed Amendments 17 to the Diesel Emissions Control Strategy Verification 18 Procedure. 19 As everybody knows, controlling emissions from 20 diesels engines has been one of ARB's top priorities 21 because of their significant impact on air quality and 22 public health. In 1998, diesel particulate matter was 23 identified by this Board as a toxic air contaminant as 24 well. 25 The Diesel Risk Reduction Plan adopted by the PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 69 1 Board in 2000 established a goal of reducing diesel 2 particulate matter emissions 75 percent by 2010 and 85 3 percent by 2020. Meeting this goal has required not only 4 stringent emission standards for new engines, but also 5 significant reductions in emissions from diesel engines 6 that are already in use. 7 To effectively implement ARB's aggressive 8 emissions control program for existing engines, a 9 procedure was needed for verifying the control strategies 10 are durable and provide the purported emissions benefits. 11 Staff therefore developed a verification procedure that 12 manufacturers must follow if they wish to participate in 13 the California diesel emissions control market. The 14 verification procedure was adopted by this Board in May 15 2002. 16 The proposal before us today describes a number 17 of amendments to this procedure. They are detailed and 18 complicated. But I know our staff is going to do a good 19 job of walking us through it and helping us to understand 20 the implications. 21 Mr. Goldstene, you want to introduce the item. 22 EXECUTIVE OFFICER GOLDSTENE: Thank you, Chairman 23 Nichols. 24 The verification procedure's used by staff to 25 verify that emission control technologies achieve real and PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 70 1 durable reductions in emissions of diesel particulate 2 matter and oxides of nitrogen. The verification procedure 3 is the foundation that supports ARB's numerous in-use 4 diesel emission control regulations. 5 Since 2002 staff has verified a variety of diesel 6 particulate filters, flow-through filters, diesel 7 oxidation catalysts, as well as systems that can also 8 achieve NOx reductions. These verified system have been 9 widely applied in a number of applications throughout the 10 State. 11 (Thereupon an overhead presentation was 12 Presented as follows.) 13 EXECUTIVE OFFICER GOLDSTENE: In implementing the 14 verification procedure, staff has determined that the 15 procedure could be improved, and therefore is proposing a 16 number of amendments. The proposed amendments offer an 17 opportunity to expedite the verification process for 18 applicants with ARB-verified technologies through 19 conditional extensions. The proposed amendments will 20 improve the robustness of the verification procedure by 21 modify the testing requirements to more closely represent 22 real-world operations, allow staff to better evaluate the 23 functionality of control technologies, and expand and 24 refine the evaluation of NOx emission control 25 technologies. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 71 1 In addition, staff's proposal includes 2 clarifications of current requirements to help applicants 3 during the verification process. 4 I'd like to turn the presentation over to 5 Danielle Robinson of the Mobile Source Control Division, 6 who will provide you with an overview of staff's proposal 7 and recommendations. 8 Danielle. 9 AIR RESOURCES ENGINEER ROBINSON: Thank you. 10 Good morning, Chairman Nichols and members of the 11 Board. 12 Today I will present staff's proposed amendments 13 to the verification procedure for diesel emission control 14 strategies, commonly referred to as diesel retrofits. 15 The verification program is the ARB's core 16 program to evaluate the effectiveness and durability of 17 diesel retrofit technologies. As such, it is the 18 foundation on which California's diesel retrofit fleet 19 rules are built. 20 --o0o-- 21 AIR RESOURCES ENGINEER ROBINSON: I will begin my 22 presentation today by first providing background on the 23 role the verification program plays in supporting ARB's 24 various current and future fleet rules. I will then give 25 an overview of what the verification program is and how PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 72 1 ARB staff utilize it to evaluate diesel retrofit 2 technologies. 3 Next I will discuss staff's proposed amendments, 4 including the impacts of staff's proposal and the outreach 5 staff conducted in developing the proposed amendments. 6 I will then conclude with staff's recommendation. 7 --o0o-- 8 AIR RESOURCES ENGINEER ROBINSON: First let me 9 begin with some background about how the verification 10 program came into being and the role it plays in 11 supporting ARB's various diesel fleet rules. 12 --o0o-- 13 AIR RESOURCES ENGINEER ROBINSON: In 1998, this 14 Board identified diesel particulate matter, or diesel PM, 15 as a toxic air contaminant. In response to this, the 16 Board approved the Diesel Risk Reduction Plan in 2000. 17 The diesel risk reduction plan is a comprehensive 18 strategy intended to eventually reduce the overall risk of 19 the public's exposure to diesel PM by 85 percent by 2020. 20 The plan calls for reducing PM emissions from almost all 21 new and existing diesel engines and, in particular, calls 22 for the retrofit of existing diesel engines in almost 23 every type of application. 24 --o0o-- 25 AIR RESOURCES ENGINEER ROBINSON: Since the PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 73 1 Diesel Risk Reduction Plan was approved, this Board has 2 adopted over a dozen regulations covering all types of 3 diesel engines operating in the state. And more are under 4 development. 5 By 2009 it is staff's goal to have brought to the 6 Board measures that effectively cover every diesel engine 7 operating in the state. From the first rule in 2000 8 targeting diesel buses, to the most recent regulations 9 adopted in 2007 covering off-road vehicles and port 10 trucks, the Board has consistently approved regulations 11 which, among other things, call for fleet operators to 12 install the most effective diesel PM retrofit devices 13 available. 14 --o0o-- 15 AIR RESOURCES ENGINEER ROBINSON: To support the 16 aggressive goals of the Diesel Risk Reduction Plan and the 17 retrofit requirements of the numerous diesel fleet rules 18 approved by the Board, a rigorous program to evaluate the 19 effectiveness of diesel retrofit technology is necessary. 20 The success of the diesel fleet rules is 21 dependent on a wide variety of effective retrofit 22 solutions being available to fleet operators. To be 23 effective, retrofit devices must be durable and provide 24 real mission reductions. To evaluate retrofit devices, 25 robust emission testing and durability demonstrations must PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 74 1 be performed to ensure a device will provide the 2 anticipated emission reductions claimed and that it will 3 hold up to the rigors of real-world use, not just when a 4 device is first installed but for years to come. 5 The ARB's verification program is the tool ARB 6 staff utilizes to perform this evaluation. 7 --o0o-- 8 AIR RESOURCES ENGINEER ROBINSON: I will now 9 provide an overview of ARB's verification program, 10 including the steps staff takes in evaluating and 11 verifying a diesel retrofit technology. 12 --o0o-- 13 AIR RESOURCES ENGINEER ROBINSON: To support the 14 various fleet rules retrofit requirements, the Board 15 approved the verification procedure in May 2002. Because 16 retrofit technology is constantly evolving, and staff 17 continues to gather experience dealing with retrofit 18 technologies and how they are applied in the real world, 19 the verification program needed to evolve as well. To 20 address this, the Board has amended the program a number 21 of times. However, throughout its existence the 22 verification program has maintained several key 23 fundamental principals. These include: 24 Thorough emission testing and durability 25 demonstrations to ensure the anticipated emission PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 75 1 reductions are realized; 2 Technology evaluations based on sound principles 3 of science and engineering; 4 Strong warranty protections to end users; and 5 Assurance that retrofit technologies do not 6 increase emissions of other pollutants. 7 --o0o-- 8 AIR RESOURCES ENGINEER ROBINSON: To determine 9 the effectiveness and durability of a retrofit system, an 10 adequate demonstration of these principles must be 11 performed. The procedure requires robust emissions, 12 durability, and field testing before a verification can be 13 issued. This is intended to assure that a given device 14 works as specified and is compatible with the proposed 15 applications. When performing emission testing, the 16 procedure requires that both a new and an aged device be 17 tested. This ensures that the emission reductions of the 18 device can be assured over time. 19 The procedure also has very prescriptive 20 durability testing requirements, which vary based on the 21 type of application for which a device is being verified. 22 This is important in demonstrating how the device will 23 perform and hold up over time. 24 Off-road and stationary applications must 25 demonstrate a minimum of 1,000 hours of durable service PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 76 1 before a device can be verified. Whereas on-road 2 applications have the alternative to demonstrate 50,000 3 miles of durable service. 4 These high benchmarks for durability have been 5 set, because if a device fails to perform over its 6 lifetime, the estimated benefits of the fleet rules will 7 be compromised. 8 In addition, after a verification is rewarded, 9 in-use compliance testing must be completed to maintain 10 the verification status. In-use compliance testing is 11 critical to evaluate the long-term effectiveness of 12 retrofit systems well after the initial verification 13 testing, and is triggered after a certain number of 14 devices have been sold in California. 15 --o0o-- 16 AIR RESOURCES ENGINEER ROBINSON: Currently the 17 verification program is focused on PM reductions. In 18 assigning a verification, the program recognizes one of 19 three levels: 20 The first, Level 1, is for devices that achieve 21 at least a 25 percent reduction in diesel PM and are 22 typified by devices such as diesel oxidation catalysts. 23 The next level, Level 2, provides even more PM 24 reductions of at least 50 percent. Typical Level 2 25 devices include flow-through filters. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 77 1 The highest level PM reductions are reserved for 2 Level 3 devices, which achieve greater than an 85 percent 3 reduction in diesel PM. Currently, only one type of 4 device, a diesel particulate filter, can achieve this 5 level of control. 6 While not a primary focus of the verification 7 program, the procedure provides for the concurrent 8 recognition of optional NOx reductions as well. Currently 9 the procedure recognizes NOx reductions starting at 15 10 percent, and higher levels are verified in 5 percent 11 increments. 12 It is important to note that the procedure 13 requires that any NOx reductions be accompanied by PM 14 reductions as well. That is, the procedure currently does 15 not provide for the verification of NOx-only systems. 16 For reasons that will be discussed later, staff 17 is proposing changes to both how NOx reductions are 18 classified as well as how systems that achieve only NOx 19 reductions are handled. 20 --o0o-- 21 AIR RESOURCES ENGINEER ROBINSON: NOx reductions 22 should not be confused with nitrogen dioxide, or NO2 23 production. Some types of retrofit systems utilize NO2 to 24 produce -- to reduce PM emissions. This is because NO2 is 25 more effective than oxygen in oxidizing collected soot in PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 78 1 diesel particulate filters. 2 While every diesel engine produces some NO2 3 during the combustion process, it is typically only a 4 small fraction of the total NOx emitted by the engine. 5 Therefore, devices that utilize NO2 to oxidize soot 6 typically have catalysts in them that generate NO2 over 7 the filter. This is an issue due to the adverse health 8 effects of NO2 emissions for which the state has 9 established ambient air quality control standards. To 10 address this, the procedure provides for a limit of no 11 more than a 30 percent increase in NO2 emissions as of 12 January 1st, 2007, and no more than a 20 percent increase 13 in NO2 emissions beginning in 2009. 14 Devices meeting the 2009 standard before the 15 deadline are designated as plus systems. Devices that do 16 not meet these standards become deverified as of these 17 effective dates. 18 --o0o-- 19 AIR RESOURCES ENGINEER ROBINSON: Because ARB's 20 fleet rules require the installation of verified diesel 21 retrofit devices, the Board included specific warranty 22 provisions intended to protect end users. 23 As you will hear later, the warranty provisions 24 in the procedure are one of the key differences between 25 the ARB's verification program and similar programs in PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 79 1 other areas of the world. These warranty provisions 2 protect the end user by requiring the device manufacturer 3 to warrant their product to be free of defects. 4 The warranty protection not only covers defects 5 of the device but also extends to cover damage to the 6 engine that might be caused by the device. 7 In addition, the installation of the device is 8 similarly covered. The warranty is intended to cover the 9 majority of the device's useful life, and varies depending 10 on the application and size of the engine, but can extend 11 to as long as five years for both on-road and off-road 12 applications. 13 --o0o-- 14 AIR RESOURCES ENGINEER ROBINSON: Because the 15 verification program is quite involved, the process can 16 take some time to complete. To apply for verification an 17 applicant must provide a pre-application, which includes 18 basic information about the strategy, a description of its 19 operating principles and how the applicant will meet the 20 procedure's requirements. 21 Staff then works closely with the applicant to 22 determine the applicability of the control strategy. This 23 includes evaluating on which engines the control strategy 24 will work and is typically spelled out in the 25 verification. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 80 1 After staff receives a complete application that 2 meets the procedure's requirements, the verification can 3 be issued. To maintain a product's verification status, 4 applicants must meet the warranty and in-use compliance 5 requirements. This robust and thorough evaluation process 6 is necessary to ensure that a control strategy is 7 appropriate for the intended application. 8 The verification process can take 12 to 18 9 months, with the process being heavily impacted by the 10 ongoing development of the control strategy, changes to 11 the control strategy or testing protocol, testing 12 failures, and any deviations from the requirements of the 13 procedure. 14 However, these numbers are conservative, and 15 verification can be a much shorter process provided the 16 information submitted is complete, applicable and robust. 17 Because emission testing can be expensive and 18 time consuming, the verification program is intended to 19 provide substantial flexibility to applicants. While this 20 can provide some economic benefit to applicants through 21 decreased verification costs, there is a trade-off in that 22 it can often result in more review time, as the data are 23 all not always standardized and uniform. 24 --o0o-- 25 AIR RESOURCES ENGINEER ROBINSON: The need to PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 81 1 evaluate the effectiveness of retrofit technologies is not 2 unique to California. In other parts of the world there 3 are similar verification programs based on many of the 4 same principles as the ARB program, but with some 5 significant differences. 6 The U.S. EPA has an established verification 7 program modeled after the ARB program. However, it does 8 not provide similar warranty protections and currently 9 does not have prescribed health protective NO2 emissions 10 limits. 11 Also, the U.S. EPA does not look at fuel-based 12 strategies from a multimedia perspective, as is done with 13 the ARB program. In Europe the Swiss VERT program 14 predates ARB's verification program. However, it does not 15 verify NOx control strategies, and verifications issued by 16 VERT are based upon particle numbers, sizing, and 17 elemental carbon mass concentrations, not total reductions 18 in diesel PM mass as is done in the U.S. 19 Like the U.S. EPA, the VERT program also does not 20 consider the multimedia impacts of fuel-based strategies. 21 All in all, staff believes that the ARB program 22 is the most robust, most comprehensive program anywhere in 23 the world that evaluates the effectiveness and durability 24 of diesel retrofit technologies. 25 --o0o-- PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 82 1 AIR RESOURCES ENGINEER ROBINSON: To date, over 2 40 devices have been verified by ARB. These devices cover 3 a wide range of applications an include two new passive 4 diesel particulate filters that have recently been 5 verified for certain off-road applications. These devices 6 include a range of technologies, from various types of 7 diesel particulate filters to systems that can achieve 8 substantial NOx reductions. 9 In addition, there's some flexibility in the 10 types of diesel fuel that these technologies can use, as 11 most of these technologies are also compatible with blends 12 of up to 20 percent biodiesel. 13 Since the inception of the ARB's verification 14 program, over 8,000 retrofits have been installed on 15 everything from buses and construction equipment to 16 on-road trucks and the agricultural irrigation pumps. 17 Over the next few years several hundred thousand 18 additional retrofit installations will be needed to meet 19 the requirements of the fleet rules that have recently 20 been approved by the Board or will be proposed in the near 21 future. 22 The success of the verification program is 23 building and more technologies are currently being 24 evaluated, likely leading to an even greater diversity of 25 verified products being available for fleets to meet PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 83 1 California's aggressive retrofit requirements. 2 --o0o-- 3 AIR RESOURCES ENGINEER ROBINSON: Staff is 4 participating in a number of ongoing activities designed 5 to expedite the verification of additional retrofit 6 technologies. One important program is the off-road 7 showchase. 8 In this $4.9 million program, the durability and 9 effectiveness of 29 different types of retrofit systems, 10 including both PM and NOx PM control technologies, are 11 being evaluated. By later this spring, 245 vehicles will 12 have been retrofit. Verification Program staff is also 13 working closely with the U.S. EPA on a similar program. 14 In addition, staff also works very closely with 15 the Verification staff of the U.S. EPA to ensure as much 16 consistency as possible between the two programs. 17 --o0o-- 18 AIR RESOURCES ENGINEER ROBINSON: I will now 19 present staff's proposed changes to the verification 20 procedure. 21 --o0o-- 22 AIR RESOURCES ENGINEER ROBINSON: Based on our 23 experience in implementing the fleet rules and the 24 Verification Program, staff has determined that a number 25 of important changes to the procedure are needed. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 84 1 First, staff is proposing changes that would 2 facilitate the market availability of retrofit systems by 3 providing an easier extension of retrofits to additional 4 engines, reducing some testing requirements and providing 5 for the verification of NOx-only systems. 6 Staff is also proposing changes that would allow 7 the procedure to better reflect real-world experiences, 8 including a transition to a new transient test cycle for 9 off-road applications, increased flexibility in allowable 10 test fuels, and requirements that devices be designed to 11 be installed in only one direction, as well as other minor 12 changes and clarifications. These changes are critical to 13 the continued success of the Verification Program and will 14 allow for the procedure to better maintain the standard of 15 excellence necessary to appropriately assess the 16 real-world performance of retrofit devices. 17 I'll now briefly describe each of the key 18 proposed changes. 19 --o0o-- 20 AIR RESOURCES ENGINEER ROBINSON: Currently 21 manufacturers that have verified devices for off-road 22 engines have to start out from scratch if they wish to 23 extend their verification to similar on-road engines. 24 Staff believes the durability data gathered during an 25 off-road verification gives increased confidence that the PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 85 1 device will also perform well in an on-road truck. 2 To shorten the on-road verification process, 3 staff is proposing a conditional extension that may be 4 issued before the on-road demonstration is complete. This 5 will help get the device into the market sooner and 6 increase the retrofit choices for end users. 7 --o0o-- 8 AIR RESOURCES ENGINEER ROBINSON: Staff is also 9 proposing changes intended to reduce certain testing 10 requirements that are difficult for device manufacturers 11 to comply with. This is particularly true of the 12 requirement for testing for high levels of NOx that can be 13 generated by highway trucks traveling at freeway speeds. 14 This test is extremely challenging, and the 15 information provided by this testing is not particularly 16 critical today since most vehicles in California have 17 participated in the low NOx software upgrade program, 18 commonly referred to as the chip reflash program. 19 By removing the requirement that this testing be 20 performed, staff believes that testing costs and time 21 needed for applicant's to complete the verification 22 process will be reduced. 23 --o0o-- 24 AIR RESOURCES ENGINEER ROBINSON: Currently the 25 procedure requires that a device must achieve PM PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 86 1 reductions in order to be considered for verification. 2 Thus, systems which only achieve NOx reductions cannot 3 currently be verified. Because of the continuing need for 4 significant NOx reductions from existing diesel engines, 5 staff is proposing to allow in certain instances the 6 verification of NOx-only devices. 7 --o0o-- 8 AIR RESOURCES ENGINEER ROBINSON: As the 9 Verification Program has matured, we have gained 10 additional experience in evaluating the real-world 11 operation of verified retrofit devices. Based on this, 12 staff is proposing a number of changes to the procedure 13 which will better reflect what these devices perform. 14 The first change being proposed addresses the 15 fact that the current test cycle for off-road applications 16 a steady state and, as such, is too simplistic to simulate 17 the emissions performance seen with real-world 18 applications, which are much more transient in nature. 19 This results in emission testing that typically 20 overestimates potential NOx reductions and underestimates 21 expected increases in the NO2 production. 22 To address this, staff proposes to require the 23 use of the non-road composite transient cycle, a 24 representative transient cycle developed by the U.S. EPA 25 to support off-road certification testing. This is the PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 87 1 test cycle that is required by both ARB and U.S. EPA for 2 certification of new Tier 4 off-road engines. 3 --o0o-- 4 AIR RESOURCES ENGINEER ROBINSON: Along these 5 same lines, staff has found that some potential 6 verification applications, particularly marine 7 applications, do not use fuel compliant with California's 8 reformulated diesel regulations, commonly known as CARB 9 diesel fuel. However, the procedure requires the use of 10 CARB diesel fuel for verification testing. This means 11 that these devices would be verified on a fuel that they 12 will never be used in the real world. To address this, 13 staff is proposing to allow for verification test fuels 14 that are representative of the fuel that a retrofit device 15 will see in practice. This will provide for much more 16 representative and accurate testing for these applications 17 and provide staff with more flexibility in accepting test 18 data generated using fuels other than CARB diesel fuel. 19 --o0o-- 20 AIR RESOURCES ENGINEER ROBINSON: Recently it has 21 come to staff's attention that fleets may be intentionally 22 or unintentionally reinstalling diesel particulate filters 23 backwards from their original orientation. This can have 24 a number of adverse effects, including the potential for 25 the device to malfunction or fail prematurely, and can PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 88 1 release toxic and/or hazardous waste ash from the filter, 2 posing a potentially significant health risk to those 3 exposed. This practice can also affect a device's 4 warranty status, resulting in an end user having a broken 5 system with potentially no recourse. 6 To alleviate this issue, staff is proposing 7 requirements that all newly verified after-treatment 8 systems be designed such that they can only be installed 9 in one direction. This requirement is consistent with the 10 policy of the European VERT Verification Program. We 11 believe that this change will prevent any user misuse and 12 maintain the emissions reduction integrity of verified 13 systems. 14 --o0o-- 15 AIR RESOURCES ENGINEER ROBINSON: Staff is also 16 proposing other changes and minor clarifications that will 17 increase the robustness of the program and facilitate the 18 procedure's ability to support the in-use fleet rules. 19 These changes include: 20 Revise NOx classifications that complement the 21 performance of NOx control technology; 22 Explicit in-use compliance and recordkeeping 23 requirements; 24 Expanded durability requirements for NOx control 25 systems that ensure their proper performance in the field; PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 89 1 New requirements for the proof of sales in 2 California; 3 More specific system labeling requirements; and 4 Clearer sales and installation requirements. 5 --o0o-- 6 AIR RESOURCES ENGINEER ROBINSON: Since the 7 release of the staff report and proposed regulatory 8 language, staff has received a number of comments from 9 manufacturers regarding the proposal for a 10 uni-directionality requirement and on the provisions 11 clarifying the ability of end users to install used 12 devices on different vehicles. 13 Because staff is continuing to work with 14 stakeholders to address their concerns, specific revised 15 regulatory language on these proposals has not yet been 16 developed. However, staff has developed a document 17 discussing these potential changes that is included as 18 Attachment B to the resolution before the Board, and is 19 available on the table outside the hearing room. 20 Staff proposes that the Board direct them to 21 continue to work with stakeholders to develop an 22 appropriate phase-in schedule for transitioning to 23 uni-directional flow devices and to clarify the provisions 24 regarding the installation of the used control systems. 25 --o0o-- PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 90 1 AIR RESOURCES ENGINEER ROBINSON: I will now 2 briefly discuss the impacts of the proposed amendments and 3 the outreach staff performed in developing these 4 amendments. 5 --o0o-- 6 AIR RESOURCES ENGINEER ROBINSON: The proposed 7 amendments are primarily intended to maintain the robust 8 nature of the procedure and ensure that the emissions 9 reductions are real and the devices are durable. Other 10 changes are simply clarifying in nature or increasing the 11 flexibility open to the device manufacturers. Thus, the 12 proposed amendments will result in an unquantifiable but 13 positive environmental benefit. 14 Some of the amendments, such as the use of the 15 new transient cycle, could increase the cost of 16 verification to some manufacturers that utilize facilities 17 that need to be upgraded. While other amendments, such as 18 the removal of currently required testing, should decrease 19 testing costs. 20 On balance, staff does not expect these cost 21 impacts to be significant relative to the overall cost of 22 verifying a retrofit system. 23 Overall, staff does not expect the proposed 24 amendments to cause a significant economic impact on the 25 state or on businesses and fleets. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 91 1 --o0o-- 2 AIR RESOURCES ENGINEER ROBINSON: During the 3 course of drafting the proposed amendments, staff held 4 four public workshops in Los Angeles, El Monte, and 5 Sacramento. 6 Staff also met with MECA and its individual 7 member companies. Staff considered comments brought forth 8 by MECA and individual companies, and incorporated 9 appropriate comments into the proposed amendments. 10 --o0o-- 11 AIR RESOURCES ENGINEER ROBINSON: Staff 12 recommends that the Board approve the proposed amendments 13 as presented to you today. 14 In addition, staff recommends that the Board 15 direct staff to continue to work with stakeholders to 16 address additional necessary clarifications to staff's 17 proposal. 18 This concludes my presentation. And thank you. 19 CHAIRPERSON NICHOLS: Thank you, Ms. Robinson. 20 Are there any immediate questions by the Board 21 before we hear from the audience? 22 You've already described the public participation 23 process, which sounds quite extensive. But does the 24 ombudsman have any additional comments that she wishes to 25 make? PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 92 1 OMBUDSMAN QUETIN: I could share with you the 2 number of people that attended those workshops. 3 CHAIRPERSON NICHOLS: Okay. 4 OMBUDSMAN QUETIN: Basically about 25 people 5 attended each of those workshops. And I would just add 6 that they Emailed the staff report to 5800 people that 7 were on the list serves and they posted on a web page, and 8 over 2,000 hard copies were mailed out. 9 And so that would be all I could add. 10 CHAIRPERSON NICHOLS: Well, thank you. We 11 appreciate that addition. 12 We have five witnesses who've signed up to 13 testify. And I can't say I'm disappointed that none of 14 them have signed up to oppose it. I'm delighted. But I'm 15 always a little surprised when that happens. 16 So in any event, I'm looking forward to hearing 17 from all of you. 18 The first witness is Rasto Brezny from MECA. 19 DR. BREZNY: Thank you, Chair Nichols and members 20 of the Board. It's my pleasure to kick off this 21 discussion. My name is Dr. Rasto Brezny, and I'm the 22 Deputy Director for the Manufacturers Emission Controls 23 Association. 24 MECA's pleased to provide testimony in support of 25 the proposed amendments. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 93 1 MECA is a nonprofit association made up of the 2 leading manufacturers of emission control technology for 3 motor vehicles. Our members are responsible for most of 4 the verified PM control devices that are available today. 5 And they're actively pursuing verifications for the next 6 generation of PM plus NOx technologies. 7 Although we in general support the proposal, I'd 8 like to make a few comments which we've detailed in our 9 written testimony. 10 First of all, we feel that the additional 11 requirements of reengineering the design of devices to 12 allow only one installation direction will add significant 13 costs, it will tie up resources of both ARB as well as the 14 manufacturers, and therefore delay new verifications. 15 We believe that there is other means by which to 16 address these requirements, and we commit to working with 17 ARB staff to develop a mutually agreeable solution. 18 Furthermore, the proposal does require 19 manufacturers to obtain executive officer approval if they 20 allow device swapping between vehicles. 21 Now, we ask further clarification how this device 22 swapping will impact device warranties and also further 23 requirements on vehicle owners to obtain permission from 24 manufacturers before swapping devices. 25 We recognize the need for proper labeling and PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 94 1 recordkeeping of devices that are out in the field. We 2 are concerned, however, that the proposal does not 3 adequately prevent abuse of the labeling system and, thus, 4 making enforcement more difficult. We want to continue to 5 work with staff to develop a labeling system that will 6 address these issues. 7 And last, but not least, we ask that the Board 8 commit additional qualified resources to the Verification 9 Program as quickly as possible in order to handle the 10 increasing complexity of devices to deliver both PM and 11 NOx reductions. And also ARB must be able to handle more 12 than one verification from a manufacturer at a time in 13 order to meet the emission targets and deadlines from 14 existing regulations. 15 And, finally, I want to thank ARB staff for its 16 hard work and bringing you this proposal. And we pledge 17 our commitment to continue to work with staff in order to 18 improve the verification requirements. 19 Thank you very much. 20 CHAIRPERSON NICHOLS: Thank you very much. And 21 thanks for the role that your association plays in this 22 program. We appreciate it. 23 Julian Imes -- I hope I'm not butchering your 24 name -- from Donaldson, followed by Donel Olson and then 25 Kevin Brown. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 95 1 MR. IMES: Good morning, Chairman Nichols and 2 members of the Board. My name is Julian Imes and I'm 3 Director of Advanced Technology and Government Affairs for 4 Donaldson Company, Incorporated. 5 And we are pleased to present testimony in 6 support of ARB's proposed amendments to the verification 7 procedure. 8 We're headquartered in Minneapolis, Minnesota, 9 and we provide filtration system and replacement parts. 10 We're also a member of MECA, and we do have verified 11 technologies both with EPA's Retrofit Program and with 12 ARB's Diesel Risk Reduction Program. 13 We again support overall MECA comments that have 14 been provided. But we do have some additional clarifying 15 comments that we wish to make. And these comments center 16 on the need and benefit specifically of crankcase emission 17 control for in-use or legacy diesel engines in California. 18 Specifically again, we do have existing EPA and 19 ARB verifications using retrofit crankcase PM control 20 which is combined with various tailpipe PM control 21 technologies. Our brand name for this technology is 22 Spherical. 23 While in the past there has been allowances of 24 verification of total PM, which includes crankcase and 25 tailpipe PM control, these new and existing proposed PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 96 1 amendments do not specifically address or recognize the 2 emission reduction benefits of crankcase PM control. 3 Donaldson is concerned that without appropriate 4 verification process guidelines that future verifications 5 and retrofit of crankcase PM controls on in-use engines 6 will be very limited in California. 7 Given this uncertainty, we request that ARB 8 develop guidelines for verifying crankcase PM controls, as 9 VDECS, or verified diesel emission control strategies, 10 either alone or in combination with tailpipe PM devices. 11 This would ensure a recognized process for effectively 12 reducing total PM emissions, tailpipe and crankcase, and 13 allow effective future utilization in California. 14 Some of these benefits for controlling crankcase 15 PM were well summarized in MECA's written testimony, but I 16 would like to just add some additional comments. 17 There's three primary reasons why is this 18 important as you're listening to me: 19 Number 1, for existing legacy or in-use diesel 20 engines there exist sizable crankcase PM emissions, .01 to 21 .04 grams brake horsepower per hour, or an average .025, 22 as compared to a controlled engine of a Level 3 PM control 23 of less than .01. So consider .025 as compared to .01. 24 We think that that's important. 25 Number 2, there has been multiple third-party PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 97 1 studies on the dramatic improvement impact of crankcase PM 2 control on in-cabin school buses when it's combined with a 3 Level 3 tailpipe PM control. It doesn't -- you get a much 4 increased benefit when you improve the in-cabin air of a 5 school bus with crankcase control when it's added to 6 tailpipe. 7 And, number 3, the EPA certainly recognized this 8 issue for 2000 on-road first-fit regulations and 2011 9 non-road rules, which require that crankcase emissions be 10 accounted for as part of the overall emission level that 11 they must meet. 12 So if it's important for new engines, we believe 13 that when you're going to control to a level of .01 on 14 legacy engines, you ought to also consider crankcase 15 emissions. 16 Okay. So, in summary, there are multiple 17 suppliers of crankcase emission controls that can capture 18 more than 95 percent, whether they're closed loop or open 19 loop, and Donaldson would like to join with MECA in 20 working with ARB to develop guidelines for bringing these 21 crankcase PM control technologies into the verification 22 and be appropriately recognized. 23 That concludes my presentation. Thank you for 24 your attention. And I welcome any questions you might 25 have. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 98 1 CHAIRPERSON NICHOLS: Questions? 2 Thank you very much. We may have questions later 3 after we've heard all the testimony. 4 Mr. Olson, followed by Kevin Brown and Tom 5 Swenson. 6 MR. OLSON: Madam Chairman, ladies and gentlemen 7 of the Board. Good morning. I'm Don Olson and our 8 company is an independent testing laboratory in California 9 that does a significant amount of testing for clients that 10 are accommodating your procedures. So we have some 11 comments to make on a narrow scope of your changes, and 12 that's related to the non-road testing changes that are 13 implied for transient testing. 14 Our clients -- several of our clients are 15 concerned about the differences that exist when tested by 16 the NRTC versus testing by the now conventional 8-mode 17 test protocol, steady state test protocol, 13-mode test 18 protocol and so on. Our laboratory has this capability to 19 measure NRTC results in our transient test cell and of 20 course steady state test results. And we've been doing 21 some comparative testing for various clients of this 22 difference that exists between the NRTC results and the 23 steady state results. And they contend that those 24 differences will be quite difficult to overcome in terms 25 of current design. And so they're looking to do PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 99 1 significant new design to accommodate the transient cycle 2 test cell with their transient cycle test. 3 We've seen differences in comparative testing 4 between the 8-mode test protocols with new engines and 5 with older engines, but primarily with new engines, 6 compared to the 8-mode test protocol of 30 to 40 percent 7 difference in emissions of PM, for example. A very 8 significant difference. And of course this goes to the 9 question of what's standards would they be attempting to 10 satisfy because these are not small differences. 11 We caution that -- of course I'm in the testing 12 business, so I like this testing incident. That's okay. 13 But we caution for our clients that they need 14 clarification to some extent on this issue and perhaps 15 more independent testing than you've done. There isn't 16 much record of any significant independent testing 17 recently accomplished. We know that EPA did this work 18 with MECA and other bodies some years ago and measured 19 emissions at Southwest Research Institute extensively. 20 Things are a little different now. It's a later time and 21 new control systems. 22 So I just bring this to your attention that it's 23 a concern that the staff should really address, because 24 this can be quite different. 25 I can share with the staff -- we work with the PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 100 1 staff all the time, because we're testing for clients that 2 are trying to get verified with CARB. But we can share 3 that some of this information may be not the clients that 4 are doing this testing in our lab, but we can share the 5 differences that exist both with the steady state 6 condition and with the FTP transient condition for on-road 7 vehicles. As you know, that's a transient test cycle also 8 for on-road vehicles and we're doing that all the time in 9 our laboratory in California. But there's difference of 10 course with that. But that's an on-road protocol. 11 And the off-road protocol presently is 8-mode 12 testing. And designers that have to test devices -- 13 design devices for this test protocol frankly are somewhat 14 concerned. So I bring that to your attention and just -- 15 it's what I'm focusing on. 16 Frankly, the other changes you've made are -- and 17 I'm not saying this is a bad change. The other changes 18 you've made are fine as far as I'm concerned, and I want 19 to compliment the staff for making those changes because 20 they are really better now. 21 So with that, I thank you very much. 22 CHAIRPERSON NICHOLS: Thank you. 23 Kevin Brown and then Tom Swenson. 24 MR. BROWN: Good morning, members of the Board. 25 First I'd like to say that our company, Engine PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 101 1 Control Systems, is pleased to indicate its full support 2 for the vast majority of the proposed amendments as 3 presented this morning. And, furthermore, that as a 4 company we really prioritize and appreciate our 5 relationship with ARB staff and the sharing of 6 information, the identification of issues and 7 collaborative efforts to improve the program. 8 I'm very happy today with the staff presentation 9 and what they've discussed so far about the 10 uni-directionality. This is a significant change that 11 needs some further discussion. 12 What I'd like to say is all of our Level 3 13 products have always used flow direction labels. We've 14 always communicated to end users that, you know, you 15 should not be reversing a particulate filter for any 16 reason. It creates difficulties with the cleaning 17 process. It definitely violates warranty requirements. 18 And those that choose to do it are doing it for a reason 19 which is, you know, less than ethical. 20 But at the same time, the uni-directionality, we 21 just implemented a new flange design through a parts 22 change with ARB and, you know, took over a thousand 23 dollars of cost out of many of the parts from going from 24 machine to stamp flanges. And yet -- you know, now we 25 look at having to yet make another change. And it's not PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 102 1 just the cost of tooling. It is literally the 2 implementation; the resource commitment; getting designers 3 to go back over hundreds of part numbers; five, six times 4 more subcomponent parts; bills and materials; and 5 preparing for a change like that. 6 So we'd like to -- we really would look forward 7 to discussing with staff further about how to implement 8 that for the success of the program. 9 With respect to Section 2706J, this is about 10 device labeling. And I've had some discussions with 11 enforcement officers and I've talked to staff in the past. 12 And I have a concern that I'd still like to make to the 13 Board today, which is in that section that requires that 14 the engine label and device label be identical. 15 Now, staff are flexible on that. They should 16 contain the information that's required to be on a label. 17 But I've been one that for some years have said -- you 18 know, argue that they actually should be different, 19 visually different from each other, because of the need -- 20 the potential for fraudulent uses of labels that were 21 intended to go on an engine ending up going on some 22 fraudulent device. 23 Engine labels do have a far greater risk of 24 needing to be replaced in the field because of engine 25 repairs, because of someone getting too aggressive with a PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 103 1 high pressure washer and removing the label. And if those 2 labels are identical, absolutely identical to the device 3 label, then you're getting into a process where 4 manufactures are issuing replacement labels that could be 5 used on engine or device and they end up getting used for 6 the wrong reason. 7 So I'd actually like to talk further with staff 8 about changing some of language in Section 2706J and 9 talking with enforcement staff about it to ensure that 10 they're in agreement that we have a labeling system that, 11 you know, prevents this kind of unethical, fraudulent 12 activity from occurring. 13 And it's not new. This exact same issue came up 14 in the EPA Urban Bus Retrofit Rebuild Program, which has 15 been in effect since the mid-1990s and is still actually 16 in force today. 17 Originally when labels were absolutely identical, 18 fraudulent uses of those labels that were intended for 19 engines occurred. 20 With respect to device swapping, we look forward 21 to discussions with staff about how to better define these 22 practices and their potential impact on warranty. 23 And, lastly, with respect to the implementation 24 of the non-road transient, I support the non-road 25 transient. Our company has used it in the past. We've PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 104 1 participated in programs with EP and ARB using that 2 particular test cycle. Staff's proposal is fair. I do 3 believe there still will be some issues with the 4 implementation of the non-road transient because ARB is 5 going some place where people haven't gone yet. The 6 engine manufacturers with new engines haven't gone there 7 yet. There will be some issues that will continue to need 8 to be discussed. 9 I would say to the Board that I would support any 10 activity by staff to further conduct testing of their own 11 with the non-road transient cycle to try to better produce 12 information that could be shared publicly. A lot of 13 companies for competitive reasons don't necessarily want 14 to share data publicly and openly. But to do that and to 15 also use the non-road show case as a very significant 16 opportunity to obtain further in-use NO2 emissions 17 measurements, and then compare those. The greatest issue 18 I raise in my comment is that right now the two tests that 19 are conducted to determine NO2 compliance are both done 20 within the first 23 percent of the warranty period of a 21 device, so that they're largely weighted towards the early 22 lifetime of the device. And -- 23 CHAIRPERSON NICHOLS: Mr. Brown, I think you've 24 used up your time. If I may -- if you could just finish 25 up, I'd appreciate it. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 105 1 MR. BROWN: Sure. 2 I think there might be some need for some 3 flexibility looking at specifically not the procedure but 4 the weighting values, because that would allow ARB to 5 protect public health as well as ensure that there are 6 devices out there that can be durable. Okay. 7 CHAIRPERSON NICHOLS: Thank you very much. 8 MR. BROWN: Thank you very much. 9 CHAIRPERSON NICHOLS: Okay. Tom Swenson from 10 Cleaire. You're our last witness as far as I know. 11 MR. SWENSON: Good morning. Tom Swenson, 12 Director of Sales and Verification for Cleaire Advanced 13 Emission Controls. Proud to be a California company. 14 We are here to offer our support for the proposed 15 amendments. I have two comments that I'd like to share 16 with you. 17 One is relative to the notification lights 18 requirement change on the dash. Cleaire doesn't -- we're 19 not for or against. This is really more information. We 20 know that we have customers primarily in transient and 21 school bus that have made the conscious decision to put 22 the notification lights elsewhere than on the dash. 23 Transient in particular, from what I understand, if a 24 light goes off, the drivers tend to use that as a reason 25 to quit working for the day. So they've chosen to put PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 106 1 them on the rear run panel. However you choose to go, we 2 support. Just wanted to make you aware of that. 3 The other is relative to the uni-directional flow 4 of filters. We have always labeled our filters with a 5 direction arrow. And having this issue come up again 6 caused us to relook at it internally. And in our opinion, 7 the whole point of these filters is to get rid of the crap 8 coming out the tailpipe. So to turn them around just 9 shouldn't happen. 10 We have one of our products that are currently -- 11 it's currently designed that way. We didn't experience a 12 big cost impact, any issues with handling or user 13 acceptance. So on that one in particular we'd really like 14 to strongly support the adoption for the health of the 15 community. 16 That concludes my comments. 17 CHAIRPERSON NICHOLS: Thank you very much. 18 Does staff have any additional comments, wish to 19 clarify or respond to anything? 20 Mr. Cackette. 21 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Well, I 22 would just say that the Part B leaves a couple of these 23 issues open, that we'll try to resolve these very 24 technical details in 15 days. So I think it responds to a 25 number of the points that testifiers said that we still PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 107 1 need to look at a little bit more data perhaps or deal 2 with how the warranty works on when you allow a used trap 3 to go on a vehicle, things like that. So I think most of 4 them can be worked out. 5 But on the other things like the uni-directional 6 aspect and the need for the transient test, we think 7 they're just essential changes to make the validation 8 programs that we require people to go through to look as 9 much like what the real world emissions are. We don't 10 want to verify a 85 percent device or a 15 percent NOx 11 device that ends up getting half that reduction in the 12 field. So that's the reason -- principal reason for the 13 changes. 14 CHAIRPERSON NICHOLS: Since we have a little time 15 this morning, compared with some of our meetings, I guess 16 I'd like to ask two somewhat broader questions. One 17 relates to the issue of -- well, actually it's really one 18 question. I'll try to phrase it better. 19 There was a lot of information about how our test 20 procedure differs from the European VERT procedure or the 21 U.S. EPA procedure and explanation for why ours is better. 22 But obviously there's a cost associated with that, both in 23 terms of the cost of the device manufacturers and also to 24 us, to the public, as well as whatever benefit we're 25 getting from it. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 108 1 And there's also presumably some impact in terms 2 of numbers of devices that are actually available, maybe. 3 I don't know. 4 But I'd just like to ask you to expand a little 5 bit on the thinking on this, because, you know, the 6 pressure is always coming to try to harmonize our programs 7 as much as we can with other agencies' programs, and there 8 are benefits if you can achieve them to having 9 harmonization. So I guess I'd like to hear a little bit 10 more from you on your thoughts about how the California 11 Separate Verification Program is working, whether we're 12 seeing enough devices being submitted, whether we're 13 getting them out, so forth. 14 CHIEF DEPUTY EXECUTIVE OFFICER CACKETTE: Let me 15 try a little bit at the 30,000 foot level and then ask 16 Eric if he'd like to add more on it. 17 The whole issue of sort of a universal 18 verification program for the world is the goal. But 19 unfortunately not all verifiers have the same objectives, 20 and sometimes they have different statutory requirements 21 or just historical requirements. For example, the EPA 22 program for a long time required third-party verification 23 basically, that their historical proposal -- procedures 24 said that the device manufacturer essentially couldn't be 25 trusted to do the testing themselves, so they'd have some PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 109 1 third party do it. And that's very common in a lot of 2 programs. We didn't think that was all that critical, and 3 so ours went with letting the device manufacturers do the 4 testing. And that was particularly important because that 5 way existing data could be used from the experience in 6 Europe and other places where they had particulate filters 7 on engines long before we started our program. 8 The idea of having a warranty on the retrofit 9 devices was also I think something that the Board felt 10 very strongly about, we felt strongly about. We were 11 very, very concerned that a big mistake that would result 12 in many of the people that you mandate to use these 13 devices, that they would find out that these things failed 14 in use would be the death knell to the entire diesel 15 retrofit program or the whole diesel cleanup program. And 16 so we were probably somewhat overly cautious at first to 17 make sure that the procedures that we had were very 18 comprehensive and had sided on the side of not making any 19 mistakes. 20 That resulted in a number of complaints and sort 21 of grumbling from people about, you know, it's just too 22 lard, it's too costly, it takes too long, et cetera, et 23 cetera. And those were valid. That's true, it did. But 24 I think we did it in the name of making sure that we 25 didn't end up with devices that didn't work. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 110 1 I'd point to the German program, which is a very 2 good program. But they recently had devices that got out 3 into the field and you could see smoke blowing out of them 4 under certain modes. These are supposed to be filters, 5 and they weren't working right. And it caused quite a 6 political turmoil in Germany. 7 So that was part of the reason. I think -- maybe 8 I'll ask Eric to say, you know, whether we have 40 9 devices, are there, you know, 200 devices at the federal 10 level? In part, there probably are more because they have 11 less focus on only the 85 percent level devices, which is 12 what your rules require, versus other cities, you know, 13 where there's not a mandatory program, they choose to put 14 these less effective devices. So I think there probably 15 are more of the intermediate and lower effectiveness 16 devices certified. 17 But maybe you can give some sense of how much EPA 18 has. 19 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF 20 WHITE: I don't know exactly how much EPA has. But in 21 talking with my other staff here, is we're pretty sure 22 that the ARB program has been very successful and been 23 more successful than some of these other programs in terms 24 of the number of verifications that we've been able to 25 process and approve. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 111 1 And I think one thing to keep in mind is that, 2 you know, as we've gone through and we've looked at the 3 California program and continually made adjustments to it, 4 we've been able to avoid I think some of the pitfalls that 5 some of the other programs have seen. And in particular, 6 I think the important one is looking at NO2. NO2's 7 been -- has always been an important part of this program. 8 And one of the experiences that we've seen in Europe is 9 that they're finding high levels of NO2 coming out of the 10 tailpipe of vehicles that had been retrofit. And there's 11 a great deal I think of discussion going on over there as 12 to how to address that problem, where significant sums of 13 money have been invested to clean up diesel PM and they've 14 created a separate problem in terms of NO2. 15 CHAIRPERSON NICHOLS: The air and climate 16 problem. 17 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF 18 WHITE: Um-hmm. 19 CHAIRPERSON NICHOLS: Right. 20 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF 21 WHITE: So, you know, the California program's been very 22 progressive and ahead of the curve in that way that we've 23 been able to do that. But all in all we work very closely 24 with our colleagues, both at U.S. EPA as well as our 25 European colleagues, to the point where we've had an PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 112 1 exchange of staff to go over to Europe and, you know, see 2 their program firsthand, meet with them to understand what 3 they do, exchange ideas, exchange knowledge. And we have 4 a very close working relationship with U.S. EPA as well. 5 So it's a very good program. And when you look 6 at the fact that in California, unlike most other parts of 7 it, we mandate the use of retrofits. They're not an 8 incentive-based program like they are in other parts of 9 the country. I think it's important to have the robust 10 program that we have. 11 CHAIRPERSON NICHOLS: Well, thank you. I 12 appreciate those answers. And hopefully that helps set 13 the context for what it is we're doing here today too. 14 At this point I think I can close the record. 15 But as I understand it, the record will be reopened when 16 the 15-day notice of public availability is issued. And 17 at that point written or oral comments received after the 18 hearing date but before the 15-day notice is issued will 19 not be accepted as part of the official record on this 20 agenda item. 21 When the record is reopened for a 15-day comment 22 period, the public may submit written comments on any 23 proposed changes. And those will be considered and 24 responded to in the final statement of reasons for the 25 regulation. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 113 1 So this is obviously an ongoing process. 2 But we're ready at this point I think to now hear 3 from the Board members about whether any of you have any 4 ex parte communications. 5 BOARD MEMBER BERG: I have a couple questions. 6 CHAIRPERSON NICHOLS: Questions. 7 Okay. Let's just do the ex partes first, then 8 we'll move to the discussion. 9 I have none. And I don't see anybody else who 10 has any either. 11 Okay. That's great. 12 Then I think we can move to Board discussion. 13 BOARD MEMBER BERG: Thank you, Madam Chairman. 14 I think I'd like to -- first of all, it's a great 15 job and I know that this has been long -- an evolution 16 process. And looking at the number of devices that we're 17 going to be looking at over the next couple of years, I 18 would appreciate just a comment -- we've had 40 devices 19 approved in six years. And there was a comment in the 20 Board presentation that we're going to need hundreds of 21 devices over the next several years. So could you just 22 maybe make a comment on, if we feel that we're 23 appropriately staffed and we have the resources and things 24 that the department needs in order to meet the demand that 25 we're going to be facing. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 114 1 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF 2 WHITE: Yeah, I can address that, Ms. Berg. 3 This has been a program that's really reacted I 4 think to the needs and the demands of the fleet rules that 5 the Board's approved. And in recognition of that and the 6 significant numbers that we're going to need moving 7 forward, we have actually begun to augment our staff. We 8 have two new staff that have started recently, within the 9 last month. And we have two additional staff that we are 10 expecting to get through the next budget cycle to augment 11 the staff. And that came as a direct result of the 12 Board's approval of the off-road regulation in recognition 13 of the need to get additional staff in this program to 14 support verification and make available the large number 15 of retrofits that are going to be necessary. 16 I don't want to confuse, you know, that we need 17 100 retrofits and we have 40, so we've got 60 more to go. 18 Because many of these retrofits are going to have a very 19 broad applicability to a lot of different vehicles and 20 engines out there. So one retrofit, you know, may be able 21 to be used on 50, 60 different types of vehicles or more. 22 And what we're most excited about is that -- you know, 23 when we were here in July we told you that there were 24 going to be a lot of new retrofits coming, and in 25 particular for the off-road regulation. And we've PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 115 1 recently been able to verify two new passive diesel 2 particulate filters for off-road applications for Tier 1 3 vehicles -- many Tier 1 vehicles, Tier 2 and Tier 3. 4 So today fleet operators have the choice that 5 they've been looking for. And in a passive system for 6 their vehicles, I think that's an important new 7 development that we have in this program. But we'll 8 continue to look at this and -- 9 CHAIRPERSON NICHOLS: Is this a setup between the 10 two of you, just out of curiosity? 11 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF 12 WHITE: No, no. But I'm always willing to plug our 13 programs, the positive things. 14 CHAIRPERSON NICHOLS: That's great. 15 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF 16 WHITE: But in all seriousness, I think as we look at the 17 on-road regulation, which we'll be bringing to you, as you 18 heard earlier, later this year, and look at the needs for 19 that one, we'll do a similar assessment both on what we 20 see as necessary in that marketplace and what our 21 resources are. And I think, as we have in the past, if we 22 identify the need for additional resources, we will pursue 23 them. 24 BOARD MEMBER BERG: And I think that's one of the 25 reasons I keep bringing it up. Because as we're looking PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 116 1 at the on-road rule -- and I know we have more devices for 2 on-road -- but I just want to make sure that we are 3 lending you the necessary support in order to make these 4 rules work. 5 Also, my final question is, do we have a 6 mechanism for compiling user complaints to determine if 7 there is a device that might not be performing as 8 warranted once it gets out into the field? 9 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF 10 WHITE: The procedure does have an element to it to 11 require warranty reporting. In other words, when warranty 12 claims exceed a certain threshold, they're to be reported 13 to us. 14 One of the struggles that we are -- struggles is 15 probably not the right word. But one of the pieces of the 16 program that we're continuing to try and get better 17 information on is what happens to these devices after we 18 verify them. And we're working very closely with a number 19 of manufacturers. And this year we intend to actively 20 start to collect that type of information to find out how 21 these are performing both in use and what are the warranty 22 claims associated with these. 23 Again, you know, as we've said in other forums, 24 the time to do this is now. You know, we need to get 25 ahead of -- have these procedures in place before we're PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 117 1 starting to see tens if not hundreds of thousands of these 2 retrofits in the marketplace, and then realize that we may 3 have a problem. So our philosophy has been to stay ahead 4 of that and understand what's going on early in the 5 process so we can do that. So there are provisions there 6 and we're going to continue to be pursuing that with the 7 manufacturers to get a much better and much clearer 8 picture of what's going on very shortly here. 9 BOARD MEMBER BERG: And maybe we can continue to 10 partner with the industry associations that are the users 11 of these devices and collect data through them on very 12 specific large companies who obviously would have some 13 real-world information for us as we go forward. 14 HEAVY-DUTY DIESEL IN-USE STRATEGIES BRANCH CHIEF 15 WHITE: Yes. And we'll also partner with U.S. EPA as well 16 because they have, you know, similar elements in their 17 program. And to the extent we can, we try to work very 18 closely with them so that we can both gain the same 19 knowledge, but in the end also reduce the cost to these 20 manufacturers as well, because these do represent, you 21 know, ongoing testing and monitoring costs to them. So I 22 think we have an obligation where we can as well to reduce 23 those costs to the industry where possible. And working 24 with EPA is a very good way to do that. 25 BOARD MEMBER BERG: Thank you very much. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 118 1 CHAIRPERSON NICHOLS: Are there other questions 2 before we call for the resolution to be put forward here? 3 Okay. Then would somebody care to move the 4 resolution? 5 BOARD MEMBER D'ADAMO: I'll move adoption of -- 6 let's see if we get a number here though, sorry -- 8-13. 7 CHAIRPERSON NICHOLS: Thank you very much. 8 We have a second? 9 BOARD MEMBER KENNARD: Second. 10 CHAIRPERSON NICHOLS: Very good. 11 Any additional comments or questions from Board 12 members? 13 If not, I will call the question. 14 Oh, you did. Sorry. 15 BOARD MEMBER SPERLING: Well, there was a 16 suggestion that we also direct staff to work with the 17 stakeholders dealing with labeling crankcase controls and 18 some other issues. 19 CHAIRPERSON NICHOLS: Yes. It sounds as though 20 the staff is amenable to that. But if -- I see heads 21 nodding. 22 So we will formally direct you to do what you 23 already agreed to do in terms of continuing to work with 24 all the stakeholders on the -- particularly on the issues 25 of the uni-directional installation and on the labeling PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 119 1 concern. But continue the open process that you seem to 2 have developed here. 3 All right. With that, all in favor say aye. 4 (Ayes.) 5 CHAIRPERSON NICHOLS: Any opposed? 6 Carries unanimously. 7 Thank you very much. Good job. We appreciate 8 it. 9 All right. We have one more item to deal with 10 this morning, I believe. 11 Should we take a break? Do people want to 12 stretch? 13 All right. We could do that. Let's take a 14 15-minute break and come back at a quarter to 12. 15 Thank you. 16 (Thereupon a recess was taken.) 17 CHAIRPERSON NICHOLS: Ladies and gentlemen, if we 18 could get started please. 19 We have a very brief staff presentation and a 20 couple of people who've asked to speak. 21 Before we turn to the this item, however, we've 22 been rejoined this morning by Supervisor Case, who has 23 asked to make a brief statement. 24 BOARD MEMBER CASE: I have. And thank you, 25 Chairman Nichols. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 120 1 It is my understanding that the Senate has acted 2 this morning and has not confirmed my appointment by the 3 Governor of this Board -- by the Governor to this Board. 4 On the advice of counsel, I have been informed 5 that I am eligible to serve for 60 days before my 6 appointment expires, according to Government Code 1774C. 7 I take representation of the San Joaquin Valley 8 very seriously. There are many important items before the 9 Board over the next 60 days that will have a direct impact 10 on public health in the San Joaquin Valley. The decision 11 about the distribution of Prop 1B funds is critical to the 12 valley to get an appropriate share. 13 Senators Florez and Perata wish to eliminate my 14 valley representation during this crucial time, leaving 15 the valley without a voice. However, I will not abandon 16 the valley, but will serve for the remaining time, as 17 allowed according to the Government Code. 18 I appreciate the confidence and the support of 19 Governor Schwarzenegger for appointing me to this very 20 important board. I have been honored to serve with such a 21 distinguished board, each and every one of you, and such a 22 distinguished staff, who -- you are all so incredibly 23 intelligent and committed to cleaning up our air and 24 making sure we all can breathe clean air. 25 I know the Governor will appoint an excellent PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 121 1 candidate for the San Joaquin Valley representative. I 2 encourage him to be thoughtful in this very important 3 appointment. And I hope by my willingness to continue 4 during this interim time that he will have an opportunity 5 to thoroughly evaluate and thoughtfully consider the 6 credentials of potential candidates. 7 Thank you, Madam Chairman. 8 CHAIRPERSON NICHOLS: Well, thank you very much. 9 I am happy that we don't have to say good-bye to 10 you this morning, because I'm not prepared to do so. I 11 would like to say -- I think I speak on behalf of all the 12 Board -- that we are grateful to you for your service, 13 which has been diligent and distinguished and 14 characterized by both a high degree of ethical 15 consciousness and great determination to serve the people 16 that you are representing on this Board. And we are happy 17 that we will continue to be able to work with you over the 18 next 60 days. 19 And thank you for your statement. Thank you very 20 much. 21 BOARD MEMBER CASE: Thank you. 22 CHAIRPERSON NICHOLS: With that, I guess we turn 23 to the ZEV item. 24 EXECUTIVE OFFICER GOLDSTENE: Analisa Bevan will 25 present the quick overview. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 122 1 CHAIRPERSON NICHOLS: Thank you. 2 (Thereupon an overhead presentation was 3 Presented as follows.) 4 ZEV IMPLEMENTATION MANAGER BEVAN: Good morning, 5 Chairman Nichols and members of the Board. 6 My presentation today will briefly review the 7 issues before you regarding: 8 The request to release data pertaining to vehicle 9 production and associated credits related to the ZEV 10 regulation; 11 The efforts that have taken place on an agreement 12 between automakers and the ZEV Alliance on access to data; 13 and 14 A summary of the options before you today for 15 next steps. 16 --o0o-- 17 ZEV IMPLEMENTATION MANAGER BEVAN: As you recall 18 from the December Board hearing, the Board considered a 19 legal opinion regarding the release of historical ZEV data 20 production -- ZEV vehicle production and credit data. The 21 Board decided to table the decision on the Public Records 22 Act request while directing staff to seek a compromise 23 between the automakers and the ZEV Alliance regarding 24 making these data available. 25 It was clear from the Board's discussion that you PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 123 1 desired the compliance status of the program be 2 transparent. And some Board members also expressed 3 concern about changing the rules retroactively regarding 4 materials given to the Board that were marked 5 confidential. 6 Next slide. 7 --o0o-- 8 ZEV IMPLEMENTATION MANAGER BEVAN: The staff 9 began efforts to seek an agreement through a series of 10 meetings with the ZEV Alliance and the large automakers, 11 those subject to the complete suite of ZEV obligations and 12 referred to as the Big 6. They include Chrysler, Ford, 13 GM, Honda, Nissan, and Toyota. 14 From the ZEV Alliance we heard: 15 Concerns about being able to forecast the effect 16 of staff's proposed changes to the regulation without 17 access to automaker ZEV bank balances; 18 Concerns about the accuracy of the ZEV credit 19 bank accounts; 20 And concern about the precedent said by this 21 regulation on other regulations that may include banking 22 and trading options and their desire that these be made 23 public. 24 Through our meetings it became clear that there 25 highest priority was in fact this last concern and that PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 124 1 changes to the regulation to make future data submissions 2 and credit balances public is their most important goal. 3 From the automakers we learned that their 4 concerns were focused around protection of their current 5 ZEV bank credit balances and credit trades that have taken 6 place between automakers. They were concerned about 7 future release of production data and credit balances, but 8 were willing to discuss these changes to the program if 9 adequate lead time were provided. 10 --o0o-- 11 ZEV IMPLEMENTATION MANAGER BEVAN: Actually back 12 up. Sorry. 13 --o0o-- 14 ZEV IMPLEMENTATION MANAGER BEVAN: Since it 15 appeared that there were a number of different elements of 16 the request that could be worked on separately, in an 17 effort to seek a compromise we sent a questionnaire to the 18 automakers asking them to respond to the idea of releasing 19 historical production data, releasing more sensitive data 20 types like trades, amending the regulation to make future 21 data submissions public, and disclosure of the automaker's 22 intended compliance path in the 2009 to 2011 timeframe. 23 Upon response to the questionnaire and after 24 additional phone conferences, it was agreed that a 25 face-to-face meeting would best facilitate efforts to find PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 125 1 a compromise. This meeting took place yesterday. 2 --o0o-- 3 ZEV IMPLEMENTATION MANAGER BEVAN: This has been 4 a dramatic process and we've attempted to find common 5 ground between the ZEV Alliance and the automakers. A 6 number of interim suggestions were made, bringing us 7 closer to an agreement. 8 At this point we've reached the following points 9 of compromise: 10 1) ZEV Alliance is willing to forgo the request 11 for historical data and drop the PRA if new data is made 12 public. 13 The Big 6 automakers agree to public release of 14 future data as well. 15 And both parties have agreed to make production 16 data public starting with model year 2009. This means 17 that automakers would publicly report the make, model, ZEV 18 type, number of vehicles, and credit per vehicle each year 19 starting with the 2009 model year. 20 Where disagreement remains is when the ZEV credit 21 bank balances would be made public. The Big 6 automakers 22 have offered the 2010 model year. Since the 2009 model 23 year has already begun, starting with the 2010 model year 24 allows them to plan for a release of this data. 25 Additionally, as Chairman Nichols described this PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 126 1 morning, release of the bank balances in the 2010 model 2 year will make the data available in time for the Board's 3 next technology assessment of the ZEV regulation. 4 The ZEV Alliance requests that the release of 5 bank balances begin with the 2009 model year. Their 6 reasoning is that in forgoing the historical data, 7 automaker-specific bank balances are needed at the same 8 time as production data in order to begin the transparency 9 of the program and to assess accuracy of the compliance 10 tracking system as soon as possible. 11 Unfortunately, this leaves us without an 12 agreement on the treatment of ZEV credit data. Although 13 staff feel we are closer to understanding the needs of 14 each party. A great deal of progress has been made toward 15 reaching a solution that can be carried out with 16 regulatory amendments rather than through action on the 17 PRA. 18 --o0o-- 19 ZEV IMPLEMENTATION MANAGER BEVAN: Where this 20 leaves the Board is with a decision to make regarding the 21 PRA. If the Board chooses to accept the PRA request to 22 release the data, staff will notify the ZEV credit bank 23 account holders and give them 21 days to consider actions 24 to block release. If the Board chooses to deny the PRA, 25 we anticipate that the ZEV Alliance will consider suing PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 127 1 the Air Resources Board on their decision. If the Board 2 chooses to table the decision on the PRA, it is hoped that 3 staff can propose regulatory amendments that will meet the 4 needs of all the stakeholders and would thus cause the PRA 5 to be withdrawn. 6 Since it's clear that the Board wishes the ZEV 7 Program to be more transparent and since both parties have 8 agreed in principle to future data release -- that future 9 data would be made public through amendments to the 10 regulation, if the Board decides to deny or table the PRA, 11 staff will pursue regulatory amendments to make the 12 production data and credit balances public. Staff will 13 recommend that the 2009 model year production data be made 14 public and will recommend bank balances be made public in 15 2010. 16 This concludes staff's presentation. Thank you. 17 CHAIRPERSON NICHOLS: Thank you. 18 Well, that chart kind of lays out the options, 19 doesn't it? 20 We do have three witnesses who signed up to 21 speak: Tim Carmichael, Bonnie Holmes-Gen, and Kathy 22 Lynch. 23 So in that order, if you'd like to come forward 24 and speak. 25 MR. CARMICHAEL: Good morning, Chairman Nichols, PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 128 1 members of the Board. Tim Carmichael with the Coalition 2 for Clean Air. 3 I fortunately was not stuck in the three-hour 4 meeting yesterday. I did participate for the first hour 5 of it and don't want to delay this issue. But I do want 6 to, you know, note for the record that we feel like we 7 have come a long ways on this issue. You know, it was 8 just one bullet point on Analisa's slide, but, you know, 9 letting go of all the historical data, five items in our 10 Public Records Act request, is not a small give, if you 11 will. And, you know, as this Board acknowledged -- or 12 many of you acknowledged in December, it seems really 13 reasonable to us to require public disclosure of this 14 information going forward. 15 I personally believe going forward should start 16 today. That is not an official ZEV Alliance position. We 17 are still debating this among our colleagues. But that's 18 my personal perspective, that it should start today. And 19 that means model year '08 effectively. 20 So with that, we support continuing the 21 discussions. And I have heard your staff member, Tom 22 Cackette, and you, Chairman Nichols, loud and clear, that 23 you would greatly appreciate us resolving this with the 24 automakers as quickly as possible. 25 Thank you. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 129 1 CHAIRPERSON NICHOLS: Thank you very much. I 2 appreciate that. 3 And I would like to say I very much appreciate 4 your willingness to engage and to try to reach a 5 resolution of this. And I would like to say you have come 6 a long way in terms of your focus on the issues. So I 7 appreciate that a lot. 8 MS. HOLMES-GEN: Good afternoon, Chairman 9 Nichols, members. Bonnie Holmes-Gen, American Lung 10 Association of California. 11 And I also wanted to make a similar point as my 12 colleague Tim Carmichael. 13 Last month we did come to you and urge you -- 14 urge your Board to determine that the ZEV credit 15 information is not a trade secret, and we ask for the full 16 disclosure of all the historical information. 17 And we did upon your request thoughtfully 18 consider our position. And we did agree to participate 19 and we did participate in discussions and in the meeting 20 with the car companies, and we have considered other 21 options. And we believe that when we came back and 22 offered to drop our request for disclosure of the 23 historical credit information, that that was an extremely 24 large concession. And we have given up a lot. And we are 25 surprised frankly that we're being asked to give up any PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 130 1 more. 2 We had asked for five categories of historical 3 information and of course all the future credit balances. 4 And it's very -- it's hard to consider giving up more. 5 The fact that we're a year apart may seem like a 6 small matter, but I don't think it is. We had originally 7 asked for all this information to be available immediately 8 January 31st, 2008. Given that that was not acceptable, 9 we then moved even more and said we would consider getting 10 the information for the 2008-2009 model year. And now of 11 course we're being asked to look at getting information 12 from 2010 model year. And that would mean the information 13 would not be available to us until some time in 2011. 14 That's a long time from now. 15 We do need that credit balance information in 16 addition to the ZEV production information. We need it to 17 fully understand what the car companies' compliance will 18 be in the next phase and to understand the status of the 19 credit balances, understand the status of compliance with 20 the ZEV Program. 21 We are going to continue discussions, as you've 22 asked. But we would just ask you to consider that we've 23 come a long way and we don't believe there's a need to 24 accommodate the car companies anymore on this. 25 CHAIRPERSON NICHOLS: Thank you. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 131 1 Kathy Lynch. 2 MS. LYNCH: Good afternoon. I'm always the last 3 one right at lunch hour. 4 First of all, I want to say thank you to the 5 staff and the Board for your work on this. I think the 6 presentation was very clear on where things stand. 7 Representing Plug in America, we really do look 8 at it from the public perspective. And we did file 9 comments on December 31st of '07. We do believe that we 10 have to know where we've been to know where we're going 11 for the consuming public. They need to understand the 12 current credit situation to know how to make good consumer 13 choices going forward. And that's our primary argument. 14 I would agree with both what Tim and Bonnie have also 15 commented on. 16 Thank you. 17 CHAIRPERSON NICHOLS: Thank you. 18 That I believe concludes our list of public 19 speakers. 20 And I would like to say again that the ZEV 21 Alliance has raised an important issue here. And we think 22 that in terms of the overall balance of interests here, we 23 need to fix this program so it's more transparent. And we 24 are -- I think there's no member on this Board who was 25 here at the time that the decisions were made that PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 132 1 were -- that have led us to the situation that we find 2 ourselves in at this moment. And if there are, I suspect 3 they might want to reconsider. 4 (Laughter.) 5 CHAIRPERSON NICHOLS: But I think the question 6 about what happens at the moment with the data that has 7 been submitted to date is a concern, not because of from 8 what I've heard a fear of the public or of organizations 9 such as yours using the data, so much as it is a concern 10 about the competitive aspects of it, how it would be used 11 within the industry itself. Which is sort of ironic, but 12 simply points to a problem that we've got to try to 13 grapple with as we make changes to this program. 14 I think we're -- we know we've got to wrestle 15 with some really critical issues about program 16 effectiveness overall. All of us would like to see this 17 program not get smaller but get bigger in terms of impact 18 that it has on the overall fleet in California. 19 So this issue of the data and how it's dealt with 20 is now going to be front and center I believe in our 21 considerations when this comes back before us, as the 22 staff is planning to do, in March. 23 And I would invite my fellow Board members to 24 add, you know, some specific thoughts and directions to 25 the staff in terms of what they'd like to see in the PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 133 1 resolution in March for the regulation. 2 But, again, as I indicated earlier, I'm hoping 3 that we can just continue to table the request as it is 4 today and let the discussion about the historic data move 5 forward, if it can, off line here. 6 Yes. 7 BOARD MEMBER BERG: Then based on the comments 8 and the fact that we have seen action moving -- and the 9 fact that this is going to come back to us in March, which 10 is right around the corner, I would like to move that we 11 table this issue until March and to direct staff to bring 12 back to us as part of the ZEV review the issue of the 13 credits and more transparent going forward. 14 CHAIRPERSON NICHOLS: Do we have a second for 15 that? 16 BOARD MEMBER SPERLING: I'll second that. 17 CHAIRPERSON NICHOLS: Thank you. 18 Okay. Any further comments or discussion at this 19 time? 20 Hearing none. 21 That's how we'll do with the item. We will -- 22 have a vote. Sorry. We do have to vote. 23 So I'll call the vote on Ms. Berg's motion. 24 All in favor please say aye. 25 (Ayes.) PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 134 1 CHAIRPERSON NICHOLS: Opposed? 2 None. 3 Thank you very much. 4 Must be lunchtime, I guess. 5 All right. So is that -- we do have a public 6 comment period normally if anybody wants to raise any 7 issues that were not on the agenda. We have none. 8 Anything else? 9 EXECUTIVE OFFICER GOLDSTENE: No, Madam Chairman. 10 CHAIRPERSON NICHOLS: All right. Very good. 11 Then thank you. 12 We will be adjourned. 13 Thanks, everybody. 12:11 PM 14 (Thereupon the Air Resources Board meeting 15 adjourned at 12:11 p.m.) 16 17 18 19 20 21 22 23 24 25 PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 135 1 CERTIFICATE OF REPORTER 2 I, JAMES F. PETERS, a Certified Shorthand 3 Reporter of the State of California, and Registered 4 Professional Reporter, do hereby certify: 5 That I am a disinterested person herein; that the 6 foregoing California Air Resources Board meeting was 7 reported in shorthand by me, James F. Peters, a Certified 8 Shorthand Reporter of the State of California, and 9 thereafter transcribed into typewriting. 10 I further certify that I am not of counsel or 11 attorney for any of the parties to said meeting nor in any 12 way interested in the outcome of said meeting. 13 IN WITNESS WHEREOF, I have hereunto set my hand 14 this 12th day of February, 2008. 15 16 17 18 19 20 21 22 JAMES F. PETERS, CSR, RPR 23 Certified Shorthand Reporter 24 License No. 10063 25 PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345