1 VW Environmental Mitigation Trust: Maximizing Emission … · 2017-05-09 · All-electric: up to...
Transcript of 1 VW Environmental Mitigation Trust: Maximizing Emission … · 2017-05-09 · All-electric: up to...
VW Environmental Mitigation Trust:
Maximizing Emission Reduction
Benefits for Oregon and
Washington State
MAY 9, 2017
#MyOregon Photos
1
Welcome!
Todays webinar is being recorded for later viewing reference.
A link to the presentation will be provided to everyone after today’s session
via email.
You can ask questions at any time via the online Q&A feature. We will
allow for at least a 20 minute Q&A at the end. Or you can contact us at
anytime after the session.
We appreciate your feedback. Please help us by taking a 3 minute survey
at the end.
Thank you for attending!
2
Calendar of Upcoming Events
Making the Most of the VW Settlement: More Clean Air for the Dollar
May 18, 2017 2:00 pm PT – California
June 7, 2017 11:00 am ET – New York
June 7, 2017 2:00 pm ET – Florida
June 8, 2017 11:00am ET – Pennsylvania
June 8, 2017 2:00 pm ET – Texas
June 14, 2017 2:00 pm ET – Cost Effectivenessof Big Engine Replacements and How to Pursue Opportunities
3
Our team for today’s webinar
Allen Schaeffer Executive Director
Kristen Gifford Director of Communications
Ezra Finkin Director of Policy & External Affairs
4
5
Objectives for Today
Provide a brief overview of the VW Environmental Mitigation Trust and its process and help
answer some important questions:
What are the categories of eligible projects?
What are the largest sources of NOx emissions in the region?
What is the make up of commercial vehicles on the road in the region? Of these, which
are eligible for funding?
What are the benefits of upgrading larger equipment?
What are cost effective investment strategies to make the most of Trust revenues?
6
Focus of our Webinar Today:
Opportunity for $2.9 Billion to Mitigate NOx Emissions through
Upgrading Heavy-Duty Vehicles & Equipment
Environmental Mitigation
Trust In Perspective
$2.9 Billion to be spent in as
little as 3 years for the sole
purpose of NOx reduction
Total DERA Funding 2008-
2013: $520 Million
• 73,000 engines, vehicles
& equipment
• 335,200 tons of NOx
reduced
$10 Billion - VehicleBuyback/LeaseTermination(Appendix A & B)
$2.9 Billion -Environmental Mitigation Trust (Appendix D)
$2.0 Billion - ZeroEmission PassengerVehicle Commitment(Appendix C)
Breakdown of the Components of the $14.9 Billion
VW Settlement
7
The Process: Getting to the “Trust
Effective Date” is the First Milestone
First Major Milestone:
Trust Effective Date
8
Applications For Funding Can Flow
After the “TED”
TED Assumptions
(A)May 2017: Funding Plans Submitted
by December 2017
(B) June 2017: Funding Plans Submitted
by January 2018
Trustee Requirements
Maintain a public website listing
projects funded, terms of the award
and anticipated NOx reduction
• 60 days after the TED, States must notify the
Trustee of their intention to be listed as a
beneficiary and announce a lead agency to
manage applications sent to the Trustee.
• 120 days after the TED, the Trustee will publish the
list of beneficiary states
• 90 days after being listed as a beneficiary, states
must submit to the Trustee a plan that outlines how
the state intends to spend Trust revenue. (7 months
from TED)
9
Appendix D Represents an Historic Funding
Opportunity to Reduce NOx Emissions
Environmental Mitigation Trust
$113 Million
$73 Million
DERA Funding (2008 – 2013)
$15.6 Million
$18.6 Million
10
Framework For
Decision-makingHOW TO SPEND THE FUNDS?
PROJECT SELECTION
11
Framework for Environmental
Mitigation Trust Fund Decision-making
Identify the largest sources of NOx emissions
Identify the most cost-effectiveopportunity to reduce NOx emissions
Identify the opportunities that are available now and yield the near-termNOx reduction benefits
Identify the geographical locations of those source NOx emissions
Excess NOx emissions were generated by
VW non-compliant
vehicles.
The EMT is for mitigating those NOx emissions.
Maximize
NOx Emissions
Reductions
Now
More Clean
Air for the
Dollar
Collateral
Benefits in
Fuel Savings
and CO2
12
Heavy-Duty Vehicles & Equipment Are
the Largest Sources of NOx Emissions
Where are the largest Sources of NOx Emission in PNW?
Heavy-Duty Applications
SOURCE: National Emissions Inventory Data (2014), U.S. EPA
NOx Emission (tons per year) OR WA
Electricity Generation and Fuel Combustion 18,689 28,331
Industrial 4,812 9,543
Wildfires 19,127 15,946
Other 13,478 16,568
Mobile Sources 94,342 188,543
Aircraft 1,550 3,414
Heavy-Duty Vehicles & Equipment 49,264 113,109
Passenger Vehicles 43,528 72,020
13
Trucks, Equipment, Locomotives and Marine
Make Up the Heavy-Duty Category
Commercial Marine Vessels
4%
Locomotives22%
Non-Road Equipment
35%
Heavy Duty Vehicles
39%
Oregon: Heavy-Duty Sources of NOx Emissions
Commercial Marine Vessels
16%
Locomotives13%
Non-Road Equipment
25%
Heavy Duty Vehicles
46%
Washington State: Heavy-Duty Sources of NOx Emissions
SOURCE: National Emissions Inventory Data (2014), U.S. EPA
14
EligibilityWHAT CATEGORIES OF
VEHICLES AND EQUIPMENT
ARE ELIGIBLE FOR NOX
MITIGATION FUNDING?
15
Categories of On-Road Vehicles
Eligible for Funding
Class 8 Local Freight Trucks
Non-Government Owned
Diesel, CNG, Hybrid Repower: Up to 40%
Diesel, CNG, Hybrid Repurchase: Up to 25%
All-electric repower or repurchase: up to 75%
Government Owned: 100%
Class 4-8 Buses (school, transit or shuttle)
Non-Government Owned
Diesel, CNG, Hybrid Repower: Up to 40%
Diesel, CNG, Hybrid Repurchase: Up to 25%
All-electric repower or repurchase: up to 75%
Government Owned: 100%
Dray Trucks
Non-Government Owned
Diesel, CNG, Hybrid Repower: Up to 40%
Diesel, CNG, Hybrid Repurchase: Up to 50%
All-electric repower or repurchase: up to 75%
Government Owned: 100%
16
Off-Road Equipment and Technologies
Eligible for Funding
Freight Switchers (Pre Tier 4)
Non-Government Owned
Diesel, CNG, Hybrid Repower: Up to 40%
Diesel, CNG, Hybrid Repurchase: Up to 25%
All-electric: up to 75%
Government Owned: 100%
Ferries/Tugs Repower (Tier 0 to Tier 2)
Non-Government Owned
Diesel, CNG, Hybrid: Up to 40%
All-electric: Up to 40%
Government Owned: 100%
Airport Ground Support
All-electric
Forklifts
All-Electric
The DERA Option
Funds may be used for Non-Federal Match
Designed to capture the wide variety of off-road equipment that would be too large to list in the consent decree
17
The DERA Option: Expands list of eligible projects
and opportunities for greater reductions
Figure 1 DERA Option: Trust Funds as
Voluntary Match to Receive EPA
Matching Incentive
Figure 2: DERA Option: Trust funds as
a Larger Voluntary Match to Achieve
Additional NOx reductions
DERA Allocation $200,000
DERA Allocation $200,000
Total Funding $500,000
Total Funding
$1.3M
Mitigation Trust Fund $200,000
Mitigation Trust Fund
$1 M
EPA Bonus
$100,000
EPA Bonus
$100,000
NOTE: Graphic Does NOT include mandatory cost share funds
18
Clean Diesel is
the Best
Technology
Choice
MORE CLEAN AIR BENEFITS FOR THE DOLLAR, FASTER
19
Clean Diesel Technology is Ready
Today to Reduce NOx Emissions
✓ Clean Diesel = Advanced engines + latest emissions control strategies + ultra-low sulfur diesel fuel
✓ Available Now
✓ No additional infrastructure investments needed
✓ Proven to deliver NOx reductions
✓ Technology of choice by user community
✓ Cost-effective - will yield more clean air for the dollar than other fuels and technologies
20
Evolution of Diesel Technology: On-Road
21
Evolution of Diesel Technology Off-Road Engines and Equipment
0
2
4
6
8
10
12
14
1988 1991 1994 1997 2000 2003 2006 2009 2012 2015
g/bhp-hr Progress to Near-Zero NOx Emissions
Off-Road Equipment: Backhoes and Ag
Tractors
Line Haul Locomotives
Switch Locomotives
Heavy Duty On-Road Vehicles
Clean Diesel Technology Meets Near
Zero Emissions Requirements
Class 3 - 8
23
Replacing the Oldest Trucks with the Newest
Generates Substantial Emissions Reduction
0
2
4
6
8
10
12
1988 1991 1994 1997 2000 2003 2006 2009 2012 2015
Engine Emissions Standards for Heavy-Duty Trucks and Annual NOx Emissions Reduction from Moving to New Clean Trucks
NOx (g/bHp-hr)
2011 or Newer Emissions Standard
1,282 LBS
1,2
82
lbs
1,0
61
lbs
1,2
82
lbs
84
0lb
s
39
6lb
s
24
Investing in new clean diesel technology will achieve
dramatic reductions in PM emissions as well
Health Effects Institute ACES Study of New Technology Diesel Engines Finds Major declines in PM Mass and Numbers Emissions
On-Road Fleet Profile: Washington State
3 out of 4 trucks on the road in WA are eligible for
funding through the Trust
SOURCE: DTF Analysis of Commercial Vehicles in Operation (2016), compiled by IHS Markit
26
School Buses Transit Buses Class 3-8 Trucks*(see note below)
Class 8 Trucks (Over 26,000lbs gvwr)
Diesel: 98 %
Gasoline: 1.8 %
CNG 0.2 %
Diesel 86.7 %
Electric 12.6 %
CNG 0.66 %
Diesel 69.2 %
Gas 30.5 %
CNG 0.3 %
Diesel 98.8%
CNG 1.0%
Gas 0.1%
29.5% are 2011 and
newer
33.7% are 2011 and
newer
25% are 2011 and
newer
23.9% are 2011 and
newer
National Avg.: 31.3% National Avg. 35.2% National Avg. 30.0% National Avg. 31.3%
*NOTE: Only Class 4-8 trucks are eligible for VW Settlement funding. This data includes class 3-8.
On-Road Fleet Profile: Oregon
60% trucks on the road in OR are eligible for
funding through the Trust
SOURCE: DTF Analysis of Commercial Vehicles in Operation (2016), compiled by IHS Markit
27
School Buses Transit Buses Class 3-8 Trucks*(see note below)
Class 8 Trucks (Over 26,000lbs gvwr)
Diesel: 95%
Gasoline: 5 %
Diesel 100% Diesel 71.0 %
Gas 28.9 %
CNG 0.1 %
Diesel 99.3%
CNG 0.39 %
Gas 0.21 %
25.7% are 2011 and
newer
67.2% are 2011 and
newer
30% are 2011 and
newer
29.4% are 2011 and
newer
National Avg. 31.3% National Avg.
35.2%
National Avg.
30.0%
National Avg. 31.3%
*NOTE: Only Class 4-8 trucks are eligible for VW
Settlement funding. This data includes class 3-8.
Additional Co-Benefits Accrue from
Clean Diesel on the Road
A typical Class 8 tractor on the road for 125,000 miles each year. A clean diesel engines will:
Reduce NOx Emissions by 2.3 tons
Reduce Fine Particle Emissions by 251 pounds
Save 23 barrels of crude oil
Eliminate 9.7 tons of CO2 emissions
28
Off-Road
Engines &
Equipment
LARGE ENGINES
LARGE OPPORTUNITIES
LARGE BENEFITS
29
EPA 2016 Port Strategy Assessment outlines
the advantages of clean diesel
“Older trucks and equipment are longstanding fixtures of many port operations, and it will take many years before these fleets turn over to newer technology. “
“Accelerating the retirement of older port vehicles and equipment and replacing them with the cleanest technology will reduce emissions and increase public health benefits beyond what would be achieved without further voluntary actions.”
“For example, the emission reductions from replacing older drayage trucks with cleaner diesel trucks is significant, with NOx emissions being reduced by up to 48% in 2020 and PM2.5 emissions being reduced by up to 62% as compared to the Business as Usual case.”
https://www.epa.gov/ports-initiative/national-port-strategy-assessment
30
Switch Locomotive Engine Replacements
Yield BIG NOx Reductions
94% Reduction
in NOx from
oldest to
newest “Tier 4”
37,602 LBS
NOx/Year
Replacing 29pre-1992 Port
Trucks with
New Model
Switch Locomotive
Replacing the Oldest
Engines with Newest
“Tier 4” Clean Diesel
SOURCE: National Port Strategy Assessment. U.S. EPA. 2016
31
Single Tug Boat Marine Engine
Replacement Offers BIG NOx Reductions
91% reduction
in NOx from
oldest to
newest “Tier 4”
96,000 LBS
NOx/Year
Replacing 76pre-1992 Port
Trucks with
New Model
Tug Boat
Replacing the
Oldest Engines
with “Tier 4”
Clean Diesel
NOx g/Kw-Hr
SOURCE: National Port Strategy Assessment. U.S. EPA. 2016
32
Replacing the Oldest Ferry Boat Engines with
New Technology Delivers Immediate Benefits
90% Reduction
in NOx from
oldest to
newest “Tier 4”
62,000 LBS
NOx/Year
Replacing 48 pre-
1992 Port Trucks
with New Model
Ferry
Replacing the
Oldest Engines
with “Tier 4”
Clean Diesel
SOURCE: National Port Strategy Assessment. U.S. EPA. 2016
33
Strategies to Achieve Immediate Term NOx
Reduction
The Minnesota
Pollution
Control Agency
estimates that
the fleet of VW
cars generated
600 tons of
excess NOx
emissions
34
Nothing Beats Clean Diesel
When it Comes to:
Cost Effectiveness of
Reducing Emissions
Making the Most of
Environmental Mitigation
Fund Investments
35
Clean Diesel Maximizes NOx Reduction
Investments for Washington
How to Make the Most of a $113 million Investment for Immediate NOx Reduction
Price Per Application
# of Vehicles or Equipment placed into Service for $113 million
Anticipated NOx Reduction per Year per Project
Total Cost to Exclusively Fund a Particular Project
Cost to Remove Each lb of NOx ($/lb)
Total NOx (lbs) Reduction per year
pre 1991 port truck replacement with Clean Diesel $110,000 1,027 1,282 $113,000,000 $86 1,316,964pre 1991 port truck replacement with CNG $140,000 807 1,292 $113,000,000 $108 1,042,829MY2000 bus replacement with Hydrogen $1,200,000 94 1,162 $113,000,000 $1,033 109,422MY2000 bus replacement with Battery-Electric $880,000 128 1,162 $113,000,000 $757 149,211MY2000 bus with Clean Diesel $370,000 305 1,062 $113,000,000 $348 324,341T0 to T4 Clean Diesel switch locomotive $3,000,000 38 37,602 $113,000,000 $80 1,416,342
Source: (1) National port Strategy Assessment: Reducing Air Pollution and Greenhouse Gases and U.S. Ports". U.S. EPA (September 21, 2016), (2) "clean Diesel Versus CNG Buses: Cost, Air Quality and Climate Impacts." Clean Air Task Force (2012). (3) "From Deceit to Transformation: How Connecticut Can Leverage Volkswagen Settlement Funds to Accelerate Progress to a Clean Transportation System. CONN PIRG. January 18, 2017. (4) "Consortium to Fund New Flyer Hydrogen Buses to ACTransit", Passenger Transport, February 24, 2017. (5) Locomotive engine upgrade cost based on a range of industry estimates.
36
Clean Diesel Maximizes NOx Reduction
Investments for Oregon
How to Make the Most of a $73 million Investment for Immediate NOx Reduction
Price Per Application
# of Vehicles or Equipment placed into Service for $73 million
Anticipated NOx Reduction per Year per Project
Total Cost to Exclusively Fund a Particular Project
Cost to Remove Each lb of NOx ($/lb)
Total NOx (lbs) Reduction per year
pre 1991 port truck replacement with clean diesel $110,000 664 1,282 $73,000,000 $86 850,782pre 1991 port truck replacement with CNG $140,000 521 1,292 $73,000,000 $108 673,686MY2000 bus replacement with Hydrogen $1,200,000 61 1,162 $73,000,000 $1,033 70,688MY2000 bus replacement with Battery-Electric $880,000 83 1,162 $73,000,000 $757 96,393MY2000 bus with Clean Diesel $370,000 197 1,062 $73,000,000 $348 209,530T0 to T4 Clean Diesel switch locomotive $3,000,000 24 37,602 $73,000,000 $80 914,982
Source: (1) National port Strategy Assessment: Reducing Air Pollution and Greenhouse Gases and U.S. Ports". U.S. EPA (September 21, 2016), (2) "clean Diesel Versus CNG Buses: Cost, Air Quality and Climate Impacts." Clean Air Task Force (2012). (3) "From Deceit to Transformation: How Connecticut Can Leverage Volkswagen Settlement Funds to Accelerate Progress to a Clean Transportation System. CONN PIRG. January 18, 2017. (4) "Consortium to Fund New Flyer Hydrogen Buses to ACTransit", Passenger Transport, February 24, 2017. (5) Locomotive engine upgrade cost based on a range of industry estimates.
37
Summary - #1
States should utilize a framework that considers the largest sources of
NOx emissions & the greatest opportunity for reductions that makes
most of the VW settlement dollars available.
Investments in new clean diesel technology are the best choice to
mitigate NOx emissions because they deliver faster, near term
proven clean air benefits without additional infrastructure or other
investments.
38
Summary - #2
Project simplification and streamlining – replacing a few targeted
oldest and largest engines reduces overall state administrative
burdens, as compared to other approaches where infrastructure
investments and technology availability require additional time and
have greater uncertainty. Existing mechanisms provided via DERA.
Replacing older diesel engines with new clean diesel ones yields additional collateral air quality emissions reductions in particulate
matter, CO2 benefits beyond NOx mitigation accrue often in
population centers, and can help address other issues.
39
Resources for Clean Diesel in Washington State &
Oregon - www.dieselforum.org/in-your-state
40
Large Engine
Upgrades Deliver
Enormous Emission
Reduction Benefits
Learn more about the VW Environmental
Mitigation Fund and Download this
Infographic
http://dieselforum.org/vwfund
41
Switch Locomotive
“Repowers” are a Cost
Effective NOx
Reduction Strategy
Learn more about the VW
Environmental Mitigation Fund and
Download this Infographic
http://dieselforum.org/vwfund
42
A New Tier 4 Clean
Diesel Engine Powering
a Ferryboat
Significantly Reduces
NOx Emissions
Learn more about the VW
Environmental Mitigation Fund and
Download this Infographic
http://dieselforum.org/vwfund
43
Resources Available
The DERA Option: https://www.epa.gov/sites/production/files/2017-01/documents/vw-dera-option-factsheet-2017-01.pdf
Link to Partial Consent Decree: www.epa.gov/enforcement/partial-consent-decree-volkswagen
Link to FAQs: https://www.epa.gov/enforcement/faqs-beneficiaries-vw-mitigation-trust-agreement
Link to Consent Decree Informational Slides: www.epa.gov/sites/production/files/2016-11/documents/webinar_for_prospective_beneficiaries_11_22_2016.pdf
State Program Guide and information: www.epa.gov/cleandiesel/clean-diesel-state-allocations More
VW Settlement and Washington State: http://www.ecy.wa.gov/programs/air/cars/vw_fed.htm
VW Settlement and Oregon: https://www.oregon.gov/deq/aq/programs/Pages/VW-Diesel-Settlement.aspx
44
Questions & Answers
Please submit via the Q&A
feature.
45
Calendar of Upcoming Events
Making the Most of the VW Settlement: More Clean Air for the Dollar
May 18, 2017 2:00 pm PT – California
June 7, 2017 11:00 am ET – New York
June 7, 2017 2:00 pm ET – Florida
June 8, 2017 11:00am ET – Pennsylvania
June 8, 2017 2:00 pm ET – Texas
June 14, 2017 2:00 pm ET – Cost Effectivenessof Big Engine Replacements and How to Pursue Opportunities
46
Thank you for attending! Please
complete our brief 3 minute survey at
the conclusion of today’s session.
Allen SchaefferExecutive Director
Ezra FinkinDirector of Policy and External Affairs
[email protected](301) 668-7230
47