Ports gradually weed out old container-transporting trucks with incentive programs.
By Eric Kulisch
Agrowing number of ports, following in the footsteps of Los Angeles and Long Beach, have developed voluntary programs to replace older drayage trucks as part of broader efforts to minimize the impact of their operations on local air quality.
Several port authorities and states have provided incentives, supported with grants from the Environmental Protection Agency, designed to leverage private sector investment in late-model trucks.
But the process has been slow in most locations given the limited amount of available resources. The beneficial cargo owners that belong to the Coalition for Responsible Transportation (CRT) are providing various types of financial aid to help get cleaner trucks on the road. The common denominator is that member shippers have negotiated higher rates with their carriers to cover the cost of upgrading to a clean-diesel fleet.
“The owner-operator doesn’t always have the financial resources to bear the cost alone of these new trucks. So we advocate that the trucking company and the cargo owner all have some skin in the game when it comes to the cost of these clean trucks,” CRT Executive Director James Jack said.
The EPA is helping ports deal with diesel emissions on a number of fronts beyond the SmartWay program through its National Clean Diesel Program, which helps deploy EPA certified technologies, competitive grants to foster development of innovative technologies and allocations to help states establish clean diesel programs.
Last summer the EPA’s Clean Ports program awarded a $3.3 million grant to a Mid-Atlantic consortium of local distribution centers and the ports of Philadelphia; Wilmington, Del.; Hampton Roads, Va.; and Baltimore.
In January, the Maryland Port Administration pitched in $300,000, doubling the available amount of money and launching its portion of the campaign, to help truck owners at the Port of Baltimore swap out their old rigs for 2007 or newer models. Each eligible truck can receive up to $20,000.
EPA funding is conditioned on showing a receipt that a scrap dealer has drilled a hole through the engine to ensure that the truck is not put back on the road, Jim Blubaugh, the EPA’s deputy division director in the Office of Transportation & Air Quality, said.
The Virginia Port Authority originally started its “Green Operator” program in 2007 to create an incentive for truckers to upgrade their fleets. It has successfully turned over 250 trucks, with another 50 trucks in the application pipeline, Heather Wood, director of environmental affairs, said.
Only the twin ports of Los Angeles and Long Beach, which mandated the phase out of trucks built before 2007 — when new EPA emission standards for heavy-duty trucks went into effect — and assessed a $35 fee on gate moves by trucks that didn’t have a compliant engine during the transition, have helped replace more short-haul trucks than Virginia. The aggressive approach taken by the Southern California ports resulted in thousands of trucks being replaced within four years. They exceeded their emission-reduction goals ahead of schedule, cutting sulfur oxides by 92 percent, particulate matter by 89 percent and nitrogen oxides by 77 percent from 2005 levels.
Truckers who use the Port of Virginia can get a rebate for $6,000 to retrofit their existing tractor with a particulate filter or $20,000 for a replacement vehicle.
There are about 2,700 trucks that operate in the Hampton Roads marine terminals.
The VPA used its own money to start the program and in 2009 tapped the EPA’s National Clean Diesel Program for $1.2 million, with the help of the state Department of Environmental Quality. The EPA funds, as in Baltimore, are administered by the Mid-Atlantic Regional Air Management Association (MARAMA). Virginia Clean Cities, a non-profit dedicated to promoting fuel efficiency and alternative fuels in transportation, works to spread word of the incentives in the trucking community. Woods said Green Operator (GO) is funded through 2017, with support in later years coming from the Department of Transportation’s Congestion Mitigation and Air Quality Improvement program.
Virginia Clean Cities says it is working to get shippers to contribute money so that GO can stand on its own without government aid.
The Mid-Atlantic Dray Truck Replacement Program in the Philadelphia-Wilmington area is on hold while the Clean Air Council, a local non-profit group that has sponsored several diesel emission control projects, raises local funds to pair with the EPA money, MARAMA Executive Director Susan Wierman said.
The Mid-Atlantic Dray Truck Replacement Program originally was supposed to provide $15,000 per truck. Wierman said the organization kicked up the contribution to $20,000 when it learned that banks were reluctant to offer loans because the down payment wasn’t big enough.
|“We advocate that the trucking company and the cargo owner all have some skin in the game when
it comes to the cost of these clean trucks.”
Coalition for Responsible Transportation
Meanwhile, South Carolina’s Port of Charleston last September launched its own voluntary program to help truckers replace pre-1994 tractors with less-polluting ones. Under the Seaport Truck Cleanup Southeast program, frequent port users can receive $5,000 towards the purchase of a 2004 or newer model.
Charleston is the first port in the South Atlantic region to have a truck replacement program.
There is $500,000 available in the first year, with half the money provided by the South Carolina State Ports Authority and the other half by the South Carolina Department of Health and Environmental Control using a state Clean Diesel grant from the EPA, SCSPA spokesman Allison Skipper said.
The SCSPA studied truck traffic at the port for a 12-month period and estimated that 20 percent of the 13,000 trucks that visit the Port of Charleston on a regular basis move 90 percent of the cargo. Of those that visited at least once a week, about 10 percent — 262 vehicles — were built before 1994.
The first-year goal is to get rid of 100 of the oldest tractors in the core drayage fleet. About a quarter of them have been, or are in the process of being, replaced, she said.
The port authority contracted with Cascades Sierra Solutions, a non-profit group based in Eugene, Ore., that specializes in helping independent drivers evaluate and finance equipment upgrades or new truck purchases and become SmartWay certified. Cascades Sierra acts as a matchmaker between small fleet owners, truck dealers, grant providers, lending institutions and scrap yards.
“The tack we’re taking is that this is a voluntary program that’s a benefit for the trucking community. If you think about it, a pre-1994 truck is probably not as fuel efficient and will need some heavy maintenance. So, knowing that it eventually will have to be replaced, here’s a financial incentive to get the ball rolling,” Skipper said.
The Port of Charleston also has an existing program to help motor carriers retrofit older engines so they pollute less and is upgrading the diesel engines on its cargo-lifting equipment. Skipper noted that the port authority is taking these steps even though Charleston’s air quality is relatively good compared to other metropolitan areas and is not mandated to achieve state or national clean air-standards.
The Port Authority of New York and New Jersey’s truck replacement program is a hybrid of the regulatory approach used at California ports and by voluntary truck replacement programs. As of Jan. 1, 2011, all trucks with 1993 model-year engines or older were banned from the port’s marine terminals. Truckers have until Jan. 1, 2017 to upgrade to clean-burning engines that meet 2007 or 2010 federal emission standards.
To speed up the process, the port authority is offering carriers a grant for those with a 1993, or older, truck that covers up to 25 percent of the purchase price of a truck with model year 2004 or newer engines, as well as low-interest financing for the balance, while funds last.
Since 2009, the PANYNJ has received $8.57 million in grant funding from the EPA to implement its program. The first tranche of $7 million helped replace 636 shuttle trucks. The second award will fund the replacement of 126 more vehicles.
The port also has a second program under which those seeking to replace 1994-2003 model-year trucks can receive low-interest financing (5.25 percent) and free retrofit equipment for 2004-2006 used trucks.
A year ago, the port authorities of Georgia, Virginia and South Carolina joined the Coalition for Responsible Transportation. The CRT includes importers, exporters, ocean carriers, and trucking companies seeking to develop partnerships between ports, service providers, and their customers to improve air quality around ports. The CRT has worked with the ports of Los Angeles, Long Beach, Seattle, Tacoma, Oakland and New York/New Jersey to implement their clean truck programs and help find resources for truckers to get advice, financing, lease-to-buy opportunities, pricing discounts from manufacturers and other assistance.
As a result of its efforts, the majority of clean trucks deployed in Southern California have been privately financed by the shipping industry, without public subsidies.
West Leads Way.
West Coast ports generally set stricter deadlines for converting fleets to more modern equipment. And the California Air Resources Board has ruled that pre-2007 trucks will not be allowed in any port or rail ramp, beginning January 2014.
As of Jan. 1, 2010, under CARB’s transition plan, 1993, or older, trucks were banned and trucks with engines for model years 1994 to 2003 must be retrofitted with a Level 3 diesel particulate filter to enter port facilities. The filter, which must be verified, cuts diesel emissions by 85 percent.
The filter requirement kicked in this year for trucks with 2004 engines. Trucks with 2005-06 engines can legally work at the ports through the end of 2012.
The suggested long-term solution is to switch to a truck with a 2007-09 model year engine, which is approved for use through 2022, or a 2010 engine that is fully compliant.
The ports of Los Angeles and Long Beach are far ahead of the state-wide standard.
The interim option begs the question of whether the pool of 4,000 independent drivers serving ports like Oakland will find it worthwhile to spend $15,000 to $25,000 for a retrofit device when they’ll have to upgrade in two years to a new truck anyway.
CARB requires owners to register dray trucks with the state and port authorities to report violations on a quarterly basis. The Port of Oakland took the added step of banning trucks from its marine terminals that didn’t meet the transitional emission requirements.
CARB is issuing citations to non-compliant trucks reported to it by ports.
Truckers can apply to the port for a one-time exception to pick up or deliver cargo with a non-compliant vehicle.
A study just completed by the University of California at Berkeley found a 50 percent decline in diesel particulate emissions from drayage trucks and a 40 percent decline in nitrogen oxide emissions in the port area following implementation of the clean-truck initiative.
The Oakland Port Authority, EPA and state and local air quality management boards provided $22 million grants for the retrofits, as well as replacement trucks.
GSC Logistics, a licensed motor carrier that provides warehousing and transportation services in the San Francisco Bay area, is an example of a CRT member that has taken the initiative to help its independent contractors retrofit or trade up to modern trucks.
The company approached major customers such as Wal-Green, “K” Line and J.C. Penney about contributing toward an $850,000 fund to help 100 drivers buy new trucks by accepting higher rates for each cargo trip, founder and Chairman Andy Garcia, told American Shipper
GSC, which also makes direct contributions to the in-house Truck Assistance Program, gives its outside drivers $4,000 to $7,000 for a newer tractor or retrofit. It hopes to convince more customers to participate in the effort so it can help about 125 drivers achieve compliance by the end of 2013.
But Garcia said there is no guarantee that an outsourced trucker that receives financial aid will continue to haul loads for GSC instead of a rival. That’s why it’s equally important to keep the drivers busy year round and ensure they average $2,300 per week — the minimum amount expected to keep them satisfied.
“The grant is fantastic help. But the real key beyond the grant is to make them financially viable week to week,” he said.
Driver turnover at GSC is about 10 percent a year because people leave the industry, decide to switch to interstate trucking or haul agricultural loads.
GSC can’t put a clause in the driver’s contracts stipulating a commitment period after receiving a donation because that would blur the line between an employee and an independent contractor, putting the company at risk that a court could find it responsible for wages and benefits, Garcia said.
The motor carrier also tries to make things easier for its drivers by negotiating preferential pricing with truck brokers in the Midwest for their old trade-ins, as well as the purchase of tractors built in 2007 or 2008. The deals cover seven to 14 tractors at a time to take advantage of bulk discounts. There is a market for tractors built in the mid-2000s because they perform well for farmers and there is less concern about concentration of diesel pollution in a non-metropolitan area, Garcia said.
“These negotiations on price and trade-in value are totally at arm’s length. We don’t want to be an agent. We only work out the values and then we refer the owner-operator to the dealers” to work out their own arrangements, he said.
At the ports of Seattle and Tacoma, all trucks built prior to 1994 were prohibited from entering container terminals. By the end of 2015, 80 percent of trucks serving the port must comply with the 2007 truck emission standard and all trucks must do so by 2017.
The Port of Seattle contributed $2.3 million to the Puget Sound Clean Air Agency to support a buy-back program for pre-1994 trucks. Truck owners receive $5,000 or fair market value, whichever is greater, for their trucks.
West Coast ports require companies to register their trucks to help monitor compliance. The Port of Seattle plans to graduate from its Green Gateway sticker to radio frequency identification tags in 2012 to verify which trucks are following the rules.
The Port of Tacoma says its market-based approach of encouraging truck fleets to follow environmental best-practices, and publicly promoting those that meet the standards, led to a 4 percent increase in both 2009 and 2010 in the number of trucks with 1994 or newer engines. In 2010, 8 percent of the trucks met the EPA’s 2007 emission standard. The City of Tacoma, in partnership with Cascades Sierra, offers truck owners $5,000 to replace a pre-1994 truck with one between 1994 and 2006, and $30,000 for a 2007 or newer tractor through its Tacoma Truck Scrappage and Replacements for Air in Puget Sound, or ScRAPS, program.
Although voluntary truck-replacement programs have nibbled at the problem of dirty trucks, the main culprits in ports when it comes to diesel emissions are the vessels themselves.
The Port of Tacoma, for example, says an air pollution inventory conducted in 2005 found that drayage trucks produce only 1 percent of diesel emissions at the port and 0.00002 percent of all diesel emissions in the Puget Sound area.
Many ports are using a variety of techniques to minimize smokestack emissions, such as slowing vessels on approach and building plug-in shore power to run auxiliary systems while a vessel is at berth.
Another approach is encouraging vessel operators to switch to a cleaner fuel while entering the harbor or at berth.
In February, the VPA expanded the GO program to the water side by offering incentives for ocean carriers that burn low-sulfur fuel while vessels idle at the Port of Virginia. Shipping giant Maersk was the first to take advantage of the deal, which will provide it $300,000 over 13 months to help cover the differential cost between traditional bunker fuel and low-sulfur diesel fuel.