1. 1 California Environmental Protection Agency Air Resources Board November 21, 2013 Coast Guard Island Alameda, CA Deep Draft Industry Ocean-Going Vessel Clean Fuel Regulation

2. 2 What is the Air Resources Board? The state agency charged with: Coordinating efforts to attain and maintain ambient air quality standards Conducting research into the causes of, and solution to, air pollution Monitoring and regulating the sources, and reducing the emissions of gases, that cause climate change (Adapted in part from Section 39003 of the Health and Safety Code. )

3. 3 What is the Air Resources Board? (cont.) The Mission: To promote and protect public health and ecological resources through the reduction of air pollutants while recognizing and considering the effects on the economy of the state. The Goals : Provide Safe, Clean Air to All Californians Protect the Public from Exposure to Toxic Air Contaminants Reduce California's Emission of Greenhouse Gases Base Decisions on Best Possible Scientific and Economic Information Provide Quality Customer Service to All ARB Clients

4. 4 Railroad and Marine Enforcement Section (RMES) RMES Regulatory Enforcement: Commercial Harbor Craft Cargo Handling Equipment Ocean-Going Vessels Transportation Refrigeration Units Railroad Memorandum of Understanding Marina Fuels

5. 5 Commercial Harbor Craft (CHC) Vessel Types Inspected: Tug Tow Work Crew Supply Commercial Fishing Barge Dredge Excursion

6. 6 Cargo Handling Equipment (CHE) Equipment Inspected: Top Pick Lifts Side Pick Lifts Forklifts Yard Trucks Rubber-Tired Gantry

7. 7 Ocean Going Vessels (OGV) Equipment Inspected: Boilers Main Engines Generators Shore Power

8. 8 Transportation Refrigeration Units (TRU) Equipment Inspected: TRU Gen-sets Located at ports and rail yards Verifying compliant labeling and engine MY

9. 9 Railroad Memorandum of Understanding (MOU) Equipment Inspected: Locomotives Focused on: Idle Reduction Devices (IRD) Visible Emissions Excessive Idling Fuel Sulfur content

10. 10 Marina Fuels Program Staff collect diesel fuel samples at California fuel docks Samples are analyzed for sulfur and aromatics All known diesel fuel docks are inspected annually

11. 11 The Ports of California RMES inspects state-wide San Diego Los Angeles Long Beach Hueneme San Francisco Oakland

12. 12 Overview Ocean-Going Vessel Regulation Background and Status Implementation Activities 2012 Amendments Contacts

13. 13 Background and Status

14. 14 8 years in development Consultative process Adopted by ARB in July 2008 Implementation began July 2009 Provided immediate and significant emissions reductions Diesel PM: 83% reduction SOx: 96% reduction NOx: 6% reduction Established a bridge to ECA in 2015 Californias Ocean-Going Vessel Clean Fuel Regulation

15. 15 Clean Fuel Requirements Require the use of cleaner fuels within a 24 nautical mile zone of the California coastline July 1, 2009 –Marine gas oil (1.5%), –Marine diesel oil (0.5%) August 1, 2012 –Marine gas oil (1.0%) –Marine diesel oil (0.5%) January 1, 2014 –Marine gas oil (0.1%) –Marine diesel oil (0.1%)

16. 16 Regulation Provides a Safety Exemption Safety exemption applies if –The Master determines that compliance would endanger the safety of the vessel, crew, cargo, or passengers –Due to severe weather conditions, equipment failure, fuel contamination, or other extraordinary reasons beyond the Masters reasonable control Safety exemption applies only as long and to the extent necessary to secure safety –Master takes all reasonable precautions after the incident to avoid or minimize repeated claims of exemption –Master notifies ARB of a safety exemption claim within 24 hours and submits documentation to establish conditions within four working days after incident ends

17. 17 Regulation Provides an Essential Modifications Exemption This provision is granted when vessel operators/owners demonstrate that they cannot meet the fuel requirements without essential modifications to the vessel –Regulation provides a definition of an Essential Modification –Exemption is granted by ARB based on a demonstration of need –Vessels must meet operational requirements of exemption

18. 18 Regulation Provides Noncompliance Fee Provision Option to Pay Noncompliance Fee Reasons beyond vessel Masters control –unexpected redirection to a California port –inability to purchase complying fuel –fuel found to be noncompliant en route to California Extension needed for vessel modifications Vessel modifications needed on infrequent visitor

19. 19 Implementation Activities Add picture

20. 20 ~21,000 vessel calls since regulation began in July 2009 ARB inspectors board vessels at dockside –fuel samples collected for testing and analysis –records and fuel switching procedures reviewed –review incineration records –review cold ironing records (2014) Over 550 inspections since July 1, 2009* –~95% compliance Most notices of violation involve fuel switching within regulated zone *Summary from July 1, 2009 to October 31, 2013 Enforcement and Compliance Status

21. 21 * Summary from July 1, 2009 to October 31, 2013 Use of Provisions in Regulation Facilitates Implementation Safety exemption used 88 times Noncompliance fees paid 5 times Essential Modifications Exemptions –majority of applications are for auxiliary boilers –438 exemptions provided for vessels that demonstrated the need for essential modifications

22. 22 Outreach Efforts to Support Implementation Six advisories issued –Five in 2011 –One in 2012 –Advisories are used to update and clarify regulatory language and changes thereof –Many also include forms and maps –Info can be found at arb.ca.gov/marine

23. 23 2012 Amendments

24. 24 2012 Amendments Extension of Regulated California Waters in Southern California Advantages of the revised implementation date of 0.1% sulfur fuel to January 1, 2014 Changes to the Noncompliance Fee Provision

25. 25 Extended Clean Fuel Zone

26. 26 Facilitates continued high compliance rate and a successful transition to 0.1% fuels –Provided industry with additional lead time between implementation of ECA Phase 1 (1% to ~200 nm) and ARBs Phase 2 (0.1%) –Lessened any near term, port specific availability issues with 0.1% fuel –Provided shippers more flexibility in purchasing higher viscosity compliant distillate –Provides additional time for fuels meeting the new ISO 8217 fuel specification to penetrate the market Advantages of Delaying Phase 2

27. 27 Fee halved when a vessel purchases and uses compliant fuel during noncompliant California port visit Fee for second noncompliant port visit reduced from $91,000 to $45,500 (same as for first port visit) Anchorage conducted in conjunction with a port visit not counted as a second port visit Changes to Noncompliance Fee Provision

28. 28 RMES 2014 Activities Begin Shore Power (Cold Ironing) inspections Enforce the 0.1% sulfur limit Inspecting Commercial Harbor Craft for 2014 engine requirements Continue with the following inspections: Cargo Handling Transportation Refrigeration Unit Rail Road MOU Marina Fuels

29. 29 Tim Gergen (Staff) (916) 445-0292 tgergen@arb.ca.gov Robert Hamamoto (Staff) (916) 324-6972 rhamamot@arb.ca.gov Richard Smith (Manager) (916) 445-1295 rcsmith@arb.ca.gov Mark Stover (Branch Chief) (916) 322-2056 mstover@arb.ca.gov http://www.arb.ca.gov/marine Contact Information