1 2 3 4 5 6 7 8 9 10 PUBLIC HEARING REGARDING 11 PROPOSED HEAVY-DUTY ENGINE AND VEHICLE STANDARDS 12 AND HIGHWAY DIESEL FUEL SULFUR CONTROL REQUIREMENTS 13 14 LOS ANGELES, CALIFORNIA 15 16 17 JUNE 27, 2000 18 19 10:20 A.M. 20 21 22 23 24 25 1 1 PANEL MEMBERS 2 3 MARGO OGE, PRESIDING OFFICER 4 5 DEBORAH JORDAN, AIR DIVISION DIRECTOR OF EPA'S 6 REGIONAL OFFICE IN CALIFORNIA 7 8 DAWN MARTIN, CHIEF OF STAFF OF EPA'S OFFICE OF AIR AND 9 RADIATION 10 11 CHET FRANCE, DIRECTOR OF THE ASSESSMENT AND STANDARDS 12 DIVISION 13 14 MICHAEL HOROWITZ, OFFICE OF THE GENERAL COUNCIL 15 16 ROBIN MORIN 17 18 19 20 21 22 23 24 25 2 1 I N D E X 2 3 SPEAKERS: PAGE: 4 5 ALAN LLOYD 13 6 NANCY SUTLEY 18 7 WILLIAM FRICK 23 8 MICHAEL WALSH 30 9 STEPHANIE WILLIAMS 38 10 ALBERT COHEN 43 11 LARRY BARRON 45 12 VALERIE LIESE 58 13 DAVID BERRY 59 14 JOE NIEYEZ 60 15 ROBERTA BARBALACE 62 16 ALBERT NUNES 65 17 FRANK SMITH 67 18 JUDY FOGEL 68 19 REYNA VASQUEZ 73 20 CHERYL LOVE-QUEEN 74 21 RICHARD BARBERS 76 22 DAVE FREEMAN 79 23 CHUNG LIU 81 24 SCOTT SHERMAN 87 25 ANGELO BELLOMO 89 3 1 SPEAKERS (Continued): PAGE: 2 3 RICHARD SHYU 91 4 MR. LEGRE 95 5 JULIE MASTERS 99 6 GAIL RUDERMAN 102 7 NADINE GARCIA 106 8 BRUCE BERTELSEN 108 9 JOHN MOONEY 112 10 GARY HERWICK 113 11 GLENN KELLER 114 12 TERRY VAN HOOK 123 13 BAHRAM FAZELI 129 14 RON MILAN 131 15 DR. DRAY 133 16 NINA SOLOMON 134 17 GREG VLASEK 135 18 SILENE PARAMEDEZ 141 19 ERASMO FUENTES 141 20 JULIA MUNOZ 142 21 CRAIG MOYER 144 22 CHAD TUTTLE 150 23 DUANE BORDVICK 155 24 AL CABODI 159 25 GARY HERBERTSON 166 4 1 SPEAKERS (Continued): PAGE: 2 3 STEVE FARKAS 168 4 CLARA ROSENTHAL 172 5 DAN JACOBSON 175 6 TODD CAMPBELL 177 7 ANGIE FARLEIGH 185 8 DAVID BARTLETT 190 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 5 1 PROCEEDINGS 2 3 MS. JORDAN: Good morning. Welcome to today's 4 public hearing. I am Deborah Jordan, acting director of 5 the Air Division of the San Francisco office of the 6 Environmental Protection Agency. We are here to receive 7 comments on a proposal for more stringent emission 8 standards for heavy-duty trucks and buses and new standards 9 for highway diesel fuel. 10 Today we will briefly present the Agency's 11 proposed action. Most importantly, we will hear your ideas 12 and concerns about efforts to reduce emissions from these 13 mobile sources. There has been great progress in local, 14 state and federal efforts to control harmful levels of 15 ozone in recent years. Yet the Western United States 16 continues to experience some of the most serious remaining 17 ozone and particulate matter problems in the country. 18 This is reflected not only in the South Coast 19 but also in areas like the San Joaquin Valley, the 20 Sacramento Valley and Southeast Desert, where air pollution 21 levels have not been declining significantly over the past 22 half dozen years. In these areas almost 5 million 23 residents are exposed to pollution levels that can cause or 24 contribute to asthma, acute respiratory problems, decreased 25 lung function and impaired immune systems. California's 6 1 Central Valley is also our nation's agricultural backbone, 2 and the continuing smog problems there inhibit 3 photosynthesis and suppress growth of crops and trees, 4 causing our economy millions of dollars. 5 We need to ensure that we continue to apply 6 rigorous controls to industrial and commercial pollution 7 sources. However, our remaining pollution problems are 8 increasingly dominated by mobile sources. And with the 9 continued rapid growth in vehicle use in the West, we 10 believe that stringent motor vehicle controls are needed. 11 I now would like to introduce Margo Oge, 12 Director of EPA's Office of Transportation and Air Quality, 13 who will provide an overview of the proposal, and will 14 describe the ground rules for the hearing. 15 MS. OGE: Good morning. On behalf of the 16 Environmental Protection Agency, welcome to today's hearing 17 and thank you for coming. I am Margo Oge, director of 18 EPA's Office of Transportation and Air Quality. I will 19 serve as the presiding officer for today's hearing. Today 20 we will hear testimony on EPA's proposed rulemaking for 21 cleaner trucks and buses and cleaner diesel fuel. 22 This is a historic proposal. This proposed 23 program will achieve a dramatic reduction in air pollution 24 in the 21st Century. 25 Last year we established a new program, called 7 1 tier two, to dramatically reduce emissions from cars and 2 light-duty trucks, SUVs, minivans, and pickup trucks. We 3 are now focusing much needed attention on heavy-duty trucks 4 and buses applying the same principles of addressing the 5 vehicles and the fuel as a single system. 6 This proposed program would protect the public 7 health and the environment of all Americans by reducing the 8 sulfur content in highway diesel fuel by 97 percent to 9 provide the cleanest diesel trucks and buses in history. 10 This means that for the first time ever, 11 heavy-duty trucks and buses would be able to use pollution- 12 control devices to meet emission standards. Just as 13 passenger cars have been doing for the last 25 years. 14 These devises are sensitive to sulfur and will 15 not work unless the amount of sulfur in the fuel is 16 dramatically reduced. 17 Heavy-duty trucks and buses are largely 18 powered by diesel engines. Diesel engines are more durable 19 and get higher fuel economy than gasoline engines, but they 20 also tend to pollute more. 21 More than 100 million people live in areas 22 with unhealthy air quality. For example, here in Los 23 Angeles heavy-duty trucks and buses contribute more than a 24 quarter of the NOx pollution and 14 percent of the PM 25 pollution from mobile sources 8 1 This pollution causes lung damage and 2 respiratory problems, and there is increasing evidence that 3 diesel exhaust may cause lung cancer in humans. 4 The proposed program would have a substantial 5 impact on these emissions. It is the clean air equivalent 6 of removing from air pollution generates by 13 million of 7 today's trucks. 8 In 2007 we are proposing a particulate matter 9 emission standard for new heavy-duty engines of 0.01 grams 10 per brake-horsepower-hour. This is a 90 percent reduction 11 from today's standard. These standards would begin in 2007 12 and be fully phased in in 2010. 13 We're proposing standards for NOx of 0.20 14 grams per brake-horsepower-hour, a 95 percent reduction 15 from the current standard and we are proposing that, in mid 16 2006, sulfur levels in diesel fuel be limited to 15 parts 17 per million. This is a 97 percent cut from the current 18 highway diesel fuel sulfur limit of 500 parts per million. 19 We estimate that the cost to produce and 20 distribute the low sulfur diesel fuel will be about four 21 and a half cents per gallon. 22 We estimate that vehicle costs would increase 23 about $1,000 to $1,600, depending on the size of the 24 vehicle. We designed this proposed program to include 25 significant lead time for the introduction of new, cleaner 9 1 fuel into the marketplace. 2 The proposal also discusses various flexible 3 phase-in approaches for the diesel fuel industry, including 4 potential provisions to address special needs of small 5 refiners and farmer cooperative refiners. For engine 6 manufacturers, the proposed program allows phase-in of the 7 new engine standards over four years, from 2007 to 2010. 8 Before we start with today's testimony, I will 9 introduce the EPA panel and describe how we will conduct 10 this hearing. With me on the panel today are Deborah 11 Jordan, Air Division Director of EPA's regional office here 12 in California. Dawn Martin, Chief of Staff of EPA's Office 13 of Air and Radiation. Chet France, Director of the 14 Assessment and Standards Division. Michael Horowitz, from 15 the Office of General Council. 16 This is one of five public hearings on the 17 proposal. We expect to hear testimony from witnesses 18 offering a broad range of perspectives. 19 Please keep in mind that, in addition to the 20 opportunity for oral comment at these hearings, the comment 21 period will remain open until August 14 to allow for 22 written comments. 23 We are conducting the hearing in accordance 24 with section 307-D5 of the clean air act, which requires 25 EPA to provide interested persons with an opportunity for 10 1 oral presentation of data, in addition to an opportunity to 2 make written submissions. 3 Today we expect a large number of people. We 4 will do our best to keep the process going slowly wanted we 5 will ask you for you help. So that everybody that is here 6 to testify has the opportunity to do so, I would ask that 7 you to keep your comments to the maximum of ten minutes. 8 If you can do better than that we greatly appreciate it. 9 If you are testifying -- Mike, standup -- 10 there is Mike. Mike is an important person to help us move 11 the process forward. He is sitting here on the front row 12 and he will help you keep track of your time by signaling 13 you before your ten minutes. Please follow his direction. 14 Because of the large number of witnesses who 15 will testify today, this hearing may go to the evening 16 hours, and we will work through lunch and dinner. 17 I will conduct this hearing informally. We 18 request that witnesses write their name and affiliation 19 prior to making their statement. Please write your name 20 clearly on the paper provided and place it in front of you. 21 When a witness has finished her or her oral presentation, 22 the members of this panel may ask questions. I would like 23 to remind the witnesses that any false statement or false 24 response to questions may be a violation of the law. 25 If there are any members of the audience that 11 1 wish to testify and they have not signed up, I would ask 2 you to please sign your name with the receptionist outside. 3 I would also ask that all of you, even if you are not 4 testifying today, please sign in at the desk. 5 We are glad to see the court reporter 6 arriving. Welcome. We were getting a little concerned a 7 few minutes ago. If you would like a transcript of this 8 proceeding, you should make arrangements directly with the 9 court reporter during one of the breaks. 10 Also, I would like to let you know that all 11 the material, the transcripts of the hearing today, will be 12 available in the docket shortly after we are done with 13 these public hearings. 14 Before we start with the first panel, we want 15 to know if there are any questions. If not, I would ask 16 the first panel to take a seat. We will start with the 17 first panel today. 18 I will ask for Mr. Alan Lloyd to please come 19 forward. Mr. Bill Frick, Mr. Michael Walsh, Ms. Stephanie 20 Williams, Reverand Al Cohen and Mr. Larry Barron. Please 21 print the names on the card in front of you. 22 Mr. Lloyd, let me ask you a clarification 23 question. Are you testifying for the California Air 24 Resources Board and STAPPA/ALAPCO. 25 MR. LLOYD: Yes. I would like to give some 12 1 time to ALAPCO. 2 MS. OGE: That would be fine. Michael will 3 provide additional time to Nancy Sutley to help out with 4 Mr. Lloyd. 5 MR. LLOYD: I think this is keeping with your 6 statement, you want to proceed. 7 MS. OGE: Thank you. Welcome and good morning. 8 MR. LLOYD: Good morning, Madam Chairman. 9 Again, I am very pleased to be here with my colleague, 10 Nancy Sutley, Deputy Secretary of the California EPA. I am 11 Chairman for the California Air Resources Board and STAPPA 12 and ALAPCO. I want to congratulate EPA on a major step 13 forward and I am delighted to be working with you and your 14 staff on this national problem because it is critical for 15 us in California to balance the environment energy and in 16 fact economic goals. I also wanted to say some words on 17 behalf of STAPPA/ALAPCO. 18 As some background, the first slide indicates 19 to us why, in fact, the most important source of remaining 20 emissions are from diesel engines. You can see this will 21 be for 50 percent of the NOx emissions in 2010. That's a 22 major amount into the ozone as well as some of the 23 secondary formation. If you look also at how that's 24 partitioned, you have 45 percent of these emissions from 25 onroad diesels but 55 percent from offroad diesels. I will 13 1 say some more about that later. 2 I think, as you all know, our concern for 3 protecting public health stems from the fact that the Air 4 Board identified diesel exhaust particulate as a toxic air 5 contaminant in 1998, and from that stemmed a whole bunch of 6 activity to clean up diesel exhaust. 7 Based on a recent risk management work here, 8 our staff estimates that these particulates account for 9 roughly 70 percent of the cancer risks statewide. These 10 are consistent with the numbers at South Coast. Our top 11 priority is to reduce diesel emissions from NOx as a 12 particulate. We are delighted to see the govenor's 13 leadership in this area where he is proposing $50 million 14 to clean up emission from school buses. 15 We also have the Carl Myer's program, which is 16 another 50 million on a voluntary basis, and also the 17 governor has 50 million to address in the congestion 18 management, which we are looking at. 19 In fact, we have a major commitment here, not 20 only to protect public health but to move ahead with these 21 programs to clean this up. Also, I must say, having just 22 returned from a trip to EMA and several of the heavy-duty 23 manufacturers, I am, in fact, impressed by the spirit here 24 of addressing the problem to clean it up and maybe rather 25 than fighting about this we are moving ahead to address it 14 1 so we can reduce these emissions and keep diesel in the 2 next year. 3 I would like to specifically comment on six 4 topics. The heavy-duty engine standards, diesel fuel 5 sulfur. I guess I don't need to read these. I will go 6 directly to them here. You can see the next graph shows 7 where we are and where we are going to, and you can see 8 major reductions in NOx, which is a dual role, role on 9 precursor and as well as fine particle precursor as well. 10 You have the particulate standard and nonmethane 11 hydrocarbon, which is not a major issue but is important as 12 well. 13 You can see the next slide the numbers that 14 are being proposed are identical to those already adopted 15 for the California transit buses earlier this year. ARB 16 supports the proposed NOx, PM and hydrocabron standards 17 strongly. We would suggest you have a more stringent 18 formaldehyde standard, as a point of one. 19 We had put in our transit bus rule it is not a 20 major issue. Obviously formaldehyde is a potential 21 carcinogen as well as a precursor to ozone and other 22 things. If you look at the implemention in the next 23 overhead, I think our recommendation there is that we 24 support the full PM standard implementation 2007. 25 We feel that the more aggressive three-year 15 1 plan should be adopted, that is 25 percent in model year 2 2007, 75 percent in model year 2008, and 100 percent in 3 model year 2009. What that would result in is an almost 20 4 percent in 2010. We feel that that is doable and necessary 5 to meet our requirements in California. 6 If we look at the sulfur limits, obviously we 7 strongly support that as we did with our transit bus rule. 8 We support the nationwide 15 ppm sulfur standard and full 9 implemention on June 1, 2006. We are hoping in California 10 maybe we can work cooperatively to reduce that number. 11 Again, it is a great pleasure today, one of 12 the first times I have Stephanie Williams from the 13 California Trucking Association sitting side-by-side and we 14 are going to battle side-by-side, in fact, on this issue. 15 It is a real delight and hopefully it is a sign of the 16 times. 17 I think, again, I wouldn't say I would define 18 this low sulfur fuel should be for offroad engines in the 19 same time frame. Clearly, I think we are committed to do 20 that. In terms of not to exceed the 1.25 federal test 21 proceeding emission standards from 55 to 95. We agree with 22 that. 1.25 multiplier. We understand the need for that. 23 However, we also recognize you can get above 24 95. We think we can go to 105. That's particularly true 25 when you get in times of high ozone and the San Joaquin 16 1 Valley where 95 may be a cool day. 2 As we look at the crank case we feel that 3 proposal to eliminate the exemption which allowed crank 4 from two diesel engines, we support that exception very 5 strongly. The combined dates we think could be moved up to 6 two years to model 2005 engines resulting in reduction of 7 toxic diesel particulates. We have a major focus, as we 8 see coming before the Board in September of this year on 9 that focus. 10 Anything that you can do to help us out there 11 is going to be much appreciated. We also like the idea of 12 enduring existing innovative technologies. We really like 13 your Blue Sky program. We think that's very important to 14 be cooperative within the industry. 15 We have a couple of suggestions there of how 16 you quantify that. That you could require certified 17 emissions to be no more than 50 percent of emission 18 standards as one way, or you can look at early phase as 19 another way of trying to encourage that. Both of those 20 were from technology. 21 We also support the Allerton Banking and 22 Trading Program because it provides flexibility and it 23 encourages the use of advanced technology. 24 In summary, I think the proposal will result 25 in significant emission reductions and we strongly support 17 1 the proposed rule that suggests strengthening in several 2 areas. We feel that the key to success is the 15 ppm 3 diesel fuel sulfur phased in in 2006. We feel that gives 4 adequate time for gearing up to that area. If we look at 5 the rest of the world we can see the train going to low 6 sulfur fuel. We feel this is critical for the 7 aftertreatment and, in fact, to keep diesel in the mix 8 there. This is very important. 9 Hopefully we can work with our colleagues in 10 California to accelerate that program to help us there. We 11 also feel it is very important to extend that 15 ppm sulfur 12 limit to offroad vehicles. 55 percent of the NOx is due to 13 offroad. That's a very important aspect of that. 14 That officially concludes my statement on 15 behalf of the Resources board. I would like to -- maybe 16 what I will do is turn it over to the secretary here to 17 make comments and I will come back. 18 MS. SUTLEY: Thank you, Alan. Good morning. 19 I am Nancy Sutley, Deputy Secretary to the California 20 Environmental Protection Agency on the behalf of the State 21 of California. I would like to welcome you to Los Angeles 22 and express our appreciation for you coming here to hear 23 from us directly about an issue of great importance as to 24 all Californians. I am going to echo a lot of what Alan 25 said, but let me start by describing the California 18 1 Environmental Protection Agency. 2 We oversee six state agencies, including the 3 Air Resources Board, the Department of Pesticide 4 Regulations, Department of Toxic Substance Control, Office 5 of Environmental Health Assessment and State Resources 6 Control Board and Waste Management Board. 7 California's Environmental Protection Agency 8 is the environmental organization responsible for 9 overseeing these agencies and to improve environmental 10 quality to protect public health and the welfare of our 11 citizens. I am pleased to be here to offer our comments in 12 support of U.S. EPA's proposed rule. 13 I wanted to talk briefly, as Alan did, about 14 the importance of reducing diesel emissions to public 15 health in California. As you can see from the slide, over 16 50 percent of the ozone precursor emissions from man-made 17 sources in California are from local sources. The top two 18 pie charts illustrate the projected percentage of mobile 19 source emissions in the South Coast air base in 2010. 20 As you can see for both the reactive organic 21 gases and the oxides of nitrogen, that onroad heavy-duty 22 vehicles account for a large proportion of the total mobile 23 source inventory. You can also see that there's a large 24 contribution of offroad diesel emissions. If you add 25 together the on- and offroad diesel emissions in 19 1 conjunction with the existing emission standards, you can 2 see that these will contribute to a significant level of 3 reactive organic causes and NOx inventories here in 4 California. 5 The bottom pie chart shows the distribution of 6 heavy-duty vehicles to diesel particulate matter that 7 onroad engines account for about a quarter of those 8 emissions and offroad engines account for about 75 percent. 9 Diesel particulate matter is responsible for about 70 10 percent of the known airborne toxic risk. It is clear in 11 California heavy-duty emissions are a major part of the 12 emissions inventory and toxic risks and additional 13 reduction are needed. Reducing diesel emissions is the top 14 priority for the California EPA and the Governor. 15 Just to make some brief comments, California 16 EPA supports the reduced NOx, PM and formaldehyde standards 17 consistent with ARB's comments. California EPA is strongly 18 supportive of the proposal of the diesel fuel and 19 California EPA encourages the EPA to extend the proposed 20 onroad, low sulfur diesel fuel to onroad applications. 21 Let me just conclude by saying that we would 22 like to emphasize the importance of the proposed fuel 23 diesel sulfur standards with the significant amount of 24 oxides and nitrogen and particulate matter emissions that 25 can be reduced by new aftertreatment technologies. It is 20 1 imperative that the standard be approved as proposed. In 2 doing so, U.S. EPA will help protect the health not only of 3 all Californians but everybody in the United States. 4 MS. OGE: I would like to thank you both, 5 Mr. Lloyd and Ms. Sutley, for your testimony and welcome 6 Mr. Bill Frick. Good morning. Mr. Frick, just one second, 7 please. Mr. Lloyd. 8 MR. LLOYD: I think Mr. Becker has 9 a short presentation. 10 MS. OGE: You have one more testimony. Please 11 go ahead. 12 MR. LLOYD: I will go ahead. 13 MS. OGE: Let's give Mr. Lloyd ten minutes or 14 less. 15 MR. LLOYD: I will take less. What I would 16 like to do, I am appearing in this case on behalf of 17 STAPPA, which represents air quality agencies, including 18 Air Resource Board of the States and on behalf of ALAPCO, 19 Association of Local Air Pollution Officials, which 20 represents air quality agencies, more than 150 major 21 metropolitan areas nationwide. I am pleased to have this 22 opportunity to provide associations task on EPA recent 23 proposal to set more stringent emissions standards for 24 onroad emissions on all sulfur onroad diesel fuel. 25 What I would like to do is read the major part 21 1 of this into the record. You can use that for the written 2 testimony and put it into the record. I would like to pull 3 a few highlights here. 4 On behalf of STAPPA and ALAPCO we would like 5 to comment for its continued leadership your promulgation 6 on last December due to motor vehicle emission standards 7 and the national low gas program, which are a remarkable 8 accomplishment to the benefit of the entire country. This 9 month's heavy-duty engine and low sulfur diesel fuel 10 further demonstrates the Agency's committment to 11 efficiently and cost-effectively produce a wide variety of 12 mobile source-related emissions to achieve meaningful 13 movement in air quality across the nation. 14 We applaud in this initiative and the system 15 which addresses both the engine and the fuel upon which 16 this is based. I think what I would like to do is to skip, 17 in fact, to the last overhead there which highlights the 18 major points that we support STAPPA/ALAPCO. This is of 19 vital importance nationwide. 20 As indicated before, the emissions from 21 heavy-duty diesel engines bring with them adverse health 22 defects. These are responsible for 125,000 cancers over a 23 life time. Again, this is the STAPPA/ALAPCO estimate. We 24 strongly endorse the emission standards the EPA has 25 employed and the ability to comply with the standards are 22 1 dependent upon the availability of ultra-low sulfur diesel 2 fuel. I would say low sulfur diesel as a personal opinion. 3 We vigorously support the proposed 15 ppm cap. 4 We also recommend the adoption of similar engine standards 5 and sulfur cap offroad heavy-duty diesel vehicles. That's 6 similar to my comments earlier. 7 In the coming weeks STAPPA/ALAPCO will more 8 fully propose comments on the diesel engine rates. STAPPA 9 and ALAPCO looks forward to working closely with the Agency 10 as it continues to define this extremely important program 11 on behalf of our association our continued cooperation and 12 partnership as you move ahead. 13 Again, I would like to reiterate and again 14 congratulate you and your staff on a lot of the work and 15 the leadership you show and we are delighted to be working 16 with on you this program. 17 MS. OGE: Thank you. Mr. Frick. Good 18 morning. 19 MR. FRICK: Good morning. My name is Bill 20 Frick. I am vice president and general counsel and 21 secretary of the American Petroleum Institute, a national 22 trade association representing all aspects of the petroleum 23 industry, exploration, production, refining, transportation 24 and marketing. We appreciate the opportunity to 25 participate in this. 23 1 Our members will be obviously significantly 2 effected by this rulemaking and we have submitted a 3 statement for the record. I would like this morning to 4 emphasize five points for the panel and for the audience. 5 First of all, this industry is not opposed to 6 reductions in sulfur. We concur it will benefit air 7 quality. We came forth when EPA began discussing it. A 8 proposed to them a 90-percent reduction in sulfur in 9 diesel, which was EPA's original objective. Sulfur levels 10 are going to come down. The issue is how fast and how far. 11 Two. In considering how fast and how far, we 12 want the Agency to take into consideration that the 13 industry is facing some significant daunting challenges at 14 its refineries. This rule cannot be looked at in 15 isolation. We have got to look at all the other issues 16 that are facing the fuel system that is the part of the 17 nations economy and to the consuming public. 18 Currently we are facing significant reduction 19 in gasoline sulfur. Then, at this rulemaking there are a 20 number of boutique fuels that have been created throughout 21 the country in order to meet a number of clean air 22 requirements, reducing MTVE, and California knows this. 23 To the extent that oxygenation continues to 24 be required, the use of ethanol represents significant 25 logistic and handling issues for the industry. There 24 1 will be very toxic regulations, face new source review 2 regulations, and finally the unical patent is also putting 3 a strain on the system as to how members prepare this mix 4 of fuels that we now have. 5 Each of these affects the constituents of 6 fuel. Whether it is gasoline or diesel. Each of these 7 requirements does that. It affects the amounts that can be 8 reduced at refineries. This patchwork of fuels is very, 9 very challenging to our industry. It is not just three 10 grades that are on the pump when people go to a gas 11 station. We now have at least ten areas in the country 12 with different formulations. 13 This puts a strain on all parts of the chain, 14 both production and also transportation and marketing. It 15 also as we make all these changes we are soaking up capital 16 in a segment with very low return on capital. It is also 17 a challenge to find the resources to install all of the 18 equipment that is going to be necessary as we do all of 19 this to make the changes necessary to comply with this mix 20 of requirements. Finally, as I have said, the different 21 formulations put a strain on all parts of the chain of 22 relation of these fuels. 23 There's a recent National Petroleum Council 24 study. It is a group of industry and government officials 25 in response to requests of the Department of Energy asked 25 1 to look at refining capacity given all these requirements. 2 DOE and EPA participated in that. 3 That studies confirms the concerns that I have 4 addressed here. "The National Joint Council concludes 5 that the refining and distribution industry will be 6 significantly challenged to meet the increasing domestic 7 product demand with the substantial changes in fuel quality 8 specifications recently promulgated and currently being 9 considered. 10 The timing and size of the necessary refining 11 and distribution investments to reduce sulfur and 12 gasoline and diesel, eliminate MTVE, and make other product 13 specification changes, such as reducing toxic emission from 14 vehicles are unprecedented in the petroleum industry." 15 The effect of all this is taking flexibility 16 out of the sytem. Some of the recent concerns in the upper 17 Midwest, where the prices have gotten much higher, is due 18 to the inflexibility of the system when slight 19 interruptions take place. 20 The third point I would like to make is that 21 I am speaking here on behalf of the entire industry. There 22 are some companies, some refineries, which can make the 23 fuel that EPA has proposed. However, the costs, we 24 believe, are much higher than EPA estimates. They estimate 25 4 billion. We think it is closer to 8 billion. That comes 26 1 on top of the 4 billion necessary to make the gasoline 2 sulfur reductions. 3 There is also a significant ramp-up in cost as 4 you move from the 50 we propose to the 15 that the EPA has 5 proposed. It is not a straight line but rather a step up. 6 The NPC study that I mentioned earlier confirms what I said 7 again about the strain on the system. 8 "There is a significant risk of inadequate 9 supplies should on-highway diesel sulfur levels below 30 10 ppm be mandated." This may be less of a challenge in 11 California which has severe requirements currently. 12 When you look at the entire country, that is 13 what we are concerned about. This is a nationwide rule. 14 We see a different story. In some cases there may be some 15 refineries that will not make this fuel. They will not be 16 able to justify the investment given their product slate in 17 the market. That will tighten potential supplies in low 18 sulfur. 19 There are already many fewer refineries than 20 there used to be. They are larger, but they have to deal 21 with the multiple product slates that I mentioned. It is a 22 more expensive and more complicated distributions. 23 The fourth point is that the particularly 24 severe level that EPA has proposed, 15 rather than 50, is 25 being imposed in great part to accommodate what we believe 27 1 is unproven technology. The technologies they discuss, 2 they cannot confirm that they will, in fact, work. There 3 is, however, other technology that is proven and in use 4 that is more sulfur-resistant. Forcing severe changes to 5 the entire diesel system, speculation that some technology 6 will work, we think is unwarranted. 7 The desire to have the fuel that would 8 accomodate light-duty diesels in the future is not a 9 sufficient reason to impose such an onerous requirment. 10 There is no evidence that that market is going to develop. 11 We believe about the level that the EPA has proposed is a 12 risk to the overall system that need not be taken. 13 Fifth point, it really is not necessary from 14 an air-pollution perspective to reduce sulfur this low. 15 One of the terms I used when the joined the industry, you 16 have to focus on the delta. What is the difference between 17 what we have talked about is doable and what EPA has 18 proposed. We are not talking about going from current 19 levels down. 20 The difference is between the 90 percent in 21 sulfur reduction we propose and the 97 percent they have. 22 As the engine manufacturers will point out, there is 23 already significant reductions from diesel emissions. They 24 are much lower than previous regulations. 25 The difference between the 50 cap and the 15 28 1 cap due to the technologies that can be used is very small. 2 We believe the proven technologies can deliver equivalent 3 emission levels but at half the cost and without strains to 4 the fuel system. Even a slightly less effective the 5 marginal increase in emissions is dwarfted with the high 6 marginal cost with strain on the fuel system. EPA 7 documents the modest contribution of heavy diesel to total 8 inventories after these controls are in place and 9 confirming the very slight difference in total emissions 10 achieved by going to 15. 11 In summary, these five points that are in our 12 written, I want to emphasize we are prepared to undertake a 13 limitation of the 90 percent reduction. Even that will be 14 difficult, however, given all the other challenges. This 15 proposal presents a serious risk of short falls in some 16 areas. It is not necessary from a technological standpoint 17 as the air quality impacts are the same. 18 This industry takes great pride in having a 19 good reputation providing high-quality products that are 20 highly available and work. We don't want to endanger that 21 performance that the public expects and demands of us. We 22 will certainly work with the Agency and others towards the 23 reductions. We think it has to be looked at in the context 24 of what else is happening, taken into consideration what is 25 necessary to go that low that fast, given available 29 1 technology and air quality benefits. 2 If we can achieve equivalent benefits without 3 extra cost burden on the industry and the consumer, we 4 think we should take that path and not drain the system. 5 I appreciate the opportunity to participate. 6 MS. OGE: Thank you. Mr. Walsh, good morning. 7 MR. WALSH: Good morning. Thank you very much 8 for the opportunity to be here with you today. My name is 9 Michael Walsh. I am an independent consultant in the field 10 of motor vehicle pollution control. I am speaking here 11 today on behalf of the American Lung Association. I will 12 summarize my statement in an effort to stay within the ten- 13 minute time frame. 14 The American lung Association strongly 15 supports EPA's efforts to reduce emissions from large 16 diesel and gasoline trucks and buses. We also strongly 17 support reducing sulfur and diesel fuel, both because we 18 believe it is necessary to enable the cleanup of new 19 engines and vehicles, but also because it will facilitate 20 state and local efforts to retrofit and cleaning up the 21 diesel vehicles, many of which will remain on the nation's 22 highways for many years to come. 23 The emissions reductions from these 24 initiatives from our view are long overdue and are 25 necessary if we are ever to achieve healthy clean air 30 1 across the United States. I would like to focus on a few 2 special issues. 3 First of all, diesel particulates we know is 4 especially last hazardous. In 1998, as Dr. Lloyd pointed 5 out, and California concluded that diesel particulate is a 6 known human carcinogen. It is a toxic material. EPA has 7 referred a similar conclusion that it is a probable human 8 carcinogen several times. The World Health Organization as 9 far back as 1988 also reached a similar conclusion and all 10 of these bodies are looking at more than 30 human 11 epidemiological studies that are done consistently finding 12 this effect. 13 Diesel particulate is not only a concern 14 because of its constituents but also because it is admitted 15 very closely to the breathing zones of many people in our 16 urban areas and cleaning up heavy-duty vehicles is 17 especially critical. Without the anticipated reductions 18 from these proposed standards there's a significant risk 19 that an appreciable number of current nonattainment areas 20 across the country for both ozone and particulate will 21 continue to be nonattainment for the foreseeable future. 22 Because heavy-duty vehicles are such a large 23 emission source, it is impossible, I think, for many areas 24 to ever attain without the substantial reductions that this 25 package provides. By 2007, EPA estimates a heavy-duty 31 1 vehicles will account for 29 percent of the mobile source 2 NOx emission and 14 percent of mobile source PM emissions. 3 As Dr. Lloyd pointed out, and this is true in 4 the other urban areas, the proportion in cities and 5 metropolitan regions is much higher. In this case, 6 approximately 50 percent of the NOx in the South Coast. In 7 addition, trucks and buses tend to aggregate in many of our 8 poorer urban sections, exposing the population in those 9 areas to very, very high levels of emissions. 10 Finally, this goes to one of the points 11 Mr. Frick made. The EPA estimates from the emissions from 12 the vehicles by your own admission is low. There are 13 studies that have been carried out. Most recently a study 14 done for EPA which shows large deterioration rates for 15 existing heavy-duty diesel engines. 16 EPA has indicated that they will account for 17 it in the final ruling, but it is not accountable for in 18 the current system. The proposed heavy-duty vehicle and 19 engine emission standards along with the diesel fuel sulfur 20 standard would have a dramatic impact and probably a more 21 dramatic impact than estimated in producing these 22 emissions. That there are complications as well in 23 analyzing the impact of these emissions on air quality. 24 Just to highlight the one recent example, we 25 know that the science of ozone tells us that many of the 32 1 chemical reactions that are part of the ozone-forming cycle 2 are sensitive to temperature and sunlight. The federal 3 government just in the last week issued a major report, a 4 major congressionally mandated report, which indicates that 5 temperatures across the northeastern part of the country 6 are going to increase. 7 If they do, that would indicate that for the 8 same amount of NOx and hydrocarbons we are going to have 9 higher level of ozone in our air. This is just one of the 10 factors, along with the lower deterioration rates that we 11 use in the modeling, that indicate to us that the problemis 12 probably going to be worse rather than better than 13 estimated. 14 I would like to highlight a few major points. 15 One is that the control of emissions mandated 16 by this rule is necessary if the diesel engine is to remain 17 a primary power plant in this country. Here in Southern 18 California we saw last week a significant move away from 19 the use of diesel engines. In response to the serious 20 toxic risk which current diesel engines cause. New York 21 City with its buses moved in the same direction just a 22 short time earlier. 23 This is not limited to this country. The 24 Governor of Tokyo in an active effort is on the way to 25 trying to back the use of diesels. In the city of Beijing 33 1 they have recently replaced 800 diesel buses with CNG. The 2 supreme court of Dehli, the supreme court of India, has an 3 active effort underway to handle these buses and replace 4 them with CNG. This is a worldwide phenomena in response 5 to the current toxic effect of diesels. 6 The point is that current diesel engines 7 here in the U.S. and around the world are increasingly 8 considered hazardous and only substantial control along the 9 lines of their proposal will enable us to reap the full 10 advantages of diesel technology, especially with regard to 11 the very significant fuel economy advantages that this 12 economy contains. 13 Unless we have clean diesels a suspect we will 14 have fewer diesels, and the converse is true. If we have 15 clean diesels I think we will be able to take full 16 advantage of this very effective and useful powerplay. 17 Secondly, the U.S. has become the laggard with 18 regard to control of emissions from heavy-duty vehicles, 19 not the leader in mobile source control that we have 20 traditionally been. The U.S. has been the innovator that 21 has brought us catalytic convertors, on board diagnostics, 22 reformulated gasoline. I could go on and on, especially 23 here in California. 24 At this point one would have to say candidly 25 that Europe is well ahead of us in terms of controlling 34 1 emissions. The Euro-4 and Euro-5 standards, which were 2 adopted a year ago, will result in the installation of many 3 of the advanced technologies that we are talking about here 4 today. At least will be installed in the 2005 to 2008 time 5 frame across Europe, if not earlier. 6 Sweden has relied on diesel fuel for several 7 years, which has less than 10 parts per million. And 8 Germany will have such fuel across the entire country in 9 2003. I expect -- it is not on the books yet -- but I 10 expect that the European Parliament when it has an 11 opportunity to react to new fueling provisions later this 12 year, will mandate 10 parts per million as a maximal level 13 across Europe in this approximate time frame. 14 As a result of the availability of these low 15 sulfur fuels at the present time, in places like Sweden, 16 they have successfully implemented a mandatory retrofit 17 program for trucks and buses, including most recently a 18 retrofit program for offroad vehicles which also use this 19 very low sulfur fuel. 20 The mandatory introduction of fuels with 21 sulfur levels of 10 ppm or less and advanced particulate 22 and NOx controls are necessary if we are to regain our 23 preeminent role as the world's leader. 24 The third point I would like to make is unless 25 low sulfur fuels of 15 ppm or less are mandated nationally 35 1 we will see -- the very point that Mr. Frick pointed out -- 2 more and more of these boutique fuels. If we don't want to 3 see each local region adopting their own fuel, we have to 4 provide them a clean natural fuel. I am sure that many 5 areas will mandate these fuels on their own, unless we have 6 a national requirment. 7 Fourthly, more than sufficient lead time, in 8 my view, exists for the technology to be available to 9 achieve these proposed emissions levels. The manufacturing 10 new emissions control association has stated that, "They 11 believe the emission standards proposed for highway diesel- 12 powered heavy-duty engines standards can be achieved in a 13 cost-effective manner within the lead time provided, if 14 very low sulfur fuel is available." 15 Others have reached a similar conclusion. 16 As we know at the time early, many new technologies, 17 especially for PM control are already being introduced in 18 Europe. I want to particularly applaud several of the 19 diesel engine manufacturers who have stepped up to the 20 challenge in this proposal and have committed to, in the 21 words of the Engine Manufacturers Association "dramatically 22 reduce the emissions of the most fuel-efficient, reliable 23 and durable source of motive power available today and the 24 backbone of or nation's transportation and delivery 25 system." 36 1 International Truck and Engine Corporation is 2 to be especially commended for committing to commercialize 3 their green diesel technology within the next year as long 4 as clean fuel is available in certain localities. 5 Let me conclude by saying that 15 parts per 6 million sulfur is the maximum that should be allowed 7 because it is technologically feasible and necessary. We 8 have heard in Europe there's a movement that 15 ppm is 9 adequate. 10 I would like to quote from the recent proposal 11 from the German government to the European Commission which 12 states that "A sulfur content of 10 ppm compared to 50 ppm 13 increases the performance and durability of oxidizing 14 catalytic convertors, de-NOx catalytic convertors and 15 particulate filters, and, therefore, decreases fuel 16 consumption." 17 "There are also lower particulate emissions, 18 due to lower sulfate emissions, with oxidizing catalytic 19 convertors. For certain continuously regenerating 20 particulate filters, a sulfur content of 10 ppm is required 21 for the simple reason that otherwise the sulfate particles 22 alone would overstep the future European particulate 23 value." 24 Thank you very much for an excellent 25 participation and for a package that I think will go a long 37 1 way in cleaning up our air. 2 MS. OGE: Thank you. Miss Williams, good 3 morning. 4 MS. WILLIAMS: Good morning. I am Stephanie 5 Williams and I am here representing the California Trucking 6 Association. The California Trucking Association has 7 nearly 2,500 members and we represent trucking companies 8 within California and companies that operate into and out 9 of California. We are in complete support of this proposal 10 and have been on the road trying to convince other states 11 that this is the right thing to do. 12 I don't want to duplicate the comments that we 13 have made in Manhattan where we talked about the need for 14 this proposal in SIPS, and when you look toward 2010 you 15 can see that more than half the states will need diesel 16 fuel reformulations, so it is the right time to do this 17 today. 18 Also in Chicago we talked about the 19 maintenance debacle of going to a 15 ppm fuel which we are 20 opposed to was because of the addition of urea to the fuel 21 that would require our drivers to become chemists and add 22 an additional fuel at the time of fueling. And that would 23 not be appropriate for the trucking industry and we hope 24 that 50 ppm is taken off the table. 25 Today I am lucky to have with me some of our 38 1 members. Our member companies that will be affected by 2 this proposal. We have a petroleum tank truck carrier. 3 Two interstate carriers, one a very large international 4 company that will tell us about boutique fuels and the 5 problems going from state to state, and also a smaller 6 interstate carrier that will also talk about that. 7 We have the chairman of our environmental 8 policy committee who has helped develop policy of a 9 national fuel standard for California and the nation. But 10 we actually would like to see that in 2004. We believe 11 that the technology is closer than 2007. We think 12 nationwide that will help with SIPS, and when you look and 13 evaluate the PM traps, I have my little picture here of the 14 PM trap of today's technology on the top. That is the 15 exhaust test. 16 In the middle I have the 15 ppm fuel. You 17 can't see it because it is completely clear. You also 18 can't see the bottom one because it is a clean filter. I 19 think that by being able to test that, we know the 20 technology is there. We see the PM traps out on the green 21 bus, the NOx absorbers are being used in the south and 22 other areas and on gasoline turbines. We believe in 23 national, clean fuel standard as soon as possible is best 24 for the trucking industry and everyone else. 25 With that said, there are two other local 39 1 carriers that will speak to you today on the next panel. 2 People who live and work in Southern California only 3 delivery freight here and I am happy to see these people 4 coming in from other places, including Mexico, including 5 the bordering states. And I am happy to compete on rates 6 on people who can use other fuels. We have a nice mix of 7 the trucking industry here today. You can hear the story 8 from their mouths. 9 I would like to talk about first sulfur. When 10 we say reduce sulfur to 90 percent versus 95, 97 percent, 11 sulfur isn't the issue here. The issue is emissions. How 12 much are they going to emit. How low can you get PM and 13 how low can you get NOx. You are not going to have the 14 same emission reduction with a 90 percent reduction as you 15 are with the proposal as it is today. We would hope that 16 emissions are what you look at. Not the level of sulfur. 17 Also, the preemption issue. That's what it 18 is. When you hear patchwork fuels, patchwork fuels are a 19 problem for this nation. Everyone wants to have clean air 20 but everyone wants to have low fuel prices. What happened 21 is regional fuels, and we see this in California, and it is 22 a danger for our entire economy nationwide. We see fuels 23 going into areas that aren't really that clean. 24 Texas is considering adopting car fuel. Why 25 won't Texas adopt this fuel standard. If you are going to 40 1 go in 2004 or 2003 or whatever the year is, to a fuel 2 standard that is not anywhere near as clean as this one, 3 you are going to put a strain on the system in Texas. 4 Same with South Coast air quality transfer 5 district coming in and reformulating fuel now not in line 6 with EPA creates a regional fueling problem. It creates 7 bad press. It makes the fuel prices jack way up, and the 8 public thinks clean fuels cost a lot of money. That is not 9 the case. When we have one fuel nationwide, the cleanest 10 fuel possible, and we put it through the distribution of 11 today's pipelines, it is a seemless introduction. We have 12 seen this in 1993. The sulfur level federally went to 500 13 ppm, and there were a few glitches with the resistance, but 14 that had nothing to do with supply. 15 In California, on the other hand, we 16 restricted supply with the regional fuel and had supply 17 issues. On a number of occasions we have had supply 18 issues. If we had a nationwide fuel, those supplies would 19 not be a problem. We would not see fuel strikes. He would 20 not see in Chicago $2.10 for gasoline because of a regional 21 fuel supply. They are not getting a really clean fuel like 22 we could have with this proposal if we had a nationwide 23 fuel standard. 24 We would like to see EPA preempt other states 25 from going to anything except this fuel standard. In the 41 1 best of all worlds move forward with the nationwide 2 standard quicker, bring the scale to the market so the 3 public gets clean air and a reasonable price of fuel. 4 Also the capacity and distribution. We believe 5 that the distribution system is fine for this fuel. As the 6 trucking industry, we are hauling this product and we have 7 a petroleum carrier to tell you about it. We have got 8 gasoline in the system right now. We have got all kinds of 9 different fuels, specialty fuels, that go through the 10 pipeline. And this is not going to be an issue. 11 We are going to have a different order in 12 which the fuel goes through the pipeline or is distributed, 13 but it is not going to be a disruption to supply. Believe 14 us, the industry can get it to market. The market system 15 will handle these problems. 16 Also, unproven technology. That is something 17 that I want to really concentrate on because this 18 technology is here. You have the test that shows the PM 19 traps. California has been key in forcing technology. We 20 have electric vehicles, we have had different things that 21 force technology. 22 This time we have the technology sitting on 23 the tables, sitting on a bus outside, working in the air 24 districts on stationary equipment. The technology is here. 25 It is just a generation moving at the fourth generation of 42 1 the diesel engine. The generation where we have the 2 aftertreatment controls that cars have where the trucking 3 industry gets an engine just as clean as a car and we can 4 go back to doing what our specialty is, moving freight to 5 retail outlets, to grocery stores, keeping this country 6 moving. That's what we want to do with clean technology. 7 I would like to say one thing in closing. 8 There's a delta involved in this. But I don't know how 9 many of you realize this, but the delta is the California 10 trucker. Because California, Manhattan, many of these 11 other big cities need this fuel to keep trucks clean. But 12 the difference is the delta, who is going to be hauling 13 freight in these places. The California trucker wants to 14 be put in the mix. We believe we are the delta. Thank 15 you. 16 MS. OGE: Thank you, Stephanie. I would like 17 to ask for Reverand Al Cohen to testify. Good morning. 18 MR. COHEN: Good morning. Thank you. I would 19 like to change the mood here and take a larger view. We 20 are in support of the EPA suggestions. My name is Albert 21 Cohen. I am Executive Director of the Southern California 22 Ecumenical Council, which is a regional church agency 23 representing 19 denominations plus other religious 24 partners. We have been active in environmental affairs 25 since 1971 and have been represented at all of the United 43 1 Nations environment conferences beginning in Stockholm in 2 1972. Furthermore, I drive a Honda EV plus electric 3 vehicle. 4 I am speaking for thousands of church people 5 who understand pollution of the environment as a moral and 6 ethical issue. We accept the scientific conclusions that 7 the atmosphere of the earth is being severely damaged and 8 that serious questions have been raised about the viability 9 of life on the planet as we know it. 10 In November, 1997 the Ecumenical Patriarch 11 Bartholomew said in an address in California, "To commit a 12 crime against the natural world is a sin and for humans to 13 degrade the integrity of the earth by causing changes in 14 its climate, for humans to contaminate the earth's waters, 15 its land, its air and its life with poisonous substances, 16 these are sins." 17 We know perfectly well that the internal 18 combustion engine juggernaut drives a substantial part of 19 the economic system and diesel fuel contributes to that 20 momentum. On the other hand, is life itself and the future 21 of our children to be held hostage by the success of 22 current technology or is it incumbent upon responsible 23 people of our generation to make the hard choices. People 24 who can chart human DNA can reinvent transportation and 25 power production so that human DNA has a future. 44 1 We believe it is appropriate to ask forgiveness 2 for our sins and then to go out and behave differently. 3 The Patriarch, a practical man, said in his same address: 4 "It is appropriate for us to seek ethical, legal recourse 5 in matters of ecological crimes." 6 I would urge the EPA to use its authority to 7 restrict the use of diesel fuel, to change the composition 8 of diesel fuel, and to impose whatever regulations are 9 necessary to clean up the air. There are alternative 10 sources of power available now in production today. A 11 modest investment in research and development will broaden 12 the field of choices for us in the years ahead. Let's 13 stop doing the same old thing and be creative with new 14 opportunities. 15 Thank you for this opportunity to participate 16 MS. OGE: Thank you. Good morning, 17 Mr. Barron. 18 MR. BARRON: Good morning. Thank you. My 19 name is Larry Barron. I am vice president for the western 20 sales region for International Truck and Engine Company, 21 which many of you may know was formerly called Navistar. 22 I am here today on behalf of Patrick Charbonneau who is 23 vice president of Engine Engineering at International to 24 discuss EPA's proposed model year 2007 emission standards 25 for heavy-duty engines as well as the Agency's proposed 45 1 onroad diesel fuel quality requirements. 2 At the outset International commends the EPA 3 for its landmark proposal to address heavy-duty engine 4 emissions through a "systems approach" involving both fuel 5 quality and engine technology. There is no question that 6 diesel engine technology is making dramatic strides in 7 emissions control. 8 As we know, the availability of ultra-clean 9 diesel fuel is a prerequisite toward meeting the 10 challenging new emissions standards beginning in model year 11 2007. With clean diesel fuel, we can count on the advanced 12 NOx and PM aftertreatment technologies needed to achieve 13 unprecedented emissions reductions. For that reason, we 14 are pleased that EPA is mandating fuel that will enable 15 these advanced technologies to be used on all heavy-duty 16 engines. 17 International is investing hundreds of 18 millions of dollars in the development of new technologies 19 for all the markets where our engines are sold. We are 20 reinventing all of your engine lines through revolutionary 21 engine redesign and development of advanced aftertreatment 22 technologies. Our technological breakthroughs will allow 23 us to achieve unparalleled emissions reductions. Indeed, 24 we are developing green diesel technology that with clean 25 fuel, has already demonstrated the capabilities of 46 1 particulate filter technology to reduce hydrocarbon and PM 2 emissions to levels that are at or below EPA's proposed 3 standards. 4 In that regard it is important to note that 5 progressive oil companies already are making 15 parts per 6 million diesel fuel commercially available. These oil 7 companies have earned recognition and applause for their 8 efforts to bring clean diesel fuel to the marketplace 9 early. With this ultra-clean fuel available so soon, 10 International will commercialize its green diesel engine 11 technology next year and thus achieve EPA's proposed model 12 year 2007 hydrdocarbon and PM emissions standards six years 13 ahead of schedule. 14 We have outside a school bus today that has 15 this technology using 15 ppm fuel if you would like to 16 take a look at it. It is right outside the front door. 17 The tailpipe faces the street, so if you go to look at it 18 please be careful. That has been in service for six months 19 and the tailpipe has no soot in it. This is just one 20 example of the impressive environmental benefits that 21 accrue from a symptoms approach involving both clean fuel 22 and clean engine technologies. 23 I also commend the Agency for its willingness 24 to phase-in the proposed NOx standards. We strongly 25 support a NOx system and approach which underscores the 47 1 challenges facing in meeting NOx control targets EPA 2 proposal goes far in addressing these categories. We 3 believe that even more can be done without compromising 4 important environmental objectives. In that regard, I am 5 pleased to say that in your International along with EMA 6 soon will be presenting to EPA a new NOx phase-in proposal. 7 Under this proposal, there would be a single 8 NOx emission standard for all the engines in model year 9 2007. The NOx model standard for 2007 would be 10 significantly below the NOx standard applied to the model 11 year 2006 engines. Then in 2010, the NOx standards will be 12 stepped down to a new and significantly tighter NOx 13 standard. 14 Importantly this proposal will meet and 15 perhaps exceed the Agency's NOx reduction targets in this 16 rulemaking, while at the same time providing manufacturers 17 with needed flexibilty to meet those targets. For these 18 reasons, we believe that the Agency will find this proposal 19 to be a win-win for consumers and the environment alike, 20 and look forward to discussing it in greater detail. 21 In closing, I wish to reiterate 22 International's strong support for EPA's proposal to reduce 23 diesel fuel sulfur levels which will enable the use of the 24 NOx and PM aftertreatment technologies needed to achieve 25 the Agency's objectives. we look forward to discussing in 48 1 our written comments these and other technical details of 2 the EPA's proposed rule. 3 I thank you for giving me and International 4 the opportunity to present International's views today and 5 I would be happy to answer any questions you have 6 concerning my testimony 7 MS. OGE: I would like to thank all the 8 panelists for their testimony. 9 Mr. Barron, let me make clear that I 10 understand your testimony fully. What you are saying is 11 that with clean diesel fuel, 15 parts per million, the 12 aftertreatment technologies that we envision to deliver 13 cleaner emissions will be commercially available and you 14 are not calling them unproven technologies? 15 MR. BARRON: No, ma'am. We propose to 16 release that bus that is outside with a couple more 17 modifications commercially next summer particularly for the 18 California market and for wherever the fuel is available 19 that will enable that technology to work which is 15 ppm 20 diesel fuel. 21 MS. OGE: Mr. Frick, I am somewhat at a loss 22 with your statement that these technologies that we are 23 proposing will be unproven. Do you want to comment? 24 MR. FRICK: I don't know what technology he 25 is referring to. When you look at technology that is 49 1 currently being used in Europe. If you go down to NOx and 2 others we think the verdict is still out. They have 3 demonstrated and your record basically says the same thing. 4 If that's what he is talking about, then we will look at 5 that record. 6 MS. OGE: Do you have any response to that? 7 MR. BARRON: I would prefer to have 8 Mr. Charbonneau address those comments with the exact 9 numbers. I would not like to quote those numbers off the 10 top of my head. There is significant reduction in both NOx 11 and particulates below the levels that are proposed. 12 MS. OGE: Mr. Frick, obviously one of our most 13 challenging issues in this regulatory program is the 14 appropriate level of sulfur and diesel. In our view, we 15 have stated in our proposal the difference between a 90- 16 percent reduction that your industry has suggested and a 17 97-percent reduction. The delta is a significant loss on 18 public health protection. 19 As we have stated in our proposal, we will be 20 left with the 50 parts per million problem in place. You 21 can only achieve 20 percent reduction so the public health 22 won't be affected. That's the dilemma we have here. 23 In your testimony, both written and oral 24 comments, you have suggested that there are other 25 technologies that are more proven and they are sensitive to 50 1 sulfur that they can get us this same end results as far as 2 public protection. Could you elaborate about those 3 technologies? 4 MR. FRICK: That's correct and we have advised 5 you and I believe your testimony in New York you received 6 additional information on that. It is not only a 20 7 percent, but you can be in the 85 to 90 percent reductions 8 from the SCR and other technologies that are available. So 9 your assumption of 20 percent, we disagree with there are 10 technologies out there. 11 MS. OGE: So the technologies that you are 12 referring to is the urea SCL technology? 13 MR. FRICK: I agree. The issue is the 14 emissions. The sulfur is merely a mechanism to get this to 15 those emissions. That's why we are saying that we believe 16 there are technologies out there as at a higher level will 17 get essentially the same level. 18 MS. OGE: EPA's proposal, so I understand, 19 your proposal is for us to move forward with an SCR type of 20 technology in order to achieve the NOx reduction. 21 MR. FRICK: As you know, the Agency sets the 22 emission standards and the industry will decide what 23 technology it wants to use. We believe that that 24 technology can be implemented without the problems that the 25 lower level present to achieve the emission reductions. 51 1 What ultimately the trucks choose to use would dictate that 2 we only feel one is available. 3 MS. OGE: I would like to ask Ms. Williams to 4 respond to this. 5 MS. WILLIAMS: Why would you want to shift the 6 burden to small companies like trucking. Here we have a 7 proposal that says we will have either a clean fuel to get 8 the emissions or we are going to have a dirty fuel with 9 duct tape and a couple of bandadesdates. That's not fair 10 to us. 11 The California truckers have already taken the 12 brunt at this fuel reformulation in 1993. We have been 13 operating in a noncompetitive environment and they made all 14 the money. I think it is fair that it is our turn to be 15 first. You looked at them in '93. Put us first this time. 16 We want 15 ppm. In Europe we already know 17 what happens with 15 ppm sulfur. It is 10 percent 18 maintenance failure on the traps. That means our guys have 19 to take the trucks off the road and figure out how to fix 20 thing. I don't think that is a fair thing to ask small 21 businesses to do. And I do not believe that technology 22 that they are requesting gets you down as far as 15 ppm. 23 When you have the industry asking for something clean and 24 you have the suppliers fighting over which technology to 25 use, I think that you should divert the industry and go for 52 1 what is clean and easy. 2 We are not chemists. We are truckers. We 3 don't want to put a hazaradous waste -- we are going to 4 take ammonia and have a truck driver putting it into a 5 truck. What is the regulatory of that. What is the 6 liability to the trucking company. It is not fair. 7 MR. FRICK: If you don't mind, she said 50. 8 90 percent reduction is dirty. That's a huge reduction. 9 You are talking about ultra-clean. 10 MS. OGE: I would like to ask for, Mr. Walsh, 11 your experience with Europe because some of the European 12 countries are considering SCR. 13 MR. WALSH: Thank you. First of all -- 14 MS. OGE: Will you please state your name 15 before you speak. 16 MR. WALSH: This is Michael Walsh for the 17 American Lung Association. I won't repeat the quotation 18 that is in my written testimony from the German government 19 on the difference between 15 ppm and 10 ppm in terms of how 20 much it allows different fuels and different emission level 21 to be achieved by different technology. 22 With regard to SCR threat I will he say a 23 number of things. One, I hope and hope and I am optimistic 24 that SCR will find some applications. I think it is an 25 encouraging technology, but only so far I think in fleet 53 1 applications where you have a centrally fueled environment 2 and not going across the entire country in one move that we 3 heard earlier from going from the East Coast to the West 4 Coast or vice versa. 5 Secondly, the experience in urea with SCR is, 6 of course, in a limited prototype stage and is not 7 achieving the NOx levels that are being proposed by EPA. 8 Thirdly, I think that the Europeans are still 9 wrestling with and have not yet solved the problem with 10 infrastructure. We have not cost it out and I don't know 11 anyone who has yet cost it out what it would entail to put 12 a urea infrastructure across the entire country. I think 13 that's a very difficult challenge. 14 I think you have an issue that I am interested 15 if Ms. Williams wanted to comment it on it from a trucking 16 standpoint, but the European solution that is being talked 17 about and the problem of refilling is the urea tank after 18 50,000 kilometers, is a difficult one. What they are 19 planning, at least in some cases -- and this is the only 20 solution they have been able to come up with so far -- is 21 to have a mechanical and electrical system that will die 22 between the engine when the urea runs out and basically 23 force the trucker to limp home to some facility where he 24 can put the urea in. 25 It will not completely shutdown the vehicle 54 1 but it will not be a very useful vehicle other than just to 2 get to some place. I am not sure how the trucking industry 3 in this country will react to such a solution. 4 Finally, the whole issue of toxics. Again, 5 Ms. Williams made reference to it, but it is not limited 6 just to ammonia. Ammonia is an issue. But there are other 7 toxics which have not been fully characterized from the SCR 8 that will need to be characterized, as we learned recently 9 with another fuel additive, that we have to look carefully 10 at fuel additives to make sure we are not creating more 11 problems when we solve one problem. 12 To the extent there's an ammonia slip the 13 solution does seem to be to put an oxygen catalyst after 14 the SCR system if you do not have to worry about what is 15 the implementation of the sulfur on that oxygen catalyst 16 that is after the SCR system. 17 Finally, with regard to that, if you have to 18 add that your oxygenation catalyst lowers the ammonia, 19 oxygen catalyst can increase NOx emissions again. If you 20 are trying to get down reliably in use over the lifetime of 21 heavy duty vehicles to these very low levels, it seems to 22 me that there are very substantial challenges that make it 23 difficult to see how in the short term if in the long-term 24 we are going to be able to see this as a mainstream 25 technology. I hope that answers your question. 55 1 MS. OGE: Thank you. Mr. Lloyd, I have a 2 statement here -- I am reading from Mr. Frick's testimony. 3 "I also note that CARB, which has adopted a program to 4 reduce urban bus emissions that involves cleaner diesel 5 formulations, has indicated that it can be flexible 6 if EPA decides against a 97-percent reduction." 7 I was wondering if you can elaborate for us 8 what does that mean, being flexible if you decide against a 9 15 parts per million. Were you planning to go higher or 10 lower or is this an accurate statement? 11 MR. LLOYD: Are you talking about the transit 12 bus rule? 13 MS. OGE: I have no idea. Maybe Mr. Frick can 14 elaborate. The first page of your testimony. 15 MR. LLOYD: Are you talking about South Coast 16 or ARB? 17 MS. OGE: I don't know. I am reading from 18 Mr. Frick's testimony. 19 MR. LLOYD: I got some clarification from 20 executive officer. I think what that was referring to was 21 that we clearly in our rule we were looking at 15 ppm 22 sulfur diesel. I think the issue here is that if, in fact, 23 EPA didn't come in close to that we would your degree to 24 some flexibility. That flexibility, however, would not 25 exceed going above 20 ppm sulfur, certainly not as high as 56 1 15 ppm. We didn't want to quibble over a small amount. My 2 original testimony stands. We strongly support the 15 ppm 3 or lower. 4 MS. OGE: I was wondering if any of the other 5 EPA panel members have questions or clarifications? No 6 additional statements from the panel members before we 7 close. Mr. Lloyd? 8 MR. LLOYD: The only statement I would make 9 to Mr. Frick's comment here is one of the things we are 10 fortunate to see these days is that with the development of 11 technology we are seeing a whole menu of technology which 12 can also use a huge diversity of fuels. We are fortunate 13 in saying not only do we have the low sulfur diesel we have 14 all the fuels that can play a role. 15 Just a reminder that was the industry that 16 came forward in response to methanol, natural gas, which is 17 stepping forward. We have propane, we have obviously 18 ethanol and the electric vehicle. We have electricity. If 19 we get into the fuel cell, that can use a whole variety of 20 fuel cells. While understanding some of the constraints 21 the beauty is that we are entering a whole new area. We 22 have a much greater menu than we had before. 23 MR. OGE: I would like to thank you all of 24 your testimony. Now I would like to call the following 25 individuals to please come forward. 57 1 Ms. Valerie Liese, Mr. John Nieyes, Mr. Dave 2 Berry, Mr. Al Nunes, Mr. Frank Smith and Ms. Roberta 3 Barbalace. 4 Ms. Liese, we will start with you. 5 MS. LIESE: My name is Valerie Liese. I am 6 the president of Jack Jones Trucking, Incorporated in 7 Chino. I have got 104 employees and 48 of them are 8 drivers. We operate directly in the Southern California 9 area from San Diego up to Santa Barbara. I commend the EPA 10 for everything they are doing to protect the future of 11 California. California Has always led the rest of the 12 states in various ways and with clean air being top 13 priority at this time. We are all for it. 14 I would do anything in the world to protect 15 the future of this state. I am going to use whatever fuel 16 is mandated by the State. But we want an equal playing 17 field. We need to be able to compete with the trucking 18 companies that operate from other states. We have a very 19 thin bottom line of how we can operate and make a profit. 20 We do have lower rates than a lot of other trucking 21 companies to be able to pay for the higher cost of fuel in 22 this state for the high cost of insurance and many other 23 costs. It is well worth it. 24 I just want to let you know that we are going 25 to do what it takes to make sure that we survive in this 58 1 industry too. I have got a lot of competition out there. 2 I have to deal with a male-dominated industry and being 3 just a little guy on the end of the totem pole. We have a 4 lot of wolves on our hands, but I just commend all of you 5 for what you are doing to help us too. That's all I have 6 got. 7 MS. OGE: Thank you. Mr. Berry, good morning. 8 MR. BERRY: Good morning. I am Dave Berry 9 with Swift Transportation. We also support the EPA's 10 proposed rule. Swift Transportation is the nation's third 11 largest truckload carrier. We have operations throughout 12 the United States and we have very significant operations 13 here in California. We are sometimes the person that is 14 referred to as from out of state. 15 We also very strongly support the clean fuel 16 concept nationally. Our concern is that if we end up with 17 this patchwork quilt of boutique fuels across the United 18 States, that there will be no one viable fuel and then how 19 do we conduct and better serve interstate customer. Two, 20 we have 50 different tanks on the truck and the driver 21 switches the valve when he is from state to state. So we 22 very strongly endorse the concept of one nation fuel. 23 We also recognize that many of the 24 nonattainment areas around this country are having to come 25 up with state implemention plans that are due before this 59 1 had become a regulation, before 2007. So we are concerned 2 about this boutique fuels coming up as a strategy to deal 3 with these nonattainment areas prior for 2007. That is, we 4 wholeheartedly endorse this proposal and I am really very 5 excited about what it can do for our engines and the air. 6 MS. OGE: Thank you. Mr. Nieyez. Good 7 morning. 8 MR. NIEYEZ: Good morning. Thank you very 9 much for having me here. My name is Joe Nieyez and I am 10 President of Quikway Trucking Company. Quikway Trucking 11 Company came into existence in 1946 when my dad started the 12 company right after the Big One. I was also president of 13 the California Trucking Association in 1998. I am here to 14 show my support for the EPA's proposed 15 parts per million 15 fuel standard. 16 I have three concerns and as a native 17 Californian -- and I think I am going to be staying here 18 for the rest of my life. My number one concern is the 19 health factors for the State of California. There's no 20 question in any mind that 15 parts per million helps toward 21 the health of California citizen or of anyone in 22 California. 23 Number two concern is a level playing field. 24 We are in a business what we call an assembly and 25 distribution business, whereas we assemble freight and it 60 1 is goes out of state, outside of California. We also 2 distribute freight that comes in from out of state. 3 Truckload carriers are very competitive and they are my 4 direct competitors because they can go out and make five or 5 six deliveries that my company makes on a local basis. 6 As it is right now, I am paying a higher cost 7 for car fuel, whereas the out of state trucks are not and 8 they are operating in the same air that I am operating in. 9 The other area of level playing field is from the oil 10 companies. My belief is that the oil companies, whatever 11 they do I am going to end up paying for that plus some, and 12 I am going to try and pass that onto my customers. I pass 13 through the costs that are going to be borne by us from the 14 oil companies. 15 Third concern is a strategy known in business 16 today that needs to have some sense of structure in how to 17 plan for the future. With the EPA's 15 parts per million 18 standard, that gives us a road to go down. However, AQMD 19 is also pushing for a 15 parts per million standard but 20 they want it tomorrow, whereas the EPA has set a date of 21 the year 2006. This is very concerning to me and it should 22 be concerning to the business community and to the 23 consumers of goods. 24 Just kind of in closing, my company will 25 support and I am sure the California Trucking Association 61 1 will support anything that significantly reduces emissions 2 into the air. 3 Thank you very much for having me here today. 4 MS. OGE: Thank you for your testimony. 5 Ms. Roberta Barbalace. Good morning. 6 MS. BARBALACE: Good morning. I am Roberta 7 Barbalace. I represent Onyx Environmental Services, which 8 is a division of Gavendi. We are an interstate tranporter 9 approximately 350 diesel vehicles and approximately 237 of 10 which are apportioned. We have terminals in 23 states. 11 While many of our vehicles are domiciled in 12 states that will likely have state-enforced sulfur limits 13 diesel fuel within a few years, at least a third of them 14 are located in states that will likely not fall under any 15 state regulations in 2007. As an environmental firm, Onyx 16 Environmental Services recognizes our role in protecting 17 the quality of the air, not only in the neighborhoods in 18 which we work and live, but in everybody's neighborhoods. 19 Even in area of the carcinogenic effects of diesel fuel 20 exhausts on respiratory problems. It can likely be 21 attributed to exposure to diesel exhaust. 22 As an asthmatic and class-A truck driver, I 23 can attest to the effects of diesel fuel exhaust on my 24 condition. Fortunately, my symptoms are completely 25 controlled by medication. Others are not so lucky. 62 1 The trucking industry must be very careful not 2 to follow in the steps of the tobacco industry. As such, 3 denial would only lead to deepen the gap between the 4 trucking industry and the general public. I think people 5 can see here today, in fact, that the trucking industry is 6 very concerned. We are certainly willing to take the steps 7 that are necessary to improve the environmental situation. 8 Regionalized fuel formulation is unfair to the 9 trucking companies and to the public as well. California 10 is a good example. Reformulated low diesel fuel, car fuel, 11 was mandated in 1993. Other states continue to use 12 nonreformulated fuel. Interstate drivers from outside of 13 California fuel up with a cheaper fuel before coming into 14 California and they do their business in California and 15 leave without ever purchasing the reformulated fuel. 16 The cost of keeping the environment clean in 17 California falls upon the California trucker and not by 18 other people coming into the state. The cost -- if we 19 don't have reformulated fuel across the country as 15 parts 20 per million type of fuel -- the cost of reformulated diesel 21 fuel will remain high and fluctuation in costs will be 22 greatly influenced by availability. 23 In the end, the individual state regulations 24 will do very little to reduce the diesel exhaust pollution. 25 Our interstate will have even more problems. Predomiciled 63 1 states require that particulate tracks will have a 2 tremendous maintenance expense. Tanks will clog up when 3 diesel fuel with sulfur of greater than 15 percent is used. 4 In addition, fuel efficiency is greatly 5 reduced when interstate vehicles fitted with particulate 6 tracks need to be refueled in states where they only have 7 nonreformulated fuel. The costs of vehicles will increase 8 significantly or maintenance of the vehicles will increase 9 significantly while the fuel efficiency and performance 10 will be compromised. 11 It will also be difficult for us to transfer 12 our vehicles from one terminal to another because some will 13 be equipped with particulate traps and others will not be. 14 A 7 percent increase in diesel fuel across the country, 15 then the 40 percent gallon increase that some of California 16 trucking companies faced in 1999. 17 Interstate truckers from all over the country 18 pick up and deliver goods in the metropolitan areas that 19 are being penalized for excessive pollution. Why should 20 they not pay their fair share. Even your interstate 21 drivers in rural states frequently transport the products 22 that are made from materials originally coming from the 23 metropolitan areas of the transport of materials from Los 24 Angeles or New York City or some other metropolitan area 25 results in diesel fuel pollution in those cities. People 64 1 living in Montana, Maine, North Dakota use countless 2 products made in Los Angeles and New York. They distribute 3 to diesel exhaust pollution in these cities. 4 Everyone that contributes to pollution should 5 pay their fair share of the cost of reducing pollutants in 6 the environment. Proposal to mandate a national fuel 7 standard of 15 parts per million sulfur diesel fuel is both 8 fair and environmentally sound. Environmental Services 9 supports the proposal and applauds EPA for taking such a 10 stand. Thank you. 11 MS. OGE: Thank you. Mr. Al Nunes. Good 12 morning. 13 MR. NUNES: My name is Albert Nunes, President 14 of A.C. Trucking in Monteca, California. I am a carrier 15 that has many diversities. We do freight from interval to 16 interstate. We do all kinds of different products and/or 17 involvement. We have about 40 some trucks and about 50 18 some employees. We are not one of the large companies but 19 we are a part of this trucking organization. 20 Also, I am this year's chairman of the 21 California Trucking Associations Environmental Policy 22 Committee. That committee is one that reviews and works on 23 environmental issues within our state. We have been 24 working with the car and other regulatory agencies over the 25 last couple of weeks to try to come to some equitable ways 65 1 of solving the environmental problems that we face. 2 My colleagues up here all talk about the 3 different things that happen to them and the other issues 4 that are taking place that are important to us. As I 5 mentioned about the trucks that come from out of state, 6 50 percent of the trucks on California highways are from 7 out of state, and in most cases are not burning the 8 automobile sulfur or car diesel. 9 What good is all the work that we have done as 10 California truckers to help clean up the air. It is all 11 for nought because we do not have a one-nation fuel. Our 12 committee started early on to work with our national 13 organizations that proposed the nationwide low sulfur 14 diesel. We didn't have the exact numbers that we have 15 today that the EPA is proposing, but we are working around 16 30 parts per million. Our committee supports the 15 parts 17 per million regulation from most ultra-low sulfur diesel. 18 We feel that it is the fairest way to accomplish the goal 19 of clean air. Thank you. 20 MS. OGE: Thank you. Mr. Smith, good morning. 21 MR. SMITH: Good morning. I would also like 22 to thank the board for allowing us to speak here. My name 23 is Frank Smith, Interstate Claims, third generation company 24 that hauls all the gasoline -- not all of it -- but much of 25 the gasoline or diesel in the L. A. Basin. We have a total 66 1 of 72 trucks. 2 We support the EPA regulation of the 15 parts 3 per million. We believe that the distribution system of a 4 nonroad heavy-duty diesel fuel will be seeing one type of 5 fuel sold nation-wide. Replacing the current diesel 6 fuels with ultra-low sulfur diesel fuel will be the most 7 cost-effective approach to introducing fuel. A minimal 8 investment will be required in the distribution system of 9 trucking. Retail stations would carry the same efficiency 10 and no incremental cost to replace the current fuel and 11 distribute a cleaner product. 12 I disagree with the assumptions related to the 13 trucking contained in the cost impacts of low sulfur fuel 14 submitted by the EPA on February 23, 2000. Clean products 15 like gasoline are currently moving through the pipelines 16 and efficiently transported to market. Introduction of low 17 sulfur diesel fuel nationwide would have a long-term 18 positive economic impact as it would prohibit the use of 19 boutique fuels which will be a long-term problem. 20 The nationwide cost associated with higher 21 than 15 parts per million places the cost burden on truck 22 owners with the fuel spills emission controls. The 23 environmental benefit of the rule is sacrificed to a 15 24 part for level and the distribution is that a real concern 25 of the market behavior upon introduction of the 50 parts 67 1 per sulfur fuel which like this is a complete replacement 2 for a existent product proved there were already 3 distributions. Only when products are introduced. A 4 regional setting, such as CARB 1093 and CARB reformulated 5 gas in '96 is a distribution concern because economics and 6 scale are lost and alagapolies are created with a handful 7 of suppliers. The recommendation is to introduce so the 8 distribution system and supply centers can be economically 9 addressed. Thank you. 10 MS. OGE: Thank you. Ms. Fogel, good morning. 11 MS. FOGEL: Good morning. Can you hear me? I 12 am a teacher with L.A. Unified and I have a couple of 13 visuals. Can we use that overhead? I am Judy Fogel. I am 14 a first-grade teacher with L.A. Unified. I wanted to share 15 with you today. I am grateful you are here. 16 I wanted to share with you a little bit of our 17 reality of 1,200 children of what it has been like at our 18 school. Last September I started hearing about that diesel 19 was a carcinogenic component and I looked out my classroom 20 window and I have 23 diesel buses outside my classroom and 21 my little children, some of them have asthma. We have 55 22 asthmatics at our school. 23 I started calling around and asking my people 24 and the buses were idling and the kids are walking through 25 this gray smoke. I invited the man from the ADOT to speak 68 1 to our faculty and he said you are creating what is known 2 as a line source of pollution. It is like a factory you 3 put across from your school. This is four feet from play 4 equipment. 5 I started at the time looking into the 6 possibility of moving the buses away from the school yard, 7 and you would think my principal would be happy and giving 8 me some kind of a service award for realizing these health 9 concerns. She called me in and put my transfer papers in 10 front of me and she said, "You need to move on to another 11 school." I was stunned and I said after a minute, "If I 12 promise not to say anything about these diesel buses, can I 13 stay at this school?" And she said we will think about it. 14 That's what my year has been like having 15 asthmatic children breathing. The buses are still in front 16 of our classroom. Some of them are 25 years old. 17 I am excited that International and these 18 other companies are coming up with other technologies. The 19 reality is we are living with the old technology and will 20 for some years to come. We have been writing Governor 21 Davis to ask for clean buses. 22 One little girl said to me when we heard that 23 the EPA was passing a rule of making cleaner buses, she 24 said, "When I am 13 that's when we will get the cleaner 25 buses." That's the reality of children's lives. 30 69 1 teachers at our school signed a letter to Dr. Lloyd asking 2 if they could include buses. We will see what help we can 3 get. 4 I was saying to myself, if I call my school 5 district and I said a carcinogenic contaminant was buckling 6 up out of the school yard they would close the school. It 7 is buckling out of these buses four feet from the play yard 8 where the children are and no one does a thing about it. 9 When I call the school and say can we possibly 10 by cleaner buses, they say we don't have the money. This 11 is after our L.A. District just built the most expensive 12 high school in the history of our nation, $200 million. 13 And I walked away from it. You can see the waste and 14 corruption. Possibly at a local level. That's why we need 15 federal groups like yours to come in and help set 16 standards. 17 My husband was telling me about Pacific 18 Electric. We had in Los Angeles a rapid transit system at 19 one time called the Blue Line that was beautiful. You 20 could get from Mt. Wilson to L.A. Harbor quite rapidly 21 anywhere around the city and three corporations came in and 22 bought it up. I believe it was Standard Oil, Goodyear 23 Tires and General Motors. 24 They did this all across the nation. They 25 bought all these rapid transit systems and they dismantled 70 1 them. Our government sat by and watched. It did nothing 2 except built more freeways and taxed the fuel that those 3 cars and those tires use up where I do see our government 4 stepping up to the bat. Our local ADOT stepped in on the 5 local issue where the Mayor was going to buy old diesel 6 buses and they spoke up and the Mayor changed his mind. 7 I am told, I don't know that this is true, in 8 August they are prepared to vote for these low sulfur rules 9 and our air resources board and our governor is not willing 10 to back them up on it. That's what I am being told by 11 them. I find that frightening and I hope someone at a 12 federal level can help us. 13 Also, in the '60s on Channel 5 there was a 14 broadcaster named Pete Roberts. In the '60s he had a man 15 on who was head of a refinery. This is almost 40 years ago 16 who said we know our sulfur content is too high and we are 17 killing people and we are going to really work on this. 18 My husband is an engineer and he knows all 19 this. Nothing has happened. This is an old, old fight, 20 the sulfur content in the fuel. I hope you can reduce it. 21 Someone up here said from one of trucking groups that truck 22 diesel engines are efficient. I guess it was someone from 23 the EPA that said how efficient diesel trucks are. 24 I will tell you what are efficient, trains. 25 If this happened backwards that I told you you can put all 71 1 these trucks on rails where there's less drag, hundreds of 2 cars with only five men working them, there's less drag and 3 you only need two diesel engines. We have this great new 4 technology, let's try it out and you say great, but it 5 happened in reverse. We have gone back to these little 6 individual chinzy trucks on the road creating all this 7 pollution. We are killing ourselves. 8 At one point there was a move to put big 9 trucks on trains and move them between the more common 10 routes in New York and Los Angeles. Some dimwit said no, 11 we can't do that because we will lose jobs. Instead of five 12 men working one train we have all these people being 13 employed killing us. 14 I want my student to come up. She has asthma. 15 Do you want to tell them what it feels like to have asthma. 16 Maybe her mom would talk. She had a pretty scary incident 17 that happened. I was surprised to hear about it. No. Do 18 you want to show them a picture of a bus. She drew a 19 pretty picture of a bus and wrote a letter. 20 She wrote to Mayor Reardon: "Thank you for 21 making clean buses because some people like me have asthma 22 and can die." Do you want to tell her about her experience 23 with the paramedics? 24 MS. OGE: Could you please state your name? 25 MS. VASQUEZ: Reyna Vasquez. My daughter is 72 1 Sylvia Barcabalo. There is nothing more scary than being 2 at work and being called that your daughter is really sick 3 and getting there and not be able to see her because the 4 paramedics are working with her. I would like to see that 5 this things that happen to me, it won't happen to anybody 6 else that has kids. It is very scary. It happened to me 7 like three days, five days in a week. 8 30 days I have to be with her in the hospital 9 giving her treatments and all kinds of stuff. People who 10 don't have asthma, they don't know what being scared is 11 about your daughter is not going to make it. I was even 12 able to teach my 13 year old to drive my car so in case I 13 have to give her breathing so she can make it to the 14 hospital. I would like to see that they do something about 15 it so it won't happen to other kids and other families with 16 low income like me. Thank you very much. 17 MR. OGE: Thank you for coming and bringing 18 your daughter forward. We would also like to thank all the 19 panel members for taking the time to share your views with 20 us. Thank you very much. 21 We would like to move to the next panel. I 22 would like to call Ms. Cheryl Love-Queen, Professor Scott 23 Sherman, Dr. Richard Barbers, Mr. Dennis Firestone, 24 Mr. Reggie Latham, and Mr. Ron Benson. If you could place 25 the names on the cards in front of you. Given the fact 73 1 that we are running late and we don't have a full panel, I 2 would like to call members from the 11:45 panel. 3 Mr. Angelo Bellomo, Mr. Richard Shyu, 4 Mr. David Freeman, Mr. Jim Cameron, Ms. Elaine Chang. We 5 have Mr. Liu. Please print the names on the cards in front 6 of. 7 Ms. Love-Queen, we will start with you. Good 8 morning. 9 MS. LOVE-QUEEN: My name is Cheryl Love-Queen. 10 I am the owner of a small consultant business. We train 11 trainers and the best practices for school districts. We 12 also represent community coalition for change, which is a 13 service planning area which some of you are familiar with 14 through the county. This area covers South Central, 15 Compton, Long Beach and Paramount, and I am also a child 16 advocate. 17 The Los Angeles County is one of the 25 most 18 ozone polluted counties with pediatric asthma affecting 19 137,128. Excuse me, with children under 14 affected by the 20 rate of 2,146,031, according to the Lung Society. A major 21 hospital in South Central reported that asthma is one of 22 the top two reasons for hospital visits or being in the 23 hospital for children in the clinics. And adding insult to 24 injury studies indicate that while asthma has become a 25 major public health problem affecting Americans of all 74 1 ages, race, and ethnic groups children have been 2 particularly severely affected. It is most severe among 3 low income and minority children. 4 In many areas of America you can find child- 5 care facilities close to large intersections on every 6 freeway. However, I am zoning in today on one particular 7 one in Willowbrook. That is an area close to Los Angeles 8 and it is on Imperial. This child-care center sits at the 9 bottom of the 105 freeway, the Century Freeway, and is 10 nine-tenths of a mile from the Alameda corridor. 11 Diesel trucks, buses and trains pollute the 12 front, back and sides of this tiny facility. Where you 13 have children and adults playing as usual and having no 14 idea what virtual health hazard trap they are involved in. 15 Imagine if you had a child or grandchild who had to work or 16 play in that area. 17 In order to protect children are our future we 18 must require drastic reduction in pollution from diesel 19 buses, trucks, and cars post-haste. In addition, the oil 20 industry and engine manufacturers have done very little to 21 curb this pollution. In fact, they have cheated in their 22 emissions in the past resulting in an extra 1.3 million 23 tons of pollution each year. However, because high sulfur 24 fuel will poison the new diesel cleanup technology, we must 25 ensure that all diesel fuel is fully cleaned up and readily 75 1 available before trucks are required to cleanup. 2 Therefore, in order to ensure that all cleaner 3 trucks, buses and cars will have access to clean fuel 4 necessary to run them, CCC, which is the Community 5 Coalition for Change, which I represent, urges the EPA to 6 require diesel sulfur levels for onroad and offroad 7 vehicles with a cap of no more than 15 ppm sulfur 8 nationwide by 2003. 9 There should be no phase-in period for 10 reduction in smog-forming pollution. In addition the EPA 11 should take measure to ensure that big trucks are meeting 12 the emission standards on the road, not just during the 13 engine test. These provisions are necessary to prevent our 14 future generation of children's health and at school and at 15 home, such as I indicated in my earlier testimony. We ask 16 that you include them in your final rulemaking. Thank you. 17 MS. OGE: Thank you, Dr. Barbers. Good 18 morning. 19 MR. BARBERS: Good afternoon. 20 MS. OGE: Yes, it is afternoon. 21 MR. BARBERS: I want to thank the EPA for 22 having this hearing today as well as allowing me to have a 23 chance to speak today. My name is Richard Barbers and I am 24 a Professor of Medicine at the University of Southern 25 California Tech School of Medicine. I am also the current 76 1 Governor for the American College of Chest Physicians for 2 the Southern California region. I am also a member of the 3 Trigos (phonetic) society of Los Angeles and a volunteer 4 member of the American Lung Association. 5 I am here to ask you to adopt the common-sense 6 approach to clean up the heavy-duty trucks and buses and 7 also for air pollution in the city of Los Angeles. 8 Nationwide 40,000 people die prematurely each year from 9 breathing soot pollution. Diesel soot pollution has been 10 linked to cancer and has been published in over 37 11 scientific journals. 12 In addition, there are several scientific 13 studies on the effects of soot pollution on airway health. 14 There are also several studies that indicate that diesel 15 air pollution may effect allergic individuals. Diesel 16 vehicles contribute more than their fair share to the air 17 pollution problem. In fact, here in Los Angeles when the 18 proposed standards go into effect in 2007, heavy-duty 19 trucks and buses will be responsible for an estimated 26 20 percent of the smog-forming pollution and estimated 14 21 percent of the soot produced by all the cities' vehicles. 22 As a commuter who travels about 25 miles each way from my 23 home, I am aware and have personally experienced the 24 effects of diesel soot pollution. 25 I agree with your proposal to protect public 77 1 health by drastically cleaning up big trucks and buses. 2 Also, since high sulfur fuel poisons new pollution-control 3 equipment, it makes sense that you are proposing to produce 4 sulfur to reduce levels of sulfur fuel in 97 percent in 5 2006 before the vehicle standards go into effect. 6 I urge you not to weaken this provision by 7 allowing an extended time line of higher sulfur levels. If 8 the newer, cleaner trucks do not have reliable access to 9 15 ppm sulfur, we will not be able to meet the necessary 10 pollution reductions. Furthermore, these newer, cleaner 11 trucks should be required to meet the newer emission 12 standards as soon as possible. 13 We are already going to have to wait until 14 2007 before we see any major reductions in soot pollution. 15 We should not have to wait until 2010 until we can get 16 relief from smog-forming pollution from these trucks and 17 buses. 18 Finally, cleaning up existing diesel makes 19 sense for our health and environment. By replacing diesel 20 with cleaner technologies makes even more sense. 21 Therefore, you should provide incentives to increase the 22 use of technology for buses and trucks. The health of Los 23 Angeles citizens depend on our efforts. Thank you. 24 MS. MARTIN: Thank you. Appreciate you being 25 with us here today. We can now hear from Mr. David 78 1 Freeman. 2 MR. FREEMAN: My name is Dave Freeman. I am 3 presently the general manager of the Los Angeles Department 4 of Water and Power. I served as an energy adviser to 5 President Jimmy Carter. I was present at the creation of 6 the EPA in the White House and remember the wonderful 7 feeling we had about creating this Agency and independent 8 -- completely independent -- of pressures for money and 9 polluters. 10 I served as the Chairman of the Tennessee 11 Valley Authority under President Carter. I have been a 12 fighter in the clean air fight from the very beginning. I 13 remember when the electric power industry said we didn't 14 know how to build scrubbers. The EPA said, damn it, figure 15 out how, and we did. 16 I think that I would say very candidly as a 17 friend of the EPA, you are much too timid. You are not 18 asserting the public interest with the fierceness and 19 dedication and focus with which this Agency was begun. 20 2007 is a long time off for these asthmatic children. 21 There is technology that could be developed and implemented 22 sooner than that that would get us off of oil. I think the 23 EPA should remember. It is part of the United States 24 Government which needs to have a crisper energy policy. 25 We are over 50 percent dependent on imported 79 1 oil and we need to learn that there is and can be life 2 after oil in this country. We need to get onto alternative 3 fuels that are both cleaner and domestically produced. It 4 seems to me that there's a lack of focus and concern and 5 crises that exists, especially in Southern California, and 6 nowadays in Houston and other places as to air qualify. 7 While these proposals that you have are 8 absolutely necessary as a step, they are wholely 9 insufficient. You ought to take your lead from the South 10 Coast Air Quality District and remember that EPA got 11 started because of the grassroots effort here in California 12 to create an Environmental Protection Agency. 13 I think you ought to take a few steps back and 14 ask yourselves, are you doing everything within your 15 statutory power to provide cleaner air for America sooner. 16 I think the answer is no at the moment. This rule 17 basically says that we can live indefinitely with the 18 oxymoronic phrase of cleaner diesel when your own 19 publications make it clear that diesel in any form is 20 spewing out cancer-causing particles. 21 We need to develop the fuel cell faster and 22 get vehicles powered by the fuel cells. Natural gas is a 23 fuel that can be used. There are other domestic fuels. 24 Let us have a rule from EPA that gets us off of diesel by 25 2007. Thank you. 80 1 MS. MARTIN: Thank you very much. I think we 2 will take your lead by now asking the South Coast Air 3 Quality Management District, Mr. Liu, to testify. Thank 4 you. 5 MR. LIU: I have a few slides here, actually. 6 My name is Chung Liu. I am the Deputy Executive Officer 7 for the South Coast AQMD. The District is very honored to 8 have the opportunity to be here to present our positions 9 at this time on EPA's proposed rules. In general we 10 support EPA's approach. The proposed rules go a long way. 11 We would also ask to expedite the schedule as 12 Ms. Freeman just mentioned, that air quality can be 13 improved faster, and we have shown that in the past and the 14 EPA knows the technology is here and we need to work 15 together to see if we can speed it up. 16 Also, I want to suggest to expand the proposal 17 to include nonroad engine emissions. There are three 18 principal concerns in terms of air quality from diesel 19 emissions. The diesel engines contribute significantly to 20 the nitrogen oxide emissions, which is a precursor for our 21 ozone problems here nationwide. Also nitrogen oxide 22 emissions contribute significantly to our fine particulate 23 matter as well as directly needed particulate matter. 24 Lastly, the concern is air toxics. 70 percent 25 of air conditioning systems caused by air pollutants are 81 1 contributed by diesel emissions. We need to work on all 2 three. 3 Any technology in any fuel can only address 4 part of the problem, not all the problems, and they are 5 clean and green. They are just now telling the truth. I 6 want to present some good news. South Coast has gone a 7 long way in the past 20, 30 years. The next slides we show 8 that we do sometimes have very clean air in our areas. 9 This is not a computer-generated picture. It is a real 10 picture. 11 This is a number of first-stage ozone 12 episodes. Number of episodes first stage in our basin 13 every year. As you can see, nobody can argue, we made a 14 quantum move. I think it is partially the answer to some 15 of the questions why South Coast always moves fast. The 16 results speak for yourself. We can challenge most of 17 the urbanized areas in the United States that may be 18 nationalized standards cannot achieve as much as localized 19 efforts. There's a local government in play here. 20 I challenge Houston or any other of those 21 areas that can have this kind of fast reduction in 22 episodes. We don't want to make other cities look bad. 23 But as a matter of fact, last year Houston took lead over 24 from us. We feel pretty very good about it. We are very 25 nervous about it because we are riding the borderlines of 82 1 first-stage episodes. This year we are looking very 2 closely. We had some high concentrations, but we still 3 maintain lower than Houston so far. 4 Some of you drive on the freeway close to Los 5 Angeles International Airport that know this wall on the 6 Highway 405 indicates "From Smog to Fog" is the commercial 7 by Air New Zealand. Actually you have to fly to London if 8 you want to escape smog. We want to escape from this image 9 and we will are getting there. 10 What is the problem from our South Coast point 11 of view. As you can see. This slide has been shown by 12 Dr. Alan Lloyd from ARB. NOx emissions principally 13 contributing to our basin by mobile sources. The red part 14 is onroad diesel. The yellow part is offroad diesels. 15 That's the reason we ask you to also consider your proposal 16 to extend to offroad category as soon as possible. 17 In terms of proposed EPA standard of PM 2.5 15 18 microgram per cubic meters, we have almost our entire basin 19 in violation of that standard by a long shot. Also, the 20 red part indicates our calculation. The contribution from 21 diesel source to that composition. We need a significant 22 restriction from both VOC and NOx in order to meet the 23 future in air quality standards promulgated by EPA. If the 24 eight-hour ozone standard and 2.5 ppm we need even higher 25 emission reductions. We are really struggling at this. 83 1 As you can see, the picture is probably 2 getting worse when you look at the most recent development. 3 We understand we significantly underestimated NOx emissions 4 and we need more reductions to meet the goal. Also, the 5 most recent settlement, probably years ago, the settlement 6 between the major engine companies, EPA, Department of 7 Justice and ARP really dealing with the engine skills did 8 not go back to really cut down the initial emission costs, 9 and we have come out short on those. 10 I want to concentrate a little on the air 11 toxics, which is the main driving force between the 12 efforts, and also the environmental justice issues and the 13 next slides will show why this is an A.J. issue to us. As 14 you can see, this picture depicts the diesel toxic effect, 15 the cancer risk, in our basin from air emissions. This 16 picture does not include the contribution from diesel. 17 This is the one with diesel. As you can see 18 the highest risk level is always associated with major 19 transportation artery, the freeways, the airports and the 20 sources of diesel emissions are very obvious. 21 The left side of the pie chart indicates the 22 cancer risk of 400 some from emissions other than diesel. 23 The right pie chart included diesels. I want to dramatize. 24 Benzine contributed a lot in the past when we don't deal 25 with diesel toxicities. In California we have gone a long 84 1 way in reducing Benzine. It is clear the next one is 2 diesel. 3 Very quickly, with the implementation we know 4 how to do it by 2010. With our implementation our air 5 quality management plans we can significantly reduce the 6 cancer risks, but diesel contributions are still in there. 7 Our current strategy really doesn't deal with the cancer 8 risk of diesel very effectively. 9 How can the region come into compliance with 10 the air quality standards. We need to implement the 11 technology. We know how. We also want to promote the 12 technology advancements. The transportation factor we have 13 to factor into our significant gross factor population and 14 travel. Also, we have to consider heavy-duty vehicles 15 really stay on the road for a long, long time. 20 years 16 most of the time. 17 I want to jump to two more slides. I think 18 EPA and DOE knows very well the data from the study 19 that indicates very clearly at this juncture the U.S. 20 understanding and the technology indicates that in order to 21 achieve 85 percent PM removal, we need 15 ppm sulfur. That 22 doesn't consider the problem of nitrous oxide. If you 23 consider that you need even more. 24 Basically we come to our recommendations. 25 Second is probably the most important one. That we know 85 1 there is a volunteer program in terms of retrofit. We 2 still want to consider EPA to consider retrofit part. 3 That's a portion of our problems and they will stay on the 4 roll for a long period of time. 5 This slide outlined why the South Coast has to 6 move faster. We need to meet our mandated time schedule 7 to meet ozone standards. We don't know how to do it 8 completely. Also, there's no emission benefit from this 9 proposed rule for us. We need PM standard by 2006. 10 Lastly, we need to reduce all the exposure as 11 possible. In our rulemaking process in the last several 12 months and made it amply clear the technology is there. 13 The Los Angeles County MTA actually during the process 14 asked their staff to come out to the plant to implement by 15 retrofit by 2001. If retrofit can be done done on buses 16 why cannot it be done on engines. 17 And also the City of Los Angeles by 2001 to 18 retrofit all their diesel engines. It clearly can be done. 19 We want to propose to EPA not only consider the typical 20 testing cycle. You got to consider the emissions 21 significant differences. We are talking about real 22 exposure, real toxicity here. 23 The next one. A lot of heavy-duty trucks in 24 urban areas have different transportation cycles. Those 25 communities, for example, school buses, transit buses, 86 1 refuse haulers, they are quite a different cycle going 2 through and they stop and go a lot. The temperature change 3 a lot. The performance of those PM trap technology really 4 needs to have a close look on this testing cycle. A 5 typical cycle just won't do. 6 The last slide, this is why we are doing it 7 partially. The trucks stay on the road for a long time. 8 We want to do something which will move fast. Thanks. 9 MS. OGE: Thank you. Mr. Sherman, good 10 afternoon. 11 MR. SHERMAN: Good afternoon. My name is 12 Scott Sherman. I currently teach at UCLA. Over the past 13 decade I have taught environmental courses at UC Berkeley 14 and at the University of Michigan before coming to UCLA. 15 One of the things that I found is that the statistics that 16 my colleagues here have been reading are very powerful. 17 But my students always react much more to a personal story 18 because statistics don't lead. You don't see the human 19 effects of these statistics. And, Dr. Barbers, you started 20 off your speech with a statistic. Can you state it again? 21 About 40,000 people in Los Angeles? 22 MR. BARBERS: With asthma are you talking 23 about? 24 MR. SHERMAN: Yes. 25 MR. BARBERS: Yes. 87 1 MR. SHERMAN: 40,000 Think about this in terms 2 of the Big One, the big earthquake that we are all afraid 3 of here in Los Angeles. The earthquake, if it were to hit 4 today, if it were to hit right now, we would declare a 5 state of emergency. We would immediately race to resolve 6 the problem. Everybody would take action. 7 But in an earthquake, I have lived through 8 several of them here in Los Angeles, in the average 9 earthquake far fewer people are killed or injured than are 10 killed or injured every single year by air pollution, by 11 soot, by diesel pollution, by unclean air. 12 Think about if a jumbo jet were to crash at 13 LAX this afternoon. Tonight on the news everybody would be 14 talking about how a jumbo jet crashed killing perhaps 300 15 aboard. But every year the equivalent deaths that occur 16 just in Los Angeles alone is equivalent to one of these 17 jumbo jets crashing approximately every couple of days. 18 That's why I urge that when we look at these 19 rules -- I agree with my colleague Mr. Freeman here -- I 20 applaud the EPA for those proposed rules. I think they are 21 wonderful. But I think we need to expedite them. I don't 22 think there is time to wait. 23 If you are in these communities where the 24 children are suffering from asthma. I grew up in the San 25 Fernando Valley. This is a place where you don't have to 88 1 die to go to hell. The pollution there is out of control. 2 Thanks to Mr. Liu and his colleagues, it is definitely 3 improving, but the situation is bad. People cannot 4 breathe. 5 I have read studies that showed that living in 6 Los Angeles is the equivalent of smoking several packs a 7 day of cigarettes. Every single one of us is going through 8 that. The problem is that this is not an emergency 9 situation, or at least we don't perceive it to be an 10 emergency situation. You can't breathe or you don't see 11 all this diesel pollution in an air conditioned ballroom 12 in the Hyatt Regency Hotel. Of course, there's indoor 13 pollution but we will have save that for another EPA 14 hearing. 15 We need to take this as an emergency. We need 16 to expedite the process. We cannot wait until 2007, 2010. 17 We can't satisfy ourselves with levels of 50 parts per 18 million. We have to have as clean air as possible and as 19 soon as possible. Thank you. 20 MS. OGE: Thank you. Mr. Angelo Bellomo. 21 Good afternoon. 22 MR. BELLOMO: Good afternoon. My name is 23 Angelo Bellomo. I've stepped in recently on an interim 24 basis to work with the L.A. Unified School Districts. And 25 I say that because when I walked in the door I was hearing 89 1 some stories about Belmar and some past decisions which the 2 District has made which clearly I have been on the outside 3 lobbing my own share of criticism on the District. 4 I am here today because I really believe this 5 is an area, and it has been adequately stated by my 6 colleagues. It is a problem that is long overdue in terms 7 of a solution. I think that the comparisons to earthquakes 8 and jumbo jets were good, but we can look for something a 9 little closer. And that is, the manner which we regulate 10 other forms of environmental pollution. 11 Our drinking water standards aren't set 12 anywhere near the levels of excess cancer risks. Even our 13 best efforts would achieve with regard to diesel exposure. 14 When we go to clean up hazardous waste sites or chemical 15 contaminants, we are looking at reduction of risks to the 16 point where we are less than one in a million. The numbers 17 that we see up on the board here, I am looking at thousands 18 and hundreds. It was really appauling when you think about 19 it. 20 I really applaud David Freeman's comments 21 about what your Agency was first put into effect to do. I 22 think we really have to get back to recognizing here that 23 the date that we are in with regard to diesel has more to 24 do with just the successful lobby that has existed for 25 many, many years and less to do with our ability to address 90 1 this problem. We have to move aggressively to do that. 2 I encourage the efforts you made on this 3 proposal. Please don't weaken and it don't back up. Those 4 of us in our respective areas will do our best to make sure 5 that these laws are complied with and that we are all doing 6 our share. Please stay aggressive on this one. 7 MS. OGE: Thank you. Mr. Richard Shyu. Good 8 afternoon. 9 MR. SHYU: Good afternoon. My name is Richard 10 Shyu. Executive Engineer for Government Technical Affairs 11 at Freightliner Corporation. I am here today on behalf 12 of Daimler-rysler, AG Powertrain Business Unit, 13 manufacturer of Mercedes Benz heavy-duty diesel engine. 14 My testimony will concentrate on the aspects 15 of proposed emission standards and new test procedures 16 affecting heavy-duty diesel engines. We will also be 17 submitting written comments for the record at a later date 18 and I ask that they be considered in a final rulemaking. 19 First and foremost, Daimler-Chrysler applauds 20 the Agency's recognition that fuels and technologies go 21 hand in hand in reducing emissions. Fuel should not limit 22 technologies. Fuel should enable technologies. The 23 Agency's proposal is an enabling step toward improving 24 quality across the Nation. It is with regard to EPA's 25 latest proposal that Daimler Chrysler would like to make 91 1 this oral comments. 2 Specifically, Daimler Chrysler has worked 3 diligently with the EPA and other regulatory agencies to 4 develop and bring to the market the best, technologically 5 feasible emission control technologies available for 6 heavy-duty diesel engines. Daimler-Chrysler intends to 7 continue this commitment to work with the EPA and other 8 concerned party in a context of this most recent rulemaking 9 effort. There are, however, certain aspects of the 10 proposed rule on which Daimler-Chrysler would like to 11 comment. 12 As the Agency stated in the NPRM manufactures 13 need ultra-low sulfur diesel fuels and lube oils to enable 14 NOx absorber and PM trap technologies to achieve the 0.2O 15 NOx and 0.01 PM proposed emission standards for model year 16 2007 heavy-duty diesel engines. The Agency also 17 acknowledged that the metallic ash content of the lube oils 18 may cause plugging of particulate traps. 19 While the Agency proposed to regulate sulfur 20 content for diesel fuels, it failed to do the same for lube 21 oils. Instead, the Agency proposed a voluntary program. 22 Daimler-Chrysler believes that once the Agency has 23 recognized the critical impact of fuels and lube oils on 24 the proper operation of the emission control equipment, it 25 is not appropriate to leave such factor to voluntary 92 1 programs. 2 Voluntary programs have the potential to 3 adversely affect not only the significant investments in 4 technologies, but also the air quality benefits expected by 5 the EPA, the states and the general public. Accordingly, 6 we will request that specific sulfur content for the lube, 7 oil be regulated as well. 8 The Agency did not propose to regulate the 9 ash, that is the sulfated ash of the lube oils. Daimler- 10 Chrysler data indicated that ash-plugging problems are 11 severe. Trap removal and mechanical blowoff of ash may be 12 required at an interval of every 100,000 to 150,000 13 kilometer of operation if this issue is not addressed. 14 When the ash blowoff schedule was not adhered 15 to an increase in exhaust backpressure and consequently 16 in fuel consumption will occur in combination with 17 insufficient regeneration of the trap. Daimler-Chrysler is 18 not advocating elimination of the ash-forming compounds, 19 which provide necessary antiwear and detergent/dispersant 20 properties of engine oil. 21 Therefore, it is necessary to seek a 22 compromise between performance of the oil, including drain 23 intervals, and the aftertreatment device interaction. We 24 recommend that the Agency investigate this issue further 25 and look to existing data concerning a proper balance of 93 1 the two factors. 2 For example, European Automobile Manufacturers 3 Association test sequences for engine oils and Mercedes 4 Benz specifications for engine oils already recommend 5 certain balances of sulfated ash for new technology 6 engines. We will provide more detailed comments with 7 supporting data with these and previously mentioned effect 8 of ash in written comment to the Agency by the close of the 9 commentary. 10 With regards to Daimler-Chrysler's second 11 concern, the Agency proposed not-to-exceed limit of 1.25 12 time federal transient test procedure standards under all 13 ambient conditions, without clearly defined test 14 procedures. For model year 2007, the proposed PM standard 15 on FTP is 0.01 g/bhp-hr. based on averaged weighted 16 composite cycle. This means, a PM measurement accuracy 17 required to comply with NTE limits may not be achievable 18 under current prevailing regulations. 19 Section 202b(2) of the Clean Air Act requires 20 that EPA to develop test procedures and measurement 21 techniques for the emission regulations promulgated. We 22 urge EPA to develop NTE test procedures and PM measurement 23 techniques adequate for the proposed standards without 24 further delay. We stand ready to cooperate with the Agency 25 in developing such procedures and techniques. 94 1 I appreciate the opportunity to testify on 2 behalf of Daimler-Chrysler AG, manufacturer of Mercedes- 3 Benz heavy-duty diesel engines. Thank you. 4 MS. OGE: Thank you, Mr. Shyu. I would like 5 to thank all the panel members with coming forward with 6 your testimony. I would suggest that we take not more than 7 10-minutes break. The court reporter would like to have a 8 break of a few minutes and we will be back in 10 minutes. 9 I would suggest by 10 of 1:00 for the next panel to be 10 here. Thank you. 11 (Recess ensued) 12 MR. OGE: Mr. Legre, good afternoon. We will 13 start with you. 14 MR. LEGRE: Thank you very much, Madam 15 Chairman. Good afternoon to the panel. We take this 16 opportunity to welcome you to the City of Los Angeles and 17 to report that rather dramatic improvements have been made 18 in air quality in this city over the past 20 years. We 19 also take this opportunity to register the point that we 20 realize much more needs to be done and we are committed to 21 that both locally and we presume you are nationally. 22 I am here today to speak unequivocably in 23 support of the EPA's proposal for more stringent national 24 standards for heavy-duty vehicles. The City of Los Angeles 25 recently completed its first round of public hearings on 95 1 the very issue of diesel impacts on air quality in the 2 South Coast Basin. 3 As Chair of the City Council's Environmental 4 Quality and Waste Management Committee, I heard through the 5 course of several hearings from engine manufacturers, fuel 6 providers, fleet operators of the environmental community, 7 educators and activists alike as well as concerned citizens 8 of whom you will obviously hear from today. 9 If one message was clear from that testimony, 10 it was that everyone believes that clean air must be 11 achieved and that to do so it will require leadership, 12 innovation, and perhaps more importantly, commitment. From 13 those hearings it was clear that a City policy needed to be 14 adopted on this issue. 15 Earlier this month, the Los Angeles City 16 Council did indeed adopt a clean fuel policy which included 17 support for programs and regulations that promote clean 18 and efficient vehicle technologies. Based on this newly 19 adopted policy, the City Council desired and did 20 demonstrate leadership by supporting not only the South 21 Coast Air Quality Management District's first three clean 22 fleet rules, but also committed to retrofitting all of the 23 existing diesel trucks with particulate traps and low 24 sulfur diesel fuel. 25 An important component of that decision, you 96 1 might say, is the recognition that in order to address 2 nonstationary air quality issues in the Los Angeles basin 3 where interstate diesel trucks are abundant, strong state 4 and federal standards are needed. Therefore, the City of 5 Los Angeles, again, strongly supports the EPA's proposed 6 heavy-duty vehicle standards and the sulfur control 7 requirements for diesel fuel. 8 We take this opportunity to urge you to adopt 9 such standards, reducing NOx by 95 percent below the 10 current standards and particulate matters is fundamentally 11 an important proposal worth our celebrating for those who 12 most need protection from air pollution, specifically 13 children, the elderly, and those with asthma and other 14 respiratory illnesses. 15 To further encourage municipalities, like that 16 of Los Angeles, unique though Los Angeles may be. To 17 encourage us to accelerate the purchase of new and use of 18 new, clean vehicle technologies in advance of new standards 19 taking effect, it would be my request that we consider 20 having the EPA develop a financial incentive program, such 21 as grants or a revolving loan program, or whatever else may 22 be available to you in that considerable pool of resources 23 at your disposal. 24 Early adopters of advanced clean vehicle 25 technologies, such as the City of Los Angeles must overcome 97 1 significant uncertainty about vehicle performance, 2 reliability and durability which frequently results in 3 higher costs, which obviously is discouraging and would 4 essentially impose a significant impediment to our 5 accomplishing our stated goals and/or objectives. 6 Demonstration and testing of these new 7 technologies are vital to ensuring that the technology is 8 feasible. We have got to know that it works. The downside 9 of it not working is not what any municipality, 10 particularly the City of Los Angeles is willing to endure. 11 While the City Council is not adverse to facing the 12 challenges that may be a precedent in making and it would 13 be essentially on a true commitment partnership on behalf 14 of the EPA if, in fact, we can begin an earnest 15 conversation about how this assistance could or should take 16 place or how it might then be provided. 17 Once again, I would like to thank you for the 18 opportunity to speak during the day and for holding one of 19 your hearings, one of five, next to the last hearing here 20 in the City of Los Angeles. We appreciate it very much. 21 MS. OGE: Thank you. Ms. Masters, good 22 afternoon. 23 MS. MASTERS: Good afternoon. My name is 24 Julie Masters. I am an attorney with the natural resources 25 defense council, which is an national nonprofit 98 1 environmental advocacy organization. I will be sharing our 2 time slot today with Gail Ruderman. On behalf of our more 3 than 400,000 members nationwide I would like to thank you 4 for this opportunity to comment. I would also like to note 5 that we did submit written testimony at the New York 6 hearing. 7 In our view, particulate matter and NOx 8 emissions from diesel exhaust are probably the most 9 serious air pollution threat facing many Americans today, 10 particularly in Los Angeles and other urban areas. 11 Although diesel vehicles make up only 2 percent of all 12 vehicles on the road today, they make greater than 50 13 percent of a demiparticulate matter and nearly one-third of 14 all the smog-forming NOx in urban areas throughout the 15 country. 16 We, therefore, applaud EPA for this ambitious 17 proposal to remove sulfur from diesel fuel and to clean up 18 the Nation's trucks and buses. The reasons for concerns 19 about diesel exhaust are clear. Diesel particulates along 20 with 40 other chemicals found in diesel exhausts are listed 21 with toxic air contaminants by the State of California. 22 Indeed, diesel exhaust is known to cause a 23 vast array of illness, including cancer, heart attacks, 24 asthma attacks, and other respiratory problems and it is 25 responsible for over 15,000 premature deaths every year. 99 1 Los Angeles faces some of the worst health risks from 2 diesel exhaust. The South Coast Air Quality Management 3 District recently concluded in its comprehensive two study 4 that over 70 percent of the cancer risk in the South Coast 5 Air Basin comes from diesel particulates. L. A. has been 6 found to rank first in estimated cancer cases caused by 7 lifetime exposure to diesel exhaust. 8 These proposed regulations if fully 9 implemented will have a profound effect throughout the 10 country and particularly in urban areas, such as Los 11 Angeles, in reducing smog, soot, and the negative health 12 impacts caused by dirty diesel exhaust. Some industry 13 representatives have argued that this rulemaking should be 14 delayed because they need more time. But the proposed 15 rules already have a seven-year delay built in and six-year 16 delay built in for the sulfur trap 2006 and 2007 before the 17 industry must comply with stricter standards. 18 Moreover, technologies that require low sulfur 19 diesel fuels exist today and are being commercialized and 20 used in Europe and elsewhere. Every year of delay on 21 industry's part means only more avoidable asthma 22 emergencies and more avoidable cancers. As for the 23 substance of the proposed rules, first strongly supports 24 a national sulfur cap of 15 ppm in mid 2006. We would 25 strongly oppose any level above that cap. 100 1 Just as lighter gasoline was a barrier to 2 cleaner cars the late 1970s, today's high sulfur diesel 3 fuel prevents the use of advanced emission control 4 technologies. Nevertheless, Some oil companies still argue 5 for a higher 50 ppm sulfur cap citing as reasons the 6 potential unavailability of ultra-low sulfur diesel and 7 inability to handle the costs associated with producing 8 low-sulfur fuel. 9 These companies claim that the same emissions 10 reductions can be achieved with this higher cap. These oil 11 companies represent a very small minority. First, not all 12 oil companies feel that way. PB and company enforce the 13 rule and announce that it will have sufficient quantities 14 to sell its 15 ppm sulfur fuel in California next year at 15 an incremental cost of only five cents per gallon. That is 16 without the economies of scale benefits of the nation-wide 17 sale of fuel. 18 Moreover, both the engine manufacturers and 19 emission controls manufacturers are arguing for a lower 20 sulfur cap of 5 ppm because they believe only a lower 21 sulfur fuel will ensure the emission reductions that they 22 need to comply with the rules. The California Trucker's 23 Association supports the 15 ppm cap because California 24 currently has more stringent sulfur requirements and a 25 national cap will level the playing field. 101 1 As for the cost of compliance to the oil 2 companies, America's largest oil companies reported nearly 3 $12 billion in profits in the first quarter of 2000 alone. 4 The cost of the rule are estimated to be $4 billion over 5 the entire ten-year span of the rule. More importantly, we 6 are talking about oil companies paying for the cost of 7 remedying the harms that their products have caused. It is 8 a cost they can bear and cost they should bear. 9 As for the cost to the consumers, some oil 10 companies said you could not take the lead out of gasoline 11 because consumers would never be able to handle the costs. 12 They were wrong. The price of diesel is expected to 13 increase only three to four cents per gallon. This 14 increase will not substantiually effect our nation's strong 15 economy. Following, this cap should not be implemented any 16 later than by 2006. Implementation by 2006 is feasible and 17 will ensure an adequate supply of fuel by the time the 18 emission standards kick in in 2007. 19 MS. RUDERMAN: Good afternoon. I am Gail 20 Ruderman. I am a senior attorney with the National 21 Resources Defense Council. First I want to emphasize, as 22 Julie did, that we commend EPA for all the work you have 23 done in developing this rule and proposing the rule that is 24 before us today. 25 What I would like to focus on in the remainder 102 1 of our time are the areas where we strongly recommend that 2 you strengthen the rules to help further protect the 3 communities and many of these have been pointed out by 4 subject of the earlier panels. 5 First is we urge you to implement all of the 6 portions of the rule no later than 2007. You have proposed 7 a PM standard for 2007, but the NOx levels you have 8 proposed are to be phased between 2007 and 2007, and we 9 strongly urge you to implement that portion of the rule by 10 2007. This weakens, as you know, our ozone attainment 11 level is 2010. We will have no benefits of your NOx 12 portion of the rule by 2010 if the first time -- we won't 13 have some sufficient impact of that if it is only phased-in 14 from 2007 to 2007 to 2010. If it fully implemented in 2010 15 it will make a big difference in this area. 16 We believe that the engine manufacturers can 17 bring you clean engines that achieve those NOx limits by 18 2007. The Air Resources Board has adopted a rule governing 19 transit buses which implements the stringent .2 gram NOx 20 cap by 2007. We believe that if California can do it, the 21 nation can do it, and that only covers transit buses. Our 22 hope is that all heavy-duty vehicles will have to comply 23 with this limit. 24 The second has to do with formaldehyde. The 25 Air Resources Board earlier raised with you that their 103 1 recommendations to reduce the formaldehyde standard to .01 2 grams per brake-horsepower-hour instead of .016. We too 3 join in this recommendation because formaldehyde is a very 4 troubling toxic air contaminant and we urge you to reduce 5 these levels. 6 The third issue is in-use compliance, another 7 areas that greatly concerns the environmental community. 8 Our concern is that you will have these wonderful standards 9 designed to protect the community, but under reality if 10 those levels are not achieved there will not be the 11 significant air protections you would otherwise would have. 12 And history tells us we have something here 13 serious to worry about. There are significant concerns 14 about the deterioration of heavy-duty vehicles in ashtma, 15 are greater than the certified emissions. Also, a variety 16 of duty cycles. We are very concerned that the current 17 duties cycle does not accurately reflect that urban transit 18 cycle or trash truck cycle or central business district 19 cycle. We were strongly encourage you to implement a 20 number of these use elements, including on-board 21 diagnostics. It is a requirement for cars. It should be a 22 requirement for heavy-duty vehicles. 23 In-use testing. There already are some tests 24 that have been done in-use which would give you a more 25 accurate reading of what the real world emissions are and 104 1 we would urge you strongly to make that compliant with your 2 rule. The third part is to develop duty cycles which more 3 accurately reflect heavy-duty bus and truck emissions and 4 various specific duty cycles. 5 The fourth has to do with offroad vehicles. 6 We strongly urge you, as have many others, to extend 7 your low sulfur limits of 15 parts per million to operate 8 vehicles. The oil refineries will have to retool their 9 operations to create a low sulfur fuel. We have these 10 benefits in the onroad sector. We should have them in the 11 offroad sector as well. 12 Lastly, fifth, is we strongly urge you to put 13 in provisions that push alternative fuel technologies as 14 well. In this region we need more than just cleaner 15 diesel. We also need alternative fuels and we need it now 16 because we have very serious toxic problems and very 17 serious particulate and ozone problems. And we encourage 18 you to include provisions to have other incentives to push 19 alternative fuels. 20 In conclusion, this is a critical moment in 21 history. You have an opportunity, you have the 22 environmentalist, the public health community, the public 23 teachers, you have the truckers, you have the control 24 manufacturers association, you have them all lined up on 25 one side saying go ahead with this proposal and a few oil 105 1 companies on the other side saying slow down. Please don't 2 slow down. Move ahead and adopt the rule. My time is up. 3 We hope that you go ahead and strenghten the rule to 4 protect our common Agency. Thank you. 5 MS. OGE: Thank you. Miss Garcia, good 6 afternoon. 7 MS. GARCIA: Thank you for the opportunity to 8 speak to you to today. My name is Nadine Garcia and I am a 9 member of the American Lung Association. One year ago on 10 July 7, 1999 I received a new left lung and with it a new 11 lease on life. 12 Before I had my lung transplant, my condition 13 was so bad I can't catch my breath enough even to brush my 14 teeth. I would not have been able to breathe enough to 15 come to talk to you today. Because I know first-hand what 16 it is like to gasp for air, I am here to ask you to clean 17 up dirty trucks and buses. 18 I have emphysema caused by a lifetime of 19 smoking. After I was diagnosed with the disease, I spent 20 nine years trying to catch my breath. For a person with 21 lung disease, air pollution makes breathing even more 22 difficult, if not impossible. I know that many of my 23 friends in the Better Breathers Club suffer terribly when 24 the air is bad outside. Some even have to be rushed to the 25 emergency room. 106 1 If you have never been able to breath, you 2 don't know what it's like. You can't imagine the terror a 3 person feels when they open their mouth and still can't get 4 any air. It is a feeling that I hope I would never 5 experience again. 6 But even with my new lung I notice that on bad 7 air days I feel the effects. I have to be careful and stay 8 inside if it is real bad. When a big truck or bus goes by 9 I try to avoid breathing in the black smoke because I know 10 what it does to the lungs. 11 Now that I have my new lung I want to protect 12 it. I want to live to see my 14 grandchildren grow up and 13 have families of their own and not die prematurely because 14 of air pollution. I want my friends who suffer from lung 15 disease to have hope that one day they, too, will be able 16 to breathe again. 17 We breathe some of the worst air in the 18 country here in Los Angeles. We have almost 160,000 19 children with asthma. 350,000 adults with asthma. 480,000 20 who suffer from chronic bronchitis and 55,000 with 21 emphysema. Even healthy people feel shortness of breath or 22 a burning sensation in their chest when the air is 23 polluted. We need to make diesel trucks and buses as clean 24 as cars. Please do not back away from your commitment for 25 a low sulfur fuel and new cleaner engines. If anything, I 107 1 urge you to consider moving up your schedule. Some of us 2 don't have seven to ten years to wait for cleaner air. 3 Thank you for your time and God bless you. 4 MS. OGE: Thank you for coming and taking time 5 from your schedule today to share your views with us. I 6 want to thank you for your patience. I understand you have 7 a medical appointment that you are putting off to come here 8 and testify. Thank you very much. 9 Mr. Bruce Bertelsen and John Mooney. Good 10 afternoon. 11 MR. BERTELSEN: Good afternoon. My name is 12 Bruce Bertelsen. I am the executive director of the 13 Manufacturers of Emission Controls Association. MECA is 14 pleased to present testimony in support of EPA's proposed 15 heavy-duty engine and vehicle standards and highway diesel 16 sulfur control requirements. We believe an important 17 opportunity exists to significantly further reduce 18 emissions from highway heavy-duty diesel engines by 19 utilizing an engineered systems approach that incorporates 20 and combines advanced engine designs, advanced emission 21 control technology and very low sulfur diesel fuel. 22 EPA's regulatory initiative recognizes the 23 importance of promoting the systems approach and the 24 Agency's proposal constitutes a carefully crafted and 25 balanced program. If the program is finalized, it will 108 1 result in substantial cost-effective emission reductions. 2 Indeed EPA's initiative will bring about the age of the 3 truly clean diesel engine. 4 MECA is a nonprofit association made up of the 5 world's leading manufacturers of motor vehicle emission 6 controls. Our member companies have over 30 years of 7 experience and a proven track record in developing and 8 commercializing exhaust control technologies for motor 9 vehicles. 10 Today I will briefly summarize MECA's position 11 on EPA's proposed initiative. We plan to submit more 12 detailed written comments prior to the end of the comment 13 period. I would like to focus my comments on two items. 14 First, the technological feasibility of the heavy-duty 15 diesel engine standards. And second, the critical need for 16 very low sulfur diesel fuel to meet those standards. 17 First with regard to the technological 18 feasibility. We believe the emission standards proposed 19 for heavy diesel powered heavy-duty engines can be achieved 20 in a cost-effective manner and within the lead time 21 provided if low sulfur fuel is available. EPA in it's 22 proposal identified two primary candidate technologies for 23 meeting the proposed emission limits. Catalyst-based 24 diesel particulate filters for PM control and NOx absorber 25 technology for NOx control. 109 1 Catalyst-based diesel particulate filters are 2 commercially available today. The only remaining 3 engineering effort is to optimist the filter systems for 4 the specific engine to which they will be applied. 5 Worldwide over 20,000 PM filters have been equipped on 6 diesel engines in a wide variety of applications. The 7 control efficiency performance and durability of filter 8 systems has been demonstrated. 9 Catalyst-based diesel particulate filters used 10 on engines operated on very low sulfur diesel fuel can 11 achieve PM and toxic hydrocarbon emissions well in excess 12 of 90 percent. When very low sulfur diesel fuel is 13 utilized, the level of particulate emissions is so low that 14 it is almost unmeasurable. Where diesel fuel containing 15 less than 10 ppm sulfur has been used, filter technologies 16 has demonstrated impressive durability. 17 Indeed, in some applications filters have 18 continued to provide excellent particulate removal after 19 600,000 kilometers of vehicle operation. Development and 20 optimization of NOx absorber technology is progressing at 21 a rapid rate and our members fully expect with the 22 availability of very low sulfur technology, this 23 technologys will be commercialized in 2007 for diesel 24 engines. 25 Indeed, the prospect that EPA will require 110 1 very low sulfur diesel fuel in a 2006 time frame has 2 already stimulated an increased commitment to bring about 3 their technology and to apply it to diesel engine 4 applications. Our members see no barriers to this 5 technology, again, provided very low sulfur fuel is 6 available. Rather the challenges are engineering in 7 nature. 8 Our members are making the substantial 9 financial investment in this technology because they 10 believe it will be commercially available. With regard to 11 the need for very low sulfur fuel, meeting a .2 NOx 12 standard and .01 PM standard over the full useful life of 13 an onroad heavy duty diesel engine as certified on a 14 combined transcient steady state certification test 15 procedures not to exceed emission standards will be 16 challenging. 17 As previously stated, however, we believe 18 these challenges will be met and the ultimate goal of the 19 truly clean diesel engine is possible. But, again, very 20 low sulfur diesel fuel will be needed. While we continue 21 to recommend that EPA establish a sulfur cap of 5 ppm, our 22 members believe that with a sulfur cap of 15 ppm, emission 23 control strategies can be developed to meet the proposed 24 emission limits. 25 Specifically with a 15 ppm cap, our members 111 1 are extremely confident that all catalyst-based filter 2 technologies will be designed to help meet the .01 PM 3 standard, and that NOx absorber technology will be 4 optimized to help meet the .2 NOx standard. At levels 5 above 15 ppm sulfur we doubt that the proposed standards 6 can be met. 7 In closing I would like to commend the Agency 8 again for its thoughtful and comprehensive proposal. I 9 want to indicate our commitment that if the standards are 10 finalized and if EPA adopts the sulfur requirements as 11 proposed, our industry is prepared to do our part to ensure 12 that the technology will be there to meet the desired 13 emission reductions. Thank you. 14 MS. OGE: Thank you. Mr. Mooney. 15 MR. MOONEY: Good afternoon. My name is 16 John J. Mooney. I am the Director of Technology 17 Development and Business Systems for the Environmental 18 Technologies Group of Engelhard Corporation. Engelhard 19 Corporation appreciates the opportunity to testify at 20 today's hearings and fully supports the testimony of the 21 Manufacturers of Emission Controls Association. 22 For 40 years Engelhard corporation has been a 23 leading developer and marketer of exhaust emission control 24 technologies for on- and offroad, light-duty and heavy-duty 25 vehicles, and other mobile and stationary source 112 1 applications. Engelhard Corporation is the inventor of the 2 monolithic catalytic convertor and three-way catalyst, both 3 of which are the key components of light-duty vehicle 4 emission control systems. 5 More recently Engelhard invented catalytic 6 system for hand-held two stroke engines used in environment 7 equipment and as well the premier catalytic system that is 8 applied to onroad vehicle radiator surfaces which destroyed 9 ground level ozone. 10 For diesel engine emissions control, Engelhard 11 Corporation makes and sells diesel oxidation catalysts, 12 catalytic soot filters and ceramic coatings for diesel 13 engine parts. Under intense development over the past 14 several years is our DPX product line, that is the 15 catalytic soot filter and catalytic-based NOx emission 16 control technologies, which include lean NOx catalysts and 17 NOx adsorber catalysts. 18 Engelhard Corporation believes that the 19 technological challenges posed by the US EPA heavy-duty 20 diesel engine 2007 rule proposal can be met. All that is 21 required is to provide a low sulfur diesel fuel with a 22 maximum 15 part per million sulfur cap. I thank you. 23 MR. OGE: Thank you. Mr. Herwick, good 24 afternoon. 25 MR. HERWICK: Good afternoon. My name is Gary 113 1 Herwick. I am with General Motors Corporation. I 2 appreciate the opportunity to speak to you this afternoon 3 on behalf of the Alliance of Automobile Manufacturers. The 4 Alliance is a coalition of car and truck manufacturers who 5 sell more than 90 percent of the vehicles in this country. 6 Alliance members are in the transportation business and our 7 interest in this rulemaking is to preserve diesel engines 8 as a power source option for the light-duty market. 9 As EPA recognizes, diesel engines have 10 inherent advantages with higher fuel economy, lower 11 greenhouse gas emissions, and a lower evaporative and CO 12 emissions. Diesel is one of the key technologies of the 13 future. 14 Considering concerns about fuel supplies that 15 have surfaced in this rulemaking, EPA should also consider 16 the potential overall fuel savings that would accrue if the 17 automakers are successful in introducing more fuel- 18 efficient vehicles. The PNGV program, Partnership for a 19 New Generation of Vehicles Program, estimates that its 20 advanced diesel technologies can achieve at least a 40- 21 percent gain in fuel economy over today's gasoline 22 vehicles. 23 Our members are working hard to advance the 24 state of the art in fuel-efficient diesel technology so it 25 will meet the tier two standards adopted last year 114 1 knowledge. But the most critical factor in this endeavor is 2 the quality of the fuel and especially sulfur. That is why 3 we applaud EPA for taking this crucial first step toward 4 enabling the next generation of diesel technology. 5 First, EPA treated the vehicle and fuel as a 6 system for both the existing and future use of fleets. 7 This perspective is essential for today's sophisticated 8 vehicles. 9 Second, EPA proposed to dramatically reduce 10 sulfur to enable the new exhaust aftertreatment technology. 11 Numerous research programs are showing how clean diesel can 12 be. Recent bus demonstration programs have diesel buses 13 with aftertreatment controls and clean diesel fuel are 14 proving as clean or cleaner on buses running on compressed 15 natural gas. This is truly a remarkable achievement. 16 Third, EPA proposed to introduce a new fuel 17 on a nationwide basis with a common deadline and very 18 limited exceptions. This approach is necessary to prevent 19 any high sulfur fuel from contamining the sensitive new 20 aftertreatment devices that will be used and it will help 21 ensure the diesel-powered trucks will continue to be able 22 to deliver their goods across the country. 23 Fourth, EPA proposed introducing the cleaner 24 fuel before the new aftertreatment technology must be used 25 on heavy-duty vehicles. To the extent the new cap leads to 115 1 early introduction of near zero sulfur fuel, it will 2 encourage automakers and suppliers to continue developing 3 and investing in this light-duty vehicle option. 4 As much of a stretch as the tier two standards 5 will be for gasoline-powered vehicles, they will be even 6 more so for diesel engines. The fundamental problem as EPA 7 recognizes is getting the vehicle's system to meet both the 8 NOx and the PM emission standards at the same time. Fuels 9 must be essentially sulfur free to allow diesel vehicles to 10 operate their cleanest throughout their useful life. 11 That is why automakers and engine 12 manufacturers from around the world have endorsed this 13 level in their recently updated worldwide fuel charter 14 which we have submitted for the record and which is also 15 available on our website. The charter defines sulfur-free 16 as between five and ten parts per million sulfur. Our 17 development data to date sports these levels. 18 Data from the Department of Energy and the API 19 and Engine Manufacturers Associations continuing DECSE 20 Control Program, Diesel Emission Control Sulfur Effects 21 program, also supports this definition of sulfur-free 22 fuels. The Manufacturers of Emission Controls Association, 23 which we just heard from, also continues to recommend 5 24 ppm. Notwithstanding its support for the proposed 15 ppm 25 sulfur cap. 116 1 Many people are assuming that the 15 ppm cap 2 may lead to an average sulfur level of as low as seven 3 parts per million with most of the fuel having less than 10 4 ppm due to the respected compliance margin. We are less 5 certain of this outcome. Rather we expect refiners may 6 learn how to shrink their compliance margins as our 7 manufacturers have done in new submissions compliance. 8 This could lead to more fuel above the 10 ppm 9 level which could seriously poison the new aftertreatment 10 devices. In addition to sulfur, EPA should also adjust 11 other fuel properties as recommended in the worldwide fuel 12 charter. We will discuss these issues further in our 13 written comments. 14 We think five to ten parts per million is 15 doable. After all, refiners are making this fuel today in 16 Sweden and elsewhere, as others have certified throughout 17 the hearing process. Other countries are moving quickly to 18 ultra-low sulfur fuels. Just last year, Germany adopted a 19 tax incentive program to encourage fuels with less than 10 20 ppm sulfur by 2003. 21 In May the European union announced it intent 22 to study a revision of its 2005 sulfur regulation to 10 23 parts per million for all of Europe. The key point is that 24 refiners know how to make clean diesel fuel. 25 At this point I would like to recognize Tosco 117 1 for its support of EPA's proposed sulfur limit, and I'd 2 also like to recognize ARCO and Equilong for manufacturing 3 smaller quantities of this fuel for demonstration programs. 4 Proper incentives and market demand will bring this fuel to 5 market even faster than public estimates predict. 6 We are at GBA to focus on its incentive 7 package to encourage to marketplace the make the new 8 cleaner fuel widely available as soon as possible. We 9 have heard concerns expressed about the business risks and 10 the potential supply shortages. We believe we understand 11 the business risks associated with increasingly stringent 12 mobile source emission regulations. 13 Indeed, we believe the new technology forcing 14 tier two standards constitute an even greater business risk 15 for a industry. We believe that fuel supplies will be 16 driven more by profitability and other factors and not 17 simply by the cost of this regulation. 18 We have come a long way in the debate over 19 sulfur. Just two years ago automakers petitioned EPA to 20 reduce the sulfur content of gasoline to the levels in 21 California or even lower. Today just about everyone 22 accepts the critical role that fuels and sulfur play in our 23 national environmental policy. The issue is no longer 24 whether to reduce sulfur. It is not even that near zero 25 sulfur fuels will eventually be needed. Rather, it is when 118 1 they will be available to enable a new technology. 2 For our part Alliance members want to bring 3 advanced technologies, such as the turbo-charged 4 direct-injection engine and hybrid-electric diesel vehicles 5 that are described in our new brochure, Advanced 6 Technologies, that you can all take a look at in our media 7 room just around the corner to the point where they can 8 operate cleanly and meet consumer demands. 9 The proposed 15 ppm cap on diesel sulfur is an 10 essential step forward and will provide incentive to 11 continue developing and investing in clean diesel 12 technology to make it one of our key options for the 13 future. Thank you. 14 MR. OGE: Thank you. Mr. Keller. Thanks for 15 you patience. 16 MR. KELLER: Good afternoon. My name is Glenn 17 Keller and I am the Executive Director of Engine 18 Manufacturers Association. Among EMA's members are the 19 principal manufacturers of the truck and bus engines 20 covered by today's proposal. Up front I want to make it 21 completely clear that EMA supports EPA's proposal as it 22 prescribes a path for achieving clean diesel technology. 23 As we sit here today, we are on the verge, the 24 critical turning point, of something spectacular. We have 25 within our grasp the potential to dramatically reduce the 119 1 emissions of the most fuel-efficient, reliable and durable 2 source of motor power available today that serves as the 3 backbone of our nation's transportation and delivery 4 system. The diesel engine can be as clean as, if not 5 cleaner than any other power source. It is capable of 6 meeting, emission standards significantly below today's 7 levels. And let me remind everybody that the emissions 8 from today's diesel engines already have been reduced by 9 over 90 percent. Yet we recognize that more, much more, in 10 fact, can and should be done to clean up diesel engines. 11 The key to accomplishing this feat is to 12 greatly reduce the sulfur content of the diesel fuel. 13 Further reductions in diesel engine emissions are going to 14 require much more than new engine designs and technologies. 15 As EPA appropriately recognizes, future remission 16 reductions require a systems approach involving the engine, 17 aftertreatment and the fuel to support them. In a sense 18 the future of clean low-emitting trucks and buses rests on 19 a three-legged stool. The stool will fall without all 20 three legs in place. One of those legs, fuel qualify, 21 enables the technology necessary to make the other two legs 22 stand. 23 Without removing essentially all sulfur from 24 diesel fuel, advanced NOx aftertreatment devices will not 25 be feasible. Advanced PM aftertreatment will be 120 1 prematurely poisoned, and engines will be exposed to 2 excessive wear, increased maintenance costs, and impaired 3 durability. I cannot emphasize enough the critical 4 importance of ultra-low sulfur fuel as the enabler for 5 achieving substantial NOx and PM reductions. Improved 6 diesel fuel also has a role in responding to potential 7 health effects concerns. 8 Ultra-low sulfur fuel lowers the total mass of 9 particulate from not just from the new engines but from the 10 entire fleet, and it enables the retrofit of known 11 aftertreatment technologies, such as oxidation catalysts 12 and catalyzed particulate filters, which can reduce the 13 organic and carbonaceous components of PM emissions. 14 Moreover, limiting the sulfur compounds emitted into the 15 air provides direct benefits in reducing the inventory of 16 harmful fine particles of sulfate in the air we breathe. 17 Sulfur and fuel is a poison. It ends up compromising our 18 air and also acts to compromise the performance of these 19 advanced aftertreatment devices we see. 20 We applaud EPA for recognizing the critical 21 role of fuel sulfur. We strongly support the need for a 22 uniformed nationwide low sulfur fuel standard with a hard 23 cap on sulfur content. Regional differences in sulfur 24 content will not allow the systems approach necessary to 25 meet EPA's very stringent NOx and PM emission levels. 121 1 Further, a hard cap on sulfur is critical. Averages simply 2 will not work. They are difficult and impractical to 3 enforce. Moreover, the engine and aftertreatment legs of 4 the stool must be assured of never being exposed to high 5 sulfur fuel. 6 In our view, EPA's proposal for a 15 ppm limit 7 does not go far enough. And fuel improvements should not 8 only be limited to trucks and buses. Nonroad fuels must 9 also be improved. We are aware of the various arguments 10 raised by the oil industry against improving fuel quality. 11 They don't want to reduce sulfur to even 15 ppm, let alone 12 to lower levels. Nation-wide ultra-low sulfur fuel can -- 13 no, must -- be achieved and it can be done cost effectively 14 without economic harm to either the oil industry or to the 15 trucking industry, the users of both our engines and the 16 oil industries fuel. We will provide detailed comments 17 on the need for ultra-low sulfur fuel in our written 18 submission. 19 So today we are enthusiastic, excited and 20 very hopeful about the future of the diesel engine and our 21 industries' ability to produce reliable, durable, fuel 22 efficient, high-performing diesel engines that also are as 23 clean or cleaner than any other power source. There are 24 issues which will require a great deal of work by 25 manufacturers and the Agency. But it is no longer a 122 1 question of if. Give us fuel improvements, sufficient 2 time, compliance flexible and testing certainty, and 3 tremendous emission reduction can be achieved. 4 If you have any questions, I would be pleased 5 to answer them. 6 MS. OGE: I have two questions for Mr. Gary 7 Herwick. In an effort to move forward, because we are 8 running late, I would appreciate it if you could submit any 9 written comments that you have for the record. You made 10 two statements that I wanted to follow-up. One had to do 11 with addressing other parameters with the fuel with sulfur. 12 We would encourage the Alliance to provide any data that 13 you have that will suggest the environmental benefits and 14 the effects of aftertreatment technology. 15 The second issue that you mention in your 16 testimony is for the Agency to consider incentives in order 17 to see that cleaner fuels are introduced in the marketplace 18 earlier than 2006 time frame. We would appreciate any 19 specific recommendations that you have on this issue. 20 Thank you. 21 MR. HERWICK: You are not asking me to respond 22 now. You would like written comments on those? 23 MS. OGE: Please. Any questions for the 24 panel? I would like to thank you all for coming forward 25 and also for being extraordinarily patient. We have more 123 1 people coming forward to testify than we had planned. We 2 are willing to go through our lunch and our dinner as long 3 as it takes to listen to everybody who has a statement to 4 make for the record. Thank you very much. 5 I will call the next panel. We are about an 6 hour behind schedule. I hope that we can pick up some 7 speed here. I would like to call Reverand Terry Van Cook. 8 Mr. Ron Milan, and I believe he is accompanied by Ms. Nina 9 Solomon. Ray Edrasian. Bahram Fazeli. Mr. Greg Vlasek. 10 Dr. Kirk Murphy. Miss Vanessa Lynn. Miss Cynthia Rojas. 11 And also I would like to call the following individuals if 12 they are still here, please come forward. Mr. Bob Massman, 13 Mr. Mike Williams and Mr. Bill Burgemaster. Please print 14 the names on the cards placed in front of you. 15 Reverand Van Cook, welcome and good afternoon. 16 MR. VAN HOOK: I am Dr. Terry Van Hook, Pastor 17 of the Culver-Palms United Methodist Church in Culver City, 18 California. I am here both as a private individual but 19 also as someone who represents a large group of individuals 20 concerned about this issue. I do want to thank you all, 21 especially the EPA, for the 30 years of hard work work to 22 clean up the air the other 23 areas of pollution and for coming and meeting us here in 24 Los Angeles. 25 I remember the years here in L.A. when the 124 1 smog season was in force and it seemed like the San Gabriel 2 Mountains had been mysteriously moved away for the summer. 3 Those days are fewer. We heard testimony on that earlier. 4 I thank God for that. And also I thank God for your 5 working for the State of California and for all the people, 6 the enumerable people, who have worked for over 30 years to 7 wrestle with these environmental issues. 8 I also remember that it took a child choking 9 in an airplane for me to wake up and see what was going on. 10 In the days before the airliner's smoking ban, a man 11 smoking a cigar in coach put a nearby child into an 12 asthmatic fit. But the tearful mother did not get through 13 to him to have him somehow stop or even move. He was 14 completely unconcerned over the consequences and refused to 15 extinguish his cigar. The mother's tearful plea had no 16 effect. He saw nothing wrong. He didn't feel that he 17 wanted to waste the money he had spent. 18 Finally, a very courageous flight attendant 19 came and confronted a man with a sick child sitting behind 20 him, and that finally resulted in the cigar being 21 shamefully put out. Your Agency has taken on the role of 22 being such a courageous public servant, and I thank you 23 again for that. 24 Today the issue is sulfur and the other 25 pollution in diesel fuels that are before us. I ask you to 125 1 look simply beyond being that public watch dog and to see 2 instead the larger picture of what we are engaged in. A 3 hundred years ago when the internal combustion engine was 4 new and exhaust gases were just invisibly mixed with the 5 dust that followed with the wait behind the car or truck, 6 there was no knowledge of the immense damage to lungs and 7 health that such pollution would cause. 8 Yet even then anyone living would have been 9 morally appauled as someone came and proposed that had we 10 start an industry that would end up dumping 3 million tons 11 per year of dangerous particulate matter through our air as 12 a result of their business. This, as we have learned, is 13 what the current diesel engines, as improved as they have 14 been -- and I do recognize that as well -- contribute to 15 our atmosphere today. 16 Such a proposal like that would be shamefully 17 laughed out of town, especially when we learned that a high 18 percentage of those particulates end up in our children's 19 lungs. It would be as if we lit up 20 cigars in a closed 20 cabin of coach in an airline. We have made great strides 21 in undoing the damage that we ourselves have done over the 22 last hundred years. But the final goal will still elude us 23 if we continue to think only of the economic cost to the 24 producers of the oil and the economic cost of the refining 25 and other processes that go into reducing sulfur. 126 1 If we ignore the economic and human and even 2 spiritual cost to the consumers of this pollution, and, 3 yes, there are consumers of pollution. We can easily call 4 everyone, the men, women and children, who have to follow 5 along behind the particulate-generating engine, an 6 unwitting consumer of pollution. We can easily call those 7 who live alongside the roads that particulate-generating 8 engines travel unwitting consumers of pollution. 9 We can easily call those who play and work 10 downwind, sometimes miles downwind from the highways and 11 byways of the particulate-generating race on unwitting 12 consumers of pollution. All these sources of pollution 13 often seem uneffected by the waste stream that they leave 14 in their wake and would rather save a few pennies per mile 15 than be morally responsible for their actions. 16 The unwitting consumers of pollution are all 17 the unseeing human beings of greath worth that pay the cost 18 of those few pennies with their health. The reality of the 19 big picture is that every engine, every industry that has 20 an exhaust pipe or has a smoke stack or some other way of 21 venting pollution to the air, is using the air we breathe 22 as their free garbage dump. They continue to take 23 advantage of the fact that no one owns the air. They are 24 exploiting a God-given resource as a cheap and inexpensive 25 way to expose of their unwanted chemicals. It is only fair 127 1 that we ask this to stop. 2 I know you know this. We all know this. It 3 is just that we lose sight of it at times. I hope that 4 what we do here today and in the continuing efforts of the 5 EPA to return to a common agreement, a common sense 6 conclusion that we are in this all together, we are a 7 community together. Not a group of individuals that need 8 to be policed or coerced into doing the right thing. 9 That we are a nation seeking to live in peace 10 and justice in respect and dignity for each other. That 11 whether we are young or old, rich or poor, none of us 12 should be required to breathe the byproducts of someone 13 else's industrial process and, therefore, pay a personal 14 cost of disposing of the waste that they create. That's 15 the bigger picture before us today. 16 As members of the EPA, you have the power to 17 set the policies to hold us to the goals and dreams of 18 clean air, not just partially clean air. To have the 19 picture of the use of each other completely in our past and 20 to have the picture of the use of nature as places to dump 21 our byproducts eradicated. 22 I know that God weeps when God sees us using 23 each other in such disrespectful and destructive ways. I 24 ask you and all who are here today to remember our sacred 25 words from God and our honorable covenant as Americans, to 128 1 take each other into account, to care for each other as our 2 nation has tried to do in its whole history. I ask to you 3 work hard to restore not just our land and air water, but 4 to restore our morals, spiritual and physical health as 5 well. 6 That is the higher calling of the EPA. It may 7 not be written in your mission statement but it must be 8 written on your hearts. We can be moral leaders as well as 9 political leaders. The two are not exclusive. I know you 10 know this. Don't lose your focus. Don't let us down. 11 Thank you very much. 12 MS. OGE: Reverand Van Cook, thank you very 13 much. I would like to call Mr. Bahram Fazeli. 14 MR. FAZELI: Good afternoon. My name is 15 Bahram Fazeli. I am representing Communities for a Better 16 Environment. Communities for a Better Environment is a 17 state-wide environmental health and justice organization 18 that relies on organizing legal advocacy and technical 19 research to assist communities in voicing their demands 20 and influencing policies that influences their health. 21 We belong to a rapidly growing local, 22 national, and international movement that demands corporate 23 responsibility. The majority of our members who living in 24 lower-income communities of color have become increasingly 25 aware that they are carrying more than their fair share of 129 1 pollution in their communities. People of color and lower- 2 income communities have become increasingly aware that they 3 are targeted by stationary and mobile sources of pollution, 4 with diesel being among the worst of these toxic air 5 components. 6 Particularly children, pregnant women, elderly 7 and people with poor health who live along the Alameda 8 Corridor in the South Coast Basin have and will continue to 9 suffer the increasing effects of pollution, especially 10 diesel traffic, infecting them with acute and chronic 11 circulatory and respiratory illnesses. There's a section 12 in the City of Highland Park where our offices are located 13 that the district the people refer to as Asthma Town 14 because there are proportionately high rates of asthma 15 among the children. 16 People of color in lower-income communities 17 and especially children continue to suffer because we as a 18 society rely on an economic model of growth that is 19 polluter-friendly. The regulatory vision of those who set 20 public policy has long been distorted by an obsolete model 21 of growth that neglects the respects of the responsible 22 growth on the health of humans and the environment. 23 We are yet to see the implementation of the 24 model that internalizes the real cost of pollution. A 25 model that emphasizes prevention over last-minute district 130 1 measures secure, and a model that emphasizes welfare of 2 human health over rights of polluters to expand. Too long 3 we have lived by the motto of expand now and breathe later. 4 And too long communities of color and especially children 5 of these communities have become the yellow canaries of bad 6 economic habits of polluters that seem to only profit a 7 few. 8 We are glad to see that EPA is taking a series 9 of steps in improving the health of our communities. We 10 commend the EPA for what we consider the first of steps in 11 a series of steps that needs to be taken to improve the 12 quality of air in our communities. We support the 13 amendments that were proposed by National Resources Defense 14 Council and other environmental groups to strengthen the 15 rule and we urge EPA to implement the rule without delay. 16 Thank you. 17 MR. OGE: Thank you. Mr. Ron Milan, welcome. 18 MR. MILAN: My name is Ron Milan. I am the 19 Executive Director of the Los Angeles County Bicycle 20 Coalition. We are a coalition of cyclists throughout L. A. 21 County working to make the streets safer and more enjoyable 22 for people to ride a bike, both as an alternatives means of 23 transportation and as a means of recreation. Oftentimes 24 they are both recreation and transportation. 25 We are working really hard to make the streets 131 1 safe for cycling and we are really thrilled about this 2 proposal. We support it. And we are supporting it because 3 cyclist bear a brunt of this problem of fuels as well. I 4 can speak on behalf of cyclists. I work downtown and 5 there's nothing worse than biking on the streets and being 6 behind one of the diesel-spewing buses of the MTA. I play 7 a little game. I ride behind it and I try really, really 8 fast to get ahead of the bus and I then I have some fresh a 9 for I little bit, and sometimes the bus gets ahead of me 10 and I have to be behind the bus again. It is dreadful. 11 We are working to make the streets not only 12 safe for cycling, but the fewer buses we have that are 13 polluting, the more people we think will get out there and 14 bicycle and not use any fuel at all. Once cyclists have to 15 sit behind the buses and also in general the air quality 16 make it tough for cycling. Biking on a day that has too 17 much smog, too much air quality problems is not fun either, 18 and it keeps a lot of people indoors. 19 We believe that L.A. County has a lot of 20 potential being a great place to bike. We have flat 21 terrain and great weather year round. Too often the air 22 quality is no good and being behind buses is no good. We 23 applaud your proposal. We think it can be strengthened and 24 we agree with NRDC who has put forth some other suggestions 25 and amendments. So not only should we pass this proposal 132 1 with the amendments, but let's implement it and we would 2 like to help you implement it. 3 Thank you so much for doing all this. If I 4 have any time left, I think there's a Nina Solomon. I 5 would like to donate my time to her. 6 MS. DRAY: Hello. Good afternoon. My name 7 is Dr. Rae Dray (phonetic) and I am a toxicologist and 8 biologist. I am actually speaking on behalf of a 9 Neighborhood Association. We call ourselves Neighbors for 10 a Safe Environment, NASE. We would like to take this 11 opportunity to bring to the attention of the EPA about a 12 situation in our residential community. 13 This is in the west side of Los Angeles. 14 There is an oil and gas drilling site in the midst of this 15 residential area. In fact, the facility is within hundreds 16 of feet of four schools, so it is a neighborhood where 17 there's a great concentration of children, there's a great 18 population of the elderly, and it is a walking community. 19 There are a lot of people that traverse the streets. 20 This oil company, Briper Energy Company, has 21 filed an EIR and is proposed to expand their facilities. 22 And their guise of expansion is basically in terms of what 23 they are calling a modernization. In fact, they are using 24 a diesel-powered rig which is on a mobile platform to do 25 their oil drilling and maintenance work. They want to get 133 1 rid of this diesel rig and transform it into an electric 2 rig. 3 However, in the process they are going to be 4 going to a 365-day a year schedule so that there will be 5 lots of diesel trucks that are coming into the facility and 6 adding this diesel pollution to the area. We definitely 7 applaud what the EPA wants to do in terms of cleaning up 8 the diesel. If this diesel rig that they currently have 9 could be cleaned up, they would probably not have to do 10 this expanded operation. 11 The other point that we need to bring to your 12 attention is that even though the EPA has categorically 13 stated up front that this is a major polluting facility and 14 has urged the local agencies to enforce and issue permits, 15 the local agencies do not because it falls through the 16 cracks. Since this is a mobile unit, it is not permanent, 17 The AQMD does not have a rule. The EPA is not being 18 forceful enough, we feel, in demanding that the local 19 agencies make rules to, in fact, enforce these types of 20 facilities. 21 I would like to ask Nina Solomon to give you a 22 few more remarks. 23 MS. SOLOMON: The only thing that I wanted to 24 add is that there is often a conflict between local 25 government and business. In our case, there's a perceived 134 1 notion that you need to appear to be pro-business in Los 2 Angeles, and as a result we have suffered greatly because 3 of that. We are hoping along with your proposal will come 4 enforcement. 5 One of the major issues always is enforcement, 6 and in this case this particular facility is considered 7 both stationary and nonstationary. I think it is unique, 8 perhaps, the concept is unique. As a result it falls 9 through all the cracks for enforcement. We are hoping that 10 you will look at that aspect as well. 11 MR. OGE: I would like to thank you both of 12 you. If you could give your names and phone number to the 13 receptionist, I will have our regional staff that are 14 responsible for the State of California to call up both of 15 you. Thank you. 16 Mr. Greg Vlasek, good afternoon. 17 MR. VLASEK: Thank you. Good afternoon. I 18 am Greg Vlasek. I represent the California Natural Gas 19 Vehicle Coalition in Sacramento. We are an advocacy 20 coalition of 35 fuel providers, light-duty vehicle 21 manufacturers, fleet users of natural gas vehicles, and 22 heavy-duty engine manufacturers and technology companies. 23 We are here today in the house on the debate 24 over diesel to support the proposed EPA diesel sulfur 25 reduction and heavy-duty engine standards as proposed and 135 1 the like many of the prior speakers we see opportunities to 2 actually strengthen and improve upon these proposed 3 regulations. 4 The Natural Gas Vehicle Industry is here 5 because these new future engine standards level the playing 6 field for other maturing technologies that can compete with 7 diesel. That includes natural gas engines and trucks and 8 future technologies, such as fuel cells, hybrid 9 technologies, and so on. 10 We are talking about leveling the playing 11 field in two ways that have already been touched on. One 12 is geographically. California is already committed to 13 starting down this path to clean diesel fuel and cleaner 14 trucks. From a competetive standpoint from our trucking 15 industry, it is very important that this become a national 16 program because we do have so many trucks coming in from 17 other parts of the country, and if the standards are not 18 equalized at some point, there is no hope whatsoever that 19 California nonattainment areas will be able to achieve 20 attainment in the time frame required. 21 The other leveling effect is in the area of 22 technology. There has been a big debate here and that 23 debate will continue over what is the appropriate sulfur 24 content of diesel fuel in order to be able to apply these 25 new technologies. Should it be 50, should it 20, 15, 10, 136 1 5, where should it be. I even heard 5 to 10 ppm sulfur 2 characterized as sulfur-free diesel fuel for the first 3 time. I am not sure exactly where that leaves natural gas. 4 Natural gas in commercial pipeline grade that 5 ranges from about two to four ppm sulfur. That is with no 6 incremental processing cost to either the fuel provider or 7 ultimately to the consumer. What that does is it enables 8 natural gas technologies to take advantage of all these 9 diesel aftertreatment technologies that are being discussed 10 and to do so in a way that is very cost effective. 11 That is appropriate because currently natural 12 gas engines and trucks have such a very minute fraction of 13 the market. There in no way that we can develop those 14 technologies separately without the diesel engine 15 manufacturers stepping up to do the development. But 16 anything that they do to improve on diesel engines is going 17 to be transferrable to natural gas engines and make them 18 cleaner as well. 19 Along with ARB and the California Trucking 20 Association and South Coast AQMD, we would agree that we 21 ought to be really talking about inclusion of all diesel 22 fuel, not just onroad truck fuel. As the ARB pointed out 23 at the beginning of the day today, up to 55 percent of the 24 NOx inventory is from offroad sources. So why when we have 25 the opportunity in a seven-year lead time to effect new 137 1 fuel standards and new technology standards, why would we 2 not be looking at agricultural engines, construction 3 engines, locomotive engines, marine engines, and so on that 4 all contribute very dramatically to the inventory in 5 California and other nonattainment areas, particularly in 6 the Central Valley where I come from. 7 We would also support the concept of a more 8 aggressive phase-in schedule. These new engines and new 9 fuel are needed sooner rather than later for health 10 reasons. We believe in too much stock is currently being 11 placed, particularly here in California, in the possibility 12 of low sulfur diesel retrofit technologies. While some of 13 those things do appear to show promise, we have very strong 14 concerns about how well those things will perform in use 15 when there is no engine manufacturer to back up the 16 combined engine and aftermarket retrofit technology being 17 properly integrated. We don't see anybody stepping up to 18 fill that void to make sure that the retrofit technologies 19 really do work in use. 20 The Engine Manufacturer's Association 21 testified here today and testified elsewhere that diesel 22 engines can be as clean or cleaner than any other power 23 source. I presume that to include natural gas 24 technologies, fuel cells and the like. I think those 25 familiar with engine certification data and in-use 138 1 emissions data as opposed to lab data know that diesel 2 engines have a long way to go and natural gas is the clear 3 leader in heavy-duty engines emissions technology. 4 If the EPA says that diesel manufacturers can 5 be cleaner than natural gas and fuel cells, let's hold them 6 to it with these regulations and give them the fuel they 7 need to achieve that. The petroleum industry's argument 8 seems to be reducing public cancer risk is not worth the 9 cost of retooling their infrastructure to supply that clean 10 fuel. And the vehicle control technologies might not work 11 anyway. They seem to have very little confidence in the 12 advanced diesel technologies. 13 If that's true, it is all the more reason for 14 EPA to adopt these new standards and to encourage heavy- 15 duty engine manufacturers to accellerate their 16 commercialization of natural gas engines and other 17 technologies that can delivery the results and can deliver 18 the clean fuel. Remember I said natural gas is already 19 below any proposed standard for sulfur and diesel. Three 20 ppm with no added cost to the provider or the consumer. 21 Finally, I would like to interject some 22 caution on the selective catalytic reduction technology 23 that has been discussed as a heavy-duty truck emission 24 strategy. CTA, California Trucking Association, hinted 25 earlier at some of the practical problems associated with 139 1 this. Selective catalytic reduction technology, that is 2 using ammonia or urea as a reagent in the catalyst process 3 to reduce NOx has been used in stationary engine 4 applications by California gas utilities for nearly 20 5 years. About as long as I have knowledge in the natural 6 gas industry. 7 You need for watch this very closely and to 8 talk with your stationary technology people about this 9 because this is a very, very sensitive technology that 10 requires extremely careful control that is hard to achieve 11 in the real world and very hard to achieve with a transient 12 mode engine. The predictive modeling for proper injection 13 is very hard to maintain. We found that even on stationary 14 engines that do have predictable load shifts, unlike a 15 diesel truck or a bus, as was testified earlier, this 16 technology can actually quite easily, if not properly 17 managed or monitored, can result in increases in the 18 emissions of toxins and NOx, aside from the practical 19 problems of using that kind of material. 20 Again, in-use compliance associated with that 21 technology is an issue of very large concern because of the 22 reasons mentioned. That's all I have. I appreciate your 23 time. I would be happy to answer any questions you might 24 have about natural gas technology. 25 MS. OGE: Thank you for coming. I would like 140 1 to welcome Silene, Julia and Erasmo. Good afternoon. One 2 of you will speak or all of you? If you can state your 3 name for the record and you can proceed. 4 MS. PARAMEDEZ: Good afternoon. My name is 5 Silene Paramedez. I represent Beaumont High School 6 Environmental Club. By being in an environmental club we 7 are trying to make a difference in our community by getting 8 involved in as many activities as we can. Today we found a 9 problem which is air pollution. Air pollution is caused by 10 power plants and multiple usage of cars. 11 The one way we can prevent air pollution is 12 there are a lot of people that use cars so we can use 13 carpool cause there's a lot of people that live near each 14 other and it will make a difference if we carpool. We key 15 share in carpool together. Why have more pollution if we 16 can travel to one place together. We are trying to tell 17 people that air pollution is not healthy and we should make 18 a difference and try to prevent it. 19 MR. OGE: Thank you, Silene. 20 MR. FUENTES: Good afternoon. My name is 21 Erasmo Fuentes and I am also a Belmont Student and also a 22 member of the Environmental Club. As you all know, I would 23 like to thank you, the EPA for giving me the chance to 24 speak here today. Pollution is a big problem in your 25 community. Everyday children with asthma are being sent to 141 1 the emergency room because of severe asthma attacks. 2 I know because I had experienced a couple of 3 asthma attacks in the past. One of the reasons the doctors 4 gave my parents was because of the high smog and the 5 pollution in the air. I would like all of you to make 6 stricter regulations in the pollution because it is needed. 7 It is no fun having asthma. I would also like to thank the 8 EPA for trying to make the difference in the lives of 9 asthmatics. 10 MR. OGE: Thank you, Julia. Good morning. 11 MS. MUNOZ: Good afternoon. My name is Julia 12 Munoz from Belmont High School. I represent not only 13 myself but also I represent the future. In other words, if 14 pollution continues, there's practically no future. Many 15 of you have experiences that extremely heat has been 16 increasing, that is given to the air pollution and all 17 that. It changes our climate. It not only changes our 18 climate now but will eventually change the future. I 19 would love to be in the future and I am planning for it. 20 However, the air pollution has prevented me 21 for doing so. I would also like to talk about have you 22 ever experienced being in the back of a school bus. When 23 the school bus takes out it bursts out a lot of gas and 24 contamination out of its pipes. Once when I was a little 25 girl I was in the back of a bus and it was a bad 142 1 experience. 2 In the future that's how we are all going to 3 be breathing. Imagine yourself being in the back of a 4 school bus breathing that air. Basically in the future the 5 way I see it as is wearing gas masks all the time when we 6 go out. Even to go out like we say now to breathe some 7 little air, we have to grab our gas mask and go outside. 8 In programs such as the environmental program 9 at our school and also AOP is trying to make a difference. 10 However, we still need stricter laws. We all enjoy the 11 car. I do enjoy my car and I don't really enjoy walking. 12 However, if we don't start doing something about it, we 13 have to realize we are destroying it. We are destroying 14 our environment. But we might think we are that doing bad 15 to ourselves, but we actually are. We are not making a 16 future. 17 Thanks a lot for us all of us who are trying 18 to make a difference. I know I will be trying to make a 19 difference as well in the future. Thanks a lot for hearing 20 me. 21 MS. OGE: Thank you Julia and thank all the 22 panel members. You are the reason we came to Los Angeles 23 and we are not holding this public hearing in Washington. 24 We are traveling across the country to get the views of all 25 affected. Especially concerned citizen like yourselves. 143 1 Thank you for coming forward. We will start with our next 2 panel. 3 Mr. Craig Moyer, Mr. Alan Cabodi, Mr. Chad 4 Tuttle, Mr. Steve Farkas, Dr. Gary Herbertson, Duane 5 Bordvick, Dan Jacobson, Clara Rosenthal and George White. 6 If you can state your name and affiliation, we 7 can start with you. 8 MR. MOYER: Craig Moyer with the law firm of 9 Demetriou, Del Guercio, Springer and Moyer in Los Angeles. 10 I am speaking today as the general counsel and executive 11 director of the Western Independent Refineries Association. 12 We have on this panel four WIRA members and I want to 13 support their comments and try to coordinate so we didn't 14 have repeats on here. But there's no federal rulemaking 15 that is more significant to small refiners today. 16 WIRA a trade association representing the 17 interests of the 11 small refiners still operating on the 18 West Coast. WIRA is a trade association of those small and 19 independent refiners who have been long-recognized as an 20 important competitive force in the refining sector. The 21 small and independent sector of the refining industry is 22 integral to maintaining competition. 23 In addition, small and independent refiners 24 also supply other petroleum products not otherwise 25 available in certain areas. For example, small refiners 144 1 manufacture 100 percent of California's grade aviation 2 fuel, allophatic solvents and JP4 jet fuel. Small refiners 3 also manufacture 100 percent of the asphalt produced in 4 Southern California and most of the offroad diesel. 5 Congress and many agencies, including United 6 States EPA and the California Resources Board have long 7 recognized the importance of the independent refining 8 sector to maintaining a competitive market for petroleum 9 products. There are five West Coast small refiners that 10 are currently today making onroad diesel fuel. Diesel fuel 11 is a very important product to small refiners. 12 There is substantial precedent I would like to 13 remind you of for small refiners separate treatment, 14 including the diesel fuel acid rain credits and the Clean 15 Air Act Amendment of 990. I would like to recall the 16 gasoline rulemaking here in California in 1991 to analyze 17 the implications of a major fuels reformulations on the 18 ability of small refiners to survive. 19 The point is to consider not only the impact 20 on small refiners, but also on the competitiveness in the 21 marketplace. The California Attorney General recently 22 found that the elimination of several small refiners from 23 the gasoline market during the 1990s in California 24 contributed to the lack of competition and increased the 25 price spikes that we have seen in gasoline here in 145 1 California. 2 I would like to begin the substantive comments 3 by expressing WIRA's complete and utter support for your 4 proposal on engine emission standards. Additionally 5 because it appears that ultra-low sulfur diesel fuel is 6 necessary for engine manufacturers to be able to meet those 7 standards, WIRA supports the need to dramatically reduce 8 the sulfur content of diesel fuel. 9 Today we are proposing a 30 ppm average sulfur 10 content for diesel fuel. That is a reduction of 94 percent 11 from today's standards. As compared to 15 ppm, we believe 12 that a 30 ppm average sulfur content is more appropriate 13 balance between diesel fuel production capabilities and 14 sulfur impacts on engine emission control technologies. We 15 believe there's a need to push engine manufacturers. 16 Lowering the sulfur to an average of not less 17 than 30 ppm is critical to refiners, especially small 18 refiners, to avoid substantial reduction in diesel fuel 19 production. Below the break point of 25 to 35 parts per 20 million sulfur, costs increase dramatically and production 21 declines dramatically. 22 As compared to 15 ppm a sulfur of 30 ppm 23 appears to result in almost no measurable difference in 24 fuel economy or the ability of the technology to meet 25 emission standards. An observation would be if Navistar 146 1 can meet the standards today with 15 parts per million why 2 stifle technology and suggest that no further development 3 is necessary. 4 The sulfur content of 15 ppm will reduce the 5 volumes substantially simply by lowering end point. The 6 base case, that is, will reduce the routine volume of 7 production. Perhaps more importantly, a sulfur content of 8 15 parts per million creates an untenably fragile system 9 for production. There is simply no margin for error. 10 There are minor process variations would create offspec 11 batches that are going to have to be reprocessed. 12 Other members of this panel will be speaking 13 to that issue substantially more. The bottom line is that 14 EPA's proposal will not only reduce the overall diesel 15 production capacities but also create a system so 16 susceptible to upset and batch loss that spot shortages and 17 their resulting price spikes will become common place. 18 There's no question that 15 ppm sulfur diesel 19 fuel can be made. The question is how much of it, how 20 consistently can it be made and at what cost. The 21 requirement for 15 ppm sulfur diesel fuel also establishes 22 an untenably fragile system for engine manufacturers. It 23 seems to me dangerous for engine manufacturers to design a 24 system so sensitive to sulfur that exposures to anything 25 more than 15 parts per million will create problems. This 147 1 is an extraordinarily low level. 2 Let me then turn to the small-refiner 3 perspective, specifically having to do with some of the 4 issues requested that you asked for specific comments. 5 WIRA did participate in your Sabrifa process. 6 Unfortunately, this Sabrifa process did not meet the legal 7 requirements of section 609 because no one during the 8 Sabrifa process, including EPA, focused upon a goal of 15 9 parts per million sulfur. That rulemaking is fatally 10 flawed and subject to challenge. 11 However, during that process there was a 12 breakpoint for J-curve on sulfur reduction that was 13 demonstrated to be at 25 to 35 parts per million. We 14 demonstrated that as to small refiners the low 30 ppm costs 15 increased dramatically and production declines. We do 16 appreciate EPA's recognition at the convening of the 17 Sabrifa panel and your understanding of the peculiar and 18 extraordinary challenges that are facing small and 19 independent refiners. 20 EPA recognizes that it will cost small 21 refiners 50 percent more to achieve the same sulfur 22 reductions. We think actually this estimate is low. The 23 key point is that small refiners need an menu of options to 24 choose from to reduce the negative implications. There is 25 no one solution that the help every small refiners. 148 1 You did request some specific comment on some 2 specific options. Of those three options for which EPA 3 seeks specific comment, WIRA supports the ability to 4 sell 500 ppm segregated onroad diesel fuel. This option is 5 not particularly helpful, but it may be of some limited 6 value to some small retainers and better for West Coast 7 refiners than the other options. 8 We also support a 30 ppm average even if EPA, 9 incorrectly we believe, chooses to pursue a 15 ppm for all 10 other refiners diesel fuel. EPA could also establish a 11 mandatory exchange program for ultra-low diesel fuel. 12 A hardship extension is not helpful because all West Coast 13 refiners either make no gasoline or already make ultra-low 14 sulfur gasoline. The tier-two gasoline standards have no 15 effect on small refiners on the West Coast. 16 A couple of additional final points. EPA 17 needs to prohibit dumping into the offroad market, ala the 18 antidumping provisions of gasoline in the gasoline 19 standards of the early '90s. Finally, we need your help to 20 advocate financial support for small refineries. Small 21 refineries will and already are laying the groundwork for 22 legislation for investment tax credits to cover the capital 23 and increased operating costs associated with these rules 24 and the disproportionate implications of those rules on 25 small refiners. We would ask for your support for those 149 1 financial changes. Thank you. 2 MS. OGE: Thank you. Mr. Tuttle, good 3 afternoon. 4 MR. TUTTLE: Thank you. Good Afternoon. My 5 name is Chad Tuttle of Kern Oil and Refining Company. As a 6 small business refiner, my comments today will focus on the 7 diesel fuel sulfur standards. Please note that these 8 comments are presented from the perspective of a small 9 business excessive, which has made extensive financial and 10 commercial investments to enable it to comply with Federal 11 and California fuel regulations. 12 Kern echos the prior comments of Western 13 Independent Refiners Association and other small business 14 refiners speaking to this matter Kern supports EPA's 15 proposal on heavy-duty diesel engine emission standards. 16 Kern further supports and acknowledges the need for diesel 17 sulfur reduction to accomplish the required engine emission 18 reductions. Kern does not agree with EPA's proposed level 19 of sulfur at 15 parts per million. 20 The diesel sulfur reduction to a near zero 21 level is not practical. As a point of reference I will 22 briefly ilustrate Kern, for example, must consistently 23 process its untreated diesel fraction distilled from crude 24 oil with a beginning sulfur level of 5000 ppm. Please note 25 that the current diesel sulfur limit of 500 ppm alone 150 1 represents greater than a 90-percent reduction. 2 The proposed limit of 15 ppm sulfur represents 3 a reduction of 99.7. Kern believes that accomplishing such 4 a severe diesel sulfur reduction on a consistent industry- 5 wide basis is unworkable. Kern cannot meet a 15 ppm 6 standard with our existing desulfurization equiment 7 installed in 1993 to meet the 500 standard. 8 The 15 ppm standard would require Kern to 9 basically start over. This includes a second larger high- 10 pressure diesel hyddrotreater hydrogen plant expanded 11 sulfur recovery and supporting equipment. This carries a 12 price tag of approximately 35 million and is far out of 13 Kern's financial reach. 14 We also reviewed modifications to our existing 15 hydrotreater and based on our findings, diesel production 16 capacity would be reduced by over half. Such a severe 17 reduction is also unworkable. This production imbalance 18 will force Kern out of business due to an already limited 19 and shrinking offroad diesel market. If Kern suffers a 20 production shortfall, including possible shutdown, 21 California will endure further increased diesel costs in 22 the San Joaquin Valley. California would also lose 23 critical Kern gasoline production in the tightly balanced 24 market as well. 25 Kern proposes a diesel sulfur limit average 151 1 of 30 ppm representing a very difficult but technically 2 feasible reduction of 99.4 percent. As compared to 15, 30 3 ppm diesel sulfur content is a more appropriate balance 4 between diesel fuel production capabilities and sulfur 5 impacts on engine emission control technologies. Refiners 6 have been pushed to the limits as well as engine 7 0manufacturers. We recognize we must continue to push 8 harder. 9 Average diesel sulfur limit of 30 ppm is 10 critical to avoid substantial losses in production. As 11 compared to 15, 30 ppm diesel sulfur content represents an 12 almost no measureable difference in fuel economy or the 13 ability of the technology to meet emission standards. The 14 difference between 30 ppm and 15 is little different from 15 the amount of sulfur that may enter a diesel engine as a 16 result of lube oil. 17 Kern is a small independent refinery in 18 Bakersfield, California. Kern is the only small 19 independent refiner in Central California currently 20 producing significant volumes of onroad diesel, which meets 21 both California and Federal specifications. Kern has spent 22 millions of dollars to upgrade its refinery as a result of 23 the 1993 EPA diesel sulfur regulations. Kern is also the 24 only small refiner producing both federal reformulated 25 gasoline and California cleaner burning gasoline. Kern 152 1 employs 107 people and has supplied petroleum product for 2 65 years. 3 Diesel is Kern's livelihood. It is important 4 to note that Kern markets diesel to both the independent 5 and branded marketing secctors in the San Joaquin Valley, 6 High Desert and Central Coast, and as a small independent 7 refiner in Central California, Kern plays a significant 8 role in leveling the market's economic and supply playing 9 fields, particularly in the Southern San Joaquin Valley. 10 The other only other significant producer 11 in the San Joaquim Valley is the major oil company 12 refinery. At peak season produces over 8,000 barrels per 13 day or 39 percent of the San Joaquin Valley market. Kern 14 is clearly a powerful pro-competitive force. For Kern 15 diesel production is the largest part of our business and a 16 fundamental and necessary component of producing onroad 17 diesel has included the largest single refinery investment 18 and modification in our companies 65-year history. This, 19 of course, was EPA's diesel sulfur reduction effective in 20 late 1993 and concurrently california low aromatic diesel 21 regulations. 22 Kern has spent the last four months focusing 23 on how to feasibly achieve comliance with the newly 24 proposed EPA diesel sulfur regulations. This work has 25 included researching the available technology and reviewing 153 1 potential cruid oil input changes. A diesel sulfur limit 2 of 15 ppm will substantially and negatively impact Kern up 3 to and including possible shutdown. 4 We have reviewed diesel sulfur reduction 5 scenarios from 50 to 15 ppm. Our work shows that an 6 average limit of 30 ppm is workable, with modest production 7 losses. 15 is not. 8 Kern strongly agrees with the EPA's findings 9 and the advanced notice of produced rulemaking published 10 in the May 13, 1999 federal register which states: 11 "Desulfurization of diesel fuel to very low levels is 12 expected to involve substantial investments and added 13 operating expenses by petroleum refiners." 14 Small business refineries like Kern will face 15 more severe solution scenarios compared to major oil 16 companies. Small refiners operate under different less 17 flexible processes than do larger refiners. It is 18 important to note that small refiners also face additional 19 restraints to secure financing from major projects. This 20 is cumulative when compared to the other issues of 21 planning, engineering, permitting, purchases of equipment, 22 construction and start-up. 23 Kern requests that EPA formally support 24 economic incentive for small business refiners including 25 but not necessarily limited to investment tax credits, 154 1 excise tax relief, accelerated depreciation or expensive 2 qualified environmental expenditures and acid-rain credits 3 to help cover capital and increased operating expenses. 4 In closing, Kern concurs with EPS'a proposed 5 heavy-duty diesel engine emission standards. Kern supports 6 the need to reduce sulfur in diesel. Kern strongly opposes 7 15 ppm diesel sulfur limit. Kern supports a 30 ppm average 8 diesel sulfur limit. Keep in mind for us there are 9 enormous differences between a 99.7 percent reduction. 10 Kern requests that EPA formally and publically 11 advocate and endorse small business economic assistance. 12 Possibly through excise tax credits, investment tax 13 initiatives and/or other options so that small business 14 refiners can absorb greater than 50 percent cost of 15 compliance that we have estimated we will incur. 16 California's economy is dependent on the 17 element of competition that Kern and other small refineries 18 provide. Thank you. 19 MS. OGE: Thank you. Mr. Duane Bordvick. 20 Good afternoon. 21 MR. BORDVICK: I am Duane Bordvick. I am 22 Senior Vice President for Safety Health and Environment for 23 Tosco Corporation. Thank you for this opportunity here 24 today. Tosco is not a small refiner. Maybe once we were, 25 but now we are not. We are a large refiner. We are not a 155 1 major oil company. Not an integrated oil company. We have 2 no production, but as a refiner I believe we now are third 3 in the nation for refining capacity and one of the major 4 suppliers of diesel fuel in the United States. 5 Tosco supports EPA's basic proposal of one 6 standard 15 parts per million. One time 2006 for all 7 refiners for all the country. As a major supplier of 8 gasoline and diesel fuel to the public Tosco believes that 9 we must continually improve these product to make them 10 environmentally acceptable. For this reason, Tosco has 11 supported a number of similar measures, such as rapid phase 12 oou of EMTV, lowering the gasoline sulfur 30 parts per 13 million, and now this ultra-low sulfur diesel proposal. 14 Making clean fuels we believe is our mission. 15 We believe at the important. We are in this business. We 16 want to stay in this business. We want to be able to have 17 a fuel that competes with any other clean fuel. For that 18 reason and many others we believe it is the right thing to 19 do. 20 The standard will indeed, as you heard today, 21 pose some significant costs on the refining industry, and I 22 can assure you that includes Tosco. I have heard some 23 speculate that Tosco is taking this position because we are 24 in some special circumstance or we have an ability to meet 25 the standard today without spending large sums of money. 156 1 This isn't true. It is not so. 2 We have looked at the cost of pleading the new 3 standard. It is in the range of what EPA has predicted. 4 We don't believe we have any special circumstances. We do 5 have some California refineries. About 25 percent of our 6 capacity is in California. In California as well we have 7 to make significant investments. 8 For the purpose of our business, making clean 9 products, for the same purposes that you have proposed for 10 the health of our country, we are pleased to strongly 11 support your proposal. I would like to add some comments 12 on some of the other measures that you have asked for 13 comments on. 14 The alternative program options is one of 15 them. We do have some serious concerns about that. I 16 believe you have raised many of those concerns in the staff 17 report and we think you correctly identified many, if not 18 all of those concerns, that we believe it is not 19 appropriate or will not do anyone any good, necessarily, to 20 have a phase-in approach. 21 In our own company we have asked our marketing 22 people, asked distribution people, commercial people, 23 refiner people is this good, will this help, do you want 24 this. No. Across the board the answer was no. In some 25 you can see some benefit. To others we for a short time. 157 1 In the long term we don't believe it will provide any 2 benefit, and it carries a lot of risks which you identifid. 3 Misfueling, et cetera. 4 One of the big risks may be the impact that it 5 has possibly on supply. I think our industry works best 6 when you have some certainty. When you have to make it you 7 know what to do. Our industry should be pretty proud. We 8 have done a lot. We have met the challenges and I think we 9 can meet this challenge. When you put in some alternatives 10 and put in some phase-ins, there is now uncertainty of who 11 is going to be making the fuel win, I think that will 12 increase the risk of supply. 13 And as API mentioned this morning, supply is a 14 serious concern. We are concerned about that as well. I 15 think it has to be seriously considered, and we believe, I 16 think we are optimistic, certainly our company and our 17 industry, that we will, given the six and a half years that 18 we have to meet this, we will do it. 19 I will also comment on another provision, the 20 small refiner. You have heard some already. Generally we 21 don't support any special provisions for our industry. 22 There may be special cases. I think my only comment there 23 would be to be very careful to have any provision be as 24 narrow and specific as possible so you don't fall into some 25 of the problems that might be associated with the phase-in 158 1 and certainly with supply inequities. 2 I will say that we can go along with certain 3 very carefully, very narrow provisions to help certain 4 segments of our industry, but be very careful. In 5 conclusion, again, I want to reiterate our strong support 6 for your proposal, 15 parts per million. One time, 2006. 7 The dual fuel, the phase-in we think is very dangerous and 8 unworkable. Go with your straight-forward proposal. We 9 are ready to do it with you. It will mean that, we hope, 10 diesel fuel will be around for a very, very long time and 11 protect the length of our folks, and frankly we think it is 12 the right thing to do. Thank you. 13 MS. OGE: Thank you for the support. Mr. Al 14 Cabodi, good afternoon. 15 MR. CABODI: My name is Al Cabodi. I am vice 16 president of manufacturing for U.S. Oil and Refining 17 Company. We are a small independent 45,000 barrel a day 18 refinery in Tacoma, Washington, which is about 30 miles 19 south of Seattle. We are not a Tosco. We don't have a 20 million barrels of capacity. 21 However, small refiners like U. S. Oil are 22 important to the national economy and security. U.S. Oil 23 supplies 45 percent of the asphalt products in Western 24 Washington. We supply approximately 100 percent of the 25 military JPA to McCord Air Force Base, which is one of the 159 1 premier Air Force Bases in the United States. We supply 2 relatively small amount of diesel, but that's still a 3 couple 100,000 gallons a day of diesel on the onboard 4 market primarily. 5 We are a family owned business. We care for 6 the community and we care for the people around us and we 7 want to be a good environmental neighbor. However, we want 8 to stay in business. USO participated in the Sabrifa 9 panel, one of 22 small refiners producing diesel in the 10 United States. We do support the proposal on engine 11 emissions standards. We do support EPA's dramatic 12 reduction in sulfur, however not to the 15 ppm level. 13 As we see it, an onroad diesel sulfur content 14 of 15 ppm maximum creates a very fragile system for 15 productions, and it is going to result in some problems. I 16 am going to go into a little more detail on these problems 17 as I see it. You will have unnecessary product cost 18 increases. To go from a 30 average to a 15 will be a 19 significant operating and capital investment cost. We 20 think it will be at least five cents a gallon higher than 21 the 30 ppm average. 22 You will have lower fuel economy, reduced 23 diesel volumes and reduced jet fuel volumes. Let me 24 elaborate on these points because some of those points have 25 not been made before or they have been in very cursory 160 1 remarks. 2 First off you have very little margin in error 3 when you are producing ultra-low sulfur diesel. Minor 4 process variations, changes in raw materials will create 5 offspec batches and most people won't have the capabilities 6 to reprocess those. If you have a problem in your 7 operation and you have a tank that is off specification, 8 you will have a tough time just continuing your operation 9 to continue on making an ultra-low sulfur product. 10 So many of these will probably be dumbed into 11 an offroad diesel market or used as cutters. That will 12 pull volume out of the offroad diesel fuel. Refinery 13 diesel production are more limited in gasoline. It results 14 in a lower flexibility to control and blend sulfur to such 15 low levels. Light cycles, sulfur distillates will be 16 eliminated by many people from the onroad sulfur fuel. 17 This is a significant effect. 18 These sulfur components are extremely 19 difficult to get out and that will require even a higher 20 investment than the normal hydrotreating investment. The 21 choice is going to be do I put this investment in on the 22 front end thinking I am going to get some economic benefit 23 for doing it. I am not sure people are going to do that 24 because what is going to happen they will say there is go 25 to have to be a price increase to support this. I will see 161 1 a little later. You are talking about a significant 2 percentage of the diesel fuel. 3 The crudes that presently run sometimes 4 especially for products like asphalt, specialty products 5 are extremely high sulfur, very difficult crudes to handle. 6 We presently take the distillates from these and turn them 7 down to less than 500 ppm and put them onto the onroad 8 diesel fuel. That is not going to happen if this action 9 goes to 15 ppm. 10 The reason is you are dealing with unusual 11 crudes. You are dealing with crudes that are Canadian 12 crudes that are pumped out of the ground using huff and 13 puff methods. They get down there and burn the crudes, 14 make them come out of the ground and cut them back and put 15 them into a marketplace, and you have variations as of 16 sulfur compounds that you can't count on getting out. We 17 couldn't dare take the chance to run these crudes anymore. 18 The heavier portion of the diesel fuel, which has sulfur 19 compounds that are more difficult to get out. 20 One of the ways you can go ahead and go down 21 to the 15 parts per million is cut out of heavy portion of 22 diesel so it is no longer in the fuel. It is no longer an 23 onroad market. You cut a chunk of that out. You can do an 24 easier job to the 15 ppm. That's volume. The other thing 25 is the fuel efficiency is primarily from the heavier 162 1 components in diesel. Those are based on pounds per 2 gallon. Which have more pounds and more PBDU. 3 If you start cutting those out to eliminate 4 the sulfur compound your miles per gallon go down, and that 5 is totally contrary to what the truckers are thinking. 6 They keep thinking this is great to get the sulfur down, 7 the emission controls work a little easier and the 8 efficiencies are better and you will get more efficiency 9 out of the engine. If you cut out the heavy components you 10 will have less pounds per gallon and you will get lower 11 miles per gallon. 12 One more point, if you start cutting -- let's 13 go conversely to cutting out the back end. You start 14 taking the back end of jet fuel, which is a lighter 15 product, which has easier sulfur compound to remove, put it 16 into the diesel fuel, you now have a little bit more onraod 17 diesel that you have made up some volume, but you have 18 pulled it out of the jet market. The jet market is a tight 19 market many times. That can cause some problems there. 20 I believe that for the aforementioned reasons 21 that if you go to a 15 ppm max ultra-low diesel supplies 22 will be extremely tight and any incidents in productions at 23 refineries will result in supreme reductions and price 24 spikes. Supply and demand economics will be felt. 25 As I mentioned for the above reasons, we 163 1 support a 30 ppm average. That's a 94 percent reduction 2 from today's standards. I think we need to put a little 3 bit of pressure on the engine control manufacturers. Why 4 should the public pay for an easy-out. If they can do 15 5 now, why don't we let them put a little investment in and 6 save the public money instead of the public having to spend 7 a much lower sulfur than they have to to get the same 8 emission standards. I think they can develop in the next 9 few years better controls. 10 We appreciate the EPA's recognition of the 11 challenges facing the small refiners. To remain a viable 12 operation we have to have a menu of options. We support 13 the authority to sell 500 ppms segregated onroad diesel. 14 That's not saying you need a nationwide two-tiered system. 15 That won't happen. For the few small refiners that may be 16 able to use this, something where they may be able to get 17 some local distributors to keep the older vehicles running 18 500 ppm and take a portion of the fuel and relieve some of 19 their strain. That may be workable. Leave the option in 20 there. It probably means nothing to U. S. Oil but it might 21 help some other people. 22 The hardship extension doesn't do anything for 23 U. S. Oil. I will list a few other options I would like 24 you to consider. We propose a mandatory diesel exchange 25 program if you continue to go with a 15 ppm max. It would 164 1 work something like that this. Small refiners would have 2 the option to produce and sell 500 ppm sulfur diesel into 3 offroad or marine markets either directly or in exchange 4 with majors. 5 EPA would then make available ultra-low sulfur 6 onroad diesel barrel for barrel. We pay a premium for that 7 diesel equal to the differential between the operating 8 costs of the low sulfur and the ultra-low sulfur diesel. 9 This is a win-win situation because you are going to have a 10 contribution of a 500 ppm or less low sulfur diesel into 11 the offroad market early and some small refiners may have a 12 capability and put 100 percent into that offroad fuel which 13 will lower emissions, but we need to the right to get 14 ultra-low sulfur diesel to be able to supply our customers, 15 otherwise we will be out of business. 16 You must prevent dumping of high sulfur diesel 17 components into the offroad diesel market because that will 18 deteriorate the environment and at the same time create an 19 offroad price collapse. Finally, the EPA needs to help 20 small refiners in endorsing and obtaining financial 21 support. This was mentioned, but we really need help on 22 this. We can look at income or excise tax credits, 23 accelerated depreciation, loan guarantees, and that may 24 help us to supplying the ultra-low diesel problem. Thank 25 you for the opportunity to present my comments. 165 1 MS. OGE: Thank you, Mr. Cabodi. I would like 2 to call for Mr. Gary Helbertson. Good afternoon. 3 MR. HERBERTSON: Good afternoon. I represent 4 the Institute for Global Solutions, the North American 5 Coalition for Religion and Ecology and the Earth Day, Earth 6 Week Global Green Ribbon Pledge Campaign. I am honored to 7 have the opportunity to speak at this crucial life or death 8 hearing on diesel fuel emission standards. 9 I speak in the context of being one of the 10 founding staff members of the United Nations Environment 11 Program assisting in the planning and coordination of 12 citizen participation in the first UN World Conference on 13 the environment health in Stockholm in '72, and organizing 14 the owning nongovernmental section of the UN Earth Submit 15 in Rio in '92. 16 "Where there is no vision the people perish." 17 And "You shall know the truth and the truth shall make you 18 free." Are two prophetic statements which have likely 19 significant relevance for this life or death hearing on 20 diesel fuel emission standards. It is absolutely wrong, 21 immoral and intolerable that in the U.S.A. alone every year 22 smog and particulate matter account for 15,000 premature 23 deaths, one million respiratory problems, 400,000 asthma 24 attacks, and thousands and thousands of cases of aggravated 25 asthma. Air company pollution near ground level and acid 166 1 precipitation are already causing widespread injury to 2 humans, forests and crops. We must bring environmentally 3 damaging activities under control to restore and protect 4 the integrity of the earth systems we depend on. 5 A great change in our stewardship of our earth 6 and the life on it is required if vast human misery is to 7 be avoided and our global home on this planet is not to be 8 irretrievably mutilated. Clearly have warned thousands of 9 the most distinguished scientists on your planet, including 10 104 Nobel Prize Laureates. The evidence is in. Diesel 11 fuels are a life or death issue which we must deal with an 12 on a emergency basis within our nation and for the future 13 of all life residing on your common planet earth. 14 To end totally unnecessary deaths we must take 15 action to make drastic reductions from diesel fuel killing 16 pollution from heavy-duty buses and trucks. Diesel fuels 17 are an eco-justice issue. Poor communities are polluted. 18 I strongly urge you to take leadership for 19 life and against death by reducing diesel sulfur levels to 20 no more than 15 ppm nationwide for both on- and offroad 21 diesels nationwide by 2006. Require all big trucks and 22 buses to be cleaned up by at least 90 percent by 2007. 23 Ensure that all heavy-duty diesel fuel vehicles meet strict 24 emission standards when they are moving over our 25 environmentally damaged planet earth. Not just when they 167 1 have their engine tests. 2 Leadership for life and against death also 3 requires the immediate creation and use of diesel fuel 4 alternatives, such as electric and fuel cell vehicles. 5 Diesel fuel is a life or death mortal crises. It was Dante 6 who said "The hottest fires in hell burn most brightly for 7 those who remain neutral in a moral crisis." Only those 8 who commit themselves to solutions, the diesel fuel 9 destruction of life on earth, will end this unnecessary 10 hell on earth process. 11 Please fulfill your life or death 12 responsibility to end our diesel fuel crisis in accord with 13 the earth charter pledge. We, the people of the earth, 14 join together in a global partnership pledge to respect 15 earth and all life, care for the community of life and all 16 its diversity. Strive to build free, just, participatory, 17 sustainable and peaceful societies. Secure Earth's 18 abundance and beauty for present and all future 19 generations. Good luck for the future of life on earth. 20 MS. OGE: Thank you. Mr. Steve Farkas. 21 MR. FARKAS: Good afternoon. I am Steve 22 Farkas. I am the general counsel at Paramount Petroleum 23 Corporation. I wanted to echo the comments made by the 24 other small refiners sitting at the table, but also wanted 25 to add a little bit of insight into the importance of 168 1 independent small refiners. The word independent means 2 something, especially in this day in age of consolidate oil 3 allogapolies. 4 We in the last ten years have had many battles 5 with our large brethren exhibited by them that was strange 6 to understand unless there was some ulterior motive based 7 on potentially eliminating competition and profiting 8 thereby. I am not alleging that. I am kind of guessing 9 what was maybe at the root of it. 10 We have spent ten years meeting with 11 California Resources Board who accepts the importance of an 12 independent refiner. We have met with California Energy 13 Commission. Bill Alkper told me I wish I could figure out 14 a way to get more competitors in this state to keep oil, 15 gas prices under control. Even the AQD, in the very last, 16 in their recent 431.2 proposal had a small refiner 17 exemption, following your lead, but that was the first time 18 we had ever seen anything like that before. 19 It is pretty important to understand the place 20 and role that small independent refiners play. We have the 21 largest asphalt producer in the Western United States. 22 When a car of formulated gasoline was proposed and enacted 23 we stopped making gasoline, eliminating 20,000, 30,000 24 brrels a day out of the market. I don't think prices go 25 down when that happens. I only took the first level course 169 1 of economics. 2 When we were competing with the Federal Trade 3 Commission -- this is kind of an interesting off the 4 subject but kind of important to note -- trying to express 5 to them the importance of small refiners, discussing the 6 ARCO/BP merger, we made the point that a small refiner like 7 Paramount actually set the crude oil price for Alaskan 8 crude. 9 They did their investigation and found out 10 that there was some truth to that because the market dried 11 up in that major supply themselves and they supply others 12 on the long-term contracts. And when you look at what is 13 the open market it is rather sparse. When a small refiner 14 like Paramount comes in and bids on the price of ANS crude 15 it ends up setting the market price which impacts the price 16 of gasoline in the U.S. ARCO helped themselves and the 17 merger was approved. 18 I want to point out that the AQD itself I 19 think understands the slim balance they are trying to 20 propose their 431.2 and in a meeting with them last week 21 they suggested to me that they think there's adequate 22 supply, at least the L. A. area, of diesel because they 23 believe production is hundred -- they believe that demand 24 at the time 2003, 2004, will be 120,000 barrels a day and 25 that supplies 116,000 barrels a day. 170 1 Paramount produces 8,000 barrels a day, and 2 at 15 ppm we won't be able to do that. That leads to the 3 presumption that there will be a shortage, at least if the 4 AKE rule is enacted prior to the EPA rule in Los Angeles. 5 Again, just like what was said by representative from Kern, 6 it is in excess of $30 million to do that. 7 The other thing I think I part a little from 8 the other people, although cognisance of the need for small 9 refiner exemption, even in the guise of 500 ppm segregated 10 system, is good, the end result is it won't have much 11 impact because in Los Angeles and in California those other 12 systems of distribution are controlled by the majors. I 13 don't know if they will be doing us much much of a favor. 14 I guess that's the point on that. 15 What we really do need is a 30 ppm average. 16 It allows us based on the engineering to make diesel, a 17 small refiner diesel, low sulfur diesel, at a cost that is 18 one that we can withstand. Probably need a little extra 19 time to do it. But I just wanted to make the point of the 20 need and the importance of the independent refiner in the 21 State of California. That's all. 22 MS. OGE: Thank you. Ms. Clara Rosenthal. 23 Welcome. 24 MS. ROSENTHAL: Thank you so much. My name is 25 Clara Rosenthal and I am the Vice President, Director of 171 1 Health Education for the Los Angeles Tenth District PTA. 2 The Los Angeles Tenth District runs through East L.A., 3 North L. A., South L.A. from San Pedro at the way north to 4 the Pacific Palisades. We are also part of the California 5 State PTA and the National PTA. 6 I want to thank you for giving me this 7 opportunity to speak on behalf of the Los Angeles Tenth 8 District PTA and particularly to thank the EPA for their 9 years of work in prevention. I was very happy to see the 10 students from Belmont here. The first thing they did say, 11 and I was going to say that is "Our children are our 12 future." 13 What are we mouthing here. Are we mouthing 14 words that are meaningless just to give lip service. You 15 heard from the children themselves that we have many more 16 cases of respiratory illness, children are not being able 17 to attend school, and once they miss out or lose out, it 18 is very hard for them to continue their education, so, 19 therefore, we have a lot of dropouts. 20 I want for tell you that Los Angeles Tenth 21 District as well as the entire PTA, the National PTA with 22 over 7 million members does a lot more than most people 23 think PTA is all about. Cookies, serving cake, no. We 24 have a very strong legislative platform that we have had 25 since the beginning for 100 years plus two. Two years ago 172 1 we celebrated the one hundredth anniversary of the national 2 and local and state PTAs. 3 We have people that work in Sacramento -- when 4 I say people, these are members of our PTAs that work in 5 Sacramento that work with all legislative issues affecting 6 children. I want to give you some little insight as to 7 what we call a resolution in the state convention that 8 occurs once a year we have resolutions from the local 9 schools. They have everything to do with the health of the 10 children, the well-being of children and youth, and 11 encouraging education on subjects of major importance to 12 society. 13 We recommend maximum acceptable safe levels of 14 01 parts per million oxidant in the air and exceeded in all 15 urban areas of California wherein children's school 16 activities expose them to the adverse affects of polluted 17 air and vigorous coordinated and sustained efforts should 18 be made to remove the possibility of long-term adverse 19 effects on the health of children and the community. 20 Therefore, be it that the state PTA convention 21 reaffirm the statement on environmental pollution adopted 22 by the State PTA Board of Managers in September, and be it 23 further that all communities whose air quality does not 24 meet prescribed standards, especially oxidant level, be 25 urged to enact uniform alert levels at which school 173 1 districts undertake measures to protect students from 2 adverse effects, and be it further that each school 3 district is urged to establish a policy of curtailing 4 physical education and related activity when the alert 5 level is attained. Which means that the kids have to go 6 in, it interrupts their schooling. You heard all the 7 figures of the escalating respiratory ailments and 8 illnesses that we have. 9 I remember four years ago on our Board of 10 Directors for the Tenth District PTA where there were six 11 women that were battling cancer. These are women in the 12 prime of life, mothers. Three of them have passed away. 13 We cannot continue this kind of to me hypocracy. Either we 14 value children's lives or we don't. 15 I know time is short here. I just want to 16 read you one more issue from our environmental projects. 17 Clean air, 1997. It was a resolution. This was our last 18 resolution. We up it every year. We recognize that air 19 pollutants, such as carbon dioxide, carbon monoxide, lead, 20 nitrogen oxides, ozone particulates, sulfur flouride, 21 sulfur dioxide have detrimental effects on children's 22 health. 23 We call for constituent organizations to 24 support environmental awareness programs and right to know 25 legislation and regulations addressing air qualities. And 174 1 from what I heard today, we have so many groups that are 2 like us, that once to help children live and be concerned 3 citizen that I really am happy in one way, but I hope that 4 we will be stronger forces together, banding together, to 5 really know that our children are our future. Thank you. 6 MS. OGE: Thank you, Mr. Dan Jacobson. Good 7 afternoon. 8 MR. JACOBSON: Good afternoon and thank you 9 very much for allowing me to testify here today. My name 10 is Dan Jacobson. I am senior staff person for California 11 Research Group Calper. They are in strong support of the 12 standards that you are proposing for a number of reasons. 13 I think you guys have done a great job today just being 14 able to listen to all the testimony you have heard. Today 15 you have heard from a lot of the religious leaders and 16 community leaders, teachers, students, health experts. 17 Their will be a number of additional speakers that you will 18 hear from. 19 It is not unusual that when people come to 20 California that one of the main concerns they hear about is 21 clean air. It almost seems apropos that today is a smog 22 alert day that we are talking about this where we are 23 actually saying that the air isn't good to breathe today 24 and we need to be doing something about it and we applaud 25 your efforts to be trying to do everything you can on this 175 1 issue. 2 In California the air is still unhealthy to 3 breath on a number of days. That's why we need the EPA to 4 stands strong on this rule. The big trucks and buses are 5 among the biggest polluters. In the past they cheated on 6 tests that have allowed them to continue to emit smog- 7 forming pollution into our atmosphere. In order to protect 8 the public health, we have to require drastic reductions in 9 pollution from these large trucks and buses. However, 10 because high sulfur fuel will hurt these new diesel cleanup 11 technologies, we must be sure that all diesel fuel is 12 cleaned up by the time that these new technologies are 13 ready. 14 Therefore, in order to insure that all the 15 cleaner trucks will have access to these clean fuels at 16 Calper we are urging the EPA to require that the diesel 17 sulfur levels for onroad and offroad vehicles with a cap of 18 more than 15 ppms. Cleaning up these things are going to 19 be incredibly important. You have heard from health 20 experts and scientists and business leaders from across the 21 state who are saying we are in a predicament here. We need 22 your help. 23 They are not only asking that diesel be 24 cleaned up, but across the state they are asking if a 25 number of different steps be taken. At the federal level 176 1 this is a strong system step we are asking for. The state 2 level we are asking to continue the zero emission program 3 to start in by 2003. There's a lot that people here in 4 California need to do to clean up their area. This is an 5 important first step to do it. We are urging you to please 6 take it step. Thank you very much for that time. 7 MS. OGE: Thank you very much. I would like 8 to thank all of you. The interested representatives, the 9 concerned citizens, the environmental and public health 10 groups. Thank you for taking the time to share with us 11 your testimony. We will take your comments into 12 consideration as we are moving forward in finalizing this. 13 We are making great time. We are a half hour late. I will 14 call the 2:45 panel. 15 Mr. Steve Campbell, David Bartlett, Angie 16 Farleigh, Professor Williams Hines and Mr. John Dewitt. 17 Please print your name on the card in front of you. 18 MS. OGE: Mr. Campbell, good afternoon and 19 welcome. 20 * MR. CAMPBELL: My name is Todd Campbell, 21 policy director for the coalition for clean air. I 22 apologize that you have to eat lunch while I speak so 23 late, but that seems like an everyday lifestyle for an 24 environmentalist like myself. The Coalition for Clean Air 25 on behalf of your members throughout the State and for 177 1 breathers who breathe up hill though air daily applaud the 2 United States for our EPA in bringing forth what should be 3 considered and what this organizations believes one of the 4 most important national roots to be heard this day. 5 The federal government has the power to 6 relieve our nation's ailments that place the air we breathe 7 and diesel exhaust should be viewed very high on the EPA's 8 pollution list because diesel significantly impacting our 9 communities, our neighborhoods or our children and 10 grandparents and friends and even ourselves. It's health 11 invocations are numerous, significant and serious. 12 The state of health of California is in 13 serious crisis with regards to diesel exhaust pollution. 14 Two percent of California's onroad vehicles are diesels, 15 yet they constitute over 30 percent of the smog-forming 16 emissions of NOx and 70 percent of the particulates from 17 California mobile source inventories. 18 Over 97 percent of the particles that come out 19 of diesel exhaust are ultrafine particles which have been 20 linked to many respiratory diseases like asthma. In 21 California, an estimated 500,000 children are suffering 22 from asthma alone and this state leads the nation with over 23 2 million people diagnosed with asthma and an increased 24 prevelance rate of 75 percent in the last 15 years. 25 Asthma, unfortunately, is not the only problem 178 1 associated with exhaust. Join the ranks of the National 2 Institute of Occupational Safety and Health among other 3 notorious health agencies. The California Environmental 4 Protection Agency's diesel exhausts is a toxic component. 5 That is diesel particulates in 1998, August of 1998, and 6 prior the listing of 40 other compounds, listing on and on 7 known to the state to either cause cancer or reproductive 8 harm. 9 In the South Coast Basin alone over 70 percent 10 of the air pollution is directly attributable to diesel 11 soot, according to the local air quality management 12 district. And as you heard earlier, STAPPA/ALAPCO 13 estimates that over 125,000 cancer cases will be directly 14 linked to the current diesel exahust levels nationwide, but 15 in the Los Angeles metropolitan area alone, 16,250 access 16 cases are predicted. That's 13 percent of this estimate 17 nationwide. 18 Why is that? For one, we have a lot of the 19 nation's trade by having two of the largest and busiest 20 ports, Long Beach and Los Angeles. They require both 21 diesel trains and trucks to haul thousands of freight tons 22 to destinations as far as the State of Maine. We are also 23 a burgeoning population. The Southern California 24 Association of Governments estimates that this region will 25 reach a populus of 20 million by 2020. That's like adding 179 1 two cities of the size of Chicago on top of what already 2 exists. 3 It is no surprise that our communities of the 4 Alameda Corridor and other well diesel-traveled routes are 5 at higher risks than most communities. Unfortunately, 6 there are more communities that are at greater risk from 7 diesel throught this great state and beyond. The cities of 8 RIchmond, Oakland, Stockton, San Leandro, Sacramento, and 9 even San Diego to name just a few, including the Central 10 Valley suffer from crank diesel exhaust levels. 11 The only way we are going to address the small 12 owner/operator question is getting to those operators that 13 actually buy their vehicles and are not large fleets in 14 ports, harbors and airports, is through tighter stands 15 for the fuels we use and engines we design. But more 16 importantly, we owe it to these communities that bear the 17 brunt of our Nation's trade and provide the level of 18 prosperity that we all enjoy, to return the air quality 19 that breathe to a safe and healthy level. 20 Everyone is entitled to a bill of rights for 21 clean air and these people are being cheated everyday. 22 What we need is a fuel that will move us forward and that 23 is ultra-low sulfur diesel. Low sulfur at 15 parts per 24 million is a tremendous first step from 500 ppm, but 25 California is already infusing this fuel into the 180 1 california refinery system today. 2 15 parts per million sulfur diesel is being 3 made available through countless commitments and 4 testimonies made by BP, Amoco, Texaco and Chevron 5 representatives throughout the state. In fact, the 6 technology is here in 2000 to achieve levels even lower 7 than 15 parts per million as BP, Amoco, and then ARCO 8 announced its first sulfur fuel that sat around ten parts 9 per million over a year ago. 10 Furthermore, the Europeans are way ahead of us 11 on ultra-low sulfur diesel by producing low sulfur diesel 12 at the level of five to 10 parts per million. We need to 13 get back on track fast and furious. My question for this 14 regulatory agency is if we have the technology to meet 15 15 parts per million, why wait six years to implement this 16 action. 17 Furthermore, why not give engine manufacturers 18 the fuel that will optimize engine performance by setting 19 the target at 5 parts per million. Under the current rule 20 this gives industry six years to figure out the way to get 21 sulfur levels down an additional 10 parts per million. 22 If the problem is residual sulfur in the pipelines, provide 23 a phase-in in the sulfur level starting at 15 parts per 24 million in 2006, 10 ppm in 2007 and 5 ppm in 2008. However 25 you choose to do it, get these sulfur levels down. Like 181 1 lead in gasoline, sulfur is a deterrent for diesel to reach 2 cleaner levels. 3 Bottom line, either we are serious about 4 public health or we are not. The oil companies first 5 quarter, furthermore, their profits of $11 billion plus 6 could pay for this whole rule alone. Fewer refiners, as it 7 was mentioned earlier, means bigger and wealthier refiners. 8 If this industry wants to rid itself from boutique fuels, 9 it should clean up its act. 10 The other thing that we need is cleaner 11 engines sooner, not later. We need cleaner engines 12 yesterday. What you are talking about is seven years 13 before we begin to even realize the change in current 14 conditions, and this is not even 100 percent allocation. 15 The rule proposes incremental market phase-in 16 of 25 percent that in reality drags out until the end of 17 this decade. That's too long, too late. Our lungs can't 18 wait ten years. We need clean engines today. Our 19 communities cannot continue to carry the pollution subsidy 20 allowed to this industry any longer. At a very minumum, 21 you should require or need to require 100 percent 22 implemention of the clean engines proposed by 2007 or you 23 need to start looking at cleaner alternative routes like 24 the South Coast has opted to do to address its diesel 25 problems. 182 1 This industry should be put on notice, the 2 diesel industry that is, to either clean up its act or make 3 way for cleaner technologies like fuel cells. We just 4 can't wait any longer for what is proposed on the books 5 before us. We also would like to agree with the air 6 resources board in strengthening the formaldehyde standard 7 to 2.01 from the .06 proposal. We feel that toxics at 8 least in the Southern California are significant area of 9 threat to our human health, and we encourage that you 10 tighten this standard. 11 In addition to better in-use vehicle emission 12 tests and toxicity protocols are extremely necessary. I 13 cannot emphasize enough the need for better testing for 14 in-use vehicle emissions or accurate evaluations of 15 toxicity from engine exhausts. We need to better 16 understand when our vents from mobile sources on and off 17 the road really are. We also need to understand what is 18 toxic and by how much. 19 Although I do feel some relief by this Agency 20 in setting formaldehyde standards and soot reductions that 21 some level of toxicity will be reduced in diesel exhaust, 22 no one to date can authoritatively state the reduction of 23 diesel exhaust soot is equal to .01 gram particulate matter 24 standard will reduce the standard of toxicity. 25 We need EPA and other health base agencies to 183 1 tackle this important problem and give us a way to tackle 2 the toxicity associated with diesel natural gas in whatever 3 field we might choose to transfer people or goods in the 4 future. Interim steps I am going to talk about briefly. 5 I think we should extend low sulfur fuel by 15 6 parts per million available today to the entire country no 7 later than 2004 in allowing local districts throughout the 8 nation, especially those in Houston, to apply particulate 9 traps if they are proven to you be workable. We also 10 strongly support the Blue Skys program. We need to 11 recognize that cleaner technologies drive diesel and other 12 dirty air fuels to zero. 13 Electric bus and also we should look and zero 14 emission technologies that are here today like electricity 15 and fuel cell. I have many, many things to share with you, 16 but I would beg you to consider an optional zero emissions 17 standard. When you are talking about the Blue Sky 18 standards, think of an optional zero emission standards. 19 Finally, apply the sulfur level fuels to offroad vehicles. 20 They need it. It is an inventory that we are overlooking 21 significantly. Thank you. 22 MR. OGE: Thank you, Mr. Campbell. 23 Ms. Farleigh, good afternoon. Mr. Campbell and all of you, 24 if you have written testimony, we would be glad to put that 25 into the record. 184 1 MS. FARLEIGH: Thank you for giving me 2 the opportunity to comment today on a rule that has 3 important and far-reaching implications, our Nations' air 4 quality. My name is Angie Farleigh. I work with U.S. 5 PIRG, which is the national lobby office for Cal PIRG. 6 California Public Interest Research Group. 7 There is a daily reality for Americans living 8 in urban areas to experience thick black clouds of toxic 9 diesel pollution and suffer the short-term discomfort and 10 often the long-term health effects that are a direct result 11 from breathing this exhaust. Our canvassers consistly hear 12 this story from the millions of Americans they talk to at 13 their doors each year. And as a former director of Cal 14 PIRG's office, I know that this pollution effects not only 15 children and elderly, but healthy young adults who spend 16 time outdoors. 17 We actually had several canvassers here 18 earlier this morning but had to leave before they could 19 testify. So I would like to deliver written comments. 20 They wrote these before they left. 21 From Vanessa Lynn, Ryan Bjornstad, Yuri 22 Patamura and Sabrina Para Garcia, which I will give to you 23 after my testimony. It is obviously common sense that 24 cutting the pollution from heavy-duty vehicle will result 25 in enormous public health benefits and will vastly improve 185 1 the quality of life in our cities and suburbs. Common 2 sense in the case of diesel pollution is confirmed time and 3 time again by the health studies showing that exposure to 4 diesel pollution can lead to a range of symptoms from 5 asthma attacks to premature death and lung cancer. 6 Based on over 30 epidemiological studies we 7 know that exposure to diesel exhaust can increase the risk 8 of lung cancer by as much 89 percent. It is to prevent 9 these and other health impacts that U.S. PIRG strongly 10 supports the proposed standards to reduce heavy-duty bus 11 and truck pollution. Three key pieces form the cornerstone 12 of the proposed standards. 13 First of all 15 parts per million cap on 14 diesel fuel by 2006. The second is the .01 grams per 15 brake-horse power-hour particulate standard effective in 16 2007. And finally the standards for NOx and hydrocarbons. 17 I would like to comment on a few specific details related 18 to these provisions. 19 First of all, clean diesel fuel is essential. 20 U.S. PIRG supports the EPS proposal to cap diesel fuel 21 sulfur levels at 15 parts per million effective in 2006. 22 It would be an expensive exercise in futility to spend the 23 next 10 years phasing in advanced afterburner pollution 24 controls for heavy-duty vehicles only to allow these 25 controls to be poisoned and rendered ineffective by the 186 1 presence of sulfur in the fuel. 2 Given the abilities of refiners to remove 3 sulfur from the diesel fuel, we need to clean them up as 4 soon as possible. Other observers have suggested 5 alternative caps and averaging systems. For example, the 6 American Petroleum Institute suggests that a cap of 15 7 parts per million would be sufficient. 8 However, the consequences of setting a cap 9 higher than 15 ppm include increased incidence of 10 particulate filter failure, deterioration of engine 11 performance, and poisoning of the NOx catalyst. For the 12 public, this means more pollution, more asthma attacks, 13 more hospitalizations, more premature deaths and more 14 cancer. We urge EPA to reject this alternative. 15 We do not support alternative proposals that 16 would allow refiners to continue producing fuel at a level 17 of 500 parts per million sulfur for a fraction of their 18 total highway diesel fuel volume. This approach or any 19 other scenario that would allow two or more other grades of 20 diesel fuel to remain in the market is sorely impractical 21 due to the reliability in misfueling implications. 22 To the extent that these alternative proposals 23 are designed to be provide flexibility to small refiners, 24 we believe this additional flexibility is unwarranted given 25 the extremely long time of six years. Furthermore, these 187 1 flexibility measures severely compromise the environmental 2 benefits of the proposed standards placing too high a 3 burden on the breathing public. 4 Secondly, the proposed nitrogen oxide standard 5 should apply to all new engines in 2007 not 2010. We 6 believe that this unnecessarily delays the smog reduction 7 benefits of the rules, prolonging the chronic smog problems 8 faced by more than 132 million Americans who live in the 9 likely ozone nonattainment areas across the nation. 10 The urgency of our need to reduce smog-forming 11 emissions can not be overstated. Over half of the nation's 12 ozone monitors have a three-year average above the 13 eight-hour ozone standard. Moreover, according to a 1999 14 study by ABT Associates, smog was the cause of more than 6 15 million asthma attacks, 150,000 emergency room visits and 16 50,000 hospital admissions in a single summer of 1997. 17 We believe that all new engines should be able 18 to meet the .2 grams per brake-horse power-hour by 2007. 19 As Mr. Bertelson stated earlier, the manufacturers of 20 emissions controls association is an association of 21 companies who are most directly involved in producing the 22 technology to achieve the standards, agree that the 23 technologies to meet the NOx standard will be available in 24 2007. 25 Again, this hinges on the availability of 188 1 clean sulfur fuel. Thus we urge EPA to eliminate 2 unnecessary delay and apply the .2 standard to all engines 3 in 2007. Short of this, we urge to you at least shorten 4 the phase-in period to a length of no more than two years. 5 Third, a technology review is unnecessary and 6 counterproductive. U.S. PIRG urges the EPA to reject the 7 suggestion by some to include a technology review for the 8 2003 time frame. We believe that the review would be 9 unnecessary, given the high degree of competence that clean 10 fuels will enable rapid development of NOx emission control 11 technology. 12 Moreover, we see the proposed technology 13 review as a disincentive to actually develop cleaner 14 engines, giving the industry an opportunity to escape from 15 the new standards contingent on their own lack of future 16 progress in developing NOx control technologies is far too 17 much like the fox guarding the hen house. It should be 18 remembered that this industry has a history of illegal 19 actions to escape from pollution standards. 20 In addition, one could read this technology 21 review as little more than opportunity to take advantage of 22 the changing political landscape under a new administration 23 and one that may not be as committed to protecting the 24 public health. 25 To the extent that you do find a technology 189 1 review is warranted we urge you to ensure that it allows 2 equally for the strengthening of the standards as for their 3 relaxation. Finally, an advanced heavy-duty technologies 4 should be encouraged. While diesel engines are known as 5 the work horse of present day transportation system, it is 6 important to acknowledge that far cleaner technologies are 7 being commercialized. 8 The promotion of these technologies, including 9 fuel cells, hybrid and electric propulsion systems can 10 lead to critical additional public health and environmental 11 benefits. We strongly support the inclusion of the Blue 12 Sky program to define a set of propulsion technologies 13 and/or a set of lower emissions standards for vehicles to 14 be designated for receipt of incentive under subsequent 15 local state or federal programs. Thank you 16 MS. OGE: Thank you. Mr. David Bartlett. Good 17 afternoon. 18 MR. BARTLETT: Thank you. Good afternoon. My 19 name is David Bartlett. I am here on behalf of the Diesel 20 Technology Forum. The Forum is a new group that is working 21 to enhance public dialog with a wide-range of stakeholders 22 including the EPA, other government agencies, and other 23 interested parties to explore a wide range of opportunity 24 to reduces emissions from both existing and from new diesel 25 engines, while recognizing the inherent benefits of diesel 190 1 technology. 2 Diesel power systems, that is the engines, 3 fuels and aftertreatment systems that are the subject of 4 today's hearing power our economy from package delivery 5 trucks that you see on the street everyday to tractor/ 6 trailers delivering fresh produce from the fields to the 7 neighborhood grocery store. They are the very centerpiece 8 of our Nation's supply and distribution network. But they 9 are also much more. 10 With the age of the Internet and E-commerce, 11 diesel power systems have taken on an even more important 12 role facilitating the greatest economic expansion this 13 country has ever seen. They are doing more work, moving 14 more goods, and helping more businesses and people than 15 ever before. 16 This proposal to reduce emissions and require 17 cleaner fuels in new diesel trucks and buses starting in 18 2007 marks yet another milestone in the continuing 19 improvement of diesel technology. New diesel engines 20 powered with today's fuels emit less than one-eighth the 21 emissions of engines built just over 12 years ago. If 22 adopted, the proposal currently under consideration by the 23 EPA could result in as much as a 90-percent reduction in 24 emissions beginning in 2007, and that's on top of 25 improvements already on line for 2002 to 2004. 191 1 We support the direction of the EPA's proposed 2 rule that will result in lower diesel emissions and cleaner 3 diesel fuel in 2007. We are especially pleased that for 4 the first time EPA has used the systems approach in setting 5 fuel and engine standards. An approach that recognizes 6 that engines and fuel are both parts of an integrated 7 diesel power system. 8 A systems approach is more important than 9 ever because for the first time engine manufacturers, the 10 companies that manufacture exhaust and aftertreatment 11 equipment, and fuel refiners all will have important rolls 12 to play in order to achieve the significant reductions in 13 emissions that EPA has proposed. 14 Whatever the outcome of the debate over how 15 much sulfur should be allowed in diesel fuel, everyone 16 agrees that lowering sulfur content coupled with advances 17 in diesel engine technology will help improve air quality. 18 While this hearing is focused on future reductions in air 19 pollution, we should not lose site of the tremendous 20 progress that has been made in the past here in California 21 and indeed across the entire nation. 22 For example, here in Los Angeles there has 23 been tremendous progress in reproducing air pollution from 24 all sources. During the period of 1994 to 1999, Los 25 Angeles had over 54 percent fewer ozone exceedence days 192 1 than in the period 1987 to 1992. With only three 2 exceptions, the number of days of unhealthy air uniformally 3 declined from Sacramento to San Diego to the South Coast 4 and San Joaquin to San Francisco Air Basins. 5 In many cases there were significantly fewer 6 days of unhealthy air, as many as 88 percent fewer days in 7 1999 compared to previous years. What is most encouraging, 8 we think, is that on a national basis overall criteria 9 pollutant emissions have declined by 34 percent from 1970 10 to 1997. This reduction has taken place during the same 11 time period that the U. S. population has increased by 31 12 percent, and the economy has more than doubled in size. 13 The gross national product has increased 114 14 percent in that same time period. How has pollution 15 declined at the same time that we have seen massive 16 increases in manufacturing, construction, transportation, 17 agriculture, and all the other activities that constitute 18 economic growth. The answer is that these activities have 19 become cleaner at the same time that Americans are 20 demanding more and more of them. 21 We see the future of diesel power systems in 22 both these trends. Diesel power systems have become much 23 cleaner and through continuous improvement, they will 24 become cleaner still. This continues to prove that we can 25 have economic growth, increasing the use of diesel 193 1 technology and cleaner air. These are consistent goals we 2 would submit. 3 Diesel power systems are an essential part of 4 the quality of life that we all enjoy today, providing the 5 most efficient, economical and reliable power for whatever 6 the need. It is a technology that is defined by innovation 7 and continuous improvement meeting the ever-increasing 8 needs of the customer, whatever the application and 9 whatever the need. 10 Make no mistake about it. This proposal 11 represents a significant technological challenge for the 12 engine manufacturers, the exhaust aftertreatment suppliers 13 and fuel refiners, all of whom are members of the diesel 14 technology forum. However, we are confident that together 15 we can build on our past progress and produce the cleanest, 16 most economical and reliable diesel power systems ever. 17 The proposal under consideration today deals 18 with new technology going forward. There are many 19 opportunities to address some important issues in the 20 existing fleet. Let me say a word about excessive smoke 21 from diesel trucks and buses. 22 When properly maintained, diesel engines do 23 not smoke. For over ten years California has been a leader 24 in the development and implementation of diesel smoke 25 emissions inspection programs. These programs have proven 194 1 benefits in identifying and eliminating excessive smoke 2 emissions. And, frankly, we wonder why only 13 states have 3 implemented such programs today. 4 We challenge the other states to consider 5 adoption of smoke-testing programs. We have the tools and 6 resources available to assist in that effort. This March 7 EPA issued a challenge to retrofit 10,000 engines in the 8 next two years and the Forum is pleased to be working along 9 side the EPA. We are bringing together resources to 10 identify engines of all types in a wide variety of 11 applications to determine the feasibility of lowering 12 emissions by adding exhaust aftertreatment systems, 13 modifying engine emissions controls, and/or using cleaner 14 diesel fuel. 15 We are encouraged by the possibilities for 16 success for this program, which will include engines in a 17 wide-range of applications from marine vessel to highway 18 trucks. In conclusion, the members of the diesel 19 technology forum while not taking a position on specific 20 fuel sulfur levels or other issues on debate today, support 21 EPA's decision to take a systems approach to reducing 22 diesel emissions. 23 However the specifics of this debate are 24 resolved, diesel power systems are poised to deliver more 25 of the efficient, reliable and economical power demanded by 195 1 the American people. As leaders in the technology and 2 innovation of diesel, members of the Forum are committed to 3 working with the EPA with state governments and with other 4 interested parties to continue the improvements in diesel 5 emissions and to take meaningful steps now to address 6 concerns in the existing diesel fleet. 7 Thank you and I would be happy to answer your 8 questions. 9 MS. OGE: Thank you, Mr. Bartlett. 10 (Whereupon, Kathleen Cagney relieved 11 Stephanie Gustave as the court reporter at 3:30 p.m.) 12 * * * 13 14 15 16 17 18 19 20 21 22 23 24 25 196 1 2 3 4 5 6 7 8 9 10 11 REPORTER'S CERTIFICATE 12 13 I, Stephanie Gustave, a Certified Shorthand 14 Reporter in the State of California, in Los Angeles County, 15 do hereby certify that the foregoing proceeding was written 16 by me in stenotype and transcribed into typewriting; and 17 that the foregoing is a true and correct copy of my 18 shorthand notes so taken. 19 20 21 22 _____________________________ Stephanie Gustave 23 California CSR No. 8680 24 25 197 U.S. ENVIRONMENTAL PROTECTION AGENCY HEARING ON PROPOSED HEAVY-DUTY ENGINE AND VEHICLE STANDARDS AND HIGHWAY DIESEL FUEL SULFUR CONTROL REQUIREMENTS LOS ANGELES, CALIFORNIA JUNE 27, 2000 Volume II, Pages 198-285 Taken at the Hyatt Regency 711 South Hope Street Los Angeles, California 90017 1 1 APPEARANCES: 2 3 E.P.A. COMMITTEE: 4 5 Chairperson: 6 Margo Oge, (Director, E.P.A. Office of 7 Transportation and Air Quality) 8 9 Committee Members: 10 Robin Morin 11 Chet France 12 Dawn Martin 13 Michael Horowitz 14 15 16 17 18 19 20 21 22 23 24 25 199 1 INDEX OF SPEAKERS 2 PAGE 3 WILLIAM HINES (U.C.L.A. Professor) 202 4 JIM STEWART, Ph.D. (Southern California 205 5 Council on Environment and Development) 6 KENNETH BALLARD (Los Angeles 10th District P.T.A.) 211 7 LELAND STEWART (Unity-and-Diversity World Council) 213 8 MONICA BENITEZ (Mexican-American Legal Defense 215 9 and Educational Fund) 10 JEFF YANN (Sierra Club and Hacienda Heights 217 11 Improvement Association) 12 JOHN DUERR (Detroit Diesel Corporation) 223 13 MARIE VALENTINE (DaimlerChrysler Corporation) 228 14 JASON MARK (Union of Concerned Scientists) 233 15 LAWRENCE WEICK (Syntroleum Corporation) 239 16 RONG LU (U.C.L.A. Research Scientist) 244 17 JERILYN LOPEZ MENDOZA (Environmental Defense) 246 18 JACQUELINE DOMAC (Venice High School Teacher) 249 19 NICHOLAS ECONOMIDES (Hart/IRI Fuel Information 254 20 Service) 21 DAN MUHTAR (U.C.L.A. Student, CALPIRG) 262 22 CATHY CHANG (U.C.L.A. Student, CALPIRG) 264 23 MARTIN SCHLAGETER (Sierra Club) 266 24 LAWRENCE LEBOWSKY (American Lung Association) 269 25 TIM MORALES (American Lung Association) 272 200 1 INDEX OF SPEAKERS (Continued) 2 PAGE 3 4 ANDREA VAN HOOK (American Lung Association) 274 5 KARYN IHARA (U.C.L.A. Student) 278 6 SMITHA GOTTIMURKALA (U.C.L.A. Student, CALPIRG) 280 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 201 1 LOS ANGELES, CALIFORNIA, TUESDAY, JUNE 27, 2000 2 APPROXIMATELY 3:40 P.M. 3 -o0o- 4 5 MS. CHAIRMAN: Thank you, Mr. Bartlett. 6 Professor William Hines, good afternoon. 7 MR. HINES: Thank you. 8 Good afternoon. My name is William Hines. I'm 9 a professor at the U.C.L.A. School of Public Health in 10 the Department of Environmental Science. I've been a 11 researcher studying airborne particles or aerosols for 12 more than 30 years. I've published more than 80 articles 13 on this topic including the textbook which has become the 14 standard textbook in this field. I am a member of the 15 E.P.A. Southern California Particulate Matter Center and 16 coprincipal investigator of the E.P.A. supersite for 17 Southern California. 18 These are major multidisciplinary research 19 efforts sponsored by E.P.A. to characterize particulate 20 matter in the Los Angeles basin and its relationship to 21 human health. 22 I support the proposed rule on heavy-duty 23 engines and diesel fuel. 24 Airborne particles are a major problem in the 25 Los Angeles basin. They are associated with demonstrated 202 1 increases in mortality and increases in hospital 2 admissions. They contain many cancer-causing materials. 3 They exacerbate asthma, and they affect lung development 4 in children. In terms of diesel emissions -- in terms of 5 particulate emissions, diesel vehicles are inherently 6 dirtier than equivalent gasoline-powered vehicles. 7 During the past three decades, we've made great 8 strides in controlling emissions from gasoline-powered 9 vehicles and industrial sources but have failed to 10 control those from diesel-powered vehicles to the same 11 level. Consequently, diesel vehicles now account for 12 nearly two-thirds of all particulate emissions from 13 mobile sources from the Los Angeles area. Diesel 14 vehicles also release significant amounts of gases and 15 vapors that cause the formation of secondary particles or 16 photochemical smog in the Los Angeles basin. 17 Currently, diesel engines are an essential power 18 plant for heavy-duty transportation because of their 19 durability, their longevity, their fuel efficiency, and 20 their low life-cycle cost. Because of their longevity, 21 they will continue to be widely used for many years. 22 Thus, timely reduction of diesel emissions will require, 23 in addition to the proposed control measures discussed 24 here, the development of after-market equipment for 25 retrofitting control technology to existing diesel 203 1 vehicles. 2 Incentives to do this need to be built in to the 3 proposed control requirements. We know from our 4 experience in controlling emissions from gasoline 5 vehicles that both new emission control technology and 6 fuel reformulation are needed to cost effectively control 7 diesel vehicle emissions. Improved combustion in diesel 8 engines requires advances in diesel engine design and 9 clean diesel fuel. Catalytic aftertreatment requires 10 technological development and clean diesel fuel. Thus, 11 clean diesel fuel is a requirement for an effective 12 control strategy for diesel vehicles. 13 The proposed measures are essential to protect 14 the health of the people in the Los Angeles basin and to 15 permit the continued air quality in this region. 16 I strongly support these measures and urge the 17 E.P.A. to implement them as soon as possible. 18 Thank you. 19 MS. CHAIRMAN: Professor Hines, thank you for 20 your testimony. 21 I'd like to thank the other panelists for taking 22 the time to come and share with us your views about this 23 very important proposal. 24 Thank you. I would suggest a 15-minute break. 25 We have, I think -- oh, we have a new reporter, 204 1 wonderful, but I need a break for about 15 minutes, and 2 it would be wonderful. 3 So we will be back five minutes after 4:00 to 4 start with our next panel. 5 Thank you. 6 (Brief recess in the proceedings.) 7 MS. CHAIRMAN: Mr. Steven Gallegos, Ken 8 Ballard, Leland Stewart -- Dr. Jim Stuart and Monica 9 Benitez, Leland Stewart and Mr. Herley Jim Bowling. 10 MR. STEWART: Not all of them are here. 11 MS. CHAIRMAN: We will start with you. Welcome 12 to this panel, and we will start with you, Mr. Stewart. 13 MR. J. STEWART: Thank you. 14 Well, I certainly want to complement you on this 15 amazing, wonderful outreach, and the breadth of the 16 proposal is excellent. Of course, my understanding is is 17 that if we could get it down to five parts per million, 18 then things would really be clean. But that would be our 19 request. 20 Now, you've heard already this morning the 21 report from the MATES-II Study and, of course, you're 22 well familiar with that, and there are two tables in the 23 MATES-II Study. One says that diesel is 71 percent of 24 the toxic risk, and another says that it's 82 percent of 25 the toxic risk. And I want to emphasize we should be 205 1 using the 82 percent because that is properly weighted 2 according to toxicity. 3 Then the other thing that is important, I think, 4 in the MATES-II Study is the sources of diesel 5 particulates. So I have -- I put on every one of your 6 places there this. It says, "Jim Stewart Presentation," 7 you know, "E.P.A. Presentation" at the top. So inside it 8 talks about the sources of diesel particulates according 9 to the MATES-II Study. This, I actually had to pull out 10 of the MATES-II Study and just go through and present the 11 numbers in a clearer form than is in there. But it's the 12 same numbers as the MATES-II Study. 13 What you notice is that 49 percent is, as we 14 expected, the heavy-duty diesel trucks. The 34 percent 15 mobile equipment is the shocker. I mean this is -- we 16 are talking about, you know, the kinds of construction 17 equipment, right, the bulldozers, and all that sort of 18 thing. So this makes it very clear that in terms of the 19 South Coast Air Quality Management District we could not 20 even consider having duel-fuel tracks. I mean we've got 21 to get that mobile equipment down to exactly the same 22 level as the main diesel trucks, and so that you can't 23 even consider if you want to clean up the diesel issue in 24 our region having anything other than everybody having 25 the 15 parts per million. Is that clear? 206 1 Okay. The second thing, of course, we want to 2 point out here is the ships. And that -- I mean, I don't 3 know how you guys are going to do that. If we can't get 4 these ships -- I mean if you turn over to the other page, 5 you see that this is the map that shows, of course, what 6 the air quality -- and, of course, it was nicer, I guess, 7 this morning in color -- but what is so dramatic is that 8 huge tongue going out to sea from San Pedro and L.A. 9 ports there. 10 There's this huge tongue of black diesel soot 11 heading out to sea, and that is, of course, the ships. 12 And that 11 percent, a good portion of our diesel 13 particulates across this whole region is coming right out 14 of that harbor there. So you guys have got to clean up 15 ships. I mean there's just no choice. I mean you are 16 right now -- I mean inaction is killing the people in our 17 harbor area. As you well know that's the reports of the 18 death and illnesses in the San Pedro area. 19 You think, right, that we should be having nice 20 clean air from the ocean, but it's not the case because 21 of that huge amount of diesel soot coming out of those 22 ships. 23 Then, if you turn back to my pie chart, you see 24 that the next sources here are what you'd expect, a 25 little bit from cars and light trucks, a little bit from 207 1 the trains -- and I certainly want to encourage you guys 2 to clean up the trains -- and then we have a little less 3 than two percent of the manufacturing and industrial 4 sources which, of course, are the only sources of diesel 5 soot that the Air Quality Management District can control 6 except for urban diesel buses. And, of course, we're all 7 thrilled about the fact that A.Q.M.D. has made the rule 8 that we're not going to have any more diesel fleet buses 9 in our area. 10 But, look, right now, with primarily urban 11 diesel buses in our region, it's .2 percent. You can't 12 even see on this chart how the thin line that is coming 13 from buses. It's primarily all from other sources. 14 So here's our issue: Our issue is is that 15 A.Q.M.D. can control two percent, the manufacturing and 16 industrial, and the other 98 percent is up to you guys at 17 E.P.A. So this is it. We've got to have it, and if you 18 want to look at the actual numbers, it's on the very 19 back, and that's the actual numbers in pounds per day 20 that came out of the MATES-II Report, the heavy-duty 21 diesel trucks -- yeah, right -- the 22,000 pounds per 22 day, you know. 23 And then the next one this awful mobile 24 equipment is about 16,000. And then way down at the end, 25 we have urban diesel buses at only a 115 pounds per day 208 1 from all of the buses that are running around the whole 2 South Coast Air Quality Management Region. 3 The second issue, of course, that we need to 4 talk about is environmental justice, and I'm pleased that 5 the environmental defense people talked to you earlier 6 today. But if you go back to the map, you can see that 7 the big, heavy-polluted areas are right in the same, 8 essentially, as the heavily minority areas of 9 Los Angeles. The center of Los Angeles, South Central 10 Los Angeles, which is over 90 percent black and Hispanic, 11 Southeast Los Angeles, that finger going off to the right 12 there are 90 percent Hispanic and black. So as long as 13 we do not clean up the diesel, we are causing terrible 14 environmental injustice here. 15 Then my final point's a little off the topic, 16 but I do want to mention that none of this work on 17 cleaning up diesel is going to address the issue of 18 global warming, and I want to stress that we are all 19 concerned about the issue of global warming, and that the 20 only thing I can see to tie global warming in to this 21 issue today relative to diesel is we need full cost 22 accounting. 23 In other words, the issue is is that right now 24 we are essentially subsidizing the nonrenewable -- in 25 other words -- the fossil fuel, burning fossil fuels, 209 1 adding CO2, raising the sea level, flooding the coasts of 2 the country. Of course, in a few years we'll probably be 3 losing the southern half of Florida, but the issue is is 4 that we're not including that in the pricing. The 5 pricing of diesel is well -- well, it's just the price of 6 what it costs to pull it out of the ground and refine it. 7 What's the cost to Florida? I mean I would say that, you 8 know, it's probably a few trillion dollars to -- if you 9 flood the whole coast of -- the southern half of Florida. 10 So the issue is is do we want to really 11 address -- this is not the purpose of this thing, but I 12 just wanted to mention to you guys from E.P.A. that it's 13 time that we begin to continue to look at the full cost 14 accounting of what burning fossil fuels is causing right 15 now in terms of the rising sea level, the dangers 16 relative to the whole issue of storms and the increasing 17 temperatures right now. I mean, it looks like in 18 California like we're going to be losing our snow pack 19 which means we're going to be losing our water supply, 20 and we're going to be in really terrible trouble. 21 I guess then my final point is really simple, 22 and I'm sure you've heard this earlier today is that the 23 truckers and the guys who are driving the bulldozers on 24 this construction equipment don't want to be killing 25 people. They'd like to be driving clean trucks, so do 210 1 the right thing. 2 Thank you. 3 MS. CHAIRMAN: Thank you, Mr. Stewart, 4 appreciate your comments. 5 Mr. Ballard, good afternoon, welcome. 6 MR. BALLARD: Thank you for giving us the 7 opportunity to present our various opinions. 8 I'm representing L.A. 10th District P.T.A. which 9 is 30,000 members of P.T.A. south of the Santa Monica 10 Mountains in the L.A. Unified School District. I gave 11 you a two-page outline of what I wanted to say. I'm 12 going to give you the short form however. I'm sure 13 you'll be happy to hear that. 14 One is that the P.T.A., both state and national, 15 has had a long history, at least back to 1973, of asking 16 for clean-air studies, and full information to the 17 public, and cleaning up the air. We recommend that 18 school buses be included in all regulations relating to 19 cleaner exhaust partly because in Los Angeles it looks as 20 if we're going to be having busing for a long time, 21 unfortunately, and the students, because they are not 22 air-conditioned buses, are sitting in these diesel buses 23 which really emit a lot of visible smoke, never mind the 24 things that you can't see, and it's grossly unfair that 25 the children should be exposed to that sort of thing. 211 1 The third point is the P.T.A. is concerned that 2 the criteria that you use in measuring improvements in 3 vehicle exhaust give the reality of increased safety and 4 not just the appearance. And your web-posted rulemaking 5 documents and facts sheets, chapter 2, pages 79 through 6 76 address this issue very well. 7 The issue loosely is there is a temptation when 8 competing technologies go to the public to say "Well, our 9 engine produces half as many pounds of particulate matter 10 as this engine over here," and it doesn't take into 11 account the very complex nature of the issue which has to 12 do with particle size, where those particles go in your 13 lungs, how much surface area has material that's the 14 result of incomplete combustion on them, and what are 15 those chemicals that are on the particles because 16 absorbed particles of vapors which are absorbed do not 17 leave your alveoli, the end ducts of your lungs, as 18 quickly as they would if they would if they stayed as a 19 gas. 20 Most of the explanations, perhaps of research 21 necessity, that I've read tend to express parts per 22 thousand, parts per million, but not in a biological 23 sense. I'm a pharmacist, and I have a pharmacy 24 background. The question is how do these things go into 25 the body? How long do they stay, and what are the 212 1 effects? And I don't know how you can take a complex 2 issue like this -- although it's well represented in your 3 website and presented to the public -- but my concern is 4 those who have not solved the technical problems will try 5 to use arguments which are not biologically significant 6 to express the advantages of their system over competing 7 systems. 8 Finally, we support strongly any movement toward 9 cleaning up the air. It doesn't have to be perfect. It 10 should be technology-driven with serious consideration as 11 to the cost. But by cost, I agree with my colleague 12 here. It's the true cost, namely, all of us are 13 breathing this stuff, and it's critical that we remove it 14 from the air as soon as possible. 15 Thanks again for the opportunity to present. 16 MS. CHAIRMAN: We thank you. 17 I believe it's Reverend Leland Stewart. 18 Good afternoon. 19 MR. L. STEWART: Good afternoon. 20 I come with a somewhat different orientation to 21 most of you who are here, and so the leave the technical 22 details to the environmentalists to give that part of 23 it. I did want to call attention, however, to two people 24 that have spoken here who are not only friends of mine 25 but also who represent the religious interests that I 213 1 have. 2 The first one is Reverend Al Cohen with the 3 Southern California Ecumenical Counsel. That represents 4 main-line Protestantism primarily, which is his 5 orientation, and we used to share the same headquarters 6 which was very close to here for many years. Then the 7 other person is Dr. Gary Herbertson who spoke earlier. 8 Gary is on our board. 9 The organization that I'm with is called the 10 Unity-and-Diversity World Council which represents two 11 kinds of organizations. We do a great deal of interfaith 12 work. The difference between Al Cohen in terms of who I 13 represent is that the work that we're doing represents 14 religions rather than denominations. In other words, we 15 work with Christians, Jews, Muslims, Hindus, Buddhists, 16 and many others including a number of modern spiritual 17 movements. So we have interfaith celebrations every 18 month. So we represent something like 50 different 19 religious and spiritual groups. 20 On the other hand, as the name implies, we not 21 only work with religious groups and spiritual groups but 22 also with many other kinds of groups, United Nations 23 Association, World Federalists, and a huge number of 24 groups. And the environmental issue is very important to 25 us. Gary on our board is our environmentalist, but 214 1 there's also one other member who's very much into 2 environmental concerns. So in our counsel we have a 3 general assembly once a month to deal with these social 4 issues, and Gary is at many of the meetings. Tony 5 Blackstone is very much the environmentalist. So we come 6 from a large number of both religious and other kinds of 7 groups in our work. 8 So I would just like to say that we are very 9 concerned to improve the climate here in Los Angeles and 10 the air pollution. I've been here personally for 45 11 years, since 1955, and I remember these issues being 12 discussed way back then, and I know there's been some 13 improvement, and but there's a lot more room for 14 improvement. So we definitely want to see as much as the 15 E.P.A. can do to improve it. 16 I was talking with Jim on the way down, who is a 17 personal friend and who spoke at one of our recent 18 meetings, and I'd like also to see five percent rather 19 than 15, if that can be done. 20 Thank you very much. 21 MS. CHAIRMAN: Thank you. 22 Ms. Monica Benitez, welcome. 23 MS. BENITEZ: Thank you. Thank you for having 24 me here. 25 On behalf of the Mexican-American Legal Defense 215 1 and Educational Fund, I urge you to adopt tough emission 2 standards for trucks and buses as soon as possible. The 3 number of diesel trucks that go through the Los Angeles 4 residential neighborhoods is a significant concern 5 especially to our organization. 6 A group of U.C.L.A. students conducted a focus 7 group in the Boyle Heights area. This is the part of the 8 graduate studies in urban planning. And what they did is 9 they monitored traffic for two half-hour time periods 10 between 2:00 to 3:00 p.m. which is the exact time when 11 elementary schools get out, and what they found was that 12 a total of 123 diesel vehicles passed through that 13 particular area. 14 Now, this is a big concern for obvious reasons 15 because of all of the toxins and particulate matter that 16 can trigger respiratory problems in children. And this 17 is primarily this area, the Boyle Heights area, as well 18 as, I believe, somebody had previously mentioned these 19 areas that have the most minority children, minority 20 families, are the areas that have to face these highly 21 contaminated toxic air polluted areas. 22 Not only air pollution, we're talking about all 23 sorts of kinds of pollution, soil pollution. But it is 24 these inner city children and families that are the most 25 affected by diesel pollution. 70 percent of the Latino 216 1 children live in areas that exceed the ozone standard 2 compared to 51 percent of white children. And, 3 unfortunately, these are the people that live in poverty 4 and cannot afford to move out and, also, people that rely 5 on public transportation. 6 L.A., without a doubt, needs more buses, but it 7 is just as important to have buses and transportation 8 vehicles that don't pollute the community and that don't 9 make people sick. 10 And I just want to end with one last comment in 11 that I think that it's time that we really start 12 investing in the children that are the most vulnerable, 13 the neediest, and the poorest in our country. I hope 14 that you consider the testimony here today in your final 15 decision-making, and that you really do adopt the 16 toughest possible standards to reduce pollution. 17 Thank you. 18 MS. CHAIRMAN: Thank you, Ms. Benitez. 19 Mr. Jeff Yann, good afternoon. 20 MR. YANN: Thank you for your patience and 21 perseverance. 22 My name is Jeff Yann. I am environmental chair 23 of the Hacienda Heights Improvement Association which is 24 a mutual-benefit corporation that represents 55,000 25 residents in our unincorporated community. I'm also a 217 1 member of the Sierra Club's air quality committee. 2 Hacienda Heights sits in a crucial position in 3 the South Coast air basin. We're essentially where the 4 funnel starts that conveys the off-shore breezes over 5 San Gregornio pass every afternoon. In addition, we're 6 just downwind of the 605 Freeway, and the Pomona Freeway 7 bisects our community. The Pomona is among the busiest 8 in the basin for traffic from the harbors to the 9 Interstates 10, 15, 40, and points in the eastern United 10 States. 11 Plans are being developed right now for a 12 dedicated truck lane which will likely parallel the 13 Pomona Freeway to haul traffic from the Alameda Corridor 14 to the east. In addition, we have the nation's second 15 largest landfill immediately up-wind of our community 16 which generates over 4,000 vehicle trips per day. Most 17 of those vehicles are trash trucks powered by diesel 18 engines. 19 We were delighted to see South Coast A.Q.M.D. 20 take strong steps toward requiring diesel buses and trash 21 truck fleets to clean up their act by moving to compress 22 natural gas and alternative fuels along with installing 23 particulate traps for existing engines. We ask E.P.A. to 24 take even stronger steps toward eliminating the severe 25 health impacts that diesel engines pose to our community 218 1 and, in fact, to the whole Los Angeles basin. 2 When I started my career as an engineer in the 3 electric utility business, power plants had thermal 4 efficiencies around 40 percent, poured sulfur fumes and 5 high NOx out their stacks. When I worked in the field, 6 our cars were covered with yellow spots of sulfur 7 corrosion spots at the end of the day. When I left the 8 business 31 years later, it was a very different 9 industry. 10 Before I retired, I was project engineer on a 11 project to repower one of these older facilities using 12 two new gas turbines in a combined-cycle mode. Each of 13 the gas turbines was more efficient, larger, and cleaner 14 than the whole power station they were repowering. Their 15 hot gases could generate enough steam to fully run the 16 existing steam turbine. The result was a power plant 17 with three times the output for twice the fuel -- a 50 18 percent efficiency increase with nine parts per million 19 NOx and no sulfur. 20 At the same time, the conventional units were 21 being equipped with selected catalytic reduction. Though 22 the utilities complained a great deal when that was 23 imposed, ultimately technology developed led to those 24 installations being installed at a fraction of the cost 25 that were initially proposed. These innovations allowed 219 1 the industry to point with justifiable pride with what we 2 were able to accomplish. And why? Because regular 3 authorities set the standards that forced us to make this 4 remarkable progress. Cleaning up our air basin has 5 spawned new technologies, created new jobs, and you can 6 now see the mountains occasionally during the summer. 7 I urge the E.P.A. to continue these same 8 incentives for the diesel industry and help prevent 9 40,000 premature deaths that result from soot pollution 10 nationwide by adopting strong regulations to reduce 11 sulfur, NOx, and particulate releases from diesel trucks. 12 It is well documented that a direct relationship exists 13 between fine particulate pollution in the air and 14 hospitalization for respiratory ailments. 15 I'm a firm believer in capitalism as a means for 16 driving economic progress, but I also believe that 17 subsidies impede that progress. Subsidizing polluters by 18 letting the health industry bear the costs, bear the 19 economic impacts is the worst kind of subsidy. E.P.A. 20 certainly knows this firsthand. Right here in the 21 San Gabriel River Aquifer, E.P.A. is conducting an 22 evaluation of how to prevent health impacts in a Super 23 Fund Site that used to be one of the best groundwater 24 aquifers that we have in the basin. 25 The message of that pollution is clear. Once 220 1 the pollutants are released into the environment, there 2 is no easy way to get them back or prevent their impacts. 3 The same is true of diesel emissions. The only way to 4 control these toxic and carcinogenic emissions is to keep 5 them out of the exhaust pipe. Your proposed regulation 6 is the right step. Let this technology pay the cost to 7 clean up the problems they create for the rest of us who 8 breathe the air in Los Angeles. Only on that basis can 9 we then decide if clean diesel is still the way to go or 10 what other -- some other technology that has already paid 11 these clean-up costs can do the job better, electric 12 technologies, compressed natural gas, other technologies 13 have been mentioned that can move freight around this 14 country. 15 As Jim mentioned, these technologies not only 16 cut emissions of criteria pollutants but of greenhouse 17 gases as well. This is not an issue of jobs versus the 18 environment. It is simply a question of a technology 19 bearing the cost burden necessary to keep from putting 20 people at risk. Although much is made of negative 21 impacts upsetting environmental standards, these 22 standards do not cause jobs to go down. Instead they 23 promote new technologies and the workers to bring those 24 new technologies into production. 25 Often technology is developed to reduce smog in 221 1 Los Angeles spread throughout the country and even the 2 world as other regions face the same problems that we 3 face creating even more jobs. As a result, those workers 4 and all of us can live healthier, more productive lives. 5 It's not the job of E.P.A. to figure out what these 6 technology developments will be or how industry will go 7 about meeting them. 8 Just as with putting catalytic converters on 9 automobiles as with getting the lead out of gasolines, as 10 with putting S.C.R.s on utility boilers, let the industry 11 that say this can't be done put their wisdom instead into 12 figuring out the best way to do it. We simply need to 13 make sure the standards are high enough that when they do 14 finally get the job done, those of us in Hacienda 15 Heights, the basin, and the world can live better, 16 healthier lives. 17 I urge you to adopt the proposed reductions for 18 diesel emissions. 19 Thank you. 20 MS. CHAIRMAN: Thank you, Mr. Yann. 21 I'd like to thank all the panel members for 22 caring enough about this issue to come share your views 23 with us. Of course, we will consider all your comments 24 seriously as we're moving forward towards the end of the 25 year to finalize this problem. Thank you again. 222 1 I will call the next panel: Mr. John Duerr; 2 Mr. Jason Mark; Ms. Marie Valentine; Ms. Jerilyn Lopez 3 Mendoza; Ms. Gladys Mead; Mr. Larry Weick; Mr. Rong Lu; 4 and Ms. Jaqueline Domac. 5 I have seen a number of you around since the 6 morning, so I appreciate your patience in staying until 7 late afternoon to testify. 8 So we'll start with you, Mr. Duerr. Good 9 afternoon. 10 MR. DUERR: Good afternoon. 11 My name is John Duerr, and I'm here to today 12 representing Detroit Diesel Corporation. Detroit Diesel 13 is a major manufacturer of diesel engines including 14 heavy-duty on-highway engines which are the subject of 15 today's rulemaking. Detroit Diesel is pleased to have 16 this opportunity to present our views on this important 17 rule. At the outset, let me say that Detroit Diesel is a 18 member of the Engine Manufacturers Association and the 19 Diesel Technology Forum, and we support the statements 20 made by both of those organizations earlier today. 21 Detroit Diesel wants to congratulate the Agency 22 in adopting a systems approach in this rulemaking by 23 proposing substantial fuel quality improvements in 24 support of the extremely challenging new engine emissions 25 standards. Heavy-duty highway engines have been 223 1 regulated since the early 1970s, and, since that time, 2 there have been remarkable reductions in engine 3 emissions. By the time the 2004 emission standards take 4 effect, NOx and particulate emissions will have been 5 reduced by approximately 90 percent. Carbon monoxide, 6 hydrocarbon, and smoke emissions from diesel engines have 7 also been reduced substantially and today stand at levels 8 that are roughly 10 percent of the current standards. 9 For the most part, these impressive emission 10 reductions have been achieved through improvement in 11 engine design. Although this approach has been 12 successful in the past, I believe I can state without 13 fear of contradiction that the 2004 standards are very 14 close to the limits of what can be achieved with engine 15 modifications alone. Any substantial emission reductions 16 beyond those reflected in the 2004 standards will require 17 the use of exhaust aftertreatment. Efficient and durable 18 exhaust aftertreatment systems depend on the availability 19 of very low-sulfur diesel fuel. Thus, Detroit Diesel not 20 only supports E.P.A.'s approach of considering diesel 21 fuel quality and engine emission standards together in 22 this rulemaking, we believe this is the only viable path 23 for achieving significant reductions of significant 24 magnitude. 25 While Detroit Diesel believes that reductions in 224 1 diesel fuel sulfur levels are key to achieving the next 2 level of emission standards, we are not certain if the 3 NOx standard that E.P.A. has proposed will be feasible 4 even with fuel meeting a 15-ppm sulfur cap. The proposed 5 0.2 grams per horsepower-hour NOx standard will require 6 the development and use of an aftertreatment system with 7 over 90 percent effectiveness over an extremely broad 8 range of engine operating conditions. Detroit Diesel is 9 not aware of any systems that have demonstrated this 10 level of effectiveness in the laboratory, let alone meet 11 the requirements of a production feasible system with 12 minimal deterioration in effectiveness over the full 13 435,000 mile useful life period. We're continuing to 14 review and analyze the available data and will provide 15 more detailed information regarding the feasibility of 16 the proposed NOx standard and adequacy of the 15-ppm 17 sulfur cap before the end of the comment period. 18 On a related issue, the preamble to the proposed 19 rule indicates that supplemental Not-To-Exceed and 20 steady-state provisions which are yet to be finalized as 21 part of the still-pending 2004 rulemaking will apply to 22 the proposed 2007 standards. It is further noted that a 23 number of modifications to these provisions are expected 24 relative to the proposal that was released in October of 25 1999. These provisions have a very significant impact on 225 1 the stringency and feasibility of the proposed standards. 2 Since we have not, as yet, seen these finalized 3 provisions, we cannot assess their impact or comment 4 meaningfully on how these provisions affect the technical 5 feasibility of the proposed standards. Because of the 6 extreme importance and complexity of these provisions, 7 E.P.A. must provide assurance that there will be adequate 8 time in this rulemaking for comment on the technical 9 feasibility of this proposed rule after the 2004 10 rulemaking has been finalized and the supplemental 11 provisions have been made available for public review. 12 Detroit Diesel appreciates E.P.A.'s intent to 13 provide flexibility by proposing an optional phase-in for 14 NOx, N.M.H.C., and formaldehyde standards. While this 15 approach has been successful in managing the transition 16 to the new standards for light-duty vehicles, we believe 17 this program will be unworkable for heavy-duty engines 18 because customer preferences, cost factors, competition 19 between engine manufacturers, and issues related to truck 20 design will make it impossible for engine manufacturers 21 to manage sales to meet the proposed phase-in schedule. 22 As an alternative, we suggest that two-step 23 implementation for the substantial reduction in the NOx 24 plus N.M.H.C. standard applicable to all heavy-duty 25 diesel engines in 2007 and the second large reduction in 226 1 2010. 2 We believe a two-step implementation will avoid 3 the problems associated with managing engine sales is 4 more aligned with technology readiness and can achieve 5 emission reductions that are equivalent to E.P.A.'s 6 proposed phase-in schedule. 7 One aspect of the proposed rule that Detroit 8 Diesel finds troublesome is that the Agency did not 9 include any changes to the emission test procedures. The 10 emission test procedures that manufacturers are required 11 to use in certifying and auditing engines were developed 12 in the early 1980s and were first applied when NOx and 13 particulate standards were 10.7 and 0.6 grams per 14 horsepower-hour respectively. These procedures were 15 never designed to provide reliable measurements at the 16 extremely low emission levels represented by the proposed 17 standards. Testing programs conducted jointly by E.P.A. 18 and industry show that the emission measurement 19 variability using these procedures is approximately the 20 same magnitude as the proposed standards. With testing 21 variability of this magnitude, it will simply not be 22 possible to reliably determine if the proposed standards 23 are being met. Clearly, substantially improved test 24 procedures and equipment need to be developed. 25 Further, the procedures must be developed with 227 1 sufficient lead-time to allow manufacturers to obtain and 2 install the necessary equipment to upgrade their 3 laboratory facilities and complete the development of 4 compliant engines before the new standards take effect. 5 Because of the -- 6 MS. CHAIRMAN: Mr. Duerr, you may want to take a 7 short break and get a glass of water. We can wait. We 8 can be here late in the evening. 9 MR. DUERR: I just have a little bit more. 10 MS. CHAIRMAN: Okay. 11 MR. DUERR: Because of the magnitude and time 12 criticality of this task, we believe E.P.A. must take 13 immediate action to convene a group of Agency and 14 industry experts to begin the important work of 15 developing improved emission tests procedures. 16 Again, Detroit Diesel appreciates this 17 opportunity to present our views on this important 18 rulemaking. We will follow up with more detailed 19 comments on a number of issues before the end of the 20 comment period. 21 Thank you. 22 MS. CHAIRMAN: Thank you. 23 Ms. Valentine, good afternoon. 24 MS. VALENTINE: Good afternoon. 25 My name is Marie Valentine. I am here to speak 228 1 on behalf of DaimlerChrysler on the subject of the 2 E.P.A.'s proposal to modify heavy-duty vehicle emission 3 control regulations and on-highway diesel fuel 4 requirements. 5 DaimlerChrysler is a vehicle manufacturer of 6 light-duty and heavy-duty vehicles that operate on 7 gasoline and diesel fuels. DaimlerChrysler is a 8 demonstrated leader in the development of environmentally 9 sound vehicle technologies. This is evidenced by our 10 commitment to support the pursuit of tough emission 11 performance goals. 12 Reducing heavy-duty emissions will aid in 13 achieving the nation's air quality emissions goals, and 14 we stand ready to do our part. This is a logical 15 follow-up to the Tier 2 light-duty vehicle emission 16 regulations adopted last December. We agree that E.P.A. 17 needs to look at all pollution sources when determining a 18 comprehensive emission reduction plan. 19 In our opinion, the combination of the 20 low-sulfur on-highway diesel program with feasible, 21 stringent new emission standards for heavy-duty engines 22 and vehicles will assist in improving air quality 23 nationwide. We congratulate E.P.A. for continuing to 24 link vehicles and fuels as was recently done in the Tier 25 2 regulations. This system approach is the only way to 229 1 achieve the emission reduction envisioned. 2 We commend E.P.A.'s initiative to propose a 3 15-ppm sulfur cap for the on-highway diesel fuel. This 4 critical first step will enable the continued development 5 and advancement of diesel emission control technology 6 that is necessary if the heavy-duty industry is to meet 7 the new proposed standards which reflect a 90 percent 8 reduction in NOx and PM. 9 Sulfur is a poison that blocks the use of 10 aftertreatment technology by rendering the hardware 11 inoperable at today's 500-ppm level. The developers of 12 the aftertreatment technologies have indicated that a 13 very low level of sulfur in diesel fuel is critical for 14 future development of these devices. The lower level 15 will permit catalyst-based control strategies to be 16 optimized for maximum emission reduction efficiencies. 17 Recent data indicate that sulfur-free diesel 18 fuel is the enabling requirement for the use of NOx 19 absorbers, Continuing Regenerating Technology systems, 20 and Selective Reduction Catalysts due to their 21 sensitivity to sulfur. Further information on this will 22 be included in our written comments. 23 The world's engine manufacturers have defined 24 sulfur-free diesel fuel, as specified by the "World-Wide 25 Fuel Charter," as the correct fuel to enable the use of 230 1 NOx and PM aftertreatment technologies where stringent 2 emission standards are required. Therefore, the sulfur 3 level in diesel fuel must be reduced to allow the use of 4 aftertreatment technology as an emission control strategy 5 for diesel vehicles as has been so successful for 6 gasoline vehicles. 7 Let me emphasize that the proposed sulfur cap is 8 only the first step needed for diesel fuel. A sulfur- 9 free diesel fuel with a minimum cetane of 55 and a 10 maximum 15 percent aromatic limit is ultimately 11 necessary. This fuel composition would support the use 12 of diesel fuel in the light-duty vehicle market and 13 provide the benefits of reduced emissions and increased 14 fuel economy -- another goal of the current 15 administration -- while also maintaining customer 16 satisfaction. 17 A diesel powertrain is an important option for 18 passenger vehicles. Diesel vehicles could have a 19 significant role in the reduction of fuel consumption by 20 offering a 40 percent fuel economy advantage over 21 gasoline vehicles on a miles-per-gallon basis. The 22 sophisticated diesel vehicles currently in the European 23 market have higher endurance, reliability, and torque, 24 which is a desirable performance attribute. On the 25 emission side, diesel vehicles have inherently low 231 1 hydrocarbon and carbon monoxide emissions, no evaporative 2 emissions, and have long-term stability of emissions, 3 which will be further reduced with aftertreatment, but 4 the enabling fuel is necessary. 5 We applaud the incentives by some oil companies 6 to deliver clean diesel fuel to some localized markets in 7 advance of the regulations. The lesson learned is that 8 cleaner fuel can be made available, and it is being done 9 at an affordable price. 10 Should a phase-in of clean on-highway diesel 11 fuel be found necessary, we encourage E.P.A. to have it 12 start in 2004. The oil industry has previously 13 challenged E.P.A. to make all known changes in one step, 14 not two separate steps so capital investment strategies 15 can be optimized. Therefore, the 2004 suggested start 16 date would link diesel with the gasoline sulfur control 17 required by Tier 2, and allow light-duty clean diesel as 18 a viable powertrain. 19 In conclusion, let me restate the key points of 20 our message: 21 First, E.P.A.'s proposal of a reduced sulfur 22 diesel fuel for on-highway is a great first step. 23 Second, clean fuel packaged with feasible 24 emission standards is the correct path to enable further 25 reduction in emissions. 232 1 DaimlerChrysler believes that the diesel fuel as 2 specified in the "World-Wide Fuel Charter" is necessary 3 to enable low emissions and fuel-efficient technologies. 4 DaimlerChrysler is continuing to review the 5 proposal and plans to submit written comments addressing 6 other issues in the N.P.R.N. and expands further on our 7 diesel fuel position. 8 Thank you for the opportunity to speak to you. 9 MS. CHAIRMAN: Thank you. 10 Mr. Jason Mark, finally. You've been here the 11 whole day. Thank you for your patience. 12 MR. MARK: Well, thank you very much, and I 13 thank you for your patience as well. I think you've 14 experienced a real outpouring of support from concerned 15 citizens in the Los Angeles area. I think it's probably 16 an experience you've had all around the country, and it 17 suggests that we really have a significant challenge 18 ahead of us, and everyone is very exited about it. 19 My name is Jason Mark. I am the transportation 20 codirector of the Union of Concerned Scientists, and I 21 want to share with you a couple of thoughts, and I've got 22 a couple slides in just a second. But I recently did an 23 interesting -- what I found actually surprising -- 24 back-of-the-envelope calculation and just try to put this 25 diesel solution issue in perspective. 233 1 It turns out that the average diesel truck on 2 the road, on the highways today in America emits three 3 times more smog-forming pollution and three times more 4 soot than the average coal-fired power plant per unit of 5 energy burned. In other words, in terms pounds per BTU, 6 NOx with hydrocarbon was three times higher for the 7 average diesel truck than the average coal power plant in 8 the United States and three times higher for cities, as 9 well. 10 It sort of, I think, helps us puts in 11 perspective that what we're really talking about here are 12 smoke stacks on wheels rolling through our neighborhoods, 13 our urban centers, and on our highways. Fortunately, 14 over the course of a number of regulatory proceedings in 15 California, both in the Los Angeles area and statewide 16 over the last year, we've heard proof-positive from the 17 industry that they've got the technology that will bring 18 diesel in line, hopefully, with coal power plants and 19 much, much cleaner over time. 20 If I could just show a few slides here, three 21 short ones, and then I'll be out of your hair, one of the 22 pieces, obviously, that is quite critical for EPA to rule 23 is developing strong engine standards as soon as 24 possible. We certainly encourage you to accelerate or 25 eliminate the phase-in for the for the NOx standards. 234 1 I -- also, on the diesel fuel issue near-zero sulfur is 2 clearly an absolute priority. In my perspective, there 3 is really -- you left yourself no room for bargaining 4 when it comes to sulfur levels. You can't go any higher 5 technologically. It's an absolute priority to hold the 6 line, no room for bargaining, per se, with the oil 7 industry on this issue. 8 Then I want to spend the bulk of the -- just a 9 couple minutes talking about real-world emissions. I see 10 this as a critical issue, one that we have to address 11 right now before we get into a situation, at least in 12 California, where we're dealing with a smog check program 13 that is in substantial financial and political difficulty 14 as well as creating emissions losses for the state. 15 And there I think while history has shown that 16 cars in the real world are much dirtier than they are 17 during an emissions test, either administrated by the 18 E.P.A. or the California Air Resources Board, the 19 conventional wisdom is then that diesel trucks don't have 20 a real-world emissions problem. I think that 21 conventional wisdom changed -- if I may have, I think, on 22 the next slide -- conventional wisdom changed when there 23 are a series of testings that suggested the number of 24 engines -- a number of engines were having troubles with 25 this defeat device. 235 1 In consulting the consent decree is based on 2 E.P.A.'s estimates on per-mile emissions rates for 3 noxious hydrocarbons for the 1998 model engine, and the 4 next bar would be the emissions a, quote, unquote, legal 5 truck. By E.P.A.'s own estimates, those emissions 6 increased by 70 percent per mile as a result of defeat 7 devices. And then this, there's the final bar in 8 California estimates is from the yet-to-be-finalized 9 Amfac (phonetic) 2000 analysis, but it suggests that in 10 reality the increase from defeat devices is well over a 11 factor of two. 12 It suggests that the world is changing, that, in 13 fact, when we didn't have to worry about deterioration 14 and any of these problems in the past, now we do. I 15 would suggest that that situation is only going to get 16 worse as we consider exhaust control technology, that, at 17 least in the light-duty sector, is clearly demonstrated, 18 had some kinks worked off that took us several decades to 19 get substantial progress. 20 I certainly applaud the engine -- excuse me -- 21 the auto industries and the exhaust control manufacturers 22 for really beginning to seriously address the emission 23 problem for automobiles. Let's make sure we don't create 24 a similar problem from heavy-duty vehicles. 25 So the next chart, please. This is your 236 1 U.C.S.'s more on-the-back-of-the-envelope calculation 2 estimating the impact deteriorations could have on the 3 E.P.A.'s projected benefits. As was noted earlier, 4 E.P.A. projects for the year -- these are emissions 5 results for the year 2030, assumes that engines starting 6 in the year 2007 don't deteriorate whatsoever, that 7 despite the fact even E.P.A.'s modeling suggested 2004 8 engines will deteriorate. 9 The assumption is that magically deterioration 10 goes away in the year 2007 as a result of this rule. 11 Clearly I would suggest that the history, if passes any 12 prologue, that perhaps that it's not a fair assumption. 13 What we've done is looked at a couple different 14 scenarios. What if, for example, heavy-duty engines 15 deteriorate just at historic rates, the same rate you 16 assume the emissions deteriorate for model year 2004 17 engines? What if that continues for the next 30 years? 18 Turns out that emissions for particulates, for example, 19 would double in the year 2030. 20 Now, what if we assume that because we're 21 including exhaust control equipment that may be prone to 22 failure in the real world, in real-world driving 23 conditions, that the historic deterioration rate actually 24 doubles, perhaps deterioration because of malfunction. 25 Then, all of the sudden, particular emissions quadruples 237 1 compared to E.P.A.'s projected benefit. What that 2 suggests is that while we may be assuming we're going to 3 get a 90 percent reduction for smog-forming pollutants 4 and particulate matter as a result of the E.P.A. rule, 5 those benefits could be substantially eroded. In fact, 6 they could perhaps be cut in half as a result of 7 deterioration of malfunctioning engines. 8 We clearly think that advanced technology has an 9 important role to play here by providing an intrinsically 10 clean technology that may not be prone to deterioration 11 or which the technology has much less of a burden placed 12 upon it. That, you can deal with that. And that's what 13 the final bar on this chart suggests is that aggressive 14 introduction of advanced technology can help mitigate the 15 impacts of real-world pollution. 16 If we can go back to the first chart, just to 17 summarize. We certainly feel that in-use tests, on-board 18 diagnostics, Not-To-Exceed limits are absolutely vital in 19 your 2004 goal. The incentive for inherently cleaner 20 technologies, however, is the prudent pathway. It's the 21 diversified, no-regret strategy for dealing with an issue 22 that I think we have yet to really grapple with in the 23 regulatory community and the public health community the 24 fact that heavy-duty engine technology is, in fact, much 25 dirtier in the real word than it is during the 238 1 laboratory-like Federal tests. 2 Thank you. 3 MS. CHAIRMAN: Thank you. 4 Mr. Larry Weick, welcome. The microphone should 5 be on. 6 MR. WEICK: Is it on. 7 MS. CHAIRMAN: Yes. 8 MR. WEICK: Okay. Very good. 9 Good afternoon, Madam Chairman, and members of 10 the committee. My name is Larry Weick, and I'm the 11 vice-president of business development for Syntroleum 12 Corporation. My company has developed a commercial 13 process to convert natural gas into ultraclean fuels, 14 this fuel here, and is a leading licensor of this 15 technology in the oil and gas business. Of specific 16 interest of this hearing is that Syntroleum has developed 17 a paraffinic, high-cetane synthetic diesel. My comments 18 will focus on the impact synthetic diesel can have on the 19 U.S. transportation industry. Syntroleum strongly 20 believes that blending this synthetic fuel in the present 21 diesel fuel can assist refiners in meeting the 10-cap-15 22 diesel sulfur requirement by 2007. 23 Synthetic diesel has been developed and tested 24 by Syntroleum and others, and they meet or exceed all the 25 properties of the ASTM D975 and are highly suitable for 239 1 conventional and advanced compression ignition systems in 2 both North American and the European markets. 3 Additionally, Syntroleum synthetic diesel has 4 been demonstrated to be viable for fuel cells. So it's a 5 bridging fuel. Synthetic is psychically similar to 6 petroleum-based diesel, but it has superior combustion 7 emission characteristics containing no sulfur, no 8 aromatics, no olefins, and no metals. Just as 9 significant, it's compatible with the existing fuel 10 distribution infrastructure from the refinery tank all 11 the way to the pump. 12 Syntroleum has recently submitted a petition to 13 the Department of Energy requesting that the secretary 14 initiate a rulemaking to add these synthetic fuels to the 15 list of alternative fuels under EPAct. Syntroleum 16 synthetic fuel has the qualities which make an ideal fuel 17 for assisting refiners in blending this 10-cap-15 limit. 18 As part of the EPAct process, Syntroleum has independent 19 testing that compared the engine emissions from this fuel 20 with conventional E.P.A. Number 2 California CARB spec 21 diesel, and Swedish City diesel. CARB diesel and Swedish 22 City diesel, as you know, are the cleanest diesel 23 fuels currently commercially available. Under a variety 24 of test conditions that are part of the written 25 testimony, Syntroleum synthetic diesel reduced the 240 1 criteria pollutants, NOx and particulate emissions range 2 from 11 to 38 percent. These are significant percentage 3 reductions. These benefits can also be realized 4 immediately because synthetic diesel can be used in 5 existing conventional diesel engines incorporating 6 advanced sulfur exhaust treatment technologies that we 7 heard about earlier today. 8 Moreover, it's a relief and a pleasure to point 9 out to the E.P.A. and the American public and, 10 particularly Californians, that this synthetic diesel 11 under discussion has a very low solubility in water. 12 Additionally, laboratory testing indicates that this fuel 13 has significantly lower toxicity than conventional diesel 14 and is much more biodegradable. 15 As large trucks and SUVs continue to grow in 16 popularity, including in California, the shift from 17 gasoline to diesel engines is growing each year as 18 evidenced by a 12 percent growth rate for the two-year 19 period '96-'98, and a 44 percent growth rate for '97-'98. 20 Of particular interest to this hearing is the 21 need for clean diesel fuel to meet Tier 2 standards. The 22 demand for diesel in U.S. transportation sector is 23 growing. This is diesel is growing three times faster 24 than gasoline. If this growth and diesel demand 25 continues, an additional 100,000 barrels a day of 241 1 incremental diesel fuel will be needed each year just to 2 keep pace. The available synthetic diesel will help the 3 industry meet this growth. Synthetic diesel will enable 4 the refining industry to have more flexibility to blend 5 and meet the anticipated increased demands for diesel. 6 This fuel is a proven technology-neutral fuel 7 that has the potential to revolutionize the 8 transportation fuels and reduce emissions. But meeting 9 the 2007 deadline for 15-ppm diesel is not the only 10 consideration of this hearing. There is the issue of how 11 to refiners will meet increased demand. World clean 12 diesel production will need to increase in the face of 13 well-documented deteriorating fuel quality, oil quality, 14 as evidenced by the increasing -- steadily increasing 15 sulfur content and increasing oil gravity. The expected 16 increase in competition between the U.S. and the EU and 17 and elsewhere for these high-grade crude oils as a 18 strategy for making low-sulfur fuels will not help. 19 There's not enough clean oil to go around. 20 If production of ultra clean diesel was 21 dependent only on conventional feedstock, the task would 22 be daunting indeed. However, the production of synthetic 23 fuels and synthetic diesel changes the equation. These 24 synthetic fuels are the future. The potential resource 25 of natural gas for synthetic fuel production worldwide is 242 1 a very large and, as accounted for by some, larger than 2 the present world oil reserves. It may take a decade 3 before total synthetic fuel production exceeds a million 4 barrels a day. 5 However, synthetic fuel production is expected 6 to grow exponentially as technology improvements continue 7 to lower production costs and increase returns on project 8 investments. During the next 10 to 15 years, blending of 9 conventional diesel with synthetic diesel would be an 10 effective means of upgrading lower quality diesel fuels 11 and meeting expected growth. 12 By the end of the decade, we believe any synthetic fuels 13 will be well on their way to becoming a significant 14 component of this world fuel pool. 15 In conclusion, the broader use of these 16 synthetic fuels will bring significant environmental and 17 energy security benefits to the U.S. during the next 18 decade and beyond. Syntroleum strongly believes that the 19 expected increased availability of these fuels will 20 dramatically assist refiners in meeting the 10-cap-15 21 targets by '07 by blending the in-place fuel streams and 22 augmenting refining capacity that will be economically 23 challenged by required reduced sulfur production. 24 Thank you, again, for this opportunity to 25 speak. 243 1 MS. CHAIRMAN: Thank you. 2 Mr. Rong Lu, good afternoon. 3 MR. LU: Thank you for the opportunity for me to 4 speak. 5 My name is Rong Lu. I'm a research scientist at 6 the University of California in Los Angeles. I have 7 studied the air quality problem for many years. The 8 greater Los Angeles area is still the most polluted area 9 in the whole nation. Toxic gases and the fine particles 10 in the air have a very harmful effect on public health 11 and welfare. I'm here to urge you to adopt the toughest 12 possible standard to reduce the emissions of toxic gases 13 and particulate matter, especially those from the diesel 14 exhaust. 15 I'd like to show one slide here. Here, I want 16 to show one. Based on recent scientific research, the 17 average cancer risk in the Los Angeles basin is about 18 1,400 per million people. And that means that the 19 individual person who stayed in the Los Angeles basin 20 for 70 years and have 1,400 per million chance -- in a 21 million chance of contracting cancer. Mobile sources 22 include cars, trucks, trains, ships, and aircraft with 23 the greatest, largest contributors. 24 However, it's obvious that about 70 percent of 25 the risk is attributed to the fuel particulate matter 244 1 emissions. So, in other words, diesel particulate 2 emissions lead to one in a thousand chance of contracting 3 canister. 4 In order to protect the public health, we must 5 require the dramatic reduction of the pollutant 6 emissions, especially the diesel emissions from these 7 large trucks and buses as soon as possible. I strongly 8 support the E.P.A. proposal to significantly reduce the 9 emissions from heavy-duty engines and vehicles. Based on 10 advanced technology, such as the highly efficient 11 catalytic converters and low-sulfur fuels, the approach 12 could be the most cost-effective way to reduce emissions 13 of ozone precursors and particulate matters. 14 Specifically, I urge you to reduce the diesel 15 sulfur level to no more than 15 parts per million 16 nationwide for both on- and off-road diesel engines by 17 2006 and also clean up all the big trucks and engines, 18 and ensure that the big trucks to meet the emission 19 standard on-road, not only just during the test. 20 Finally, I urge you to increase the use of 21 diesel alternatives such as clean fuel, electric, and 22 fuel cell buses. 23 These measures are critical to protection of 24 public health and environment. I hope you seriously 25 consider them in your final decision-making. 245 1 Thank you. 2 MS. CHAIRMAN: Thank you. 3 Ms. Jerilyn Lopez Mendoza, good afternoon. 4 MS. LOPEZ MENDOZA: Good afternoon. Thank you 5 for the opportunity to speak to you today. Sorry, the 6 mike is having trouble. 7 My name is Jerilyn Lopez Mendoza. I'm a staff 8 attorney in the Los Angeles office of Environmental 9 Defense. Our office in Los Angeles is dedicated to 10 environmental justice issues. We have three main areas 11 of focus. The first is alleviating exposure to toxins. 12 The second is promoting the equity in transportation. 13 And the third is increasing the amount of green space, 14 clean and green, schools, parks, and playgrounds for the 15 children of Los Angeles. 16 I know it's the end of the day. I'm going to 17 try to be as brief as possible. I do have written 18 comments that I brought that I believe you have before 19 you. 20 Two main points I want to make: First of all, 21 our office is very much in favor of the new standards 22 that you have before you that you are considering. We 23 are very much in support of any new regulations that will 24 decrease the amount of particulate matter, NOx, toxicity, 25 and other carcinogens that in the air in Los Angeles. 246 1 However, the second point I want to make -- and it's the 2 only big point I want to make -- I do want to import to 3 you a sense of urgency about these issues. 4 Everyone is talking about the MATES-II Study 5 that the A.Q.M.D. has done. I think all of us have drawn 6 from their report in bringing up various matters, one I 7 will bring up to your attention is on page 2 of my 8 written comments. We know that the areas that are most 9 impacted by air toxins in the Los Angeles region are 10 South Central and Southeast Los Angeles. What we have 11 done is put together census data -- admittedly from 1990, 12 however, we don't think the demographics have changed 13 very much -- just to show that who is impacted by air 14 toxins in the Los Angeles region. 15 If you look at the numbers, over 60 percent of 16 people living in South Central Los Angeles live below the 17 poverty line. Over 90 percent of the people who live in 18 South Central are African- American or Hispanic. In 19 Southeast Los Angeles, over 40 percent of people living 20 in that community are living below the poverty line. 21 And, again, over 90 percent of the people in that region 22 are also African-American or Hispanic. 23 The most vulnerable areas of our communities are 24 being the most impacted by air toxins, and this is true 25 of a lot of areas throughout the country where there's 247 1 environmental injustice and where the people living in 2 low-income communities are doubly impacted because they 3 do not have access to the decision-making process, and 4 they bear the brunt of the environmental degradation of 5 their community. 6 For these reasons, we are urging you as quickly 7 as possible to enforce these standards. Seven to 10 8 years down the line is simply too long to wait, 9 especially for people living in these communities who 10 bear the brunt of these problems. Human health and air 11 quality are affected every day. It's getting worse every 12 day. It's to promote cleaner air for all of us in 13 Los Angeles, to improve human health, to bring the entire 14 region closer to attaining of public health standards, 15 relieve the burden on low income and communities of 16 color, overall to just achieve environmental equality for 17 all of us living in Los Angeles. 18 We really urge you to move as quickly as 19 possible to enforce the strongest standards available to 20 try to decrease the amount of toxins that our communities 21 are being exposed to every day. 22 Thank you very much. 23 MS. CHAIRMAN: Thank you, Ms. Mendoza. 24 And our final person in the panel -- is it 25 Ms. Jacqueline Domac. Good afternoon. 248 1 MS. DOMAC: Thank you. Hi. My name is 2 Jacqueline Domac, and I'm a high school health teacher at 3 Venice High School, and I'm happy to be here. Thank you. 4 When I was first asked to testify here, I was 5 very stressed about knowing all the facts and making sure 6 as an educator I would be able to convince you about the 7 statistics and about how many people are dying and how 8 horrible it is and the pollutants. I realized that I 9 really didn't need any facts to be here. 10 I'm sure there was a time when people sat at 11 tables like this and debated whether or not there should 12 be slavery or whether people actually had the right to be 13 free. And there is also a time when people sat at tables 14 like this debating whether or not women have the right to 15 vote. And, to me, there just doesn't need to be any 16 statistics for that. Clean air seems to be a right, and 17 I don't think that it is debatable. 18 My students have a really tough life, and I have 19 to face many problems with them every day from their back 20 grounds that they come from. It is not uncommon for me 21 to hear that their friend was shot on the corner and 22 their head blown off and now they're dead. It's not 23 uncommon for me to hear of students who can't have their 24 permission slips signed because they land in so many 25 foster homes, they don't know who now is their legal 249 1 guardian, and just simple economic necessities, just the 2 burdens placed upon them just to get to school every day 3 and to have food in their bodies so they are able to 4 learn. 5 As a teacher of health, I tell them there's a 6 lot of things not in their control, and I would like to 7 be able to tell them that at least their air quality, the 8 air that they breathe every day, is in their control and 9 that they will not be doomed, and that the E.P.A. is 10 doing something about that to help their environment, 11 because where I teach is a polluted area, and a lot of 12 them come from severe economic back grounds, and, as the 13 previous speakers have said, those people are being 14 affected the most. 15 I grew up in Pacific Grove, California, where 16 the air was very, very clean by Carmel and Pebble Beach, 17 and I went to Berkeley which was then at least clean air 18 up in the area, and I'm really saddened to be in 19 Los Angeles teaching where the air is really, really 20 gross. I'll be giving a lecture in class and have a 21 diesel truck go by, and all the fumes come into the 22 classroom, and it's disgusting. 23 At least when pot comes in through the windows, 24 there's something I can do about it. I can call the dean 25 and have that removed and alleviate the situation. But 250 1 we look upon you to do something about the diesel fuel 2 emissions, because there is little someone can do at this 3 level other than to pressure you to do that for us. And 4 since we are facing so many other problems in schools 5 right now, this is the very least that you can do is to 6 provide clean air for our students to breathe and for the 7 animals and for the plants and the little lizards outside 8 my house. 9 Everything deserves to have some clean air, and 10 I hope that you will pass the strictest possible laws and 11 do it in the most efficient manner as possible. 12 Thank you. 13 MS. CHAIRMAN: Thank you. 14 Mr. Duerr, I have one question. I know it's 15 late in the day. Probably my colleagues are saying, 16 "What is she doing?" Well, this morning and, actually, 17 during this whole day today and the other hearings that 18 we have had on this very important proposal, we have 19 heard very positive, actually amazingly positive support 20 from the companies that are going to make those 21 technologies, and this morning you heard the 22 representative of the Association and Mr. John Mooney 23 from Engelhart (phonetic) with the positive support that 24 they have given us that indeed those technologies if 25 they're not here today, they're going to be here by the 251 1 time that these standards are required. 2 So my question to you is in your testimony, both 3 your oral testimony and your written testimony -- and I'm 4 reading it -- it says that Detroit Diesel is not certain 5 if the NOx standard that the E.P.A. suggests will be 6 feasible even with the fuel meeting the 7 15-parts-per-million sulfur cap. And I wanted to ask 8 you, first of all, are you going to be able to provide 9 more definitive input to the record, because indeed we're 10 going to be making decision by the end of the year? And, 11 obviously, we're talking about six, seven years' time 12 frame, and what is your view, optimism or lack of 13 optimism, as far as the ability of your company to exceed 14 those standards given the time -- today, the colleagues 15 in your industry and the aftertreatment technology 16 manufacturers? 17 MR. DUERR: I hope we can provide some more 18 definitive information, although, I'm sure our crystal 19 ball is not going to become totally clear before this 20 rulemaking is concluded. One of our concerns -- and I 21 tried to express it here -- is that we have not yet seen 22 the final regulations regarding the supplemental test 23 procedures. 24 And I think as the Agency is well aware, that is 25 a concern of not only Detroit Diesel but manufacturers as 252 1 a whole. And we certainly recognize that that will have 2 impact on the feasibility of the standards. And, in 3 addition, you know, we can look at the particulate side, 4 and we can look at the NOx side independently and maybe 5 get some optimism that those standards can be 6 individually achieved. But then it's the issue of can we 7 integrate systems in such a way that both standards can 8 be met and be met through the extended useful life that 9 that equipment needs to perform? We just don't have all 10 that knowledge yet. We're trying to build that 11 knowledge, and hopefully we can be more optimistic. 12 MS. CHAIRMAN: I appreciate your comments. 13 Again, what strikes me throughout this public 14 hearing process is the positive feedback that we're 15 getting through these public hearings from all the 16 colleagues, many of your colleagues, in the industry and 17 especially the aftertreatment technology companies that 18 obviously, as you heard this morning, are spending 19 millions of dollars in developing those technologies. 20 So we all need to continue the dialogue 21 including your company and those companies that are going 22 to be providing those aftertreatment technologies. After 23 all we're talking about seven, 10 years' time frame, and 24 we're hearing from other members of this panel that 25 seven, 10 years is too long. 253 1 Thank you very much. I want to thank especially 2 the concerned citizens for taking time in coming forward 3 to testify on this important proposal and your comments 4 will fully be considered as we're moving forward to 5 finalize this. 6 Thank you. 7 We will proceed with our next panel: 8 Mr. Nicolas Economides, Jim Morales -- Tim -- 9 Mr. Lawrence Lebowsky, Martin Schlageter, Cathy Chang, 10 Ms. Mary Edie, Dan Muhtar, and Andrea Van Hook. 11 Please forgive me if I didn't pronounce your 12 names properly. 13 Mr. Economides, we'll start with you. Good 14 afternoon. 15 MR. ECONOMIDES: Good afternoon. 16 MS. CHAIRMAN: Definitely I'm pronouncing your 17 name correctly. 18 MR. ECONOMIDES: I'm comfortable with that. 19 MS. CHAIRMAN: Okay. 20 MR. ECONOMIDES: Good afternoon. 21 My name is Nick Economides, and I am the 22 director of refining and reformulated fuels at Hart Fuel 23 Information Services. For almost 20 years, Hart has 24 provided quality information, consulting services, and 25 analysis to the worldwide refining and automotive 254 1 industries as well as the state, federal regulatory and 2 legislative officials and public policy makers. 3 As part of these overall efforts, we feel we 4 have a unique perspective on the individual and 5 collective needs of the industry, and we're happy to be 6 here today to discuss a little bit more of the refining 7 economics of the proposal particularly as it pertains to 8 the synthetic diesel aspects that you heard a little bit 9 about earlier from Syntroleum Corporation which develops 10 and licenses a cost-effective process based on Fisher 11 Drokes (phonetic) technology from clean natural gas. 12 Understandably most of the testimony you 13 received here today and in the previous hearings held in 14 the past week involved the feasibility, necessity, cost 15 effectiveness, and economic implications of producing a 16 cleaner, conventional -- that is based on petroleum 17 refining -- diesel fuel. 18 We applaud your efforts to address the 19 significant pollution contribution the diesel sources 20 represent. We're comfortable that the proposed maximum 21 of 15 parts per million is not only technologically 22 feasible but also necessary to propel us into the next 23 generation of cleaner diesel fuels. Such fuels will 24 undoubtedly be needed as we struggle to meet the 25 greenhouse gas emission targets that lie ahead of us. 255 1 It is already widely recognized that diesel 2 provides a substantially more fuel efficient fuel than 3 gasoline and is generally more reliable and easier to 4 maintain. Your action or your proposed action will drive 5 the last remaining aspect of diesel marketability in our 6 view, and the one that has suffered the most up to today, 7 that is environmental performance. 8 Diesel can be made cleaner. In fact, diesel can 9 and should be made clean enough to compete with 10 alternative fuels for similar operations. E.P.A.'s 11 action ensures that this long overdue change is finally 12 under way. 13 From the synthetic fuels perspective, the debate 14 over the cost impacts of your proposal in conventional 15 refining is only a small piece of the picture, and, 16 although presently the loudest, it is certainly not the 17 one with the longest term strategic implications from the 18 national energy policy and the global environmental 19 significant standpoint. Rather, we believe that the 20 wide-scale introduction of such technology holds the 21 potential to profoundly affect the oil and gas 22 industries, as you heard earlier, and to fundamentally 23 change the way we approach the challenges of cleaner 24 fuels that lie ahead of us such as the low-sulfur diesel 25 fuel requirement. 256 1 You've heard about the technical aspects in the 2 strategic significance of the process already in the 3 previous panel, so I'm not going to dwell on that. What 4 I do want to talk about is the opportunities that this 5 process provides us within the context. This process can 6 be applied effectively both at the oil well to unlock 7 what we call "stranded natural gas resources" or to allow 8 the development of oil resources that would otherwise not 9 be produced unless the associated gas that you typically 10 get when you explore for oil is handled in an economic 11 and environmentally friendly manner. 12 More importantly in the context of this 13 rulemaking, it be can used to produce superior synthetic 14 fuel that can be used directly as finished diesel or 15 introduced in the conventional refining schemes as clean 16 blend stock components that can extend the volume of 17 clean diesel that any refiner of conventional fuel can 18 produce. 19 The diesel products of the Syntroleum process 20 are totally free of sulfur, as you heard, nitrogen, 21 metals, cetanes, aromatics, and all the other 22 undesirables that are typically found in traditional 23 hydrocarbon products derived from crude oil. 24 Furthermore, it's almost exclusively paraffinic with few 25 or no complex cyclic hydrocarbons or oxygenates that 257 1 would require further separation processing before a 2 finished product can be obtained. 3 Therefore, the environmental attractiveness of 4 Fisher Drokes diesel standards beyond the fact that it is 5 sulfur-free the synthetic diesel is also of exceptional 6 cetane and, of course, aromatic quality. Prospects for 7 diesel among the strictest in the world require emissions 8 performance equivalent to a reference fuel with a cetane 9 value of 48 while Syntroleum's diesel product in cetane 10 value nexus of 70. Similarly, the maximum aromatic 11 specification of car diesels reference fuel is 10 volume 12 percent. As you heard, this synthetic has no detectable 13 aromatics. 14 The combined impact of the absence of sulfur, 15 nitrogen, and aromatics coupled with the high cetane 16 value yields a substantially improved emissions 17 performance for this fuel. This, in turn, makes it a 18 prime candidate to be used as a dilution blend stock to 19 enable refiners to accommodate substantially inferior 20 blend stocks in their fuel while meeting the 21 progressively stricter standards that we have in front of 22 us today. 23 The Naptha portion that is produced in the 24 Syntroleum process is also completely paraffinic and also 25 making it suitable for further processing in a 258 1 conventional refining scheme. In fact, the C6 plus the 2 Fisher Drokes Naptha could represent the valuable 3 dilution of blend stock for the existing refinery pool of 4 aromatics and olefins, particularly if it's octane that 5 can be accommodated in an integrated refinery scheme, 6 for example, one where we are planning on using a 7 combination of down-stream methanol blending. 8 Lastly, we have the transportation advantages of 9 Fisher Drokes which enable us to move the products in the 10 conventional scheme, in other words, the same ships and 11 the same pipelines that are used to use move conventional 12 fuel are the ones that will be used to move the synthetic 13 products. All of these advantages, however, the strong 14 favorable environmental characteristics, and so on, are 15 pointing an increasing application of gasoline 16 (unintelligible) technology for the years to come. 17 However, the marketplace has taught us a clear lesson 18 that none of this would have -- would come to pass if the 19 economics did not walk side by side with all the rest of 20 us. 21 And what I'm here to emphasize for you is that 22 this technology's potential from an economic standpoint 23 is every bit as attractive as it is from an environmental 24 standpoint. There are some five trillion cubic feet of 25 worldwide gas reserves, according to the "Oil and Gas 259 1 Journal." Approximately half of that gas is stranded, 2 in other words, without any ready application. 3 Given a ratio of conversion of 10 to 1, that gas 4 could be converted to 250 million barrels of synth fuels 5 which is almost equivalent to all the estimated oil 6 reserves of Saudi Arabia. I mean we are talking about 7 tremendous volumes of material, clean fuel that can be 8 produced in this range. 9 Now, what will that mean? Let's say, in a 10 recent study that was done actually by the Arthur 11 Andersen Company, we found that by unlocking enough gas 12 to make 100,000 barrels of Fisher Drokes' products, a 13 company of the size of Texaco, for example, could 14 increase its price and its earnings per share by 15 approximately 26 percent assuming the same PE multiple. 16 This would result just by reducing depreciation, 17 depletion, and amortization on a per-barrel basis as the 18 DBNA pool is spread over a larger reserve base. And this 19 will be -- in addition to that, we would have substantial 20 economic benefits accruing from the Fisher Drokes' plant 21 itself. 22 And what are these benefits? We have been 23 conducting a number of refinery linear model simulation 24 runs at Hart/IRI to see what the value of these products 25 are in the conventional refining scheme. We have found 260 1 them to be in the vicinity of five to 10 dollars per 2 barrel over conventional diesel in a low-sulfur 3 environment. These economics are driven not only by 4 increased clean product values, but also by economics as 5 it appears that refiners with access to this material as 6 a blend stock component will be able to increase crude as 7 well as process a more economical crude slate. 8 As you might expect, the highest value scenarios 9 are those involving refiners processing heavier crude, 10 such as local California crudes, Mexican crudes, and so 11 on, with limited hydrocarbon processing and little 12 dearomatization capability. New markets requiring the 13 strictest new standards, again, such as the ones we have 14 here in California. 15 And I will conclude by saying that the proposed 16 rule to reduce sulfur content is, again, the necessary 17 first step on the road to tomorrow's cleaner fuels, and 18 we applaud the Agency for its initiative. We're 19 confident that the future holds even more promise for the 20 environmental performance of the diesel engine and fuel 21 system, and we look forward to the combined advent of 22 superior diesel fuels and the engine advances that will 23 undoubtedly accompany them. 24 It makes little sense for us to dwell on the 25 fact that 15-ppm sulfur spec versus the 30-ppm average 261 1 spec while the market forecloses on diesel. Let's 2 concentrate on taking diesel to the next level of 3 environmental performance as quickly as possible. We 4 have a lot of ground to make up and a lot of impatient 5 folks, as we heard out there, who have been waiting for 6 us to step up to the plate for quite some time now. 7 Thank you very much for the opportunity to speak 8 today. 9 MS. CHAIRMAN: Thank you, Nicholas. 10 Mr. Dan Muhtar, good afternoon. 11 MR. MUHTAR: Good afternoon. My name is 12 Dan Muhtar. I'm a student at U.C.L.A. and a member of 13 CALPIRG. I was asked to read a statement from Mary Ann 14 Garvey. She's the president of the Los Angeles 10th 15 District P.T.A. 16 She says: "I regret that I'm unable to 17 attend the E.P.A. (unintelligible) public hearing 18 on June 27th in Los Angeles. I am instead 19 representing Los Angeles 10th District P.T.A. at 20 the national P.T.A. convention in Chicago. 21 However, I do want to commend you for the E.P.A. 22 proposal that will require engine makers to meet 23 tight particulate and carbon monoxide tailpipe 24 limits and require the oil industry to remove 25 sulfur from diesel fuel. Reducing particulate 262 1 matter by 90 percent and nitrogen oxide by 95 2 percent as well as reducing the sulfur component 3 of diesel fuel by 97 percent will go a long way 4 to improve the quality of air in Los Angeles. 5 "As early as 1973, the California 6 State P.T.A. adopted a resolution on air 7 pollution with the result that continuing 8 encouragement could be given to legislative 9 policies which would promote solutions for the 10 existing problems of air pollution. Thus, I 11 encourage you to adopt a strong diesel fuel 12 policy. In 1997 the national P.T.A. adopted a 13 clean-air resolution which is recognizing -- that 14 air pollution such as nitrogen oxide, and 15 particulate matter, sulfur dioxides, and other -- 16 others have a detrimental affect on children's 17 health. 18 "(Unintelligible) College based 19 organizations to support regulations addressing 20 air quality. The 10th District P.T.A. supports 21 this strong E.P.A. regulation. Since diesel 22 vehicles emit at least 50 percent of the 23 dangerous soot particles in Los Angeles, nearly 24 one-third of the smog-forming nitrogen oxides. 25 "Los Angeles needs cleaner air. Most 263 1 of the driving I do on the freeway -- is on the 2 freeways, and the emissions from buses and trucks 3 is most noticeable. However, last week I was 4 driving on a surface street and came upon a 5 school bus that was spewing clouds of black 6 exhaust. I immediately rolled up my window and 7 switched lanes to avoid the pollution. People on 8 the street do not have this option. In fact, 9 while I was planning to turn on a to a particular 10 street, I elected not to because the school bus 11 was making the same turn. Instead, just to avoid 12 traveling behind the bus, I chose a different 13 route. 14 "Diesel exhaust is dangerous for 15 everyone to breathe. It is a particular health 16 risk for children and the elderly. I urge the 17 E.P.A. to act with stringent regulations. Let's 18 clean up the air in Los Angeles and the rest of 19 the nation. 20 "Sincerely, Mary Ann Garvey." 21 MS. CHAIRMAN: Thank you. 22 Miss Cathy Chang, welcome. 23 MS. CHANG: Good afternoon. 24 My name is Cathy Chang. I am a student at the 25 University of Los Angeles -- University of California, 264 1 Los Angeles, and I'm also a representative of the 2 organization of CALPIRG, and I was asked today to share 3 with you a short letter from the Wilmington North 4 Neighborhood Association. 5 And the letter reads: "Dear Administrator 6 Browner, on behalf of our 120 members of 7 Wilmington North Neighborhood Association, we 8 urge the E.P.A. to adopt tough new emission 9 standards for heavy-duty trucks and buses as soon 10 as possible. 11 "Our community of Wilmington is adjacent 12 to the Port of Los Angeles. We suffer the abuse 13 of thousands of container trucks daily spewing 14 their diesel exhaust fumes whether traveling or 15 just idling their motors waiting for a load. 16 This is in addition to open storage of petroleum, 17 coke, and an open storage pile of sulfur. 18 "We have elementary schools that are 19 just blocks away from container traveling and 20 idling trucks that ply our streets daily, and, 21 what with the expansion of the Port of 22 Los Angeles and adjacent Port of Long Beach, it 23 will continue to get worse. 24 "Won't you stop and listen to the 25 affected persons who, with increasing health 265 1 problems, are trying to tell you something? 2 Passenger cars had to comply with the rules. You 3 should have had the trucks and buses comply at 4 the same time. Is it going to be too late for 5 anything to be done before more people have to 6 suffer with continuing health problems? 7 "W.N.H.A. urges you to act as soon as 8 possible to rectify this health problem. 9 "Sincerely, Gertrude Schwab, president 10 of the Wilmington North Neighborhood 11 Association." 12 Thank you for your time. 13 MS. CHAIRMAN: Thank you, Miss Chang. 14 Mr. Martin Schlageter, good afternoon. 15 MR. SCHLAGETER: Good afternoon. Thank you. 16 My name is Martin Schlageter, and I am here 17 representing the Sierra Club and its 60,000 members in 18 Los Angeles and Orange County welcoming you to 19 Los Angeles, and I'm very pleased that you are not only 20 undergoing this process but that you came to visit us 21 here today. I also want to appreciate that you've had a 22 long day, and I do have copies of my testimony, so I'll 23 be brief. 24 Because you've come all the way to Los Angeles, 25 let me tell you a little bit about what's happening here, 266 1 and I apologize if I'm repeating something. 2 The City of Los Angeles has recently affirmed 3 its commitment to a clean-air policy and its support for 4 alternatives to diesel fuel. It's also beginning to look 5 into how it could retrofit diesel with cleaner 6 technology. 7 The Metropolitan Transportation Authority here 8 has, again, rejected diesel in favor of purchasing 9 cleaner alternative-fuel buses. It has a longstanding 10 policy for this, and it, too, has begun to look toward 11 retrofitting the existing dirty diesel buses with cleaner 12 technology. 13 In Orange County, the transportation authority 14 has also rejected dirty diesel buses in favor of 15 purchasing cleaner buses. 16 Private fleets and operators, as you may have 17 heard from today, have begun -- albeit somewhat slowly -- 18 have begun to move towards alternative fuels and cleaner 19 technology. And, most recently, the A.Q.M.D., the Air 20 Quality Management District, has set a strict regulation 21 that effectively bans the purchase of diesel buses in -- 22 for new additions to public streets. It not only will 23 encourage alternative fuels, but it is beginning, then, 24 also to look towards retrofitting some of the old fleet 25 vehicles with cleaner technology. 267 1 Now, all of this is just what's happened within 2 the last month, so you can see that there is a lot of 3 momentum to go in the direction you're going, and that 4 momentum here locally has affirmed what the Sierra Club 5 and other environmentalists believe, and that's there is 6 no going back to dirty, deadly diesel. 7 So all more reason for you to be here today. We 8 appreciate what you have in front of you. We appreciate 9 the process you're undertaking. I do want to encourage 10 you to go as quickly as possible and as strictly as 11 possible to reduce the sulfur content to as near to zero 12 as possible certainly by no later than 2006, to reach a 13 90 percent emissions reduction as quickly as possible, 14 certainly no later than 2007, and to keep in your rules 15 strong incentives for alternative fuels and the 16 advancement of cleaner technology. 17 We can't live literally with diesel, and so we 18 are relying upon your rulemaking here to allow us to 19 breathe easier. And, in the end, if you don't clean up 20 diesel aggressively enough, we're going to be looking at 21 how to eliminate diesel. So the chance is in front of 22 you today to act with conviction, to act with urgency and 23 immediacy, and to act with firmness on behalf of public 24 health and the environment, and then at the same time 25 then avoid a more difficult conflict later, a more 268 1 difficult choice later. 2 So I appreciate your time and your commitment to 3 this, and I thank you for the chance to take a little bit 4 of that time. 5 MS. CHAIRMAN: Thank you. 6 Mr. Lawrence Lebowsky, welcome. 7 MR. LEBOWSKY: Thank you. 8 Again, thank you for the opportunity to address 9 you here today. My name is Lawrence Lebowsky, and I'm a 10 lawyer in private practice here in Los Angeles, and I'm 11 also the immediate past chair of the American Lung 12 Association of Los Angeles County. 13 Today I'm speaking to you on behalf of our board 14 of directors and the thousands of children with asthma 15 and the people with lung disease whom we serve. We have 16 made great strides in cleaning up our air here in Los 17 Angeles. We worked hard at cleaning up cars, paints, and 18 other solvents, dry-cleaning plants, and industry. 19 On June 16th, our Air Quality Management 20 District took the bold step of adopting rules requiring 21 public fleets to make the switch to alternative-fuel 22 vehicles. In the South Coast air basin, I believe it is 23 safe to say that we are leaders in the fight for clean 24 air. 25 We have to be leaders because our air pollution 269 1 problem is huge. We breathe some of the worst air in the 2 nation here in Los Angeles. We consistently rank Number 3 1 in ozone smog pollution. The A.Q.M.D. Zone Study shows 4 that 70 percent of our cancer risk from the air we 5 breathe is due to diesel exhaust, and this means a 6 thousand cases of cancer per one million people, and that 7 is why we are serious about cleaning up our air. 8 At the American Lung Association, we have 9 witnessed an explosion in pediatric asthma rates over the 10 last 15 years. Between 1982 and 1995, the asthma 11 prevalence rate, the rate per thousand persons, among 12 children increased over 86 percent. We do not know all 13 of the reasons for this result. 14 We do know that air pollution significantly 15 affects children with asthma. These children miss 100 16 million school days annually because they cannot breathe. 17 Through our pediatric asthma programs, we warn parents to 18 watch the air quality index and not to allow their 19 children to play outside on bad air days. The A.Q.M.D. 20 sends out warnings to schools and coaches telling them to 21 keep all children inside during health advisories. We do 22 so much to protect our children, and yet every weekday, 23 these same children go to school on a bus that emits 24 thick, black clouds of asthma-inducing diesel exhaust, 25 and this must stop. 270 1 Diesel trucks and buses have been getting a free 2 ride for too long. Since the 1970 Clean Air Act, diesel 3 vehicles have actually been getting dirtier while cars 4 are getting cleaner. We cannot allow diesel trucks to 5 undo all the good work we are already doing to clean up 6 our air. These trucks must be required to have the same 7 emissions as cars. 8 The American Lung Association is pleased to 9 support the proposed rules regarding a low-sulfur diesel 10 fuel and new diesel engine standards. We strongly 11 support the low-sulfur diesel fuel provisions and view 12 the cap at 15 parts per million on sulfur as critical so 13 that the pollution controls can indeed work. 14 We would urge the E.P.A. to consider 15 implementing these rules earlier than proposed 16 particularly with regard to the nitrogen oxide standard 17 in 2010. We believe it is desirable from the viewpoint 18 of public health and feasible from an engineering 19 standpoint to have the new nitrogen oxide standards go 20 into effect in the same year as does the particulate 21 standard in 2007. 22 Through the adoption of these rules and though 23 the adoption of these rules would make history, the fact 24 is that we will not see the benefits immediately in terms 25 of a reduction of ozone air pollution. That is why we 271 1 are urging you to move up the schedule. We must start 2 eliminating dirty diesel now and not in seven to 10 3 years. Our lungs and our children's lungs deserve it. 4 I thank you for your attention. 5 MS. CHAIRMAN: Thank you. 6 Mr. Tim Morales. 7 MR. MORALES: Thank you very much. 8 I am the director of the Mexican-American 9 Community Foundation. I'm also a board member of the 10 American Lung Association. I'm here to ask you to adopt 11 your common-sense approach to cleaning up heavy-duty 12 trucks and buses. Mexican-American Community Foundation 13 administers 22 child care and Head Start centers 14 throughout the state of California primarily in urban 15 centers such as East Los Angeles. 16 East Los Angeles has the most minority 17 neighborhoods in the U.S., bears more than its fair share 18 of the air pollution burden. We have in our community 19 more industrial plants and more freeways which means we 20 have more diesel trucks rumbling through our communities. 21 African-American, Hispanic, and Asian-American children 22 are disproportionately represented in areas of high ozone 23 pollution. 24 Almost 70 percent of Hispanic children live in 25 areas like East Los Angeles that regularly exceed Federal 272 1 ozone standards. Due to this disparity, we are 2 experiencing in our community and our child care centers 3 an increase in respiratory diseases such as asthma and 4 bronchitis. This is why we need the E.P.A. proposal as 5 not only a clean-air issue but environmental justice and 6 quality-of-life issue. 7 I'm here to today to support your proposal to 8 protect the public health by looking at big trucks and 9 buses. It makes sense that you are proposing to reduce 10 sulfur levels in diesel fuel by 90 percent by 2006 before 11 other vehicle standards go into effect. I urge you not 12 to weaken this provision by allowing an extended time 13 line or higher sulfur levels. If the newer, cleaner 14 trucks do not have the 15-parts-per-million sulfur cap, 15 we will not have the necessary pollution reductions for 16 healthier life in our centers. 17 We need to also make sure that new trucks and 18 buses are meeting the emission standards on the roads not 19 just during the engine testing. Furthermore, these 20 newer, cleaner trucks should be required to meet the 21 emission standards as soon as possible. We're already 22 going to have to wait until 2007 before we see any major 23 reductions in pollution. We should not have to wait 24 until 2010 before we can get relief from smog-form 25 pollution from these trucks and buses. Instead, emission 273 1 standards should sense for smog-forming pollution should 2 be firmly implemented in 2007. 3 Finally, improving existing diesels makes sense 4 for our health and environment but also replacing them 5 with cleaner technologies makes more sense. Therefore, 6 you should consider providing incentives to increase the 7 use of advanced technology vehicles such as fuel cell, 8 electric buses and trucks. 9 We need to push the engine manufacturers, oil 10 industry, and the transportation industry further to 11 develop these new technologies because our children's 12 lungs depend upon it. 13 Thank you very much for your time. 14 MS. CHAIRMAN: Thank you. 15 Ms. Andrea Van Hook, welcome. 16 MS. VAN HOOK: Thank you. 17 My name is Andrea Van Hook. I am a staff member 18 with the American Lung Association of Los Angeles county. 19 We asked several of our children who are in our pediatric 20 asthma classes -- we teach these classes in the public 21 schools -- to write letters to you about what they think 22 about the proposed new rule, and I have these letters to 23 give to you today. I just want to briefly read you a few 24 of them so you sort of now what the kids are thinking. 25 "Dear E.P.A.: I am so glad that you 274 1 people are protecting us people with asthma, 2 because in a decade over 12,000 people die of 3 polluted air (read it in an article.) I mean why 4 did the trucking corporation know that the 5 smokestacks on trucks would make people stay 6 inside, children will miss school, adults will 7 miss work. And when I was first diagnosed as 8 asthmatic, I felt like I should move to Hawaii 9 because of the fresh air and clean water. 10 So on the first day I knew I had asthma, 11 I wanted to carry an oxygen tank stuck on my 12 mouth and covering my nose. So my mom told me 13 about the E.P.A., and told me the E.P.A. will 14 protect you. And, now, what do you know? I'm 15 writing the letter to the E.P.A.," exclamation 16 point, exclamation point, exclamation point. 17 Sincerely, Christian, age nine of Alhambra, 18 California" 19 "Dear E.P.A.: I would like to thank you 20 for your appreciation and for caring so much 21 about us kids that have asthma. I really 22 appreciate your work and consideration. You are 23 really good people. Yours Truly, Sarah, age 10 24 of Los Angeles." 25 "Dear E.P.A.: Please clean those trucks 275 1 that have smoke for kids like us that have 2 asthma. Your Friend, Byron." Byron wasn't sure 3 if he was eight or nine, so he finally settled on 4 nine. So he's nine. 5 "Dear E.P.A.: We deserve cleaner air. 6 Why I think so is because if we don't, more 7 people will get sick because of the polluted air. 8 One cause are those big dirty trucks. We should 9 get rid of them. Lots of people have asthma 10 including myself, and if our air keeps getting 11 polluted, our asthma will keep getting worse. So 12 help us to create a cleaner air. Ashlee, age 11 13 of Long Beach." 14 One more, "Dear E.P.A.: Thank you for 15 helping us and doing your job. Arica, age eight 16 of Long Beach." 17 And we have more for you from children as young 18 as five. They all know that trucks pollute because 19 they can see it, they can smell it, and they can taste 20 it, and they want you to do something about it. Please 21 keep the 15-parts-per-million cap on sulfur and develop 22 a program for checking in-use emissions. 23 We also ask you to seriously consider moving 24 up the nitrogen oxide standard to 2007, as that will 25 most directly help our smog levels in L.A. We also 276 1 urge you to provide incentives for advanced 2 technologies so that research and development of 3 cleaner, zero-emission transportation is encouraged. 4 By 2010, all of these children will be in 5 their late teens, and they will have grown up breathing 6 some of the dirtiest air in the U.S. But if you push 7 forward with this proposal, then for their children, 8 things will be a lot different. The air will be 9 cleaner, and the skies will be blue. 10 Thank you. 11 MS. CHAIRMAN: Thank you, Ms. Van Hook. 12 Obviously the testimony from these children is 13 a reminder of why we are here today and what we are 14 trying to do which is to protect the public health of 15 everyone, especially our children. Thank you very 16 much. 17 I'd like to thank you all for your testimonies 18 and taking the time to come and share with us your 19 views about this very important proposal. Now, I'm 20 told that there are some additional individuals here to 21 testify so I will call the names. 22 Thank you. 23 Richard Rolfe, Smitha Gottimurkala, Joan 24 Holmes (phonetic), Danielle Misolik (phonetic), Gene 25 Krisher (phonetic), and Karyn Ihara. 277 1 If there is anybody else here in this room, 2 there are a few people left, if you're interested in 3 testifying, please come forward. 4 MS. IHARA: Hello, my name is Karyn Ihara. I 5 am a student here at U.C.L.A. I am here today because 6 I strongly support proposals calling for tighter fuel 7 and engine standards across the nation. I think that 8 replacing dirty diesel with clean diesel is important 9 for everyone but especially for people with respiratory 10 problems. 11 I have asthma, and I can't fully describe how 12 relieved I'd be if I could actually breathe clean air 13 all the time. Although I moved down here to go to 14 school, I used to live in Sacramento. In the summer 15 when it gets really hot, we sometimes get an inversion 16 layer. That's when the air in the valley all gets 17 trapped in. All the pollutants get trapped in, also, 18 and the P.S.I. gets really high. 19 When the P.S.I. finally reaches 100 or so, 20 people with respiratory problems are encouraged to stay 21 inside all day. On those days, I stay at home if at 22 all possible because I don't want to get an asthma 23 attack. Compared to diseases like cancer and Aids, 24 asthma seems pretty harmless, but having an asthma 25 attack is a really miserable experience. It can even 278 1 be fatal. Just imagine trying to breathe by taking 2 breaths that are only a quarter as deep as normal. Not 3 only is it exhausting, it's scary. 4 Fortunately Sacramento's air only gets really 5 bad in the summer. And I now live in Westwood where 6 the air is also generally safe to breathe. However, 7 even when the air in Sacramento is only marginally 8 unhealthy, it can still make it difficult for me to 9 breathe. And, since I often need to travel to places 10 outside of Westwood, I often have to breathe unhealthy 11 air. 12 If you're still not convinced of the damaging 13 effects of dirty diesel on public health, I just want 14 to remind you that the number of people with asthma and 15 with other respiratory diseases has increased 16 dramatically. Not only does dirty diesel exasperate 17 (sic) respiratory problems, it also creates them. 18 By replacing dirty diesel with clean diesel, 19 we can take a small step towards making the air across 20 the nation healthier to breathe. Clean air is not just 21 something that would be nice to have. For some of us, 22 it's a matter of life or death. 23 Thank you for your time. 24 MS. CHAIRMAN: Thank you, Ms. Ihara. 25 And Miss Smitha -- if you would, pronounce 279 1 your name. 2 MS. GOTTIMURKALA: Yes. My name is Smitha 3 Gottimurkala, and I'm actually a representative of 4 CALPIRG, and I was a campus organizer at U.C.L.A. this 5 past year. And for the last three weeks, I have had 6 the opportunity to work with a lot of the community 7 members, the doctors, the lawyers, also the 8 environmental interest organization to come out to 9 testify today. 10 In the interest of time -- I know that you 11 guys have had a very, very long day -- I thank you for 12 your time and your patience and also extreme 13 attentiveness, like, throughout the entire day. 14 So I'm going to simply say that the varied and 15 the very, very passionate testimony that we've heard 16 all day from all these individuals, I fully, fully 17 support as a comprehensive whole. And in addition, I 18 also am fully supportive of the E.P.A.'s proposal. 19 And so -- I hate to do this to you -- but my 20 father is an invasive cardiologist, and he made me 21 promise, promise, promise to read his letter into 22 testimony. 23 MS. CHAIRMAN: Please do that. 24 MS. GOTTIMURKALA: So I'm going to go ahead 25 and read that on his behalf. 280 1 MS. CHAIRMAN: Please. 2 MS. GOTTIMURKALA: He states: "Dear Members 3 of the Board: My name Dr. Marthi (phonetic) V. 4 Gottimurkala, and I've been a practicing 5 cardiologist for the past 13 years. Thank you 6 for giving me the opportunity to voice my 7 concerns regarding health hazards of air 8 pollution due to diesel exhaust and to support 9 clean air. 10 "As a practicing cardiologist, I have 11 seen many patients with lung disease and 12 congestive heart failure who live in inner-city 13 neighborhoods and close to highways where there 14 is increased air pollution. 15 "These patients are generally elderly 16 with heart and lung problems with very poor 17 functional reserve. These patients have acute 18 exacerbation of asthma and they feel breathless 19 when exposed to polluted air with particulate 20 matter and other toxic substances which are 21 irritant and carcinogenic. 22 "Several scientific studies have 23 indicated there are increased incidents of lung 24 cancer and decreased longevity in patients who 25 live in areas with increased air pollution due to 281 1 diesel exhaust. This was documented not only in 2 this country and in Europe, but in urban areas 3 and India as well. 4 "The prevalence of asthma is on the rise 5 in the United States as well as an increased 6 death rate due to asthma by 118 percent." And I 7 think that we heard from a lot of people today 8 that that is the case. "Young children and older 9 adults who work and breathe an increased volume 10 of polluted air and those patients with advanced 11 lung disease and congestive heart failure are a 12 lot more vulnerable. 13 "In order to protect public health, you 14 must require a drastic reduction in pollution 15 from large buses and trucks powered by diesel 16 fuel. We must act now to prevent disease, 17 suffering, and death. 18 "I was disappointed to learn that the 19 E.P.A. has proposed waiting until 2010 before 20 implementing clean-up measures. Large trucks and 21 buses are among the biggest source of air 22 pollution. These must be cleaned up to protect 23 public health. 24 "I urge the E.P.A. to reduce diesel 25 sulfur levels to no more than 15 ppm nationwide 282 1 for all on- and off-road diesel vehicles 2 nationwide by 2006. 3 "Secondly, to clean up all trucks and 4 buses by at least 90 percent by 2007. 5 "Third, we must make sure that the big 6 trucks are meeting the emission standards on the 7 roads, not just during the engine tests. 8 "And finally, I strongly urge to 9 increase the use of diesel alternatives such as 10 in fuel cell buses and those that run by 11 electricity. 12 "The above measures will prevent human 13 suffering and protect the environment, and I hope 14 you give serious consideration to the above 15 issues in your final decision-making process. 16 "Thank you very much for your time. 17 Sincerely, Marthi V. Gottimurkala." 18 He's never done anything political or written 19 any sorts of letters of testimony in his life, so he's 20 quite proud of this. 21 MS. CHAIRMAN: And we're honored to have his 22 testimony. 23 Thank you very much, and this concludes our 24 fourth public hearing in this beautiful city of 25 Los Angeles. 283 1 Thank you. 2 I'm reminded we're committed to keep this open 3 to 6:30, so we will be here until 6:30. 4 (AT APPROXIMATELY 6:30 P.M., 5 THE HEARING PROCEEDINGS CONCLUDED.) 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 284 1 2 3 4 5 6 REPORTER'S CERTIFICATE 7 8 I, Kathleen P. Cagney, a Certified 9 Shorthand Reporter in the State of California, with 10 principal office in Los Angeles County, do hereby 11 certify that the foregoing proceeding was written by 12 me in Stenotypy and transcribed into typewriting; 13 that the foregoing is a true and correct copy of my 14 shorthand notes so taken. 15 16 17 18 ____________________________ California CSR Number 10850 19 20 Dated: _____________________ 21 22 23 24 25