AGC Testifies at EPA Hearing on Improvements to California’s Off-road Emissions Rule
AGC Negotiated Changes Will Save Contractors as Much as $9 Billion
AGC testified at a hearing last week called by the U.S. Environmental Protection Agency (EPA) to consider California’s request for permission to enforce its off-road diesel engine emissions standards. California officials made a series of changes to the off-road rule, after AGC discovered significant errors in the measure, that will save construction employers as much as $9 billion. AGC outlined the many improvements made to the rule during the federal hearing, concluding that “the state’s request can be fairly submitted” but noting that “even as amended… [the rule] will be a burden for contractors.”
During a multi-year-long effort, AGC submitted more than 550 pages of comments to EPA opposing California’s off-road rule. At the same time, AGC worked closely with staff at the California Air Resources Board (CARB), providing it with the necessary data and analysis to allow CARB to independently reach the conclusion that its original estimates of off- road diesel emissions in California were off by 340%. That miscalculation was one among several “significant errors” that would have been very costly to construction employers if it has been used as a basis for the state’s fleet wide emissions limits.
AGC never challenged the environmental objectives that CARB originally intended its off-road rule to achieve. Rather, AGC was committed to show that the dramatic downturn in California’s construction industry had provided an opportunity for CARB to meet those objectives without imposing all of the costly and burdensome requirements found in the rule as originally promulgated.
AGC successfully presented the case that California did not need to impose costly new "diesel retrofit" rules immediately forcing contractors to turnover nearly all of their equipment, and the state would still meet its overall objectives for reducing PM and NOx emissions. As a result of AGC’s efforts, CARB modified its proposed off-road rule to protect both the environment and the construction industry. California officials estimate the revised rule will cost 70 percent less than the original version, which industry put at $13 billion. Among the several major modifications CARB officials made to the measure was agreement to: delay the rule by four years, dramatically reduce the amount of construction equipment that construction firms would be required to replace each year, expand “early action” credits contractors could earn and expand exemptions for “low-use” vehicles.
Mike Kennedy, AGC’s general counsel, outlined the changes to the off-road rule during testimony to EPA on September 20. The agency is considering California’s request for permission to begin enforcing the emissions standards starting Jan. 1, 2014.
Kennedy stated in the testimony: “While we are not prepared to support California’s request [for federal approval], we do believe the state’s request can be fairly submitted.” But he went on to explain that: “Even as amended in December of 2010, California’s off-road rule will, however, be a burden for contractors.” Nationwide, the construction industry continues to shed capacity with anecdotal evidence suggesting that contractor defaults will be higher in 2012 than in any of the previous three years.
CARB cannot legally enforce the emission targets included its rule, or the related requirements for the turnover of existing equipment, until EPA approves of those targets.
Not only is California’s off-road rule a first-of-its-kind, but it has huge nationwide implications. Out-of-state contractors working in California must adhere to the rule. In addition, AGC estimates that as many as 30 other states may well have interest in adopting the California standards to reduce emissions from in-use, off-road diesel equipment. While the federal Clean Air Act (CAA) generally preempts such state retroactive standards, it permits California to adopt and enforce them if the standards are first approved by federal EPA. The CAA also permits other states to adopt and enforce any California emission standards that meet with EPA’s approval.
Read AGC’s full release here. Additional details on AGC’s multi-year effort are online at http://www.agc.org/carbrule.
For more information, please contact Mike Kennedy at email@example.com.
Return to Top