Clean air rules on LA-LB port warehousing, railyards loom

Port of Los Angeles.

BCOs fear imposing indirect source pollution restrictions on warehouses and distribution centers
on top of LA-LB clean-air restrictions will raise the cost of shipping through the Southern California gateway. (Above: the port of Los Angeles.)
Photo credit: Shutterstock.com.


Beneficial cargo owners (BCOs) in Southern California who already contend with clean-air requirements at the ports of Los Angeles and Long Beach could face another layer of regulations involving freight moving to and from distribution centers and intermodal rail yards.

As with other environmental programs such as the 2006 Los Angeles-Long Beach Clean Air Action Plan (CAAP) and clean-truck program, BCOs are concerned that forcing an early retirement of costly assets like trucks and cargo-handling equipment could be reflected in higher freight rates and could cause diversion of cargo to other gateways. Also, historically, environmental regulations initiated in California often migrate to other regions of the United States.

The South Coast Air Quality Management District (AQMD) during the weekend approved a proposal to begin developing “indirect source rules (ISRs),” which are clean-air regulations governing freight movements that the facilities generate, but do not directly control. The AQMD is expected to develop the indirect source rules in the coming year.

Talk of establishing ISRs has been ongoing for the past three years, said Thomas Jelenic, vice president of the Pacific Merchant Shipping Association, which represents shipping lines and terminal operators on the West Coast. Therefore, Friday’s action by the AQMD did not catch the freight industry by surprise. However, given the synergy involving port-generated truck moves to import distribution centers and railyards, movements between import distribution centers and regional warehouses, and now e-commerce fulfillment, BCOs and transportation providers fear a regulation impacting one segment of the supply chain will impact others as well.

Jelenic demonstrated this point by noting that a large Southern California harbor trucking company may generate only 50 percent of its business in the harbor, with the remaining traffic moving between warehouses or other facilities in the region.

Southern California — largest freight region in US

With more than 1.5 billion square feet of industrial real estate, the four-county Southern California region generates more freight movement than any region in the United States. This cargo is moved by trucks, mostly diesel trucks, and intermodal rail. The goal of local and state regulatory agencies is to progress toward zero-emission trucks, which by definition means battery-powered electric vehicles. The problem facing the transportation industry is that zero-emission trucks are not yet commercially available in the heavy-duty sector.

The ports have addressed this issue by setting future guidelines for achieving zero emissions. The 2017 update to the ports’ Clean Air Action Plan calls for a zero-emission harbor trucking fleet by 2035. The California Air Resources Board (CARB)'s clean-diesel rules for heavy-duty trucks are less stringent than the ports’ regulations and do not yet set a zero-emission goal.

This patchwork of requirements is of concern to the freight-movement industry for two reasons. Requirements for trucks that call at the ports are different than those involving warehouse-to-warehouse moves, yet many drayage companies participate in both markets. Also, different agencies are involved in the rule-making process, with AQMD regulating stationary sources (warehouses) and CARB regulating mobile-source movements. “There is no assurance AQMD requirements will be consistent with port requirements,” Jelenic said.

The AQMD proposal for ISRs is of great concern to the transportation sector because warehouses, distribution centers, and intermodal rail yards have no direct control over the trucks calling at those facilities. “Under the ISR logic, a warehouse in the Inland Empire would be responsible for the trucks picking up and dropping off freight. This would be similar to a grocery store telling its customers what kind of car they could use on a shopping trip,” Jelenic stated in a recent commentary.

On the other hand, speakers at a clean cargo-handling and trucking summit Thursday in Long Beach noted that heavy-duty truck makers and manufacturers of cargo-handling equipment are testing or preparing to test zero-emission units in the harbor environment. “Zero-emission technologies are rapidly becoming market available,” said Bill Robertson, vehicle program specialist at CARB.

Developing zero-emission vehicles for marine-terminal work, such as yard tractors, is further along than for over-the-road, heavy-duty trucking. Manufacturers of yard tractors told the summit they are confident the vehicles will be able to operate for two consecutive eight-hour shifts and then fully recharge during the night shift.

Inland Empire: lacks zero-emission infrastructure

The work cycle for heavy-duty trucks serving the Inland Empire, 50 miles east of Los Angeles or beyond, is more challenging. Even if the technology were readily available to make such vehicles operationally and commercially viable, the charging infrastructure is not. “The challenge for infrastructure is, we don’t have it,” said Heather Tomley, director of environmental planning at the Port of Long Beach. However, the ports have experience in providing infrastructure within their gates because the 12 container terminals in Los Angeles-Long Beach have been providing electric power for ocean-going vessels at berth since 2014.  

The ports’ clean-truck programs proved that a massive shift from old, polluting diesel trucks to clean diesel vehicles with 2007 or newer engines was possible, as more than 10,000 trucks were replaced by 2012, four years after the effort was launched. Those programs reduced truck emissions by more than 90 percent. The revised CAAP calls for tightening the emissions requirements until zero-emission vehicles become commercially available.

However, with hundreds of warehouses and distribution centers in Southern California, replicating the ports’ clean-trucks programs will be more difficult, especially if AQMD adopts zero-emission requirements, a question that is yet to be answered. Jelenic said that given the current truck capacity and driver shortage problems throughout the United States, the imposition of ISRs for warehouses, distribution centers, and railyards come at a most difficult time for the freight transportation industry in Southern California.

Contact Bill Mongelluzzo at bill.mongelluzzo@ihsmarkit.com and follow him on Twitter: @billmongelluzzo.

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