CA Fines Shippers for Air Violations

By Mark Edward Nero

The California Air Resources Board said Jan. 13 that it has fined four shipping companies a combined $146,719 for failing to switch from dirty diesel “bunker” fuel to cleaner, low-sulfur marine distillate fuel upon entering regulated California waters, within 24 nautical miles of the coast.

The four companies were fined for either failing to switch to cleaner fuel within, regulated waters, or for switching fuels in an untimely manner. However, they all took prompt action after being notified of the violations, according to the air board. The companies are:

Wealth Ocean Ship Management Co., Ltd. of China, which was fined $27,750 for violations by the vessel Uni Auc One.

China Shipping Container Lines, which was fined $35,719 for violations by the vessel Xin Mei Zhou.

Liberty One Ship Management of Germany, which was fined $53,000 for violations by the vessel BBC Arizona.

Kitaura Kaiun Co., Ltd. of Japan, which was fined $30,250 for violations by the vessel Ocean Seagull.

“State anti-pollution laws require shippers to do their part to protect air quality,” ARB Enforcement Chief Jim Ryden said.

CARB’s Ocean-Going Vessels Fuel Rule, which was adopted in 2008, was designed to reduce fine particulate pollution, oxides of nitrogen and sulfur oxide emissions from ocean-going vessels to improve air quality and public health in California.

“Our Ocean-Going Vessels Fuel Rule strives to protect residents throughout the state from the harmful impacts of ship pollution,” Ryden said.

California Seeks to Expand Low-Sulfur Fuel Zone Along Coast

California air regulators have put forward their plan to stop cargo vessels from avoiding the main coastal shipping route between the Channel Islands and the Santa Barbara/Ventura coast and skirting through a US Navy missile range on the west side of the Channel Islands.

Captains are taking the outer route to avoid a California Air Resources Board regulation requiring vessels within 24-miles of the coast to burn more expensive low-sulfur fuel. The Navy reports a nearly seven-fold increase in the number of vessels using the outer route and transiting through the Pt. Mugu Sea Range. The range sits mainly in international waters outside of the 24-mile CARB limit. The vessel traffic is a safety concern to the Navy, which conducts test almost every day of the year at the range, and raises the potential for disrupting missile tests.
CARB also said that the vessels taking the outer route are impacting anticipated emission reductions that were predicted to be achieved by the regulations.

CARB is now proposing to extend the 24-mile zone from the Channel Islands instead of the coast, thus placing the outer route through the missile range within the low-sulfur fuel zone. To give vessels incentive to take the coastal route, the proposed plan would also create a "window" in the northern approach area that would not be subject to the low-sulfur regulation.

The main goal of the proposed plan, according to CARB, is to recapture the emission reductions being lost as vessels take the outer route through the missile range, and to reduce traffic moving through the missile range. CARB believes that expanding the 24-mile low-sulfur zone to fully encompass the outer route will eliminate the economic incentive for vessels to deviate from the main shipping routes along the coast.

CARB estimates that vessels using the outer router typically save about $3,000 in fuel costs but experience an extra hour of transit time. By taking advantage of the northern approach "window" and using the main shipping route along the coast, CARB estimates that vessels could save $400 or more on fuel costs and shave their transit time by an hour.

Currently, about 50 percent of the vessels heading to the Southern California ports of Long Beach and Los Angeles utilize the Channel Island routes.
CARB will be holding an additional workshop on the proposal early next year. A decision is not likely until at least March, when the CARB board is set to discuss the issue.

Truckers, Refiners Sue Over California Low-Carbon Fuel Regulation

The American Trucking Association, which represents more than 37,000 motor carriers nationwide, and a coalition of petroleum industry trade groups filed suit Tuesday in federal court to block California's recently enacted low-carbon fuel standard.

The regulation, implemented by the California Air Resource Board on Jan. 12, requires annual reductions over the next decade in the carbon intensity of gasoline and diesel produced for use in California. The goal of the regulation, according to CARB, is to reduce greenhouse gas emissions. Large-scale use of lower-carbon transportation fuels, said CARB in drafting the LCFS, is necessary to meet a state requirement that greenhouse gases generated in the state be reduced to 1990 levels by 2020.

During his 2007 State of the State address, California Gov. Arnold Schwarzenegger called for implementation of an LCFS. In April 2009, CARB formally adopted a regulation implementing such a standard, but the regulation did not become effective until it was approved in January of this year by the state’s administrative law office.

Supporters of the regulation have argued that in addition to reducing greenhouse gases by 16 million tons by 2020, the LCFS will diversify transportation fuels in the state and increase demand for alternative-fueled vehicles. 

“The drive to force the market toward greater use of alternative fuels will be a boon to the state’s economy and public health,” CARB Chairwoman Mary D. Nichols said early last year. “It reduces air pollution, creates new jobs, and continues California’s leadership against global warming.” 

The ATA suit alleges that the LCFS regulation will unduly burden fuel providers and add increased costs to fuel consumers without any net change in fuel's carbon-intensity on a global scale. The end result, claims the suit, is no reduction – and a likely increase – in greenhouse gas emissions.

“The LCFS would essentially ban imports to California of fuels derived from unconventional sources such as oil sands from Canada, oil shale from the Western US, or domestic coal supplies that can be converted into transportation fuels,” said ATA Vice President Rich Moskowitz. “Discouraging these fuels will simply increase costs while failing to prevent their export to and consumption by other nations.”

The suit relies in large part on the federal preemption argument used successfully in the past by the trucking industry when opposing local and state regulations– namely that federal law supersedes local or state regulations in dealing with interstate commerce.

“The California LCFS is unlawful for a number of reasons, including the fact that it violates the Commerce Clause of the US Constitution by imposing undue and unconstitutional mandates on interstate commerce,” explained NPRA Pres. Charles T. Drevna. 

The suit also asserts that the CARB regulations discriminate in favor of California-produced fuels by assigning them lower carbon-intensity ratings because of shorter transportation distances to users. 

Filed in United States District Court in California, the suit also includes the Center for North American Energy Security, Consumer Energy Alliance and the National Petrochemical and Refiners Association as plaintiffs with the ATA.