CARB Approves Advanced Clean Fleets Regulation
May 8, 2023
On April 28, the California Air Resources Board (CARB) passed the Advanced Clean Fleets Regulation (ACF), a medium and heavy-duty zero-emission fleet regulation with the goal of achieving a zero-emission truck and bus California fleet by 2045 everywhere feasible and significantly earlier for certain market segments, such as last mile delivery and drayage applications. The regulation applies to fleets performing drayage operations, those owned by State, local, and federal government agencies, and high priority fleets. High priority fleets are entities that own, operate, or direct at least one vehicle in California, and that have either $50 million or more in gross annual revenues, or that own, operate, or have common ownership or control of a total of 50 or more vehicles (excluding light-duty package delivery vehicles). The regulation affects medium- and heavy-duty on-road vehicles with a gross vehicle weight rating (GVWR) greater than 8,500 pounds, off-road yard tractors, and light-duty mail and package delivery vehicles.

  • Manufacturer sales mandate. Manufacturers may sell only zero-emission medium- and heavy-duty vehicles starting in 2036.

  • State and local agencies. State and local government fleets, including city, county, district, and State agency fleets, would be required to ensure 50 percent of vehicle purchases are zero-emission or near zero-emission vehicles (NZEV) beginning in 2024-2026 and 100 percent of vehicle purchases are zero-emission or NZEV by 2027.
  • Fleets of 10 or less: Divisions that have 10 or fewer vehicles, or agencies that are in certain designated counties will remain exempt from the zero-emission vehicle (ZEV) purchase requirement until 2027.
  • ZEV Milestone Phase-In Option: State and local governments are now able to use the optional ZEV milestone phase-in option that provides flexibility for fleets to prioritize the phase-in of ZEVs based on suitability.
  • Near Zero-Emission Vehicles (NZEVs): State and local government fleets may now count NZEVs the same as ZEVs, for the purposes of determining compliance, until 2035. An NZEV is defined as a plug-in hybrid vehicle with a minimum all-electric range.
 
  • Drayage fleets. For drayage fleets, starting in 2024, only zero-emission trucks may be added to drayage service, and legacy vehicles must be removed from drayage service at the end of their useful life. By 2035, all drayage trucks must be zero-emission. This applies to Class 7-8 on-road trucks operating at California’s seaports and intermodal railyards.

  • High priority and federal fleets. High priority and federal fleets must comply with a Model Year Schedule or may elect to use the optional ZEV Milestone Schedule to phase-in ZEVs into their fleets:
  • Model Year Schedule: Fleets must purchase only ZEVs or NZEVs beginning 2024 and must remove internal combustion engine vehicles at the end of their useful life as defined in Senate Bill 1 (Beall, Statutes 2017, Chapter 5).
  • “Minimum useful life” means the minimum time period a vehicle may remain in the California fleet. It is the latter of the dates specified below:
  • 13 years commencing from the model year the engine and emissions control system in a vehicle was first certified for use by CARB or U.S. EPA; or
  • The date the vehicle exceeded 800,000 vehicle miles traveled or 18 years from the model year that the engine and emissions control system of that vehicle was first certified for use by CARB or U.S. EPA (whichever is earlier).
  • If the vehicle no longer has its originally equipped engine, or the model year of the originally equipped engine is not able to be determined, the model year of the vehicle less one year must be used to determine when the thresholds are met as described in the subsections above.
  • ZEV Milestone Schedule (Optional): Instead of the Model Year Schedule, fleets may elect to meet ZEV targets as a percentage of the total fleet starting with vehicle types that are most suitable for electrification.
Exemptions & Extensions
 
  • Five-Day Pass: This provision allows for temporary operation of a vehicle in California without affecting compliance. The fleet owner would be able to claim the pass online by submitting information about the vehicle and when the 5-day exemption would begin. The pass would only be issued once per year for each vehicle. (Applies to: High Priority Fleets)

  • Waste and Wastewater Fleets Provisions: This provision provides more time for certain vehicles in waste and wastewater fleets who are implementing organic waste diversion programs and exclusively fueling eligible vehicles with biomethane. This provision would defer ZEV requirements until 2030 for eligible fleets who elect to comply with the ZEV Milestone option. (Applies to: High Priority Fleets and State and Local Governments)

  • Accident/Non-Repairable Vehicle Provision: This provision allows for the purchase of another used internal combustion engine (ICE) vehicle with the same or newer model year engine as the vehicle that was rendered non- repairable due to a one-time event like a fire or accident without affecting the compliance date associated with the vehicle that was deemed to be non-repairable. (Applies to: Drayage Trucks, High Priority Fleets using the Model Year Schedule and State and Local Governments)

  • Intermittent Snow Removal Vehicle Exemption: In the original proposal, dedicated snow removal vehicles were already exempt from the ACF regulation. This provision would provide a temporary exemption for intermittent snow removal vehicles to exclude them from the ZEV requirements until 2030. Intermittent snow removal vehicles are trucks that operate as a snowplow part of the year and other uses when there is no snow to plow. (Applies to: State and Local Governments and High Priority Fleets)

  • Transit Fleet Exemption: This provision temporarily excludes transit agencies subject to the Innovative Clean Transit regulation until 2030. This provides more time before ZEV purchases begin for their maintenance and support vehicles allowing them to focus their efforts on electrifying their transit buses first. (Applies to: State and Local Governments)

  • ZEV Purchase Exemption: This provision allows fleets to delay adding certain vehicles to the fleet if they are not yet available and would now include two options to use the exemption. (Applies to: State and Local Governments and High Priority Fleets)
  • The prior proposal would require that CARB maintain a list of what vehicles can be purchased as an ICE vehicle if ZEVs are not available to purchase in given configuration type. Fleet owners would not need to apply for an exemption for vehicles on the list and would report the purchase when the vehicle is received.
  • Fleet-specific exemption. In addition to vehicles on the list, a fleet owner may apply for an exemption if the ZEV cannot be configured to meet the primary intended function the fleet owner needs. For example, this would cover cases where the fleet needs a truck upfit with a bucket truck body with 100 ft. of reach and ZEVs are only available in a configuration with a 50 ft. reach. CARB will verify no manufacturers can produce and sell the configuration and shall issue the exemption within 45 days.
  • Fleet protections. Additional modifications were made to include more fleet owner protections when assessing what ZEV configurations are considered to be available. For example, a newly added requirement for a ZEV to be considered available is that it will have to meet the Zero- Emission Powertrain certification requirements, it cannot be a demonstration vehicle, and it must be available to purchase within the next two model years.
  • Exemption coverage. This exemption was also expanded to apply to all vehicle weight classes instead of just heavier trucks. This exemption does not apply to drayage trucks because there are multiple tractor models already available.

  • Daily Usage Exemption: This provision allows fleet owners to apply for an exemption to purchase an ICE vehicle if ZEVs are available in a given configuration, but do not meet the fleet’s daily mileage and stationary operational use needs. (Applies to: State and Local Governments and High Priority Fleets)
  • Miles and operations. Fleet owners would need to submit information to CARB about the daily mileage (or usage) of existing vehicles in the fleet to show that available ZEV could not be placed in the fleet to meet daily needs based on miles and hours of operation in a 30-day period within the prior year. Fleets with mutual aid agreements would also be able to use data from the prior 5 years.
  • The provision was also expanded to give fleet owners the ability to use operational data to compare with fleets that operate ZEVs in a similar application and by shortening the time period fleets would need to collect vehicle data to support a fleet’s exemption request.

  • Infrastructure Delay: This provision allows fleet owners to receive an extension if the installation of infrastructure at their site was delayed for reasons outside of their control and they took steps to start the project one-year ahead of the next compliance date. The provision was expanded in several ways to address construction delays and utility delays. (Applies to: State and Local Governments, Drayage Trucks, and High Priority Fleets)
  • Construction delays. Unexpected delays after construction started would qualify for an extension for up to two years instead of one and would include delays associated with ZEV infrastructure equipment (e.g., charger and hydrogen dispensing equipment).
  • Utility delays. Site electrification delays by the utility could be used to support extensions for an initial 3- year period and an additional 2-year extension based on the utilities ability to provide sufficient power to the site and based on how many ZEVs can be supported each year.

  • Zero-Emission Vehicle Delivery Delay: This provision accounts for delays in receiving a ZEV that has been ordered one year ahead of the compliance date for reasons outside of their control. The extension could be claimed during annual reporting by showing proof of the ZEV purchase. (Applies to: High Priority Fleets and Drayage Trucks)
  • This provision was modified to provide clarification of the process and requirements to request an extension for the vehicle delivery delay. The modified language clarifies the unique types of documentation required for vehicle purchases and leases that will be utilized for extension applications.
  • A provision was added to allow for the extension to be renewed if a manufacturer cancels a purchase agreement and the applicant submits documentation of a new zero-emission vehicle purchase agreement within 365 days for government fleet owners, or 180 calendar days for other High Priority Fleets and drayage trucks.

  • Mutual Aid Exemption: Fleets that have mutual aid agreements (e.g., public fleets and utilities) would be able to purchase ICE vehicles for up to 25 percent of their fleet. Access to this option was improved by reducing the ZEV threshold before a fleet owner could claim the exemption to purchase ICE vehicles and the provision was expanded to allow for ICE vehicle purchases in all vehicle weight classes. The ZEV threshold was reduced from 75 percent ZEVs to a phased in threshold where fleet owners would become eligible if exceeding 25 percent ZEVs until 2032, 50 percent until 2035, and 75 percent thereafter. (Applies to: State and Local Governments and High Priority Fleets)

As part of the vote, board members directed staff to coordinate with relevant state agencies on how non-fossil biomethane from sources related to the state’s wastewater and food waste diversion requirements under SB 1383 can be used in hard- to-decarbonize sectors as part of the transition, and to report to the Board, by the end of 2025, any actions needed to accomplish the transition.

The approved resolution also includes a progress check-in on the implementation of the regulation in 2028, but many opponents believe the adjustments included didn’t accommodate any of industry’s substantial concerns.

As California transitions to zero-emission, incentive funding, infrastructure feasibility and ZEV availability will continue to be of utmost importance in the success of the ACF and similar zero-emission regulations.
 
For more information, please visit CARB’s website by clicking here. For any questions, please contact Taylor Roschen at troschen@kscsacramento.com.
Kahn, Soares & Conway, LLP provides the foregoing for informational purposes only and it is not intended as legal advice. Using this information or sending electronic mail to Kahn, Soares & Conway, LLP or its attorneys does not create an attorney-client relationship.