LSI emission regulations still loom, but lack bite.
In 2001, the California Air Resources Board (CARB) passed regulations governing the emissions on Large- Spark Ignition (LSI) engines—the same engines used in most IC lift trucks. The regulations use a fleet average emission level standard to measure a company’s compliance. Older lift trucks could receive values of up to 16.0 grams per kilowatt-hour each—and a fleet’s average needs to be 4.0 or lower depending on fleet size and applicable exemptions.
These regulations presented both opportunity and potential hardship for lift truck dealers in California. There were going to be quite a few end-users in the area who would need either new equipment or retrofit kits to become compliant, which meant potential business for us. However, there was also the issue of our rental fleets. The way the legislation was written, if we rented a non-compliant forklift, it could result in a fine for our customer. That’s obviously a risk we didn’t want to take.
Making Ourselves Heard
When the regulations first passed, our company, Gray Lift, had concerns about what they might mean for our fleet of older rental equipment. If the regulation stood as it was, a great deal of our short-term rental equipment that was non-compliant would become virtually worthless in the state of California.
As it turned out, we weren’t the only ones who were concerned. In response, Gray Lift, along with fellow MHEDA member J.M. Equipment Company and several other material handling dealers, joined an organization called the Far West Equipment Dealers Association. We all pooled our money together, many of us digging into our own pockets, and hired a lobbyist to represent our interests in Sacramento.
The move paid off and we were able to get several changes made to the bill. Our lobbying efforts convinced the state legislature to exempt businesses with three or fewer lift trucks from the bill. This was an absolutely huge deal for us because it meant that we still had an outlet for our older, non-compliant equipment.
More Bark Than Bite
Now, eight years after the bill was first passed, there has yet to be a dramatic impact. That’s not to say that there hasn’t been any movement. There has been a definite increase in electric truck sales and, of course, a corresponding drop in propane truck sales. We’re also seeing some of the single-shift or half-shift end-users buy new instead of used because the used equipment won’t help them meet their CARB goals. We’ve been offering free evaluations and we’ve had some takers, but it’s nothing like you would expect. The amount of retrofitting that we have done isn’t very significant.
The problem is, thus far, these regulations lack bite. Initially fines for non-compliance were scheduled to go into effect on January 1, 2009, and then that deadline was pushed back until April 1, 2009. Now it’s December and we have yet to hear of a single fine. Part of that may be that the government is backing off because of the economy. California in particular has had a rough time this year.
What it comes down to is, right now, everybody is hanging on to every single penny that they’ve got. If the government isn’t fining anybody, they’re in no rush to comply. Eventually, you would have to imagine that the fines will start to occur. Then, we’re expecting a positive impact on the sales side. However, until then, all we can do is keep moving forward and be prepared to help our customers once the fines start to come.