The air-quality legislation in California is having an impact. What does it mean for distributors?
The push to “go green” over the last several years has had a definite impact on the material handling industry. As companies look to become more energy-efficient, material handling companies are stepping in to bring customers greener solutions.
Such initiatives are in place around the country, but perhaps no state is being more impacted than California. In 2006, the California Air Resources Board (CARB), the state’s oversight group for air pollution, implemented a regulation limiting the amount of emissions produced by Large Spark-Ignition (LSI) engines of more than 25 horsepower, including those that power forklifts. As part of that rule, “fleet-average” standards were implemented as of January 1, 2009, with stricter standards to be enforced in 2011 and stricter still in 2013.
End-users must meet fleet-average standards by retrofitting older units or by purchasing electric units or cleaner spark-ignition units as their fleets are replaced. The extent to which end-users need to accelerate their fleet turnover or incorporate more electric units varies from user to user. The regulation includes procedures for manufacturers to voluntarily certify engines at lower emission levels and for manufacturers of retrofit kits to obtain CARB “verification” of the emissions-reducing capabilities of their technologies.
Impact for Distributors
The MHEDA Journal spoke with four MHEDA distributors about how these regulations have impacted their businesses in the first year of implementation. Although the rules have been written for several years, distributors still have concerns about their clarity. “They’re very complicated and confusing. If you ask 10 different people, they’ll give you 10 different answers as to what the rules and regulations are,” says Mark Maechling, president of Cal-Lift (City of Industry, CA).
David Griffin, vice president of operations at K-Lift Service Company (Salinas, CA), agrees, saying, “The rules are pretty ambiguous, and there are still some gray areas that haven’t been interpreted yet. I think that puts a little bit of fear in the back of customers’ heads.”
To allay those fears, distributors should educate their customers about the regulations and the consequences for non-compliance. The hope is that the drive for compliance will encourage customers to purchase new equipment, though distributors say results are mixed so far. Jay Waugh, president of Gray Lift (Fresno, CA), says, “When customers do replace equipment, they tend to go more electric now. We’ve seen a drop in our used equipment sales with those that have fleets of four or more trucks because they’ve got to buy late-model units to comply.”
Maechling goes as far to say, “The CARB rules are driving a lot of business out of California. Companies are faced with significant downturns in business and then are forced to replace their equipment on top of that. Many are deciding that it’s far cheaper to move someplace else.”
This is the case even though enforcement has not yet been consistent. According to Waugh, retrofitting has not yet taken off and won’t until the laws are enforced more regularly. “Until CARB starts imposing more fines, people will lie in the weeds. Right now, they don’t want to spend any money to retrofit their older lifts,” he says.
It’s not just those in California who should be paying attention, says Patrick Stemper, vice president/general manager of Badger ToyotaLift (New Berlin, WI). “We have customers here in Wisconsin with plants or branches in California and that has really become a focus for them,” Stemper says. “EPA basically follows CARB’s lead, so it’s only a matter of time before those regulations are in place in some form throughout the country.”
Early signs say the regulations are having an impact, though time will tell how much and how soon. Until then, lift truck distributors should pay close attention to what’s happening in California; your state may be next!