The Long-Term Challenge of Alt-fuel at the Ports of Los Angeles and Long Beach

In 2006 the Ports of Los Angeles and Long Beach announced their Clean Trucks Programs – an initiative with a short-term overriding purpose of reducing pollution from the 16,800 heavy-duty port drayage trucks by approximately 80% over five years. The Los Angeles program also included provisions to create long-term sustainability by creating a systemic change in the structure of the port drayage industry that has been characterized by poverty level wages and old polluting and unsafe trucks. The other vital long-term purpose of the Clean Trucks Programs is to catalyze a shift away from diesel dependence towards alternative-fuels such as Liquefied Natural Gas (LNG) and electric trucks that presently hold the most promise in fighting air pollution and climate change. Due to the recession and legal challenges to the Clean Trucks Program the alternative-fuels component of the Clean Trucks Program has been significantly scaled back over the past year highlighting the need for a long-term plan to achieve an environmentally sustainable port trucking fleet.

With the adoption of the Clean Trucks Program both ports committed to replacing half the fleet with alternative-fueled trucks. If this had been achieved manufacturers likely would have achieved the economies of scale that would have brought the price of alternative-fueled trucks - at this point mainly LNG - in line with the price of a new 2007 diesel truck. In addition LNG fuel prices have trended historically lower than diesel making the long-term costs of an LNG truck particularly attractive. Environmentally they provide significant reductions in climate changing gases as well as reductions in NOx emissions. Electric trucks are the other option in the port drayage market; however, at this point their limited range and limited supporting infrastructure maintain them as an option to be cultivated in the next few years rather than ready for mass production and penetration right now. Their eventual upside is significant as the potential exists for them to run on electricity powered by 100% green power. The best option then seems to be promoting the aggressive roll-out of LNG trucks while continuing to improve the capabilities of the electric trucks so that they will be competitive in the next several years.

Unfortunately two factors intervened in the Clean Trucks Program to hinder the deployment of alt-fuel trucks: the economy and legal challenges. In 2008 as the economy began its rapid descent cargo volumes dropped at the same time diesel fuel prices dropped off a cliff. Presently cargo volumes at the Ports of Los Angeles and Long Beach are down about 40% over a year ago. The reduction in cargo volume has significantly affected the bottom line of the ports. It has also ensured that the $35 fee on each twenty foot container has brought in much less revenue than expected. And since it was primarily the combination of general fund revenue and container fee revenue that was earmarked for subsidizing new alternative-fuel trucks there is much less capital available to deploy a significant amount of these trucks. While diesel fuel prices will again rise once the economy recovers for now they are low so LNG fuel is not nearly as attractive as a cost-saving measure.

Finally the legal challenges, with specific emphasis on the case brought by the Federal Maritime Commission (FMC), have wasted the financial resources of the ports. The FMC delayed the collection of the container fee from October of 2008 until February of 2009 preventing the collection of tens of millions of dollars for subsidizing alt-fuel trucks. The other case brought by the American Trucking Association (ATA) has resulted in millions of dollars in legal fees and threatens the long-term sustainability of the port drayage fleet because it will ensure that drivers who earn poverty-level wages will be responsible for the transition to alt-fuel while large trucking companies continue to earn large profits.

This whole process will result in less than 1,000 alt-fuel trucks being deployed between both ports, and highlights the need for a long-term strategy to kick the diesel habit. For all effective purposes the Clean Trucks Program will end in January of 2010, but the work to integrate alt-fuels will need to continue. Alt-fuel trucks represent the most viable option for reducing both air quality pollutants and climate changing gases from the trucking fleet at the Ports of Los Angeles and Long Beach. While the ports should be applauded for the success in turning over the trucking fleet from an extremely dirty fleet to a cleaner fleet there should be no equivocation that diesel is an inherently dirty fuel that costs thousands of people their lives and billions of dollars in health cost every single year. Alt-fuel trucks can eliminate this threat and play a vital role in combating climate change. The port drayage truck fleet will finally become a sustainable system when it is composed of the cleanest available trucks and staffed by drivers that are paid good wages, receive good benefits, and the dignity they deserve. It is time for the ports to work with decisionmakers and the environmental, public health, and labor communities to ensure that this comes to pass.