BOARD MEETING DATE: November 7, 2003
AGENDA NO. 4

Execute Contract to Cosponsor Development and Demonstration of 8.1-liter Natural Gas Engine in Medium-Duty Trucks

SYNOPSIS:

The National Renewable Energy Laboratory (NREL) issued an RFP in April 2002 to cosponsor the Phase II development of the Next Generation of Natural Gas Vehicles (NGNGV) in conjunction with funding from the U.S. Department of Energy. NREL selected a proposed project from TeleflexGFI for support. The proposed contract with TeleflexGFI will develop and demonstrate an 8.1-liter natural-gas engine in a heavy-duty commercial chassis. Staff recommends cofunding this project with NREL for a total project cost of $2,191,829, with AQMD funding not to exceed $334,080 from the Clean Fuels Fund.

COMMITTEE:

Technology, October 24, 2003, Recommended for Approval

RECOMMENDED ACTION:

Authorize the Chairman to execute a contract with TeleflexGFI Control Systems, Inc., to cofund the development and demonstration of an 8.1-liter natural gas engine in medium-duty trucks at a cost not to exceed $334,080 from the Clean Fuels Fund.

Barry R. Wallerstein, D.Env.
Executive Officer

Background

The majority of medium- and heavy-duty trucks and buses in the South Coast Air Basin are powered by diesel engines that contribute significant emissions of NO_x and particulate matter. The AQMD has long recognized the adverse air quality and health impacts of diesel exhaust and has adopted several measures to promote the use of low-emission natural-gas vehicles.

NREL has created a program called the "Next Generation of Natural Gas Vehicles" (NGNGV). The purpose of this program is to develop a new medium-duty (Class 3-6) compressed natural gas (CNG) vehicle and a new heavy-duty (Class 7-8) liquefied natural gas (LNG) vehicle for commercialization starting in 2004. These new natural gas vehicles must have NOx emissions at or below 0.5 g/bhp-hr and PM emissions at or below 0.01 g/bhp-hr. For the 2007 timeframe, NO_x emissions must be at 0.2 g/bhp-hr to meet U.S. EPA’s emission standards. Such vehicles will represent a step-change in natural gas vehicle technology.

NREL has initiated two phases of NGNGV research. Out of the Phase I solicitation, seven projects were recommended for funding, with NREL funding four of the projects. In September 2001, the Board approved funding for the remaining three NGNGV Phase-I projects, two with Cummins Westport and one with GFI Control Systems (now TeleflexGFI Control Systems). The two Cummins Westport projects are coming to an end this year, while the GFI project has recently concluded.

The second phase NGNGV solicitation selected four projects for funding. Last January, the Board approved funding for two of these projects, one with Cummins and one with Mack. These two AQMD-cosponsored projects are now underway. NREL also intended to fund the two other projects. NREL has selected TeleflexGFI Control Systems to develop a 8.1-liter natural gas engine and demonstrate it in a low-floor bus. However, NREL does not have sufficient funding to demonstrate this engine in medium-duty trucks. Such natural-gas truck models are needed to support the AQMD’s fleet rules. Staff is recommending that the AQMD cosponsor, along with NREL, this project with TeleflexGFI.

Proposal

TeleflexGFI proposes to develop the General Motors (GM) 8.1-liter engine to operate on natural gas and demonstrate it in two different medium-duty applications. This development effort will extend the technology developed under the previous AQMD TeleflexGFI Phase I project from the GM 6.0-liter engine to the GM 8.1-liter engine.

This new project consists of four tasks. Task 1 consists of the development of the 8.1-liter engine from a gasoline to a natural-gas engine. In Task 2, the new natural-gas engine and fuel system will be integrated into a medium-duty commercial chassis. From this chassis, a medium-duty truck and low-floor bus will be developed. These vehicles will then be demonstrated under Task 3, with up to two medium-duty trucks being demonstrated in the South Coast Air Basin. The final task involves engine emissions certification to 0.2 g/bhp-hr NO_x.

Sole Source Justification

In the "Procurement Policy and Procedure" document, Section VIII outlines the provisions for awarding a sole source contract. Specifically, under item B.2.d., "Other circumstances exist which in the determination of the Executive Officer require such waiver in the best interests of the AQMD," namely (1) "Projects involving cost sharing by multiple sponsors". The proposed contract was selected through a competitive RFP process conducted by NREL with AQMD participation, and this proposal provides significant cost sharing.

Benefits to AQMD

The proposed project is included in the March 2003 update of the Technology Advancement Plan under project 2003CFM4-2, "Develop and Demonstrate Next Generation Natural Gas Vehicles." The AQMD clean fleet vehicle rules rely on the expedited implementation of advanced technologies in Southern California to achieve air quality standards and continue reduction in air toxic exposure.

The AQMD has been proactive in developing and demonstrating low-emission, medium- and heavy-duty, natural gas vehicles. These projects will provide improved air quality by reducing the NO_x and particulate emissions from these vehicles, while also reducing the CO₂ greenhouse gas emission.

Resource Impacts

The total estimated cost for the proposed project is $2,191,829. AQMD’s contribution from the Clean Fuels Fund shall not exceed $334,080. NREL will contribute $1,271,970, TeleflexGFI $301,579, ARBOC Ltd. $138,000, General Motors $72,500 and Engelhard $73,700.

Sufficient funds are available from the Clean Fuels Fund, established as a special revenue fund resulting from the state-mandated Clean Fuels Program. The Clean Fuels Program, under Health and Safety Code Sections 40448.5 and 40512 and Vehicle Code Section 9250.11, establishes mechanisms to collect revenues from mobile sources to support projects to increase the utilization of clean fuels, including the development of the necessary advanced enabling technologies. Funds collected from motor vehicles are restricted, by statute, to be used for projects and program activities related to mobile sources that support the objectives of the Clean Fuels Program.

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