texas emissions reduction plan (terp) -...

Air Quality Division • www.terpgrants.org • 800-919-TERP (8377)

Texas Emissions Reduction Plan

Air Quality Division •

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Image of TERP Logo


TERP Program

What we do:Provide financial incentives to upgrade or replace older heavy-duty vehicles, non-road equipment, locomotives, marine vessels, and stationary equipment

Why we do it:To reduce nitrogen oxide (NOx ) emissions in nonattainment and near- nonattainment areas.

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Image illustrating NOx + VOC = Ozone


NOx Sources

NOx emissions are the result of the combustion process

Cars, trucks, boats, trains

Industrial smokestacks

Electric power generation

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Image of polluting truck


TERP Program

NOX emissions combine with volatile organic compounds (VOC) in the presence of sunlight to form ground level ozone (smog)

NOX + VOC + Ozone

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Image illustrating NOx + VOC = Ozone


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Map of TERP eligible counties


Types of Projects

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Images of TERP projects: truck, boat, locomotive, ag tractor, school bus and excavator


The TERP Process

OutreachContract

Development

Fiscal

ApplicationReview

Disposition

Monitoring &Usage


TERP Grants Awarded

Emission Source

Number of

ProjectsGrant Amount

Total Tons of NOX

Reduced

Total 5,714 $745,718,747 156,920

Locomotive 36 $182,834,092 57,630

Marine 84 $47,907,997 14,954

Non-road 2,707 $235,241,596 35,991

On-road 2,841 $267,552,125 44,313

Stationary 46 $12,182,935 4,031

As of July 2009


Grant Programs


TERP Grant Programs

Emissions Reduction Incentive Grants (ERIG)• Approximately $80 million per fiscal year• Competitive process• Funding determined by various factors using a

calculator

Rebate Grants Program• Approximately $30 million per fiscal year• First-come, first-served (non-competitive)• Funding determined by the Rebate Tables

(default factors used)


Eligible Applicants

Persons that own or operate eligible vehicles and equipment in the eligible counties• Individuals• Businesses• Districts• Non-profits• Government entities


General Requirements

Horsepower (HP) and Gross Vehicle Weight Ratings (GVWR):• On-Road Vehicles must have a GVWR of 8,500

pounds or higher

• Non-Road, Marine, and Stationary Equipment engines must have a HP rating of 25 or higher

• Locomotives will be over 1,000 HP


EMISSIONS REDUCTION INCENTIVE GRANTS (ERIG)

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Image of TERP Logo


Eligible Emission Sources

On-road heavy-duty vehicles

Non-Road heavy-duty equipment

Stationary engines

Locomotives

Marine vessels


Eligible Project Categories

New purchases and leases (fleet expansion)

Replacement of old vehicles and equipment with newer models

Repower existing vehicles and equipment (engine replacement)

Retrofit and add-on devices on vehicles and equipment (EPA or CARB certified/verified)

On-site and on-vehicle infrastructure for idle-reduction or electrification systems, and qualifying fuel infrastructure

Rail Relocation and Improvement


New Purchase or Lease

Purchase or lease of brand new vehicle or equipment (fleet expansion)

New engine must be certified to emit at least 25% less NOx than the federal emission standard applicable to that engine

The grant may pay up to the difference in cost between the cleaner vehicle/equipment and a comparable model/make that only meets the standard

The availability of vehicles and equipment meeting this eligibility standard is very limited


Replacements

Purchase or lease of a new or newer vehicle or equipment to replace an existing vehicle or equipment

New engine must be certified to emit at least 25% less NOx than the engine being replaced

The old vehicle/equipment must have been owned and operated in Texas for the previous two years, and must be in operating condition

The grant may pay up to 80% of the incremental cost of the replacement vehicle/equipment

The old vehicle or equipment, including the engine, must be scrapped

Old locomotives may be permanently removed from the state in lieu of scrapping


Repowers

Replacement of an existing engine on a vehicle or equipment

New engine must be certified to emit at least 25% less NOx than the engine being replaced

The grant may pay up to 100% of the incremental cost of the repower

The old engine must be scrapped or sent to an OEM remanufacture facility


Retrofit or Add-on

Installation of a retrofit or add-on device

The device must be verified to result in at least a 25% reduction in NOx emissions on that engine

The grant may pay up to 100% of the incremental cost of the retrofit or add-on


Refueling Infrastructure

Purchase and installation of infrastructure to provide a qualifying fuel

Emissions reductions are determined based on what is done with the vehicle or equipment using the fuel

TCEQ may pay up to 50% of the incremental costs


On-Site Electrification and Idle-Reduction Infrastructure

Purchase and installation of infrastructure to provide electricity or services to vehicles or equipment

Emissions reductions are determined based on what is done with the vehicle or equipment using the infrastructure

TCEQ may pay up to 50% of the incremental cost


On-Vehicle Electrification and Idle- Reduction Infrastructure

Purchase and installation on a vehicle or piece of equipment to replace the power normally supplied by the propulsion engine

Includes auxiliary power units (APUs) and similar systems

Emissions reductions based on the hours of use of the infrastructure in lieu of the propulsion engine

TCEQ may pay up to 100% of the incremental cost


Rail Relocation and Improvements

Improvements at a rail intersection in the eligible counties

Emissions reductions may be based on both the reduction in locomotive engine idling and reductions in vehicle engine idling as a result of the improvements

The applicant must provide studies and information to support the emissions reduction projections


Cost Limits

Projects may not exceed cost per ton limits:• Locomotives & Marine: $5,000• On-road, Non-road, & Stationary: $10,000

May not exceed the incremental cost of the activity:• Replacements may not exceed 80% of the

incremental cost• Retrofits, repowers, on-vehicle infrastructure,

and rail relocation projects may be eligible for 100% of the incremental costs

• On-site refueling or electrification infrastructure may be limited to 50% of the eligible costs


REBATE GRANTS

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Image of TERP Logo


Eligible Emission Sources

On-road heavy-duty diesel vehicles

Non-road heavy-duty diesel equipment• Only certain types vehicles/equipment

Marine vessels are not eligible


Eligible Project Categories

Replacement of older vehicles and equipment with newer models

Repower (engine replacement) existing vehicles and equipment


Cost Limits

May not exceed the incremental cost of the activity

Must be the lesser amount of the Rebate Table Amount or the Incremental Cost

Replacements may not exceed 80% of the incremental cost

Repowers may be eligible for 100% of the incremental costs


Grant Management

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Image of TERP Logo


Usage Commitment

On-Road Vehicles:The applicant must commit to operating the vehicle at least 75% of the annual usage in a combination of the eligible counties and on one or more of the designated highways or roadways. At least 25% of the annual usage must occur in the eligible counties.

All Other Equipment:At least 75% of the annual usage must occur in the eligible counties.

Miles/Hours/Fuel Use:Under the ERIG program, the applicant must use the equipment in the eligible counties for the number of hours, miles, or fuel use agreed to in the application. For the Rebate Grants Program, the miles or hours are defaulted.


Activity Life Commitment

Activity Life:• Grant funded equipment must be used in the

eligible counties/areas for a minimum of 5 years for non-road equipment and 7-years for all other projects, including marine equipment.

Reporting Requirements:• All grant recipients must track and report on the

use and location of all grant-funded equipment for the duration of the Activity Life.

• Reports will be due semi-annually over the duration of the Activity Life.


Monitoring and Enforcement

The grant recipient must submit usage reports twice per year (GPS reporting may be used in lieu of the paper reports)

In addition to reviewing the usage reports, TCEQ will conduct onsite visits to view the equipment and to ensure that usage records are being maintained

Failure to report or to meet the usage commitments may result in the recipient having to return a share or all of the grant funds

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Image of log book


Global Positioning System

Global Positioning Systems (GPS): OPTIONAL

• The costs to purchase and install a GPS unit to track and log the location and use of the equipment may be included in the incremental cost (these costs will count towards the applicable cost limits).

• The applicant will be responsible for monthly operational and maintenance charges.

• If the applicant uses the TCEQ authorized service provider, the TCEQ may allow the vendor to provide the required usage reports.


Contracts

Emissions Reduction Incentive Grants• a contract will be sent to the selected applicant

to sign and return• a Notice to Proceed will be sent to the applicant

with the executed contract

Rebate Grants• the application is the contract form (once

approved and signed by TCEQ, it is an executed contract)


Reimbursement

Grant funds are paid to reimburse expenses incurred by the grant recipient

Reimbursements are made after the purchase

Grant recipients may assign the grant payment to the dealer or financing entity

Reimbursement forms are provided with the contract


Disposition of Old Equipment

Salvage Only (see exceptions for locomotive)

$1,000 scrappage default amount is used for on-road and non-road projects

Disposition must occur within 90 days of receiving your payment from TCEQ

Every destruction is verified by TERP staff through photos, documents, or site visits.


Sample Disposition Photo

Wedge Cut in

the Frame


Sample Disposition Photo

Engine Serial Plate

Hole in the

Engine Block

Cut Frame


Use of Consultants

Consultants may be available to assist with the application process• The TERP Program has no relationship with

these consultants and it is up to you if you want to use them

• Consultant fees may not be paid for from the grant, nor can the cost basis for determining the total costs include consultant fees, even if those fees are to be paid by the dealer


Next Grant Rounds

The next ERIG grant application period will open in the spring of 2010

Next Rebate application period will open in October 2009

Enter your email address on the TERP Web site to receive program updates

www.terpgrants.org


Contact Information

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Images of TERP Web address, email address, and telephone number

texas emissions reduction plan (terp) -...

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