Redesigning Ontario’s Drive…

Redesigning Ontario’s Drive Clean Motor Vehicle Emission Testing Program - EBR Registry Number 013-3867

Submitted to: Ministry of the Environment, Conservation and Parks, Ministry of Transportation

Submitted by the Canadian Propane Association

October 28, 2018

Executive Summary

Expanded use of propane is a game changer for Ontario. Recognized for its low environmental impact by Canada’s Alternative Fuels Act, auto-propane is a cost-effective, safe, globally-trusted, low-emission automotive fuel option for motor vehicles. It can make an immediate contribution in helping to protect Ontario’s air quality and reduce human exposure to harmful heavy vehicle emissions, such as particulate matter and other smog-causing pollutants.

In the Canadian Propane Association’s (CPA) submission to EBR Registry Number 013-3867, Redesigning Ontario’s Drive Clean Motor Vehicle Emissions Testing Program, our submission shows the vital role auto-propane can play in low-emission
transportation and demonstrates the game changing advantages of the expanded use of auto-propane, as a viable solution, that can maximize emissions reductions from on-road heavy vehicles, while balancing regulatory burden and stimulating rural economic development.

Recommendations

• The full inclusion and participation of the propane industry in the development of new emissions reductions projects, policies and programs

• A predictable and modern emissions testing program that consider exemptions for propane vehicles from heavy-duty vehicle testing requirements

• Differentiate emissions testing by type of fuel, recognizing different fuels generate different amounts of greenhouse gas emissions, pollutants, toxics and particulates emitted

• Officially recognize the environmental advantage of auto-propane as a cost-effective clean burning alternative fuel that emits up to 98% less particulate matter than diesel vehicles and 26% less lifecycle greenhouse gas emissions than gasoline

• Target both diesel and gasoline “heavy vehicles”, as defined in O.Reg.361/98, Environmental Protection Act, R.S.O., 1990 that captures school and transit buses, business and public fleets and all other high-mileage vehicles

• Provide market-based incentives to industry to upgrade heavy vehicle fleets to cleaner propane vehicles through a new propane policy and program

Redesigning Ontario’s Drive Clean Motor Vehicle Emissions Testing Program

The propane industry recognizes we all need to do our part to reduce harmful emissions and collectively face our environmental challenges.

While the CPA supports the proposed changes to the Drive Clean emissions testing program, the CPA considers the following overarching principle as crucial to developing public policy:

“In all its policy, government must ensure a level playing field – with no exemptions, no exclusions, and all participants treated fairly and equally.”

Redesigning heavy-duty vehicle emissions testing

The CPA understands the need for the Ontario government to make changes to heavy-duty vehicle testing with an effective program and value for taxpayers.

We strongly support shifting focus to heavy emitters by targeting heavy duty diesel vehicles and recommend the proposal goes further by also targeting heavy-duty gasoline vehicles with a focus on vehicle classifications such as school and transit buses, municipal police vehicles and business fleets.

The CPA has concrete proposals where auto-propane can be a game-changer for emission reductions and improving air quality in Ontario.

The CPA supports any proposed design changes that strongly encourage and establish market-based incentives for impacted transportation industries to upgrade and convert heavy-diesel and gasoline commercial fleets to more efficient and cleaner propane vehicles.

Auto-propane is recognized for its’ environmental advantages and this should be reflected in the program through exemptions from certain emission testing requirements such as frequency and vehicle age.

The CPA strongly supports the creation of an incentive program and policy for industry to demonstrate cleaner fleets. The proposed auto-propane program provides significant opportunities to support fleet owners across Ontario.

For the purpose of supporting the program development and design, the CPA requests our auto-propane proposal be part of the industry incentives for cleaner fleets.

Strengthening the on-road enforcement of emissions standards

The CPA supports design changes for strengthening anti-tampering restrictions with regard to emission control systems, that accommodates and supports Original Equipment Manufacturer (OEM) and aftermarket propane vehicles conversions.

Purpose of the Proposal

The CPA’s auto-propane solution for reducing emissions clearly supports the overall purpose and goals of the proposed changes to the program. The CPA’s auto-propane proposal directly aligns with following program objectives:

• Protect Ontario’s air quality with an effective program that provides value for taxpayers
• Reduce human exposure to dangerous diesel emissions, nitrogen oxides and particulates
• An effective testing program that considers the advantages of propane vehicles and that maximizes emissions reductions from on-road heavy-duty diesel vehicles
• Provide benefits in air quality and human health through reductions in emissions from heavy-duty diesel vehicles (including passenger carrying vehicles such as school buses)
• Encourage compliance by the on-road heavy duty vehicle fleet with Ontario EPA with new propane vehicles
• Create a fair and level playing field where the propane industry contributes to reducing heavy-diesel emissions and improving air quality

Auto-Propane Program and Policy Solutions
Overview

Propane is safe, viable and trusted alternative automotive fuel in Canada and worldwide. In Ontario, auto-propane was successfully included in the Ministry of Transportation Green Commercial Vehicle Program (GCVP) from 2008-2010.
A 2017 report by the McMaster Institute for Transportation and Logistics confirms that investments in propane technologies can leverage the low prices of propane fuel to generate significant returns on investment (ROI) over the commercial vehicle’s lifecycle, while making significant contributions to reducing harmful emissions and improve air quality.
The CPA proposes the government adopt our recommended policy solution for lowering emissions in the commercial vehicle transportation sector through developing a program that incentivizes market uptake for auto-propane.

Program Highlights:
• Create a Propane Commercial Vehicle Program (PCVP) targeting 50,000 gasoline and diesel vehicles
o Costs for conversions are between $7,500 to $13,500 per vehicle
• Offer clean fleet incentives for the purchase of Original Equipment Manufacturer (OEM) vehicles designed for propane
o Costs for OEM conversions are between $3,000 to $5,400 per conversion
• Incent approved conversion systems (such as those approved by US Environmental Protection Agency (EPA)/ California Air Resources Board (CARB) (tested and certified low-emission)

Environmental and Economic Benefits:
• An immediate reduction of operating costs by a minimum of 20% from fuel savings
• Every diesel vehicle converted to propane would result in 180 tonnes reduction in CO2
• Converting or upgrading 50,000 vehicles in rural and remote communities would reduce 5,135 million tonnes of CO2 GHG lifecycle reductions
• 98% less air contaminants than diesel-fuel and 20% less nitrogen oxide at combustion

Fleet Benefits – Commercial, heavy-duty transports, municipalities and district school board
• A Propane Commercial Vehicle Program would reduce conversation / upgrade payback period and fuel costs over lifecycle
• Payback and Savings:
o Gasoline vehicle to propane: 18-month payback and $21,500 in savings
o Diesel vehicle to propane 26-month payback and $44,375 savings

Regulatory Barriers
• Repeal the Technical Standard and Safety Act, R.S.O, 2000 regulations requirement to train for refilling auto-propane vehicles and TSSA Code Adoption Document (CAD) restrictions – limit market entry and increases financial burden.

The Auto-Propane Advantage

The CPA’s auto-propane policy and emissions reductions program recommendations can provide significant and immediate opportunities to:

• Lower emissions in the commercial motor vehicle transportation sector through incentivizing greater market uptake for auto-propane.
• Improve and modernize the provincial policy and regulations to reduce red tape burden and remove restrictions placed on the propane industry’s capacity to deliver fuel to consumers.
• Improve commercial vehicle fleets’ access to low-emitting and cost-effective options to upgrade or convert propane vehicles.
Recognized for its low environmental impact by Canada’s Alternative Fuels Act, auto propane is a cost-effective, safe and globally-trusted and low-emission automotive energy option. It has many economic and environmental advantages over traditional and alternative vehicle fuels.

In every application, propane reduces combustion GHG emissions when compared to gasoline.
• Light duty trucks: 11% fewer GHGs
• School buses: 18% fewer GHGs
• Lawn mowers: 16% fewer GHGs
• Irrigation engines: 20% fewer GHGs

Studies have found that propane can emit up to:

• 26% fewer GHGs than gasoline in vehicles
• 32% fewer tailpipe emissions than diesel in medium size vehicles
• 20% less nitrogen and sulfur dioxide at the point of combustion
• 98% less particulate matter than diesel

Propane’s end-use GHG emissions are significantly lower than gasoline, diesel, coal and heating oil. When upstream (lifecycle) emissions are considered, the case for propane becomes even stronger.

Air pollutants negatively affect people and ecosystems worldwide. Criteria air contaminants and air toxics contribute to smog, ground-level ozone, haze and acid rain; and health problems such as allergies, asthma, skin and respiratory tract irritation, and cancer.

It is important to consider that propane:
• Emits 60% less carbon monoxide (CO) than gasoline
• Emits low levels of sulfur, practically no soot, and low hydrogen and nitrogen oxides
• Releases less air toxics like benzene and acetaldehyde than gasoline and diesel
• Propane systems feature technology that precisely regulates fuel delivery through advanced computer control units and direct injection
• OEM vehicles are available from manufacturers such as Blue Bird and IC Bus
• Propane conversion-ready vehicles are available from manufacturers such as Ford
• Propane vehicles have equivalent range and power to traditional fuels
• Propane has the largest refuelling infrastructure of any alternative fuel in Canada

Auto-Propane Optimal Vehicle GVWR Classifications

Auto-propane typically competes with diesel in vehicles that fall into GVWR Class 3-8 and with gasoline in fleets using Class 3-6 vehicles or as defined in the Environmental Protection Act, R.S.O 1990, C E.19 O.Reg.361/98 as a “heavy vehicle” (motor vehicles with GVWR greater than 4,500 kilograms).

Auto-propane is ideally suited for fleet vehicles such as school and transit buses, courier vans, police cars, taxis, limos and any other high-mileage vehicles.

This table (hard copy of submission) above shows that modern propane vehicles can help achieve clean air objectives by reducing GHG emissions and other harmful airborne particulates, especially when compared to diesel vehicles. The final column, Percent Difference (vs. diesel) shows that propane (LPG) offers a 32% reduction in CO2 tailpipe emissions, the main component of GHG emissions.

The propane industry has utilized the GREET Model (greenhouse gases, regulated emissions and energy use in transportation), using up-to-date data. Developed by Argonne National Laboratory and sponsored by the US Department of Energy’s Office of Energy Efficiency and Renewable Energy, GREET is widely recognized as the ‘gold standard’ for evaluating the environmental impacts of fuel technologies. Emissions data presented from the GREET model is compared on an energy equivalent basis.

The GREET analysis also shows that propane provides a reduction in other emissions that can impact smog, air quality and acid rain, such as Particulate Matter and Carbon Monoxide. The primary purpose of redesigning heavy vehicle emission testing is to minimize harmful emissions. Which are the very same desired environmental outcomes that auto-propane offers as a solution
Conclusion

Propane can be a game-changer for Ontario and this submission presents our recommendations on how propane can make an immediate contribution in helping to protect Ontario’s air quality and reduce human exposure to harmful heavy vehicle emissions. The government of Ontario should take the following actions:
• The full inclusion and participation of the propane industry in the development of new emissions reductions projects, policies and programs

• A predictable and modern emissions testing program that consider exemptions for propane vehicles from heavy-duty vehicle testing requirements

• Remove barriers to entry in legislation and red tape for auto-propane

• Incentivize heavy-duty fleet owners and consumers to significantly reduce emissions and access cost-savings by upgrading or converting heavy-duty diesel fleets to cleaner propane fleets

• Ensure legislation, regulations and programs are developed in a way that:

o Creates a fair and level playing field
o Recognizes the environmental advantage of propane
o Maximize emissions reductions

Industry Overview

Canada’s propane industry includes an extensive supply chain, from extraction to end-use across the residential, transportation, agricultural, petrochemical, industrial and commercial sectors. The industry’s footprint extends all across Canada.
According to a 2018 report by the Conference Board of Canada, the propane sector’s contribution to the Canadian economy is expected to be an estimated $4.4 billion in GDP annually between 2017 and 2025, supporting:

• Close to 21,000 jobs annually across Canada
• Close to $1 billion per year in government revenues

Within Canada, auto propane has the largest refuelling infrastructure of any alternative fuel and there are estimated to be around 60,000 vehicles on the road. Natural Resources Canada (NRCan) hosts a alternative fueling station location for auto-propane recently established between government and industry.

Major fleet operators in Canada who utilize propane for its environmental and economic advantages include UPS, Canada Post, London Police, Airways Transit, TransHelp, school bus operators, and many taxi and limousine operators.

Propane in Ontario

Propane is a readily available, affordable and low-emission energy source with infrastructure already in place. The expanded use of propane can reap immediate results in Ontario’s renewed effort to effectively improve air quality and reduce human exposure to heavy emissions and black carbon. Propane is a safe, affordable, versatile, multi-purpose fuel that is highly portable, clean burning and non-toxic.

Approximately 100,000 Ontario households and businesses rely on propane as their primary and affordable source of heating fuel. Not only that, propane is also used in commercial, transportation, industrial and agricultural applications all across the province. Almost half - about 45% - of propane used in Canada occurs right here in Ontario.

The propane industry provides direct employment for over 2,000 families (labour income worth $115 million in Ontario), many of whom live in rural communities. As well, providing goods and services to the propane industry supports the jobs of many more in those communities. The propane industry also provides over $128 million to the Ontario government in revenues every year.
Many of our Ontario CPA members operate family-run businesses in small towns and rural communities across Ontario. They form the very fabric of the communities in which they live. They volunteer their time, donate to local sports teams and most important create good paying local jobs.

Propane is abundant and available now, with over 140 large storage facilities and 817 small storage sites across the province. Propane has the largest network of alternative fueling stations in Ontario, with 100 locations and 1,800 in Canada.