California container ports find themselves in unfamiliar territory this year. The Southern California ports of Los Angeles and Long Beach have instituted hiring freezes after years  growth in cargo and staff.

As belt tightening goes on, port officials in Southern California say there is one area that isn’t on the chopping block: Environmental programs will go on as planned, they say.

Less cargo will mean less revenue for new trucks.

“Many of these programs in our Clean Air Action Plan are in the midst of moving forward,” said Richard Steinke, executive director at Long Beach. “With the clean-trucks program, we anticipate moving forward as fast and as soon as the FMC allows us to do so.”

But legal action by the Federal Maritime Commission is slowing the cleanup.

The two San Pedro Bay ports jointly implemented the Clean Air Action Plan several years ago and last year passed similar clean-trucks programs. While parts of those programs, including a progressive ban on older, dirty trucks, have been put in place, other items are on hold for legal reasons. To date, the Federal Maritime Commission has blocked the ports’ plan to charge a $35-per-TEU fee on cargo entering or leaving the ports.

That money was to be used to help subsidize the replacement of about 16,800 old, polluting trucks. Without the millions of dollars expected to be collected from that fee, the ports have less money to invest in new trucks.

Even when the ports do begin collecting the fees, the amount will not reach what was anticipated just a few months ago. Because it is on a per-TEU basis, lower traffic levels will result in less money collected. The ports are not expecting traffic levels to recover any time soon. In fact, the Saturday shift of the PierPass off-peak program has been eliminated because cargo levels have fallen precipitously.

The ports may consider methods other than cold-ironing for vessels.

And, at the end of the year, the truck-replacement program suffered another funding blow. A portion of the funding was to come from the California Air Resources Board through bond money approved by voters in November 2007. But the state is now unable to sell any bonds: The weak bond market is one factor, and the fact that the state does not have a budget is another.

“Because the state bond funds are not available, we have decided not to put any money in that fund at the moment,” said Arley Baker, spokesman for the Port of Los Angeles. The fund is used to pay subsidies of about 80 percent on new clean-diesel or natural gas trucks. Baker said that instead the port is going ahead with prior commitments to give $20,000 per truck payments to approved carriers that bought clean trucks without public subsidies. The port has put aside $44 million for that purpose and is now starting the “due diligence” portion of the exercise to determine how many applications it has on hand and how many trucks qualify for the payment.

But Steinke said the Port of Long Beach is going ahead with its aid to the subsidy pot. 

“It’s a misnomer to say we aren’t going to be replacing trucks,” Steinke said. “Whether all 16,800 trucks get replaced with subsided equipment is up in the air, but we’ll go as far as we possibly can with the funds available.

“It’s just incorrect to say we’ve decided we’re going to scale down the clean-trucks program before we know how far our fee, our own funds and bond funds will take us. The unfortunate thing is that it may ramp up differently than we thought six months ago,” Steinke said.

Steinke and Baker acknowledge that other portions of the Clean Air Action Plan could be delayed for budgetary reasons.

“New cold-ironing programs at certain berths could be delayed beyond our original schedules,” Steinke said. “They take enormous outlays. On the other hand, some things like sock-on-a-stack and other technologies we will continue to research. Those we already have invested in, we will continue to pursue.”

Cold ironing, or having vessels plug into shore-side electricity while in port, is more expensive to accomplish in Long Beach than in Los Angeles because the port does not have its own source of power and it will cost more to move the electricity to the docks.

The sock-on-a-stack program uses a multi-ton bonnet that fits over the smokestack of a vessel and scrubs the emissions clean. It is less expensive to put in and can be used with any vessel.

“Our approach on the green side is to see what we can postpone based on declining cargo volumes,” Baker said. “Some new (cold-ironing) would be something that we could postpone because our emissions inventories have shown that emissions are already going down and volumes coming through the port are coming down.

“We can push that back a little bit. All those programs cost money for us and for our customers, so it is unfortunately something we’re looking at because of economic circumstances,” Baker said.

The changing economics resulted in a softening in the ports’ position on how flexible they will be with what technologies are required.

“We have green port leases, and we will continue to require that our customers operate in a green manner,” Steinke said. “If someone can build a better mouse trap and operate for less, we’re in favor of that. Cost is certainly a major part of the equation, but it isn’t all of it. Sock-on-a-stack wouldn’t work for oil tankers, for example. Who knows, we may end up in a few years with myriad air applications.”

Steinke said the changed financial atmosphere doesn’t mean the port will be able to cut environmental corners. “Environmental groups are very strong in what they believe in. They won’t modify their beliefs for the sake of economy. Our template is we know what these beliefs are and will develop and construct and mitigate based on what we need to do.”

But David Pettit, attorney for the Natural Resources Defense Council, said there is a new and challenging political atmosphere for his group to work in.

“It’s ironic in a way, because the public health risk is somewhat reduced if less imports are coming in, but there is less money attached to the programs,” he said. “But it would be short-sighted to cut back on long-term programs and gains.”

Asked if the group is willing to accept vessel emissions-reduction programs other than cold-ironing, Pettit said, “If they had a magic wand and could wave away the pollution, we’d be thrilled, but there is no wiggle room on results.”

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