April 2: Big day for southern California warehouse owners

A public hearing on April 2, 2021, in Southern California could have a considerable impact on large warehouse owners and operators in the greater Los Angeles area spreading from the California coast to nearly the California/Arizona border. The area, which is governed by the South Coast Air Quality Management District (SCAQMD) makes up the South Coast Air Basin, Salton Sea Air Basin, and Mohave Desert Air Basin comprise all of Orange County as well as large portions of Los Angeles, Riverside and San Bernardino Counties.

The SCAQMD has determined that air quality is worse in areas with a heavy concentration of warehouses, largely due to truck trips into and out of the area. In order to meet state and federal air quality standards, they are using this rule to strongly encourage warehouse operators to implement a more emissions friendly approach to logistics and transportation uses. The SCAQMD has come up with a point-based system for warehouse users called “WAIRE points” (Warehouse Actions and Investments to Reduce Emissions). Should this measure pass, each warehouse will be required to earn a certain number of “points” annually to meet compliance restrictions.

If adopted on April 2, 2021, compliance could be achieved three ways:

1. Implement emissions friendly upgrades to the facility by choosing options from the WAIRE menu. Each menu activity is assigned a point value which counts toward the total number of points the warehouse needs to be considered compliant. Examples include:

• Acquiring net zero or zero emission vehicles earns 26-126 WAIRE points depending on vehicle size
• Installing zero emissions charging or fueling infrastructure earns 3-1680 WAIRE points
• Instillation of solar panels earns 15-19 WAIRE points

2. Create, submit and have a custom WAIRE plan approved by SCAQMD.
3. Pay a mitigation fee

• The mitigation fee allows warehouse users to buy WAIRE points. Users can buy all of the points needed to achieve compliance, or just the difference between the WAIRE points earned through other activities and the total needed to reach compliance. This is likely to be a very costly option as the cost is $1,000 per WAIRE point. This will be an annual cost.
• Before you can accurately determine the financial impact, you have to figure out how many WAIRE points each facility needs to reach compliance and that number is based on how many truck trips, and type of trucks going to or from the facility.

The anticipated timeline for compliance varies based on warehouse size:

• Warehouses 250K SF and over would be required to begin tracking and self-reporting Aug 2, 2022
• Warehouses between 150K SF -250K SF would begin Aug 1, 2023
• Warehouses between 100K SF and 150K SF would begin July 31, 2024

If interested in tuning in to the remote public hearing on April 2, please click here.