CARB On-Road Diesel Regulation Impact Fact Sheet

-California Independent Oil Marketers Association (CIOMA)

The California Independent Oil Marketers Association (CIOMA) is the statewide, industry-segment association for independent wholesale and retail marketers of gasoline, diesel, lubricating oils and other petroleum products. CIOMA members continue to expand their businesses to include alternative fuels, C-Stores, car washes, card locks and other related trade.

CIOMA has approximately 400 members, including nearly 90% of all the independent petroleum marketers [also known as jobbers] in the state.  About half of the CIOMA members are directly involved in petroleum product distribution.

Jobbers buy fuel at terminals, called “racks”, and distribute it to their customers. These customers include local governments, law enforcement, city and county fire departments, ambulances/emergency vehicles, school district bus fleets, construction sites, marinas, public and private transit companies, hospital emergency generators, truck stops, independent fuel retailers (small chains and mom-and-pop gas stations), branded outlets and California farming businesses. The extent, versatility and quick response provided by the independent marketers has led the California Energy Commission to rely on them to provide fuels in emergency situations, such as earthquakes, wildfires, floods and other catastrophes.  Marketers are also the primary distribution chain for industrial and commercial lubricants.

CIOMA works with city, county, state and federal governments to inform elected and regulatory officials about petroleum marketers' concerns. CIOMA helps its members stay aware of state and local issues that will affect their businesses, employees and communities. CIOMA is the industry legislative and regulatory watchdog.

-Contributions to California

Independent oil marketers are widely distributed throughout the state.  Marketing firms are small businesses, typically family-owned for generations.  CIOMA members provide quality employment opportunities for more than 13,000 workers in the state, including over 5000 jobs paying more than $20/hour in rural and economically depressed locations.  Most full-time jobs include employee benefits such as medical insurance and retirement contributions.

CIOMA members have spent more than $350 million complying with California’s complex and expensive environmental requirements.  Significant expenditure areas include:

  • Vapor recovery and enhanced vapor recovery technology at fuel dispensing outlets and service stations;
  • Compliance monitoring technology (tank containment and vapor control);
  • Upgraded underground storage tanks;
  • Spill controls, prevention and response;
  • Cargo tank testing and compliance;
  • Hazardous materials security measures; and,
  • Employee safety and compliance training.

 

CIOMA members are also involved with the collection of over $600,000,000 of transportation/fuels taxes per year in California.

-Fleet Information (size, cost of new trucks, annual mileage, turnover, cost of retrofits -- if available)

Oil marketers use diesel trucks extensively in the distribution of fuel and lubricants all over the state.  Diesel trucks are necessary due to the load weight and driving conditions encountered in the delivery process.  CIOMA members own and operate between 3500-4000 diesel powered trucks.  Much of this fleet is comprised of specialized vehicles especially configured for bulk liquid/hazardous material transportation.

Based upon a recent survey, costs of new, 2007 engine-model vehicles used in petroleum delivery are as follows:

  • Tractors - $110,000 - $125,000 depending on configuration & extras (such as Smart Drive package)
  • Bobtails (tank(s) and engine on same chassis) - $200,000 - $275,000, depending on configuration
  • Flatbeds (lubricants or bulk delivery) - $65,000 - $140,000, depending on configuration
  • Repower of bobtail - $22,000 - $30,000 depending on original engine age and chassis configuration (A significant concern here is whether many bobtails will be able to be repowered.  Issues are raised by the close proximity of highly heated emission components – particle traps and emission converters – in relation to explosive fuel tanks.  Insufficient research has been performed to know if the repower option is realistic for much of the bobtail fleet.)
  • Vans and pickups - $18,000- $35,000 depending on configuration.

 

Other concerns with the purchase of new vehicles include:

  • Inability to perform routine maintenance and repairs - Like new cars, the new trucks usually need to be taken to a certified repair technician.  Older trucks are usually maintained and repaired by company staff, saving expensive labor and truck downtime.
  • Decreased fuel mileage – New trucks operate at reduced efficiency, thereby adding additional fuel costs on top of the equipment purchase expense.
  • Loss of property value – Since the older trucks being replaced cannot be sold in California, and there will be a lot of trucks thrown into the market in a short period of time, the existing value of currently owned trucks will be substantially reduced.  This not only represents a “taking” of property value by the government, it may create significant problems in obtaining financing for new vehicles, since the used trucks will not be able to be used in “net worth” calculations.
  • Lack of particle trap options for older trucks & cost – Many older trucks cannot be reconfigured with particle traps and the cost of retrofitting can easily exceed the cost of the vehicle, making it uneconomic to make this investment.
  • Lack of NOx retrofit technology – There are no certified retrofit systems available to meet the 2007 engine-model NOx emission standards.  Our experience with other CARB certification programs (namely vapor recovery requirements) has shown many complications and unanticipated costs are encountered in these “technology-pushing” programs, and there is no guarantee that equipment will be certified in a timely manner.
  • Unknown price tag for 2010 or later trucks – Since these engines are still in the design stage there is no way of knowing what the ultimate cost might be, but it will definitely be more expensive than the 2007 versions.