Understanding Southern California’s WAIRE Program and How Our Solution Can Help

Southern California’s Warehouse Actions and Investments to Reduce Emissions (WAIRE) Program, established by the South Coast Air Quality Management District (SCAQMD), is a regulatory initiative designed to curb air pollution stemming from warehouse operations. This program applies to facilities located in Los Angeles, Orange, San Bernardino, and Riverside counties—areas that have long struggled with air quality issues due to the heavy presence of logistics and transportation hubs. The WAIRE Program aims to mitigate the environmental impact of warehouse-related emissions, particularly from diesel-powered trucks that transport goods to and from these facilities.

While the WAIRE Program is intended to help meet California’s strict air quality standards, its implementation has introduced significant challenges for warehouse owners and operators. Compliance with Rule 2305, the regulatory framework underpinning the program, requires businesses to either adopt cleaner technologies or pay substantial fees. With over 4,000 warehouses affected, staying ahead of both federal and state air quality regulations is crucial to avoiding fines and optimizing operations.

What is the WAIRE Program?

The WAIRE Program assigns a compliance obligation to warehouse owners and operators based on the volume of carbon-fueled truck trips their facility handles annually. This obligation is quantified in WAIRE points, the system that establishes emission reduction requirements. If an operator fails to accumulate the necessary WAIRE points through mitigation measures, they face a financial penalty of $1,000 per unmet point.

Warehouse operators and owners can meet their compliance obligations by selecting from a menu of mitigation actions, implementing a custom WAIRE plan, or paying an annual mitigation fee. The program is structured to encourage businesses to transition toward cleaner transportation technologies, such as Near-Zero Emission (NZE) and Zero-Emission (ZE) vehicles, rather than simply paying penalties.

Who is Affected by the WAIRE Program?

The WAIRE Program applies to warehouse owners and operators managing facilities with at least 100,000 square feet of indoor space in a single building. These businesses must comply with WAIRE requirements by either earning sufficient points or submitting the necessary reports to demonstrate their efforts in emission reduction progress.

While warehouse owners are required to submit an information report, their primary responsibility is to ensure compliance with the facility’s operators. Operators, on the other hand, bear the responsibility of earning WAIRE points and reporting their compliance progress.

How Can Warehouse Operators Earn WAIRE Points?

Warehouse operators and owners can earn WAIRE point through three primary methods:

1. Completing Actions from the WAIRE Menu: The WAIRE Menu includes a set of pre-approved measures designed to reduce emissions, such as installing onsite electric vehicle (EV) charging stations, using solar panels, or replacing diesel-powered trucks with NZE or ZE vehicles.
2. Implementing an Approved Custom WAIRE Plan: Operators can submit a customized mitigation strategy for approval, allowing them to develop tailored compliance approaches that align with their specific operations.
3. Paying an Annual Mitigation Fee:

If an operator earns more points than required in a given period, they can bank extra points for future use or transfer them to another warehouse they operate. However, WAIRE points cannot be sold to external companies.

Compliance Requirements for Warehouse Owners and Operators

Warehouse Owners:

• Owners must submit an informational report called a Warehouse Operators Notifications (WON), which provides details about the warehouse and its tenants.
• Owners do not need to earn WAIRE points unless they also operate the warehouse.

Warehouse Operators:

• Must submit two reports:
  • Initial Site Information Report (ISIR): A one-time submission detailing facility operations and compliance strategies.
  • Annual WAIRE Report (AWR): Submitted once per compliance period, detailing how many points were earned and the operator's WAIRE Points Compliance Obligation (WPCO).
    

Our Solution: Achieving WAIRE Compliance with Clean Transportation

Warehouse operators can adopt various strategies to mitigate WAIRE fines. One of the most effective strategies is integrating NZE and ZE vehicles into supply chain operations. By adopting clean transportation methods, businesses can significantly reduce their compliance burdens while also benefiting from cost savings and improved sustainability operations.

At ITS Logistics, we offer a comprehensive solution to support warehouse operators in meeting their WAIRE compliance obligations. Our approach includes:

NZE and ZE Load Management: We facilitate the integration of NZE and ZE carriers into your supply chain, focusing on drayage operations where these technologies are most effective. This approach not only helps in offsetting WAIRE points but also contributes to significant cost savings.

Customized Compliance Plans: We develop tailored strategies to meet your specific WAIRE compliance obligations to provide efficient and cost-effective solutions.

For one of our customers operating distribution centers in WAIRE-affected counties, we implemented a solution focusing on converting inbound and outbound ocean container shipments to NZE and ZE carriers. In this first year, this approach will result in 4,820 loads managed with clean transportation vehicles:

• 75% with NZE carriers: 3,615 loads, offsetting 415 points ($415,000 in fines) and 32,535 carbon-fueled loads.
• 20% with ZE carriers: 964 loads, offsetting 135 points ($135,000 in fines) and 10,604 carbon-fueled loads.

This will lead to a total annual offset of $550,000 and a reduction of 43,139 carbon-fueled loads.

Why WAIRE Compliance Matters

The WAIRE Program presents both challenges and opportunities for warehouse owners and operators in Southern California. By proactively adopting mitigation strategies, businesses can not only comply with air quality regulations but become a sustainability leader in their industry.

At ITS Logistics, we’re committed to helping warehouse operators navigate WAIRE compliance with tailored and effective solutions. Our team understands that every operation is unique, and we are ready to work with you to develop a strategy that meets your compliance obligation.

Contact us today to learn how we can support your business in reducing emissions, offsetting WAIRE points, and positioning your operation for long-term success in a rapidly evolving regulatory landscape.

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