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Comparative Assessment of the Environmental Performance of Small Engines Outdoor Garden Equipment Prepared for Department of the Environment and Water Resources Vehicle Design and and Research P/L February 2007

Outdoor Garden Equipment - Department of the Environment

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Page 1: Outdoor Garden Equipment - Department of the Environment

Comparative Assessment of the Environmental Performance

of Small Engines

Outdoor Garden Equipment

Prepared for

Department of the Environment and Water Resources

Vehicle Design andand Research PL

February 2007

Disclaimer The research reported in this document was commissioned by the Environment Standards Branch of the Department of the Environment and Water Resources

The views and opinions expressed in this publication are those of the authors and do not necessarily reflect those of the Australian Government or the Minister for the Environment and Water Resources

While reasonable efforts have been made to ensure that the contents of this publication are factually correct the Commonwealth does not accept responsibility for the accuracy or completeness of the contents and shall not be liable for any loss or damage that may be occasioned directly or indirectly through the use of or reliance on the contents of this publication

Acknowledgments This report was prepared for the Department of the Environment and Water Resources and the contribution made by Officers of the Department is acknowledged

The comments on the draft report and other project discussion documents made by members of the Small Engines Expert Panel Outdoor Equipment were appreciated and considered in finalising this report The Panel had representation from

Industry Allpower Industries Stihl Pty Ltd Briggs amp Stratton Honda Australia Motorcycle amp Power Equipment Pty Ltd Victa Lawncare Pty Ltd Rover Mowers Limited Roy Gripske amp Sons Pty Ltd Parklands Trading Co Pty Ltd Kawasaki Motors

Associations Outdoor Power Equipment Association

Government Department of the Environment and Water Resources NSW Department of Environment and Conservation Environment Protection Authority Victoria The Northern Territory Department of Natural Resources Environment and The Arts

In addition overseas government and industry colleagues provided useful feedback and information during the project

i

Contents

Disclaimer i

Acknowledgmentsi

Abbreviations and Glossaryii

Executive Summary iii

1 Introduction1

11 Emissions from outdoor garden equipment engines1

2 Air Quality and Outdoor Garden Equipment Engines4

21 Air Quality Standards 6

3 Emission Standards for Small Engines 8

31 Australia8 32 United States 8 33 Canada12 34 Europe 13 35 Summary of Regulations for Non Handheld Equipment15 36 Summary of Regulations for Handheld Equipment16

4 Australian Market for Small Engines 18

41 Likely compliance with overseas emissions standards18 42 Australian Sales of Outdoor Powered Equipment 22

5 Australian Users of Small Engines 25

51 General Public25 52 Garden and Ground Maintenance Services27 53 Government Purchasing28

6 Result of Stakeholder Consultation 30

61 Regulations 30 62 Discussion on recommended regulations31

7 The Way Forward 35

71 Options to Reduce Emissions from Garden Equipment Engines 38 72 Option 1 ndash Do Nothing 39 73 Option 2 ndash Industry - Government Partnership39 74 Option 3 - Quasi Regulation 39 75 Option 4 -Co Regulation40 76 Option 5 - Regulation40 77 Preferred Approach44

References 45

ii

Appendix 1 Detailed Breakdown of Powered Garden Equipment on the Australian Market 51

Appendix 2 Examples of Current Australian Benchmarking Programs55

Appendix 3 Productivity Commission Comments on Labelling and Minimum Performance Standards 71

iii

List of Figures

Figure 1 Example of a Californian Consumer Advisory Hang Tag11

Figure 2 Extract from survey form18

Figure 3 Compliance with overseas standards - all surveyed products20

Figure 4 Compliance with overseas standards by equipment type21

Figure 5 Engine type for popular categories 21

Figure 6 Compliance with overseas standards for popular categories 22

Figure 7 OPEA estimates of equipment sales in 2005-0624

List of Tables

Figure 1 Example of a Californian Consumer Advisory Hang Tag11

Figure 2 Extract from survey form18

Figure 3 Compliance with overseas standards - all surveyed products20

Figure 4 Compliance with overseas standards by equipment type21

Figure 5 Engine type for popular categories 21

Figure 6 Compliance with overseas standards for popular categories 22

Figure 7 OPEA estimates of equipment sales in 2005-0624

i

Abbreviations and Glossary 2c Two stroke with carburettor 2di Two stroke with direct fuel injection 2i Two stroke with pre-chamber fuel injection 4c Four stroke with carburettor 4i Four stroke with fuel injection (includes direct injection) ABS Australian Bureau of Statistics ABT Averaging Banking and Trading of emissions ADR Australian Design Rule Air NEPM National Environment Protection Measure for ambient air quality BTEX Benzene toluene ethylbenzene xylenes - carcinogenic or mutagenic aromatic

hydrocarbons formed through the combustion process CARB Californian Air Resources Board CBA Cost Benefit Analysis cc Cubic centimetres CO Carbon Monoxide DEC Department of Environment and Conservation di Direct Injection efi Electronic fuel injection EU European Union Euromot The European Association of Internal Combustion Manufacturers gkW- hr Grams per kilowatt hour HCs Hydrocarbons ndashmost are VOCS and in relation to small engines the terms are

often used interchangeably hp Horsepower 1 hp =7457 watts ISO International Standards Organization kW Kilowatts MEPS Minimum Energy Performance Standards MOU Memorandum of Understanding NATA National Association of Testing Authorities NOx Oxides of Nitrogen NPI National Pollutant Inventory NSW GMR New South Wales Greater Metropolitan Region which includes Sydney Lower

Hunter and Illawarra regions encompassing the major metropolitan centres of Sydney Newcastle and Wollongong Population approximately 47 million

OPEA Outdoor Power Equipment Association PM10 Particles with an aerodynamic diameter of 25 micrometres or less PM25 Particles with an aerodynamic diameter of 10 micrometres or less Port Phillip Region in Victoria of 24000 km2 that includes Greater Melbourne and Greater Region Geelong It is defined in Victorian environmental policy Population

approximately 34 million (1996) SE Qld South East Queensland - a region that covers the area from the Gold Coast to the

Sunshine Coast and west to Toowoomba It includes Brisbane amp suburbs population approximately 23 million people

USEPA United State of America Environmental Protection Agency VOCs Volatile Organic Compounds WELS Water Appliances Water Efficiency Labelling and Standards Scheme

ii

Executive Summary

Background

This report sets out the results of a project to compare and benchmark emissions from small petrol engines (less than 19 kilowatts) that are used to power outdoor garden equipment and were available for sale in Australia during 2006 The equipment powered by these small engines are used in lawnmowers brushcutters hedge trimmers and the like

These engines emit volatile organic compounds (VOCs) and oxides of nitrogen (NOx) which contribute to ozone (photochemical smog) formation in summer They also emit particles carbon monoxide (CO) and a range of air toxics such as benzene

Sydneyrsquos Greater Metropolitan Region (GMR) annually records exceedances of the National Environment Protection (Ambient Air Quality) Measure (Air NEPM) ozone standards The other jurisdictions meet or are close to meeting the current ozone standards

The Air NEPM standards are being reviewed and based on current human health evidence the argument appears to be strengthening for tighter ozone standards Should a stricter standard or an eight-hour standard consistent with international standardsguidelines be adopted achievability of Air NEPM ozone standards or goals could become an issue for some of the other major urban airsheds

The United States California Canada and Europe regulate emissions from outdoor equipment - the USA has had these in place since 1997 There are no Australian regulations or standards that limit air pollutant emissions from engines used in outdoor garden equipment however as the majority of equipment sold in Australia is imported some do comply with emission standards applicable to the country of origin

Small engines are not as advanced in environmental terms as motor vehicle engines As a result even the better-performing small engines emit far greater quantities of pollutants per hour than typical modern car engines For example the US Environmental Protection Agency (USEPA) 2002 limit for a typical 4 kilowatt (kW) lawnmower motor is about 66 grams (g) of regulated pollutants per hour of operation A typical 08kW brushcutter sold new in 2002 emitted about 160grams of pollutants per hour - reducing to 40grams per hour if bought new in 2006 The equivalent limit for cars under Australian Design Rule 79 is about 16g per hour In other words one hour of operation of a brushcutter that meets USEPA 2002 limits produces the same pollution as ten cars operated over a similar time These comparisons are subject to differences in test methods but they do provide an indication of the disproportionate amount of pollution emitted by small engines

Engines that do not comply with current USEPA requirements are likely to emit several times the amount of pollution calculated in the above example Therefore the worst performing engines are likely to emit more than ten times the emissions of the best performers

iii

Based on estimates made using the National Pollutant Inventory database engines used in lawn mowers contribute approximately 4 on average to VOC emissions from anthropogenic sources in major airsheds in Australia when public open space lawn mowing is included This is likely to rise to around 11 in the warmer spring and autumn weekends which is when lawns and other vegetation grows faster and when gardening is more popular The NPI does not take into account emissions from other types of powered outdoor equipment

The Australian Market

According to the Outdoor Power Equipment Association (OPEA) approximately 424000 walk behind lawnmowers and more than 792000 units of outdoor handheld equipment were sold in Australia in 2005-06 In addition there were sales of about 80000 replacement engines and 70000 pumps in 2005-06 most of which were four strokes The general household consumer represents the major market segment for garden equipment accounting for up to 90 of product sales with commercial garden services and government purchasing the rest

Indications are that sales of imported high polluting two stroke engines have increased over the last few years and it appears that the price of some powered garden equipment has dropped to the level where consumers regard them as disposables

An assessment of outdoor equipment on the Australian market found that the majority of small engines sold in Australia are imported and many come from countries that impose emission limits The extent of imports into Australia that do not comply with the country of origin standards is not known However the industry estimate that 40 of garden products are sold through importers who are not linked to manufacturers of US EPA or European certified equipment and the source of some products sold here is difficult to establish Victa is the only company producing small engines in Australia Its iconic 2-stroke lawn mower engine currently does not meet overseas emission limits for non-handheld equipment and Victa is undertaking research and development to reduce emissions from its two stroke engine to meet US and European standards

In spite of several attempts to obtain data on compliance with overseas emission standards from Australian distributors their response was poor The following figure therefore provides a best estimate of expected compliance of outdoor equipment on the Australian market with European CARB or USEPA requirements applicable in 2004

iv

Figure E1 Compliance with overseas standards for popular categories ldquoPhase 1 equivrdquo means the engine complies with US EPA phase 1 or 200288EU ldquoPhase 2 equivrdquo means the engine complies with US EPA Phase 2 Euro I or Euro 2 ldquoUnknown means that engine cycle (stroke) was not provided

Measures to Increase Sales of Low Emission Garden Equipment Engines

There is a range of options that could be considered for reducing emissions from engines used in outdoor garden equipment engines in Australia These include

1 Maintaining the Status Quo

2 Government ndash Industry Partnership Program

3 Quasi regulation

4 Co-regulation

5 Regulations based on either a simple benchmark or tiered benchmarks

The Small Engine Expert Panel ndashOutdoor Equipment has considered in depth the most appropriate approach to take to improve the emissions performance of outdoor garden equipment sold in Australia It recommends the introduction of national regulations to control the emissions from outdoor garden equipment particularly in light of the increase in cheap imports onto the Australian market which although untested are considered very likely to have high emission levels The Expert Panel has developed some broad recommendation on which Australian regulations could be based which takes in consideration the local market and Victa These are summarised as follows

1 Mandatory air pollutant emission standards to be introduced in Australia for all outdoor equipment (lt19kW) powered by spark-ignition engines

v

The development of any regulation would need to be based on a formal assessment of the costs and benefits of nationally regulating two and four stroke lawn mowers and handheld power equipment which should commence immediately

2 Proposed standards to mirror US EPA regulations (compliance with equivalent EU regulations also acceptable)

3 Timing (subject to completion of assessment of costs and benefits)

(a) US EPA Phase 1 ndash Effective from 20072008

(b) US EPA Phase 2 ndash Fully implemented in 2012 (in step with 2007 USEPA limits) plus a phase-in period andor provisions for averaging banking and trading (ABT) of emissions over 2008-2012 to provide for early introduction of cleaner product

The US EPA Phase 1 and Phase two emissions limits are given in the table below

4 Walk-behind two stroke mowers to be included in US EPA Category 5 (gt50cc) product classifications (to provide Victa time to develop a cleaner engine) Implementation timing is proposed to be the same as Recommendation 3 above

5 All products also to be certified to relevant EPA product durability categories

6 Subject to further review ABT if included may be phased out after 2012

Table E1 Comparison between the USA Phase 1 and Phase 2 standards

Emission Limits GkW-hr

Phase 1 (1997 ndash2001) Phase 2 (2007) HC NOx HC+NOx CO HC+NOx CO

Non-handheld

I-A lt66cc 161 161 610

I-B 66-lt100cc 161 161 610

I 100-225 cm3 161 519 161 610

II 225 cm3 134 519 121 610

Handheld

III lt20 cm3 295 536 805 50 805

IV 20-50 cm3 241 536 805 50 805

V 50 cm3 161 536 603 72 603 Phase 2 limits were phased in between 2002 -2007 during which time they became tighter

For simplicity only the 2007 are shown in this table (see Table 2 for more details)

vi

Conclusion

From this review it is apparent that it is highly unlikely that the companies in the industry would engage in or commit to any voluntary type program It is therefore clear that the most expedient path to reduce emissions from these small engines is through national regulation State based regulations could only provide a piecemeal approach that would lead to product dumping in states where there are no regulations and inconsistent regulations that require industry to treat each state market differently In addition enforcement of any state based regulations would be a key problem due to existing Commonwealth and State Government mutual recognition legislation

While any national regulation of emissions from small engines used in garden equipment in Australia are likely to be based on overseas regulations they need to strike a balance between improved environmental outcome harmonisation with international standards and the characteristics of the local industry With regulations optimum emissions reduction are potentially achievable by combining minimum emissions standards with tiered product labelling Whether this approach is justifiable on economic grounds that is the benefits outweigh the costs can only be determined through a detailed impact assessment Based on these findings it is recommended that a formal assessment of the costs and benefits of nationally regulating two and four stroke lawn mowers and handheld power equipment should be commenced

vii

1 Introduction

This report sets out the results of a project to compare and benchmark emissions from engines used in outdoor garden equipment that were available for sale in Australia during 2006 Possible outcomes from the project range from consumer guidelines for selecting low emission engines to regulatory controls on emissions There are currently no state or national regulations that directly control emissions from these engines

The project was commissioned by the Commonwealth Department of the Environment and Water Resources on behalf of state and territory government departments working on reducing the impacts of small engine emissions This report was prepared in consultation with an Expert Panel that included representatives from the Outdoor Power Equipment Association (OPEA)

11 Emissions from outdoor garden equipment engines

Small engines particularly conventional two stroke engines used in applications such as outdoor garden equipment are high polluters relative to their engine size and usage1 These small engines emit volatile organic compounds (VOCs) and oxides of nitrogen (NOx) which contribute to ozone (photochemical smog) formation in summer They also emit particles carbon monoxide (CO) and a range of air toxics such as benzene The USA California Canada and Europe and regulate emissions of VOCs NOx carbon monoxide and particle emissions from outdoor garden equipment

There are five types of spark-ignition engines that can be used in outdoor garden equipment

bull two stroke with carburettor (2c)

bull two stroke with pre-chamber fuel injection (2i)

bull two stroke with direct fuel injection (2di)

bull four stroke with carburettor (4c)

bull four stroke with fuel injection (4i) (includes direct injection)

Carburettor and pre-chamber fuel injection two stroke engines are inherently more polluting than the other three types This is due to their inability to completely separate the inlet gases from the exhaust gases resulting in up to 30 of the fuel being left unburnt and the need to add oil to the fuel to lubricate the engine (four stroke engines have separate reservoirs for fuel and oil) However twostroke carburettor engines typically weigh less than a four stroke engine of the same power and this tends to make them attractive for handheld equipment They also tend to have fewer components are generally cheaper to purchase and are cheaper to maintain than

1 Outdoor equipment covered in this report are engines less than 19kW

1

four stroke motors Victa Lawncare is currently undertaking research and development to improve the environmental performance of two stroke carburettors and while some emission improvements have been made a two stroke compliant with US or European standards is still considered several years away

Four stroke carburettor engines are generally quieter more fuel efficient and are less polluting than conventional two stroke engines

Direct fuel injection (dfi) either two stroke or four stroke overcomes the unburnt fuel problem and can meet the stringent regulated exhaust emission limits that apply overseas However there is not any evidence that dfi engines are being used in outdoor garden equipment available in Australia It appears that engines used in outdoor garden equipment in Australia are generally restricted to two and four stroke carburettor engines

Small engines are not as advanced in environmental terms as motor vehicle engines As a result even the better-performing small engines emit far greater quantities of pollutants per hour than typical modern car engines For example the US Environmental Protection Agency (USEPA) 2002 limit for a typical 4 kilowatt (kW) lawnmower motor is about 66 grams (g) of regulated pollutants per hour of operation A typical 08kW brushcutter sold new in 2002 emitted about 160grams of pollutants per hour - reducing to 40grams per hour if bought new in 2006 The equivalent limit for cars under Australian Design Rule 79 is about 16g per hour In other words operated over a similar time one hour of operation of a brushcutter that meets USEPA 2002 limits produces the same pollution as ten cars and a 4kW lawnmower the same pollution as four cars These comparisons are subject to differences in test methods but they do provide an indication of the disproportionate amount of pollution emitted by small engines

Engines that do not comply with current USEPA requirements are likely to emit several times the amount of pollution calculated in the above example Therefore the worst performing engines are likely to emit some ten times the emissions of the best performers

Because of the combustion of oil these engines also emit high levels of particles Although small engines only contribute a small amount to total particle emissions the rate of particle release compared to other engines can be very high For example lawnmowers can emit over 10 times more particles (in terms of grams per hour) than a petrol motor vehicle (manufactured between 1994 and 2001)

All the above emission comparisons between outdoor garden equipment engines and motor vehicles are subject to differences in test methods but they indicate the disproportionate amount of pollution emitted by small garden equipment engines It also needs to be recognised that motor vehicles in Australia average more than 15000 kilometres per year (ABS 2003) while the annual average use of outdoor garden equipment is around 25 hours for a lawnmower and less for other types of equipment Commercial operators however are likely to have a much higher usage rates than the general public

2

This paper examines the Australian market for small engines used in lawnmowers and handheld garden equipment their impact on air quality relevant overseas regulations and their applicability to Australia and makes recommendations to reduce air quality impacts from these engines

A wide range of information sources has been referenced for this report including data and information supplied by manufacturers distributors and dealers in small engines

3

2 Air Quality and Outdoor Garden Equipment Engines

Emission inventories make estimates of emissions of substances from a multitude of sources into airsheds The National Pollutant Inventory (NPI) which is run cooperatively by the Australian state and territory governments contains data on 90 substances that are emitted to the Australian environment The substances included in the NPI have been identified as important because of their possible health and environmental effects Industry facilities estimate their own emissions annually and report to states and territories Non-industry (or diffuse) emissions estimates which includes emissions from outdoor garden equipment are made by the states and territories on a periodic basis using information sources such as surveys databases and sales figures

The NPI only reports emissions from domestic lawn mowing and for a few airsheds the contribution made by public open space lawn mowing It does not report on the contribution made by other types of outdoor garden equipment such as brushcutters National and selected state NPI emissions estimates for the common air pollutants and for Air Toxics NEPM pollutants from domestic lawn mowing are summarised in Table 1 It should be noted that national emissions from lawn mowing are underestimates as the NPI records emissions for major airsheds only and therefore is not Australia wide plus the estimates do not include evaporative emissions from fuel tanks and hoses

This NPI data is indicative only as the accuracy and completeness of the data sets varies across airsheds and is reliant on the estimation techniques used For example while the population in the NSW is higher than other airsheds its emissions look disproportionally high when compared to the other airsheds This could be because the estimation technique varies or it is due to some other factor

4

Table 1 National Pollutant Inventory Domestic Lawn Mowing Emission Estimates

Substance Port Phillip

Population 34 mill (1996)

SE Qld

Population 23 mill

NSW GMR

Population 47 mill

Adelaide

Population 10 mill

National

Common Air Pollutants (tonnesyear)

Carbon monoxide 12000 12000 24000 6100 69000

Total Volatile Organic Compounds 3600 3800 7000 2000 21000

Particulate Matter 100 um 86 94 170 9 460

Sulphur dioxide 5 5 9 50 81

Oxides of Nitrogen 63 54 120 24 330

Air Toxics (tonnesyear)

Benzene 230 210 390 130 1200

Formaldehyde 56 38 NA 31 180

Polycyclic aromatic hydrocarbons 07 11 21 04 41

Toluene (methylbenzene) 370 360 660 210 2000

Xylenes (individual or mixed isomers) 270 260 490 150 1500

Analysis of the NPI database at the national level shows that domestic lawn mowing is the

- Fourth largest source of benzene contributing 7 to the total reported airshed load

- Fourth largest source of formaldehyde contributing 3 to the total reported airshed load

- Fifth largest source of xylene contributing 6 to the total reported airshed load

- Fifth largest source of toluene contributing 6 to the total reported airshed load

- Sixth largest source of carbon monoxide contributing 12 to the total reported airshed load

- Ninth largest source of VOCs contributing 3 to the total reported airshed load when biogenics (natural sources such as trees and soil) are excluded

The NSW Department of Environment and Conservation has been upgrading its emissions inventory Based on 2003 emissions data non-road anthropogenic sources

5

contribute 619 of the VOCs to the GMR airshed Preliminary results2 indicate that VOC emissions from domestic and public open space lawn mowing contributes on an annual average 41 of all VOC emissions in the GMR On a typical weekend during warmer weather this percentage rises to 11

Therefore it could be assumed that lawn mowing could contribute approximately 4 on average to VOC emissions from anthropogenic sources in major airsheds in Australia when public open space lawn mowing is included This percentage is likely to rise significantly in the warmer spring and autumn weekends which is when lawns and other vegetation grow faster and when more people garden

21 Air Quality Standards

In June 1998 the National Environment Protection Measure for Ambient Air (Air NEPM) established national uniform standards for ambient air quality for the six most common air pollutants ndash carbon monoxide nitrogen dioxide photochemical oxidants (measured as ozone) sulfur dioxide lead and particles less than 10 microns (PM10) The NEPM was varied in 2003 to include PM25 advisory reporting standards and in April 2004 a National Environment Protection Measure for Air Toxics was adopted

Nationally the common pollutants of most concern (particularly in major urban areas) are fine particles and ground level photochemical smog (measured as ozone) which is formed in the warmer months when volatile organic compounds (VOCs) and oxides of nitrogen (NOx) react in the atmosphere under the influence of sunlight in a series of chemical reactions

Recent health studies (cited in NEPC 2005) have strengthened the evidence that there are short-term ozone effects on mortality and respiratory disease The studies also strengthen the view that there does not appear to be a threshold for ozone below which no effects on health are expected to occur In recent years Australian epidemiological studies have been conducted which confirm the results of overseas studies that there is a relationship between elevated ozone levels and hospitalisations and deaths from certain conditions

There are two national ozone standards a one hour standard of 010ppm and a four hour standard of 008ppm with a goal that allows for one exceedance per year by 2008 Sydney experiences a number of days each year of ozone levels above these standards In 2003 Sydney exceeded the one hour standard on 11 days in 2003 19 days in 2004 and 9 days in 2005 The four hour standard was exceeded on 13 days in 2003 19 days in 2004 and 13 days in 2005 Further reductions in VOC and NOx emissions are needed to reduce ozone concentrations in Sydney to levels that would comply with the Air NEPM

The other jurisdictions meet or are close to meeting the current National Environment Protection (Ambient Air Quality) Measure (Air NEPM) ozone standards (NEPC 2005) However the ozone standards are being reviewed and based on current human health evidence the argument appears to be strengthening for tighter ozone standards

2 Presentation to Expert Panel 27 April 2006 by Nick Agipades Manager Major Air Projects NSW DEC

6

Should a stricter standard or an eight-hour standard consistent with international standardsguidelines be adopted achievability of Air NEPM ozone standards or goals could become an issue for some of the other major urban airsheds (NEPC 2005)

Modeling of ozone for Sydneyrsquos Greater Metropolitan Region (GMR) indicates that the implementation of Euro emission limits for on-road vehicles and hence the increased presence of these less polluting vehicles in the fleet and retirement of old more polluting vehicles from the fleet is not sufficient to meet the current NEPM goals Modeling suggests that very large reductions in precursor emissions would be required to meet the current ozone one hour goal (NEPC 2005)

Even when the effects of bushfires and when hazard reduction burning are taken into consideration airsheds such as Launceston Melbourne and Sydney struggle to meet the national standards for particles (EPA 2006) However outdoor powered equipment predominantly from two stroke engines makes only a minor contribution to ambient fine particle loads

While carbon monoxide emissions from engines used in outdoor garden equipment are regulated overseas air monitoring in Australia indicates that carbon monoxides levels are well below the national air quality standards and there are no pressing issues requiring CO from outdoor powered equipment to be regulated In addition data indicates that lowering emissions of VOCs and NOx from small engines reduces CO emissions

Many of the pollutant sources which contribute to the formation of ozone and to particle levels also contain air toxics such as benzene toluene formaldehyde and xylenes These air toxics have been shown to be responsible for a range of health problems including asthma respiratory illnesses and cancer The National Environment Protection Measure for Air Toxics requires each jurisdiction to monitor and report annually on five air toxics benzene polycyclic aromatic hydrocarbons formaldehyde toluene and xylenes The monitoring data is intended to inform future policy and also the public on ambient levels of these air pollutants Monitoring of air toxics to date shows that levels are low and below the national monitoring investigation levels (EPA Vic 2006 DEC 2006)

7

3 Emission Standards for Small Engines

31 Australia

At present there are no Australian regulations or standards to limit air pollutant emissions from small (two and four stroke) engines Australia does benefit to some extent from overseas regulations as many lawnmowers and other gardening equipment sold in Australia have engines manufactured in the United States or Europe where strict standards apply

32 United States

In the United States emission regulations set by the United States Environmental Protection Agency (USEPA) and the Californian Air Resources Board (CARB) apply to lawn mowers and other powered gardening equipment Although CARB standards currently tend to be stricter than USEPA standards by 2006 emissions limits applying under the two standards will be very similar

United States Environment Protection Agency (US EPA)

In 1995 the USEPA introduced ldquoPhase 1rdquo regulations covering small non-road engines with a power of not more than 19kW (25HP) The regulations applied to equipment manufactured from 1997

These regulations have seven classes of equipment based on portability and engine displacement volume (ldquocapacityrdquo) In March 2000 the USEPA published ldquoPhase 2rdquo regulations which are shown in Table 2 These set limits for combined emissions of hydrocarbons (HC) and oxides of nitrogen (NOx) and separate limits for carbon monoxide (CO) emissions and for two stroke engines only particles

Table 2 US EPA Phase 2 Small Engine Emissions Standards (HC+NOx in gkW-hr) (a) (b)

Small Engine Class

Type 2002 2003 2004 2005 2006 2007+

I-A (lt66cc) Non-handheld (eg lawnmowers)

- 161 161 161 161 161

I-B (66 to lt 100cc) - 161 161 161 161 161

I (100 to lt 225cc) - 161 161 161 161 161

II (225cc or more) 180 166 150 136 121 121

III (lt20cc) Handheld (eg trimmers)

238 175 113 50 50 50

IV (20 to lt50cc) 196 148 99 50 50 50

V (50cc or more) - - 143 119 96 72 (a) As carbon monoxide (CO) levels in Australia are well below the Air NEPM standard the

USEPA emission limits for CO have not been included in this table (b) Includes useful life criteria of 50125300 hours

8

When the USEPA introduced ldquoPhase 2rdquo regulations it included averaging banking and trading provisions (ABT) which were seen ldquoas an important element in making stringent Phase 2 emissions standards achievable with regard to technological feasibility lead time and costrdquo (USA 1999) The USEPA also claimed (USA 2000) that the ABT program secures early emissions benefits through the early introduction of cleaner engines

ABT provisions which apply to handheld and non handheld engines are complex but in broad terms averaging means the exchange of emission credits among engine families within a given engine manufacturerrsquos product line This allows a manufacturer to produce some engines that exceed the standards and offsetting these exceedances with emissions from engines that are below the standard Manufacturers are allowed to exchange credits from handheld to non handheld and vice versa Banking means the retention of emission credits by the engine manufacturer generating the credits for use in a future model year (for averaging or trading) Trading is the exchange of emission credits between engine manufacturers which then can be used for averaging purposes banked for future use or traded to another engine manufacturer

In January 2004 USEPA reported that in 2002 averaging was being used but there was very little use of banking It determined that the initial ABT programs as too complex and included discount rates on credits ABT was simplified in 2004 including the elimination of credit discount and multipliers and limits on credit life To date there has reportedly been limited use of banking however it is anticipated that there will be more widespread use of banking credits if the USEPA proposed Phase 3 comes into effect3 (see below)

Particulate limits (2gkW-hr) also apply to two stroke engines Carbon monoxide and durability limits (or useful life) are also prescribed The durability criteria which were introduced in Phase 2 require that the emission limits must be met through the useful life of the engine The manufacturer determines useful life of each product using standardised product testing procedures and then based on the test results selects the useful life category for each product which can be 125 250 or 500 hours These durability criteria acknowledge the large disparity in usage patterns by equipment type and between commercial and residential users It also takes into account the ability of manufacturers to design and build engines for various design lives and which fit the types of equipment engine is produced for

The March 2000 USEPA report (USEPA 2000) estimated that the expected effects of the Phase 2 regulations would be

bull A 70 reduction in HC+NOx beyond the Phase I standards (which were estimated to have reduced emissions by 32 from the unregulated baseline)

bull A 30 reduction in fuel consumption of small handheld equipment bull Price increases of between $US23 (Class III) and $US56 (Class V) for

handheld equipment

3 Dave Gardner Briggs and Stratton email 22506

9

The US EPA is currently considering lsquoPhase 3rsquo regulations which are catalyst based standards to further reduce exhaust HC and NOx emissions from non handheld engines reduce evaporative HC and NOx emissions for both handheld and non handheld engines plus include extended durability criteria These limits are currently at discussion stage only They align with CARB Tier 3 but a longer lead time is proposed

Table 3 Proposed Phase 3 Exhaust Emissions

HC+NOx gkW-hr

CO gkW-hr

Year Useful life hrs

Class I 100 610 2010 125250500

Class II 80 610 2011 2505001000

Class III-V No changes

HC+NOx std is based on averaging

Californian Air Resources Board (CARB)

Spark ignition engines

CARB regulations first introduced emission limits for small engines manufactured from1995 The more recent schedule of emission limits are shown in Table 4 These limits depend solely on the engine capacity and apply to both handheld and non handheld classes

Table 4 CARB Emission Limits for Small Engines (HC+NOx in gkw-hr)

Engine Capacity 2000-2001 2002-2005 2006+

65cc or less 72 72 72

gt65cc to 225cc 161 161 161

gt225cc 134 121 121

California has particle limits for two strokes useful life criteria and mandatory engine labeling including a consumer advisory hang tag as shown in Figure 1 The USEPA is also considering introducing an air index label

10

Figure 1 Example of a Californian Consumer Advisory Hang Tag The Californian regulations take into account sales weighted emission performance for families of engines An engine family is essentially the same engine being used in different equipment items

In 2003 California adopted a Tier 3 program for exhaust and evaporative emissions and these are based on the use of catalytic convertors The engine classes better align with US EPA categories however the exhaust standards for Class I and Class II are more stringent than the existing US EPA standards

Table 5 CARB Tier 3 for Exhaust Emissions

Model Year Displacement Category

Durability Periods (hours)

HC+NOx gkw-hr

CO gkw-hr

Particulate gkw-hr

2005 and subsequent

lt50 cc 50125300 50 536 20 + 50-80 cc inclusive 50125300 72 536 20 +

2005 gt80 cc - lt225 cc Horizontal-shaft eng

125250500 161 549

gt80 cc - lt225 cc NA 161 467 Vertical-shaft Engine 225 cc 125250500 121 549

2006 gt80 cc - lt225 cc 125250500 161 549 225 cc 125250500 121 549

2007 gt80 cc - lt225 cc 125250500 100 549 225 cc 125250500 121 549

2008 and subsequent

gt80 cc - lt225 cc 125250500 100 549 225 cc 1252505001000 80 549

the 1000 hours is applicable for 2008+ Model Year (MY) + applies to 2 stroke only Source California Exhaust Emission Standards and Test Procedures For 2005 And Later Small Off-Road Engines Adopted July 26 2004 effective on October 20 2004

California also has Blue Sky provisions These are voluntary standards for engines that meet the criteria shown in Table 6 Blue Sky Series engines are not included in

11

the averaging banking and trading program Zero-emission small off-road equipment (eg push mowers) may certify to the Blue Sky Series emission standards

In 2005 CARB aligned its test procedures with the USEPA

Table 6 CARB Blue Sky Provisions

Model Year Displacement Category

HC+NOx gkw-hr

CO gkw-hr

Particulate

2005 and subsequent lt50 cc 25 536 20

50 - 80 cc inclusive 36 536 20

2007 and subsequent gt80 cc - lt225 cc 50 549

2008 and subsequent 225 cc 40 549 Applicable to all two stroke engines

33 Canada

The Canadian small engine market has similarities to the Australia market the majority of small engines are imported from the USA and there is one Canadian manufacturer of small spark ignition engines and one major manufacturer of lawn and garden machines

A Memorandum of Understanding (MOU) which came into effect on 1 January 2000 was signed between Environment Canada and ten manufacturers of handheld equipment and nine manufacturers of engines used in non handheld machines The MOU was intended as an interim measure until regulations could be put in place Under the MOU the manufacturers agreed to voluntarily supply small spark ignition engines designed to meet the applicable USEPA Phase 1 emission standards

In 2003 Canada regulated emission limits for handheld and non-handheld small engines based on USEPA emission limits The regulations apply to model years 2005 and later While there are no separate averaging banking and trading provisions in Canadian regulations Canada allows any USEPA certified engine to be sold in Canada This means that engines that do not meet the standard level but are averaged (or use credits) in the United States can be sold in Canada Manufacturers are required to produce upon request evidence of conformity to the standards and are required to provide written instructions on engine maintenance to the first retailer

12

Table 7 Canadian Small Spark-Ignition Engine Exhaust Emission Standards

Engine class

Engine Type

Engine Displacement (cm3)

Effective date (model year)

Standard HC+NOx (gkWshyhr)

Standard NMHC+NOx (gkW-hr)

Standard CO (gkWshyhr)

I-A Non-handheld lt66 2005 and

later 50a -shy 610a

I-B Non-handheld

lt100 and 66

2005 and later

40a 37a 610a

I Non-handheld

lt225 and 100

2005r 161b 148a 519b 610a

II Non-handheld 225 2005 and

later 121a 113a 610a

III Handheld 20 2005 and later 50a -shy 805a

IV Handheld lt50 and 20 2005 and later

50a -shy 805a

V Handheld 50 2005 2006 2007 and later

119a 96a

72a

-shy-shy

-shy

603a 603a

603a a Standards apply throughout the engine useful life b Standards apply only when the engine is new Source Canada Gazette Part II Vol 137 No 24 2003-11-19

34 Europe

In 1998 the European Union introduced exhaust emission limits for small petrol engines through Directive 9768EC and in 2002 introduced amendments through Directive 200288EC The limits in the Directives align with the US regulations however they do not have averaging and banking provisions

Table 8 European Emissions Standards

Small Engine Class Type (HC+NOx in gkW-hr) 2004 2005 2006 2007 2008

SN1 (lt66cc) Non-handheld (eg lawn mowers)

161 161 161 161 161

SN2 (66 to lt 100cc) 161 161 161 161 161

SN3 (100 to lt 225cc) - - - 161 161

SN4 (225cc or more) - - 121 121 121

SH1 (lt20cc) Handheld (eg trimmers)

- - - 50 50

SH2 (20 to lt50cc) - - - 50 50

SH3 (50cc or more) - - - - 72

13

The European Union is currently considering including useful life criteria and averaging and banking provisions plus it is considering introducing a Directive to further reduce emissions from diesel engines The objective of the proposal is to tighten emissions standards for engines in general non-road applications in light of technological developments and it taking into account the parallel developments for similar legislation in the United States in order to harmonise the environmental standards and to facilitate trade

Charts comparing the USA Californian and European Emission Limits are shown below

14

35 Summary of Regulations for Non Handheld Equipment

KEY TO CHARTS

USEPA CARB EU

0

10

20

30

40

50

60

70

80

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

0 to 49cc

0

10

20

30

40

50

60

70

80

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

50 to 65cc

0

2

4

6

8

10

12

14

16

18

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

100 to 224cc

0

2

4

6

8

10

12

14

16

18

20

2000

2002

2004

2006

2008

Year Model

HC

+N

Ox g

kW

-hr

225cc and over (up to 19kW)

15

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

36 Summary of Regulations for Handheld Equipment

KEY TO CHARTS

USEPA CARB EU

20 to 49cc 0 to 19cc

250 250

200

150

HC

+N

Ox g

kW

-hr

100

200

HC

+N

Ox g

kW

-hr

150

100

50 50

0 0

Year Model Year Model

50 to 65cc 66 to 80cc

160

160

140

140

120

40 40

20 20

0 0

120

HC

+N

Ox g

kW

-hr

HC

+N

Ox g

kW

-hr

100100

8080

60 60

Year Model Year Model

16

Summary of Regulations for Handheld Equipment (continued)

KEY TO CHARTS

USEPA CARB EU

0

20

40

60

80

100

120

140

160

2000

2001

2002

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

81 to 224cc

0

20

40

60

80

100

120

140

160

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

225cc and over (up to 19kW)

17

4 Australian Market for Small Engines

41 Likely compliance with overseas emissions standards

As part of this assessment an environmental profile of equipment currently on the Australian market has been developed initially based on information from manufacturersrsquo brochures and web sites and industry magazines and then confirmed through follow-up with relevant industry contacts

Each item of equipment has been assessed on its compliance with USEPA CARB or European regulations In most cases it was not possible to match models available on the Australian market with CARB lists (CARB publishes exhaust emissions data on all appliances on its web site) This was mainly due to the inconsistency of model designations and uncertainty about ldquoengine familiesrdquo

Engine characteristics and retail price were difficult to obtain Some brochures also made claims of compliance with USEPA European or CARB requirements The detailed breakdown of current equipment on the Australian market is given in Appendix 1

The majority of small engines sold in Australia are imported and many come from countries that impose emission limits The extent of imports into Australia that do not comply with the country of origin standards is not known Industry estimates that 40 of garden products are sold through importers who are not linked to manufacturers of US EPA or European certified equipment and the source of some products sold here is difficult to establish Victa is the only company producing small engines in Australia Its iconic 2-stroke lawnmower currently cannot meet overseas emission limits

Outdoor Power Equipment Association (OPEA) assisted in identifying the Australian distributors of most brands of powered garden equipment In April 2006 a survey form was sent to a total of 43 distributors representing 97 brands of equipment The survey form sought information about the engine for all petrol-fuelled garden equipment with a power not more than 19kW

Figure 2 Extract from survey form

18

Initial response to the survey was poor Despite follow-up action and efforts from the industry association at the beginning of September 2006 26 distributors had responded to the survey information and only 13 distributors provided all data necessary for benchmarking purposes This resulted in emission compliance data for about half of the estimated products on the Australian market Attempts to match Australian models with the database maintained by the Californian Air Resources Board were also of limited success due to inconsistencies in model designations between Australia and the USA and the manner in which model information is coded in the CARB database

Table 9 Summary of distributor responses

Responses status Not OPEA OPEA ALL

Number of responses 9 8 (31) 17 (40)

Response - all data 4 9 13 (30)

Response - extra time sought 3 3 (7)

Response - no petrol products 4 1 5 (12)

Response - some data 5 5 (12)

Grand Total 17 26 43 percentages may not add to 100 due to rounding

Of the 97 brands initially identified

bull 16 brands are apparently no longer sold in Australia

bull No responses were received for 29 brands

bull Partial data were received for 12 brands

bull All data was available for 30 brands

Table 10 Summary of responses by brand

Count of brands

Analysis status Not OPEA OPEA All

Missing some data 12 12

No data received 9 (27) 20 (31) 29 (30)

No longer sold 13 3 16

Response - no models to list 3 7 10

Response received (electronic form) 5 11 16

Response received (paper form) 3 2 5

Response received (spreadsheet) 9 9

All 33 64 97

A 2004 report for the NSW DEC estimated that there were about 1200 eligible garden

19

products in the Australian market The current project has obtained data for a total of 870 products or 72 of the estimated population In addition the sampling method is likely to be biased towards products with good environmental performance In these circumstances the following analysis should be regarded as indicative only

Survey results

The following tables and figures show expected compliance with European CARB or USEPA requirements based on the limited information provided by industry

Table 11 Engine type and compliance with overseas standards Count of products Engine type

Best STD 2c 4c Unknown All 1997 - US EPA I 53 32 85 (10) 200288EU 17 17 (2) 2004 - US EPA II 1 3 4 (lt1) 2004 EURO I 8 8 (1) 2005 - US EPA II 10 29 5 44 (5) 2006 - US EPA II 107 141 2 250 (29) 2006 EURO I 6 6 (1) 2007 - US EPA II 1 1 (lt1) 2007 Euro II 2 2 (lt1) None 118 90 208 (24 Unspecified 24 60 161 245 (28) All 344 358 168 870

Unknown means the type of engine is unknown (but is most likely to be 2c) Unspecified means that the status of emissions compliance was unable to be identified None means the manufacturerdistributor has indicated that the equipment does not comply with any overseas emissions standard

Figure 3 Compliance with overseas standards - all surveyed products Note Unknown in chart includes unspecified and unknown from Table 11

20

Figure 4 Compliance with overseas standards by equipment type ldquoPhase 1 equivrdquo means the engine complies with US EPA phase 1 or 200288EU ldquoPhase 2 equivrdquo means the engine complies with US EPA Phase 2 Euro I or Euro 2 ldquoUnknown means that engine cycle (stroke) was not provided

Of the 41 categories of equipment in the survey 15 had at least 10 current products Results for these categories are set out below

Figure 5 Engine type for popular categories

21

Figure 6 Compliance with overseas standards for popular categories ldquoPhase 1 equiv means the engine complies with US EPA phase 1 or 200288EU Phase 2 equiv means the engine complies with US EPA Phase 2 Euro I or Euro 2 ldquoUnknown means that engine cycle (stroke) was not provided

42 Australian Sales of Outdoor Powered Equipment

The Australian Outdoor Power Equipment Association (OPEA) whose membership represents about 80 of the manufacturersdistributors and dealers in the industry commissions regular independent industry audits of garden equipment sales (OPEA personal communications) Sales data from OPEA is shown in Table 12

22

Table 12 Sales of outdoor garden equipment 2002 and 2005-06 2005-06 2 stroke (1000)

2002 2 stroke (1000)

2005-06 4 stroke (1000)

2002 4 stroke (1000)

2005-06 TOTAL (1000)

2002 TOTAL (1000)

Walk behind mowers 72 170 351 76 424 246

Brushcuttertrimmer 321 12 17 180 339 192

Chainsaws 152 0 0 90 152 90

Chipper shredders 0 60 46 0 46 60

Blowerblower vacuums 98 0 11 50 109 50

Ride on mowers 0 25 51 0 51 25

Generators 11 32 96 0 107 32

Hedge trimmers ampothers 40 192 0 28 40 220

694 491 476 424 1267 915

for total sales 593 463 407 537

for mowers 152 280 848 720

According to OPEA approximately 424000 walk behind lawnmowers and more than 792000 units of outdoor handheld equipment were sold in Australia in 2005-06 In addition there were sales of about 80000 replacement engines and 70000 pumps in 2005-06 most of which were four strokes These figures show that there has been considerable growth in the sales of most products with the exception of chipper shredders and the category lsquohedge trimmers and othersrsquo whose sales declined in 2005shy06 compared with those in 2002 About 17 of walk behind lawnmowers were two stroke and 83 four stroke which is an improvement in the uptake of cleaner engines when compared to 2002 when about 30 were two stroke The situation with handheld equipment is reverse with nearly 79 being two strokes compared to 47 in 2002 However many models of two stroke handheld equipment meet current US emission standards and care should be exercised in using engine type (two stroke or four stroke) as an indicator of emissions performance for this class of equipment

The OPEA 2005-06 sales estimates are shown in Figure 7 OPEA cautions that there is considerable uncertainty about the estimates for brushcutters and blowerblower vacuums as OPEArsquos figures only represent 50 and 60 respectively of sales of these products No estimates of future sales trends were identified during research for this project

23

Australian sales of 2 and 4 stroke outdoor equipment 2005-6

0 50 100 150 200 250 300 350 400

Walk behind mowers

Brushcuttertrimmer

Chainsaws

Chipper shredders

Blowerblower vacuums

Ride on mowers

Generators

Other

Annual sales (x 1000)

4s 2s

Figure 7 OPEA estimates of equipment sales in 2005-06 Note Blowervac is an industry term for equipment that combines blowing and vacuuming functions

Briggs and Stratton (Australia) who import engines from the USA supply the majority of the four stroke engines for handheld equipment sold in Australia and these comply with all the current USA and CARB regulations Imported handheld garden equipment is shipped fully assembled to a branch or distributor and is then sent to a retailer The retailer may or may not provide equipment servicing

OPEA members have expressed concern regarding the increasing sales of imported high polluting two stroke engines that allegedly do not meet any emission standards and come from countries that do not have emission standards One industry representative reported that some of the imported trimmers were being manufactured in China using outdated designs and tooling from two old bankrupt American companies and these are being sold here at about 30 of the price of traditional brands and very low cost generators from China now account for around 70 of total sales It is difficult to confirm this trend without undertaking a detailed examination of Australian import data however the significant increase in the sales of two stroke handheld equipment provides some support for this trend

On the other hand it is claimed by industry that the ride on mower market (predominately with compliant four stroke engines) has been stimulated by the Australian USA free trade agreement

24

5 Australian Users of Small Engines This section examines the market segments for garden equipment and customer purchasing behaviour

51 General Public

Purchasing behaviour

Research into consumer purchasing behaviour has found that consumers assess a product against a range of attributes for example price weight brand reputation servicing and parts availability warrantees and guarantees experience size promotions and discounts Studies have also revealed that up to 82 of Australians had bought products on the basis of social or environmental factors in the previous year (State Chamber of Commerce 2001) Related to this point the energy star rating ecolabel on whitegoods was viewed as a credible environmental claims system which is well regarded by the general consumer (Product Category Manager Mitre 10 personal communications)

As the purchase of small engine garden equipment by the general consumer is an infrequent purchase which carries a certain of amount of risk With small engines the risk can be functional risk (will not perform as expected) physical risk (for example safe features such automatic cut out on an electric lawn mower) or financial risk especially for the more expensive items The general consumer is likely to lessen the risk by seeking information and by evaluating the information on the available products over a period of time The consumer may also lessen the risk by

bull purchasing well known brands

bull buying the brand offering the best warrantees and guarantees

bull buying the most expensive brand and

bull buying a brand they have used before

Research indicates that the desired attributes of a product may not be well established at the start of a consumerrsquos search process but will often be refined as the consumer learns more about the product The consumer will also use a ranking and weighting process based on desired qualities and trade offs may be made

Reportedly purchases of engine operated garden equipment are based on price yard size fitness for purpose and other features such as weight and ease of starting (Product Category Manager Mitre 10 personal communications) Males are the predominant purchasers of garden equipment however because of changing demographics there has been an increase in the number of women purchasing these products

Less than 5 of lawnmowers purchased are push or electric mowers (Product Category Manager Mitre 10 and industry sources personal communications 2003)

25

Electric mowers are generally perceived as not being as effective as cords have limited range and rechargeable electric mowers require frequent recharging

There is a recent trend towards ride on mowers (all four strokes) probably because of changing demographics specifically older age groups moving to more rural environments with larger yards (OPEA personal communications)

A study (Wilkie 1994) investigated consumer appliance purchasing behaviour and found that the general consumer consulted a range of information sources before purchasing an appliance The appliance salesperson was found to be the most important information source for many consumers Other important information sources include newspaper advertisements friends and relatives catalogues consumer reports and brochureslabels Since Wilkiersquos study the internet will have become increasingly important as a research tool and in some instances as a way to purchase products As part of this study there is evidence of low priced products being sold into the Australian market via the internet only ndash a practice that is likely to increase in the future It was difficult to source any compliance or details on these products

At the retail chain level staff product training is generally voluntary undertaken out of store hours and as an inducement to attend training sessions suppliers usually provide incentives for staff Retail chain purchases are very price driven although some chains are reportedly interested in stocking goods that have credible environmental claims (Mitre 10 and other retail chain sources)

IBIS (2006a) reports that the domestic hardware sector which is dominated by Danks (Home Timber and Hardware Thrifty - Link Hardware and Plants Plus Garden Centre) and Bunnings is classified as a growth market and the sales of lawnmowers and other lawn and garden machinery and equipment represent about 14 of sales revenue

In summary it appears that a range of product attributes influences consumer purchases of lawnmowers and outdoor equipment Currently there is very little information about emissions in any of the information sources a consumer is likely to consult when purchasing these products Nevertheless surveys indicate that consumers are concerned about the environment and are open to including environmental considerations into their purchase decision Educating sales staff about the air emissions from lawnmowers and outdoor equipment together with ecolabels could therefore be important methods for influencing consumers towards the purchase of cleaner products

Equipment Usage

The USA Outdoor Power Equipment Institute CARB (cited in USEPA 1998) and the USEPA (USEPA 1998) have made estimates of annual usage rates and average life spans of outdoor equipment for the general consumer user and for the commercial user Table 13 gives USA usage and lifespan range for selected items of powered equipment

26

Table 13 USA Average Usage and Lifespan of Outdoor Garden Equipment For General Consumers and Commercial Users Equipment Annual usage (Hours) Lifespan (years)

General Consumer

Walk- behind mowers 20-25 6 -7

Rear engine ride on mowers 4 6 -7

Chainsaws 7 5-9

Leaf blowers 9-12 5-9

Trimmers 10 5-9

Commercial User

Walk- behind mowers 320 27

Rear engine ride on mowers 380 38

Chainsaws 405 1-13

Leaf blowers 170-293 18-28

Trimmers 170 - 275 15-28

Discussions with members of the Australian industry confirm that Australian hours of use are likely to be similar to the American estimates although this can vary depending on location For example in tropical areas lawns are mowed more often because they grow faster in this climate The American turnover of equipment is however probably higher than here as the Australian consumer tends to keep their equipment longer and so the useful life of a mower is more likely to be on average 10 ndash12 years

52 Garden and Ground Maintenance Services

According to a recent IBIS report (2006b) the revenue for this industry in 2005-06 was $383 million and the industry outlook is lsquobrightrsquo with a predicted annual average 5 growth over the next few years The Australian customer base for garden maintenance services including for lawn mowing is

Households 55 Business 25 Government 20

The sector is reportedly a growth industry due to

bull the aging population

bull the increasing numbers of households that are time poor income rich and

bull the growing trend for professional landscaping which requires a higher level of garden maintenance

27

The main customer base for these businesses includes middle to upper socioeconomic groups the aged and people who are physically disabled Growth is predicted particularly for the franchise industry with demand from the commercialindustrialgovernment sectors (IBIS 2003) A 1999 ABS survey reported that nearly one-third of older people purchased at least one domestic service per fortnight with gardening assistance being the most common This accords with an industry estimate that about 25 of householders pay someone to mow their lawn (Jim Penman Jimrsquos Mowing personal communication) The industry is sensitive to economic conditions and weather for example the drought has slowed growth over the last few years

The garden maintenance sector is dominated by small independent operators with two major franchisers Jimrsquos Mowing and VIP VIP nationally has 600 franchises and Jimrsquos Mowing about 400 Jimrsquos Mowing reportedly mows about 15000 lawns and has 53 of the market (IBIS 2006b) As franchised lawn mowing services represents about 14 of the lawn mowing services nationally it can be estimated that approximately 280000 lawns are mowed nationally by commercial operators

Jimrsquos Mowing and VIP provide training and advice to new franchisees on equipment including proper maintenance schedules Training generally occurs before franchisees purchase their equipment Most franchisees equipment would consist of two mowers a brushcutter an air blower and possibly a hedge trimmer or chain saw Operators prefer four stroke mowers and these are used for an average eight hours per week Brushcutters are generally two strokes as are other motors (IBIS 2006b and Jim Penman personal communication)

From the above it is estimated commercial operators operate mowers for up 34 million hours per year (or 8 of the total estimated mowing hours per year) and purchase approximately 66000 lawnmowers annually (25 of purchases) The sectorrsquos purchases of brushcutters is estimated to be approximately 8000 units per year or 37 of purchases Table 13 provides US commercial userrsquos annual average hours of use and average equipment life spans ndash it would be anticipated Australian rates would be similar

The main businesses contracting to provide ground maintenance services to the corporate and government sector (including universities) are Spotlessrsquos Open Space Management Transfield and Programmed Maintenance Services all of which are diversified publicly listed companies plus the Danish owned company ISS (previously Tempo Services) (IBIS 2003 and 2006b and company websites) The type of services they provide means it is likely they would have an array of equipment and a preference for the more powerful ride-on mowers and for Class V handheld equipment

53 Government Purchasing

The way purchasing decisions are made by government or other large organizations is generally very different to the approach taken by the general household consumer

bull many of the purchases are for large quantities of goods

28

bull there are well established policies and procedures in place to guide purchasing with the purchase criteria established early in the buying process and

bull those making the purchase are likely to be more knowledgeable about the product than the average consumer and they are usually not the eventual user of the goods

Value for money fitness for purpose ability to supply and over recent years environmental aspects are likely to be important factors in the purchasing decision for Government

Local State and Commonwealth Governments have responsibility for the upkeep of public assets many of which include public open space and other outdoors areas At the State and Federal level these include schools universities sporting facilities hospitals and defence facilities These services may be outsourced individual departments may undertake maintenance and purchase their own equipment or they may purchase equipment through a central purchasing facility With the central purchasing facility these items are generally purchased under contract While there is an increase in the inclusion of environmental considerations in the selection criteria for purchasing goods and services especially under contract these considerations mainly relate to waste management and recycling criteria and not air emissions

Local councils in some states for example NSW generally take responsibility for ground maintenance within their council areas or for some smaller councils the service may be contracted to a neighbouring council In other states such as Victoria there is a trend to outsource ground maintenance contracts to commercial providers

It is unknown what proportion of total sales that direct Government purchases represent however it likely to represent a relatively small share of several percent of the overall market

In summary

bull The general household consumer represents the major market segment for garden equipment accounting for up to 90 of product sales

bull Government is likely to be relatively small direct purchaser of garden equipment

bull Commercial garden services to households purchase approximately 25 of lawnmowers per year and 37 of brushcutters

bull Large ground maintenance companies are likely to prefer larger and more powerful equipment such as ride-on mowers

29

6 Result of Stakeholder Consultation

61 Regulations

The Small Engine Expert Panel ndash Outdoor Equipment considered in depth an approach to take to improve the emissions performance of outdoor garden equipment sold in Australia Discussions were particularly focused on the growing influence of cheap high emissions imported products together with the difficulties that the local manufacturer of lawn mowers is likely to face in complying with the relevant overseas standards As part of this process the industry representatives on the Panel held additional discussions and they consulted international industry experts at the manufacturing level in Europe the USA and Japan

OPEArsquos preference is for the adoption of regulations based on the USEPA standards with Phase 1 being adopted possibly from as early as 2007-08 The industry then proposes that Phase 2 be introduced in 2012 Phase 1 USA EPA standards were adopted in the USA in 1995 to be applied to equipment manufactured from 1997 and Phase 2 standards were introduced in 2002 through to 2007 and these included averaging banking and trading provisions A comparison between the USA Phase 1 and Phase2 standards is given in Table 14 The USEPA is discussing Phase 3 limits for the adoption in 20102011 which includes tighter exhaust emission limits for non-handheld equipment

The emissions limit of the two stroke lawn mower manufactured by the sole Australian manufacturer are well above USA Phase 1 limit for non-handheld equipment One avenue to address this issue which was supported by the Expert Panel ndash Outdoor Equipment would be to place lawn mowers in the US EPA Category 5 (engines gt50cc) This would result in emissions for two stroke lawnmowers being limited to 161 gkW-hour HC + NOx compared to the USA regulated limit of 161 gkW-hour HC + NOx Doing this would align the ramp-up timetable for mowers with that of other garden products

Table 14 Comparison between the USA Phase 1 and Phase 2 standards

Emission Limits GkW-hr

Phase 1 (1997 ndash2001) Phase 2 (2007) HC NOx HC+NOx CO HC+NOx CO

Non-handheld I-A lt66cc 161 610 I-B 66-lt100cc 161 610 I 100-225 cm3 161 519 161 610 II 225 cm3 134 519 121 610 Handheld III lt20 cm3 295 536 805 50 805 IV 20-50 cm3 241 536 805 50 805 V 50 cm3 161 536 603 72 603

Phase 2 limits were phased in between 2002 -2007 during which time they became tighter for simplicity only the 2007 are shown in this table (see Table 2 for more details)

30

In addition to limiting emissions the Expert Panel support the inclusion of the durability criteria which apply in the USA under Phase 2 standards and certification documentation from either the USA or Europe as adequate proof of conformity Equipment that has not been tested and certified to USA or European standards will be required to have the engines tested in a NATA certified laboratory

Some in the industry argued that regulations should include provisions for averaging for companies that wish to use it however they felt banking and trading provisions would not be necessary Industry representatives were not supportive of any Australian consumer labeling requirement instead OPEA members are willing to supply emissions data for inclusion in a web-based database that would allow purchasers to assess the environmental credentials of different makes and models

62 Discussion on recommended regulations

Timing of introduction

Some industry representatives argue that introduction of Phase 1 standards in 2007-08 will not give the industry an adequate transition period in which to develop competence in emissions certification establish new procedures and tooling in the dealers workshops train dealers and technicians on legal requirements distribute specific tooling and spare parts and reduce stocks of old (non certified) products without incurring an undue financial burden While others in the industry prefer progressing straight to phase 2 standards

If the OPEA preference for the adoption of the United States Phase 1 regulations which operated in the USA between 1995 and 2001 were introduced in Australia in 2007-08 they would be well behind the USA standards and worldrsquos best practice Furthermore the introduction of the United States Phase 2 - 2007 limits in Australia in 2012 would if the USEPA introduce Phase 3 in 2010-11 see emission limits for lawnmowers and other non handheld garden equipment in Australia still lagging United States standards and worldrsquos best practice

To introduce regulations in 2007-08 will require Government firstly to determine the most appropriate mechanism under which to enact the regulations draft the regulations prepare the regulatory impact assessment consult with the broader community and then finalise the regulations It is likely an Act of Parliament will be required at the Commonwealth level followed by complementary legislation at the State and Territory level It is possible for this to be achieved in less than a two year timeframe (as was the case for the Water Efficiency Labelling Scheme) However regulations that do not have a level of perceived urgency would take longer The level of importance and urgency to control emissions from small engines has yet to be debated and determined

31

Modified USEPA limits for lawnmowers

From the 183 lawn mowers identified through the market survey Victa is the main (possibly sole) provider of two stroke mowers with the other lawnmowers having cleaner four stroke engines

Victa is undertaking work to produce a cleaner product Victa estimates it would need a number of years to complete development production tooling and commercialisation of the cleaner engines In January 2007 it released a new two stroke carburettor lawnmower that has reduced engine emissions by more 30 but the combined HC and NOx emissions are still above USEPA Phase 1 limits Victa says this new engine is the outcome of four years of collaborative work by Victa and the University of Technology Sydney Victa is continuing with this research to further reduce emissions

A clause that allows exemptions to be granted as occurs in other countries could be included in the regulations however Victa argues that this would create uncertain trading conditions for the company for a period of time until an exemption were granted

Placing lawn mowers in the US EPA Category 5 (engines gt50cc) has the risk of opening the Australian market to more two stroke lawn mowers which has the greatest use of any outdoor powered equipment however it should see the continuance of the sole engine being manufactured in Australia In 1995 when it was introducing small engine emission limits the USEPA faced a similar issue with two stroke lawn mowers and used a similar approach by allowing two stroke lawn mowers to comply with the handheld standards It also specified that the number of two stroke lawnmower engines allowed to meet handheld standards would be subject to a declining annual production cap with the allowance provided by the production cap being phased out in 2003 There is also similar precedent for small engine emission limits that depend on engine type - European regulations for marine outboard motors set less stringent requirements for two stroke motors

Averaging Banking and Trading Provisions

The US EPA did not have averaging banking and trading provisions in Phase 1 and therefore all small outdoor engines were required to meet the Phase 1 limits It only introduced ABT provisions in the much more stringent Phase 2 as they would allow the most economic introduction of cleaner engines The industry claims the systems to use this provision are available and can be implemented in Australia by those who wish to use it at little cost to government

Industry claim that any supportive economic data related to averaging is sensitive and confidential It is there difficult without substantial justification by the industry to support the provision for averaging in conjunction with Phase 1 particularly given the elapsed time between the introduction of Phase 1 in the USA and their recommended introduction in Australia If there are some low volume equipment items that still cannot meet the USAEPA Phase 1 standards then these could be subjected to

32

exemptions if adequate justification can be provided (exemptions for small volumes were available under the USEPA regulations)

It was noted that for government to implement regulations a regulatory impact statement is required and this requires an assessment of the costs and benefits of the options considered with clear overall benefits shown for the preferred option Therefore if the option for manufacturers to use averaging were to be considered more information to support its inclusion would be required

Other options that could be considered to circumvent the inclusion of averaging include

i including clauses that give manufacturers the ability to apply for exemptions from the regulations for classes of equipment that have small sales volumes (these provisions are available in the USA)

ii limiting the regulation to popular types of equipment

iii using the end-of-model life provisions that have been used in the Australian Design Rules for cars In effect the end of model life provisions require new designs to comply from the implementation date but allow older models to remain on sale for a few more years This is an alternative to ABT because it facilitates earlier introduction of the regulation

iv Having a phase in period of say 2 years during which existing models can continue to be sold but new models coming on to the market must comply with the new standards At the end of the phase-in period all models must comply with the new standards This is an approach that is used when Australian Design Rules (ADRs) are introduced for motor vehicles

Consumer Information

Current Australian directions to reduce the environmental impact of consumer products favor tiered benchmarks using a lsquostarrsquo rating system (see Appendix 3 for examples such as the Mandatory Energy Efficiency Label and the Water Efficiency Labelling Scheme)

As products generally arrive in Australia assembled and packaged industry considers a mandatory requirement to label products with an Australian style star rating would impose a cost on distributors that would drive up the retail price of products Instead the OPEA members were willing to supply emissions data for inclusion in a web-based database that would allow purchasers to assess the environmental credentials of different makes and models Given the diverse nature of the industry it is unlikely a database would provide complete coverage of all products on the Australian market but inclusion in the database would indicate that the manufacturer has a commitment to environmental performance It was acknowledged in discussions that at least some Phase 2 compliant products would become available prior to 2012 and the web-based database would provide one method to promote those cleaner engines

33

In summary the Recommendations of the Expert Panel

1 Mandatory air pollutant emission standards to be introduced in Australia for all outdoor equipment (lt19kW) powered by spark-ignition engines The development of any regulation would need to be based on a formal assessment of the costs and benefits of nationally regulating 2 and 4 stroke lawn mowers and handheld power equipment which should be commenced immediately

2 Proposed standards to mirror US EPA regulations (compliance with equivalent EU regulations also acceptable)

3 Timing (subject to completion of assessment of costs and benefits)

(a) US EPA Phase 1 ndash Effective from 2007 2008

(b) US EPA Phase 2 ndash Fully implemented in 2012 (in step with 2007 USEPA limits) with phase-in period andor ABT over 2008-2012 to provide for early introduction of cleaner product

4 Walk-behind 2 stroke mowers to be included in US EPA Category 5 (gt50cc) product classifications Implementation timing to be as in Recommendation 3 above

5 All products also to be certified to relevant EPA durability categories

6 Subject to further review ABT (if included) may be phased out after 2012

34

7 The Way Forward

The optimum approach for garden equipment out engine emissions of options needs to be sustainable and cost effective This will need to be determined through a costs and benefits analysis (CBA) CBA assigns monetary values and typically assesses the impacts on the consumer on human health on the environment on industry and on government A detailed costs and benefits analysis is beyond the scope of this report however the following sections draws on available information to provide some indication of the possible costs and benefits that are associated with emissions from garden equipment engines

Air Quality Benefits

Environment Canada estimated the introduction of the regulations would result in a 44 percent reduction in combined HC+NOx emissions from small engines used in garden equipment and reduction in individual air pollutants over a 25 year period as shown in Table 15 The Canadian estimates incorporate the benefits that would accrue from the MOU signed with the industry in 2000 plus the benefits from the regulations introduced in 2003 In 2000 Canada imported around 13 million small spark-ignition engines and machines (ie a similar number to Australia) with 80 supplied by the USA

Table 15 Canadian Small Spark-Ignition Engine Emissions in Year 2025

Substance Base Case Emissions in 2025

Emissions in 2025 with Regulations

Percentage Reduction in 2025 (Regulations vs Base Case)

Criteria Air Contaminants (kilotonnes)

HC 772 410 469

NOx a 84 67 201

CO 1413 1403 07

Greenhouse Gas (kilotonnes)

CO2 2903 2645 89 Base case year 2000 (accommodating voluntary agreement) Source Canada Gazette Part II Vol 137 No 24 2003-11-19

Other Environmental Costs and Benefits

In addition to the human health benefits associated with reduced exposure to ozone there is a range of other public benefits including reduced damage to vegetation and therefore higher crop yields less damage to materials and structures particularly

35

some rubber products and improved visibility due to a reduction in smog haze Plus there are benefits associated with lower emissions of other air pollutants

To date there appears to have been little work undertaken in assigning a monetary value to these benefits as it is considered that they are likely to be small compared to human health impacts

Health Costs and Benefits

The Final Impact Assessment for the Ambient Air Quality National Environment Protection Measure (NEPC 1998) estimated that the health damage costs from exposure to ozone nationally to be in the range of $90 ndash $270 million (in 1998 dollars) This figure did not include mortality costs because of difficulty in assigning a figure to human life nor did it include costs associated with minor symptoms such as sore throat cough headache chest discomfort and eye irritation that can result from ozone exposure On the cost of ozone exposure the Impact Assessment states that lsquothe social well-being associated with potentially 6 and 20 million fewer irritating symptoms annually cannot be reliably quantified but at $1 a symptom it adds up to an appreciable amountrsquo

Since the Air NEPM Impact Assessment ozone levels in Australian urban areas have not fallen significantly but the population and medical costs have increased since then However using the above figures to make a rough estimate the contribution made by engines used in lawnmowers (ie not including other garden equipment) to the health damages cost from ozone exposure would be at a minimum $36 - $108 million not including the cost of mortality or minor symptoms As any action on these engines is likely to only remove high emission engines over a decade or more a CBA would be required to include an assessment of the proportional health benefits that would accrue from only removing the high emitters over time

Costs and Benefits to the Consumer

In 1995 the USEPA estimated that on average the cost to the engine manufacturer to install the necessary emission control technology to meet Phase 1 standards (which didnrsquot have ABT) would be approximately $US2 per engine used in nonhandheld equipment and $US350 per engine used in handheld equipment It also estimated that this would translate to sales-weighted average price increases of about $US7

The introduction of phase 2 regulations USEPA estimated would result in price increases of between $US20 and $US64 for handheld equipment depending on the equipment class (USEPA 2000) where handheld engines ranges in price from $60 to $1000 (USEPA 1995)

In addition to emission reductions the implementation of exhaust emission limits has the advantage of reducing fuel consumption and lowering operating costs to the consumer For example the USEPA estimated that for Phase 1 limits that applied between 1995 and 2001 on an average sales-weighted engine basis would decrease fuel consumption by 26 percent for non handheld equipment and a 13 percent decrease in fuel consumption for handheld equipment (USEPA 1995) Phase 2

36

(current limits) would result in a further decrease in fuel consumption of approximately 30 percent for handheld engines

When the USEPA considered the fuel savings offset and the retail price increase it estimated that the average sales-weighted lifetime increase in cost would be about $US650 per handheld engine while nonhandheld engines will realize a lifetime savings of about $US250 per engine This does not include the lifetime savings in maintenance costs which should further benefit the consumer (USEPA 1995)

Euromot (The European Association of Internal Combustion Manufacturers) claims that compliance with European minimum performance standards that do not have ABT provisions adds around 30 to the cost of some products that have had to be brought into compliance4 compared to products sold under the ABT system in the US

Costs and Benefits to Industry and Government

As there is only one local manufacturer among the 43 distributors of powered outdoor garden equipment sold in Australia and all others are importers the main costs to reduce the emissions contribution made by these engines will be associated with program administration and compliance particularly if regulations are introduced

The Productivity Commission an independent agency which is the Australian Governmentrsquos principal review and advisory body on microeconomic policy and regulation recently examined the cost effectiveness of measures to improve the energy efficiency in household appliances As part of its review lsquoThe Private Cost Effectiveness of Improving Energy Efficiencyrsquo it examined labelling programs (ie regulated tiered benchmarks) and minimum mandatory energy efficiency requirements (ie a regulated simple benchmark) While the household appliance market is considerably larger than the garden equipment market the Commissionrsquos final report contains some information that is useful for determining the approach that could be used to establish an emissions reduction scheme for garden equipment A summary of relevant sections of this report is provided in Appendix 3

The Commission identified both administration and compliance costs associated with labelling programs and minimum mandatory energy efficiency requirements as well the impacts these had on product suppliers

The Department of the Environment and Water Resources provided details to the Commission on the costs involved in administering both the labelling scheme and the minimum performance standards for energy programs The information provided showed that

bull the administration costs of the simple benchmark approach were substantially lower (less than one tenth) than for labelling and 84 per cent of administration costs were passed on to appliance purchasers with the remainder borne by governments

4 Presentation by Dr Holger Lochmann Rob Baker Axel Rauch Stihl 19 April 2006

37

bull the compliance costs for labelling are higher

bull minimum mandatory energy efficiency requirements can have a greater cost for suppliers than labelling since suppliers must adjust their model ranges to meet the MEPS levels by the given date These compliance costs are however influenced by the lsquolead inrsquo time between introduction and the implementation of the regulations

bull The increased cost to appliance purchasers of labelled appliances was about two and half times higher compared to appliances purchased under minimum mandatory energy efficiency requirements this being due to consumers voluntarily purchasing more efficient appliances

Overall the Commission considered that labels should be more actively considered as an alternative to minimum performance standards The Commissionrsquos support was based on the ability of labels to amongst other things

bull directly address ldquoa source of market failure mdash the asymmetry of information between buyers and sellers of energy-using productsrdquo

bull provide information to the consumer that is readily-accessible and easily-understood so they can help the consumer make better-informed choices

bull Have net social benefits and possibly have net benefits for consumers

bull provide a greater incentive for suppliers to sell environmentally better products

bull warn consumers through a disendorsement label that an appliance is very inefficient This approach can discourage but not prevent consumers from buying the poor performing product

71 Options to Reduce Emissions from Garden Equipment Engines

There is a range of options that could be considered for reducing emissions from engines used in outdoor garden equipment in Australia These include

1 Do nothing

2 Partnership Programs

3 Quasi regulation

4 Co-regulation

5 Regulations

In the following discussion about these options many Australian examples are mentioned Further details about these programs plus an overview are provided in Appendix 2

38

72 Option 1 ndash Do Nothing

Based on data supplied by OPEA the sales of high emitting two stroke carburettor engines as a percentage of engines used in outdoor equipment increased during the period 2002 to 2005-6 (see Table 12) from 463 to 593 and overall sales number increased by 38 during that period There is no indication that in the short to medium term that sales of equipment with two stroke carburetor engines will decrease in overall sales numbers or as a percentage of sales Therefore under the lsquodo nothingrsquo option emissions from outdoor garden equipment will continue at the same rate or perhaps based on sales figures of two stroke carburetor powered equipment at an even higher rate in the future

73 Option 2 ndash Industry - Government Partnership

In the discussion papers prepared for the NSW small engine project (2004) some examples of successful voluntary Government-Industry Partnership programs were provided The examples included were

bull the National Industry Reduction Agreement where the major newspaper and magazine publishers in Australia agreed to promote recovery and recycling of old newspapers and magazines

bull the NSW EPA-Oil Industry MOU on Summer Fuel the National Packaging Covenant (which has legislative backup) and

bull the EPA Victoriarsquos agreement with the Altona Chemical Complex

From the Australian programs reviewed it appears that the best indicators for successful partnership programs are

bull a relatively small number of firms within the industry

bull a commitment and involvement by all of the industry

bull clear program aims and objectives plus program targets and

bull a willingness by the industry to enter into a cooperative partnership with government

There are 43 identified distributors selling 97 brands of outdoor powered equipment in Australia Many of the major distributors are members of OPEA but there are many distributors who are not members It is therefore unlikely that the even the majority let alone all of the Australian distributors would commit to a industry-government partnership to reduce emissions

74 Option 3 - Quasi Regulation

Quasi regulations can take a range of forms the most usual being the establishment of a code of practice that industry endorses and implements A fundamental part of the code of practice would be emissions standards There are few examples of the use of codes of practice to limit emissions

39

Governmentrsquos role under this scenario is likely to be in assisting in the development of standards

The likelihood of this option being successful for similar reasons to the industry government partnership option is low

75 Option 4 -Co Regulation

Co-regulation is an agreement by industry and government to certain undertakings that support the uptake of cleaner products with a regulatory base It allows industry program flexibility to achieve certain negotiated targets Australian examples of coshyregulation include

bull The Green Vehicle Guide which operates through an industry government agreement where industry report test results to government in an agreed format within a certain timeframe Government manages the data and promotes the program This program is underpinned by Australian Design Rules for motor vehicles

bull The electrical appliance stand-by power program where there are agreed targets established that industry is required lsquovoluntarilyrsquo to meet failure to achieve the targets will result in regulation

bull The Packaging Covenant which is a program that allows industry the flexibility to design it own programs to reduce packaging waste and achieve certain target The Covenant is complemented by the NEPM on used packaging which specifies certain government responsibilities to support the program plus measures that will be introduced if targets are not met

Given the large number of distributors on the Australia market co-regulation for engines used in garden equipment using a similar form to the standndashby power program or the packaging program - an agreement by industry and government on a percentage reduction target for the sale of high emitting engines within a specified timeframe together with an agreement that regulation will be adopted if the target is not met ndash is also unlikely to be successful

76 Option 5 - Regulation

Regulation which requires a clear acknowledgement of a sufficient problem by Government places uniform mandatory compliance obligations on industry The costs associated with regulations are usually shared between government and industry with the development of regulations and program administration costs being borne by government with industry meeting compliance costs including emissions testing and if applicable labelling costs

It could argued that regulation should be introduced in the States or Territories where there are exceedances of the Air NEPM ozone standards However development of state based regulations for garden equipment engines emissions is unlikely as they would be incompatible with the 1992 Intergovernmental Agreement on the

40

Environment signed by the Commonwealth States and Territories and existing Commonwealth and State Government mutual recognition legislation The Intergovernmental Agreement on the Environment which underpins the development of National Environment Protection Measures obligates all jurisdictions to ensure equivalent protection from air pollution to all Australians

In addition enforcement of any state based legislation would be a key problem Under the Commonwealth Mutual Recognition Act 1992 and the Trans-Tasman Mutual Recognition Act 1997 goods that are imported into or produced in an Australian State or Territory or New Zealand that can be sold lawfully in that jurisdiction can be sold freely in a second jurisdiction even if the goods do not comply with the regulatory standards of the second jurisdiction This means non-regulated small engine products legally sold in one State could be legally sold in any other state regardless of whether emissions limits on small engines applied in that State

National regulation on the other hand would provide national consistency It would also provide the opportunity to adopt worldrsquos best practice standards and incorporate penalties for non-complying parties

Under the Australian Constitution the Commonwealth does not possess specific legislative powers in relation to the environment and heritage There are however a number of legislative powers that can support environment and heritage legislation Furthermore Commonwealth legislative powers can be used cumulatively For example the Commonwealth Parliament can make laws under section 51(20) of the Constitution with respect to ldquoforeign corporations and trading or financial corporations formed within the limits of the Commonwealthrdquo

Legislative mechanisms may also be created through the development of a National Environment Protection Measure (NEPM) that then becomes law within each jurisdiction A NEPM can accommodate flexibility of implementation where jurisdictions that have elevated ozone levels can tailor their NEPM program to their specific air quality needs An example of this flexible approach is the Diesel NEPM which has a suite of programs which can be implemented by jurisdictions

From the review of Australian regulations to reduce the environmental impacts of products and the overseas approaches to control emissions from small engines two regulatory approaches become apparent a simple benchmark or tiered benchmarks These are outlined below

Regulatory Option1 - A Simple Benchmark Approach

The most basic regulatory approach that could be taken would be to have a single emission standard (or as per the USA Europe and California a number of emission standards based on power and application) for combined HC + NOx emissions All equipment with new engines sold in Australia from the date the regulations are introduced This approach would

bull remove the all high emission engines from sale

41

bull be supported by an Australian Standard and

bull provide consumers with confidence that all products meet certain emissions standard

Regulatory Option 2 -Tiered Benchmarks

Current Australian directions to reduce the environmental impact of consumer products favour tiered benchmarks using a lsquostarrsquo rating system (see Appendix 2 for examples)

For engines used in garden equipment a tiered emissions labelling system could be based on the USEPA Phase 1 and Phase 2 standards use a system of lsquostarsrsquo to provide information to consumers about environmental performance but not limit consumer choice A tiered lsquostarrsquo system approach would

bull reward those products with more stars that meet the more stringent overseas standards

bull either operate with minimum emissions performance standards or disendorsement labels

bull be supported by a product label and possibly a web database

bull provide consumers emissions information and the option to purchase a lower emission engine

bull be supported by an Australian Standard and

bull be devised to meet worldrsquos best practice which is an overarching approach supported by Government

Table 16 summarises the main strengths and weaknesses of the above options

42

Table 16 Main Strengths and Weaknesses of Each Option

Strengths Weaknesses

Do Nothing Does not limit consumer choice Emissions contribution likely to grow No cost to government No barrier to new market entrants selling

high emitters Consumers have a wide choice of products Industry unchecked amp product dumping

likely No enforcement recourse on environmental grounds available

Partnerships Some sharing of responsibility government Slow if any reduction in high emitters

ndash industry

Potential for Government assist in Few if any companies likely to join and no advancing reductions in high emitters restrictions on non signatories Reduction targets set Below worldrsquos best practice

Quasi Regulation Similar strengths to partnership option Similar weaknesses to partnership option as

few if any companies likely to adopt code of practice

Co-Regulation Ongoing consultation between industry and Due to industry diversity targets unlikely to government recourse to regulation be met Targets set and can require new market Slow reduction in emissions entrants to achieve targets Can have implementation flexibility Emissions test standard adopted

Regulation Option 1- Simple Benchmark Worldrsquos best practice standards can be ovide incentives to manufacturers to promote low adapted and is mandatory emitters

Recourse to legal action available for non Does not provide consumers with emissions compliance information Significant quantifiable health benefits Cost of enforcement borne by taxpayers Requires compliance by all industry and High cost to government bans high emitters

Regulation Option 2 ndash Tiered Benchmarks Provides consumers with emissions information but does not limit choice Incentives for manufacturers to sell low emitters Potentially significant quantifiable health benefits Can be designed to overcome ABT issue

Significant administration and compliance costs to Government High cost to government and industry and will increase retail price of engines Does not ban high emitters

43

77 Preferred Approach

From the above discussion and from the review of garden equipment on available to the Australian consumer there are many companies selling powered garden equipment on the Australian market and the market is very competitive Furthermore from the Expert Panel discussions and stakeholder consultation it is apparent that it is highly unlikely that all the companies in the garden equipment industry would engage in or commit to a voluntary program to reduce their productsrsquo exhaust emissions It is therefore clear that the only feasible path to reduce emissions from these small engines is through regulation

While regulations of emissions from small engines used in garden equipment in Australia are likely to be based on overseas regulations they need to strike a balance between improved environmental outcome harmonisation with international standards and the characteristics of the local industry With regulation optimum emissions reductions are achievable especially by combining minimum emissions standards with tiered product labelling Whether this approach is justifiable on economic grounds that is the benefits outweigh the costs can only be determined through a detailed impact assessment Based on these findings it is recommended that a formal assessment of the costs and benefits of nationally regulating 2 and 4 stroke lawn mowers and handheld power equipment should now be commenced

44

References Air Resources Board California Environmental Protection Agency Californian Exhaust Emission Standards and Test Procedures for 2005 and Later Small Off-road Engines July 26 2004

Artcraft 2003 A Major Research-Based Review and Scoping of Future Directions for Appliance Efficiency Labels in Australia and NZ prepared for the Australian Greenhouse Office viewed at wwwenergyratinggovaulibraryindexhtml

Australian Bureau of Statistics 1999 Older People Australia A Social Report Report Number 41090 December 1999

Australian Greenhouse Office 2002 Achievements 2002 National Appliance equipment energy efficiency program Commonwealth of Australia

Australian Greenhouse Office 2002 Achievements 2002 National Appliance equipment energy efficiency program Commonwealth of Australia

AustralianNew Zealand StandardtradeASNZS 64002005 Water efficient productsmdashRating and labeling Federal Register of Legislative Instruments F2005L01571

Bei L T and Widdows R1999 Product knowledge and product involvement as moderators of the effects of information on purchase decisions a case study using the perfect information frontier approach Journal of Consumer Affairs 33(1) 165-186

Buy Recycled Busines Alliance Briefing Paper Environmental Claims And Labelling Abstract lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10-2003

California Code of Regulations 1998 Final Regulation Order Article 1 and Article 3 Chapter 9 Division 3 Title 13 Attachment 1 26 March 1998 wwwarbcagovregactsoreregs_finpdf

Canada Gazette Part II Vol 137 No 24 2003-11-19

Canadian Gazette 29 March 2003 Vol 137 No 13 Part 1 pp 935- 955

Cap Gemini Ernst amp Young (2001) Cars Online 2001 Global consumer survey httpa593gakamainet75931951a8b278a28319eawwwcgeycomhightechautomediaC ars_online2pdf

Clothes Washers Australiarsquos Standby Power Strategy 2002 ndash 2012 Standby Product Profile 200308 October 2003 wwwenergyratinggovau

Craig ndash Lees M Joy Sally Browne B 1995 Consumer Behaviour John Wiley amp Sons Queensland 1995

Department of Environment and Conservation NSW 2004 Measures to Encourage the Supply and Uptake of Cleaner Lawnmowers and Outdoor Handheld Equipment

45

Department of Environment and Conservation 2003 Who cares about the environment in 2003 A survey of NSW peoplersquos environmental knowledge attitudes and behaviours DEC Social Research Series

Department of Environment and Conservation Action for Air update 2006

Department of Environment and Conservation The Buy Recycled Guide Online Directory viewed at wwwresourcenswgovauindex-RNSWhtm

EcoRecycle 2004 Paint Take-Back Takes Off in Bayswater Media release 24 March 2004 viewed at wwwecorecyclevicgovau May 2004

Enviromower viewed at wwwenviromowercomau June 2004

Environment Canada 2000 Future Canadian Emission Standards for Vehicles and Engines and Standards for Reformulation of Petroleum Based Fuels Discussion Paper in Advance Notice of Intent by the Federal Minister of the Environment April 2000 wwwecgccaenergfuelsreportsfuture_fuelsfuture_fuels1_ehtm

Environment Canada 2004 Environment Minister Urges Canadians to Reduce Greenhouse Gas Emissions and Mow Down Pollution With Unique Incentive Program Media Release April 23 2004 viewed at wwwecgccamediaroomnewsrelease May 2004

Environment Protection and Heritage Council National Environment Protection (Ambient Air Quality) Measure Report on the Preliminary Work for the Review of the Ozone Standard October 2005

Environment Protection Authority 2006 Victoriarsquos Air Quality ndash 2005 Publication 1044 June 2006 wwwepavicgovau

Environmental Choice NZ 2001 Public Good and Environmental Labelling An Internal Background Paper

European Commission Directive 200344EC amending the recreational craft directive and comments to the directive combined 211005

George Wilkenfeld and Associates Pty Ltd with Artcraft Research and Energy Efficient Strategies Tomorrow Today 2003 Final Report A Mandatory Water Efficiency Labelling Scheme for Australia Prepared for Environment Australia June 2003

George Wilkenfeld and Associates 2003 A National Strategy for Consumer Product Resource Labelling in Australia prepared for the Australian Greenhouse Office December 2003 viewed at wwwenergyratinggovaulibraryindexhtml

Green Vehicle Guide wwwgreenvehicleguidegovau

Harrington L and Holt S 2002 Matching Worldrsquos Best Regulated Efficiency Standards ndash Australiarsquos success in adopting new refrigerator MEPS wwwenergyratinggovaulibrarypubsaceee-2002apdf

46

Harris J and Cole A 2003 The role for government in ecolabelling ndash on the scenes or behind the scenes lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10-2003

Holt S and Harrington L2003 Lessons learnt from Australiarsquos standards and labeling program Paper presented at ECEEE Summer Study - 2-6 June 2003 wwwenergyratinggovaulibraryindexhtml

IBIS 2006a Domestic Hardware Retailing 09-Jun-2006 Industry Code G523b

IBIS 2006b Gardening Services 18-Jan-2006 Industry Code Q9525

IBIS 2003 Gardening Services in Australia 23 December 2003 Industry Code Q9525

Lawrence K Zeise K amp Morgan P 2005 Management Options for Non-Road Engine Emissions in Urban Areas Consultancy report for Department for Environment amp Heritage Canberra

Motor Vehicle Environment Committee (MVEC) in consultation with the Department of Transport and Regional Services 2002 Proposal for an Australian ldquoGreen Vehiclesrdquo Guide viewed at httpwwwdotarsgovaumvegreen_vehicles_guidedoc May 2004

National Appliance and Equipment Energy Efficiency Committee The Energy Label at wwwenergyratinggovau (3504)

National Environment Protection Council 2005 National Environment Protection (Ambient Air Quality) Measure Report on the Preliminary Work for the Review of the Ozone Standard October 2005

National Environment Protection Council 1998 Final Impact Assessment for Ambient Air Quality National Environment Protection Measure June 1998

National Environment Protection Council 1999 Used Packaging Materials Impact Statement for the Draft NEPM Used Packaging Material January 1999 viewed at wwwephcgovau

National Environment Protection Council 2004 National Environment Protection (Air Toxics) Measure April 2004 viewed at wwwephcgovau

New South Wales Government 2002 Protection of the Environment Operations (Clean Air) Regulation 2002

New South Wales Government 1999 NSW Government Procurement Policy Statement White Paper 1999

Nordic Council 2002 Ecolabelling of marine Engines Criteria Document 8 December 1995 ndash 6 December 2005 version 35 December 2002

47

Office of Public Sector Information Statutory Instrument 2004 No 2034 The Non-Road Mobile Machinery (Emission of Gaseous and Particulate Pollutants) (Amendment) Regulations 2004 wwwopsigovuksisi200420042034htm

Outdoor Power Equipment Institute 2001 Profile of the Outdoor Power Equipment Industry wwwopeiorg

Productivity Commission 2004 The Private Cost Effectiveness of Improving Energy Efficiency Final report October 2005 wwwpcgovauinquiryenergy

Publishers National Environment Bureau Media Release lsquoAustralia leads the world in newspaper recyclingrsquo 6 June 2006 wwwpnebcomau

Real J Jones A 2005 The Green Vehicle Guide Clean Air Soceity of Australia and New Zealand Conference 2005 Hobart

Salmon G Voluntary Sustainability Standards and Labels (VSSLs) The Case for Fostering Them OECD Round Table On Sustainable Development

Schkade D A and Kelinmutz D N 1994 Information displays and choice processes differential effects of organization form and sequence Organizational Behavior and Human Decision Processes 57(3) 319-337

Stephens A 2003 Eco Buy (Local Government Buy Recycled Alliance Victoria) Abstract lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10shy2003

Teisl M F Roe B and Hicks RL 2002 Can eco-labels fine tune a market Evidence from dolphin-safe labeling Journal of Environmental Economics and Management 43339-359

Teisl M F Roe B and Levy A S Ecolabelling What does consumer science tell us about which strategies work pp141-150

The ISO 14000 family of standards guides and technical reports

The Parliament of the Commonwealth of Australia 2004 House of Representatives Water Efficiency Labelling and Standards Bill 2004 Explanatory Memorandum wwwcomlawgovauComLawLegislationBills1nsf viewed February 2006

Thogerson J 2000 Promoting green consumer behaviour with eco-labels Workshop on Education Information and Voluntary Measures in Environmental Protection National Academy of Sciences ndashNational Research Council Washington DC November 29-30

United States Environmental Protection Agency Federal Register Vol 60 No 127 3 July 1995 Control of Air Pollution Emission Standards for New Nonroad Spark-ignition Engines At or Below 19 Kilowatts wwwepagovEPA-AIR1995JulyDay-03prshy805txthtml

48

United States Environmental Protection Agency Federal Register Vol 69 No 7 12 January 2004 Rules and Regulations 40 CFR Part 90 Amendments to the Phase 2 Requirements for Spark-Ignition Nonroad Engines at or Below 19 Kilowatts Direct Final Rule and Proposed Rule wwwepagovfedrgstrEPA-AIR2004JanuaryDay-12a458pdf

United States Environmental Protection Agency Office of Pollution Prevention and Toxics Pollution Prevention Division 1998 Ecolabelling Environmental Labelling - A Comprehensive Review of Issues Policies and Practices Worldwide

United States Environmental Protection Agency Office of Transportation and Air Quality March 2000 Regulatory Announcement Final Phase 2 Standards for Spark-Ignition Handheld Engines

United States Environmental Protection Agency 1998 Proposed Phase 2 Emission Standards for Small SI Engines 27 January 1998

United States Environmental Protection Agency 2000 Regulatory announcement Final Phase 2 Standards for Small Spark-Ignition Handheld Engines March 2000 EPA420-F-00shy007

United States Federal Register Vol 69 No 7 Monday January 12 2004 Rules and Regulations Environmental Protection Agency 40 CFR Part 90 Amendments to the Phase 2 Requirements for Spark-Ignition Nonroad Engines at or Below 19 Kilowatts Direct Final Rule and Proposed Rule United States Federal Register Vol 64 No 60 30 March 1999 40 CFR Part 90 Phase 2 Emission Standards for New Nonroad Spark-Ignition Nonhandheld Engines At or Below 19 Kilowatts Final Rule pp15214-15216

United States Federal Register Vol 65 No 80 25 April 2000 40 CFR Parts 90 and 91 Phase 2 Emission Standards for New Nonroad Spark-Ignition Handheld Engines at or Below 19 Kilowatts and Minor Amendments to Emission Requirements Applicable to Small Spark-Ignition Engines and Marine Spark-Ignition Engines Final Rule pp24282-24284

United States Environmental Protection Agency Control of Air Pollution Emission for New Nonroad Spark-ignition Engines At or Below 19 Kilowatts Final Rule 40 CFR Parts 9 and 90 1995 wwwepagovEPA-AIR1995JulyDay-03pr-805txthtml

United States Environmental Protection Agency Office of Pollution Prevention and Toxics Pollution Prevention Division 1998 Ecolabelling Environmental Labeling- A Comprehensive Review of Issues Policies and Practices Worldwide

Victorian Government Greenhouse Strategy Community Action Fund - Mow Down Lawn Mower Rebate Exchange Program wwwgreenhousevicgovaucommunitygrantscafsuccessfulprojectshtm

Water Efficiency Labelling and Standards Act 2005 No 4 wwwcomlawgovauComLawLegislation

49

Water Efficiency Labelling and Standards Determination 2005 wwwcomlawgovauComLawLegislationLegislativeInstrument1nsf

Water Efficiency Labelling and Standards Regulations 2005 wwwcomlawgovauComLawLegislationLegislativeInstrument1nsf

Wilkie W 1994 Consumer Behaviour John Wiley and Sons NY as cited in Craig ndash Lees M Joy Sally Browne B 1995 Consumer Behaviour John Wiley amp Sons Queensland 1995

wwwenergyratinggovau

wwwgreenvehicleguidegovau

wwwwaterratinggovau

50

Appendix 1 Detailed Breakdown of Powered Garden Equipment on the Australian Market

The following table gives a profile of the current equipment on the Australian market It is based mostly on distributor responses to a survey and might not be representative of the total market

Low sales indicates that no sales data was available but volumes are likely to be small compared with popular equipment Phase 1 is US EPA Phase 1 or EU Directive 200288EU Phase 2 is US EPA Phase 2 or Euro standards

Type Ranges Stroke Aerator 5 makes 6 models Sales Low

Engine power 26 to 172kW Engine displ 143-674 ml

2c -4c 5 Unspecified 1 Phase 1 - Phase 2 4

Auger 3 makes 5 models Sales Low

Engine power 12 to 16kW Engine displ 31-ml

2c 5 4c -Unspecified -Phase 1 1 Phase 2 1

Backhoe 0 makes 0 model Sales Low

(2 models in 2003) -

Blower 13 makes 49 models Sales 109K

Engine power 07 to 31kW Engine displ 24-80ml

2c 34 4c 2 Unspecified 13 Phase 1 10 Phase 2 17

Blower-wheeler 3 makes 6 models

Engine power 07 to97kW Engine displ 24-305ml

2c 1 4c 4 Unspecified 1 Phase 1 3 Phase 2 -

Blowervac 6 makes 9 models Sales

Engine power 07 to 11kW Engine displ 24-34ml

2c 6 4c -Unspecified 3 Phase 1- Phase 2 3

Brush cutter 12 makes 95 models Sales 339K

Engine power 06 to 23kW Engine displ 21-54ml

2c 66 4c 5 Unspecified 24 Phase 1 15 Phase 2 34

Chainsaw 9 makes 106 models Sales 152K

Engine power 1 to 58kW Engine displ 26-122ml

2c 74 4c -Unspecified 32 Phase 1 18 Phase 2 27

Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

51

Type Ranges Stroke Clearing saw Engine power 14 to 27kW 2c 6 3 makes Engine displ 36-57ml 4c 0 9 models Unspecified 3 Sales low Phase 1 4 Phase 2 -Cultivator Engine power 07 to 52kW 2c 2 4 makes Engine displ 25-190ml 4c 5 7 models Unspecified -Sales low Phase 1 - Phase 2 5 De-thatcher Engine power 1kW 2c 1 1 makes Engine displ 27ml 4c -1 models Unspecified -Sales low Phase 1 - Phase 2 1 Drill Engine power 1kW 2c 3 3 makes Engine displ 27ml 4c -4 models Unspecified 1 Sales low Phase 1 - Phase 2 1 Edger Engine power 1 to 4kW 2c 12 10 makes Engine displ 24-190ml 4c 11 36 models Unspecified 1 Sales Phase 1 3 Phase 2 22 Garden tractor Engine power 12 to 157kW 2c -2 makes Engine displ 465 to 675ml 4c 5 12 models Unspecified 9 Sales low Phase 1 - Phase 2 3 Grass trimmer Engine power- 2c 3 1 make Engine displ 31ml 4c -3 model Unspecified -Sales Phase 1 - Phase 2 3 Hedge trimmer Engine power 06 to 1kW 2c 28 10 makes Engine displ 21-31ml 4c 1 42 models Unspecified 13 Sales 40K Phase 1 4 Phase 2 35 Lawnmower Engine power 26 to 66kW 2c 22 19 makes Engine displ 100-270ml 4c 151 183 models Price $449-$3609 Unspecified 10 Sales 424K Phase 1 95 Phase 2 48 Line trimmer Engine power 07 to 45kW 2c 25 8 makes Engine displ 24-195ml 4c 2 29 models Price $136-$299 Unspecified 2 Sales Phase 1 2 Phase 2 6 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

52

Type Ranges Stroke Log splitter Engine power 26 to 45kW 2c -1 makes Engine displ 100-195ml 4c 2 2 models Unspecified -Sales low Phase 1 - Phase 2 1 Multicutter Engine power 08 to 14kW 2c 17 5 makes Engine displ 23-36ml 4c 1 19 model Unspecified 1 Sales Phase 1 2 Phase 2 13 Olive nut shaker Engine power - 2c -1 make Engine displ - 4c -1 model Unspecified 1

Phase 1 - Phase 2 -Pole saw Engine power 08 to 14kW 2c 6 4 makes Engine displ 23-36ml 4c -10 models Unspecified 4 Sales low Phase 1 1 Phase 2 3 Power carrier Engine power 37 to 231kW 2c -2 makes Engine displ 160 to 953ml 4c 11 11 models Unspecified -Sales low Phase 1 - Phase 2 10 Power cutter Engine power 32 to 45kW 2c 5 2 makes Engine displ 64-99ml 4c -8 models Unspecified 3 Sales low Phase 1 1 Phase 2 3 Pruner (3 models in 2003) 2c -0 make 4c -0 models Unspecified -Sales low Ride-on-mower Engine power 26 to 231kW 2c -12 makes Engine displ 100 to 725ml 4c 93 124 models Unspecified81 Sales 51K Ph1 1 Ph2106 Rotary hoe (4 models in 2003) 2c -0 makes 4c -0 models Unspecified -Sales low Shredder Engine power 3 to 96kW 2c 1 6 makes Engine displ 126-389ml 4c 16 20 models Unspecified 3 Sales 46K Phase 1 - Phase 2 4 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

53

Type Ranges Stroke Stump grinder Engine power 96kW 2c -1 make Engine displ 389ml 4c 1 1 model Unspecified -Sales low Phase 1 - Phase 2 1 Tiller Engine power 08 to 59kW 2c -3 makes Engine displ 25-243ml 4c 8 9 models Unspecified 1 Sales low Phase 1 - Phase 2 7 Trencher Engine power37kW 2c -1 makes Engine displ 183ml 4c -1 models Unspecified 1 Sales low Phase 1 - Phase 2 1 Trimmer Engine power - 2c 10 2 makes Engine displ - 4c -21 models Price - Unspecified 11 Sales Phase 1 4 Phase 2 -Turfcutter Engine power 37kW 2c -1 makes Engine displ - 4c 1 1 models Unspecified -Sales low Phase 1 - Phase 2 -Vac Engine power 22 to 172kW 2c 1 5 makes Engine displ 158 to 674ml 4c 13 15 models Unspecified 1 Sales Ph11 Ph24 Vac chipper Engine power 34 to 45kW 2c -2 makes Engine displ 158-195ml 4c 3 3 models Unspecified -Sales low Phase 1 - Phase 2 1 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

54

Appendix 2 Examples of Current Australian Benchmarking Programs

The following describes in varying degrees of detail a number of current Australian benchmarking schemes classified by program type simple bench mark approaches tiered benchmarks and government industry partnerships This appendix concludes with a summary table of these programs with an assessment of their effectiveness

1 Introduction

Simple benchmark schemes (described below) such as the woodheater standards set a single point hurdle rate whereas the green vehicle guide use tiered benchmarks The new water efficiency labelling scheme and minimum energy efficiency performance standards uses both a simple benchmark through minimum performance requirement plus tiered benchmarks incorporated into labels as lsquostarsrsquo Other approaches such as the stand-by power program and the Victorian Altona Complex VOC reduction target set goals for achievement within a specified time period Other approaches taken to reduce environmental impacts include the National Packaging Covenant which uses a program based on individual companies developing tailored approaches to suit their circumstances and is supported by enforcement capability through the National Environment Protection (Used Packaging Materials) Measure (the NEPM)

2 Simple Benchmarks

21 Minimum Energy Performance Standards (MEPS)

Purpose

MEPS prescribe a minimum allowed energy performance for specific appliances Appliances that are less efficient than the relevant standard are excluded from the market

Background and Strategy

In October 1999 as part of the National Greenhouse Strategy (1998) nationally consistent MEPS and labelling schemes were adopted across Australia

Independent NATA accredited laboratories undertake product compliance checks to see whether products perform in compliance with MEPS requirements For example

bull In 2003 the government conducted check tests on eight appliance models all of which were found not to meet the claims made on the energy performance labels Two products were deregistered one was found to have not been registered and action was pending on the remaining five products (AGO 2003b)

55

bull Other regulatory actions undertaken in 2003 included fines of $3000 and $8000 against two Western Australian retailers who were found to have sold appliances without energy performance labels Queensland and Victorian retailers received infringement notices and fines totalling $10 000 (AGO 2003b)

Summary RegulNated minimum performance standards based on an Australian Standard

22 Energy Star

Purpose

An endorsement label that indicates an electronic product has achieved a specified standard when it is not performing its core function (ie on stand by)

Background and Strategy

Energy Star is a voluntary endorsement labelling program developed by the US Environmental Protection Agency (US EPA) It has been operating in the USA since 1992 and has been adopted by a number of countries including Australia Energy Star sets voluntary standards for reducing the electricity consumption of electronic equipment when it is not performing its core function

The Government stand ndash by program which is outlined below complements the energy star labelling program

Summary Voluntary endorsement label

23 Woodheater Standards

Purpose

To reduce particle emissions through Australian Standard compliant woodheaters

Background and Strategy

Since 1992 Australian StandardNew Zealand Standards have been introduced to improve the performance of wood heaters

The first standard for wood heater emissions AS4013 (1992) was published in 1992 and was revised and published as a joint AustralianNew Zealand Standard in 1999 ASNZS4013 (1999) Domestic solid fuel burning appliances - Method for determination of flue gas emission This Standard provides a test method to measure particles emitted by residential solid-fuel burning heating appliances

56

The 1992 Standard included an upper limit for acceptable particle emissions of 55 grams of particles per kilogram (oven-dry weight) of fuel burnt This emission factor was reduced to 4 gkg in the 1999 revision of the Standard The Standard applies to solid-fuel burning space-heating appliances (including those fitted with water heating devices) with a heat output of 25KW or less It does not apply to masonry fireplaces cooking stoves central heating appliances or water-heating-only appliances

AS 4013 (1999) is complemented by ASNZS4014 (1999) Domestic solid fuel burning appliances - Test Fuels and ASNZS4012 (1999) Domestic solid fuel burning appliances - Method for determination of power output and efficiency

The woodheater industry was instrumental in initiating the development of standards and it lobbied states and territories to enact legislation to mandating that woodheaters be required to meet the standards As the health affects of particle pollution have become more apparent and as some jurisdictions are having difficulty in meeting national particle standards Government has become more proactive in controlling woodheaters and more supportive of tighter standards

All states and territories with the exception of South Australia have regulations that restrict emissions from new woodheaters although Victoria for example only introduced its regulations in 2004 compared to Tasmania who introduced regulations in 1993 These regulations require that new woodheaters comply with the Australian Standard ASNZS 4013 The State regulations however are not uniform

Many woodheaters that are currently certified for sale do not comply with the revised standard as verified in a National Woodheater Audit Program undertaken in 2004 Seven of the 12 wood heaters tested failed to meet the ASNZS 4013 particle emission limit In addition 55 of heaters were found to have deviations from the original designs and 72 had labelling faults that could adversely affect emissions performance

Testing and certification are administered by the industry association

Summary State and regulations requiring compliance with Australian Standards Certification administered by industry association

24 Standby Power

Purpose

To reduce lsquoexcessiversquo energy consumed in electrical appliance standby mode sold in Australia through in the first instance voluntary targets Appliances covered by the program range from information technology equipment such as PCs and photocopiers entertainment equipment such as TVs DVDs and sound systems major appliances such as water heaters dishwashers and refrigerators and small appliances such as smoke detectors and bread makers

57

Background and Strategy

In 2000 standby power was estimated to constitute 116 per cent of Australiarsquos residential energy use costing households over $500 million and leading to the emission of over 5 million tonnes of carbon dioxide equivalent (AGO 2002c) Holt and Harrington (2004) estimated that standby power consumption in Australia could be reduced by 56 per cent by 2020 (Productivity Commission 2005)

In August 2000 all Australian jurisdictions agreed to pursue efficiencies in standby power consumption of energy-consuming products through support for the International Energy Agencys One -Watt program and endorse its incorporation into theprogram of work

Australia reportedly has taken the lead on implementing the One- Watt program even though many of the products sold in Australia are imported

During 2002 government agencies consulted with stakeholders about ideas to reduce standby The standby strategy which proposed a list of targeted potential product types was presented to the Ministerial Council on Energy

In September 2003 an interim test method for the measurement of standby power ASNZS 62301-2003 (int) based on an internationally recognised standard was published Also during this period work commenced on developing draft product profiles for high priority targeted products

Once product profiles are completed interim voluntary date-specific targets are made The product sales are then monitored to determine progress towards the interim target If it is then determined that inadequate progress is being achieved by a significant number of suppliers then government will regulate

For example the interim 2007 target for clothes washers is as follows

Product Off mode power End of program mode

lt 1W lt 4 W

The National Standby Strategy Target to be achieved by 2012 for clothes washers is as follows

Off mode power End of program mode lt 03 W lt 1 W

In support of the clothes washer program Government will

bull consider creating a Government Purchasing Policy to buy low standby clothes washers where available and fit for purpose

bull collect data on all modes for new clothes washers and analyse trends

bull highlight the range of performances by publishing performance data on clothes washers on a website or by other means

58

bull progressively include standby energy consumption into the Comparative Energy Consumption for labelled products such as clothes washers and clothes dryers

bull work with the Standards Committees to finalise the details of modes and test methods for the relevant standards

bull determine in 2008 if progress is inadequate and if regulation is required

Summary Industry targets possible future regulation

3 Tiered Benchmarks

31 Mandatory Energy Efficiency Label ndash the Energy Star Programs

Purpose

To enable consumers to easily compare the energy performance of electrical appliances used by households and firms through a labelling scheme

Background and Strategy

Several Australian states commenced mandatory energy efficiency labelling for major appliances in the mid-1980s In 1992 it became mandatory across Australia for initially refrigerators and later freezers clothes washers clothes dryers dishwashers and air-conditioners (single phase only) to carry the label when they are offered for sale This labelling program is regarded as one of the most successful in the world (Wilkenfeld and Assoc 2003) It is administered through the Australian Greenhouse Office

The energy rating label for dishwashers

(ldquoa joint government and industry programrdquo) and a website address (wwwenergyratinggovau) and has two main features

bull the star rating which gives a quick comparative assessment of the models energy efficiency and

bull the comparative energy consumption (usually kilowatt hoursyear) which provides an estimate of the annual energy consumption of the appliance based on the tested energy consumption and information about the typical use of the appliance in the home These values are measured under Australian Standards which define test procedures for measuring energy consumption and minimum energy performance criteria Appliances must meet these criteria before they can be granted an Energy Rating Label

The Energy Rating Label includes an endorsement

59

Awards Brand ModelInstallat

ionType

Phase Available

10 Yr Energy

Cost StarRating

Output(kW)

TOSHIBA

Digital Inverter Series Air

Conditioner RAV-SM1102BT-

ERAV-SP1102AT-E (

RAV-SM1102BT-ERAV-

SP1102AT-E)

SingleSplit

SystemDucted

Single $1500 1000

CHUNLAN

KFR-32GWVWa (

NO)

SingleSplit

SystemDucted

Single $645 323

Since its introduction the star rating label seems to have established a high level of recognition with consumers Consumer research (Artcraft 2003) indicates that the different information on the label appeals to different consumer segments interested in purchasing an appliance

When a manufacturer gains approval to use the label they pay for and produce the label in accordance with specifications on size colours fonts layout and design A similar colour scheme and design to the energy consumption label is also used for the compulsory fuel consumption label on new passenger and light commercial vehicles

The labelling scheme is underpinned by regulation whereby regulated Minimum Energy Performance Standards (MEPS) provide the environmental benchmarks that the appliances are required to meet Appliances that do not meet the minimum energy performance standards can be withdrawn from the Australian market

When the energy rating program was reviewed in 2000 technology had advanced to the point where a large percentage of appliances had achieved the maximum number of stars so the rating system was tightened It is estimated that over the 25 year period 1980 to 2005 there will have been an overall reduction in energy consumption of around 70 by the most popular sized refrigerators (with freezers) (Harrington L and Holt S 2002)

In addition to the energy consumption label there is a website (wwwenergyratinggovau) with a comprehensive database of all appliances their star rating and energy consumption In 2002 there were around 220000 hits on the programrsquos various websites and 523000 in 2003 reportedly representing 80000 visits by individual inquirers The website hit rate is estimated to represent almost 10 of consumers who are considering purchasing an appliance (Holt et al 2003)

Cooling

Energy Input (kW)

250

104

Figure B Excerpt from Energy Rating web page for Air Conditioners (cooling cycle only shown)

When the energy rating program was reviewed in 2000 technology had advanced to the point where the Scheme had to be tightened because a large percentage of appliances had achieved the maximum number of stars For example energy use by refrigerators was around 70 compared to that used when the scheme started (Harrington L and Holt S 2002)

60

Regulations

State and Territory legislation refer to the relevant Australian Standards This approach simplifies the State and Territory legislation and makes it relatively straightforward to maintain national consistency of appliance and equipment energy efficiency standards even when standards are continually being revised

The testing procedures and technical requirements for the label and also Minimum Energy Performance Standards (MEPS see below) are incorporated into the applicable Australian Standards Products for sale must be registered with one of the State regulators

Program Administration

The labelling program and MEPS program are administered by the National Appliance and Equipment Energy Efficiency Committee (NAEEEC) which is ultimately directed by the Ministerial Council on Energy

Requirements for Appliance Suppliers

Appliance suppliers are required to

bull Submit applications for product registration and these must include a test report or other data to demonstrate that the appliance meets the relevant Australian Standard

bull While test reports on three separate units are required for most products there is no particular requirement for test laboratories to be accredited or products certified for registration for energy labelling and MEPS in Australia Test reports from the manufacturers laboratory are satisfactory However if there is evidence that results from a particular laboratory are unsatisfactory regulators can mandate test reports from an accredited laboratory

Summary Mandatory labelling scheme backed by regulations and an Australian Standard

32 Water Appliances Water Efficiency Labelling and Standards (WELS) Scheme

Purpose

A labelling scheme backed by legislation to promote domestic water efficient appliances

Background and Strategy

A voluntary water efficiency industry administered labelling scheme has been in existence since 1988 The water efficiency ratings and details on the label design are covered in ASNZS 6400 The main incentive of the voluntary lsquoAAAAArsquo scheme

61

has been the publicity and cash rebates offered by water utilities However the coverage water efficiency performance requirements and impact of this program have been limited

In 2003 the Environment and Heritage Ministers agreed to implement a national Water Efficiency Labelling Scheme (WELS) for products such as shower heads washing machines dishwashers and toilets Consultation with industry and stakeholders was undertaken in 2003 with a strategic study published that identified the products to be included in the new labelling Scheme A Regulation Impact Statement (RIS) which identified the costs and benefits of various options and made various recommendations was published in March 2004 Following public review of the RIS some modifications were made to WELS

The WELS Scheme is backed by the following legislation and standard

Water Efficiency Labelling and Standards Act 2005 which establishes

bull the products subject to the Scheme and the requirements for registration and labelling

bull the standards to apply to WELS products setting requirements for water efficiency performance registration and labelling of these products

bull enforcement provisions including penalties bull the appointment of inspectors to investigate possible contraventions and sets

out their powers and obligations bull review and dispute resolution bull a program Regulator bull the making of regulations bull a requirement for annual reports and for an independent review after five years

Water Efficiency Labelling and Standards Regulations 2005 which

bull prescribes the circumstances in which a person other than the manufacturer of a WELS product may be taken to be the manufacturer of the product (eg an importer)

bull sets out procedures for the issuing and the payment of penalty infringement notices as an alternative to prosecution for offences against the WELS Act

bull specifying the information to be included on an identity card issued to a WELS inspector

Water Efficiency Labelling and Standards Determination 2005 amongst other things determines and establishes product registration fees and calls up the Australian Standard ASNZS6400 2005 Water-efficient products - Rating and labelling which

bull defines the products

bull specifies the assessment procedures (ie identifies test procedures in other Australian Standards)

bull provides the formulas to give products their star rating

bull specifies the labels and their application to products

62

Approximately twenty organisations were represented on the Standards Committee that developed the Standard

State and Territory legislation

The States and Territories have also enacted or agreed to enact complementary legislation to ensure that the WELS Scheme has comprehensive national coverage State and Territory legislation which is almost a mirror of the Commonwealthrsquos Water Efficiency Labelling and Standards Act 2005 enables the States and Territories to for example undertake certain responsibilities delegated to them by the Commonwealth Regulator appoint their own inspectors and enforce the WELS

Other features of WELS include

bull A product web database

bull With the exception of toilets no other products are required to meet mandatory water efficiency requirements (WES) but this may change over time The introduction of mandatory WES means that products not meeting the minimum performance requirements can not legally be sold

bull Products must be tested in accordance with the relevant Standard and must meet any minimum performance and water efficiency requirements in the Standard before they can be granted a WELS Water Rating label

bull It is up to manufacturers or their agents (eg importers in the case of imported products) to ensure that their products are correctly registered and labelled and comply with any other requirements of the Standard

There is a transition phase which gives manufacturers and importers time to test register and label products and to sell pre-existing stock From 1 January 2008 all products are required to display the WELS Water Rating labels irrespective of their date of supply

63

The WELS Water Rating label

Label Features

bull A star rating for a quick comparative assessment of the models water efficiency

bull Labels with 1 to 6 stars

bull Some products may also be labelled with a Zero Star Rated label which indicates that the product is either not water efficient or does not meet basic performance requirements

bull A productrsquos water consumption figure

bull There are provisions for swing tags if there is inadequate surface area for label or the item is likely to be marked by sticking the label on the product

Summary Mandated product labelling using lsquostarrsquo rating system Has a disendorsement label and has provisions to ban products

33 Gas Appliance Rating Scheme

Purpose

A gas labelling program to improve the energy efficiency of gas powered products

Background and Strategy

The Gas and Fuel Corporation of Victoria introduced energy labelling for gas water heaters in 1981 This scheme was taken over by the AGA in 1985 who in 1988 introduced a six star energy performance label This label was intended to be visually consistent with the star rating labels already familiar to consumers of electrical appliances

The labelling scheme is currently voluntary and still administered by the industry body

A range of gas appliances have been subject to minimum energy performance standards (MEPS) since the 1960s The current MEPS levels were set in 1983 and

64

Brand Model Type MjyearStar

RatingSRI

StorageCapacity

(ltrs)IndoorOutdoor

NaturalGas

Instantaneous 18969 59 I N

Instantaneous 18969 59 I N

lsquothe majority of models currently on the market appear to exceed current requirements by a comfortable marginrsquo (SEAV 2003 p 23)

The gas energy labels are similar in format to those found on electrical appliances except they are blue and show annual energy use in MJ

A trial web site listing gas water heaters available in Australia is also available (see below)

Bottle Gas

Rinnai Infinity

V Series

REU-V2632FFU-A (Infinity 26 plus internal) P

Rinnai Infinity

V Series

REU-V2632FFUC-A (HD2001 internal) P

A joint review of the scheme is under way by the Gas Industry and Governments and regulation is under consideration A three year work plan has been published under the Australian and New Zealand Appliance and Equipment Energy Efficiency Program

Summary Currently voluntary labelling using lsquostarrsquo rating system with mandatory minimum energy performance standards Future regulation is under consideration

34 Green Vehicle Guide

Purpose

To provide web-based comparable and accessible environmental data on new motor vehicles

Background and strategy

65

The Commonwealth government started publishing a booklet of fuel consumption data for new passenger and light commercial vehicles in the early 1980s and a low cost web database in more recent years

In 2004 the Government through the Department of Transport and Regional Services (DOTARS) expanded the fuel consumption guide into the Green Vehicle Guide The Green Vehicle Guide is a web based database that rates new passenger and light commercial vehicles on air pollution greenhouse emissions and fuel consumption and gives an overall lsquostarrsquo rating for each vehicle within each vehicle category (small medium luxury sports etc)

The data on which the scores are derived are provided voluntarily by the vehicle manufacturers however this data is based on mandatory Australian Design Rule certification test data

The Guide uses a 5 star rating system however it also assigns half stars resulting in a total of 10 levels

The Greenhouse Ratings are based on carbon dioxide emissions and the Air Pollution Ratings take into account the relative environmental impact of oxides of nitrogen hydrocarbons and particles The relative harmfulness of the pollutants (shown in table below) has been quantified based on the allowable concentrations under the Ambient Air Quality National Environment Protection Measure (NEPM)

Green Vehicle Guide Weighting of Regulated Vehicle Emissions

Vehicle Emission

(equivalent pollutant under Air NEPM)

Calculated

Relative

Harmfulness

Final

Weighting

Carbon Monoxide (CO) 0088 Not included

Oxides of Nitrogen (NOx) (based on

Nitrogen Dioxide)

4 1

Hydrocarbons (HC) (based on

photochemical oxidants as ozone)

5 1

Particulate Matter (PM) (based on PM10) 20 5

Source Real and Jones 2005

NOx and HC were given equal final weightings despite the slight difference in the calculated relative harmfulness primarily because under ADR7900 a combined HC+NOx limit is prescribed rather than individual limits for each pollutant

The higher weighting for particulate matter recognises its significant health impacts The Air Pollution rating scale was devised in such a way that a lsquotypicalrsquo car (that is most petrol engined passenger cars meeting the current emission standard at the time) receives a mid-point rating (5 out of 10)

66

The overall rating or stars is derived from the sum of the air pollution and greenhouse scores ie they are equally weighted

Development of the Green Vehicle Guide (see extract below) involved extensive consultation with vehicle manufacturers

Website Costs

The new highly automated web database which contains data on approximately 1400 vehicles and has sophisticated search facilities cost approximately $200000 to develop plus around $100000 was spent recently to improve the sitersquos usability This compares to the previous low cost database which together with the printed guide cost less than about $80000 per annum The low cost version lacked the automation was only updated annually and did not have the ability to compared vehicles

The manufacturers provide the data on line using special access codes This data is checked by DOTARS before it is uploaded onto the website It takes close to a full time position within DOTARS to administer the website and respond to website related queries

Market Research and Marketing

Before the new greenvehicleguidegovau website was launched DOTARS commissioned consumer surveys to determine the level of knowledge about the environmental impacts made by vehicles This research showed that around half of those surveyed had the belief that ldquoall new cars have the same level of impact on the environmentrdquo

It became apparent through the surveys that there was a need to provide consumers with meaningful information on the relative performance of different vehicles This was a view shared by the Productivity Commission who said that while markets provide extensive information to consumers regarding fuel consumption of motor vehicles ldquothe Australian Governmentrsquos Fuel Consumption Labelling Scheme and Green Vehicle Guide provide relatively low cost accessible and comparable information to consumers and may be justified as part of the more fundamental objective of encouraging consumers to reduce the adverse environmental impacts of motor vehicle userdquo The Productivity Commission also commented that government

67

sources of information of this type were seen as credible and reliable and held in higher regard than information provided by others

DOTARS has scheduled some follow up consumer research for 200062007

DOTARS has spent about $600000 in marketing the Green Vehicle Guide This has included advertising in weekend guides in newspapers developing facts sheets plus targeted marketing to motor vehicle journalists

Summary Website - voluntary but legislative base

4 Government-Industry Partnership programs

Government-Industry Partnerships are the basis of many environmental initiatives and can take a number of forms Industry and government negotiate the terms of the program which are normally detailed in a formal agreement which sets out the environmental objectives and the responsibilities of each party towards their achievement

The GovernmentIndustry Partnership programs outlined below indicate the varied nature of these initiatives

41 The National Packaging Covenant

The National Packaging Covenant (the Covenant) commenced in 1999 and is a voluntary agreement between all levels of government and companies throughout the packaging chain including raw material suppliers packaging producers and retailers The Covenant commits signatories to the implementation of best practice environmental management in areas such as packaging design production and distribution and research into life cycle issues Signatories to the Covenant produce action plans on the measures they will implement to reduce packaging waste and they report annually on their progress In this sense the Covenant provides flexibility to signatories to develop plans suitable to their own circumstances The Covenantrsquos success (it currently has over 600 signatories) is due to the active promotion of it by Government and key industry players

The Covenant is complemented by a regulation the National Environment Protection (Used Packaging Materials) Measure (the NEPM) which enables states and territories to use enforcement action to require companies that donrsquot sign the agreement to take steps to reduce their packaging waste Preceding the Covenant and the NEPM were a number of voluntary industry agreements but these were limited in scope and largely focused on companies in the beverage industry

42 National Industry Reduction Agreement

The Publishers National Environment Bureau (PNEB) was formed in 1990 as an association of the major publishers of newspapers and magazines in Australia to promote the recovery and recycling of old newspapers and old magazines primarily from community kerbside collections organised by local councils

68

The PNEB and a newsprint manufacturer have voluntarily entered into a series of five-year Industry Waste Reduction Agreements with the Commonwealth and State Governments Under the current (third) plan 2001-2005 newsprint recycling in Australia has grown to 754 nationally in 2005 from the 28 level when the PNEB was formed in 1990

43 StateLocal target based programs

There have been a number of agreements signed by state government departments and an industry group where there is a stated goal to reach a specific environmental target For example in the early 1990s there was a voluntary agreement with the EPA Victoria and companies in the Altona Chemical Complex in the western suburbs of Melbourne (which includes Australian Vinyls BASF Dow Chemicals and Qenos) to reduce hydrocarbon emissions by 50 within a specified timeframe The target was met and further emissions reductions were negotiated The NSW EPA-Oil industry petrol volatility agreement outlined below is another example of a target based program

44 NSW EPA-Oil Industry Memorandum of Understanding on Summer Petrol Volatility

In 1998 NSW established arrangements for the supply of low volatility petrol in summer in the Sydney Greater Metropolitan Region implemented through a Memorandum of Understanding between the then EPA and oil companies The principal reason for controlling petrol volatility in summer is to reduce evaporative emissions of VOCs (from vehicles and production and storage sites) which contribute to ozone formation

The Memorandum of Understanding operated over four summer periods from 1998 to 2002 and involved companies voluntarily reducing petrol volatility (measured in kilopascals (kPa) of vapour pressure) over three summer periods from a base of 76kPa to 70kPa in the first summer 67kPa in the second and 62 kPa in the last two years

Although the Memorandum of Understanding was successful in progressively reducing petrol volatility over the period of its operation it was not supported by all industry members Consequently agreement was reached with industry that summer petrol volatility limits should be regulated to ensure a level playing field for all industry participants and regulated limits will apply from the summer of 200405

69

5 Summary of Australian Benchmark Programs

Program National State

Summary of Approach Impact

Voluntary Programs Altona Chemical Complex (Vic)

Local Small industry group worked towards self determined targets

Very high

Energy Star National Standards based label Limited Gas appliance Rating Scheme

National Industry operated labelling scheme with stars assigned therefore has graded benchmarksminimum performance standards out dated web database being developed

Low

National Industry Reduction Agreement

National Small industry group worked towards negotiated targets

High

NSW EPA-Oil Industry MOU

State Small industry group worked towards negotiated targets but not all involved ndash lead to regulations

Moderate

Top Energy Saver Award

National Achievement based label Limited

Quasi Regulatory Green Vehicle Guide

National Well promoted web database star ratings assigned therefore has graded benchmarks data provided voluntarily but backed by ADR requirements

High

Stand-by power National Required to achieve voluntary targets or regulation will be introduced

Unknown

National Packaging Covent

National Performance based targets backed by legislation High

Regulatory Energy Efficiency Labels

National Labelling scheme with stars assigned therefore has graded benchmarksbased on Australian Standard web database

High

MEPS National Sets base benchmark and works with energy rating

High

WELS Scheme National Labelling scheme with stars assigned therefore has graded benchmarksbased on Australian Standardweb database

High

Wood heaters State Only one benchmark assigned regulations are not uniform

Moderate

authorrsquos assessment based on direct or indirect knowledge of these programs

70

Appendix 3 Productivity Commission Comments on Labelling and Minimum Performance Standards

The Productivity Commission an independent agency which is the Australian Governmentrsquos principal review and advisory body on microeconomic policy and regulation recently examined the cost effectiveness of improving energy efficiency As part of its review lsquoThe Private Cost Effectiveness of Improving Energy Efficiencyrsquo it examined labelling programs minimum mandatory energy efficiency requirements and other means of providing consumer information The final report contains some highly relevant material that is applicable to establishing a benchmarking scheme for small engines

The following is a summary of relevant conclusions from the Inquiry

Government Operated Labelling Schemes

From consumer research provided to the Commission it concluded that ldquothere is some evidence to suggest that consumers are now paying more attention to labels than they have in the pastrdquo

The Commission was positive about labelling programs as labels

bull directly address ldquoa source of market failure mdash the asymmetry of information between buyers and sellers of energy-using productsrdquo

bull provide information to the consumer that is readily-accessible and easily-understood and therefore can assist in helping the consumer make better-informed choices

bull are likely to have produced net benefits for consumers

bull do not directly limit consumer choice

bull could provide a greater incentive for suppliers to sell products that use energy cost effectively

bull probably produced net social benefits

bull are most suited where there is a wide spread in the range of performances of comparable appliances and where information failures are most pronouncedrdquo

bull can be used to warn consumers that an appliance is very inefficient (through a disendorsement label) which could be effective in discouraging but not preventing consumers from buying the poor performing product

The Commission was supportive of Governmentrsquos role of drawing together and packaging information through labelling programs as this ensures that ldquorelevant and trusted information gets to those who would otherwise not get itrdquo In material reviewed by the Commission George Wilkenfeld and Associates and Energy Efficient Strategies (1999) claimed that labelling is unlikely to be effective if purchasers rarely inspect appliances in a showroom where they can compare performance across

71

different models or the purchaser is not the ultimate user and so has little interest in operating costs

Labelling programs involves both administration and compliance costs such as those incurred by suppliers in having their products tested but the Commission considered that labels should be more actively considered as an alternative to minimum performance standards

Minimum Performance Standards

Governments can prevent the sale of inefficient products by using minimum standards for example the Minimum Energy Performance Standards (MEPS) that apply to appliances such as refrigerators and freezers air conditioners and electric water heaters If appliances do not meet the minimum standard they cannot be sold in Australia Some appliances are covered by both MEPS and by labelling (for example refrigerators)

The Commission considered that MEPS and labels can be complementary as MEPS act to penalise the worst energy performers whereas labels rewarding the better performers

Costs comparisons of schemes

The Department of the Environment and Water Resources provided details about the costs involved in administering both the labelling scheme and the minimum performance standards for energy programs It stated that

bull the administration costs of MEPS are substantially lower than for labelling but the compliance costs can be higher

bull MEPS can have a greater cost for suppliers than labelling since suppliers must adjust their model ranges to meet the MEPS levels by the given date These compliance costs are however influenced by the lsquolead inrsquo time between the introduction of the regulatory proposal and the implementation of the MEPS

bull it is estimated that the administration costs for MEPS would be $3 million over the period 2000ndash15 compared to $39 million for labelling (in present value terms) (George Wilkenfeld and Associates and Energy Efficient Strategies 1999) Furthermore it was assumed that 84 per cent of administration costs were borne by appliance purchasers with the remainder borne by governments

It estimated that MEPS would increase the cost of appliances by $266 million over 2000ndash15 compared to $688 million for labelling (the latter cost being due to consumers voluntarily purchasing more efficient appliances)

72

Page 2: Outdoor Garden Equipment - Department of the Environment

Disclaimer The research reported in this document was commissioned by the Environment Standards Branch of the Department of the Environment and Water Resources

The views and opinions expressed in this publication are those of the authors and do not necessarily reflect those of the Australian Government or the Minister for the Environment and Water Resources

While reasonable efforts have been made to ensure that the contents of this publication are factually correct the Commonwealth does not accept responsibility for the accuracy or completeness of the contents and shall not be liable for any loss or damage that may be occasioned directly or indirectly through the use of or reliance on the contents of this publication

Acknowledgments This report was prepared for the Department of the Environment and Water Resources and the contribution made by Officers of the Department is acknowledged

The comments on the draft report and other project discussion documents made by members of the Small Engines Expert Panel Outdoor Equipment were appreciated and considered in finalising this report The Panel had representation from

Industry Allpower Industries Stihl Pty Ltd Briggs amp Stratton Honda Australia Motorcycle amp Power Equipment Pty Ltd Victa Lawncare Pty Ltd Rover Mowers Limited Roy Gripske amp Sons Pty Ltd Parklands Trading Co Pty Ltd Kawasaki Motors

Associations Outdoor Power Equipment Association

Government Department of the Environment and Water Resources NSW Department of Environment and Conservation Environment Protection Authority Victoria The Northern Territory Department of Natural Resources Environment and The Arts

In addition overseas government and industry colleagues provided useful feedback and information during the project

i

Contents

Disclaimer i

Acknowledgmentsi

Abbreviations and Glossaryii

Executive Summary iii

1 Introduction1

11 Emissions from outdoor garden equipment engines1

2 Air Quality and Outdoor Garden Equipment Engines4

21 Air Quality Standards 6

3 Emission Standards for Small Engines 8

31 Australia8 32 United States 8 33 Canada12 34 Europe 13 35 Summary of Regulations for Non Handheld Equipment15 36 Summary of Regulations for Handheld Equipment16

4 Australian Market for Small Engines 18

41 Likely compliance with overseas emissions standards18 42 Australian Sales of Outdoor Powered Equipment 22

5 Australian Users of Small Engines 25

51 General Public25 52 Garden and Ground Maintenance Services27 53 Government Purchasing28

6 Result of Stakeholder Consultation 30

61 Regulations 30 62 Discussion on recommended regulations31

7 The Way Forward 35

71 Options to Reduce Emissions from Garden Equipment Engines 38 72 Option 1 ndash Do Nothing 39 73 Option 2 ndash Industry - Government Partnership39 74 Option 3 - Quasi Regulation 39 75 Option 4 -Co Regulation40 76 Option 5 - Regulation40 77 Preferred Approach44

References 45

ii

Appendix 1 Detailed Breakdown of Powered Garden Equipment on the Australian Market 51

Appendix 2 Examples of Current Australian Benchmarking Programs55

Appendix 3 Productivity Commission Comments on Labelling and Minimum Performance Standards 71

iii

List of Figures

Figure 1 Example of a Californian Consumer Advisory Hang Tag11

Figure 2 Extract from survey form18

Figure 3 Compliance with overseas standards - all surveyed products20

Figure 4 Compliance with overseas standards by equipment type21

Figure 5 Engine type for popular categories 21

Figure 6 Compliance with overseas standards for popular categories 22

Figure 7 OPEA estimates of equipment sales in 2005-0624

List of Tables

Figure 1 Example of a Californian Consumer Advisory Hang Tag11

Figure 2 Extract from survey form18

Figure 3 Compliance with overseas standards - all surveyed products20

Figure 4 Compliance with overseas standards by equipment type21

Figure 5 Engine type for popular categories 21

Figure 6 Compliance with overseas standards for popular categories 22

Figure 7 OPEA estimates of equipment sales in 2005-0624

i

Abbreviations and Glossary 2c Two stroke with carburettor 2di Two stroke with direct fuel injection 2i Two stroke with pre-chamber fuel injection 4c Four stroke with carburettor 4i Four stroke with fuel injection (includes direct injection) ABS Australian Bureau of Statistics ABT Averaging Banking and Trading of emissions ADR Australian Design Rule Air NEPM National Environment Protection Measure for ambient air quality BTEX Benzene toluene ethylbenzene xylenes - carcinogenic or mutagenic aromatic

hydrocarbons formed through the combustion process CARB Californian Air Resources Board CBA Cost Benefit Analysis cc Cubic centimetres CO Carbon Monoxide DEC Department of Environment and Conservation di Direct Injection efi Electronic fuel injection EU European Union Euromot The European Association of Internal Combustion Manufacturers gkW- hr Grams per kilowatt hour HCs Hydrocarbons ndashmost are VOCS and in relation to small engines the terms are

often used interchangeably hp Horsepower 1 hp =7457 watts ISO International Standards Organization kW Kilowatts MEPS Minimum Energy Performance Standards MOU Memorandum of Understanding NATA National Association of Testing Authorities NOx Oxides of Nitrogen NPI National Pollutant Inventory NSW GMR New South Wales Greater Metropolitan Region which includes Sydney Lower

Hunter and Illawarra regions encompassing the major metropolitan centres of Sydney Newcastle and Wollongong Population approximately 47 million

OPEA Outdoor Power Equipment Association PM10 Particles with an aerodynamic diameter of 25 micrometres or less PM25 Particles with an aerodynamic diameter of 10 micrometres or less Port Phillip Region in Victoria of 24000 km2 that includes Greater Melbourne and Greater Region Geelong It is defined in Victorian environmental policy Population

approximately 34 million (1996) SE Qld South East Queensland - a region that covers the area from the Gold Coast to the

Sunshine Coast and west to Toowoomba It includes Brisbane amp suburbs population approximately 23 million people

USEPA United State of America Environmental Protection Agency VOCs Volatile Organic Compounds WELS Water Appliances Water Efficiency Labelling and Standards Scheme

ii

Executive Summary

Background

This report sets out the results of a project to compare and benchmark emissions from small petrol engines (less than 19 kilowatts) that are used to power outdoor garden equipment and were available for sale in Australia during 2006 The equipment powered by these small engines are used in lawnmowers brushcutters hedge trimmers and the like

These engines emit volatile organic compounds (VOCs) and oxides of nitrogen (NOx) which contribute to ozone (photochemical smog) formation in summer They also emit particles carbon monoxide (CO) and a range of air toxics such as benzene

Sydneyrsquos Greater Metropolitan Region (GMR) annually records exceedances of the National Environment Protection (Ambient Air Quality) Measure (Air NEPM) ozone standards The other jurisdictions meet or are close to meeting the current ozone standards

The Air NEPM standards are being reviewed and based on current human health evidence the argument appears to be strengthening for tighter ozone standards Should a stricter standard or an eight-hour standard consistent with international standardsguidelines be adopted achievability of Air NEPM ozone standards or goals could become an issue for some of the other major urban airsheds

The United States California Canada and Europe regulate emissions from outdoor equipment - the USA has had these in place since 1997 There are no Australian regulations or standards that limit air pollutant emissions from engines used in outdoor garden equipment however as the majority of equipment sold in Australia is imported some do comply with emission standards applicable to the country of origin

Small engines are not as advanced in environmental terms as motor vehicle engines As a result even the better-performing small engines emit far greater quantities of pollutants per hour than typical modern car engines For example the US Environmental Protection Agency (USEPA) 2002 limit for a typical 4 kilowatt (kW) lawnmower motor is about 66 grams (g) of regulated pollutants per hour of operation A typical 08kW brushcutter sold new in 2002 emitted about 160grams of pollutants per hour - reducing to 40grams per hour if bought new in 2006 The equivalent limit for cars under Australian Design Rule 79 is about 16g per hour In other words one hour of operation of a brushcutter that meets USEPA 2002 limits produces the same pollution as ten cars operated over a similar time These comparisons are subject to differences in test methods but they do provide an indication of the disproportionate amount of pollution emitted by small engines

Engines that do not comply with current USEPA requirements are likely to emit several times the amount of pollution calculated in the above example Therefore the worst performing engines are likely to emit more than ten times the emissions of the best performers

iii

Based on estimates made using the National Pollutant Inventory database engines used in lawn mowers contribute approximately 4 on average to VOC emissions from anthropogenic sources in major airsheds in Australia when public open space lawn mowing is included This is likely to rise to around 11 in the warmer spring and autumn weekends which is when lawns and other vegetation grows faster and when gardening is more popular The NPI does not take into account emissions from other types of powered outdoor equipment

The Australian Market

According to the Outdoor Power Equipment Association (OPEA) approximately 424000 walk behind lawnmowers and more than 792000 units of outdoor handheld equipment were sold in Australia in 2005-06 In addition there were sales of about 80000 replacement engines and 70000 pumps in 2005-06 most of which were four strokes The general household consumer represents the major market segment for garden equipment accounting for up to 90 of product sales with commercial garden services and government purchasing the rest

Indications are that sales of imported high polluting two stroke engines have increased over the last few years and it appears that the price of some powered garden equipment has dropped to the level where consumers regard them as disposables

An assessment of outdoor equipment on the Australian market found that the majority of small engines sold in Australia are imported and many come from countries that impose emission limits The extent of imports into Australia that do not comply with the country of origin standards is not known However the industry estimate that 40 of garden products are sold through importers who are not linked to manufacturers of US EPA or European certified equipment and the source of some products sold here is difficult to establish Victa is the only company producing small engines in Australia Its iconic 2-stroke lawn mower engine currently does not meet overseas emission limits for non-handheld equipment and Victa is undertaking research and development to reduce emissions from its two stroke engine to meet US and European standards

In spite of several attempts to obtain data on compliance with overseas emission standards from Australian distributors their response was poor The following figure therefore provides a best estimate of expected compliance of outdoor equipment on the Australian market with European CARB or USEPA requirements applicable in 2004

iv

Figure E1 Compliance with overseas standards for popular categories ldquoPhase 1 equivrdquo means the engine complies with US EPA phase 1 or 200288EU ldquoPhase 2 equivrdquo means the engine complies with US EPA Phase 2 Euro I or Euro 2 ldquoUnknown means that engine cycle (stroke) was not provided

Measures to Increase Sales of Low Emission Garden Equipment Engines

There is a range of options that could be considered for reducing emissions from engines used in outdoor garden equipment engines in Australia These include

1 Maintaining the Status Quo

2 Government ndash Industry Partnership Program

3 Quasi regulation

4 Co-regulation

5 Regulations based on either a simple benchmark or tiered benchmarks

The Small Engine Expert Panel ndashOutdoor Equipment has considered in depth the most appropriate approach to take to improve the emissions performance of outdoor garden equipment sold in Australia It recommends the introduction of national regulations to control the emissions from outdoor garden equipment particularly in light of the increase in cheap imports onto the Australian market which although untested are considered very likely to have high emission levels The Expert Panel has developed some broad recommendation on which Australian regulations could be based which takes in consideration the local market and Victa These are summarised as follows

1 Mandatory air pollutant emission standards to be introduced in Australia for all outdoor equipment (lt19kW) powered by spark-ignition engines

v

The development of any regulation would need to be based on a formal assessment of the costs and benefits of nationally regulating two and four stroke lawn mowers and handheld power equipment which should commence immediately

2 Proposed standards to mirror US EPA regulations (compliance with equivalent EU regulations also acceptable)

3 Timing (subject to completion of assessment of costs and benefits)

(a) US EPA Phase 1 ndash Effective from 20072008

(b) US EPA Phase 2 ndash Fully implemented in 2012 (in step with 2007 USEPA limits) plus a phase-in period andor provisions for averaging banking and trading (ABT) of emissions over 2008-2012 to provide for early introduction of cleaner product

The US EPA Phase 1 and Phase two emissions limits are given in the table below

4 Walk-behind two stroke mowers to be included in US EPA Category 5 (gt50cc) product classifications (to provide Victa time to develop a cleaner engine) Implementation timing is proposed to be the same as Recommendation 3 above

5 All products also to be certified to relevant EPA product durability categories

6 Subject to further review ABT if included may be phased out after 2012

Table E1 Comparison between the USA Phase 1 and Phase 2 standards

Emission Limits GkW-hr

Phase 1 (1997 ndash2001) Phase 2 (2007) HC NOx HC+NOx CO HC+NOx CO

Non-handheld

I-A lt66cc 161 161 610

I-B 66-lt100cc 161 161 610

I 100-225 cm3 161 519 161 610

II 225 cm3 134 519 121 610

Handheld

III lt20 cm3 295 536 805 50 805

IV 20-50 cm3 241 536 805 50 805

V 50 cm3 161 536 603 72 603 Phase 2 limits were phased in between 2002 -2007 during which time they became tighter

For simplicity only the 2007 are shown in this table (see Table 2 for more details)

vi

Conclusion

From this review it is apparent that it is highly unlikely that the companies in the industry would engage in or commit to any voluntary type program It is therefore clear that the most expedient path to reduce emissions from these small engines is through national regulation State based regulations could only provide a piecemeal approach that would lead to product dumping in states where there are no regulations and inconsistent regulations that require industry to treat each state market differently In addition enforcement of any state based regulations would be a key problem due to existing Commonwealth and State Government mutual recognition legislation

While any national regulation of emissions from small engines used in garden equipment in Australia are likely to be based on overseas regulations they need to strike a balance between improved environmental outcome harmonisation with international standards and the characteristics of the local industry With regulations optimum emissions reduction are potentially achievable by combining minimum emissions standards with tiered product labelling Whether this approach is justifiable on economic grounds that is the benefits outweigh the costs can only be determined through a detailed impact assessment Based on these findings it is recommended that a formal assessment of the costs and benefits of nationally regulating two and four stroke lawn mowers and handheld power equipment should be commenced

vii

1 Introduction

This report sets out the results of a project to compare and benchmark emissions from engines used in outdoor garden equipment that were available for sale in Australia during 2006 Possible outcomes from the project range from consumer guidelines for selecting low emission engines to regulatory controls on emissions There are currently no state or national regulations that directly control emissions from these engines

The project was commissioned by the Commonwealth Department of the Environment and Water Resources on behalf of state and territory government departments working on reducing the impacts of small engine emissions This report was prepared in consultation with an Expert Panel that included representatives from the Outdoor Power Equipment Association (OPEA)

11 Emissions from outdoor garden equipment engines

Small engines particularly conventional two stroke engines used in applications such as outdoor garden equipment are high polluters relative to their engine size and usage1 These small engines emit volatile organic compounds (VOCs) and oxides of nitrogen (NOx) which contribute to ozone (photochemical smog) formation in summer They also emit particles carbon monoxide (CO) and a range of air toxics such as benzene The USA California Canada and Europe and regulate emissions of VOCs NOx carbon monoxide and particle emissions from outdoor garden equipment

There are five types of spark-ignition engines that can be used in outdoor garden equipment

bull two stroke with carburettor (2c)

bull two stroke with pre-chamber fuel injection (2i)

bull two stroke with direct fuel injection (2di)

bull four stroke with carburettor (4c)

bull four stroke with fuel injection (4i) (includes direct injection)

Carburettor and pre-chamber fuel injection two stroke engines are inherently more polluting than the other three types This is due to their inability to completely separate the inlet gases from the exhaust gases resulting in up to 30 of the fuel being left unburnt and the need to add oil to the fuel to lubricate the engine (four stroke engines have separate reservoirs for fuel and oil) However twostroke carburettor engines typically weigh less than a four stroke engine of the same power and this tends to make them attractive for handheld equipment They also tend to have fewer components are generally cheaper to purchase and are cheaper to maintain than

1 Outdoor equipment covered in this report are engines less than 19kW

1

four stroke motors Victa Lawncare is currently undertaking research and development to improve the environmental performance of two stroke carburettors and while some emission improvements have been made a two stroke compliant with US or European standards is still considered several years away

Four stroke carburettor engines are generally quieter more fuel efficient and are less polluting than conventional two stroke engines

Direct fuel injection (dfi) either two stroke or four stroke overcomes the unburnt fuel problem and can meet the stringent regulated exhaust emission limits that apply overseas However there is not any evidence that dfi engines are being used in outdoor garden equipment available in Australia It appears that engines used in outdoor garden equipment in Australia are generally restricted to two and four stroke carburettor engines

Small engines are not as advanced in environmental terms as motor vehicle engines As a result even the better-performing small engines emit far greater quantities of pollutants per hour than typical modern car engines For example the US Environmental Protection Agency (USEPA) 2002 limit for a typical 4 kilowatt (kW) lawnmower motor is about 66 grams (g) of regulated pollutants per hour of operation A typical 08kW brushcutter sold new in 2002 emitted about 160grams of pollutants per hour - reducing to 40grams per hour if bought new in 2006 The equivalent limit for cars under Australian Design Rule 79 is about 16g per hour In other words operated over a similar time one hour of operation of a brushcutter that meets USEPA 2002 limits produces the same pollution as ten cars and a 4kW lawnmower the same pollution as four cars These comparisons are subject to differences in test methods but they do provide an indication of the disproportionate amount of pollution emitted by small engines

Engines that do not comply with current USEPA requirements are likely to emit several times the amount of pollution calculated in the above example Therefore the worst performing engines are likely to emit some ten times the emissions of the best performers

Because of the combustion of oil these engines also emit high levels of particles Although small engines only contribute a small amount to total particle emissions the rate of particle release compared to other engines can be very high For example lawnmowers can emit over 10 times more particles (in terms of grams per hour) than a petrol motor vehicle (manufactured between 1994 and 2001)

All the above emission comparisons between outdoor garden equipment engines and motor vehicles are subject to differences in test methods but they indicate the disproportionate amount of pollution emitted by small garden equipment engines It also needs to be recognised that motor vehicles in Australia average more than 15000 kilometres per year (ABS 2003) while the annual average use of outdoor garden equipment is around 25 hours for a lawnmower and less for other types of equipment Commercial operators however are likely to have a much higher usage rates than the general public

2

This paper examines the Australian market for small engines used in lawnmowers and handheld garden equipment their impact on air quality relevant overseas regulations and their applicability to Australia and makes recommendations to reduce air quality impacts from these engines

A wide range of information sources has been referenced for this report including data and information supplied by manufacturers distributors and dealers in small engines

3

2 Air Quality and Outdoor Garden Equipment Engines

Emission inventories make estimates of emissions of substances from a multitude of sources into airsheds The National Pollutant Inventory (NPI) which is run cooperatively by the Australian state and territory governments contains data on 90 substances that are emitted to the Australian environment The substances included in the NPI have been identified as important because of their possible health and environmental effects Industry facilities estimate their own emissions annually and report to states and territories Non-industry (or diffuse) emissions estimates which includes emissions from outdoor garden equipment are made by the states and territories on a periodic basis using information sources such as surveys databases and sales figures

The NPI only reports emissions from domestic lawn mowing and for a few airsheds the contribution made by public open space lawn mowing It does not report on the contribution made by other types of outdoor garden equipment such as brushcutters National and selected state NPI emissions estimates for the common air pollutants and for Air Toxics NEPM pollutants from domestic lawn mowing are summarised in Table 1 It should be noted that national emissions from lawn mowing are underestimates as the NPI records emissions for major airsheds only and therefore is not Australia wide plus the estimates do not include evaporative emissions from fuel tanks and hoses

This NPI data is indicative only as the accuracy and completeness of the data sets varies across airsheds and is reliant on the estimation techniques used For example while the population in the NSW is higher than other airsheds its emissions look disproportionally high when compared to the other airsheds This could be because the estimation technique varies or it is due to some other factor

4

Table 1 National Pollutant Inventory Domestic Lawn Mowing Emission Estimates

Substance Port Phillip

Population 34 mill (1996)

SE Qld

Population 23 mill

NSW GMR

Population 47 mill

Adelaide

Population 10 mill

National

Common Air Pollutants (tonnesyear)

Carbon monoxide 12000 12000 24000 6100 69000

Total Volatile Organic Compounds 3600 3800 7000 2000 21000

Particulate Matter 100 um 86 94 170 9 460

Sulphur dioxide 5 5 9 50 81

Oxides of Nitrogen 63 54 120 24 330

Air Toxics (tonnesyear)

Benzene 230 210 390 130 1200

Formaldehyde 56 38 NA 31 180

Polycyclic aromatic hydrocarbons 07 11 21 04 41

Toluene (methylbenzene) 370 360 660 210 2000

Xylenes (individual or mixed isomers) 270 260 490 150 1500

Analysis of the NPI database at the national level shows that domestic lawn mowing is the

- Fourth largest source of benzene contributing 7 to the total reported airshed load

- Fourth largest source of formaldehyde contributing 3 to the total reported airshed load

- Fifth largest source of xylene contributing 6 to the total reported airshed load

- Fifth largest source of toluene contributing 6 to the total reported airshed load

- Sixth largest source of carbon monoxide contributing 12 to the total reported airshed load

- Ninth largest source of VOCs contributing 3 to the total reported airshed load when biogenics (natural sources such as trees and soil) are excluded

The NSW Department of Environment and Conservation has been upgrading its emissions inventory Based on 2003 emissions data non-road anthropogenic sources

5

contribute 619 of the VOCs to the GMR airshed Preliminary results2 indicate that VOC emissions from domestic and public open space lawn mowing contributes on an annual average 41 of all VOC emissions in the GMR On a typical weekend during warmer weather this percentage rises to 11

Therefore it could be assumed that lawn mowing could contribute approximately 4 on average to VOC emissions from anthropogenic sources in major airsheds in Australia when public open space lawn mowing is included This percentage is likely to rise significantly in the warmer spring and autumn weekends which is when lawns and other vegetation grow faster and when more people garden

21 Air Quality Standards

In June 1998 the National Environment Protection Measure for Ambient Air (Air NEPM) established national uniform standards for ambient air quality for the six most common air pollutants ndash carbon monoxide nitrogen dioxide photochemical oxidants (measured as ozone) sulfur dioxide lead and particles less than 10 microns (PM10) The NEPM was varied in 2003 to include PM25 advisory reporting standards and in April 2004 a National Environment Protection Measure for Air Toxics was adopted

Nationally the common pollutants of most concern (particularly in major urban areas) are fine particles and ground level photochemical smog (measured as ozone) which is formed in the warmer months when volatile organic compounds (VOCs) and oxides of nitrogen (NOx) react in the atmosphere under the influence of sunlight in a series of chemical reactions

Recent health studies (cited in NEPC 2005) have strengthened the evidence that there are short-term ozone effects on mortality and respiratory disease The studies also strengthen the view that there does not appear to be a threshold for ozone below which no effects on health are expected to occur In recent years Australian epidemiological studies have been conducted which confirm the results of overseas studies that there is a relationship between elevated ozone levels and hospitalisations and deaths from certain conditions

There are two national ozone standards a one hour standard of 010ppm and a four hour standard of 008ppm with a goal that allows for one exceedance per year by 2008 Sydney experiences a number of days each year of ozone levels above these standards In 2003 Sydney exceeded the one hour standard on 11 days in 2003 19 days in 2004 and 9 days in 2005 The four hour standard was exceeded on 13 days in 2003 19 days in 2004 and 13 days in 2005 Further reductions in VOC and NOx emissions are needed to reduce ozone concentrations in Sydney to levels that would comply with the Air NEPM

The other jurisdictions meet or are close to meeting the current National Environment Protection (Ambient Air Quality) Measure (Air NEPM) ozone standards (NEPC 2005) However the ozone standards are being reviewed and based on current human health evidence the argument appears to be strengthening for tighter ozone standards

2 Presentation to Expert Panel 27 April 2006 by Nick Agipades Manager Major Air Projects NSW DEC

6

Should a stricter standard or an eight-hour standard consistent with international standardsguidelines be adopted achievability of Air NEPM ozone standards or goals could become an issue for some of the other major urban airsheds (NEPC 2005)

Modeling of ozone for Sydneyrsquos Greater Metropolitan Region (GMR) indicates that the implementation of Euro emission limits for on-road vehicles and hence the increased presence of these less polluting vehicles in the fleet and retirement of old more polluting vehicles from the fleet is not sufficient to meet the current NEPM goals Modeling suggests that very large reductions in precursor emissions would be required to meet the current ozone one hour goal (NEPC 2005)

Even when the effects of bushfires and when hazard reduction burning are taken into consideration airsheds such as Launceston Melbourne and Sydney struggle to meet the national standards for particles (EPA 2006) However outdoor powered equipment predominantly from two stroke engines makes only a minor contribution to ambient fine particle loads

While carbon monoxide emissions from engines used in outdoor garden equipment are regulated overseas air monitoring in Australia indicates that carbon monoxides levels are well below the national air quality standards and there are no pressing issues requiring CO from outdoor powered equipment to be regulated In addition data indicates that lowering emissions of VOCs and NOx from small engines reduces CO emissions

Many of the pollutant sources which contribute to the formation of ozone and to particle levels also contain air toxics such as benzene toluene formaldehyde and xylenes These air toxics have been shown to be responsible for a range of health problems including asthma respiratory illnesses and cancer The National Environment Protection Measure for Air Toxics requires each jurisdiction to monitor and report annually on five air toxics benzene polycyclic aromatic hydrocarbons formaldehyde toluene and xylenes The monitoring data is intended to inform future policy and also the public on ambient levels of these air pollutants Monitoring of air toxics to date shows that levels are low and below the national monitoring investigation levels (EPA Vic 2006 DEC 2006)

7

3 Emission Standards for Small Engines

31 Australia

At present there are no Australian regulations or standards to limit air pollutant emissions from small (two and four stroke) engines Australia does benefit to some extent from overseas regulations as many lawnmowers and other gardening equipment sold in Australia have engines manufactured in the United States or Europe where strict standards apply

32 United States

In the United States emission regulations set by the United States Environmental Protection Agency (USEPA) and the Californian Air Resources Board (CARB) apply to lawn mowers and other powered gardening equipment Although CARB standards currently tend to be stricter than USEPA standards by 2006 emissions limits applying under the two standards will be very similar

United States Environment Protection Agency (US EPA)

In 1995 the USEPA introduced ldquoPhase 1rdquo regulations covering small non-road engines with a power of not more than 19kW (25HP) The regulations applied to equipment manufactured from 1997

These regulations have seven classes of equipment based on portability and engine displacement volume (ldquocapacityrdquo) In March 2000 the USEPA published ldquoPhase 2rdquo regulations which are shown in Table 2 These set limits for combined emissions of hydrocarbons (HC) and oxides of nitrogen (NOx) and separate limits for carbon monoxide (CO) emissions and for two stroke engines only particles

Table 2 US EPA Phase 2 Small Engine Emissions Standards (HC+NOx in gkW-hr) (a) (b)

Small Engine Class

Type 2002 2003 2004 2005 2006 2007+

I-A (lt66cc) Non-handheld (eg lawnmowers)

- 161 161 161 161 161

I-B (66 to lt 100cc) - 161 161 161 161 161

I (100 to lt 225cc) - 161 161 161 161 161

II (225cc or more) 180 166 150 136 121 121

III (lt20cc) Handheld (eg trimmers)

238 175 113 50 50 50

IV (20 to lt50cc) 196 148 99 50 50 50

V (50cc or more) - - 143 119 96 72 (a) As carbon monoxide (CO) levels in Australia are well below the Air NEPM standard the

USEPA emission limits for CO have not been included in this table (b) Includes useful life criteria of 50125300 hours

8

When the USEPA introduced ldquoPhase 2rdquo regulations it included averaging banking and trading provisions (ABT) which were seen ldquoas an important element in making stringent Phase 2 emissions standards achievable with regard to technological feasibility lead time and costrdquo (USA 1999) The USEPA also claimed (USA 2000) that the ABT program secures early emissions benefits through the early introduction of cleaner engines

ABT provisions which apply to handheld and non handheld engines are complex but in broad terms averaging means the exchange of emission credits among engine families within a given engine manufacturerrsquos product line This allows a manufacturer to produce some engines that exceed the standards and offsetting these exceedances with emissions from engines that are below the standard Manufacturers are allowed to exchange credits from handheld to non handheld and vice versa Banking means the retention of emission credits by the engine manufacturer generating the credits for use in a future model year (for averaging or trading) Trading is the exchange of emission credits between engine manufacturers which then can be used for averaging purposes banked for future use or traded to another engine manufacturer

In January 2004 USEPA reported that in 2002 averaging was being used but there was very little use of banking It determined that the initial ABT programs as too complex and included discount rates on credits ABT was simplified in 2004 including the elimination of credit discount and multipliers and limits on credit life To date there has reportedly been limited use of banking however it is anticipated that there will be more widespread use of banking credits if the USEPA proposed Phase 3 comes into effect3 (see below)

Particulate limits (2gkW-hr) also apply to two stroke engines Carbon monoxide and durability limits (or useful life) are also prescribed The durability criteria which were introduced in Phase 2 require that the emission limits must be met through the useful life of the engine The manufacturer determines useful life of each product using standardised product testing procedures and then based on the test results selects the useful life category for each product which can be 125 250 or 500 hours These durability criteria acknowledge the large disparity in usage patterns by equipment type and between commercial and residential users It also takes into account the ability of manufacturers to design and build engines for various design lives and which fit the types of equipment engine is produced for

The March 2000 USEPA report (USEPA 2000) estimated that the expected effects of the Phase 2 regulations would be

bull A 70 reduction in HC+NOx beyond the Phase I standards (which were estimated to have reduced emissions by 32 from the unregulated baseline)

bull A 30 reduction in fuel consumption of small handheld equipment bull Price increases of between $US23 (Class III) and $US56 (Class V) for

handheld equipment

3 Dave Gardner Briggs and Stratton email 22506

9

The US EPA is currently considering lsquoPhase 3rsquo regulations which are catalyst based standards to further reduce exhaust HC and NOx emissions from non handheld engines reduce evaporative HC and NOx emissions for both handheld and non handheld engines plus include extended durability criteria These limits are currently at discussion stage only They align with CARB Tier 3 but a longer lead time is proposed

Table 3 Proposed Phase 3 Exhaust Emissions

HC+NOx gkW-hr

CO gkW-hr

Year Useful life hrs

Class I 100 610 2010 125250500

Class II 80 610 2011 2505001000

Class III-V No changes

HC+NOx std is based on averaging

Californian Air Resources Board (CARB)

Spark ignition engines

CARB regulations first introduced emission limits for small engines manufactured from1995 The more recent schedule of emission limits are shown in Table 4 These limits depend solely on the engine capacity and apply to both handheld and non handheld classes

Table 4 CARB Emission Limits for Small Engines (HC+NOx in gkw-hr)

Engine Capacity 2000-2001 2002-2005 2006+

65cc or less 72 72 72

gt65cc to 225cc 161 161 161

gt225cc 134 121 121

California has particle limits for two strokes useful life criteria and mandatory engine labeling including a consumer advisory hang tag as shown in Figure 1 The USEPA is also considering introducing an air index label

10

Figure 1 Example of a Californian Consumer Advisory Hang Tag The Californian regulations take into account sales weighted emission performance for families of engines An engine family is essentially the same engine being used in different equipment items

In 2003 California adopted a Tier 3 program for exhaust and evaporative emissions and these are based on the use of catalytic convertors The engine classes better align with US EPA categories however the exhaust standards for Class I and Class II are more stringent than the existing US EPA standards

Table 5 CARB Tier 3 for Exhaust Emissions

Model Year Displacement Category

Durability Periods (hours)

HC+NOx gkw-hr

CO gkw-hr

Particulate gkw-hr

2005 and subsequent

lt50 cc 50125300 50 536 20 + 50-80 cc inclusive 50125300 72 536 20 +

2005 gt80 cc - lt225 cc Horizontal-shaft eng

125250500 161 549

gt80 cc - lt225 cc NA 161 467 Vertical-shaft Engine 225 cc 125250500 121 549

2006 gt80 cc - lt225 cc 125250500 161 549 225 cc 125250500 121 549

2007 gt80 cc - lt225 cc 125250500 100 549 225 cc 125250500 121 549

2008 and subsequent

gt80 cc - lt225 cc 125250500 100 549 225 cc 1252505001000 80 549

the 1000 hours is applicable for 2008+ Model Year (MY) + applies to 2 stroke only Source California Exhaust Emission Standards and Test Procedures For 2005 And Later Small Off-Road Engines Adopted July 26 2004 effective on October 20 2004

California also has Blue Sky provisions These are voluntary standards for engines that meet the criteria shown in Table 6 Blue Sky Series engines are not included in

11

the averaging banking and trading program Zero-emission small off-road equipment (eg push mowers) may certify to the Blue Sky Series emission standards

In 2005 CARB aligned its test procedures with the USEPA

Table 6 CARB Blue Sky Provisions

Model Year Displacement Category

HC+NOx gkw-hr

CO gkw-hr

Particulate

2005 and subsequent lt50 cc 25 536 20

50 - 80 cc inclusive 36 536 20

2007 and subsequent gt80 cc - lt225 cc 50 549

2008 and subsequent 225 cc 40 549 Applicable to all two stroke engines

33 Canada

The Canadian small engine market has similarities to the Australia market the majority of small engines are imported from the USA and there is one Canadian manufacturer of small spark ignition engines and one major manufacturer of lawn and garden machines

A Memorandum of Understanding (MOU) which came into effect on 1 January 2000 was signed between Environment Canada and ten manufacturers of handheld equipment and nine manufacturers of engines used in non handheld machines The MOU was intended as an interim measure until regulations could be put in place Under the MOU the manufacturers agreed to voluntarily supply small spark ignition engines designed to meet the applicable USEPA Phase 1 emission standards

In 2003 Canada regulated emission limits for handheld and non-handheld small engines based on USEPA emission limits The regulations apply to model years 2005 and later While there are no separate averaging banking and trading provisions in Canadian regulations Canada allows any USEPA certified engine to be sold in Canada This means that engines that do not meet the standard level but are averaged (or use credits) in the United States can be sold in Canada Manufacturers are required to produce upon request evidence of conformity to the standards and are required to provide written instructions on engine maintenance to the first retailer

12

Table 7 Canadian Small Spark-Ignition Engine Exhaust Emission Standards

Engine class

Engine Type

Engine Displacement (cm3)

Effective date (model year)

Standard HC+NOx (gkWshyhr)

Standard NMHC+NOx (gkW-hr)

Standard CO (gkWshyhr)

I-A Non-handheld lt66 2005 and

later 50a -shy 610a

I-B Non-handheld

lt100 and 66

2005 and later

40a 37a 610a

I Non-handheld

lt225 and 100

2005r 161b 148a 519b 610a

II Non-handheld 225 2005 and

later 121a 113a 610a

III Handheld 20 2005 and later 50a -shy 805a

IV Handheld lt50 and 20 2005 and later

50a -shy 805a

V Handheld 50 2005 2006 2007 and later

119a 96a

72a

-shy-shy

-shy

603a 603a

603a a Standards apply throughout the engine useful life b Standards apply only when the engine is new Source Canada Gazette Part II Vol 137 No 24 2003-11-19

34 Europe

In 1998 the European Union introduced exhaust emission limits for small petrol engines through Directive 9768EC and in 2002 introduced amendments through Directive 200288EC The limits in the Directives align with the US regulations however they do not have averaging and banking provisions

Table 8 European Emissions Standards

Small Engine Class Type (HC+NOx in gkW-hr) 2004 2005 2006 2007 2008

SN1 (lt66cc) Non-handheld (eg lawn mowers)

161 161 161 161 161

SN2 (66 to lt 100cc) 161 161 161 161 161

SN3 (100 to lt 225cc) - - - 161 161

SN4 (225cc or more) - - 121 121 121

SH1 (lt20cc) Handheld (eg trimmers)

- - - 50 50

SH2 (20 to lt50cc) - - - 50 50

SH3 (50cc or more) - - - - 72

13

The European Union is currently considering including useful life criteria and averaging and banking provisions plus it is considering introducing a Directive to further reduce emissions from diesel engines The objective of the proposal is to tighten emissions standards for engines in general non-road applications in light of technological developments and it taking into account the parallel developments for similar legislation in the United States in order to harmonise the environmental standards and to facilitate trade

Charts comparing the USA Californian and European Emission Limits are shown below

14

35 Summary of Regulations for Non Handheld Equipment

KEY TO CHARTS

USEPA CARB EU

0

10

20

30

40

50

60

70

80

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

0 to 49cc

0

10

20

30

40

50

60

70

80

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

50 to 65cc

0

2

4

6

8

10

12

14

16

18

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

100 to 224cc

0

2

4

6

8

10

12

14

16

18

20

2000

2002

2004

2006

2008

Year Model

HC

+N

Ox g

kW

-hr

225cc and over (up to 19kW)

15

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

36 Summary of Regulations for Handheld Equipment

KEY TO CHARTS

USEPA CARB EU

20 to 49cc 0 to 19cc

250 250

200

150

HC

+N

Ox g

kW

-hr

100

200

HC

+N

Ox g

kW

-hr

150

100

50 50

0 0

Year Model Year Model

50 to 65cc 66 to 80cc

160

160

140

140

120

40 40

20 20

0 0

120

HC

+N

Ox g

kW

-hr

HC

+N

Ox g

kW

-hr

100100

8080

60 60

Year Model Year Model

16

Summary of Regulations for Handheld Equipment (continued)

KEY TO CHARTS

USEPA CARB EU

0

20

40

60

80

100

120

140

160

2000

2001

2002

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

81 to 224cc

0

20

40

60

80

100

120

140

160

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

225cc and over (up to 19kW)

17

4 Australian Market for Small Engines

41 Likely compliance with overseas emissions standards

As part of this assessment an environmental profile of equipment currently on the Australian market has been developed initially based on information from manufacturersrsquo brochures and web sites and industry magazines and then confirmed through follow-up with relevant industry contacts

Each item of equipment has been assessed on its compliance with USEPA CARB or European regulations In most cases it was not possible to match models available on the Australian market with CARB lists (CARB publishes exhaust emissions data on all appliances on its web site) This was mainly due to the inconsistency of model designations and uncertainty about ldquoengine familiesrdquo

Engine characteristics and retail price were difficult to obtain Some brochures also made claims of compliance with USEPA European or CARB requirements The detailed breakdown of current equipment on the Australian market is given in Appendix 1

The majority of small engines sold in Australia are imported and many come from countries that impose emission limits The extent of imports into Australia that do not comply with the country of origin standards is not known Industry estimates that 40 of garden products are sold through importers who are not linked to manufacturers of US EPA or European certified equipment and the source of some products sold here is difficult to establish Victa is the only company producing small engines in Australia Its iconic 2-stroke lawnmower currently cannot meet overseas emission limits

Outdoor Power Equipment Association (OPEA) assisted in identifying the Australian distributors of most brands of powered garden equipment In April 2006 a survey form was sent to a total of 43 distributors representing 97 brands of equipment The survey form sought information about the engine for all petrol-fuelled garden equipment with a power not more than 19kW

Figure 2 Extract from survey form

18

Initial response to the survey was poor Despite follow-up action and efforts from the industry association at the beginning of September 2006 26 distributors had responded to the survey information and only 13 distributors provided all data necessary for benchmarking purposes This resulted in emission compliance data for about half of the estimated products on the Australian market Attempts to match Australian models with the database maintained by the Californian Air Resources Board were also of limited success due to inconsistencies in model designations between Australia and the USA and the manner in which model information is coded in the CARB database

Table 9 Summary of distributor responses

Responses status Not OPEA OPEA ALL

Number of responses 9 8 (31) 17 (40)

Response - all data 4 9 13 (30)

Response - extra time sought 3 3 (7)

Response - no petrol products 4 1 5 (12)

Response - some data 5 5 (12)

Grand Total 17 26 43 percentages may not add to 100 due to rounding

Of the 97 brands initially identified

bull 16 brands are apparently no longer sold in Australia

bull No responses were received for 29 brands

bull Partial data were received for 12 brands

bull All data was available for 30 brands

Table 10 Summary of responses by brand

Count of brands

Analysis status Not OPEA OPEA All

Missing some data 12 12

No data received 9 (27) 20 (31) 29 (30)

No longer sold 13 3 16

Response - no models to list 3 7 10

Response received (electronic form) 5 11 16

Response received (paper form) 3 2 5

Response received (spreadsheet) 9 9

All 33 64 97

A 2004 report for the NSW DEC estimated that there were about 1200 eligible garden

19

products in the Australian market The current project has obtained data for a total of 870 products or 72 of the estimated population In addition the sampling method is likely to be biased towards products with good environmental performance In these circumstances the following analysis should be regarded as indicative only

Survey results

The following tables and figures show expected compliance with European CARB or USEPA requirements based on the limited information provided by industry

Table 11 Engine type and compliance with overseas standards Count of products Engine type

Best STD 2c 4c Unknown All 1997 - US EPA I 53 32 85 (10) 200288EU 17 17 (2) 2004 - US EPA II 1 3 4 (lt1) 2004 EURO I 8 8 (1) 2005 - US EPA II 10 29 5 44 (5) 2006 - US EPA II 107 141 2 250 (29) 2006 EURO I 6 6 (1) 2007 - US EPA II 1 1 (lt1) 2007 Euro II 2 2 (lt1) None 118 90 208 (24 Unspecified 24 60 161 245 (28) All 344 358 168 870

Unknown means the type of engine is unknown (but is most likely to be 2c) Unspecified means that the status of emissions compliance was unable to be identified None means the manufacturerdistributor has indicated that the equipment does not comply with any overseas emissions standard

Figure 3 Compliance with overseas standards - all surveyed products Note Unknown in chart includes unspecified and unknown from Table 11

20

Figure 4 Compliance with overseas standards by equipment type ldquoPhase 1 equivrdquo means the engine complies with US EPA phase 1 or 200288EU ldquoPhase 2 equivrdquo means the engine complies with US EPA Phase 2 Euro I or Euro 2 ldquoUnknown means that engine cycle (stroke) was not provided

Of the 41 categories of equipment in the survey 15 had at least 10 current products Results for these categories are set out below

Figure 5 Engine type for popular categories

21

Figure 6 Compliance with overseas standards for popular categories ldquoPhase 1 equiv means the engine complies with US EPA phase 1 or 200288EU Phase 2 equiv means the engine complies with US EPA Phase 2 Euro I or Euro 2 ldquoUnknown means that engine cycle (stroke) was not provided

42 Australian Sales of Outdoor Powered Equipment

The Australian Outdoor Power Equipment Association (OPEA) whose membership represents about 80 of the manufacturersdistributors and dealers in the industry commissions regular independent industry audits of garden equipment sales (OPEA personal communications) Sales data from OPEA is shown in Table 12

22

Table 12 Sales of outdoor garden equipment 2002 and 2005-06 2005-06 2 stroke (1000)

2002 2 stroke (1000)

2005-06 4 stroke (1000)

2002 4 stroke (1000)

2005-06 TOTAL (1000)

2002 TOTAL (1000)

Walk behind mowers 72 170 351 76 424 246

Brushcuttertrimmer 321 12 17 180 339 192

Chainsaws 152 0 0 90 152 90

Chipper shredders 0 60 46 0 46 60

Blowerblower vacuums 98 0 11 50 109 50

Ride on mowers 0 25 51 0 51 25

Generators 11 32 96 0 107 32

Hedge trimmers ampothers 40 192 0 28 40 220

694 491 476 424 1267 915

for total sales 593 463 407 537

for mowers 152 280 848 720

According to OPEA approximately 424000 walk behind lawnmowers and more than 792000 units of outdoor handheld equipment were sold in Australia in 2005-06 In addition there were sales of about 80000 replacement engines and 70000 pumps in 2005-06 most of which were four strokes These figures show that there has been considerable growth in the sales of most products with the exception of chipper shredders and the category lsquohedge trimmers and othersrsquo whose sales declined in 2005shy06 compared with those in 2002 About 17 of walk behind lawnmowers were two stroke and 83 four stroke which is an improvement in the uptake of cleaner engines when compared to 2002 when about 30 were two stroke The situation with handheld equipment is reverse with nearly 79 being two strokes compared to 47 in 2002 However many models of two stroke handheld equipment meet current US emission standards and care should be exercised in using engine type (two stroke or four stroke) as an indicator of emissions performance for this class of equipment

The OPEA 2005-06 sales estimates are shown in Figure 7 OPEA cautions that there is considerable uncertainty about the estimates for brushcutters and blowerblower vacuums as OPEArsquos figures only represent 50 and 60 respectively of sales of these products No estimates of future sales trends were identified during research for this project

23

Australian sales of 2 and 4 stroke outdoor equipment 2005-6

0 50 100 150 200 250 300 350 400

Walk behind mowers

Brushcuttertrimmer

Chainsaws

Chipper shredders

Blowerblower vacuums

Ride on mowers

Generators

Other

Annual sales (x 1000)

4s 2s

Figure 7 OPEA estimates of equipment sales in 2005-06 Note Blowervac is an industry term for equipment that combines blowing and vacuuming functions

Briggs and Stratton (Australia) who import engines from the USA supply the majority of the four stroke engines for handheld equipment sold in Australia and these comply with all the current USA and CARB regulations Imported handheld garden equipment is shipped fully assembled to a branch or distributor and is then sent to a retailer The retailer may or may not provide equipment servicing

OPEA members have expressed concern regarding the increasing sales of imported high polluting two stroke engines that allegedly do not meet any emission standards and come from countries that do not have emission standards One industry representative reported that some of the imported trimmers were being manufactured in China using outdated designs and tooling from two old bankrupt American companies and these are being sold here at about 30 of the price of traditional brands and very low cost generators from China now account for around 70 of total sales It is difficult to confirm this trend without undertaking a detailed examination of Australian import data however the significant increase in the sales of two stroke handheld equipment provides some support for this trend

On the other hand it is claimed by industry that the ride on mower market (predominately with compliant four stroke engines) has been stimulated by the Australian USA free trade agreement

24

5 Australian Users of Small Engines This section examines the market segments for garden equipment and customer purchasing behaviour

51 General Public

Purchasing behaviour

Research into consumer purchasing behaviour has found that consumers assess a product against a range of attributes for example price weight brand reputation servicing and parts availability warrantees and guarantees experience size promotions and discounts Studies have also revealed that up to 82 of Australians had bought products on the basis of social or environmental factors in the previous year (State Chamber of Commerce 2001) Related to this point the energy star rating ecolabel on whitegoods was viewed as a credible environmental claims system which is well regarded by the general consumer (Product Category Manager Mitre 10 personal communications)

As the purchase of small engine garden equipment by the general consumer is an infrequent purchase which carries a certain of amount of risk With small engines the risk can be functional risk (will not perform as expected) physical risk (for example safe features such automatic cut out on an electric lawn mower) or financial risk especially for the more expensive items The general consumer is likely to lessen the risk by seeking information and by evaluating the information on the available products over a period of time The consumer may also lessen the risk by

bull purchasing well known brands

bull buying the brand offering the best warrantees and guarantees

bull buying the most expensive brand and

bull buying a brand they have used before

Research indicates that the desired attributes of a product may not be well established at the start of a consumerrsquos search process but will often be refined as the consumer learns more about the product The consumer will also use a ranking and weighting process based on desired qualities and trade offs may be made

Reportedly purchases of engine operated garden equipment are based on price yard size fitness for purpose and other features such as weight and ease of starting (Product Category Manager Mitre 10 personal communications) Males are the predominant purchasers of garden equipment however because of changing demographics there has been an increase in the number of women purchasing these products

Less than 5 of lawnmowers purchased are push or electric mowers (Product Category Manager Mitre 10 and industry sources personal communications 2003)

25

Electric mowers are generally perceived as not being as effective as cords have limited range and rechargeable electric mowers require frequent recharging

There is a recent trend towards ride on mowers (all four strokes) probably because of changing demographics specifically older age groups moving to more rural environments with larger yards (OPEA personal communications)

A study (Wilkie 1994) investigated consumer appliance purchasing behaviour and found that the general consumer consulted a range of information sources before purchasing an appliance The appliance salesperson was found to be the most important information source for many consumers Other important information sources include newspaper advertisements friends and relatives catalogues consumer reports and brochureslabels Since Wilkiersquos study the internet will have become increasingly important as a research tool and in some instances as a way to purchase products As part of this study there is evidence of low priced products being sold into the Australian market via the internet only ndash a practice that is likely to increase in the future It was difficult to source any compliance or details on these products

At the retail chain level staff product training is generally voluntary undertaken out of store hours and as an inducement to attend training sessions suppliers usually provide incentives for staff Retail chain purchases are very price driven although some chains are reportedly interested in stocking goods that have credible environmental claims (Mitre 10 and other retail chain sources)

IBIS (2006a) reports that the domestic hardware sector which is dominated by Danks (Home Timber and Hardware Thrifty - Link Hardware and Plants Plus Garden Centre) and Bunnings is classified as a growth market and the sales of lawnmowers and other lawn and garden machinery and equipment represent about 14 of sales revenue

In summary it appears that a range of product attributes influences consumer purchases of lawnmowers and outdoor equipment Currently there is very little information about emissions in any of the information sources a consumer is likely to consult when purchasing these products Nevertheless surveys indicate that consumers are concerned about the environment and are open to including environmental considerations into their purchase decision Educating sales staff about the air emissions from lawnmowers and outdoor equipment together with ecolabels could therefore be important methods for influencing consumers towards the purchase of cleaner products

Equipment Usage

The USA Outdoor Power Equipment Institute CARB (cited in USEPA 1998) and the USEPA (USEPA 1998) have made estimates of annual usage rates and average life spans of outdoor equipment for the general consumer user and for the commercial user Table 13 gives USA usage and lifespan range for selected items of powered equipment

26

Table 13 USA Average Usage and Lifespan of Outdoor Garden Equipment For General Consumers and Commercial Users Equipment Annual usage (Hours) Lifespan (years)

General Consumer

Walk- behind mowers 20-25 6 -7

Rear engine ride on mowers 4 6 -7

Chainsaws 7 5-9

Leaf blowers 9-12 5-9

Trimmers 10 5-9

Commercial User

Walk- behind mowers 320 27

Rear engine ride on mowers 380 38

Chainsaws 405 1-13

Leaf blowers 170-293 18-28

Trimmers 170 - 275 15-28

Discussions with members of the Australian industry confirm that Australian hours of use are likely to be similar to the American estimates although this can vary depending on location For example in tropical areas lawns are mowed more often because they grow faster in this climate The American turnover of equipment is however probably higher than here as the Australian consumer tends to keep their equipment longer and so the useful life of a mower is more likely to be on average 10 ndash12 years

52 Garden and Ground Maintenance Services

According to a recent IBIS report (2006b) the revenue for this industry in 2005-06 was $383 million and the industry outlook is lsquobrightrsquo with a predicted annual average 5 growth over the next few years The Australian customer base for garden maintenance services including for lawn mowing is

Households 55 Business 25 Government 20

The sector is reportedly a growth industry due to

bull the aging population

bull the increasing numbers of households that are time poor income rich and

bull the growing trend for professional landscaping which requires a higher level of garden maintenance

27

The main customer base for these businesses includes middle to upper socioeconomic groups the aged and people who are physically disabled Growth is predicted particularly for the franchise industry with demand from the commercialindustrialgovernment sectors (IBIS 2003) A 1999 ABS survey reported that nearly one-third of older people purchased at least one domestic service per fortnight with gardening assistance being the most common This accords with an industry estimate that about 25 of householders pay someone to mow their lawn (Jim Penman Jimrsquos Mowing personal communication) The industry is sensitive to economic conditions and weather for example the drought has slowed growth over the last few years

The garden maintenance sector is dominated by small independent operators with two major franchisers Jimrsquos Mowing and VIP VIP nationally has 600 franchises and Jimrsquos Mowing about 400 Jimrsquos Mowing reportedly mows about 15000 lawns and has 53 of the market (IBIS 2006b) As franchised lawn mowing services represents about 14 of the lawn mowing services nationally it can be estimated that approximately 280000 lawns are mowed nationally by commercial operators

Jimrsquos Mowing and VIP provide training and advice to new franchisees on equipment including proper maintenance schedules Training generally occurs before franchisees purchase their equipment Most franchisees equipment would consist of two mowers a brushcutter an air blower and possibly a hedge trimmer or chain saw Operators prefer four stroke mowers and these are used for an average eight hours per week Brushcutters are generally two strokes as are other motors (IBIS 2006b and Jim Penman personal communication)

From the above it is estimated commercial operators operate mowers for up 34 million hours per year (or 8 of the total estimated mowing hours per year) and purchase approximately 66000 lawnmowers annually (25 of purchases) The sectorrsquos purchases of brushcutters is estimated to be approximately 8000 units per year or 37 of purchases Table 13 provides US commercial userrsquos annual average hours of use and average equipment life spans ndash it would be anticipated Australian rates would be similar

The main businesses contracting to provide ground maintenance services to the corporate and government sector (including universities) are Spotlessrsquos Open Space Management Transfield and Programmed Maintenance Services all of which are diversified publicly listed companies plus the Danish owned company ISS (previously Tempo Services) (IBIS 2003 and 2006b and company websites) The type of services they provide means it is likely they would have an array of equipment and a preference for the more powerful ride-on mowers and for Class V handheld equipment

53 Government Purchasing

The way purchasing decisions are made by government or other large organizations is generally very different to the approach taken by the general household consumer

bull many of the purchases are for large quantities of goods

28

bull there are well established policies and procedures in place to guide purchasing with the purchase criteria established early in the buying process and

bull those making the purchase are likely to be more knowledgeable about the product than the average consumer and they are usually not the eventual user of the goods

Value for money fitness for purpose ability to supply and over recent years environmental aspects are likely to be important factors in the purchasing decision for Government

Local State and Commonwealth Governments have responsibility for the upkeep of public assets many of which include public open space and other outdoors areas At the State and Federal level these include schools universities sporting facilities hospitals and defence facilities These services may be outsourced individual departments may undertake maintenance and purchase their own equipment or they may purchase equipment through a central purchasing facility With the central purchasing facility these items are generally purchased under contract While there is an increase in the inclusion of environmental considerations in the selection criteria for purchasing goods and services especially under contract these considerations mainly relate to waste management and recycling criteria and not air emissions

Local councils in some states for example NSW generally take responsibility for ground maintenance within their council areas or for some smaller councils the service may be contracted to a neighbouring council In other states such as Victoria there is a trend to outsource ground maintenance contracts to commercial providers

It is unknown what proportion of total sales that direct Government purchases represent however it likely to represent a relatively small share of several percent of the overall market

In summary

bull The general household consumer represents the major market segment for garden equipment accounting for up to 90 of product sales

bull Government is likely to be relatively small direct purchaser of garden equipment

bull Commercial garden services to households purchase approximately 25 of lawnmowers per year and 37 of brushcutters

bull Large ground maintenance companies are likely to prefer larger and more powerful equipment such as ride-on mowers

29

6 Result of Stakeholder Consultation

61 Regulations

The Small Engine Expert Panel ndash Outdoor Equipment considered in depth an approach to take to improve the emissions performance of outdoor garden equipment sold in Australia Discussions were particularly focused on the growing influence of cheap high emissions imported products together with the difficulties that the local manufacturer of lawn mowers is likely to face in complying with the relevant overseas standards As part of this process the industry representatives on the Panel held additional discussions and they consulted international industry experts at the manufacturing level in Europe the USA and Japan

OPEArsquos preference is for the adoption of regulations based on the USEPA standards with Phase 1 being adopted possibly from as early as 2007-08 The industry then proposes that Phase 2 be introduced in 2012 Phase 1 USA EPA standards were adopted in the USA in 1995 to be applied to equipment manufactured from 1997 and Phase 2 standards were introduced in 2002 through to 2007 and these included averaging banking and trading provisions A comparison between the USA Phase 1 and Phase2 standards is given in Table 14 The USEPA is discussing Phase 3 limits for the adoption in 20102011 which includes tighter exhaust emission limits for non-handheld equipment

The emissions limit of the two stroke lawn mower manufactured by the sole Australian manufacturer are well above USA Phase 1 limit for non-handheld equipment One avenue to address this issue which was supported by the Expert Panel ndash Outdoor Equipment would be to place lawn mowers in the US EPA Category 5 (engines gt50cc) This would result in emissions for two stroke lawnmowers being limited to 161 gkW-hour HC + NOx compared to the USA regulated limit of 161 gkW-hour HC + NOx Doing this would align the ramp-up timetable for mowers with that of other garden products

Table 14 Comparison between the USA Phase 1 and Phase 2 standards

Emission Limits GkW-hr

Phase 1 (1997 ndash2001) Phase 2 (2007) HC NOx HC+NOx CO HC+NOx CO

Non-handheld I-A lt66cc 161 610 I-B 66-lt100cc 161 610 I 100-225 cm3 161 519 161 610 II 225 cm3 134 519 121 610 Handheld III lt20 cm3 295 536 805 50 805 IV 20-50 cm3 241 536 805 50 805 V 50 cm3 161 536 603 72 603

Phase 2 limits were phased in between 2002 -2007 during which time they became tighter for simplicity only the 2007 are shown in this table (see Table 2 for more details)

30

In addition to limiting emissions the Expert Panel support the inclusion of the durability criteria which apply in the USA under Phase 2 standards and certification documentation from either the USA or Europe as adequate proof of conformity Equipment that has not been tested and certified to USA or European standards will be required to have the engines tested in a NATA certified laboratory

Some in the industry argued that regulations should include provisions for averaging for companies that wish to use it however they felt banking and trading provisions would not be necessary Industry representatives were not supportive of any Australian consumer labeling requirement instead OPEA members are willing to supply emissions data for inclusion in a web-based database that would allow purchasers to assess the environmental credentials of different makes and models

62 Discussion on recommended regulations

Timing of introduction

Some industry representatives argue that introduction of Phase 1 standards in 2007-08 will not give the industry an adequate transition period in which to develop competence in emissions certification establish new procedures and tooling in the dealers workshops train dealers and technicians on legal requirements distribute specific tooling and spare parts and reduce stocks of old (non certified) products without incurring an undue financial burden While others in the industry prefer progressing straight to phase 2 standards

If the OPEA preference for the adoption of the United States Phase 1 regulations which operated in the USA between 1995 and 2001 were introduced in Australia in 2007-08 they would be well behind the USA standards and worldrsquos best practice Furthermore the introduction of the United States Phase 2 - 2007 limits in Australia in 2012 would if the USEPA introduce Phase 3 in 2010-11 see emission limits for lawnmowers and other non handheld garden equipment in Australia still lagging United States standards and worldrsquos best practice

To introduce regulations in 2007-08 will require Government firstly to determine the most appropriate mechanism under which to enact the regulations draft the regulations prepare the regulatory impact assessment consult with the broader community and then finalise the regulations It is likely an Act of Parliament will be required at the Commonwealth level followed by complementary legislation at the State and Territory level It is possible for this to be achieved in less than a two year timeframe (as was the case for the Water Efficiency Labelling Scheme) However regulations that do not have a level of perceived urgency would take longer The level of importance and urgency to control emissions from small engines has yet to be debated and determined

31

Modified USEPA limits for lawnmowers

From the 183 lawn mowers identified through the market survey Victa is the main (possibly sole) provider of two stroke mowers with the other lawnmowers having cleaner four stroke engines

Victa is undertaking work to produce a cleaner product Victa estimates it would need a number of years to complete development production tooling and commercialisation of the cleaner engines In January 2007 it released a new two stroke carburettor lawnmower that has reduced engine emissions by more 30 but the combined HC and NOx emissions are still above USEPA Phase 1 limits Victa says this new engine is the outcome of four years of collaborative work by Victa and the University of Technology Sydney Victa is continuing with this research to further reduce emissions

A clause that allows exemptions to be granted as occurs in other countries could be included in the regulations however Victa argues that this would create uncertain trading conditions for the company for a period of time until an exemption were granted

Placing lawn mowers in the US EPA Category 5 (engines gt50cc) has the risk of opening the Australian market to more two stroke lawn mowers which has the greatest use of any outdoor powered equipment however it should see the continuance of the sole engine being manufactured in Australia In 1995 when it was introducing small engine emission limits the USEPA faced a similar issue with two stroke lawn mowers and used a similar approach by allowing two stroke lawn mowers to comply with the handheld standards It also specified that the number of two stroke lawnmower engines allowed to meet handheld standards would be subject to a declining annual production cap with the allowance provided by the production cap being phased out in 2003 There is also similar precedent for small engine emission limits that depend on engine type - European regulations for marine outboard motors set less stringent requirements for two stroke motors

Averaging Banking and Trading Provisions

The US EPA did not have averaging banking and trading provisions in Phase 1 and therefore all small outdoor engines were required to meet the Phase 1 limits It only introduced ABT provisions in the much more stringent Phase 2 as they would allow the most economic introduction of cleaner engines The industry claims the systems to use this provision are available and can be implemented in Australia by those who wish to use it at little cost to government

Industry claim that any supportive economic data related to averaging is sensitive and confidential It is there difficult without substantial justification by the industry to support the provision for averaging in conjunction with Phase 1 particularly given the elapsed time between the introduction of Phase 1 in the USA and their recommended introduction in Australia If there are some low volume equipment items that still cannot meet the USAEPA Phase 1 standards then these could be subjected to

32

exemptions if adequate justification can be provided (exemptions for small volumes were available under the USEPA regulations)

It was noted that for government to implement regulations a regulatory impact statement is required and this requires an assessment of the costs and benefits of the options considered with clear overall benefits shown for the preferred option Therefore if the option for manufacturers to use averaging were to be considered more information to support its inclusion would be required

Other options that could be considered to circumvent the inclusion of averaging include

i including clauses that give manufacturers the ability to apply for exemptions from the regulations for classes of equipment that have small sales volumes (these provisions are available in the USA)

ii limiting the regulation to popular types of equipment

iii using the end-of-model life provisions that have been used in the Australian Design Rules for cars In effect the end of model life provisions require new designs to comply from the implementation date but allow older models to remain on sale for a few more years This is an alternative to ABT because it facilitates earlier introduction of the regulation

iv Having a phase in period of say 2 years during which existing models can continue to be sold but new models coming on to the market must comply with the new standards At the end of the phase-in period all models must comply with the new standards This is an approach that is used when Australian Design Rules (ADRs) are introduced for motor vehicles

Consumer Information

Current Australian directions to reduce the environmental impact of consumer products favor tiered benchmarks using a lsquostarrsquo rating system (see Appendix 3 for examples such as the Mandatory Energy Efficiency Label and the Water Efficiency Labelling Scheme)

As products generally arrive in Australia assembled and packaged industry considers a mandatory requirement to label products with an Australian style star rating would impose a cost on distributors that would drive up the retail price of products Instead the OPEA members were willing to supply emissions data for inclusion in a web-based database that would allow purchasers to assess the environmental credentials of different makes and models Given the diverse nature of the industry it is unlikely a database would provide complete coverage of all products on the Australian market but inclusion in the database would indicate that the manufacturer has a commitment to environmental performance It was acknowledged in discussions that at least some Phase 2 compliant products would become available prior to 2012 and the web-based database would provide one method to promote those cleaner engines

33

In summary the Recommendations of the Expert Panel

1 Mandatory air pollutant emission standards to be introduced in Australia for all outdoor equipment (lt19kW) powered by spark-ignition engines The development of any regulation would need to be based on a formal assessment of the costs and benefits of nationally regulating 2 and 4 stroke lawn mowers and handheld power equipment which should be commenced immediately

2 Proposed standards to mirror US EPA regulations (compliance with equivalent EU regulations also acceptable)

3 Timing (subject to completion of assessment of costs and benefits)

(a) US EPA Phase 1 ndash Effective from 2007 2008

(b) US EPA Phase 2 ndash Fully implemented in 2012 (in step with 2007 USEPA limits) with phase-in period andor ABT over 2008-2012 to provide for early introduction of cleaner product

4 Walk-behind 2 stroke mowers to be included in US EPA Category 5 (gt50cc) product classifications Implementation timing to be as in Recommendation 3 above

5 All products also to be certified to relevant EPA durability categories

6 Subject to further review ABT (if included) may be phased out after 2012

34

7 The Way Forward

The optimum approach for garden equipment out engine emissions of options needs to be sustainable and cost effective This will need to be determined through a costs and benefits analysis (CBA) CBA assigns monetary values and typically assesses the impacts on the consumer on human health on the environment on industry and on government A detailed costs and benefits analysis is beyond the scope of this report however the following sections draws on available information to provide some indication of the possible costs and benefits that are associated with emissions from garden equipment engines

Air Quality Benefits

Environment Canada estimated the introduction of the regulations would result in a 44 percent reduction in combined HC+NOx emissions from small engines used in garden equipment and reduction in individual air pollutants over a 25 year period as shown in Table 15 The Canadian estimates incorporate the benefits that would accrue from the MOU signed with the industry in 2000 plus the benefits from the regulations introduced in 2003 In 2000 Canada imported around 13 million small spark-ignition engines and machines (ie a similar number to Australia) with 80 supplied by the USA

Table 15 Canadian Small Spark-Ignition Engine Emissions in Year 2025

Substance Base Case Emissions in 2025

Emissions in 2025 with Regulations

Percentage Reduction in 2025 (Regulations vs Base Case)

Criteria Air Contaminants (kilotonnes)

HC 772 410 469

NOx a 84 67 201

CO 1413 1403 07

Greenhouse Gas (kilotonnes)

CO2 2903 2645 89 Base case year 2000 (accommodating voluntary agreement) Source Canada Gazette Part II Vol 137 No 24 2003-11-19

Other Environmental Costs and Benefits

In addition to the human health benefits associated with reduced exposure to ozone there is a range of other public benefits including reduced damage to vegetation and therefore higher crop yields less damage to materials and structures particularly

35

some rubber products and improved visibility due to a reduction in smog haze Plus there are benefits associated with lower emissions of other air pollutants

To date there appears to have been little work undertaken in assigning a monetary value to these benefits as it is considered that they are likely to be small compared to human health impacts

Health Costs and Benefits

The Final Impact Assessment for the Ambient Air Quality National Environment Protection Measure (NEPC 1998) estimated that the health damage costs from exposure to ozone nationally to be in the range of $90 ndash $270 million (in 1998 dollars) This figure did not include mortality costs because of difficulty in assigning a figure to human life nor did it include costs associated with minor symptoms such as sore throat cough headache chest discomfort and eye irritation that can result from ozone exposure On the cost of ozone exposure the Impact Assessment states that lsquothe social well-being associated with potentially 6 and 20 million fewer irritating symptoms annually cannot be reliably quantified but at $1 a symptom it adds up to an appreciable amountrsquo

Since the Air NEPM Impact Assessment ozone levels in Australian urban areas have not fallen significantly but the population and medical costs have increased since then However using the above figures to make a rough estimate the contribution made by engines used in lawnmowers (ie not including other garden equipment) to the health damages cost from ozone exposure would be at a minimum $36 - $108 million not including the cost of mortality or minor symptoms As any action on these engines is likely to only remove high emission engines over a decade or more a CBA would be required to include an assessment of the proportional health benefits that would accrue from only removing the high emitters over time

Costs and Benefits to the Consumer

In 1995 the USEPA estimated that on average the cost to the engine manufacturer to install the necessary emission control technology to meet Phase 1 standards (which didnrsquot have ABT) would be approximately $US2 per engine used in nonhandheld equipment and $US350 per engine used in handheld equipment It also estimated that this would translate to sales-weighted average price increases of about $US7

The introduction of phase 2 regulations USEPA estimated would result in price increases of between $US20 and $US64 for handheld equipment depending on the equipment class (USEPA 2000) where handheld engines ranges in price from $60 to $1000 (USEPA 1995)

In addition to emission reductions the implementation of exhaust emission limits has the advantage of reducing fuel consumption and lowering operating costs to the consumer For example the USEPA estimated that for Phase 1 limits that applied between 1995 and 2001 on an average sales-weighted engine basis would decrease fuel consumption by 26 percent for non handheld equipment and a 13 percent decrease in fuel consumption for handheld equipment (USEPA 1995) Phase 2

36

(current limits) would result in a further decrease in fuel consumption of approximately 30 percent for handheld engines

When the USEPA considered the fuel savings offset and the retail price increase it estimated that the average sales-weighted lifetime increase in cost would be about $US650 per handheld engine while nonhandheld engines will realize a lifetime savings of about $US250 per engine This does not include the lifetime savings in maintenance costs which should further benefit the consumer (USEPA 1995)

Euromot (The European Association of Internal Combustion Manufacturers) claims that compliance with European minimum performance standards that do not have ABT provisions adds around 30 to the cost of some products that have had to be brought into compliance4 compared to products sold under the ABT system in the US

Costs and Benefits to Industry and Government

As there is only one local manufacturer among the 43 distributors of powered outdoor garden equipment sold in Australia and all others are importers the main costs to reduce the emissions contribution made by these engines will be associated with program administration and compliance particularly if regulations are introduced

The Productivity Commission an independent agency which is the Australian Governmentrsquos principal review and advisory body on microeconomic policy and regulation recently examined the cost effectiveness of measures to improve the energy efficiency in household appliances As part of its review lsquoThe Private Cost Effectiveness of Improving Energy Efficiencyrsquo it examined labelling programs (ie regulated tiered benchmarks) and minimum mandatory energy efficiency requirements (ie a regulated simple benchmark) While the household appliance market is considerably larger than the garden equipment market the Commissionrsquos final report contains some information that is useful for determining the approach that could be used to establish an emissions reduction scheme for garden equipment A summary of relevant sections of this report is provided in Appendix 3

The Commission identified both administration and compliance costs associated with labelling programs and minimum mandatory energy efficiency requirements as well the impacts these had on product suppliers

The Department of the Environment and Water Resources provided details to the Commission on the costs involved in administering both the labelling scheme and the minimum performance standards for energy programs The information provided showed that

bull the administration costs of the simple benchmark approach were substantially lower (less than one tenth) than for labelling and 84 per cent of administration costs were passed on to appliance purchasers with the remainder borne by governments

4 Presentation by Dr Holger Lochmann Rob Baker Axel Rauch Stihl 19 April 2006

37

bull the compliance costs for labelling are higher

bull minimum mandatory energy efficiency requirements can have a greater cost for suppliers than labelling since suppliers must adjust their model ranges to meet the MEPS levels by the given date These compliance costs are however influenced by the lsquolead inrsquo time between introduction and the implementation of the regulations

bull The increased cost to appliance purchasers of labelled appliances was about two and half times higher compared to appliances purchased under minimum mandatory energy efficiency requirements this being due to consumers voluntarily purchasing more efficient appliances

Overall the Commission considered that labels should be more actively considered as an alternative to minimum performance standards The Commissionrsquos support was based on the ability of labels to amongst other things

bull directly address ldquoa source of market failure mdash the asymmetry of information between buyers and sellers of energy-using productsrdquo

bull provide information to the consumer that is readily-accessible and easily-understood so they can help the consumer make better-informed choices

bull Have net social benefits and possibly have net benefits for consumers

bull provide a greater incentive for suppliers to sell environmentally better products

bull warn consumers through a disendorsement label that an appliance is very inefficient This approach can discourage but not prevent consumers from buying the poor performing product

71 Options to Reduce Emissions from Garden Equipment Engines

There is a range of options that could be considered for reducing emissions from engines used in outdoor garden equipment in Australia These include

1 Do nothing

2 Partnership Programs

3 Quasi regulation

4 Co-regulation

5 Regulations

In the following discussion about these options many Australian examples are mentioned Further details about these programs plus an overview are provided in Appendix 2

38

72 Option 1 ndash Do Nothing

Based on data supplied by OPEA the sales of high emitting two stroke carburettor engines as a percentage of engines used in outdoor equipment increased during the period 2002 to 2005-6 (see Table 12) from 463 to 593 and overall sales number increased by 38 during that period There is no indication that in the short to medium term that sales of equipment with two stroke carburetor engines will decrease in overall sales numbers or as a percentage of sales Therefore under the lsquodo nothingrsquo option emissions from outdoor garden equipment will continue at the same rate or perhaps based on sales figures of two stroke carburetor powered equipment at an even higher rate in the future

73 Option 2 ndash Industry - Government Partnership

In the discussion papers prepared for the NSW small engine project (2004) some examples of successful voluntary Government-Industry Partnership programs were provided The examples included were

bull the National Industry Reduction Agreement where the major newspaper and magazine publishers in Australia agreed to promote recovery and recycling of old newspapers and magazines

bull the NSW EPA-Oil Industry MOU on Summer Fuel the National Packaging Covenant (which has legislative backup) and

bull the EPA Victoriarsquos agreement with the Altona Chemical Complex

From the Australian programs reviewed it appears that the best indicators for successful partnership programs are

bull a relatively small number of firms within the industry

bull a commitment and involvement by all of the industry

bull clear program aims and objectives plus program targets and

bull a willingness by the industry to enter into a cooperative partnership with government

There are 43 identified distributors selling 97 brands of outdoor powered equipment in Australia Many of the major distributors are members of OPEA but there are many distributors who are not members It is therefore unlikely that the even the majority let alone all of the Australian distributors would commit to a industry-government partnership to reduce emissions

74 Option 3 - Quasi Regulation

Quasi regulations can take a range of forms the most usual being the establishment of a code of practice that industry endorses and implements A fundamental part of the code of practice would be emissions standards There are few examples of the use of codes of practice to limit emissions

39

Governmentrsquos role under this scenario is likely to be in assisting in the development of standards

The likelihood of this option being successful for similar reasons to the industry government partnership option is low

75 Option 4 -Co Regulation

Co-regulation is an agreement by industry and government to certain undertakings that support the uptake of cleaner products with a regulatory base It allows industry program flexibility to achieve certain negotiated targets Australian examples of coshyregulation include

bull The Green Vehicle Guide which operates through an industry government agreement where industry report test results to government in an agreed format within a certain timeframe Government manages the data and promotes the program This program is underpinned by Australian Design Rules for motor vehicles

bull The electrical appliance stand-by power program where there are agreed targets established that industry is required lsquovoluntarilyrsquo to meet failure to achieve the targets will result in regulation

bull The Packaging Covenant which is a program that allows industry the flexibility to design it own programs to reduce packaging waste and achieve certain target The Covenant is complemented by the NEPM on used packaging which specifies certain government responsibilities to support the program plus measures that will be introduced if targets are not met

Given the large number of distributors on the Australia market co-regulation for engines used in garden equipment using a similar form to the standndashby power program or the packaging program - an agreement by industry and government on a percentage reduction target for the sale of high emitting engines within a specified timeframe together with an agreement that regulation will be adopted if the target is not met ndash is also unlikely to be successful

76 Option 5 - Regulation

Regulation which requires a clear acknowledgement of a sufficient problem by Government places uniform mandatory compliance obligations on industry The costs associated with regulations are usually shared between government and industry with the development of regulations and program administration costs being borne by government with industry meeting compliance costs including emissions testing and if applicable labelling costs

It could argued that regulation should be introduced in the States or Territories where there are exceedances of the Air NEPM ozone standards However development of state based regulations for garden equipment engines emissions is unlikely as they would be incompatible with the 1992 Intergovernmental Agreement on the

40

Environment signed by the Commonwealth States and Territories and existing Commonwealth and State Government mutual recognition legislation The Intergovernmental Agreement on the Environment which underpins the development of National Environment Protection Measures obligates all jurisdictions to ensure equivalent protection from air pollution to all Australians

In addition enforcement of any state based legislation would be a key problem Under the Commonwealth Mutual Recognition Act 1992 and the Trans-Tasman Mutual Recognition Act 1997 goods that are imported into or produced in an Australian State or Territory or New Zealand that can be sold lawfully in that jurisdiction can be sold freely in a second jurisdiction even if the goods do not comply with the regulatory standards of the second jurisdiction This means non-regulated small engine products legally sold in one State could be legally sold in any other state regardless of whether emissions limits on small engines applied in that State

National regulation on the other hand would provide national consistency It would also provide the opportunity to adopt worldrsquos best practice standards and incorporate penalties for non-complying parties

Under the Australian Constitution the Commonwealth does not possess specific legislative powers in relation to the environment and heritage There are however a number of legislative powers that can support environment and heritage legislation Furthermore Commonwealth legislative powers can be used cumulatively For example the Commonwealth Parliament can make laws under section 51(20) of the Constitution with respect to ldquoforeign corporations and trading or financial corporations formed within the limits of the Commonwealthrdquo

Legislative mechanisms may also be created through the development of a National Environment Protection Measure (NEPM) that then becomes law within each jurisdiction A NEPM can accommodate flexibility of implementation where jurisdictions that have elevated ozone levels can tailor their NEPM program to their specific air quality needs An example of this flexible approach is the Diesel NEPM which has a suite of programs which can be implemented by jurisdictions

From the review of Australian regulations to reduce the environmental impacts of products and the overseas approaches to control emissions from small engines two regulatory approaches become apparent a simple benchmark or tiered benchmarks These are outlined below

Regulatory Option1 - A Simple Benchmark Approach

The most basic regulatory approach that could be taken would be to have a single emission standard (or as per the USA Europe and California a number of emission standards based on power and application) for combined HC + NOx emissions All equipment with new engines sold in Australia from the date the regulations are introduced This approach would

bull remove the all high emission engines from sale

41

bull be supported by an Australian Standard and

bull provide consumers with confidence that all products meet certain emissions standard

Regulatory Option 2 -Tiered Benchmarks

Current Australian directions to reduce the environmental impact of consumer products favour tiered benchmarks using a lsquostarrsquo rating system (see Appendix 2 for examples)

For engines used in garden equipment a tiered emissions labelling system could be based on the USEPA Phase 1 and Phase 2 standards use a system of lsquostarsrsquo to provide information to consumers about environmental performance but not limit consumer choice A tiered lsquostarrsquo system approach would

bull reward those products with more stars that meet the more stringent overseas standards

bull either operate with minimum emissions performance standards or disendorsement labels

bull be supported by a product label and possibly a web database

bull provide consumers emissions information and the option to purchase a lower emission engine

bull be supported by an Australian Standard and

bull be devised to meet worldrsquos best practice which is an overarching approach supported by Government

Table 16 summarises the main strengths and weaknesses of the above options

42

Table 16 Main Strengths and Weaknesses of Each Option

Strengths Weaknesses

Do Nothing Does not limit consumer choice Emissions contribution likely to grow No cost to government No barrier to new market entrants selling

high emitters Consumers have a wide choice of products Industry unchecked amp product dumping

likely No enforcement recourse on environmental grounds available

Partnerships Some sharing of responsibility government Slow if any reduction in high emitters

ndash industry

Potential for Government assist in Few if any companies likely to join and no advancing reductions in high emitters restrictions on non signatories Reduction targets set Below worldrsquos best practice

Quasi Regulation Similar strengths to partnership option Similar weaknesses to partnership option as

few if any companies likely to adopt code of practice

Co-Regulation Ongoing consultation between industry and Due to industry diversity targets unlikely to government recourse to regulation be met Targets set and can require new market Slow reduction in emissions entrants to achieve targets Can have implementation flexibility Emissions test standard adopted

Regulation Option 1- Simple Benchmark Worldrsquos best practice standards can be ovide incentives to manufacturers to promote low adapted and is mandatory emitters

Recourse to legal action available for non Does not provide consumers with emissions compliance information Significant quantifiable health benefits Cost of enforcement borne by taxpayers Requires compliance by all industry and High cost to government bans high emitters

Regulation Option 2 ndash Tiered Benchmarks Provides consumers with emissions information but does not limit choice Incentives for manufacturers to sell low emitters Potentially significant quantifiable health benefits Can be designed to overcome ABT issue

Significant administration and compliance costs to Government High cost to government and industry and will increase retail price of engines Does not ban high emitters

43

77 Preferred Approach

From the above discussion and from the review of garden equipment on available to the Australian consumer there are many companies selling powered garden equipment on the Australian market and the market is very competitive Furthermore from the Expert Panel discussions and stakeholder consultation it is apparent that it is highly unlikely that all the companies in the garden equipment industry would engage in or commit to a voluntary program to reduce their productsrsquo exhaust emissions It is therefore clear that the only feasible path to reduce emissions from these small engines is through regulation

While regulations of emissions from small engines used in garden equipment in Australia are likely to be based on overseas regulations they need to strike a balance between improved environmental outcome harmonisation with international standards and the characteristics of the local industry With regulation optimum emissions reductions are achievable especially by combining minimum emissions standards with tiered product labelling Whether this approach is justifiable on economic grounds that is the benefits outweigh the costs can only be determined through a detailed impact assessment Based on these findings it is recommended that a formal assessment of the costs and benefits of nationally regulating 2 and 4 stroke lawn mowers and handheld power equipment should now be commenced

44

References Air Resources Board California Environmental Protection Agency Californian Exhaust Emission Standards and Test Procedures for 2005 and Later Small Off-road Engines July 26 2004

Artcraft 2003 A Major Research-Based Review and Scoping of Future Directions for Appliance Efficiency Labels in Australia and NZ prepared for the Australian Greenhouse Office viewed at wwwenergyratinggovaulibraryindexhtml

Australian Bureau of Statistics 1999 Older People Australia A Social Report Report Number 41090 December 1999

Australian Greenhouse Office 2002 Achievements 2002 National Appliance equipment energy efficiency program Commonwealth of Australia

Australian Greenhouse Office 2002 Achievements 2002 National Appliance equipment energy efficiency program Commonwealth of Australia

AustralianNew Zealand StandardtradeASNZS 64002005 Water efficient productsmdashRating and labeling Federal Register of Legislative Instruments F2005L01571

Bei L T and Widdows R1999 Product knowledge and product involvement as moderators of the effects of information on purchase decisions a case study using the perfect information frontier approach Journal of Consumer Affairs 33(1) 165-186

Buy Recycled Busines Alliance Briefing Paper Environmental Claims And Labelling Abstract lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10-2003

California Code of Regulations 1998 Final Regulation Order Article 1 and Article 3 Chapter 9 Division 3 Title 13 Attachment 1 26 March 1998 wwwarbcagovregactsoreregs_finpdf

Canada Gazette Part II Vol 137 No 24 2003-11-19

Canadian Gazette 29 March 2003 Vol 137 No 13 Part 1 pp 935- 955

Cap Gemini Ernst amp Young (2001) Cars Online 2001 Global consumer survey httpa593gakamainet75931951a8b278a28319eawwwcgeycomhightechautomediaC ars_online2pdf

Clothes Washers Australiarsquos Standby Power Strategy 2002 ndash 2012 Standby Product Profile 200308 October 2003 wwwenergyratinggovau

Craig ndash Lees M Joy Sally Browne B 1995 Consumer Behaviour John Wiley amp Sons Queensland 1995

Department of Environment and Conservation NSW 2004 Measures to Encourage the Supply and Uptake of Cleaner Lawnmowers and Outdoor Handheld Equipment

45

Department of Environment and Conservation 2003 Who cares about the environment in 2003 A survey of NSW peoplersquos environmental knowledge attitudes and behaviours DEC Social Research Series

Department of Environment and Conservation Action for Air update 2006

Department of Environment and Conservation The Buy Recycled Guide Online Directory viewed at wwwresourcenswgovauindex-RNSWhtm

EcoRecycle 2004 Paint Take-Back Takes Off in Bayswater Media release 24 March 2004 viewed at wwwecorecyclevicgovau May 2004

Enviromower viewed at wwwenviromowercomau June 2004

Environment Canada 2000 Future Canadian Emission Standards for Vehicles and Engines and Standards for Reformulation of Petroleum Based Fuels Discussion Paper in Advance Notice of Intent by the Federal Minister of the Environment April 2000 wwwecgccaenergfuelsreportsfuture_fuelsfuture_fuels1_ehtm

Environment Canada 2004 Environment Minister Urges Canadians to Reduce Greenhouse Gas Emissions and Mow Down Pollution With Unique Incentive Program Media Release April 23 2004 viewed at wwwecgccamediaroomnewsrelease May 2004

Environment Protection and Heritage Council National Environment Protection (Ambient Air Quality) Measure Report on the Preliminary Work for the Review of the Ozone Standard October 2005

Environment Protection Authority 2006 Victoriarsquos Air Quality ndash 2005 Publication 1044 June 2006 wwwepavicgovau

Environmental Choice NZ 2001 Public Good and Environmental Labelling An Internal Background Paper

European Commission Directive 200344EC amending the recreational craft directive and comments to the directive combined 211005

George Wilkenfeld and Associates Pty Ltd with Artcraft Research and Energy Efficient Strategies Tomorrow Today 2003 Final Report A Mandatory Water Efficiency Labelling Scheme for Australia Prepared for Environment Australia June 2003

George Wilkenfeld and Associates 2003 A National Strategy for Consumer Product Resource Labelling in Australia prepared for the Australian Greenhouse Office December 2003 viewed at wwwenergyratinggovaulibraryindexhtml

Green Vehicle Guide wwwgreenvehicleguidegovau

Harrington L and Holt S 2002 Matching Worldrsquos Best Regulated Efficiency Standards ndash Australiarsquos success in adopting new refrigerator MEPS wwwenergyratinggovaulibrarypubsaceee-2002apdf

46

Harris J and Cole A 2003 The role for government in ecolabelling ndash on the scenes or behind the scenes lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10-2003

Holt S and Harrington L2003 Lessons learnt from Australiarsquos standards and labeling program Paper presented at ECEEE Summer Study - 2-6 June 2003 wwwenergyratinggovaulibraryindexhtml

IBIS 2006a Domestic Hardware Retailing 09-Jun-2006 Industry Code G523b

IBIS 2006b Gardening Services 18-Jan-2006 Industry Code Q9525

IBIS 2003 Gardening Services in Australia 23 December 2003 Industry Code Q9525

Lawrence K Zeise K amp Morgan P 2005 Management Options for Non-Road Engine Emissions in Urban Areas Consultancy report for Department for Environment amp Heritage Canberra

Motor Vehicle Environment Committee (MVEC) in consultation with the Department of Transport and Regional Services 2002 Proposal for an Australian ldquoGreen Vehiclesrdquo Guide viewed at httpwwwdotarsgovaumvegreen_vehicles_guidedoc May 2004

National Appliance and Equipment Energy Efficiency Committee The Energy Label at wwwenergyratinggovau (3504)

National Environment Protection Council 2005 National Environment Protection (Ambient Air Quality) Measure Report on the Preliminary Work for the Review of the Ozone Standard October 2005

National Environment Protection Council 1998 Final Impact Assessment for Ambient Air Quality National Environment Protection Measure June 1998

National Environment Protection Council 1999 Used Packaging Materials Impact Statement for the Draft NEPM Used Packaging Material January 1999 viewed at wwwephcgovau

National Environment Protection Council 2004 National Environment Protection (Air Toxics) Measure April 2004 viewed at wwwephcgovau

New South Wales Government 2002 Protection of the Environment Operations (Clean Air) Regulation 2002

New South Wales Government 1999 NSW Government Procurement Policy Statement White Paper 1999

Nordic Council 2002 Ecolabelling of marine Engines Criteria Document 8 December 1995 ndash 6 December 2005 version 35 December 2002

47

Office of Public Sector Information Statutory Instrument 2004 No 2034 The Non-Road Mobile Machinery (Emission of Gaseous and Particulate Pollutants) (Amendment) Regulations 2004 wwwopsigovuksisi200420042034htm

Outdoor Power Equipment Institute 2001 Profile of the Outdoor Power Equipment Industry wwwopeiorg

Productivity Commission 2004 The Private Cost Effectiveness of Improving Energy Efficiency Final report October 2005 wwwpcgovauinquiryenergy

Publishers National Environment Bureau Media Release lsquoAustralia leads the world in newspaper recyclingrsquo 6 June 2006 wwwpnebcomau

Real J Jones A 2005 The Green Vehicle Guide Clean Air Soceity of Australia and New Zealand Conference 2005 Hobart

Salmon G Voluntary Sustainability Standards and Labels (VSSLs) The Case for Fostering Them OECD Round Table On Sustainable Development

Schkade D A and Kelinmutz D N 1994 Information displays and choice processes differential effects of organization form and sequence Organizational Behavior and Human Decision Processes 57(3) 319-337

Stephens A 2003 Eco Buy (Local Government Buy Recycled Alliance Victoria) Abstract lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10shy2003

Teisl M F Roe B and Hicks RL 2002 Can eco-labels fine tune a market Evidence from dolphin-safe labeling Journal of Environmental Economics and Management 43339-359

Teisl M F Roe B and Levy A S Ecolabelling What does consumer science tell us about which strategies work pp141-150

The ISO 14000 family of standards guides and technical reports

The Parliament of the Commonwealth of Australia 2004 House of Representatives Water Efficiency Labelling and Standards Bill 2004 Explanatory Memorandum wwwcomlawgovauComLawLegislationBills1nsf viewed February 2006

Thogerson J 2000 Promoting green consumer behaviour with eco-labels Workshop on Education Information and Voluntary Measures in Environmental Protection National Academy of Sciences ndashNational Research Council Washington DC November 29-30

United States Environmental Protection Agency Federal Register Vol 60 No 127 3 July 1995 Control of Air Pollution Emission Standards for New Nonroad Spark-ignition Engines At or Below 19 Kilowatts wwwepagovEPA-AIR1995JulyDay-03prshy805txthtml

48

United States Environmental Protection Agency Federal Register Vol 69 No 7 12 January 2004 Rules and Regulations 40 CFR Part 90 Amendments to the Phase 2 Requirements for Spark-Ignition Nonroad Engines at or Below 19 Kilowatts Direct Final Rule and Proposed Rule wwwepagovfedrgstrEPA-AIR2004JanuaryDay-12a458pdf

United States Environmental Protection Agency Office of Pollution Prevention and Toxics Pollution Prevention Division 1998 Ecolabelling Environmental Labelling - A Comprehensive Review of Issues Policies and Practices Worldwide

United States Environmental Protection Agency Office of Transportation and Air Quality March 2000 Regulatory Announcement Final Phase 2 Standards for Spark-Ignition Handheld Engines

United States Environmental Protection Agency 1998 Proposed Phase 2 Emission Standards for Small SI Engines 27 January 1998

United States Environmental Protection Agency 2000 Regulatory announcement Final Phase 2 Standards for Small Spark-Ignition Handheld Engines March 2000 EPA420-F-00shy007

United States Federal Register Vol 69 No 7 Monday January 12 2004 Rules and Regulations Environmental Protection Agency 40 CFR Part 90 Amendments to the Phase 2 Requirements for Spark-Ignition Nonroad Engines at or Below 19 Kilowatts Direct Final Rule and Proposed Rule United States Federal Register Vol 64 No 60 30 March 1999 40 CFR Part 90 Phase 2 Emission Standards for New Nonroad Spark-Ignition Nonhandheld Engines At or Below 19 Kilowatts Final Rule pp15214-15216

United States Federal Register Vol 65 No 80 25 April 2000 40 CFR Parts 90 and 91 Phase 2 Emission Standards for New Nonroad Spark-Ignition Handheld Engines at or Below 19 Kilowatts and Minor Amendments to Emission Requirements Applicable to Small Spark-Ignition Engines and Marine Spark-Ignition Engines Final Rule pp24282-24284

United States Environmental Protection Agency Control of Air Pollution Emission for New Nonroad Spark-ignition Engines At or Below 19 Kilowatts Final Rule 40 CFR Parts 9 and 90 1995 wwwepagovEPA-AIR1995JulyDay-03pr-805txthtml

United States Environmental Protection Agency Office of Pollution Prevention and Toxics Pollution Prevention Division 1998 Ecolabelling Environmental Labeling- A Comprehensive Review of Issues Policies and Practices Worldwide

Victorian Government Greenhouse Strategy Community Action Fund - Mow Down Lawn Mower Rebate Exchange Program wwwgreenhousevicgovaucommunitygrantscafsuccessfulprojectshtm

Water Efficiency Labelling and Standards Act 2005 No 4 wwwcomlawgovauComLawLegislation

49

Water Efficiency Labelling and Standards Determination 2005 wwwcomlawgovauComLawLegislationLegislativeInstrument1nsf

Water Efficiency Labelling and Standards Regulations 2005 wwwcomlawgovauComLawLegislationLegislativeInstrument1nsf

Wilkie W 1994 Consumer Behaviour John Wiley and Sons NY as cited in Craig ndash Lees M Joy Sally Browne B 1995 Consumer Behaviour John Wiley amp Sons Queensland 1995

wwwenergyratinggovau

wwwgreenvehicleguidegovau

wwwwaterratinggovau

50

Appendix 1 Detailed Breakdown of Powered Garden Equipment on the Australian Market

The following table gives a profile of the current equipment on the Australian market It is based mostly on distributor responses to a survey and might not be representative of the total market

Low sales indicates that no sales data was available but volumes are likely to be small compared with popular equipment Phase 1 is US EPA Phase 1 or EU Directive 200288EU Phase 2 is US EPA Phase 2 or Euro standards

Type Ranges Stroke Aerator 5 makes 6 models Sales Low

Engine power 26 to 172kW Engine displ 143-674 ml

2c -4c 5 Unspecified 1 Phase 1 - Phase 2 4

Auger 3 makes 5 models Sales Low

Engine power 12 to 16kW Engine displ 31-ml

2c 5 4c -Unspecified -Phase 1 1 Phase 2 1

Backhoe 0 makes 0 model Sales Low

(2 models in 2003) -

Blower 13 makes 49 models Sales 109K

Engine power 07 to 31kW Engine displ 24-80ml

2c 34 4c 2 Unspecified 13 Phase 1 10 Phase 2 17

Blower-wheeler 3 makes 6 models

Engine power 07 to97kW Engine displ 24-305ml

2c 1 4c 4 Unspecified 1 Phase 1 3 Phase 2 -

Blowervac 6 makes 9 models Sales

Engine power 07 to 11kW Engine displ 24-34ml

2c 6 4c -Unspecified 3 Phase 1- Phase 2 3

Brush cutter 12 makes 95 models Sales 339K

Engine power 06 to 23kW Engine displ 21-54ml

2c 66 4c 5 Unspecified 24 Phase 1 15 Phase 2 34

Chainsaw 9 makes 106 models Sales 152K

Engine power 1 to 58kW Engine displ 26-122ml

2c 74 4c -Unspecified 32 Phase 1 18 Phase 2 27

Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

51

Type Ranges Stroke Clearing saw Engine power 14 to 27kW 2c 6 3 makes Engine displ 36-57ml 4c 0 9 models Unspecified 3 Sales low Phase 1 4 Phase 2 -Cultivator Engine power 07 to 52kW 2c 2 4 makes Engine displ 25-190ml 4c 5 7 models Unspecified -Sales low Phase 1 - Phase 2 5 De-thatcher Engine power 1kW 2c 1 1 makes Engine displ 27ml 4c -1 models Unspecified -Sales low Phase 1 - Phase 2 1 Drill Engine power 1kW 2c 3 3 makes Engine displ 27ml 4c -4 models Unspecified 1 Sales low Phase 1 - Phase 2 1 Edger Engine power 1 to 4kW 2c 12 10 makes Engine displ 24-190ml 4c 11 36 models Unspecified 1 Sales Phase 1 3 Phase 2 22 Garden tractor Engine power 12 to 157kW 2c -2 makes Engine displ 465 to 675ml 4c 5 12 models Unspecified 9 Sales low Phase 1 - Phase 2 3 Grass trimmer Engine power- 2c 3 1 make Engine displ 31ml 4c -3 model Unspecified -Sales Phase 1 - Phase 2 3 Hedge trimmer Engine power 06 to 1kW 2c 28 10 makes Engine displ 21-31ml 4c 1 42 models Unspecified 13 Sales 40K Phase 1 4 Phase 2 35 Lawnmower Engine power 26 to 66kW 2c 22 19 makes Engine displ 100-270ml 4c 151 183 models Price $449-$3609 Unspecified 10 Sales 424K Phase 1 95 Phase 2 48 Line trimmer Engine power 07 to 45kW 2c 25 8 makes Engine displ 24-195ml 4c 2 29 models Price $136-$299 Unspecified 2 Sales Phase 1 2 Phase 2 6 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

52

Type Ranges Stroke Log splitter Engine power 26 to 45kW 2c -1 makes Engine displ 100-195ml 4c 2 2 models Unspecified -Sales low Phase 1 - Phase 2 1 Multicutter Engine power 08 to 14kW 2c 17 5 makes Engine displ 23-36ml 4c 1 19 model Unspecified 1 Sales Phase 1 2 Phase 2 13 Olive nut shaker Engine power - 2c -1 make Engine displ - 4c -1 model Unspecified 1

Phase 1 - Phase 2 -Pole saw Engine power 08 to 14kW 2c 6 4 makes Engine displ 23-36ml 4c -10 models Unspecified 4 Sales low Phase 1 1 Phase 2 3 Power carrier Engine power 37 to 231kW 2c -2 makes Engine displ 160 to 953ml 4c 11 11 models Unspecified -Sales low Phase 1 - Phase 2 10 Power cutter Engine power 32 to 45kW 2c 5 2 makes Engine displ 64-99ml 4c -8 models Unspecified 3 Sales low Phase 1 1 Phase 2 3 Pruner (3 models in 2003) 2c -0 make 4c -0 models Unspecified -Sales low Ride-on-mower Engine power 26 to 231kW 2c -12 makes Engine displ 100 to 725ml 4c 93 124 models Unspecified81 Sales 51K Ph1 1 Ph2106 Rotary hoe (4 models in 2003) 2c -0 makes 4c -0 models Unspecified -Sales low Shredder Engine power 3 to 96kW 2c 1 6 makes Engine displ 126-389ml 4c 16 20 models Unspecified 3 Sales 46K Phase 1 - Phase 2 4 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

53

Type Ranges Stroke Stump grinder Engine power 96kW 2c -1 make Engine displ 389ml 4c 1 1 model Unspecified -Sales low Phase 1 - Phase 2 1 Tiller Engine power 08 to 59kW 2c -3 makes Engine displ 25-243ml 4c 8 9 models Unspecified 1 Sales low Phase 1 - Phase 2 7 Trencher Engine power37kW 2c -1 makes Engine displ 183ml 4c -1 models Unspecified 1 Sales low Phase 1 - Phase 2 1 Trimmer Engine power - 2c 10 2 makes Engine displ - 4c -21 models Price - Unspecified 11 Sales Phase 1 4 Phase 2 -Turfcutter Engine power 37kW 2c -1 makes Engine displ - 4c 1 1 models Unspecified -Sales low Phase 1 - Phase 2 -Vac Engine power 22 to 172kW 2c 1 5 makes Engine displ 158 to 674ml 4c 13 15 models Unspecified 1 Sales Ph11 Ph24 Vac chipper Engine power 34 to 45kW 2c -2 makes Engine displ 158-195ml 4c 3 3 models Unspecified -Sales low Phase 1 - Phase 2 1 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

54

Appendix 2 Examples of Current Australian Benchmarking Programs

The following describes in varying degrees of detail a number of current Australian benchmarking schemes classified by program type simple bench mark approaches tiered benchmarks and government industry partnerships This appendix concludes with a summary table of these programs with an assessment of their effectiveness

1 Introduction

Simple benchmark schemes (described below) such as the woodheater standards set a single point hurdle rate whereas the green vehicle guide use tiered benchmarks The new water efficiency labelling scheme and minimum energy efficiency performance standards uses both a simple benchmark through minimum performance requirement plus tiered benchmarks incorporated into labels as lsquostarsrsquo Other approaches such as the stand-by power program and the Victorian Altona Complex VOC reduction target set goals for achievement within a specified time period Other approaches taken to reduce environmental impacts include the National Packaging Covenant which uses a program based on individual companies developing tailored approaches to suit their circumstances and is supported by enforcement capability through the National Environment Protection (Used Packaging Materials) Measure (the NEPM)

2 Simple Benchmarks

21 Minimum Energy Performance Standards (MEPS)

Purpose

MEPS prescribe a minimum allowed energy performance for specific appliances Appliances that are less efficient than the relevant standard are excluded from the market

Background and Strategy

In October 1999 as part of the National Greenhouse Strategy (1998) nationally consistent MEPS and labelling schemes were adopted across Australia

Independent NATA accredited laboratories undertake product compliance checks to see whether products perform in compliance with MEPS requirements For example

bull In 2003 the government conducted check tests on eight appliance models all of which were found not to meet the claims made on the energy performance labels Two products were deregistered one was found to have not been registered and action was pending on the remaining five products (AGO 2003b)

55

bull Other regulatory actions undertaken in 2003 included fines of $3000 and $8000 against two Western Australian retailers who were found to have sold appliances without energy performance labels Queensland and Victorian retailers received infringement notices and fines totalling $10 000 (AGO 2003b)

Summary RegulNated minimum performance standards based on an Australian Standard

22 Energy Star

Purpose

An endorsement label that indicates an electronic product has achieved a specified standard when it is not performing its core function (ie on stand by)

Background and Strategy

Energy Star is a voluntary endorsement labelling program developed by the US Environmental Protection Agency (US EPA) It has been operating in the USA since 1992 and has been adopted by a number of countries including Australia Energy Star sets voluntary standards for reducing the electricity consumption of electronic equipment when it is not performing its core function

The Government stand ndash by program which is outlined below complements the energy star labelling program

Summary Voluntary endorsement label

23 Woodheater Standards

Purpose

To reduce particle emissions through Australian Standard compliant woodheaters

Background and Strategy

Since 1992 Australian StandardNew Zealand Standards have been introduced to improve the performance of wood heaters

The first standard for wood heater emissions AS4013 (1992) was published in 1992 and was revised and published as a joint AustralianNew Zealand Standard in 1999 ASNZS4013 (1999) Domestic solid fuel burning appliances - Method for determination of flue gas emission This Standard provides a test method to measure particles emitted by residential solid-fuel burning heating appliances

56

The 1992 Standard included an upper limit for acceptable particle emissions of 55 grams of particles per kilogram (oven-dry weight) of fuel burnt This emission factor was reduced to 4 gkg in the 1999 revision of the Standard The Standard applies to solid-fuel burning space-heating appliances (including those fitted with water heating devices) with a heat output of 25KW or less It does not apply to masonry fireplaces cooking stoves central heating appliances or water-heating-only appliances

AS 4013 (1999) is complemented by ASNZS4014 (1999) Domestic solid fuel burning appliances - Test Fuels and ASNZS4012 (1999) Domestic solid fuel burning appliances - Method for determination of power output and efficiency

The woodheater industry was instrumental in initiating the development of standards and it lobbied states and territories to enact legislation to mandating that woodheaters be required to meet the standards As the health affects of particle pollution have become more apparent and as some jurisdictions are having difficulty in meeting national particle standards Government has become more proactive in controlling woodheaters and more supportive of tighter standards

All states and territories with the exception of South Australia have regulations that restrict emissions from new woodheaters although Victoria for example only introduced its regulations in 2004 compared to Tasmania who introduced regulations in 1993 These regulations require that new woodheaters comply with the Australian Standard ASNZS 4013 The State regulations however are not uniform

Many woodheaters that are currently certified for sale do not comply with the revised standard as verified in a National Woodheater Audit Program undertaken in 2004 Seven of the 12 wood heaters tested failed to meet the ASNZS 4013 particle emission limit In addition 55 of heaters were found to have deviations from the original designs and 72 had labelling faults that could adversely affect emissions performance

Testing and certification are administered by the industry association

Summary State and regulations requiring compliance with Australian Standards Certification administered by industry association

24 Standby Power

Purpose

To reduce lsquoexcessiversquo energy consumed in electrical appliance standby mode sold in Australia through in the first instance voluntary targets Appliances covered by the program range from information technology equipment such as PCs and photocopiers entertainment equipment such as TVs DVDs and sound systems major appliances such as water heaters dishwashers and refrigerators and small appliances such as smoke detectors and bread makers

57

Background and Strategy

In 2000 standby power was estimated to constitute 116 per cent of Australiarsquos residential energy use costing households over $500 million and leading to the emission of over 5 million tonnes of carbon dioxide equivalent (AGO 2002c) Holt and Harrington (2004) estimated that standby power consumption in Australia could be reduced by 56 per cent by 2020 (Productivity Commission 2005)

In August 2000 all Australian jurisdictions agreed to pursue efficiencies in standby power consumption of energy-consuming products through support for the International Energy Agencys One -Watt program and endorse its incorporation into theprogram of work

Australia reportedly has taken the lead on implementing the One- Watt program even though many of the products sold in Australia are imported

During 2002 government agencies consulted with stakeholders about ideas to reduce standby The standby strategy which proposed a list of targeted potential product types was presented to the Ministerial Council on Energy

In September 2003 an interim test method for the measurement of standby power ASNZS 62301-2003 (int) based on an internationally recognised standard was published Also during this period work commenced on developing draft product profiles for high priority targeted products

Once product profiles are completed interim voluntary date-specific targets are made The product sales are then monitored to determine progress towards the interim target If it is then determined that inadequate progress is being achieved by a significant number of suppliers then government will regulate

For example the interim 2007 target for clothes washers is as follows

Product Off mode power End of program mode

lt 1W lt 4 W

The National Standby Strategy Target to be achieved by 2012 for clothes washers is as follows

Off mode power End of program mode lt 03 W lt 1 W

In support of the clothes washer program Government will

bull consider creating a Government Purchasing Policy to buy low standby clothes washers where available and fit for purpose

bull collect data on all modes for new clothes washers and analyse trends

bull highlight the range of performances by publishing performance data on clothes washers on a website or by other means

58

bull progressively include standby energy consumption into the Comparative Energy Consumption for labelled products such as clothes washers and clothes dryers

bull work with the Standards Committees to finalise the details of modes and test methods for the relevant standards

bull determine in 2008 if progress is inadequate and if regulation is required

Summary Industry targets possible future regulation

3 Tiered Benchmarks

31 Mandatory Energy Efficiency Label ndash the Energy Star Programs

Purpose

To enable consumers to easily compare the energy performance of electrical appliances used by households and firms through a labelling scheme

Background and Strategy

Several Australian states commenced mandatory energy efficiency labelling for major appliances in the mid-1980s In 1992 it became mandatory across Australia for initially refrigerators and later freezers clothes washers clothes dryers dishwashers and air-conditioners (single phase only) to carry the label when they are offered for sale This labelling program is regarded as one of the most successful in the world (Wilkenfeld and Assoc 2003) It is administered through the Australian Greenhouse Office

The energy rating label for dishwashers

(ldquoa joint government and industry programrdquo) and a website address (wwwenergyratinggovau) and has two main features

bull the star rating which gives a quick comparative assessment of the models energy efficiency and

bull the comparative energy consumption (usually kilowatt hoursyear) which provides an estimate of the annual energy consumption of the appliance based on the tested energy consumption and information about the typical use of the appliance in the home These values are measured under Australian Standards which define test procedures for measuring energy consumption and minimum energy performance criteria Appliances must meet these criteria before they can be granted an Energy Rating Label

The Energy Rating Label includes an endorsement

59

Awards Brand ModelInstallat

ionType

Phase Available

10 Yr Energy

Cost StarRating

Output(kW)

TOSHIBA

Digital Inverter Series Air

Conditioner RAV-SM1102BT-

ERAV-SP1102AT-E (

RAV-SM1102BT-ERAV-

SP1102AT-E)

SingleSplit

SystemDucted

Single $1500 1000

CHUNLAN

KFR-32GWVWa (

NO)

SingleSplit

SystemDucted

Single $645 323

Since its introduction the star rating label seems to have established a high level of recognition with consumers Consumer research (Artcraft 2003) indicates that the different information on the label appeals to different consumer segments interested in purchasing an appliance

When a manufacturer gains approval to use the label they pay for and produce the label in accordance with specifications on size colours fonts layout and design A similar colour scheme and design to the energy consumption label is also used for the compulsory fuel consumption label on new passenger and light commercial vehicles

The labelling scheme is underpinned by regulation whereby regulated Minimum Energy Performance Standards (MEPS) provide the environmental benchmarks that the appliances are required to meet Appliances that do not meet the minimum energy performance standards can be withdrawn from the Australian market

When the energy rating program was reviewed in 2000 technology had advanced to the point where a large percentage of appliances had achieved the maximum number of stars so the rating system was tightened It is estimated that over the 25 year period 1980 to 2005 there will have been an overall reduction in energy consumption of around 70 by the most popular sized refrigerators (with freezers) (Harrington L and Holt S 2002)

In addition to the energy consumption label there is a website (wwwenergyratinggovau) with a comprehensive database of all appliances their star rating and energy consumption In 2002 there were around 220000 hits on the programrsquos various websites and 523000 in 2003 reportedly representing 80000 visits by individual inquirers The website hit rate is estimated to represent almost 10 of consumers who are considering purchasing an appliance (Holt et al 2003)

Cooling

Energy Input (kW)

250

104

Figure B Excerpt from Energy Rating web page for Air Conditioners (cooling cycle only shown)

When the energy rating program was reviewed in 2000 technology had advanced to the point where the Scheme had to be tightened because a large percentage of appliances had achieved the maximum number of stars For example energy use by refrigerators was around 70 compared to that used when the scheme started (Harrington L and Holt S 2002)

60

Regulations

State and Territory legislation refer to the relevant Australian Standards This approach simplifies the State and Territory legislation and makes it relatively straightforward to maintain national consistency of appliance and equipment energy efficiency standards even when standards are continually being revised

The testing procedures and technical requirements for the label and also Minimum Energy Performance Standards (MEPS see below) are incorporated into the applicable Australian Standards Products for sale must be registered with one of the State regulators

Program Administration

The labelling program and MEPS program are administered by the National Appliance and Equipment Energy Efficiency Committee (NAEEEC) which is ultimately directed by the Ministerial Council on Energy

Requirements for Appliance Suppliers

Appliance suppliers are required to

bull Submit applications for product registration and these must include a test report or other data to demonstrate that the appliance meets the relevant Australian Standard

bull While test reports on three separate units are required for most products there is no particular requirement for test laboratories to be accredited or products certified for registration for energy labelling and MEPS in Australia Test reports from the manufacturers laboratory are satisfactory However if there is evidence that results from a particular laboratory are unsatisfactory regulators can mandate test reports from an accredited laboratory

Summary Mandatory labelling scheme backed by regulations and an Australian Standard

32 Water Appliances Water Efficiency Labelling and Standards (WELS) Scheme

Purpose

A labelling scheme backed by legislation to promote domestic water efficient appliances

Background and Strategy

A voluntary water efficiency industry administered labelling scheme has been in existence since 1988 The water efficiency ratings and details on the label design are covered in ASNZS 6400 The main incentive of the voluntary lsquoAAAAArsquo scheme

61

has been the publicity and cash rebates offered by water utilities However the coverage water efficiency performance requirements and impact of this program have been limited

In 2003 the Environment and Heritage Ministers agreed to implement a national Water Efficiency Labelling Scheme (WELS) for products such as shower heads washing machines dishwashers and toilets Consultation with industry and stakeholders was undertaken in 2003 with a strategic study published that identified the products to be included in the new labelling Scheme A Regulation Impact Statement (RIS) which identified the costs and benefits of various options and made various recommendations was published in March 2004 Following public review of the RIS some modifications were made to WELS

The WELS Scheme is backed by the following legislation and standard

Water Efficiency Labelling and Standards Act 2005 which establishes

bull the products subject to the Scheme and the requirements for registration and labelling

bull the standards to apply to WELS products setting requirements for water efficiency performance registration and labelling of these products

bull enforcement provisions including penalties bull the appointment of inspectors to investigate possible contraventions and sets

out their powers and obligations bull review and dispute resolution bull a program Regulator bull the making of regulations bull a requirement for annual reports and for an independent review after five years

Water Efficiency Labelling and Standards Regulations 2005 which

bull prescribes the circumstances in which a person other than the manufacturer of a WELS product may be taken to be the manufacturer of the product (eg an importer)

bull sets out procedures for the issuing and the payment of penalty infringement notices as an alternative to prosecution for offences against the WELS Act

bull specifying the information to be included on an identity card issued to a WELS inspector

Water Efficiency Labelling and Standards Determination 2005 amongst other things determines and establishes product registration fees and calls up the Australian Standard ASNZS6400 2005 Water-efficient products - Rating and labelling which

bull defines the products

bull specifies the assessment procedures (ie identifies test procedures in other Australian Standards)

bull provides the formulas to give products their star rating

bull specifies the labels and their application to products

62

Approximately twenty organisations were represented on the Standards Committee that developed the Standard

State and Territory legislation

The States and Territories have also enacted or agreed to enact complementary legislation to ensure that the WELS Scheme has comprehensive national coverage State and Territory legislation which is almost a mirror of the Commonwealthrsquos Water Efficiency Labelling and Standards Act 2005 enables the States and Territories to for example undertake certain responsibilities delegated to them by the Commonwealth Regulator appoint their own inspectors and enforce the WELS

Other features of WELS include

bull A product web database

bull With the exception of toilets no other products are required to meet mandatory water efficiency requirements (WES) but this may change over time The introduction of mandatory WES means that products not meeting the minimum performance requirements can not legally be sold

bull Products must be tested in accordance with the relevant Standard and must meet any minimum performance and water efficiency requirements in the Standard before they can be granted a WELS Water Rating label

bull It is up to manufacturers or their agents (eg importers in the case of imported products) to ensure that their products are correctly registered and labelled and comply with any other requirements of the Standard

There is a transition phase which gives manufacturers and importers time to test register and label products and to sell pre-existing stock From 1 January 2008 all products are required to display the WELS Water Rating labels irrespective of their date of supply

63

The WELS Water Rating label

Label Features

bull A star rating for a quick comparative assessment of the models water efficiency

bull Labels with 1 to 6 stars

bull Some products may also be labelled with a Zero Star Rated label which indicates that the product is either not water efficient or does not meet basic performance requirements

bull A productrsquos water consumption figure

bull There are provisions for swing tags if there is inadequate surface area for label or the item is likely to be marked by sticking the label on the product

Summary Mandated product labelling using lsquostarrsquo rating system Has a disendorsement label and has provisions to ban products

33 Gas Appliance Rating Scheme

Purpose

A gas labelling program to improve the energy efficiency of gas powered products

Background and Strategy

The Gas and Fuel Corporation of Victoria introduced energy labelling for gas water heaters in 1981 This scheme was taken over by the AGA in 1985 who in 1988 introduced a six star energy performance label This label was intended to be visually consistent with the star rating labels already familiar to consumers of electrical appliances

The labelling scheme is currently voluntary and still administered by the industry body

A range of gas appliances have been subject to minimum energy performance standards (MEPS) since the 1960s The current MEPS levels were set in 1983 and

64

Brand Model Type MjyearStar

RatingSRI

StorageCapacity

(ltrs)IndoorOutdoor

NaturalGas

Instantaneous 18969 59 I N

Instantaneous 18969 59 I N

lsquothe majority of models currently on the market appear to exceed current requirements by a comfortable marginrsquo (SEAV 2003 p 23)

The gas energy labels are similar in format to those found on electrical appliances except they are blue and show annual energy use in MJ

A trial web site listing gas water heaters available in Australia is also available (see below)

Bottle Gas

Rinnai Infinity

V Series

REU-V2632FFU-A (Infinity 26 plus internal) P

Rinnai Infinity

V Series

REU-V2632FFUC-A (HD2001 internal) P

A joint review of the scheme is under way by the Gas Industry and Governments and regulation is under consideration A three year work plan has been published under the Australian and New Zealand Appliance and Equipment Energy Efficiency Program

Summary Currently voluntary labelling using lsquostarrsquo rating system with mandatory minimum energy performance standards Future regulation is under consideration

34 Green Vehicle Guide

Purpose

To provide web-based comparable and accessible environmental data on new motor vehicles

Background and strategy

65

The Commonwealth government started publishing a booklet of fuel consumption data for new passenger and light commercial vehicles in the early 1980s and a low cost web database in more recent years

In 2004 the Government through the Department of Transport and Regional Services (DOTARS) expanded the fuel consumption guide into the Green Vehicle Guide The Green Vehicle Guide is a web based database that rates new passenger and light commercial vehicles on air pollution greenhouse emissions and fuel consumption and gives an overall lsquostarrsquo rating for each vehicle within each vehicle category (small medium luxury sports etc)

The data on which the scores are derived are provided voluntarily by the vehicle manufacturers however this data is based on mandatory Australian Design Rule certification test data

The Guide uses a 5 star rating system however it also assigns half stars resulting in a total of 10 levels

The Greenhouse Ratings are based on carbon dioxide emissions and the Air Pollution Ratings take into account the relative environmental impact of oxides of nitrogen hydrocarbons and particles The relative harmfulness of the pollutants (shown in table below) has been quantified based on the allowable concentrations under the Ambient Air Quality National Environment Protection Measure (NEPM)

Green Vehicle Guide Weighting of Regulated Vehicle Emissions

Vehicle Emission

(equivalent pollutant under Air NEPM)

Calculated

Relative

Harmfulness

Final

Weighting

Carbon Monoxide (CO) 0088 Not included

Oxides of Nitrogen (NOx) (based on

Nitrogen Dioxide)

4 1

Hydrocarbons (HC) (based on

photochemical oxidants as ozone)

5 1

Particulate Matter (PM) (based on PM10) 20 5

Source Real and Jones 2005

NOx and HC were given equal final weightings despite the slight difference in the calculated relative harmfulness primarily because under ADR7900 a combined HC+NOx limit is prescribed rather than individual limits for each pollutant

The higher weighting for particulate matter recognises its significant health impacts The Air Pollution rating scale was devised in such a way that a lsquotypicalrsquo car (that is most petrol engined passenger cars meeting the current emission standard at the time) receives a mid-point rating (5 out of 10)

66

The overall rating or stars is derived from the sum of the air pollution and greenhouse scores ie they are equally weighted

Development of the Green Vehicle Guide (see extract below) involved extensive consultation with vehicle manufacturers

Website Costs

The new highly automated web database which contains data on approximately 1400 vehicles and has sophisticated search facilities cost approximately $200000 to develop plus around $100000 was spent recently to improve the sitersquos usability This compares to the previous low cost database which together with the printed guide cost less than about $80000 per annum The low cost version lacked the automation was only updated annually and did not have the ability to compared vehicles

The manufacturers provide the data on line using special access codes This data is checked by DOTARS before it is uploaded onto the website It takes close to a full time position within DOTARS to administer the website and respond to website related queries

Market Research and Marketing

Before the new greenvehicleguidegovau website was launched DOTARS commissioned consumer surveys to determine the level of knowledge about the environmental impacts made by vehicles This research showed that around half of those surveyed had the belief that ldquoall new cars have the same level of impact on the environmentrdquo

It became apparent through the surveys that there was a need to provide consumers with meaningful information on the relative performance of different vehicles This was a view shared by the Productivity Commission who said that while markets provide extensive information to consumers regarding fuel consumption of motor vehicles ldquothe Australian Governmentrsquos Fuel Consumption Labelling Scheme and Green Vehicle Guide provide relatively low cost accessible and comparable information to consumers and may be justified as part of the more fundamental objective of encouraging consumers to reduce the adverse environmental impacts of motor vehicle userdquo The Productivity Commission also commented that government

67

sources of information of this type were seen as credible and reliable and held in higher regard than information provided by others

DOTARS has scheduled some follow up consumer research for 200062007

DOTARS has spent about $600000 in marketing the Green Vehicle Guide This has included advertising in weekend guides in newspapers developing facts sheets plus targeted marketing to motor vehicle journalists

Summary Website - voluntary but legislative base

4 Government-Industry Partnership programs

Government-Industry Partnerships are the basis of many environmental initiatives and can take a number of forms Industry and government negotiate the terms of the program which are normally detailed in a formal agreement which sets out the environmental objectives and the responsibilities of each party towards their achievement

The GovernmentIndustry Partnership programs outlined below indicate the varied nature of these initiatives

41 The National Packaging Covenant

The National Packaging Covenant (the Covenant) commenced in 1999 and is a voluntary agreement between all levels of government and companies throughout the packaging chain including raw material suppliers packaging producers and retailers The Covenant commits signatories to the implementation of best practice environmental management in areas such as packaging design production and distribution and research into life cycle issues Signatories to the Covenant produce action plans on the measures they will implement to reduce packaging waste and they report annually on their progress In this sense the Covenant provides flexibility to signatories to develop plans suitable to their own circumstances The Covenantrsquos success (it currently has over 600 signatories) is due to the active promotion of it by Government and key industry players

The Covenant is complemented by a regulation the National Environment Protection (Used Packaging Materials) Measure (the NEPM) which enables states and territories to use enforcement action to require companies that donrsquot sign the agreement to take steps to reduce their packaging waste Preceding the Covenant and the NEPM were a number of voluntary industry agreements but these were limited in scope and largely focused on companies in the beverage industry

42 National Industry Reduction Agreement

The Publishers National Environment Bureau (PNEB) was formed in 1990 as an association of the major publishers of newspapers and magazines in Australia to promote the recovery and recycling of old newspapers and old magazines primarily from community kerbside collections organised by local councils

68

The PNEB and a newsprint manufacturer have voluntarily entered into a series of five-year Industry Waste Reduction Agreements with the Commonwealth and State Governments Under the current (third) plan 2001-2005 newsprint recycling in Australia has grown to 754 nationally in 2005 from the 28 level when the PNEB was formed in 1990

43 StateLocal target based programs

There have been a number of agreements signed by state government departments and an industry group where there is a stated goal to reach a specific environmental target For example in the early 1990s there was a voluntary agreement with the EPA Victoria and companies in the Altona Chemical Complex in the western suburbs of Melbourne (which includes Australian Vinyls BASF Dow Chemicals and Qenos) to reduce hydrocarbon emissions by 50 within a specified timeframe The target was met and further emissions reductions were negotiated The NSW EPA-Oil industry petrol volatility agreement outlined below is another example of a target based program

44 NSW EPA-Oil Industry Memorandum of Understanding on Summer Petrol Volatility

In 1998 NSW established arrangements for the supply of low volatility petrol in summer in the Sydney Greater Metropolitan Region implemented through a Memorandum of Understanding between the then EPA and oil companies The principal reason for controlling petrol volatility in summer is to reduce evaporative emissions of VOCs (from vehicles and production and storage sites) which contribute to ozone formation

The Memorandum of Understanding operated over four summer periods from 1998 to 2002 and involved companies voluntarily reducing petrol volatility (measured in kilopascals (kPa) of vapour pressure) over three summer periods from a base of 76kPa to 70kPa in the first summer 67kPa in the second and 62 kPa in the last two years

Although the Memorandum of Understanding was successful in progressively reducing petrol volatility over the period of its operation it was not supported by all industry members Consequently agreement was reached with industry that summer petrol volatility limits should be regulated to ensure a level playing field for all industry participants and regulated limits will apply from the summer of 200405

69

5 Summary of Australian Benchmark Programs

Program National State

Summary of Approach Impact

Voluntary Programs Altona Chemical Complex (Vic)

Local Small industry group worked towards self determined targets

Very high

Energy Star National Standards based label Limited Gas appliance Rating Scheme

National Industry operated labelling scheme with stars assigned therefore has graded benchmarksminimum performance standards out dated web database being developed

Low

National Industry Reduction Agreement

National Small industry group worked towards negotiated targets

High

NSW EPA-Oil Industry MOU

State Small industry group worked towards negotiated targets but not all involved ndash lead to regulations

Moderate

Top Energy Saver Award

National Achievement based label Limited

Quasi Regulatory Green Vehicle Guide

National Well promoted web database star ratings assigned therefore has graded benchmarks data provided voluntarily but backed by ADR requirements

High

Stand-by power National Required to achieve voluntary targets or regulation will be introduced

Unknown

National Packaging Covent

National Performance based targets backed by legislation High

Regulatory Energy Efficiency Labels

National Labelling scheme with stars assigned therefore has graded benchmarksbased on Australian Standard web database

High

MEPS National Sets base benchmark and works with energy rating

High

WELS Scheme National Labelling scheme with stars assigned therefore has graded benchmarksbased on Australian Standardweb database

High

Wood heaters State Only one benchmark assigned regulations are not uniform

Moderate

authorrsquos assessment based on direct or indirect knowledge of these programs

70

Appendix 3 Productivity Commission Comments on Labelling and Minimum Performance Standards

The Productivity Commission an independent agency which is the Australian Governmentrsquos principal review and advisory body on microeconomic policy and regulation recently examined the cost effectiveness of improving energy efficiency As part of its review lsquoThe Private Cost Effectiveness of Improving Energy Efficiencyrsquo it examined labelling programs minimum mandatory energy efficiency requirements and other means of providing consumer information The final report contains some highly relevant material that is applicable to establishing a benchmarking scheme for small engines

The following is a summary of relevant conclusions from the Inquiry

Government Operated Labelling Schemes

From consumer research provided to the Commission it concluded that ldquothere is some evidence to suggest that consumers are now paying more attention to labels than they have in the pastrdquo

The Commission was positive about labelling programs as labels

bull directly address ldquoa source of market failure mdash the asymmetry of information between buyers and sellers of energy-using productsrdquo

bull provide information to the consumer that is readily-accessible and easily-understood and therefore can assist in helping the consumer make better-informed choices

bull are likely to have produced net benefits for consumers

bull do not directly limit consumer choice

bull could provide a greater incentive for suppliers to sell products that use energy cost effectively

bull probably produced net social benefits

bull are most suited where there is a wide spread in the range of performances of comparable appliances and where information failures are most pronouncedrdquo

bull can be used to warn consumers that an appliance is very inefficient (through a disendorsement label) which could be effective in discouraging but not preventing consumers from buying the poor performing product

The Commission was supportive of Governmentrsquos role of drawing together and packaging information through labelling programs as this ensures that ldquorelevant and trusted information gets to those who would otherwise not get itrdquo In material reviewed by the Commission George Wilkenfeld and Associates and Energy Efficient Strategies (1999) claimed that labelling is unlikely to be effective if purchasers rarely inspect appliances in a showroom where they can compare performance across

71

different models or the purchaser is not the ultimate user and so has little interest in operating costs

Labelling programs involves both administration and compliance costs such as those incurred by suppliers in having their products tested but the Commission considered that labels should be more actively considered as an alternative to minimum performance standards

Minimum Performance Standards

Governments can prevent the sale of inefficient products by using minimum standards for example the Minimum Energy Performance Standards (MEPS) that apply to appliances such as refrigerators and freezers air conditioners and electric water heaters If appliances do not meet the minimum standard they cannot be sold in Australia Some appliances are covered by both MEPS and by labelling (for example refrigerators)

The Commission considered that MEPS and labels can be complementary as MEPS act to penalise the worst energy performers whereas labels rewarding the better performers

Costs comparisons of schemes

The Department of the Environment and Water Resources provided details about the costs involved in administering both the labelling scheme and the minimum performance standards for energy programs It stated that

bull the administration costs of MEPS are substantially lower than for labelling but the compliance costs can be higher

bull MEPS can have a greater cost for suppliers than labelling since suppliers must adjust their model ranges to meet the MEPS levels by the given date These compliance costs are however influenced by the lsquolead inrsquo time between the introduction of the regulatory proposal and the implementation of the MEPS

bull it is estimated that the administration costs for MEPS would be $3 million over the period 2000ndash15 compared to $39 million for labelling (in present value terms) (George Wilkenfeld and Associates and Energy Efficient Strategies 1999) Furthermore it was assumed that 84 per cent of administration costs were borne by appliance purchasers with the remainder borne by governments

It estimated that MEPS would increase the cost of appliances by $266 million over 2000ndash15 compared to $688 million for labelling (the latter cost being due to consumers voluntarily purchasing more efficient appliances)

72

Page 3: Outdoor Garden Equipment - Department of the Environment

Contents

Disclaimer i

Acknowledgmentsi

Abbreviations and Glossaryii

Executive Summary iii

1 Introduction1

11 Emissions from outdoor garden equipment engines1

2 Air Quality and Outdoor Garden Equipment Engines4

21 Air Quality Standards 6

3 Emission Standards for Small Engines 8

31 Australia8 32 United States 8 33 Canada12 34 Europe 13 35 Summary of Regulations for Non Handheld Equipment15 36 Summary of Regulations for Handheld Equipment16

4 Australian Market for Small Engines 18

41 Likely compliance with overseas emissions standards18 42 Australian Sales of Outdoor Powered Equipment 22

5 Australian Users of Small Engines 25

51 General Public25 52 Garden and Ground Maintenance Services27 53 Government Purchasing28

6 Result of Stakeholder Consultation 30

61 Regulations 30 62 Discussion on recommended regulations31

7 The Way Forward 35

71 Options to Reduce Emissions from Garden Equipment Engines 38 72 Option 1 ndash Do Nothing 39 73 Option 2 ndash Industry - Government Partnership39 74 Option 3 - Quasi Regulation 39 75 Option 4 -Co Regulation40 76 Option 5 - Regulation40 77 Preferred Approach44

References 45

ii

Appendix 1 Detailed Breakdown of Powered Garden Equipment on the Australian Market 51

Appendix 2 Examples of Current Australian Benchmarking Programs55

Appendix 3 Productivity Commission Comments on Labelling and Minimum Performance Standards 71

iii

List of Figures

Figure 1 Example of a Californian Consumer Advisory Hang Tag11

Figure 2 Extract from survey form18

Figure 3 Compliance with overseas standards - all surveyed products20

Figure 4 Compliance with overseas standards by equipment type21

Figure 5 Engine type for popular categories 21

Figure 6 Compliance with overseas standards for popular categories 22

Figure 7 OPEA estimates of equipment sales in 2005-0624

List of Tables

Figure 1 Example of a Californian Consumer Advisory Hang Tag11

Figure 2 Extract from survey form18

Figure 3 Compliance with overseas standards - all surveyed products20

Figure 4 Compliance with overseas standards by equipment type21

Figure 5 Engine type for popular categories 21

Figure 6 Compliance with overseas standards for popular categories 22

Figure 7 OPEA estimates of equipment sales in 2005-0624

i

Abbreviations and Glossary 2c Two stroke with carburettor 2di Two stroke with direct fuel injection 2i Two stroke with pre-chamber fuel injection 4c Four stroke with carburettor 4i Four stroke with fuel injection (includes direct injection) ABS Australian Bureau of Statistics ABT Averaging Banking and Trading of emissions ADR Australian Design Rule Air NEPM National Environment Protection Measure for ambient air quality BTEX Benzene toluene ethylbenzene xylenes - carcinogenic or mutagenic aromatic

hydrocarbons formed through the combustion process CARB Californian Air Resources Board CBA Cost Benefit Analysis cc Cubic centimetres CO Carbon Monoxide DEC Department of Environment and Conservation di Direct Injection efi Electronic fuel injection EU European Union Euromot The European Association of Internal Combustion Manufacturers gkW- hr Grams per kilowatt hour HCs Hydrocarbons ndashmost are VOCS and in relation to small engines the terms are

often used interchangeably hp Horsepower 1 hp =7457 watts ISO International Standards Organization kW Kilowatts MEPS Minimum Energy Performance Standards MOU Memorandum of Understanding NATA National Association of Testing Authorities NOx Oxides of Nitrogen NPI National Pollutant Inventory NSW GMR New South Wales Greater Metropolitan Region which includes Sydney Lower

Hunter and Illawarra regions encompassing the major metropolitan centres of Sydney Newcastle and Wollongong Population approximately 47 million

OPEA Outdoor Power Equipment Association PM10 Particles with an aerodynamic diameter of 25 micrometres or less PM25 Particles with an aerodynamic diameter of 10 micrometres or less Port Phillip Region in Victoria of 24000 km2 that includes Greater Melbourne and Greater Region Geelong It is defined in Victorian environmental policy Population

approximately 34 million (1996) SE Qld South East Queensland - a region that covers the area from the Gold Coast to the

Sunshine Coast and west to Toowoomba It includes Brisbane amp suburbs population approximately 23 million people

USEPA United State of America Environmental Protection Agency VOCs Volatile Organic Compounds WELS Water Appliances Water Efficiency Labelling and Standards Scheme

ii

Executive Summary

Background

This report sets out the results of a project to compare and benchmark emissions from small petrol engines (less than 19 kilowatts) that are used to power outdoor garden equipment and were available for sale in Australia during 2006 The equipment powered by these small engines are used in lawnmowers brushcutters hedge trimmers and the like

These engines emit volatile organic compounds (VOCs) and oxides of nitrogen (NOx) which contribute to ozone (photochemical smog) formation in summer They also emit particles carbon monoxide (CO) and a range of air toxics such as benzene

Sydneyrsquos Greater Metropolitan Region (GMR) annually records exceedances of the National Environment Protection (Ambient Air Quality) Measure (Air NEPM) ozone standards The other jurisdictions meet or are close to meeting the current ozone standards

The Air NEPM standards are being reviewed and based on current human health evidence the argument appears to be strengthening for tighter ozone standards Should a stricter standard or an eight-hour standard consistent with international standardsguidelines be adopted achievability of Air NEPM ozone standards or goals could become an issue for some of the other major urban airsheds

The United States California Canada and Europe regulate emissions from outdoor equipment - the USA has had these in place since 1997 There are no Australian regulations or standards that limit air pollutant emissions from engines used in outdoor garden equipment however as the majority of equipment sold in Australia is imported some do comply with emission standards applicable to the country of origin

Small engines are not as advanced in environmental terms as motor vehicle engines As a result even the better-performing small engines emit far greater quantities of pollutants per hour than typical modern car engines For example the US Environmental Protection Agency (USEPA) 2002 limit for a typical 4 kilowatt (kW) lawnmower motor is about 66 grams (g) of regulated pollutants per hour of operation A typical 08kW brushcutter sold new in 2002 emitted about 160grams of pollutants per hour - reducing to 40grams per hour if bought new in 2006 The equivalent limit for cars under Australian Design Rule 79 is about 16g per hour In other words one hour of operation of a brushcutter that meets USEPA 2002 limits produces the same pollution as ten cars operated over a similar time These comparisons are subject to differences in test methods but they do provide an indication of the disproportionate amount of pollution emitted by small engines

Engines that do not comply with current USEPA requirements are likely to emit several times the amount of pollution calculated in the above example Therefore the worst performing engines are likely to emit more than ten times the emissions of the best performers

iii

Based on estimates made using the National Pollutant Inventory database engines used in lawn mowers contribute approximately 4 on average to VOC emissions from anthropogenic sources in major airsheds in Australia when public open space lawn mowing is included This is likely to rise to around 11 in the warmer spring and autumn weekends which is when lawns and other vegetation grows faster and when gardening is more popular The NPI does not take into account emissions from other types of powered outdoor equipment

The Australian Market

According to the Outdoor Power Equipment Association (OPEA) approximately 424000 walk behind lawnmowers and more than 792000 units of outdoor handheld equipment were sold in Australia in 2005-06 In addition there were sales of about 80000 replacement engines and 70000 pumps in 2005-06 most of which were four strokes The general household consumer represents the major market segment for garden equipment accounting for up to 90 of product sales with commercial garden services and government purchasing the rest

Indications are that sales of imported high polluting two stroke engines have increased over the last few years and it appears that the price of some powered garden equipment has dropped to the level where consumers regard them as disposables

An assessment of outdoor equipment on the Australian market found that the majority of small engines sold in Australia are imported and many come from countries that impose emission limits The extent of imports into Australia that do not comply with the country of origin standards is not known However the industry estimate that 40 of garden products are sold through importers who are not linked to manufacturers of US EPA or European certified equipment and the source of some products sold here is difficult to establish Victa is the only company producing small engines in Australia Its iconic 2-stroke lawn mower engine currently does not meet overseas emission limits for non-handheld equipment and Victa is undertaking research and development to reduce emissions from its two stroke engine to meet US and European standards

In spite of several attempts to obtain data on compliance with overseas emission standards from Australian distributors their response was poor The following figure therefore provides a best estimate of expected compliance of outdoor equipment on the Australian market with European CARB or USEPA requirements applicable in 2004

iv

Figure E1 Compliance with overseas standards for popular categories ldquoPhase 1 equivrdquo means the engine complies with US EPA phase 1 or 200288EU ldquoPhase 2 equivrdquo means the engine complies with US EPA Phase 2 Euro I or Euro 2 ldquoUnknown means that engine cycle (stroke) was not provided

Measures to Increase Sales of Low Emission Garden Equipment Engines

There is a range of options that could be considered for reducing emissions from engines used in outdoor garden equipment engines in Australia These include

1 Maintaining the Status Quo

2 Government ndash Industry Partnership Program

3 Quasi regulation

4 Co-regulation

5 Regulations based on either a simple benchmark or tiered benchmarks

The Small Engine Expert Panel ndashOutdoor Equipment has considered in depth the most appropriate approach to take to improve the emissions performance of outdoor garden equipment sold in Australia It recommends the introduction of national regulations to control the emissions from outdoor garden equipment particularly in light of the increase in cheap imports onto the Australian market which although untested are considered very likely to have high emission levels The Expert Panel has developed some broad recommendation on which Australian regulations could be based which takes in consideration the local market and Victa These are summarised as follows

1 Mandatory air pollutant emission standards to be introduced in Australia for all outdoor equipment (lt19kW) powered by spark-ignition engines

v

The development of any regulation would need to be based on a formal assessment of the costs and benefits of nationally regulating two and four stroke lawn mowers and handheld power equipment which should commence immediately

2 Proposed standards to mirror US EPA regulations (compliance with equivalent EU regulations also acceptable)

3 Timing (subject to completion of assessment of costs and benefits)

(a) US EPA Phase 1 ndash Effective from 20072008

(b) US EPA Phase 2 ndash Fully implemented in 2012 (in step with 2007 USEPA limits) plus a phase-in period andor provisions for averaging banking and trading (ABT) of emissions over 2008-2012 to provide for early introduction of cleaner product

The US EPA Phase 1 and Phase two emissions limits are given in the table below

4 Walk-behind two stroke mowers to be included in US EPA Category 5 (gt50cc) product classifications (to provide Victa time to develop a cleaner engine) Implementation timing is proposed to be the same as Recommendation 3 above

5 All products also to be certified to relevant EPA product durability categories

6 Subject to further review ABT if included may be phased out after 2012

Table E1 Comparison between the USA Phase 1 and Phase 2 standards

Emission Limits GkW-hr

Phase 1 (1997 ndash2001) Phase 2 (2007) HC NOx HC+NOx CO HC+NOx CO

Non-handheld

I-A lt66cc 161 161 610

I-B 66-lt100cc 161 161 610

I 100-225 cm3 161 519 161 610

II 225 cm3 134 519 121 610

Handheld

III lt20 cm3 295 536 805 50 805

IV 20-50 cm3 241 536 805 50 805

V 50 cm3 161 536 603 72 603 Phase 2 limits were phased in between 2002 -2007 during which time they became tighter

For simplicity only the 2007 are shown in this table (see Table 2 for more details)

vi

Conclusion

From this review it is apparent that it is highly unlikely that the companies in the industry would engage in or commit to any voluntary type program It is therefore clear that the most expedient path to reduce emissions from these small engines is through national regulation State based regulations could only provide a piecemeal approach that would lead to product dumping in states where there are no regulations and inconsistent regulations that require industry to treat each state market differently In addition enforcement of any state based regulations would be a key problem due to existing Commonwealth and State Government mutual recognition legislation

While any national regulation of emissions from small engines used in garden equipment in Australia are likely to be based on overseas regulations they need to strike a balance between improved environmental outcome harmonisation with international standards and the characteristics of the local industry With regulations optimum emissions reduction are potentially achievable by combining minimum emissions standards with tiered product labelling Whether this approach is justifiable on economic grounds that is the benefits outweigh the costs can only be determined through a detailed impact assessment Based on these findings it is recommended that a formal assessment of the costs and benefits of nationally regulating two and four stroke lawn mowers and handheld power equipment should be commenced

vii

1 Introduction

This report sets out the results of a project to compare and benchmark emissions from engines used in outdoor garden equipment that were available for sale in Australia during 2006 Possible outcomes from the project range from consumer guidelines for selecting low emission engines to regulatory controls on emissions There are currently no state or national regulations that directly control emissions from these engines

The project was commissioned by the Commonwealth Department of the Environment and Water Resources on behalf of state and territory government departments working on reducing the impacts of small engine emissions This report was prepared in consultation with an Expert Panel that included representatives from the Outdoor Power Equipment Association (OPEA)

11 Emissions from outdoor garden equipment engines

Small engines particularly conventional two stroke engines used in applications such as outdoor garden equipment are high polluters relative to their engine size and usage1 These small engines emit volatile organic compounds (VOCs) and oxides of nitrogen (NOx) which contribute to ozone (photochemical smog) formation in summer They also emit particles carbon monoxide (CO) and a range of air toxics such as benzene The USA California Canada and Europe and regulate emissions of VOCs NOx carbon monoxide and particle emissions from outdoor garden equipment

There are five types of spark-ignition engines that can be used in outdoor garden equipment

bull two stroke with carburettor (2c)

bull two stroke with pre-chamber fuel injection (2i)

bull two stroke with direct fuel injection (2di)

bull four stroke with carburettor (4c)

bull four stroke with fuel injection (4i) (includes direct injection)

Carburettor and pre-chamber fuel injection two stroke engines are inherently more polluting than the other three types This is due to their inability to completely separate the inlet gases from the exhaust gases resulting in up to 30 of the fuel being left unburnt and the need to add oil to the fuel to lubricate the engine (four stroke engines have separate reservoirs for fuel and oil) However twostroke carburettor engines typically weigh less than a four stroke engine of the same power and this tends to make them attractive for handheld equipment They also tend to have fewer components are generally cheaper to purchase and are cheaper to maintain than

1 Outdoor equipment covered in this report are engines less than 19kW

1

four stroke motors Victa Lawncare is currently undertaking research and development to improve the environmental performance of two stroke carburettors and while some emission improvements have been made a two stroke compliant with US or European standards is still considered several years away

Four stroke carburettor engines are generally quieter more fuel efficient and are less polluting than conventional two stroke engines

Direct fuel injection (dfi) either two stroke or four stroke overcomes the unburnt fuel problem and can meet the stringent regulated exhaust emission limits that apply overseas However there is not any evidence that dfi engines are being used in outdoor garden equipment available in Australia It appears that engines used in outdoor garden equipment in Australia are generally restricted to two and four stroke carburettor engines

Small engines are not as advanced in environmental terms as motor vehicle engines As a result even the better-performing small engines emit far greater quantities of pollutants per hour than typical modern car engines For example the US Environmental Protection Agency (USEPA) 2002 limit for a typical 4 kilowatt (kW) lawnmower motor is about 66 grams (g) of regulated pollutants per hour of operation A typical 08kW brushcutter sold new in 2002 emitted about 160grams of pollutants per hour - reducing to 40grams per hour if bought new in 2006 The equivalent limit for cars under Australian Design Rule 79 is about 16g per hour In other words operated over a similar time one hour of operation of a brushcutter that meets USEPA 2002 limits produces the same pollution as ten cars and a 4kW lawnmower the same pollution as four cars These comparisons are subject to differences in test methods but they do provide an indication of the disproportionate amount of pollution emitted by small engines

Engines that do not comply with current USEPA requirements are likely to emit several times the amount of pollution calculated in the above example Therefore the worst performing engines are likely to emit some ten times the emissions of the best performers

Because of the combustion of oil these engines also emit high levels of particles Although small engines only contribute a small amount to total particle emissions the rate of particle release compared to other engines can be very high For example lawnmowers can emit over 10 times more particles (in terms of grams per hour) than a petrol motor vehicle (manufactured between 1994 and 2001)

All the above emission comparisons between outdoor garden equipment engines and motor vehicles are subject to differences in test methods but they indicate the disproportionate amount of pollution emitted by small garden equipment engines It also needs to be recognised that motor vehicles in Australia average more than 15000 kilometres per year (ABS 2003) while the annual average use of outdoor garden equipment is around 25 hours for a lawnmower and less for other types of equipment Commercial operators however are likely to have a much higher usage rates than the general public

2

This paper examines the Australian market for small engines used in lawnmowers and handheld garden equipment their impact on air quality relevant overseas regulations and their applicability to Australia and makes recommendations to reduce air quality impacts from these engines

A wide range of information sources has been referenced for this report including data and information supplied by manufacturers distributors and dealers in small engines

3

2 Air Quality and Outdoor Garden Equipment Engines

Emission inventories make estimates of emissions of substances from a multitude of sources into airsheds The National Pollutant Inventory (NPI) which is run cooperatively by the Australian state and territory governments contains data on 90 substances that are emitted to the Australian environment The substances included in the NPI have been identified as important because of their possible health and environmental effects Industry facilities estimate their own emissions annually and report to states and territories Non-industry (or diffuse) emissions estimates which includes emissions from outdoor garden equipment are made by the states and territories on a periodic basis using information sources such as surveys databases and sales figures

The NPI only reports emissions from domestic lawn mowing and for a few airsheds the contribution made by public open space lawn mowing It does not report on the contribution made by other types of outdoor garden equipment such as brushcutters National and selected state NPI emissions estimates for the common air pollutants and for Air Toxics NEPM pollutants from domestic lawn mowing are summarised in Table 1 It should be noted that national emissions from lawn mowing are underestimates as the NPI records emissions for major airsheds only and therefore is not Australia wide plus the estimates do not include evaporative emissions from fuel tanks and hoses

This NPI data is indicative only as the accuracy and completeness of the data sets varies across airsheds and is reliant on the estimation techniques used For example while the population in the NSW is higher than other airsheds its emissions look disproportionally high when compared to the other airsheds This could be because the estimation technique varies or it is due to some other factor

4

Table 1 National Pollutant Inventory Domestic Lawn Mowing Emission Estimates

Substance Port Phillip

Population 34 mill (1996)

SE Qld

Population 23 mill

NSW GMR

Population 47 mill

Adelaide

Population 10 mill

National

Common Air Pollutants (tonnesyear)

Carbon monoxide 12000 12000 24000 6100 69000

Total Volatile Organic Compounds 3600 3800 7000 2000 21000

Particulate Matter 100 um 86 94 170 9 460

Sulphur dioxide 5 5 9 50 81

Oxides of Nitrogen 63 54 120 24 330

Air Toxics (tonnesyear)

Benzene 230 210 390 130 1200

Formaldehyde 56 38 NA 31 180

Polycyclic aromatic hydrocarbons 07 11 21 04 41

Toluene (methylbenzene) 370 360 660 210 2000

Xylenes (individual or mixed isomers) 270 260 490 150 1500

Analysis of the NPI database at the national level shows that domestic lawn mowing is the

- Fourth largest source of benzene contributing 7 to the total reported airshed load

- Fourth largest source of formaldehyde contributing 3 to the total reported airshed load

- Fifth largest source of xylene contributing 6 to the total reported airshed load

- Fifth largest source of toluene contributing 6 to the total reported airshed load

- Sixth largest source of carbon monoxide contributing 12 to the total reported airshed load

- Ninth largest source of VOCs contributing 3 to the total reported airshed load when biogenics (natural sources such as trees and soil) are excluded

The NSW Department of Environment and Conservation has been upgrading its emissions inventory Based on 2003 emissions data non-road anthropogenic sources

5

contribute 619 of the VOCs to the GMR airshed Preliminary results2 indicate that VOC emissions from domestic and public open space lawn mowing contributes on an annual average 41 of all VOC emissions in the GMR On a typical weekend during warmer weather this percentage rises to 11

Therefore it could be assumed that lawn mowing could contribute approximately 4 on average to VOC emissions from anthropogenic sources in major airsheds in Australia when public open space lawn mowing is included This percentage is likely to rise significantly in the warmer spring and autumn weekends which is when lawns and other vegetation grow faster and when more people garden

21 Air Quality Standards

In June 1998 the National Environment Protection Measure for Ambient Air (Air NEPM) established national uniform standards for ambient air quality for the six most common air pollutants ndash carbon monoxide nitrogen dioxide photochemical oxidants (measured as ozone) sulfur dioxide lead and particles less than 10 microns (PM10) The NEPM was varied in 2003 to include PM25 advisory reporting standards and in April 2004 a National Environment Protection Measure for Air Toxics was adopted

Nationally the common pollutants of most concern (particularly in major urban areas) are fine particles and ground level photochemical smog (measured as ozone) which is formed in the warmer months when volatile organic compounds (VOCs) and oxides of nitrogen (NOx) react in the atmosphere under the influence of sunlight in a series of chemical reactions

Recent health studies (cited in NEPC 2005) have strengthened the evidence that there are short-term ozone effects on mortality and respiratory disease The studies also strengthen the view that there does not appear to be a threshold for ozone below which no effects on health are expected to occur In recent years Australian epidemiological studies have been conducted which confirm the results of overseas studies that there is a relationship between elevated ozone levels and hospitalisations and deaths from certain conditions

There are two national ozone standards a one hour standard of 010ppm and a four hour standard of 008ppm with a goal that allows for one exceedance per year by 2008 Sydney experiences a number of days each year of ozone levels above these standards In 2003 Sydney exceeded the one hour standard on 11 days in 2003 19 days in 2004 and 9 days in 2005 The four hour standard was exceeded on 13 days in 2003 19 days in 2004 and 13 days in 2005 Further reductions in VOC and NOx emissions are needed to reduce ozone concentrations in Sydney to levels that would comply with the Air NEPM

The other jurisdictions meet or are close to meeting the current National Environment Protection (Ambient Air Quality) Measure (Air NEPM) ozone standards (NEPC 2005) However the ozone standards are being reviewed and based on current human health evidence the argument appears to be strengthening for tighter ozone standards

2 Presentation to Expert Panel 27 April 2006 by Nick Agipades Manager Major Air Projects NSW DEC

6

Should a stricter standard or an eight-hour standard consistent with international standardsguidelines be adopted achievability of Air NEPM ozone standards or goals could become an issue for some of the other major urban airsheds (NEPC 2005)

Modeling of ozone for Sydneyrsquos Greater Metropolitan Region (GMR) indicates that the implementation of Euro emission limits for on-road vehicles and hence the increased presence of these less polluting vehicles in the fleet and retirement of old more polluting vehicles from the fleet is not sufficient to meet the current NEPM goals Modeling suggests that very large reductions in precursor emissions would be required to meet the current ozone one hour goal (NEPC 2005)

Even when the effects of bushfires and when hazard reduction burning are taken into consideration airsheds such as Launceston Melbourne and Sydney struggle to meet the national standards for particles (EPA 2006) However outdoor powered equipment predominantly from two stroke engines makes only a minor contribution to ambient fine particle loads

While carbon monoxide emissions from engines used in outdoor garden equipment are regulated overseas air monitoring in Australia indicates that carbon monoxides levels are well below the national air quality standards and there are no pressing issues requiring CO from outdoor powered equipment to be regulated In addition data indicates that lowering emissions of VOCs and NOx from small engines reduces CO emissions

Many of the pollutant sources which contribute to the formation of ozone and to particle levels also contain air toxics such as benzene toluene formaldehyde and xylenes These air toxics have been shown to be responsible for a range of health problems including asthma respiratory illnesses and cancer The National Environment Protection Measure for Air Toxics requires each jurisdiction to monitor and report annually on five air toxics benzene polycyclic aromatic hydrocarbons formaldehyde toluene and xylenes The monitoring data is intended to inform future policy and also the public on ambient levels of these air pollutants Monitoring of air toxics to date shows that levels are low and below the national monitoring investigation levels (EPA Vic 2006 DEC 2006)

7

3 Emission Standards for Small Engines

31 Australia

At present there are no Australian regulations or standards to limit air pollutant emissions from small (two and four stroke) engines Australia does benefit to some extent from overseas regulations as many lawnmowers and other gardening equipment sold in Australia have engines manufactured in the United States or Europe where strict standards apply

32 United States

In the United States emission regulations set by the United States Environmental Protection Agency (USEPA) and the Californian Air Resources Board (CARB) apply to lawn mowers and other powered gardening equipment Although CARB standards currently tend to be stricter than USEPA standards by 2006 emissions limits applying under the two standards will be very similar

United States Environment Protection Agency (US EPA)

In 1995 the USEPA introduced ldquoPhase 1rdquo regulations covering small non-road engines with a power of not more than 19kW (25HP) The regulations applied to equipment manufactured from 1997

These regulations have seven classes of equipment based on portability and engine displacement volume (ldquocapacityrdquo) In March 2000 the USEPA published ldquoPhase 2rdquo regulations which are shown in Table 2 These set limits for combined emissions of hydrocarbons (HC) and oxides of nitrogen (NOx) and separate limits for carbon monoxide (CO) emissions and for two stroke engines only particles

Table 2 US EPA Phase 2 Small Engine Emissions Standards (HC+NOx in gkW-hr) (a) (b)

Small Engine Class

Type 2002 2003 2004 2005 2006 2007+

I-A (lt66cc) Non-handheld (eg lawnmowers)

- 161 161 161 161 161

I-B (66 to lt 100cc) - 161 161 161 161 161

I (100 to lt 225cc) - 161 161 161 161 161

II (225cc or more) 180 166 150 136 121 121

III (lt20cc) Handheld (eg trimmers)

238 175 113 50 50 50

IV (20 to lt50cc) 196 148 99 50 50 50

V (50cc or more) - - 143 119 96 72 (a) As carbon monoxide (CO) levels in Australia are well below the Air NEPM standard the

USEPA emission limits for CO have not been included in this table (b) Includes useful life criteria of 50125300 hours

8

When the USEPA introduced ldquoPhase 2rdquo regulations it included averaging banking and trading provisions (ABT) which were seen ldquoas an important element in making stringent Phase 2 emissions standards achievable with regard to technological feasibility lead time and costrdquo (USA 1999) The USEPA also claimed (USA 2000) that the ABT program secures early emissions benefits through the early introduction of cleaner engines

ABT provisions which apply to handheld and non handheld engines are complex but in broad terms averaging means the exchange of emission credits among engine families within a given engine manufacturerrsquos product line This allows a manufacturer to produce some engines that exceed the standards and offsetting these exceedances with emissions from engines that are below the standard Manufacturers are allowed to exchange credits from handheld to non handheld and vice versa Banking means the retention of emission credits by the engine manufacturer generating the credits for use in a future model year (for averaging or trading) Trading is the exchange of emission credits between engine manufacturers which then can be used for averaging purposes banked for future use or traded to another engine manufacturer

In January 2004 USEPA reported that in 2002 averaging was being used but there was very little use of banking It determined that the initial ABT programs as too complex and included discount rates on credits ABT was simplified in 2004 including the elimination of credit discount and multipliers and limits on credit life To date there has reportedly been limited use of banking however it is anticipated that there will be more widespread use of banking credits if the USEPA proposed Phase 3 comes into effect3 (see below)

Particulate limits (2gkW-hr) also apply to two stroke engines Carbon monoxide and durability limits (or useful life) are also prescribed The durability criteria which were introduced in Phase 2 require that the emission limits must be met through the useful life of the engine The manufacturer determines useful life of each product using standardised product testing procedures and then based on the test results selects the useful life category for each product which can be 125 250 or 500 hours These durability criteria acknowledge the large disparity in usage patterns by equipment type and between commercial and residential users It also takes into account the ability of manufacturers to design and build engines for various design lives and which fit the types of equipment engine is produced for

The March 2000 USEPA report (USEPA 2000) estimated that the expected effects of the Phase 2 regulations would be

bull A 70 reduction in HC+NOx beyond the Phase I standards (which were estimated to have reduced emissions by 32 from the unregulated baseline)

bull A 30 reduction in fuel consumption of small handheld equipment bull Price increases of between $US23 (Class III) and $US56 (Class V) for

handheld equipment

3 Dave Gardner Briggs and Stratton email 22506

9

The US EPA is currently considering lsquoPhase 3rsquo regulations which are catalyst based standards to further reduce exhaust HC and NOx emissions from non handheld engines reduce evaporative HC and NOx emissions for both handheld and non handheld engines plus include extended durability criteria These limits are currently at discussion stage only They align with CARB Tier 3 but a longer lead time is proposed

Table 3 Proposed Phase 3 Exhaust Emissions

HC+NOx gkW-hr

CO gkW-hr

Year Useful life hrs

Class I 100 610 2010 125250500

Class II 80 610 2011 2505001000

Class III-V No changes

HC+NOx std is based on averaging

Californian Air Resources Board (CARB)

Spark ignition engines

CARB regulations first introduced emission limits for small engines manufactured from1995 The more recent schedule of emission limits are shown in Table 4 These limits depend solely on the engine capacity and apply to both handheld and non handheld classes

Table 4 CARB Emission Limits for Small Engines (HC+NOx in gkw-hr)

Engine Capacity 2000-2001 2002-2005 2006+

65cc or less 72 72 72

gt65cc to 225cc 161 161 161

gt225cc 134 121 121

California has particle limits for two strokes useful life criteria and mandatory engine labeling including a consumer advisory hang tag as shown in Figure 1 The USEPA is also considering introducing an air index label

10

Figure 1 Example of a Californian Consumer Advisory Hang Tag The Californian regulations take into account sales weighted emission performance for families of engines An engine family is essentially the same engine being used in different equipment items

In 2003 California adopted a Tier 3 program for exhaust and evaporative emissions and these are based on the use of catalytic convertors The engine classes better align with US EPA categories however the exhaust standards for Class I and Class II are more stringent than the existing US EPA standards

Table 5 CARB Tier 3 for Exhaust Emissions

Model Year Displacement Category

Durability Periods (hours)

HC+NOx gkw-hr

CO gkw-hr

Particulate gkw-hr

2005 and subsequent

lt50 cc 50125300 50 536 20 + 50-80 cc inclusive 50125300 72 536 20 +

2005 gt80 cc - lt225 cc Horizontal-shaft eng

125250500 161 549

gt80 cc - lt225 cc NA 161 467 Vertical-shaft Engine 225 cc 125250500 121 549

2006 gt80 cc - lt225 cc 125250500 161 549 225 cc 125250500 121 549

2007 gt80 cc - lt225 cc 125250500 100 549 225 cc 125250500 121 549

2008 and subsequent

gt80 cc - lt225 cc 125250500 100 549 225 cc 1252505001000 80 549

the 1000 hours is applicable for 2008+ Model Year (MY) + applies to 2 stroke only Source California Exhaust Emission Standards and Test Procedures For 2005 And Later Small Off-Road Engines Adopted July 26 2004 effective on October 20 2004

California also has Blue Sky provisions These are voluntary standards for engines that meet the criteria shown in Table 6 Blue Sky Series engines are not included in

11

the averaging banking and trading program Zero-emission small off-road equipment (eg push mowers) may certify to the Blue Sky Series emission standards

In 2005 CARB aligned its test procedures with the USEPA

Table 6 CARB Blue Sky Provisions

Model Year Displacement Category

HC+NOx gkw-hr

CO gkw-hr

Particulate

2005 and subsequent lt50 cc 25 536 20

50 - 80 cc inclusive 36 536 20

2007 and subsequent gt80 cc - lt225 cc 50 549

2008 and subsequent 225 cc 40 549 Applicable to all two stroke engines

33 Canada

The Canadian small engine market has similarities to the Australia market the majority of small engines are imported from the USA and there is one Canadian manufacturer of small spark ignition engines and one major manufacturer of lawn and garden machines

A Memorandum of Understanding (MOU) which came into effect on 1 January 2000 was signed between Environment Canada and ten manufacturers of handheld equipment and nine manufacturers of engines used in non handheld machines The MOU was intended as an interim measure until regulations could be put in place Under the MOU the manufacturers agreed to voluntarily supply small spark ignition engines designed to meet the applicable USEPA Phase 1 emission standards

In 2003 Canada regulated emission limits for handheld and non-handheld small engines based on USEPA emission limits The regulations apply to model years 2005 and later While there are no separate averaging banking and trading provisions in Canadian regulations Canada allows any USEPA certified engine to be sold in Canada This means that engines that do not meet the standard level but are averaged (or use credits) in the United States can be sold in Canada Manufacturers are required to produce upon request evidence of conformity to the standards and are required to provide written instructions on engine maintenance to the first retailer

12

Table 7 Canadian Small Spark-Ignition Engine Exhaust Emission Standards

Engine class

Engine Type

Engine Displacement (cm3)

Effective date (model year)

Standard HC+NOx (gkWshyhr)

Standard NMHC+NOx (gkW-hr)

Standard CO (gkWshyhr)

I-A Non-handheld lt66 2005 and

later 50a -shy 610a

I-B Non-handheld

lt100 and 66

2005 and later

40a 37a 610a

I Non-handheld

lt225 and 100

2005r 161b 148a 519b 610a

II Non-handheld 225 2005 and

later 121a 113a 610a

III Handheld 20 2005 and later 50a -shy 805a

IV Handheld lt50 and 20 2005 and later

50a -shy 805a

V Handheld 50 2005 2006 2007 and later

119a 96a

72a

-shy-shy

-shy

603a 603a

603a a Standards apply throughout the engine useful life b Standards apply only when the engine is new Source Canada Gazette Part II Vol 137 No 24 2003-11-19

34 Europe

In 1998 the European Union introduced exhaust emission limits for small petrol engines through Directive 9768EC and in 2002 introduced amendments through Directive 200288EC The limits in the Directives align with the US regulations however they do not have averaging and banking provisions

Table 8 European Emissions Standards

Small Engine Class Type (HC+NOx in gkW-hr) 2004 2005 2006 2007 2008

SN1 (lt66cc) Non-handheld (eg lawn mowers)

161 161 161 161 161

SN2 (66 to lt 100cc) 161 161 161 161 161

SN3 (100 to lt 225cc) - - - 161 161

SN4 (225cc or more) - - 121 121 121

SH1 (lt20cc) Handheld (eg trimmers)

- - - 50 50

SH2 (20 to lt50cc) - - - 50 50

SH3 (50cc or more) - - - - 72

13

The European Union is currently considering including useful life criteria and averaging and banking provisions plus it is considering introducing a Directive to further reduce emissions from diesel engines The objective of the proposal is to tighten emissions standards for engines in general non-road applications in light of technological developments and it taking into account the parallel developments for similar legislation in the United States in order to harmonise the environmental standards and to facilitate trade

Charts comparing the USA Californian and European Emission Limits are shown below

14

35 Summary of Regulations for Non Handheld Equipment

KEY TO CHARTS

USEPA CARB EU

0

10

20

30

40

50

60

70

80

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

0 to 49cc

0

10

20

30

40

50

60

70

80

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

50 to 65cc

0

2

4

6

8

10

12

14

16

18

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

100 to 224cc

0

2

4

6

8

10

12

14

16

18

20

2000

2002

2004

2006

2008

Year Model

HC

+N

Ox g

kW

-hr

225cc and over (up to 19kW)

15

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

36 Summary of Regulations for Handheld Equipment

KEY TO CHARTS

USEPA CARB EU

20 to 49cc 0 to 19cc

250 250

200

150

HC

+N

Ox g

kW

-hr

100

200

HC

+N

Ox g

kW

-hr

150

100

50 50

0 0

Year Model Year Model

50 to 65cc 66 to 80cc

160

160

140

140

120

40 40

20 20

0 0

120

HC

+N

Ox g

kW

-hr

HC

+N

Ox g

kW

-hr

100100

8080

60 60

Year Model Year Model

16

Summary of Regulations for Handheld Equipment (continued)

KEY TO CHARTS

USEPA CARB EU

0

20

40

60

80

100

120

140

160

2000

2001

2002

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

81 to 224cc

0

20

40

60

80

100

120

140

160

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

225cc and over (up to 19kW)

17

4 Australian Market for Small Engines

41 Likely compliance with overseas emissions standards

As part of this assessment an environmental profile of equipment currently on the Australian market has been developed initially based on information from manufacturersrsquo brochures and web sites and industry magazines and then confirmed through follow-up with relevant industry contacts

Each item of equipment has been assessed on its compliance with USEPA CARB or European regulations In most cases it was not possible to match models available on the Australian market with CARB lists (CARB publishes exhaust emissions data on all appliances on its web site) This was mainly due to the inconsistency of model designations and uncertainty about ldquoengine familiesrdquo

Engine characteristics and retail price were difficult to obtain Some brochures also made claims of compliance with USEPA European or CARB requirements The detailed breakdown of current equipment on the Australian market is given in Appendix 1

The majority of small engines sold in Australia are imported and many come from countries that impose emission limits The extent of imports into Australia that do not comply with the country of origin standards is not known Industry estimates that 40 of garden products are sold through importers who are not linked to manufacturers of US EPA or European certified equipment and the source of some products sold here is difficult to establish Victa is the only company producing small engines in Australia Its iconic 2-stroke lawnmower currently cannot meet overseas emission limits

Outdoor Power Equipment Association (OPEA) assisted in identifying the Australian distributors of most brands of powered garden equipment In April 2006 a survey form was sent to a total of 43 distributors representing 97 brands of equipment The survey form sought information about the engine for all petrol-fuelled garden equipment with a power not more than 19kW

Figure 2 Extract from survey form

18

Initial response to the survey was poor Despite follow-up action and efforts from the industry association at the beginning of September 2006 26 distributors had responded to the survey information and only 13 distributors provided all data necessary for benchmarking purposes This resulted in emission compliance data for about half of the estimated products on the Australian market Attempts to match Australian models with the database maintained by the Californian Air Resources Board were also of limited success due to inconsistencies in model designations between Australia and the USA and the manner in which model information is coded in the CARB database

Table 9 Summary of distributor responses

Responses status Not OPEA OPEA ALL

Number of responses 9 8 (31) 17 (40)

Response - all data 4 9 13 (30)

Response - extra time sought 3 3 (7)

Response - no petrol products 4 1 5 (12)

Response - some data 5 5 (12)

Grand Total 17 26 43 percentages may not add to 100 due to rounding

Of the 97 brands initially identified

bull 16 brands are apparently no longer sold in Australia

bull No responses were received for 29 brands

bull Partial data were received for 12 brands

bull All data was available for 30 brands

Table 10 Summary of responses by brand

Count of brands

Analysis status Not OPEA OPEA All

Missing some data 12 12

No data received 9 (27) 20 (31) 29 (30)

No longer sold 13 3 16

Response - no models to list 3 7 10

Response received (electronic form) 5 11 16

Response received (paper form) 3 2 5

Response received (spreadsheet) 9 9

All 33 64 97

A 2004 report for the NSW DEC estimated that there were about 1200 eligible garden

19

products in the Australian market The current project has obtained data for a total of 870 products or 72 of the estimated population In addition the sampling method is likely to be biased towards products with good environmental performance In these circumstances the following analysis should be regarded as indicative only

Survey results

The following tables and figures show expected compliance with European CARB or USEPA requirements based on the limited information provided by industry

Table 11 Engine type and compliance with overseas standards Count of products Engine type

Best STD 2c 4c Unknown All 1997 - US EPA I 53 32 85 (10) 200288EU 17 17 (2) 2004 - US EPA II 1 3 4 (lt1) 2004 EURO I 8 8 (1) 2005 - US EPA II 10 29 5 44 (5) 2006 - US EPA II 107 141 2 250 (29) 2006 EURO I 6 6 (1) 2007 - US EPA II 1 1 (lt1) 2007 Euro II 2 2 (lt1) None 118 90 208 (24 Unspecified 24 60 161 245 (28) All 344 358 168 870

Unknown means the type of engine is unknown (but is most likely to be 2c) Unspecified means that the status of emissions compliance was unable to be identified None means the manufacturerdistributor has indicated that the equipment does not comply with any overseas emissions standard

Figure 3 Compliance with overseas standards - all surveyed products Note Unknown in chart includes unspecified and unknown from Table 11

20

Figure 4 Compliance with overseas standards by equipment type ldquoPhase 1 equivrdquo means the engine complies with US EPA phase 1 or 200288EU ldquoPhase 2 equivrdquo means the engine complies with US EPA Phase 2 Euro I or Euro 2 ldquoUnknown means that engine cycle (stroke) was not provided

Of the 41 categories of equipment in the survey 15 had at least 10 current products Results for these categories are set out below

Figure 5 Engine type for popular categories

21

Figure 6 Compliance with overseas standards for popular categories ldquoPhase 1 equiv means the engine complies with US EPA phase 1 or 200288EU Phase 2 equiv means the engine complies with US EPA Phase 2 Euro I or Euro 2 ldquoUnknown means that engine cycle (stroke) was not provided

42 Australian Sales of Outdoor Powered Equipment

The Australian Outdoor Power Equipment Association (OPEA) whose membership represents about 80 of the manufacturersdistributors and dealers in the industry commissions regular independent industry audits of garden equipment sales (OPEA personal communications) Sales data from OPEA is shown in Table 12

22

Table 12 Sales of outdoor garden equipment 2002 and 2005-06 2005-06 2 stroke (1000)

2002 2 stroke (1000)

2005-06 4 stroke (1000)

2002 4 stroke (1000)

2005-06 TOTAL (1000)

2002 TOTAL (1000)

Walk behind mowers 72 170 351 76 424 246

Brushcuttertrimmer 321 12 17 180 339 192

Chainsaws 152 0 0 90 152 90

Chipper shredders 0 60 46 0 46 60

Blowerblower vacuums 98 0 11 50 109 50

Ride on mowers 0 25 51 0 51 25

Generators 11 32 96 0 107 32

Hedge trimmers ampothers 40 192 0 28 40 220

694 491 476 424 1267 915

for total sales 593 463 407 537

for mowers 152 280 848 720

According to OPEA approximately 424000 walk behind lawnmowers and more than 792000 units of outdoor handheld equipment were sold in Australia in 2005-06 In addition there were sales of about 80000 replacement engines and 70000 pumps in 2005-06 most of which were four strokes These figures show that there has been considerable growth in the sales of most products with the exception of chipper shredders and the category lsquohedge trimmers and othersrsquo whose sales declined in 2005shy06 compared with those in 2002 About 17 of walk behind lawnmowers were two stroke and 83 four stroke which is an improvement in the uptake of cleaner engines when compared to 2002 when about 30 were two stroke The situation with handheld equipment is reverse with nearly 79 being two strokes compared to 47 in 2002 However many models of two stroke handheld equipment meet current US emission standards and care should be exercised in using engine type (two stroke or four stroke) as an indicator of emissions performance for this class of equipment

The OPEA 2005-06 sales estimates are shown in Figure 7 OPEA cautions that there is considerable uncertainty about the estimates for brushcutters and blowerblower vacuums as OPEArsquos figures only represent 50 and 60 respectively of sales of these products No estimates of future sales trends were identified during research for this project

23

Australian sales of 2 and 4 stroke outdoor equipment 2005-6

0 50 100 150 200 250 300 350 400

Walk behind mowers

Brushcuttertrimmer

Chainsaws

Chipper shredders

Blowerblower vacuums

Ride on mowers

Generators

Other

Annual sales (x 1000)

4s 2s

Figure 7 OPEA estimates of equipment sales in 2005-06 Note Blowervac is an industry term for equipment that combines blowing and vacuuming functions

Briggs and Stratton (Australia) who import engines from the USA supply the majority of the four stroke engines for handheld equipment sold in Australia and these comply with all the current USA and CARB regulations Imported handheld garden equipment is shipped fully assembled to a branch or distributor and is then sent to a retailer The retailer may or may not provide equipment servicing

OPEA members have expressed concern regarding the increasing sales of imported high polluting two stroke engines that allegedly do not meet any emission standards and come from countries that do not have emission standards One industry representative reported that some of the imported trimmers were being manufactured in China using outdated designs and tooling from two old bankrupt American companies and these are being sold here at about 30 of the price of traditional brands and very low cost generators from China now account for around 70 of total sales It is difficult to confirm this trend without undertaking a detailed examination of Australian import data however the significant increase in the sales of two stroke handheld equipment provides some support for this trend

On the other hand it is claimed by industry that the ride on mower market (predominately with compliant four stroke engines) has been stimulated by the Australian USA free trade agreement

24

5 Australian Users of Small Engines This section examines the market segments for garden equipment and customer purchasing behaviour

51 General Public

Purchasing behaviour

Research into consumer purchasing behaviour has found that consumers assess a product against a range of attributes for example price weight brand reputation servicing and parts availability warrantees and guarantees experience size promotions and discounts Studies have also revealed that up to 82 of Australians had bought products on the basis of social or environmental factors in the previous year (State Chamber of Commerce 2001) Related to this point the energy star rating ecolabel on whitegoods was viewed as a credible environmental claims system which is well regarded by the general consumer (Product Category Manager Mitre 10 personal communications)

As the purchase of small engine garden equipment by the general consumer is an infrequent purchase which carries a certain of amount of risk With small engines the risk can be functional risk (will not perform as expected) physical risk (for example safe features such automatic cut out on an electric lawn mower) or financial risk especially for the more expensive items The general consumer is likely to lessen the risk by seeking information and by evaluating the information on the available products over a period of time The consumer may also lessen the risk by

bull purchasing well known brands

bull buying the brand offering the best warrantees and guarantees

bull buying the most expensive brand and

bull buying a brand they have used before

Research indicates that the desired attributes of a product may not be well established at the start of a consumerrsquos search process but will often be refined as the consumer learns more about the product The consumer will also use a ranking and weighting process based on desired qualities and trade offs may be made

Reportedly purchases of engine operated garden equipment are based on price yard size fitness for purpose and other features such as weight and ease of starting (Product Category Manager Mitre 10 personal communications) Males are the predominant purchasers of garden equipment however because of changing demographics there has been an increase in the number of women purchasing these products

Less than 5 of lawnmowers purchased are push or electric mowers (Product Category Manager Mitre 10 and industry sources personal communications 2003)

25

Electric mowers are generally perceived as not being as effective as cords have limited range and rechargeable electric mowers require frequent recharging

There is a recent trend towards ride on mowers (all four strokes) probably because of changing demographics specifically older age groups moving to more rural environments with larger yards (OPEA personal communications)

A study (Wilkie 1994) investigated consumer appliance purchasing behaviour and found that the general consumer consulted a range of information sources before purchasing an appliance The appliance salesperson was found to be the most important information source for many consumers Other important information sources include newspaper advertisements friends and relatives catalogues consumer reports and brochureslabels Since Wilkiersquos study the internet will have become increasingly important as a research tool and in some instances as a way to purchase products As part of this study there is evidence of low priced products being sold into the Australian market via the internet only ndash a practice that is likely to increase in the future It was difficult to source any compliance or details on these products

At the retail chain level staff product training is generally voluntary undertaken out of store hours and as an inducement to attend training sessions suppliers usually provide incentives for staff Retail chain purchases are very price driven although some chains are reportedly interested in stocking goods that have credible environmental claims (Mitre 10 and other retail chain sources)

IBIS (2006a) reports that the domestic hardware sector which is dominated by Danks (Home Timber and Hardware Thrifty - Link Hardware and Plants Plus Garden Centre) and Bunnings is classified as a growth market and the sales of lawnmowers and other lawn and garden machinery and equipment represent about 14 of sales revenue

In summary it appears that a range of product attributes influences consumer purchases of lawnmowers and outdoor equipment Currently there is very little information about emissions in any of the information sources a consumer is likely to consult when purchasing these products Nevertheless surveys indicate that consumers are concerned about the environment and are open to including environmental considerations into their purchase decision Educating sales staff about the air emissions from lawnmowers and outdoor equipment together with ecolabels could therefore be important methods for influencing consumers towards the purchase of cleaner products

Equipment Usage

The USA Outdoor Power Equipment Institute CARB (cited in USEPA 1998) and the USEPA (USEPA 1998) have made estimates of annual usage rates and average life spans of outdoor equipment for the general consumer user and for the commercial user Table 13 gives USA usage and lifespan range for selected items of powered equipment

26

Table 13 USA Average Usage and Lifespan of Outdoor Garden Equipment For General Consumers and Commercial Users Equipment Annual usage (Hours) Lifespan (years)

General Consumer

Walk- behind mowers 20-25 6 -7

Rear engine ride on mowers 4 6 -7

Chainsaws 7 5-9

Leaf blowers 9-12 5-9

Trimmers 10 5-9

Commercial User

Walk- behind mowers 320 27

Rear engine ride on mowers 380 38

Chainsaws 405 1-13

Leaf blowers 170-293 18-28

Trimmers 170 - 275 15-28

Discussions with members of the Australian industry confirm that Australian hours of use are likely to be similar to the American estimates although this can vary depending on location For example in tropical areas lawns are mowed more often because they grow faster in this climate The American turnover of equipment is however probably higher than here as the Australian consumer tends to keep their equipment longer and so the useful life of a mower is more likely to be on average 10 ndash12 years

52 Garden and Ground Maintenance Services

According to a recent IBIS report (2006b) the revenue for this industry in 2005-06 was $383 million and the industry outlook is lsquobrightrsquo with a predicted annual average 5 growth over the next few years The Australian customer base for garden maintenance services including for lawn mowing is

Households 55 Business 25 Government 20

The sector is reportedly a growth industry due to

bull the aging population

bull the increasing numbers of households that are time poor income rich and

bull the growing trend for professional landscaping which requires a higher level of garden maintenance

27

The main customer base for these businesses includes middle to upper socioeconomic groups the aged and people who are physically disabled Growth is predicted particularly for the franchise industry with demand from the commercialindustrialgovernment sectors (IBIS 2003) A 1999 ABS survey reported that nearly one-third of older people purchased at least one domestic service per fortnight with gardening assistance being the most common This accords with an industry estimate that about 25 of householders pay someone to mow their lawn (Jim Penman Jimrsquos Mowing personal communication) The industry is sensitive to economic conditions and weather for example the drought has slowed growth over the last few years

The garden maintenance sector is dominated by small independent operators with two major franchisers Jimrsquos Mowing and VIP VIP nationally has 600 franchises and Jimrsquos Mowing about 400 Jimrsquos Mowing reportedly mows about 15000 lawns and has 53 of the market (IBIS 2006b) As franchised lawn mowing services represents about 14 of the lawn mowing services nationally it can be estimated that approximately 280000 lawns are mowed nationally by commercial operators

Jimrsquos Mowing and VIP provide training and advice to new franchisees on equipment including proper maintenance schedules Training generally occurs before franchisees purchase their equipment Most franchisees equipment would consist of two mowers a brushcutter an air blower and possibly a hedge trimmer or chain saw Operators prefer four stroke mowers and these are used for an average eight hours per week Brushcutters are generally two strokes as are other motors (IBIS 2006b and Jim Penman personal communication)

From the above it is estimated commercial operators operate mowers for up 34 million hours per year (or 8 of the total estimated mowing hours per year) and purchase approximately 66000 lawnmowers annually (25 of purchases) The sectorrsquos purchases of brushcutters is estimated to be approximately 8000 units per year or 37 of purchases Table 13 provides US commercial userrsquos annual average hours of use and average equipment life spans ndash it would be anticipated Australian rates would be similar

The main businesses contracting to provide ground maintenance services to the corporate and government sector (including universities) are Spotlessrsquos Open Space Management Transfield and Programmed Maintenance Services all of which are diversified publicly listed companies plus the Danish owned company ISS (previously Tempo Services) (IBIS 2003 and 2006b and company websites) The type of services they provide means it is likely they would have an array of equipment and a preference for the more powerful ride-on mowers and for Class V handheld equipment

53 Government Purchasing

The way purchasing decisions are made by government or other large organizations is generally very different to the approach taken by the general household consumer

bull many of the purchases are for large quantities of goods

28

bull there are well established policies and procedures in place to guide purchasing with the purchase criteria established early in the buying process and

bull those making the purchase are likely to be more knowledgeable about the product than the average consumer and they are usually not the eventual user of the goods

Value for money fitness for purpose ability to supply and over recent years environmental aspects are likely to be important factors in the purchasing decision for Government

Local State and Commonwealth Governments have responsibility for the upkeep of public assets many of which include public open space and other outdoors areas At the State and Federal level these include schools universities sporting facilities hospitals and defence facilities These services may be outsourced individual departments may undertake maintenance and purchase their own equipment or they may purchase equipment through a central purchasing facility With the central purchasing facility these items are generally purchased under contract While there is an increase in the inclusion of environmental considerations in the selection criteria for purchasing goods and services especially under contract these considerations mainly relate to waste management and recycling criteria and not air emissions

Local councils in some states for example NSW generally take responsibility for ground maintenance within their council areas or for some smaller councils the service may be contracted to a neighbouring council In other states such as Victoria there is a trend to outsource ground maintenance contracts to commercial providers

It is unknown what proportion of total sales that direct Government purchases represent however it likely to represent a relatively small share of several percent of the overall market

In summary

bull The general household consumer represents the major market segment for garden equipment accounting for up to 90 of product sales

bull Government is likely to be relatively small direct purchaser of garden equipment

bull Commercial garden services to households purchase approximately 25 of lawnmowers per year and 37 of brushcutters

bull Large ground maintenance companies are likely to prefer larger and more powerful equipment such as ride-on mowers

29

6 Result of Stakeholder Consultation

61 Regulations

The Small Engine Expert Panel ndash Outdoor Equipment considered in depth an approach to take to improve the emissions performance of outdoor garden equipment sold in Australia Discussions were particularly focused on the growing influence of cheap high emissions imported products together with the difficulties that the local manufacturer of lawn mowers is likely to face in complying with the relevant overseas standards As part of this process the industry representatives on the Panel held additional discussions and they consulted international industry experts at the manufacturing level in Europe the USA and Japan

OPEArsquos preference is for the adoption of regulations based on the USEPA standards with Phase 1 being adopted possibly from as early as 2007-08 The industry then proposes that Phase 2 be introduced in 2012 Phase 1 USA EPA standards were adopted in the USA in 1995 to be applied to equipment manufactured from 1997 and Phase 2 standards were introduced in 2002 through to 2007 and these included averaging banking and trading provisions A comparison between the USA Phase 1 and Phase2 standards is given in Table 14 The USEPA is discussing Phase 3 limits for the adoption in 20102011 which includes tighter exhaust emission limits for non-handheld equipment

The emissions limit of the two stroke lawn mower manufactured by the sole Australian manufacturer are well above USA Phase 1 limit for non-handheld equipment One avenue to address this issue which was supported by the Expert Panel ndash Outdoor Equipment would be to place lawn mowers in the US EPA Category 5 (engines gt50cc) This would result in emissions for two stroke lawnmowers being limited to 161 gkW-hour HC + NOx compared to the USA regulated limit of 161 gkW-hour HC + NOx Doing this would align the ramp-up timetable for mowers with that of other garden products

Table 14 Comparison between the USA Phase 1 and Phase 2 standards

Emission Limits GkW-hr

Phase 1 (1997 ndash2001) Phase 2 (2007) HC NOx HC+NOx CO HC+NOx CO

Non-handheld I-A lt66cc 161 610 I-B 66-lt100cc 161 610 I 100-225 cm3 161 519 161 610 II 225 cm3 134 519 121 610 Handheld III lt20 cm3 295 536 805 50 805 IV 20-50 cm3 241 536 805 50 805 V 50 cm3 161 536 603 72 603

Phase 2 limits were phased in between 2002 -2007 during which time they became tighter for simplicity only the 2007 are shown in this table (see Table 2 for more details)

30

In addition to limiting emissions the Expert Panel support the inclusion of the durability criteria which apply in the USA under Phase 2 standards and certification documentation from either the USA or Europe as adequate proof of conformity Equipment that has not been tested and certified to USA or European standards will be required to have the engines tested in a NATA certified laboratory

Some in the industry argued that regulations should include provisions for averaging for companies that wish to use it however they felt banking and trading provisions would not be necessary Industry representatives were not supportive of any Australian consumer labeling requirement instead OPEA members are willing to supply emissions data for inclusion in a web-based database that would allow purchasers to assess the environmental credentials of different makes and models

62 Discussion on recommended regulations

Timing of introduction

Some industry representatives argue that introduction of Phase 1 standards in 2007-08 will not give the industry an adequate transition period in which to develop competence in emissions certification establish new procedures and tooling in the dealers workshops train dealers and technicians on legal requirements distribute specific tooling and spare parts and reduce stocks of old (non certified) products without incurring an undue financial burden While others in the industry prefer progressing straight to phase 2 standards

If the OPEA preference for the adoption of the United States Phase 1 regulations which operated in the USA between 1995 and 2001 were introduced in Australia in 2007-08 they would be well behind the USA standards and worldrsquos best practice Furthermore the introduction of the United States Phase 2 - 2007 limits in Australia in 2012 would if the USEPA introduce Phase 3 in 2010-11 see emission limits for lawnmowers and other non handheld garden equipment in Australia still lagging United States standards and worldrsquos best practice

To introduce regulations in 2007-08 will require Government firstly to determine the most appropriate mechanism under which to enact the regulations draft the regulations prepare the regulatory impact assessment consult with the broader community and then finalise the regulations It is likely an Act of Parliament will be required at the Commonwealth level followed by complementary legislation at the State and Territory level It is possible for this to be achieved in less than a two year timeframe (as was the case for the Water Efficiency Labelling Scheme) However regulations that do not have a level of perceived urgency would take longer The level of importance and urgency to control emissions from small engines has yet to be debated and determined

31

Modified USEPA limits for lawnmowers

From the 183 lawn mowers identified through the market survey Victa is the main (possibly sole) provider of two stroke mowers with the other lawnmowers having cleaner four stroke engines

Victa is undertaking work to produce a cleaner product Victa estimates it would need a number of years to complete development production tooling and commercialisation of the cleaner engines In January 2007 it released a new two stroke carburettor lawnmower that has reduced engine emissions by more 30 but the combined HC and NOx emissions are still above USEPA Phase 1 limits Victa says this new engine is the outcome of four years of collaborative work by Victa and the University of Technology Sydney Victa is continuing with this research to further reduce emissions

A clause that allows exemptions to be granted as occurs in other countries could be included in the regulations however Victa argues that this would create uncertain trading conditions for the company for a period of time until an exemption were granted

Placing lawn mowers in the US EPA Category 5 (engines gt50cc) has the risk of opening the Australian market to more two stroke lawn mowers which has the greatest use of any outdoor powered equipment however it should see the continuance of the sole engine being manufactured in Australia In 1995 when it was introducing small engine emission limits the USEPA faced a similar issue with two stroke lawn mowers and used a similar approach by allowing two stroke lawn mowers to comply with the handheld standards It also specified that the number of two stroke lawnmower engines allowed to meet handheld standards would be subject to a declining annual production cap with the allowance provided by the production cap being phased out in 2003 There is also similar precedent for small engine emission limits that depend on engine type - European regulations for marine outboard motors set less stringent requirements for two stroke motors

Averaging Banking and Trading Provisions

The US EPA did not have averaging banking and trading provisions in Phase 1 and therefore all small outdoor engines were required to meet the Phase 1 limits It only introduced ABT provisions in the much more stringent Phase 2 as they would allow the most economic introduction of cleaner engines The industry claims the systems to use this provision are available and can be implemented in Australia by those who wish to use it at little cost to government

Industry claim that any supportive economic data related to averaging is sensitive and confidential It is there difficult without substantial justification by the industry to support the provision for averaging in conjunction with Phase 1 particularly given the elapsed time between the introduction of Phase 1 in the USA and their recommended introduction in Australia If there are some low volume equipment items that still cannot meet the USAEPA Phase 1 standards then these could be subjected to

32

exemptions if adequate justification can be provided (exemptions for small volumes were available under the USEPA regulations)

It was noted that for government to implement regulations a regulatory impact statement is required and this requires an assessment of the costs and benefits of the options considered with clear overall benefits shown for the preferred option Therefore if the option for manufacturers to use averaging were to be considered more information to support its inclusion would be required

Other options that could be considered to circumvent the inclusion of averaging include

i including clauses that give manufacturers the ability to apply for exemptions from the regulations for classes of equipment that have small sales volumes (these provisions are available in the USA)

ii limiting the regulation to popular types of equipment

iii using the end-of-model life provisions that have been used in the Australian Design Rules for cars In effect the end of model life provisions require new designs to comply from the implementation date but allow older models to remain on sale for a few more years This is an alternative to ABT because it facilitates earlier introduction of the regulation

iv Having a phase in period of say 2 years during which existing models can continue to be sold but new models coming on to the market must comply with the new standards At the end of the phase-in period all models must comply with the new standards This is an approach that is used when Australian Design Rules (ADRs) are introduced for motor vehicles

Consumer Information

Current Australian directions to reduce the environmental impact of consumer products favor tiered benchmarks using a lsquostarrsquo rating system (see Appendix 3 for examples such as the Mandatory Energy Efficiency Label and the Water Efficiency Labelling Scheme)

As products generally arrive in Australia assembled and packaged industry considers a mandatory requirement to label products with an Australian style star rating would impose a cost on distributors that would drive up the retail price of products Instead the OPEA members were willing to supply emissions data for inclusion in a web-based database that would allow purchasers to assess the environmental credentials of different makes and models Given the diverse nature of the industry it is unlikely a database would provide complete coverage of all products on the Australian market but inclusion in the database would indicate that the manufacturer has a commitment to environmental performance It was acknowledged in discussions that at least some Phase 2 compliant products would become available prior to 2012 and the web-based database would provide one method to promote those cleaner engines

33

In summary the Recommendations of the Expert Panel

1 Mandatory air pollutant emission standards to be introduced in Australia for all outdoor equipment (lt19kW) powered by spark-ignition engines The development of any regulation would need to be based on a formal assessment of the costs and benefits of nationally regulating 2 and 4 stroke lawn mowers and handheld power equipment which should be commenced immediately

2 Proposed standards to mirror US EPA regulations (compliance with equivalent EU regulations also acceptable)

3 Timing (subject to completion of assessment of costs and benefits)

(a) US EPA Phase 1 ndash Effective from 2007 2008

(b) US EPA Phase 2 ndash Fully implemented in 2012 (in step with 2007 USEPA limits) with phase-in period andor ABT over 2008-2012 to provide for early introduction of cleaner product

4 Walk-behind 2 stroke mowers to be included in US EPA Category 5 (gt50cc) product classifications Implementation timing to be as in Recommendation 3 above

5 All products also to be certified to relevant EPA durability categories

6 Subject to further review ABT (if included) may be phased out after 2012

34

7 The Way Forward

The optimum approach for garden equipment out engine emissions of options needs to be sustainable and cost effective This will need to be determined through a costs and benefits analysis (CBA) CBA assigns monetary values and typically assesses the impacts on the consumer on human health on the environment on industry and on government A detailed costs and benefits analysis is beyond the scope of this report however the following sections draws on available information to provide some indication of the possible costs and benefits that are associated with emissions from garden equipment engines

Air Quality Benefits

Environment Canada estimated the introduction of the regulations would result in a 44 percent reduction in combined HC+NOx emissions from small engines used in garden equipment and reduction in individual air pollutants over a 25 year period as shown in Table 15 The Canadian estimates incorporate the benefits that would accrue from the MOU signed with the industry in 2000 plus the benefits from the regulations introduced in 2003 In 2000 Canada imported around 13 million small spark-ignition engines and machines (ie a similar number to Australia) with 80 supplied by the USA

Table 15 Canadian Small Spark-Ignition Engine Emissions in Year 2025

Substance Base Case Emissions in 2025

Emissions in 2025 with Regulations

Percentage Reduction in 2025 (Regulations vs Base Case)

Criteria Air Contaminants (kilotonnes)

HC 772 410 469

NOx a 84 67 201

CO 1413 1403 07

Greenhouse Gas (kilotonnes)

CO2 2903 2645 89 Base case year 2000 (accommodating voluntary agreement) Source Canada Gazette Part II Vol 137 No 24 2003-11-19

Other Environmental Costs and Benefits

In addition to the human health benefits associated with reduced exposure to ozone there is a range of other public benefits including reduced damage to vegetation and therefore higher crop yields less damage to materials and structures particularly

35

some rubber products and improved visibility due to a reduction in smog haze Plus there are benefits associated with lower emissions of other air pollutants

To date there appears to have been little work undertaken in assigning a monetary value to these benefits as it is considered that they are likely to be small compared to human health impacts

Health Costs and Benefits

The Final Impact Assessment for the Ambient Air Quality National Environment Protection Measure (NEPC 1998) estimated that the health damage costs from exposure to ozone nationally to be in the range of $90 ndash $270 million (in 1998 dollars) This figure did not include mortality costs because of difficulty in assigning a figure to human life nor did it include costs associated with minor symptoms such as sore throat cough headache chest discomfort and eye irritation that can result from ozone exposure On the cost of ozone exposure the Impact Assessment states that lsquothe social well-being associated with potentially 6 and 20 million fewer irritating symptoms annually cannot be reliably quantified but at $1 a symptom it adds up to an appreciable amountrsquo

Since the Air NEPM Impact Assessment ozone levels in Australian urban areas have not fallen significantly but the population and medical costs have increased since then However using the above figures to make a rough estimate the contribution made by engines used in lawnmowers (ie not including other garden equipment) to the health damages cost from ozone exposure would be at a minimum $36 - $108 million not including the cost of mortality or minor symptoms As any action on these engines is likely to only remove high emission engines over a decade or more a CBA would be required to include an assessment of the proportional health benefits that would accrue from only removing the high emitters over time

Costs and Benefits to the Consumer

In 1995 the USEPA estimated that on average the cost to the engine manufacturer to install the necessary emission control technology to meet Phase 1 standards (which didnrsquot have ABT) would be approximately $US2 per engine used in nonhandheld equipment and $US350 per engine used in handheld equipment It also estimated that this would translate to sales-weighted average price increases of about $US7

The introduction of phase 2 regulations USEPA estimated would result in price increases of between $US20 and $US64 for handheld equipment depending on the equipment class (USEPA 2000) where handheld engines ranges in price from $60 to $1000 (USEPA 1995)

In addition to emission reductions the implementation of exhaust emission limits has the advantage of reducing fuel consumption and lowering operating costs to the consumer For example the USEPA estimated that for Phase 1 limits that applied between 1995 and 2001 on an average sales-weighted engine basis would decrease fuel consumption by 26 percent for non handheld equipment and a 13 percent decrease in fuel consumption for handheld equipment (USEPA 1995) Phase 2

36

(current limits) would result in a further decrease in fuel consumption of approximately 30 percent for handheld engines

When the USEPA considered the fuel savings offset and the retail price increase it estimated that the average sales-weighted lifetime increase in cost would be about $US650 per handheld engine while nonhandheld engines will realize a lifetime savings of about $US250 per engine This does not include the lifetime savings in maintenance costs which should further benefit the consumer (USEPA 1995)

Euromot (The European Association of Internal Combustion Manufacturers) claims that compliance with European minimum performance standards that do not have ABT provisions adds around 30 to the cost of some products that have had to be brought into compliance4 compared to products sold under the ABT system in the US

Costs and Benefits to Industry and Government

As there is only one local manufacturer among the 43 distributors of powered outdoor garden equipment sold in Australia and all others are importers the main costs to reduce the emissions contribution made by these engines will be associated with program administration and compliance particularly if regulations are introduced

The Productivity Commission an independent agency which is the Australian Governmentrsquos principal review and advisory body on microeconomic policy and regulation recently examined the cost effectiveness of measures to improve the energy efficiency in household appliances As part of its review lsquoThe Private Cost Effectiveness of Improving Energy Efficiencyrsquo it examined labelling programs (ie regulated tiered benchmarks) and minimum mandatory energy efficiency requirements (ie a regulated simple benchmark) While the household appliance market is considerably larger than the garden equipment market the Commissionrsquos final report contains some information that is useful for determining the approach that could be used to establish an emissions reduction scheme for garden equipment A summary of relevant sections of this report is provided in Appendix 3

The Commission identified both administration and compliance costs associated with labelling programs and minimum mandatory energy efficiency requirements as well the impacts these had on product suppliers

The Department of the Environment and Water Resources provided details to the Commission on the costs involved in administering both the labelling scheme and the minimum performance standards for energy programs The information provided showed that

bull the administration costs of the simple benchmark approach were substantially lower (less than one tenth) than for labelling and 84 per cent of administration costs were passed on to appliance purchasers with the remainder borne by governments

4 Presentation by Dr Holger Lochmann Rob Baker Axel Rauch Stihl 19 April 2006

37

bull the compliance costs for labelling are higher

bull minimum mandatory energy efficiency requirements can have a greater cost for suppliers than labelling since suppliers must adjust their model ranges to meet the MEPS levels by the given date These compliance costs are however influenced by the lsquolead inrsquo time between introduction and the implementation of the regulations

bull The increased cost to appliance purchasers of labelled appliances was about two and half times higher compared to appliances purchased under minimum mandatory energy efficiency requirements this being due to consumers voluntarily purchasing more efficient appliances

Overall the Commission considered that labels should be more actively considered as an alternative to minimum performance standards The Commissionrsquos support was based on the ability of labels to amongst other things

bull directly address ldquoa source of market failure mdash the asymmetry of information between buyers and sellers of energy-using productsrdquo

bull provide information to the consumer that is readily-accessible and easily-understood so they can help the consumer make better-informed choices

bull Have net social benefits and possibly have net benefits for consumers

bull provide a greater incentive for suppliers to sell environmentally better products

bull warn consumers through a disendorsement label that an appliance is very inefficient This approach can discourage but not prevent consumers from buying the poor performing product

71 Options to Reduce Emissions from Garden Equipment Engines

There is a range of options that could be considered for reducing emissions from engines used in outdoor garden equipment in Australia These include

1 Do nothing

2 Partnership Programs

3 Quasi regulation

4 Co-regulation

5 Regulations

In the following discussion about these options many Australian examples are mentioned Further details about these programs plus an overview are provided in Appendix 2

38

72 Option 1 ndash Do Nothing

Based on data supplied by OPEA the sales of high emitting two stroke carburettor engines as a percentage of engines used in outdoor equipment increased during the period 2002 to 2005-6 (see Table 12) from 463 to 593 and overall sales number increased by 38 during that period There is no indication that in the short to medium term that sales of equipment with two stroke carburetor engines will decrease in overall sales numbers or as a percentage of sales Therefore under the lsquodo nothingrsquo option emissions from outdoor garden equipment will continue at the same rate or perhaps based on sales figures of two stroke carburetor powered equipment at an even higher rate in the future

73 Option 2 ndash Industry - Government Partnership

In the discussion papers prepared for the NSW small engine project (2004) some examples of successful voluntary Government-Industry Partnership programs were provided The examples included were

bull the National Industry Reduction Agreement where the major newspaper and magazine publishers in Australia agreed to promote recovery and recycling of old newspapers and magazines

bull the NSW EPA-Oil Industry MOU on Summer Fuel the National Packaging Covenant (which has legislative backup) and

bull the EPA Victoriarsquos agreement with the Altona Chemical Complex

From the Australian programs reviewed it appears that the best indicators for successful partnership programs are

bull a relatively small number of firms within the industry

bull a commitment and involvement by all of the industry

bull clear program aims and objectives plus program targets and

bull a willingness by the industry to enter into a cooperative partnership with government

There are 43 identified distributors selling 97 brands of outdoor powered equipment in Australia Many of the major distributors are members of OPEA but there are many distributors who are not members It is therefore unlikely that the even the majority let alone all of the Australian distributors would commit to a industry-government partnership to reduce emissions

74 Option 3 - Quasi Regulation

Quasi regulations can take a range of forms the most usual being the establishment of a code of practice that industry endorses and implements A fundamental part of the code of practice would be emissions standards There are few examples of the use of codes of practice to limit emissions

39

Governmentrsquos role under this scenario is likely to be in assisting in the development of standards

The likelihood of this option being successful for similar reasons to the industry government partnership option is low

75 Option 4 -Co Regulation

Co-regulation is an agreement by industry and government to certain undertakings that support the uptake of cleaner products with a regulatory base It allows industry program flexibility to achieve certain negotiated targets Australian examples of coshyregulation include

bull The Green Vehicle Guide which operates through an industry government agreement where industry report test results to government in an agreed format within a certain timeframe Government manages the data and promotes the program This program is underpinned by Australian Design Rules for motor vehicles

bull The electrical appliance stand-by power program where there are agreed targets established that industry is required lsquovoluntarilyrsquo to meet failure to achieve the targets will result in regulation

bull The Packaging Covenant which is a program that allows industry the flexibility to design it own programs to reduce packaging waste and achieve certain target The Covenant is complemented by the NEPM on used packaging which specifies certain government responsibilities to support the program plus measures that will be introduced if targets are not met

Given the large number of distributors on the Australia market co-regulation for engines used in garden equipment using a similar form to the standndashby power program or the packaging program - an agreement by industry and government on a percentage reduction target for the sale of high emitting engines within a specified timeframe together with an agreement that regulation will be adopted if the target is not met ndash is also unlikely to be successful

76 Option 5 - Regulation

Regulation which requires a clear acknowledgement of a sufficient problem by Government places uniform mandatory compliance obligations on industry The costs associated with regulations are usually shared between government and industry with the development of regulations and program administration costs being borne by government with industry meeting compliance costs including emissions testing and if applicable labelling costs

It could argued that regulation should be introduced in the States or Territories where there are exceedances of the Air NEPM ozone standards However development of state based regulations for garden equipment engines emissions is unlikely as they would be incompatible with the 1992 Intergovernmental Agreement on the

40

Environment signed by the Commonwealth States and Territories and existing Commonwealth and State Government mutual recognition legislation The Intergovernmental Agreement on the Environment which underpins the development of National Environment Protection Measures obligates all jurisdictions to ensure equivalent protection from air pollution to all Australians

In addition enforcement of any state based legislation would be a key problem Under the Commonwealth Mutual Recognition Act 1992 and the Trans-Tasman Mutual Recognition Act 1997 goods that are imported into or produced in an Australian State or Territory or New Zealand that can be sold lawfully in that jurisdiction can be sold freely in a second jurisdiction even if the goods do not comply with the regulatory standards of the second jurisdiction This means non-regulated small engine products legally sold in one State could be legally sold in any other state regardless of whether emissions limits on small engines applied in that State

National regulation on the other hand would provide national consistency It would also provide the opportunity to adopt worldrsquos best practice standards and incorporate penalties for non-complying parties

Under the Australian Constitution the Commonwealth does not possess specific legislative powers in relation to the environment and heritage There are however a number of legislative powers that can support environment and heritage legislation Furthermore Commonwealth legislative powers can be used cumulatively For example the Commonwealth Parliament can make laws under section 51(20) of the Constitution with respect to ldquoforeign corporations and trading or financial corporations formed within the limits of the Commonwealthrdquo

Legislative mechanisms may also be created through the development of a National Environment Protection Measure (NEPM) that then becomes law within each jurisdiction A NEPM can accommodate flexibility of implementation where jurisdictions that have elevated ozone levels can tailor their NEPM program to their specific air quality needs An example of this flexible approach is the Diesel NEPM which has a suite of programs which can be implemented by jurisdictions

From the review of Australian regulations to reduce the environmental impacts of products and the overseas approaches to control emissions from small engines two regulatory approaches become apparent a simple benchmark or tiered benchmarks These are outlined below

Regulatory Option1 - A Simple Benchmark Approach

The most basic regulatory approach that could be taken would be to have a single emission standard (or as per the USA Europe and California a number of emission standards based on power and application) for combined HC + NOx emissions All equipment with new engines sold in Australia from the date the regulations are introduced This approach would

bull remove the all high emission engines from sale

41

bull be supported by an Australian Standard and

bull provide consumers with confidence that all products meet certain emissions standard

Regulatory Option 2 -Tiered Benchmarks

Current Australian directions to reduce the environmental impact of consumer products favour tiered benchmarks using a lsquostarrsquo rating system (see Appendix 2 for examples)

For engines used in garden equipment a tiered emissions labelling system could be based on the USEPA Phase 1 and Phase 2 standards use a system of lsquostarsrsquo to provide information to consumers about environmental performance but not limit consumer choice A tiered lsquostarrsquo system approach would

bull reward those products with more stars that meet the more stringent overseas standards

bull either operate with minimum emissions performance standards or disendorsement labels

bull be supported by a product label and possibly a web database

bull provide consumers emissions information and the option to purchase a lower emission engine

bull be supported by an Australian Standard and

bull be devised to meet worldrsquos best practice which is an overarching approach supported by Government

Table 16 summarises the main strengths and weaknesses of the above options

42

Table 16 Main Strengths and Weaknesses of Each Option

Strengths Weaknesses

Do Nothing Does not limit consumer choice Emissions contribution likely to grow No cost to government No barrier to new market entrants selling

high emitters Consumers have a wide choice of products Industry unchecked amp product dumping

likely No enforcement recourse on environmental grounds available

Partnerships Some sharing of responsibility government Slow if any reduction in high emitters

ndash industry

Potential for Government assist in Few if any companies likely to join and no advancing reductions in high emitters restrictions on non signatories Reduction targets set Below worldrsquos best practice

Quasi Regulation Similar strengths to partnership option Similar weaknesses to partnership option as

few if any companies likely to adopt code of practice

Co-Regulation Ongoing consultation between industry and Due to industry diversity targets unlikely to government recourse to regulation be met Targets set and can require new market Slow reduction in emissions entrants to achieve targets Can have implementation flexibility Emissions test standard adopted

Regulation Option 1- Simple Benchmark Worldrsquos best practice standards can be ovide incentives to manufacturers to promote low adapted and is mandatory emitters

Recourse to legal action available for non Does not provide consumers with emissions compliance information Significant quantifiable health benefits Cost of enforcement borne by taxpayers Requires compliance by all industry and High cost to government bans high emitters

Regulation Option 2 ndash Tiered Benchmarks Provides consumers with emissions information but does not limit choice Incentives for manufacturers to sell low emitters Potentially significant quantifiable health benefits Can be designed to overcome ABT issue

Significant administration and compliance costs to Government High cost to government and industry and will increase retail price of engines Does not ban high emitters

43

77 Preferred Approach

From the above discussion and from the review of garden equipment on available to the Australian consumer there are many companies selling powered garden equipment on the Australian market and the market is very competitive Furthermore from the Expert Panel discussions and stakeholder consultation it is apparent that it is highly unlikely that all the companies in the garden equipment industry would engage in or commit to a voluntary program to reduce their productsrsquo exhaust emissions It is therefore clear that the only feasible path to reduce emissions from these small engines is through regulation

While regulations of emissions from small engines used in garden equipment in Australia are likely to be based on overseas regulations they need to strike a balance between improved environmental outcome harmonisation with international standards and the characteristics of the local industry With regulation optimum emissions reductions are achievable especially by combining minimum emissions standards with tiered product labelling Whether this approach is justifiable on economic grounds that is the benefits outweigh the costs can only be determined through a detailed impact assessment Based on these findings it is recommended that a formal assessment of the costs and benefits of nationally regulating 2 and 4 stroke lawn mowers and handheld power equipment should now be commenced

44

References Air Resources Board California Environmental Protection Agency Californian Exhaust Emission Standards and Test Procedures for 2005 and Later Small Off-road Engines July 26 2004

Artcraft 2003 A Major Research-Based Review and Scoping of Future Directions for Appliance Efficiency Labels in Australia and NZ prepared for the Australian Greenhouse Office viewed at wwwenergyratinggovaulibraryindexhtml

Australian Bureau of Statistics 1999 Older People Australia A Social Report Report Number 41090 December 1999

Australian Greenhouse Office 2002 Achievements 2002 National Appliance equipment energy efficiency program Commonwealth of Australia

Australian Greenhouse Office 2002 Achievements 2002 National Appliance equipment energy efficiency program Commonwealth of Australia

AustralianNew Zealand StandardtradeASNZS 64002005 Water efficient productsmdashRating and labeling Federal Register of Legislative Instruments F2005L01571

Bei L T and Widdows R1999 Product knowledge and product involvement as moderators of the effects of information on purchase decisions a case study using the perfect information frontier approach Journal of Consumer Affairs 33(1) 165-186

Buy Recycled Busines Alliance Briefing Paper Environmental Claims And Labelling Abstract lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10-2003

California Code of Regulations 1998 Final Regulation Order Article 1 and Article 3 Chapter 9 Division 3 Title 13 Attachment 1 26 March 1998 wwwarbcagovregactsoreregs_finpdf

Canada Gazette Part II Vol 137 No 24 2003-11-19

Canadian Gazette 29 March 2003 Vol 137 No 13 Part 1 pp 935- 955

Cap Gemini Ernst amp Young (2001) Cars Online 2001 Global consumer survey httpa593gakamainet75931951a8b278a28319eawwwcgeycomhightechautomediaC ars_online2pdf

Clothes Washers Australiarsquos Standby Power Strategy 2002 ndash 2012 Standby Product Profile 200308 October 2003 wwwenergyratinggovau

Craig ndash Lees M Joy Sally Browne B 1995 Consumer Behaviour John Wiley amp Sons Queensland 1995

Department of Environment and Conservation NSW 2004 Measures to Encourage the Supply and Uptake of Cleaner Lawnmowers and Outdoor Handheld Equipment

45

Department of Environment and Conservation 2003 Who cares about the environment in 2003 A survey of NSW peoplersquos environmental knowledge attitudes and behaviours DEC Social Research Series

Department of Environment and Conservation Action for Air update 2006

Department of Environment and Conservation The Buy Recycled Guide Online Directory viewed at wwwresourcenswgovauindex-RNSWhtm

EcoRecycle 2004 Paint Take-Back Takes Off in Bayswater Media release 24 March 2004 viewed at wwwecorecyclevicgovau May 2004

Enviromower viewed at wwwenviromowercomau June 2004

Environment Canada 2000 Future Canadian Emission Standards for Vehicles and Engines and Standards for Reformulation of Petroleum Based Fuels Discussion Paper in Advance Notice of Intent by the Federal Minister of the Environment April 2000 wwwecgccaenergfuelsreportsfuture_fuelsfuture_fuels1_ehtm

Environment Canada 2004 Environment Minister Urges Canadians to Reduce Greenhouse Gas Emissions and Mow Down Pollution With Unique Incentive Program Media Release April 23 2004 viewed at wwwecgccamediaroomnewsrelease May 2004

Environment Protection and Heritage Council National Environment Protection (Ambient Air Quality) Measure Report on the Preliminary Work for the Review of the Ozone Standard October 2005

Environment Protection Authority 2006 Victoriarsquos Air Quality ndash 2005 Publication 1044 June 2006 wwwepavicgovau

Environmental Choice NZ 2001 Public Good and Environmental Labelling An Internal Background Paper

European Commission Directive 200344EC amending the recreational craft directive and comments to the directive combined 211005

George Wilkenfeld and Associates Pty Ltd with Artcraft Research and Energy Efficient Strategies Tomorrow Today 2003 Final Report A Mandatory Water Efficiency Labelling Scheme for Australia Prepared for Environment Australia June 2003

George Wilkenfeld and Associates 2003 A National Strategy for Consumer Product Resource Labelling in Australia prepared for the Australian Greenhouse Office December 2003 viewed at wwwenergyratinggovaulibraryindexhtml

Green Vehicle Guide wwwgreenvehicleguidegovau

Harrington L and Holt S 2002 Matching Worldrsquos Best Regulated Efficiency Standards ndash Australiarsquos success in adopting new refrigerator MEPS wwwenergyratinggovaulibrarypubsaceee-2002apdf

46

Harris J and Cole A 2003 The role for government in ecolabelling ndash on the scenes or behind the scenes lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10-2003

Holt S and Harrington L2003 Lessons learnt from Australiarsquos standards and labeling program Paper presented at ECEEE Summer Study - 2-6 June 2003 wwwenergyratinggovaulibraryindexhtml

IBIS 2006a Domestic Hardware Retailing 09-Jun-2006 Industry Code G523b

IBIS 2006b Gardening Services 18-Jan-2006 Industry Code Q9525

IBIS 2003 Gardening Services in Australia 23 December 2003 Industry Code Q9525

Lawrence K Zeise K amp Morgan P 2005 Management Options for Non-Road Engine Emissions in Urban Areas Consultancy report for Department for Environment amp Heritage Canberra

Motor Vehicle Environment Committee (MVEC) in consultation with the Department of Transport and Regional Services 2002 Proposal for an Australian ldquoGreen Vehiclesrdquo Guide viewed at httpwwwdotarsgovaumvegreen_vehicles_guidedoc May 2004

National Appliance and Equipment Energy Efficiency Committee The Energy Label at wwwenergyratinggovau (3504)

National Environment Protection Council 2005 National Environment Protection (Ambient Air Quality) Measure Report on the Preliminary Work for the Review of the Ozone Standard October 2005

National Environment Protection Council 1998 Final Impact Assessment for Ambient Air Quality National Environment Protection Measure June 1998

National Environment Protection Council 1999 Used Packaging Materials Impact Statement for the Draft NEPM Used Packaging Material January 1999 viewed at wwwephcgovau

National Environment Protection Council 2004 National Environment Protection (Air Toxics) Measure April 2004 viewed at wwwephcgovau

New South Wales Government 2002 Protection of the Environment Operations (Clean Air) Regulation 2002

New South Wales Government 1999 NSW Government Procurement Policy Statement White Paper 1999

Nordic Council 2002 Ecolabelling of marine Engines Criteria Document 8 December 1995 ndash 6 December 2005 version 35 December 2002

47

Office of Public Sector Information Statutory Instrument 2004 No 2034 The Non-Road Mobile Machinery (Emission of Gaseous and Particulate Pollutants) (Amendment) Regulations 2004 wwwopsigovuksisi200420042034htm

Outdoor Power Equipment Institute 2001 Profile of the Outdoor Power Equipment Industry wwwopeiorg

Productivity Commission 2004 The Private Cost Effectiveness of Improving Energy Efficiency Final report October 2005 wwwpcgovauinquiryenergy

Publishers National Environment Bureau Media Release lsquoAustralia leads the world in newspaper recyclingrsquo 6 June 2006 wwwpnebcomau

Real J Jones A 2005 The Green Vehicle Guide Clean Air Soceity of Australia and New Zealand Conference 2005 Hobart

Salmon G Voluntary Sustainability Standards and Labels (VSSLs) The Case for Fostering Them OECD Round Table On Sustainable Development

Schkade D A and Kelinmutz D N 1994 Information displays and choice processes differential effects of organization form and sequence Organizational Behavior and Human Decision Processes 57(3) 319-337

Stephens A 2003 Eco Buy (Local Government Buy Recycled Alliance Victoria) Abstract lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10shy2003

Teisl M F Roe B and Hicks RL 2002 Can eco-labels fine tune a market Evidence from dolphin-safe labeling Journal of Environmental Economics and Management 43339-359

Teisl M F Roe B and Levy A S Ecolabelling What does consumer science tell us about which strategies work pp141-150

The ISO 14000 family of standards guides and technical reports

The Parliament of the Commonwealth of Australia 2004 House of Representatives Water Efficiency Labelling and Standards Bill 2004 Explanatory Memorandum wwwcomlawgovauComLawLegislationBills1nsf viewed February 2006

Thogerson J 2000 Promoting green consumer behaviour with eco-labels Workshop on Education Information and Voluntary Measures in Environmental Protection National Academy of Sciences ndashNational Research Council Washington DC November 29-30

United States Environmental Protection Agency Federal Register Vol 60 No 127 3 July 1995 Control of Air Pollution Emission Standards for New Nonroad Spark-ignition Engines At or Below 19 Kilowatts wwwepagovEPA-AIR1995JulyDay-03prshy805txthtml

48

United States Environmental Protection Agency Federal Register Vol 69 No 7 12 January 2004 Rules and Regulations 40 CFR Part 90 Amendments to the Phase 2 Requirements for Spark-Ignition Nonroad Engines at or Below 19 Kilowatts Direct Final Rule and Proposed Rule wwwepagovfedrgstrEPA-AIR2004JanuaryDay-12a458pdf

United States Environmental Protection Agency Office of Pollution Prevention and Toxics Pollution Prevention Division 1998 Ecolabelling Environmental Labelling - A Comprehensive Review of Issues Policies and Practices Worldwide

United States Environmental Protection Agency Office of Transportation and Air Quality March 2000 Regulatory Announcement Final Phase 2 Standards for Spark-Ignition Handheld Engines

United States Environmental Protection Agency 1998 Proposed Phase 2 Emission Standards for Small SI Engines 27 January 1998

United States Environmental Protection Agency 2000 Regulatory announcement Final Phase 2 Standards for Small Spark-Ignition Handheld Engines March 2000 EPA420-F-00shy007

United States Federal Register Vol 69 No 7 Monday January 12 2004 Rules and Regulations Environmental Protection Agency 40 CFR Part 90 Amendments to the Phase 2 Requirements for Spark-Ignition Nonroad Engines at or Below 19 Kilowatts Direct Final Rule and Proposed Rule United States Federal Register Vol 64 No 60 30 March 1999 40 CFR Part 90 Phase 2 Emission Standards for New Nonroad Spark-Ignition Nonhandheld Engines At or Below 19 Kilowatts Final Rule pp15214-15216

United States Federal Register Vol 65 No 80 25 April 2000 40 CFR Parts 90 and 91 Phase 2 Emission Standards for New Nonroad Spark-Ignition Handheld Engines at or Below 19 Kilowatts and Minor Amendments to Emission Requirements Applicable to Small Spark-Ignition Engines and Marine Spark-Ignition Engines Final Rule pp24282-24284

United States Environmental Protection Agency Control of Air Pollution Emission for New Nonroad Spark-ignition Engines At or Below 19 Kilowatts Final Rule 40 CFR Parts 9 and 90 1995 wwwepagovEPA-AIR1995JulyDay-03pr-805txthtml

United States Environmental Protection Agency Office of Pollution Prevention and Toxics Pollution Prevention Division 1998 Ecolabelling Environmental Labeling- A Comprehensive Review of Issues Policies and Practices Worldwide

Victorian Government Greenhouse Strategy Community Action Fund - Mow Down Lawn Mower Rebate Exchange Program wwwgreenhousevicgovaucommunitygrantscafsuccessfulprojectshtm

Water Efficiency Labelling and Standards Act 2005 No 4 wwwcomlawgovauComLawLegislation

49

Water Efficiency Labelling and Standards Determination 2005 wwwcomlawgovauComLawLegislationLegislativeInstrument1nsf

Water Efficiency Labelling and Standards Regulations 2005 wwwcomlawgovauComLawLegislationLegislativeInstrument1nsf

Wilkie W 1994 Consumer Behaviour John Wiley and Sons NY as cited in Craig ndash Lees M Joy Sally Browne B 1995 Consumer Behaviour John Wiley amp Sons Queensland 1995

wwwenergyratinggovau

wwwgreenvehicleguidegovau

wwwwaterratinggovau

50

Appendix 1 Detailed Breakdown of Powered Garden Equipment on the Australian Market

The following table gives a profile of the current equipment on the Australian market It is based mostly on distributor responses to a survey and might not be representative of the total market

Low sales indicates that no sales data was available but volumes are likely to be small compared with popular equipment Phase 1 is US EPA Phase 1 or EU Directive 200288EU Phase 2 is US EPA Phase 2 or Euro standards

Type Ranges Stroke Aerator 5 makes 6 models Sales Low

Engine power 26 to 172kW Engine displ 143-674 ml

2c -4c 5 Unspecified 1 Phase 1 - Phase 2 4

Auger 3 makes 5 models Sales Low

Engine power 12 to 16kW Engine displ 31-ml

2c 5 4c -Unspecified -Phase 1 1 Phase 2 1

Backhoe 0 makes 0 model Sales Low

(2 models in 2003) -

Blower 13 makes 49 models Sales 109K

Engine power 07 to 31kW Engine displ 24-80ml

2c 34 4c 2 Unspecified 13 Phase 1 10 Phase 2 17

Blower-wheeler 3 makes 6 models

Engine power 07 to97kW Engine displ 24-305ml

2c 1 4c 4 Unspecified 1 Phase 1 3 Phase 2 -

Blowervac 6 makes 9 models Sales

Engine power 07 to 11kW Engine displ 24-34ml

2c 6 4c -Unspecified 3 Phase 1- Phase 2 3

Brush cutter 12 makes 95 models Sales 339K

Engine power 06 to 23kW Engine displ 21-54ml

2c 66 4c 5 Unspecified 24 Phase 1 15 Phase 2 34

Chainsaw 9 makes 106 models Sales 152K

Engine power 1 to 58kW Engine displ 26-122ml

2c 74 4c -Unspecified 32 Phase 1 18 Phase 2 27

Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

51

Type Ranges Stroke Clearing saw Engine power 14 to 27kW 2c 6 3 makes Engine displ 36-57ml 4c 0 9 models Unspecified 3 Sales low Phase 1 4 Phase 2 -Cultivator Engine power 07 to 52kW 2c 2 4 makes Engine displ 25-190ml 4c 5 7 models Unspecified -Sales low Phase 1 - Phase 2 5 De-thatcher Engine power 1kW 2c 1 1 makes Engine displ 27ml 4c -1 models Unspecified -Sales low Phase 1 - Phase 2 1 Drill Engine power 1kW 2c 3 3 makes Engine displ 27ml 4c -4 models Unspecified 1 Sales low Phase 1 - Phase 2 1 Edger Engine power 1 to 4kW 2c 12 10 makes Engine displ 24-190ml 4c 11 36 models Unspecified 1 Sales Phase 1 3 Phase 2 22 Garden tractor Engine power 12 to 157kW 2c -2 makes Engine displ 465 to 675ml 4c 5 12 models Unspecified 9 Sales low Phase 1 - Phase 2 3 Grass trimmer Engine power- 2c 3 1 make Engine displ 31ml 4c -3 model Unspecified -Sales Phase 1 - Phase 2 3 Hedge trimmer Engine power 06 to 1kW 2c 28 10 makes Engine displ 21-31ml 4c 1 42 models Unspecified 13 Sales 40K Phase 1 4 Phase 2 35 Lawnmower Engine power 26 to 66kW 2c 22 19 makes Engine displ 100-270ml 4c 151 183 models Price $449-$3609 Unspecified 10 Sales 424K Phase 1 95 Phase 2 48 Line trimmer Engine power 07 to 45kW 2c 25 8 makes Engine displ 24-195ml 4c 2 29 models Price $136-$299 Unspecified 2 Sales Phase 1 2 Phase 2 6 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

52

Type Ranges Stroke Log splitter Engine power 26 to 45kW 2c -1 makes Engine displ 100-195ml 4c 2 2 models Unspecified -Sales low Phase 1 - Phase 2 1 Multicutter Engine power 08 to 14kW 2c 17 5 makes Engine displ 23-36ml 4c 1 19 model Unspecified 1 Sales Phase 1 2 Phase 2 13 Olive nut shaker Engine power - 2c -1 make Engine displ - 4c -1 model Unspecified 1

Phase 1 - Phase 2 -Pole saw Engine power 08 to 14kW 2c 6 4 makes Engine displ 23-36ml 4c -10 models Unspecified 4 Sales low Phase 1 1 Phase 2 3 Power carrier Engine power 37 to 231kW 2c -2 makes Engine displ 160 to 953ml 4c 11 11 models Unspecified -Sales low Phase 1 - Phase 2 10 Power cutter Engine power 32 to 45kW 2c 5 2 makes Engine displ 64-99ml 4c -8 models Unspecified 3 Sales low Phase 1 1 Phase 2 3 Pruner (3 models in 2003) 2c -0 make 4c -0 models Unspecified -Sales low Ride-on-mower Engine power 26 to 231kW 2c -12 makes Engine displ 100 to 725ml 4c 93 124 models Unspecified81 Sales 51K Ph1 1 Ph2106 Rotary hoe (4 models in 2003) 2c -0 makes 4c -0 models Unspecified -Sales low Shredder Engine power 3 to 96kW 2c 1 6 makes Engine displ 126-389ml 4c 16 20 models Unspecified 3 Sales 46K Phase 1 - Phase 2 4 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

53

Type Ranges Stroke Stump grinder Engine power 96kW 2c -1 make Engine displ 389ml 4c 1 1 model Unspecified -Sales low Phase 1 - Phase 2 1 Tiller Engine power 08 to 59kW 2c -3 makes Engine displ 25-243ml 4c 8 9 models Unspecified 1 Sales low Phase 1 - Phase 2 7 Trencher Engine power37kW 2c -1 makes Engine displ 183ml 4c -1 models Unspecified 1 Sales low Phase 1 - Phase 2 1 Trimmer Engine power - 2c 10 2 makes Engine displ - 4c -21 models Price - Unspecified 11 Sales Phase 1 4 Phase 2 -Turfcutter Engine power 37kW 2c -1 makes Engine displ - 4c 1 1 models Unspecified -Sales low Phase 1 - Phase 2 -Vac Engine power 22 to 172kW 2c 1 5 makes Engine displ 158 to 674ml 4c 13 15 models Unspecified 1 Sales Ph11 Ph24 Vac chipper Engine power 34 to 45kW 2c -2 makes Engine displ 158-195ml 4c 3 3 models Unspecified -Sales low Phase 1 - Phase 2 1 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

54

Appendix 2 Examples of Current Australian Benchmarking Programs

The following describes in varying degrees of detail a number of current Australian benchmarking schemes classified by program type simple bench mark approaches tiered benchmarks and government industry partnerships This appendix concludes with a summary table of these programs with an assessment of their effectiveness

1 Introduction

Simple benchmark schemes (described below) such as the woodheater standards set a single point hurdle rate whereas the green vehicle guide use tiered benchmarks The new water efficiency labelling scheme and minimum energy efficiency performance standards uses both a simple benchmark through minimum performance requirement plus tiered benchmarks incorporated into labels as lsquostarsrsquo Other approaches such as the stand-by power program and the Victorian Altona Complex VOC reduction target set goals for achievement within a specified time period Other approaches taken to reduce environmental impacts include the National Packaging Covenant which uses a program based on individual companies developing tailored approaches to suit their circumstances and is supported by enforcement capability through the National Environment Protection (Used Packaging Materials) Measure (the NEPM)

2 Simple Benchmarks

21 Minimum Energy Performance Standards (MEPS)

Purpose

MEPS prescribe a minimum allowed energy performance for specific appliances Appliances that are less efficient than the relevant standard are excluded from the market

Background and Strategy

In October 1999 as part of the National Greenhouse Strategy (1998) nationally consistent MEPS and labelling schemes were adopted across Australia

Independent NATA accredited laboratories undertake product compliance checks to see whether products perform in compliance with MEPS requirements For example

bull In 2003 the government conducted check tests on eight appliance models all of which were found not to meet the claims made on the energy performance labels Two products were deregistered one was found to have not been registered and action was pending on the remaining five products (AGO 2003b)

55

bull Other regulatory actions undertaken in 2003 included fines of $3000 and $8000 against two Western Australian retailers who were found to have sold appliances without energy performance labels Queensland and Victorian retailers received infringement notices and fines totalling $10 000 (AGO 2003b)

Summary RegulNated minimum performance standards based on an Australian Standard

22 Energy Star

Purpose

An endorsement label that indicates an electronic product has achieved a specified standard when it is not performing its core function (ie on stand by)

Background and Strategy

Energy Star is a voluntary endorsement labelling program developed by the US Environmental Protection Agency (US EPA) It has been operating in the USA since 1992 and has been adopted by a number of countries including Australia Energy Star sets voluntary standards for reducing the electricity consumption of electronic equipment when it is not performing its core function

The Government stand ndash by program which is outlined below complements the energy star labelling program

Summary Voluntary endorsement label

23 Woodheater Standards

Purpose

To reduce particle emissions through Australian Standard compliant woodheaters

Background and Strategy

Since 1992 Australian StandardNew Zealand Standards have been introduced to improve the performance of wood heaters

The first standard for wood heater emissions AS4013 (1992) was published in 1992 and was revised and published as a joint AustralianNew Zealand Standard in 1999 ASNZS4013 (1999) Domestic solid fuel burning appliances - Method for determination of flue gas emission This Standard provides a test method to measure particles emitted by residential solid-fuel burning heating appliances

56

The 1992 Standard included an upper limit for acceptable particle emissions of 55 grams of particles per kilogram (oven-dry weight) of fuel burnt This emission factor was reduced to 4 gkg in the 1999 revision of the Standard The Standard applies to solid-fuel burning space-heating appliances (including those fitted with water heating devices) with a heat output of 25KW or less It does not apply to masonry fireplaces cooking stoves central heating appliances or water-heating-only appliances

AS 4013 (1999) is complemented by ASNZS4014 (1999) Domestic solid fuel burning appliances - Test Fuels and ASNZS4012 (1999) Domestic solid fuel burning appliances - Method for determination of power output and efficiency

The woodheater industry was instrumental in initiating the development of standards and it lobbied states and territories to enact legislation to mandating that woodheaters be required to meet the standards As the health affects of particle pollution have become more apparent and as some jurisdictions are having difficulty in meeting national particle standards Government has become more proactive in controlling woodheaters and more supportive of tighter standards

All states and territories with the exception of South Australia have regulations that restrict emissions from new woodheaters although Victoria for example only introduced its regulations in 2004 compared to Tasmania who introduced regulations in 1993 These regulations require that new woodheaters comply with the Australian Standard ASNZS 4013 The State regulations however are not uniform

Many woodheaters that are currently certified for sale do not comply with the revised standard as verified in a National Woodheater Audit Program undertaken in 2004 Seven of the 12 wood heaters tested failed to meet the ASNZS 4013 particle emission limit In addition 55 of heaters were found to have deviations from the original designs and 72 had labelling faults that could adversely affect emissions performance

Testing and certification are administered by the industry association

Summary State and regulations requiring compliance with Australian Standards Certification administered by industry association

24 Standby Power

Purpose

To reduce lsquoexcessiversquo energy consumed in electrical appliance standby mode sold in Australia through in the first instance voluntary targets Appliances covered by the program range from information technology equipment such as PCs and photocopiers entertainment equipment such as TVs DVDs and sound systems major appliances such as water heaters dishwashers and refrigerators and small appliances such as smoke detectors and bread makers

57

Background and Strategy

In 2000 standby power was estimated to constitute 116 per cent of Australiarsquos residential energy use costing households over $500 million and leading to the emission of over 5 million tonnes of carbon dioxide equivalent (AGO 2002c) Holt and Harrington (2004) estimated that standby power consumption in Australia could be reduced by 56 per cent by 2020 (Productivity Commission 2005)

In August 2000 all Australian jurisdictions agreed to pursue efficiencies in standby power consumption of energy-consuming products through support for the International Energy Agencys One -Watt program and endorse its incorporation into theprogram of work

Australia reportedly has taken the lead on implementing the One- Watt program even though many of the products sold in Australia are imported

During 2002 government agencies consulted with stakeholders about ideas to reduce standby The standby strategy which proposed a list of targeted potential product types was presented to the Ministerial Council on Energy

In September 2003 an interim test method for the measurement of standby power ASNZS 62301-2003 (int) based on an internationally recognised standard was published Also during this period work commenced on developing draft product profiles for high priority targeted products

Once product profiles are completed interim voluntary date-specific targets are made The product sales are then monitored to determine progress towards the interim target If it is then determined that inadequate progress is being achieved by a significant number of suppliers then government will regulate

For example the interim 2007 target for clothes washers is as follows

Product Off mode power End of program mode

lt 1W lt 4 W

The National Standby Strategy Target to be achieved by 2012 for clothes washers is as follows

Off mode power End of program mode lt 03 W lt 1 W

In support of the clothes washer program Government will

bull consider creating a Government Purchasing Policy to buy low standby clothes washers where available and fit for purpose

bull collect data on all modes for new clothes washers and analyse trends

bull highlight the range of performances by publishing performance data on clothes washers on a website or by other means

58

bull progressively include standby energy consumption into the Comparative Energy Consumption for labelled products such as clothes washers and clothes dryers

bull work with the Standards Committees to finalise the details of modes and test methods for the relevant standards

bull determine in 2008 if progress is inadequate and if regulation is required

Summary Industry targets possible future regulation

3 Tiered Benchmarks

31 Mandatory Energy Efficiency Label ndash the Energy Star Programs

Purpose

To enable consumers to easily compare the energy performance of electrical appliances used by households and firms through a labelling scheme

Background and Strategy

Several Australian states commenced mandatory energy efficiency labelling for major appliances in the mid-1980s In 1992 it became mandatory across Australia for initially refrigerators and later freezers clothes washers clothes dryers dishwashers and air-conditioners (single phase only) to carry the label when they are offered for sale This labelling program is regarded as one of the most successful in the world (Wilkenfeld and Assoc 2003) It is administered through the Australian Greenhouse Office

The energy rating label for dishwashers

(ldquoa joint government and industry programrdquo) and a website address (wwwenergyratinggovau) and has two main features

bull the star rating which gives a quick comparative assessment of the models energy efficiency and

bull the comparative energy consumption (usually kilowatt hoursyear) which provides an estimate of the annual energy consumption of the appliance based on the tested energy consumption and information about the typical use of the appliance in the home These values are measured under Australian Standards which define test procedures for measuring energy consumption and minimum energy performance criteria Appliances must meet these criteria before they can be granted an Energy Rating Label

The Energy Rating Label includes an endorsement

59

Awards Brand ModelInstallat

ionType

Phase Available

10 Yr Energy

Cost StarRating

Output(kW)

TOSHIBA

Digital Inverter Series Air

Conditioner RAV-SM1102BT-

ERAV-SP1102AT-E (

RAV-SM1102BT-ERAV-

SP1102AT-E)

SingleSplit

SystemDucted

Single $1500 1000

CHUNLAN

KFR-32GWVWa (

NO)

SingleSplit

SystemDucted

Single $645 323

Since its introduction the star rating label seems to have established a high level of recognition with consumers Consumer research (Artcraft 2003) indicates that the different information on the label appeals to different consumer segments interested in purchasing an appliance

When a manufacturer gains approval to use the label they pay for and produce the label in accordance with specifications on size colours fonts layout and design A similar colour scheme and design to the energy consumption label is also used for the compulsory fuel consumption label on new passenger and light commercial vehicles

The labelling scheme is underpinned by regulation whereby regulated Minimum Energy Performance Standards (MEPS) provide the environmental benchmarks that the appliances are required to meet Appliances that do not meet the minimum energy performance standards can be withdrawn from the Australian market

When the energy rating program was reviewed in 2000 technology had advanced to the point where a large percentage of appliances had achieved the maximum number of stars so the rating system was tightened It is estimated that over the 25 year period 1980 to 2005 there will have been an overall reduction in energy consumption of around 70 by the most popular sized refrigerators (with freezers) (Harrington L and Holt S 2002)

In addition to the energy consumption label there is a website (wwwenergyratinggovau) with a comprehensive database of all appliances their star rating and energy consumption In 2002 there were around 220000 hits on the programrsquos various websites and 523000 in 2003 reportedly representing 80000 visits by individual inquirers The website hit rate is estimated to represent almost 10 of consumers who are considering purchasing an appliance (Holt et al 2003)

Cooling

Energy Input (kW)

250

104

Figure B Excerpt from Energy Rating web page for Air Conditioners (cooling cycle only shown)

When the energy rating program was reviewed in 2000 technology had advanced to the point where the Scheme had to be tightened because a large percentage of appliances had achieved the maximum number of stars For example energy use by refrigerators was around 70 compared to that used when the scheme started (Harrington L and Holt S 2002)

60

Regulations

State and Territory legislation refer to the relevant Australian Standards This approach simplifies the State and Territory legislation and makes it relatively straightforward to maintain national consistency of appliance and equipment energy efficiency standards even when standards are continually being revised

The testing procedures and technical requirements for the label and also Minimum Energy Performance Standards (MEPS see below) are incorporated into the applicable Australian Standards Products for sale must be registered with one of the State regulators

Program Administration

The labelling program and MEPS program are administered by the National Appliance and Equipment Energy Efficiency Committee (NAEEEC) which is ultimately directed by the Ministerial Council on Energy

Requirements for Appliance Suppliers

Appliance suppliers are required to

bull Submit applications for product registration and these must include a test report or other data to demonstrate that the appliance meets the relevant Australian Standard

bull While test reports on three separate units are required for most products there is no particular requirement for test laboratories to be accredited or products certified for registration for energy labelling and MEPS in Australia Test reports from the manufacturers laboratory are satisfactory However if there is evidence that results from a particular laboratory are unsatisfactory regulators can mandate test reports from an accredited laboratory

Summary Mandatory labelling scheme backed by regulations and an Australian Standard

32 Water Appliances Water Efficiency Labelling and Standards (WELS) Scheme

Purpose

A labelling scheme backed by legislation to promote domestic water efficient appliances

Background and Strategy

A voluntary water efficiency industry administered labelling scheme has been in existence since 1988 The water efficiency ratings and details on the label design are covered in ASNZS 6400 The main incentive of the voluntary lsquoAAAAArsquo scheme

61

has been the publicity and cash rebates offered by water utilities However the coverage water efficiency performance requirements and impact of this program have been limited

In 2003 the Environment and Heritage Ministers agreed to implement a national Water Efficiency Labelling Scheme (WELS) for products such as shower heads washing machines dishwashers and toilets Consultation with industry and stakeholders was undertaken in 2003 with a strategic study published that identified the products to be included in the new labelling Scheme A Regulation Impact Statement (RIS) which identified the costs and benefits of various options and made various recommendations was published in March 2004 Following public review of the RIS some modifications were made to WELS

The WELS Scheme is backed by the following legislation and standard

Water Efficiency Labelling and Standards Act 2005 which establishes

bull the products subject to the Scheme and the requirements for registration and labelling

bull the standards to apply to WELS products setting requirements for water efficiency performance registration and labelling of these products

bull enforcement provisions including penalties bull the appointment of inspectors to investigate possible contraventions and sets

out their powers and obligations bull review and dispute resolution bull a program Regulator bull the making of regulations bull a requirement for annual reports and for an independent review after five years

Water Efficiency Labelling and Standards Regulations 2005 which

bull prescribes the circumstances in which a person other than the manufacturer of a WELS product may be taken to be the manufacturer of the product (eg an importer)

bull sets out procedures for the issuing and the payment of penalty infringement notices as an alternative to prosecution for offences against the WELS Act

bull specifying the information to be included on an identity card issued to a WELS inspector

Water Efficiency Labelling and Standards Determination 2005 amongst other things determines and establishes product registration fees and calls up the Australian Standard ASNZS6400 2005 Water-efficient products - Rating and labelling which

bull defines the products

bull specifies the assessment procedures (ie identifies test procedures in other Australian Standards)

bull provides the formulas to give products their star rating

bull specifies the labels and their application to products

62

Approximately twenty organisations were represented on the Standards Committee that developed the Standard

State and Territory legislation

The States and Territories have also enacted or agreed to enact complementary legislation to ensure that the WELS Scheme has comprehensive national coverage State and Territory legislation which is almost a mirror of the Commonwealthrsquos Water Efficiency Labelling and Standards Act 2005 enables the States and Territories to for example undertake certain responsibilities delegated to them by the Commonwealth Regulator appoint their own inspectors and enforce the WELS

Other features of WELS include

bull A product web database

bull With the exception of toilets no other products are required to meet mandatory water efficiency requirements (WES) but this may change over time The introduction of mandatory WES means that products not meeting the minimum performance requirements can not legally be sold

bull Products must be tested in accordance with the relevant Standard and must meet any minimum performance and water efficiency requirements in the Standard before they can be granted a WELS Water Rating label

bull It is up to manufacturers or their agents (eg importers in the case of imported products) to ensure that their products are correctly registered and labelled and comply with any other requirements of the Standard

There is a transition phase which gives manufacturers and importers time to test register and label products and to sell pre-existing stock From 1 January 2008 all products are required to display the WELS Water Rating labels irrespective of their date of supply

63

The WELS Water Rating label

Label Features

bull A star rating for a quick comparative assessment of the models water efficiency

bull Labels with 1 to 6 stars

bull Some products may also be labelled with a Zero Star Rated label which indicates that the product is either not water efficient or does not meet basic performance requirements

bull A productrsquos water consumption figure

bull There are provisions for swing tags if there is inadequate surface area for label or the item is likely to be marked by sticking the label on the product

Summary Mandated product labelling using lsquostarrsquo rating system Has a disendorsement label and has provisions to ban products

33 Gas Appliance Rating Scheme

Purpose

A gas labelling program to improve the energy efficiency of gas powered products

Background and Strategy

The Gas and Fuel Corporation of Victoria introduced energy labelling for gas water heaters in 1981 This scheme was taken over by the AGA in 1985 who in 1988 introduced a six star energy performance label This label was intended to be visually consistent with the star rating labels already familiar to consumers of electrical appliances

The labelling scheme is currently voluntary and still administered by the industry body

A range of gas appliances have been subject to minimum energy performance standards (MEPS) since the 1960s The current MEPS levels were set in 1983 and

64

Brand Model Type MjyearStar

RatingSRI

StorageCapacity

(ltrs)IndoorOutdoor

NaturalGas

Instantaneous 18969 59 I N

Instantaneous 18969 59 I N

lsquothe majority of models currently on the market appear to exceed current requirements by a comfortable marginrsquo (SEAV 2003 p 23)

The gas energy labels are similar in format to those found on electrical appliances except they are blue and show annual energy use in MJ

A trial web site listing gas water heaters available in Australia is also available (see below)

Bottle Gas

Rinnai Infinity

V Series

REU-V2632FFU-A (Infinity 26 plus internal) P

Rinnai Infinity

V Series

REU-V2632FFUC-A (HD2001 internal) P

A joint review of the scheme is under way by the Gas Industry and Governments and regulation is under consideration A three year work plan has been published under the Australian and New Zealand Appliance and Equipment Energy Efficiency Program

Summary Currently voluntary labelling using lsquostarrsquo rating system with mandatory minimum energy performance standards Future regulation is under consideration

34 Green Vehicle Guide

Purpose

To provide web-based comparable and accessible environmental data on new motor vehicles

Background and strategy

65

The Commonwealth government started publishing a booklet of fuel consumption data for new passenger and light commercial vehicles in the early 1980s and a low cost web database in more recent years

In 2004 the Government through the Department of Transport and Regional Services (DOTARS) expanded the fuel consumption guide into the Green Vehicle Guide The Green Vehicle Guide is a web based database that rates new passenger and light commercial vehicles on air pollution greenhouse emissions and fuel consumption and gives an overall lsquostarrsquo rating for each vehicle within each vehicle category (small medium luxury sports etc)

The data on which the scores are derived are provided voluntarily by the vehicle manufacturers however this data is based on mandatory Australian Design Rule certification test data

The Guide uses a 5 star rating system however it also assigns half stars resulting in a total of 10 levels

The Greenhouse Ratings are based on carbon dioxide emissions and the Air Pollution Ratings take into account the relative environmental impact of oxides of nitrogen hydrocarbons and particles The relative harmfulness of the pollutants (shown in table below) has been quantified based on the allowable concentrations under the Ambient Air Quality National Environment Protection Measure (NEPM)

Green Vehicle Guide Weighting of Regulated Vehicle Emissions

Vehicle Emission

(equivalent pollutant under Air NEPM)

Calculated

Relative

Harmfulness

Final

Weighting

Carbon Monoxide (CO) 0088 Not included

Oxides of Nitrogen (NOx) (based on

Nitrogen Dioxide)

4 1

Hydrocarbons (HC) (based on

photochemical oxidants as ozone)

5 1

Particulate Matter (PM) (based on PM10) 20 5

Source Real and Jones 2005

NOx and HC were given equal final weightings despite the slight difference in the calculated relative harmfulness primarily because under ADR7900 a combined HC+NOx limit is prescribed rather than individual limits for each pollutant

The higher weighting for particulate matter recognises its significant health impacts The Air Pollution rating scale was devised in such a way that a lsquotypicalrsquo car (that is most petrol engined passenger cars meeting the current emission standard at the time) receives a mid-point rating (5 out of 10)

66

The overall rating or stars is derived from the sum of the air pollution and greenhouse scores ie they are equally weighted

Development of the Green Vehicle Guide (see extract below) involved extensive consultation with vehicle manufacturers

Website Costs

The new highly automated web database which contains data on approximately 1400 vehicles and has sophisticated search facilities cost approximately $200000 to develop plus around $100000 was spent recently to improve the sitersquos usability This compares to the previous low cost database which together with the printed guide cost less than about $80000 per annum The low cost version lacked the automation was only updated annually and did not have the ability to compared vehicles

The manufacturers provide the data on line using special access codes This data is checked by DOTARS before it is uploaded onto the website It takes close to a full time position within DOTARS to administer the website and respond to website related queries

Market Research and Marketing

Before the new greenvehicleguidegovau website was launched DOTARS commissioned consumer surveys to determine the level of knowledge about the environmental impacts made by vehicles This research showed that around half of those surveyed had the belief that ldquoall new cars have the same level of impact on the environmentrdquo

It became apparent through the surveys that there was a need to provide consumers with meaningful information on the relative performance of different vehicles This was a view shared by the Productivity Commission who said that while markets provide extensive information to consumers regarding fuel consumption of motor vehicles ldquothe Australian Governmentrsquos Fuel Consumption Labelling Scheme and Green Vehicle Guide provide relatively low cost accessible and comparable information to consumers and may be justified as part of the more fundamental objective of encouraging consumers to reduce the adverse environmental impacts of motor vehicle userdquo The Productivity Commission also commented that government

67

sources of information of this type were seen as credible and reliable and held in higher regard than information provided by others

DOTARS has scheduled some follow up consumer research for 200062007

DOTARS has spent about $600000 in marketing the Green Vehicle Guide This has included advertising in weekend guides in newspapers developing facts sheets plus targeted marketing to motor vehicle journalists

Summary Website - voluntary but legislative base

4 Government-Industry Partnership programs

Government-Industry Partnerships are the basis of many environmental initiatives and can take a number of forms Industry and government negotiate the terms of the program which are normally detailed in a formal agreement which sets out the environmental objectives and the responsibilities of each party towards their achievement

The GovernmentIndustry Partnership programs outlined below indicate the varied nature of these initiatives

41 The National Packaging Covenant

The National Packaging Covenant (the Covenant) commenced in 1999 and is a voluntary agreement between all levels of government and companies throughout the packaging chain including raw material suppliers packaging producers and retailers The Covenant commits signatories to the implementation of best practice environmental management in areas such as packaging design production and distribution and research into life cycle issues Signatories to the Covenant produce action plans on the measures they will implement to reduce packaging waste and they report annually on their progress In this sense the Covenant provides flexibility to signatories to develop plans suitable to their own circumstances The Covenantrsquos success (it currently has over 600 signatories) is due to the active promotion of it by Government and key industry players

The Covenant is complemented by a regulation the National Environment Protection (Used Packaging Materials) Measure (the NEPM) which enables states and territories to use enforcement action to require companies that donrsquot sign the agreement to take steps to reduce their packaging waste Preceding the Covenant and the NEPM were a number of voluntary industry agreements but these were limited in scope and largely focused on companies in the beverage industry

42 National Industry Reduction Agreement

The Publishers National Environment Bureau (PNEB) was formed in 1990 as an association of the major publishers of newspapers and magazines in Australia to promote the recovery and recycling of old newspapers and old magazines primarily from community kerbside collections organised by local councils

68

The PNEB and a newsprint manufacturer have voluntarily entered into a series of five-year Industry Waste Reduction Agreements with the Commonwealth and State Governments Under the current (third) plan 2001-2005 newsprint recycling in Australia has grown to 754 nationally in 2005 from the 28 level when the PNEB was formed in 1990

43 StateLocal target based programs

There have been a number of agreements signed by state government departments and an industry group where there is a stated goal to reach a specific environmental target For example in the early 1990s there was a voluntary agreement with the EPA Victoria and companies in the Altona Chemical Complex in the western suburbs of Melbourne (which includes Australian Vinyls BASF Dow Chemicals and Qenos) to reduce hydrocarbon emissions by 50 within a specified timeframe The target was met and further emissions reductions were negotiated The NSW EPA-Oil industry petrol volatility agreement outlined below is another example of a target based program

44 NSW EPA-Oil Industry Memorandum of Understanding on Summer Petrol Volatility

In 1998 NSW established arrangements for the supply of low volatility petrol in summer in the Sydney Greater Metropolitan Region implemented through a Memorandum of Understanding between the then EPA and oil companies The principal reason for controlling petrol volatility in summer is to reduce evaporative emissions of VOCs (from vehicles and production and storage sites) which contribute to ozone formation

The Memorandum of Understanding operated over four summer periods from 1998 to 2002 and involved companies voluntarily reducing petrol volatility (measured in kilopascals (kPa) of vapour pressure) over three summer periods from a base of 76kPa to 70kPa in the first summer 67kPa in the second and 62 kPa in the last two years

Although the Memorandum of Understanding was successful in progressively reducing petrol volatility over the period of its operation it was not supported by all industry members Consequently agreement was reached with industry that summer petrol volatility limits should be regulated to ensure a level playing field for all industry participants and regulated limits will apply from the summer of 200405

69

5 Summary of Australian Benchmark Programs

Program National State

Summary of Approach Impact

Voluntary Programs Altona Chemical Complex (Vic)

Local Small industry group worked towards self determined targets

Very high

Energy Star National Standards based label Limited Gas appliance Rating Scheme

National Industry operated labelling scheme with stars assigned therefore has graded benchmarksminimum performance standards out dated web database being developed

Low

National Industry Reduction Agreement

National Small industry group worked towards negotiated targets

High

NSW EPA-Oil Industry MOU

State Small industry group worked towards negotiated targets but not all involved ndash lead to regulations

Moderate

Top Energy Saver Award

National Achievement based label Limited

Quasi Regulatory Green Vehicle Guide

National Well promoted web database star ratings assigned therefore has graded benchmarks data provided voluntarily but backed by ADR requirements

High

Stand-by power National Required to achieve voluntary targets or regulation will be introduced

Unknown

National Packaging Covent

National Performance based targets backed by legislation High

Regulatory Energy Efficiency Labels

National Labelling scheme with stars assigned therefore has graded benchmarksbased on Australian Standard web database

High

MEPS National Sets base benchmark and works with energy rating

High

WELS Scheme National Labelling scheme with stars assigned therefore has graded benchmarksbased on Australian Standardweb database

High

Wood heaters State Only one benchmark assigned regulations are not uniform

Moderate

authorrsquos assessment based on direct or indirect knowledge of these programs

70

Appendix 3 Productivity Commission Comments on Labelling and Minimum Performance Standards

The Productivity Commission an independent agency which is the Australian Governmentrsquos principal review and advisory body on microeconomic policy and regulation recently examined the cost effectiveness of improving energy efficiency As part of its review lsquoThe Private Cost Effectiveness of Improving Energy Efficiencyrsquo it examined labelling programs minimum mandatory energy efficiency requirements and other means of providing consumer information The final report contains some highly relevant material that is applicable to establishing a benchmarking scheme for small engines

The following is a summary of relevant conclusions from the Inquiry

Government Operated Labelling Schemes

From consumer research provided to the Commission it concluded that ldquothere is some evidence to suggest that consumers are now paying more attention to labels than they have in the pastrdquo

The Commission was positive about labelling programs as labels

bull directly address ldquoa source of market failure mdash the asymmetry of information between buyers and sellers of energy-using productsrdquo

bull provide information to the consumer that is readily-accessible and easily-understood and therefore can assist in helping the consumer make better-informed choices

bull are likely to have produced net benefits for consumers

bull do not directly limit consumer choice

bull could provide a greater incentive for suppliers to sell products that use energy cost effectively

bull probably produced net social benefits

bull are most suited where there is a wide spread in the range of performances of comparable appliances and where information failures are most pronouncedrdquo

bull can be used to warn consumers that an appliance is very inefficient (through a disendorsement label) which could be effective in discouraging but not preventing consumers from buying the poor performing product

The Commission was supportive of Governmentrsquos role of drawing together and packaging information through labelling programs as this ensures that ldquorelevant and trusted information gets to those who would otherwise not get itrdquo In material reviewed by the Commission George Wilkenfeld and Associates and Energy Efficient Strategies (1999) claimed that labelling is unlikely to be effective if purchasers rarely inspect appliances in a showroom where they can compare performance across

71

different models or the purchaser is not the ultimate user and so has little interest in operating costs

Labelling programs involves both administration and compliance costs such as those incurred by suppliers in having their products tested but the Commission considered that labels should be more actively considered as an alternative to minimum performance standards

Minimum Performance Standards

Governments can prevent the sale of inefficient products by using minimum standards for example the Minimum Energy Performance Standards (MEPS) that apply to appliances such as refrigerators and freezers air conditioners and electric water heaters If appliances do not meet the minimum standard they cannot be sold in Australia Some appliances are covered by both MEPS and by labelling (for example refrigerators)

The Commission considered that MEPS and labels can be complementary as MEPS act to penalise the worst energy performers whereas labels rewarding the better performers

Costs comparisons of schemes

The Department of the Environment and Water Resources provided details about the costs involved in administering both the labelling scheme and the minimum performance standards for energy programs It stated that

bull the administration costs of MEPS are substantially lower than for labelling but the compliance costs can be higher

bull MEPS can have a greater cost for suppliers than labelling since suppliers must adjust their model ranges to meet the MEPS levels by the given date These compliance costs are however influenced by the lsquolead inrsquo time between the introduction of the regulatory proposal and the implementation of the MEPS

bull it is estimated that the administration costs for MEPS would be $3 million over the period 2000ndash15 compared to $39 million for labelling (in present value terms) (George Wilkenfeld and Associates and Energy Efficient Strategies 1999) Furthermore it was assumed that 84 per cent of administration costs were borne by appliance purchasers with the remainder borne by governments

It estimated that MEPS would increase the cost of appliances by $266 million over 2000ndash15 compared to $688 million for labelling (the latter cost being due to consumers voluntarily purchasing more efficient appliances)

72

Page 4: Outdoor Garden Equipment - Department of the Environment

Appendix 1 Detailed Breakdown of Powered Garden Equipment on the Australian Market 51

Appendix 2 Examples of Current Australian Benchmarking Programs55

Appendix 3 Productivity Commission Comments on Labelling and Minimum Performance Standards 71

iii

List of Figures

Figure 1 Example of a Californian Consumer Advisory Hang Tag11

Figure 2 Extract from survey form18

Figure 3 Compliance with overseas standards - all surveyed products20

Figure 4 Compliance with overseas standards by equipment type21

Figure 5 Engine type for popular categories 21

Figure 6 Compliance with overseas standards for popular categories 22

Figure 7 OPEA estimates of equipment sales in 2005-0624

List of Tables

Figure 1 Example of a Californian Consumer Advisory Hang Tag11

Figure 2 Extract from survey form18

Figure 3 Compliance with overseas standards - all surveyed products20

Figure 4 Compliance with overseas standards by equipment type21

Figure 5 Engine type for popular categories 21

Figure 6 Compliance with overseas standards for popular categories 22

Figure 7 OPEA estimates of equipment sales in 2005-0624

i

Abbreviations and Glossary 2c Two stroke with carburettor 2di Two stroke with direct fuel injection 2i Two stroke with pre-chamber fuel injection 4c Four stroke with carburettor 4i Four stroke with fuel injection (includes direct injection) ABS Australian Bureau of Statistics ABT Averaging Banking and Trading of emissions ADR Australian Design Rule Air NEPM National Environment Protection Measure for ambient air quality BTEX Benzene toluene ethylbenzene xylenes - carcinogenic or mutagenic aromatic

hydrocarbons formed through the combustion process CARB Californian Air Resources Board CBA Cost Benefit Analysis cc Cubic centimetres CO Carbon Monoxide DEC Department of Environment and Conservation di Direct Injection efi Electronic fuel injection EU European Union Euromot The European Association of Internal Combustion Manufacturers gkW- hr Grams per kilowatt hour HCs Hydrocarbons ndashmost are VOCS and in relation to small engines the terms are

often used interchangeably hp Horsepower 1 hp =7457 watts ISO International Standards Organization kW Kilowatts MEPS Minimum Energy Performance Standards MOU Memorandum of Understanding NATA National Association of Testing Authorities NOx Oxides of Nitrogen NPI National Pollutant Inventory NSW GMR New South Wales Greater Metropolitan Region which includes Sydney Lower

Hunter and Illawarra regions encompassing the major metropolitan centres of Sydney Newcastle and Wollongong Population approximately 47 million

OPEA Outdoor Power Equipment Association PM10 Particles with an aerodynamic diameter of 25 micrometres or less PM25 Particles with an aerodynamic diameter of 10 micrometres or less Port Phillip Region in Victoria of 24000 km2 that includes Greater Melbourne and Greater Region Geelong It is defined in Victorian environmental policy Population

approximately 34 million (1996) SE Qld South East Queensland - a region that covers the area from the Gold Coast to the

Sunshine Coast and west to Toowoomba It includes Brisbane amp suburbs population approximately 23 million people

USEPA United State of America Environmental Protection Agency VOCs Volatile Organic Compounds WELS Water Appliances Water Efficiency Labelling and Standards Scheme

ii

Executive Summary

Background

This report sets out the results of a project to compare and benchmark emissions from small petrol engines (less than 19 kilowatts) that are used to power outdoor garden equipment and were available for sale in Australia during 2006 The equipment powered by these small engines are used in lawnmowers brushcutters hedge trimmers and the like

These engines emit volatile organic compounds (VOCs) and oxides of nitrogen (NOx) which contribute to ozone (photochemical smog) formation in summer They also emit particles carbon monoxide (CO) and a range of air toxics such as benzene

Sydneyrsquos Greater Metropolitan Region (GMR) annually records exceedances of the National Environment Protection (Ambient Air Quality) Measure (Air NEPM) ozone standards The other jurisdictions meet or are close to meeting the current ozone standards

The Air NEPM standards are being reviewed and based on current human health evidence the argument appears to be strengthening for tighter ozone standards Should a stricter standard or an eight-hour standard consistent with international standardsguidelines be adopted achievability of Air NEPM ozone standards or goals could become an issue for some of the other major urban airsheds

The United States California Canada and Europe regulate emissions from outdoor equipment - the USA has had these in place since 1997 There are no Australian regulations or standards that limit air pollutant emissions from engines used in outdoor garden equipment however as the majority of equipment sold in Australia is imported some do comply with emission standards applicable to the country of origin

Small engines are not as advanced in environmental terms as motor vehicle engines As a result even the better-performing small engines emit far greater quantities of pollutants per hour than typical modern car engines For example the US Environmental Protection Agency (USEPA) 2002 limit for a typical 4 kilowatt (kW) lawnmower motor is about 66 grams (g) of regulated pollutants per hour of operation A typical 08kW brushcutter sold new in 2002 emitted about 160grams of pollutants per hour - reducing to 40grams per hour if bought new in 2006 The equivalent limit for cars under Australian Design Rule 79 is about 16g per hour In other words one hour of operation of a brushcutter that meets USEPA 2002 limits produces the same pollution as ten cars operated over a similar time These comparisons are subject to differences in test methods but they do provide an indication of the disproportionate amount of pollution emitted by small engines

Engines that do not comply with current USEPA requirements are likely to emit several times the amount of pollution calculated in the above example Therefore the worst performing engines are likely to emit more than ten times the emissions of the best performers

iii

Based on estimates made using the National Pollutant Inventory database engines used in lawn mowers contribute approximately 4 on average to VOC emissions from anthropogenic sources in major airsheds in Australia when public open space lawn mowing is included This is likely to rise to around 11 in the warmer spring and autumn weekends which is when lawns and other vegetation grows faster and when gardening is more popular The NPI does not take into account emissions from other types of powered outdoor equipment

The Australian Market

According to the Outdoor Power Equipment Association (OPEA) approximately 424000 walk behind lawnmowers and more than 792000 units of outdoor handheld equipment were sold in Australia in 2005-06 In addition there were sales of about 80000 replacement engines and 70000 pumps in 2005-06 most of which were four strokes The general household consumer represents the major market segment for garden equipment accounting for up to 90 of product sales with commercial garden services and government purchasing the rest

Indications are that sales of imported high polluting two stroke engines have increased over the last few years and it appears that the price of some powered garden equipment has dropped to the level where consumers regard them as disposables

An assessment of outdoor equipment on the Australian market found that the majority of small engines sold in Australia are imported and many come from countries that impose emission limits The extent of imports into Australia that do not comply with the country of origin standards is not known However the industry estimate that 40 of garden products are sold through importers who are not linked to manufacturers of US EPA or European certified equipment and the source of some products sold here is difficult to establish Victa is the only company producing small engines in Australia Its iconic 2-stroke lawn mower engine currently does not meet overseas emission limits for non-handheld equipment and Victa is undertaking research and development to reduce emissions from its two stroke engine to meet US and European standards

In spite of several attempts to obtain data on compliance with overseas emission standards from Australian distributors their response was poor The following figure therefore provides a best estimate of expected compliance of outdoor equipment on the Australian market with European CARB or USEPA requirements applicable in 2004

iv

Figure E1 Compliance with overseas standards for popular categories ldquoPhase 1 equivrdquo means the engine complies with US EPA phase 1 or 200288EU ldquoPhase 2 equivrdquo means the engine complies with US EPA Phase 2 Euro I or Euro 2 ldquoUnknown means that engine cycle (stroke) was not provided

Measures to Increase Sales of Low Emission Garden Equipment Engines

There is a range of options that could be considered for reducing emissions from engines used in outdoor garden equipment engines in Australia These include

1 Maintaining the Status Quo

2 Government ndash Industry Partnership Program

3 Quasi regulation

4 Co-regulation

5 Regulations based on either a simple benchmark or tiered benchmarks

The Small Engine Expert Panel ndashOutdoor Equipment has considered in depth the most appropriate approach to take to improve the emissions performance of outdoor garden equipment sold in Australia It recommends the introduction of national regulations to control the emissions from outdoor garden equipment particularly in light of the increase in cheap imports onto the Australian market which although untested are considered very likely to have high emission levels The Expert Panel has developed some broad recommendation on which Australian regulations could be based which takes in consideration the local market and Victa These are summarised as follows

1 Mandatory air pollutant emission standards to be introduced in Australia for all outdoor equipment (lt19kW) powered by spark-ignition engines

v

The development of any regulation would need to be based on a formal assessment of the costs and benefits of nationally regulating two and four stroke lawn mowers and handheld power equipment which should commence immediately

2 Proposed standards to mirror US EPA regulations (compliance with equivalent EU regulations also acceptable)

3 Timing (subject to completion of assessment of costs and benefits)

(a) US EPA Phase 1 ndash Effective from 20072008

(b) US EPA Phase 2 ndash Fully implemented in 2012 (in step with 2007 USEPA limits) plus a phase-in period andor provisions for averaging banking and trading (ABT) of emissions over 2008-2012 to provide for early introduction of cleaner product

The US EPA Phase 1 and Phase two emissions limits are given in the table below

4 Walk-behind two stroke mowers to be included in US EPA Category 5 (gt50cc) product classifications (to provide Victa time to develop a cleaner engine) Implementation timing is proposed to be the same as Recommendation 3 above

5 All products also to be certified to relevant EPA product durability categories

6 Subject to further review ABT if included may be phased out after 2012

Table E1 Comparison between the USA Phase 1 and Phase 2 standards

Emission Limits GkW-hr

Phase 1 (1997 ndash2001) Phase 2 (2007) HC NOx HC+NOx CO HC+NOx CO

Non-handheld

I-A lt66cc 161 161 610

I-B 66-lt100cc 161 161 610

I 100-225 cm3 161 519 161 610

II 225 cm3 134 519 121 610

Handheld

III lt20 cm3 295 536 805 50 805

IV 20-50 cm3 241 536 805 50 805

V 50 cm3 161 536 603 72 603 Phase 2 limits were phased in between 2002 -2007 during which time they became tighter

For simplicity only the 2007 are shown in this table (see Table 2 for more details)

vi

Conclusion

From this review it is apparent that it is highly unlikely that the companies in the industry would engage in or commit to any voluntary type program It is therefore clear that the most expedient path to reduce emissions from these small engines is through national regulation State based regulations could only provide a piecemeal approach that would lead to product dumping in states where there are no regulations and inconsistent regulations that require industry to treat each state market differently In addition enforcement of any state based regulations would be a key problem due to existing Commonwealth and State Government mutual recognition legislation

While any national regulation of emissions from small engines used in garden equipment in Australia are likely to be based on overseas regulations they need to strike a balance between improved environmental outcome harmonisation with international standards and the characteristics of the local industry With regulations optimum emissions reduction are potentially achievable by combining minimum emissions standards with tiered product labelling Whether this approach is justifiable on economic grounds that is the benefits outweigh the costs can only be determined through a detailed impact assessment Based on these findings it is recommended that a formal assessment of the costs and benefits of nationally regulating two and four stroke lawn mowers and handheld power equipment should be commenced

vii

1 Introduction

This report sets out the results of a project to compare and benchmark emissions from engines used in outdoor garden equipment that were available for sale in Australia during 2006 Possible outcomes from the project range from consumer guidelines for selecting low emission engines to regulatory controls on emissions There are currently no state or national regulations that directly control emissions from these engines

The project was commissioned by the Commonwealth Department of the Environment and Water Resources on behalf of state and territory government departments working on reducing the impacts of small engine emissions This report was prepared in consultation with an Expert Panel that included representatives from the Outdoor Power Equipment Association (OPEA)

11 Emissions from outdoor garden equipment engines

Small engines particularly conventional two stroke engines used in applications such as outdoor garden equipment are high polluters relative to their engine size and usage1 These small engines emit volatile organic compounds (VOCs) and oxides of nitrogen (NOx) which contribute to ozone (photochemical smog) formation in summer They also emit particles carbon monoxide (CO) and a range of air toxics such as benzene The USA California Canada and Europe and regulate emissions of VOCs NOx carbon monoxide and particle emissions from outdoor garden equipment

There are five types of spark-ignition engines that can be used in outdoor garden equipment

bull two stroke with carburettor (2c)

bull two stroke with pre-chamber fuel injection (2i)

bull two stroke with direct fuel injection (2di)

bull four stroke with carburettor (4c)

bull four stroke with fuel injection (4i) (includes direct injection)

Carburettor and pre-chamber fuel injection two stroke engines are inherently more polluting than the other three types This is due to their inability to completely separate the inlet gases from the exhaust gases resulting in up to 30 of the fuel being left unburnt and the need to add oil to the fuel to lubricate the engine (four stroke engines have separate reservoirs for fuel and oil) However twostroke carburettor engines typically weigh less than a four stroke engine of the same power and this tends to make them attractive for handheld equipment They also tend to have fewer components are generally cheaper to purchase and are cheaper to maintain than

1 Outdoor equipment covered in this report are engines less than 19kW

1

four stroke motors Victa Lawncare is currently undertaking research and development to improve the environmental performance of two stroke carburettors and while some emission improvements have been made a two stroke compliant with US or European standards is still considered several years away

Four stroke carburettor engines are generally quieter more fuel efficient and are less polluting than conventional two stroke engines

Direct fuel injection (dfi) either two stroke or four stroke overcomes the unburnt fuel problem and can meet the stringent regulated exhaust emission limits that apply overseas However there is not any evidence that dfi engines are being used in outdoor garden equipment available in Australia It appears that engines used in outdoor garden equipment in Australia are generally restricted to two and four stroke carburettor engines

Small engines are not as advanced in environmental terms as motor vehicle engines As a result even the better-performing small engines emit far greater quantities of pollutants per hour than typical modern car engines For example the US Environmental Protection Agency (USEPA) 2002 limit for a typical 4 kilowatt (kW) lawnmower motor is about 66 grams (g) of regulated pollutants per hour of operation A typical 08kW brushcutter sold new in 2002 emitted about 160grams of pollutants per hour - reducing to 40grams per hour if bought new in 2006 The equivalent limit for cars under Australian Design Rule 79 is about 16g per hour In other words operated over a similar time one hour of operation of a brushcutter that meets USEPA 2002 limits produces the same pollution as ten cars and a 4kW lawnmower the same pollution as four cars These comparisons are subject to differences in test methods but they do provide an indication of the disproportionate amount of pollution emitted by small engines

Engines that do not comply with current USEPA requirements are likely to emit several times the amount of pollution calculated in the above example Therefore the worst performing engines are likely to emit some ten times the emissions of the best performers

Because of the combustion of oil these engines also emit high levels of particles Although small engines only contribute a small amount to total particle emissions the rate of particle release compared to other engines can be very high For example lawnmowers can emit over 10 times more particles (in terms of grams per hour) than a petrol motor vehicle (manufactured between 1994 and 2001)

All the above emission comparisons between outdoor garden equipment engines and motor vehicles are subject to differences in test methods but they indicate the disproportionate amount of pollution emitted by small garden equipment engines It also needs to be recognised that motor vehicles in Australia average more than 15000 kilometres per year (ABS 2003) while the annual average use of outdoor garden equipment is around 25 hours for a lawnmower and less for other types of equipment Commercial operators however are likely to have a much higher usage rates than the general public

2

This paper examines the Australian market for small engines used in lawnmowers and handheld garden equipment their impact on air quality relevant overseas regulations and their applicability to Australia and makes recommendations to reduce air quality impacts from these engines

A wide range of information sources has been referenced for this report including data and information supplied by manufacturers distributors and dealers in small engines

3

2 Air Quality and Outdoor Garden Equipment Engines

Emission inventories make estimates of emissions of substances from a multitude of sources into airsheds The National Pollutant Inventory (NPI) which is run cooperatively by the Australian state and territory governments contains data on 90 substances that are emitted to the Australian environment The substances included in the NPI have been identified as important because of their possible health and environmental effects Industry facilities estimate their own emissions annually and report to states and territories Non-industry (or diffuse) emissions estimates which includes emissions from outdoor garden equipment are made by the states and territories on a periodic basis using information sources such as surveys databases and sales figures

The NPI only reports emissions from domestic lawn mowing and for a few airsheds the contribution made by public open space lawn mowing It does not report on the contribution made by other types of outdoor garden equipment such as brushcutters National and selected state NPI emissions estimates for the common air pollutants and for Air Toxics NEPM pollutants from domestic lawn mowing are summarised in Table 1 It should be noted that national emissions from lawn mowing are underestimates as the NPI records emissions for major airsheds only and therefore is not Australia wide plus the estimates do not include evaporative emissions from fuel tanks and hoses

This NPI data is indicative only as the accuracy and completeness of the data sets varies across airsheds and is reliant on the estimation techniques used For example while the population in the NSW is higher than other airsheds its emissions look disproportionally high when compared to the other airsheds This could be because the estimation technique varies or it is due to some other factor

4

Table 1 National Pollutant Inventory Domestic Lawn Mowing Emission Estimates

Substance Port Phillip

Population 34 mill (1996)

SE Qld

Population 23 mill

NSW GMR

Population 47 mill

Adelaide

Population 10 mill

National

Common Air Pollutants (tonnesyear)

Carbon monoxide 12000 12000 24000 6100 69000

Total Volatile Organic Compounds 3600 3800 7000 2000 21000

Particulate Matter 100 um 86 94 170 9 460

Sulphur dioxide 5 5 9 50 81

Oxides of Nitrogen 63 54 120 24 330

Air Toxics (tonnesyear)

Benzene 230 210 390 130 1200

Formaldehyde 56 38 NA 31 180

Polycyclic aromatic hydrocarbons 07 11 21 04 41

Toluene (methylbenzene) 370 360 660 210 2000

Xylenes (individual or mixed isomers) 270 260 490 150 1500

Analysis of the NPI database at the national level shows that domestic lawn mowing is the

- Fourth largest source of benzene contributing 7 to the total reported airshed load

- Fourth largest source of formaldehyde contributing 3 to the total reported airshed load

- Fifth largest source of xylene contributing 6 to the total reported airshed load

- Fifth largest source of toluene contributing 6 to the total reported airshed load

- Sixth largest source of carbon monoxide contributing 12 to the total reported airshed load

- Ninth largest source of VOCs contributing 3 to the total reported airshed load when biogenics (natural sources such as trees and soil) are excluded

The NSW Department of Environment and Conservation has been upgrading its emissions inventory Based on 2003 emissions data non-road anthropogenic sources

5

contribute 619 of the VOCs to the GMR airshed Preliminary results2 indicate that VOC emissions from domestic and public open space lawn mowing contributes on an annual average 41 of all VOC emissions in the GMR On a typical weekend during warmer weather this percentage rises to 11

Therefore it could be assumed that lawn mowing could contribute approximately 4 on average to VOC emissions from anthropogenic sources in major airsheds in Australia when public open space lawn mowing is included This percentage is likely to rise significantly in the warmer spring and autumn weekends which is when lawns and other vegetation grow faster and when more people garden

21 Air Quality Standards

In June 1998 the National Environment Protection Measure for Ambient Air (Air NEPM) established national uniform standards for ambient air quality for the six most common air pollutants ndash carbon monoxide nitrogen dioxide photochemical oxidants (measured as ozone) sulfur dioxide lead and particles less than 10 microns (PM10) The NEPM was varied in 2003 to include PM25 advisory reporting standards and in April 2004 a National Environment Protection Measure for Air Toxics was adopted

Nationally the common pollutants of most concern (particularly in major urban areas) are fine particles and ground level photochemical smog (measured as ozone) which is formed in the warmer months when volatile organic compounds (VOCs) and oxides of nitrogen (NOx) react in the atmosphere under the influence of sunlight in a series of chemical reactions

Recent health studies (cited in NEPC 2005) have strengthened the evidence that there are short-term ozone effects on mortality and respiratory disease The studies also strengthen the view that there does not appear to be a threshold for ozone below which no effects on health are expected to occur In recent years Australian epidemiological studies have been conducted which confirm the results of overseas studies that there is a relationship between elevated ozone levels and hospitalisations and deaths from certain conditions

There are two national ozone standards a one hour standard of 010ppm and a four hour standard of 008ppm with a goal that allows for one exceedance per year by 2008 Sydney experiences a number of days each year of ozone levels above these standards In 2003 Sydney exceeded the one hour standard on 11 days in 2003 19 days in 2004 and 9 days in 2005 The four hour standard was exceeded on 13 days in 2003 19 days in 2004 and 13 days in 2005 Further reductions in VOC and NOx emissions are needed to reduce ozone concentrations in Sydney to levels that would comply with the Air NEPM

The other jurisdictions meet or are close to meeting the current National Environment Protection (Ambient Air Quality) Measure (Air NEPM) ozone standards (NEPC 2005) However the ozone standards are being reviewed and based on current human health evidence the argument appears to be strengthening for tighter ozone standards

2 Presentation to Expert Panel 27 April 2006 by Nick Agipades Manager Major Air Projects NSW DEC

6

Should a stricter standard or an eight-hour standard consistent with international standardsguidelines be adopted achievability of Air NEPM ozone standards or goals could become an issue for some of the other major urban airsheds (NEPC 2005)

Modeling of ozone for Sydneyrsquos Greater Metropolitan Region (GMR) indicates that the implementation of Euro emission limits for on-road vehicles and hence the increased presence of these less polluting vehicles in the fleet and retirement of old more polluting vehicles from the fleet is not sufficient to meet the current NEPM goals Modeling suggests that very large reductions in precursor emissions would be required to meet the current ozone one hour goal (NEPC 2005)

Even when the effects of bushfires and when hazard reduction burning are taken into consideration airsheds such as Launceston Melbourne and Sydney struggle to meet the national standards for particles (EPA 2006) However outdoor powered equipment predominantly from two stroke engines makes only a minor contribution to ambient fine particle loads

While carbon monoxide emissions from engines used in outdoor garden equipment are regulated overseas air monitoring in Australia indicates that carbon monoxides levels are well below the national air quality standards and there are no pressing issues requiring CO from outdoor powered equipment to be regulated In addition data indicates that lowering emissions of VOCs and NOx from small engines reduces CO emissions

Many of the pollutant sources which contribute to the formation of ozone and to particle levels also contain air toxics such as benzene toluene formaldehyde and xylenes These air toxics have been shown to be responsible for a range of health problems including asthma respiratory illnesses and cancer The National Environment Protection Measure for Air Toxics requires each jurisdiction to monitor and report annually on five air toxics benzene polycyclic aromatic hydrocarbons formaldehyde toluene and xylenes The monitoring data is intended to inform future policy and also the public on ambient levels of these air pollutants Monitoring of air toxics to date shows that levels are low and below the national monitoring investigation levels (EPA Vic 2006 DEC 2006)

7

3 Emission Standards for Small Engines

31 Australia

At present there are no Australian regulations or standards to limit air pollutant emissions from small (two and four stroke) engines Australia does benefit to some extent from overseas regulations as many lawnmowers and other gardening equipment sold in Australia have engines manufactured in the United States or Europe where strict standards apply

32 United States

In the United States emission regulations set by the United States Environmental Protection Agency (USEPA) and the Californian Air Resources Board (CARB) apply to lawn mowers and other powered gardening equipment Although CARB standards currently tend to be stricter than USEPA standards by 2006 emissions limits applying under the two standards will be very similar

United States Environment Protection Agency (US EPA)

In 1995 the USEPA introduced ldquoPhase 1rdquo regulations covering small non-road engines with a power of not more than 19kW (25HP) The regulations applied to equipment manufactured from 1997

These regulations have seven classes of equipment based on portability and engine displacement volume (ldquocapacityrdquo) In March 2000 the USEPA published ldquoPhase 2rdquo regulations which are shown in Table 2 These set limits for combined emissions of hydrocarbons (HC) and oxides of nitrogen (NOx) and separate limits for carbon monoxide (CO) emissions and for two stroke engines only particles

Table 2 US EPA Phase 2 Small Engine Emissions Standards (HC+NOx in gkW-hr) (a) (b)

Small Engine Class

Type 2002 2003 2004 2005 2006 2007+

I-A (lt66cc) Non-handheld (eg lawnmowers)

- 161 161 161 161 161

I-B (66 to lt 100cc) - 161 161 161 161 161

I (100 to lt 225cc) - 161 161 161 161 161

II (225cc or more) 180 166 150 136 121 121

III (lt20cc) Handheld (eg trimmers)

238 175 113 50 50 50

IV (20 to lt50cc) 196 148 99 50 50 50

V (50cc or more) - - 143 119 96 72 (a) As carbon monoxide (CO) levels in Australia are well below the Air NEPM standard the

USEPA emission limits for CO have not been included in this table (b) Includes useful life criteria of 50125300 hours

8

When the USEPA introduced ldquoPhase 2rdquo regulations it included averaging banking and trading provisions (ABT) which were seen ldquoas an important element in making stringent Phase 2 emissions standards achievable with regard to technological feasibility lead time and costrdquo (USA 1999) The USEPA also claimed (USA 2000) that the ABT program secures early emissions benefits through the early introduction of cleaner engines

ABT provisions which apply to handheld and non handheld engines are complex but in broad terms averaging means the exchange of emission credits among engine families within a given engine manufacturerrsquos product line This allows a manufacturer to produce some engines that exceed the standards and offsetting these exceedances with emissions from engines that are below the standard Manufacturers are allowed to exchange credits from handheld to non handheld and vice versa Banking means the retention of emission credits by the engine manufacturer generating the credits for use in a future model year (for averaging or trading) Trading is the exchange of emission credits between engine manufacturers which then can be used for averaging purposes banked for future use or traded to another engine manufacturer

In January 2004 USEPA reported that in 2002 averaging was being used but there was very little use of banking It determined that the initial ABT programs as too complex and included discount rates on credits ABT was simplified in 2004 including the elimination of credit discount and multipliers and limits on credit life To date there has reportedly been limited use of banking however it is anticipated that there will be more widespread use of banking credits if the USEPA proposed Phase 3 comes into effect3 (see below)

Particulate limits (2gkW-hr) also apply to two stroke engines Carbon monoxide and durability limits (or useful life) are also prescribed The durability criteria which were introduced in Phase 2 require that the emission limits must be met through the useful life of the engine The manufacturer determines useful life of each product using standardised product testing procedures and then based on the test results selects the useful life category for each product which can be 125 250 or 500 hours These durability criteria acknowledge the large disparity in usage patterns by equipment type and between commercial and residential users It also takes into account the ability of manufacturers to design and build engines for various design lives and which fit the types of equipment engine is produced for

The March 2000 USEPA report (USEPA 2000) estimated that the expected effects of the Phase 2 regulations would be

bull A 70 reduction in HC+NOx beyond the Phase I standards (which were estimated to have reduced emissions by 32 from the unregulated baseline)

bull A 30 reduction in fuel consumption of small handheld equipment bull Price increases of between $US23 (Class III) and $US56 (Class V) for

handheld equipment

3 Dave Gardner Briggs and Stratton email 22506

9

The US EPA is currently considering lsquoPhase 3rsquo regulations which are catalyst based standards to further reduce exhaust HC and NOx emissions from non handheld engines reduce evaporative HC and NOx emissions for both handheld and non handheld engines plus include extended durability criteria These limits are currently at discussion stage only They align with CARB Tier 3 but a longer lead time is proposed

Table 3 Proposed Phase 3 Exhaust Emissions

HC+NOx gkW-hr

CO gkW-hr

Year Useful life hrs

Class I 100 610 2010 125250500

Class II 80 610 2011 2505001000

Class III-V No changes

HC+NOx std is based on averaging

Californian Air Resources Board (CARB)

Spark ignition engines

CARB regulations first introduced emission limits for small engines manufactured from1995 The more recent schedule of emission limits are shown in Table 4 These limits depend solely on the engine capacity and apply to both handheld and non handheld classes

Table 4 CARB Emission Limits for Small Engines (HC+NOx in gkw-hr)

Engine Capacity 2000-2001 2002-2005 2006+

65cc or less 72 72 72

gt65cc to 225cc 161 161 161

gt225cc 134 121 121

California has particle limits for two strokes useful life criteria and mandatory engine labeling including a consumer advisory hang tag as shown in Figure 1 The USEPA is also considering introducing an air index label

10

Figure 1 Example of a Californian Consumer Advisory Hang Tag The Californian regulations take into account sales weighted emission performance for families of engines An engine family is essentially the same engine being used in different equipment items

In 2003 California adopted a Tier 3 program for exhaust and evaporative emissions and these are based on the use of catalytic convertors The engine classes better align with US EPA categories however the exhaust standards for Class I and Class II are more stringent than the existing US EPA standards

Table 5 CARB Tier 3 for Exhaust Emissions

Model Year Displacement Category

Durability Periods (hours)

HC+NOx gkw-hr

CO gkw-hr

Particulate gkw-hr

2005 and subsequent

lt50 cc 50125300 50 536 20 + 50-80 cc inclusive 50125300 72 536 20 +

2005 gt80 cc - lt225 cc Horizontal-shaft eng

125250500 161 549

gt80 cc - lt225 cc NA 161 467 Vertical-shaft Engine 225 cc 125250500 121 549

2006 gt80 cc - lt225 cc 125250500 161 549 225 cc 125250500 121 549

2007 gt80 cc - lt225 cc 125250500 100 549 225 cc 125250500 121 549

2008 and subsequent

gt80 cc - lt225 cc 125250500 100 549 225 cc 1252505001000 80 549

the 1000 hours is applicable for 2008+ Model Year (MY) + applies to 2 stroke only Source California Exhaust Emission Standards and Test Procedures For 2005 And Later Small Off-Road Engines Adopted July 26 2004 effective on October 20 2004

California also has Blue Sky provisions These are voluntary standards for engines that meet the criteria shown in Table 6 Blue Sky Series engines are not included in

11

the averaging banking and trading program Zero-emission small off-road equipment (eg push mowers) may certify to the Blue Sky Series emission standards

In 2005 CARB aligned its test procedures with the USEPA

Table 6 CARB Blue Sky Provisions

Model Year Displacement Category

HC+NOx gkw-hr

CO gkw-hr

Particulate

2005 and subsequent lt50 cc 25 536 20

50 - 80 cc inclusive 36 536 20

2007 and subsequent gt80 cc - lt225 cc 50 549

2008 and subsequent 225 cc 40 549 Applicable to all two stroke engines

33 Canada

The Canadian small engine market has similarities to the Australia market the majority of small engines are imported from the USA and there is one Canadian manufacturer of small spark ignition engines and one major manufacturer of lawn and garden machines

A Memorandum of Understanding (MOU) which came into effect on 1 January 2000 was signed between Environment Canada and ten manufacturers of handheld equipment and nine manufacturers of engines used in non handheld machines The MOU was intended as an interim measure until regulations could be put in place Under the MOU the manufacturers agreed to voluntarily supply small spark ignition engines designed to meet the applicable USEPA Phase 1 emission standards

In 2003 Canada regulated emission limits for handheld and non-handheld small engines based on USEPA emission limits The regulations apply to model years 2005 and later While there are no separate averaging banking and trading provisions in Canadian regulations Canada allows any USEPA certified engine to be sold in Canada This means that engines that do not meet the standard level but are averaged (or use credits) in the United States can be sold in Canada Manufacturers are required to produce upon request evidence of conformity to the standards and are required to provide written instructions on engine maintenance to the first retailer

12

Table 7 Canadian Small Spark-Ignition Engine Exhaust Emission Standards

Engine class

Engine Type

Engine Displacement (cm3)

Effective date (model year)

Standard HC+NOx (gkWshyhr)

Standard NMHC+NOx (gkW-hr)

Standard CO (gkWshyhr)

I-A Non-handheld lt66 2005 and

later 50a -shy 610a

I-B Non-handheld

lt100 and 66

2005 and later

40a 37a 610a

I Non-handheld

lt225 and 100

2005r 161b 148a 519b 610a

II Non-handheld 225 2005 and

later 121a 113a 610a

III Handheld 20 2005 and later 50a -shy 805a

IV Handheld lt50 and 20 2005 and later

50a -shy 805a

V Handheld 50 2005 2006 2007 and later

119a 96a

72a

-shy-shy

-shy

603a 603a

603a a Standards apply throughout the engine useful life b Standards apply only when the engine is new Source Canada Gazette Part II Vol 137 No 24 2003-11-19

34 Europe

In 1998 the European Union introduced exhaust emission limits for small petrol engines through Directive 9768EC and in 2002 introduced amendments through Directive 200288EC The limits in the Directives align with the US regulations however they do not have averaging and banking provisions

Table 8 European Emissions Standards

Small Engine Class Type (HC+NOx in gkW-hr) 2004 2005 2006 2007 2008

SN1 (lt66cc) Non-handheld (eg lawn mowers)

161 161 161 161 161

SN2 (66 to lt 100cc) 161 161 161 161 161

SN3 (100 to lt 225cc) - - - 161 161

SN4 (225cc or more) - - 121 121 121

SH1 (lt20cc) Handheld (eg trimmers)

- - - 50 50

SH2 (20 to lt50cc) - - - 50 50

SH3 (50cc or more) - - - - 72

13

The European Union is currently considering including useful life criteria and averaging and banking provisions plus it is considering introducing a Directive to further reduce emissions from diesel engines The objective of the proposal is to tighten emissions standards for engines in general non-road applications in light of technological developments and it taking into account the parallel developments for similar legislation in the United States in order to harmonise the environmental standards and to facilitate trade

Charts comparing the USA Californian and European Emission Limits are shown below

14

35 Summary of Regulations for Non Handheld Equipment

KEY TO CHARTS

USEPA CARB EU

0

10

20

30

40

50

60

70

80

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

0 to 49cc

0

10

20

30

40

50

60

70

80

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

50 to 65cc

0

2

4

6

8

10

12

14

16

18

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

100 to 224cc

0

2

4

6

8

10

12

14

16

18

20

2000

2002

2004

2006

2008

Year Model

HC

+N

Ox g

kW

-hr

225cc and over (up to 19kW)

15

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

36 Summary of Regulations for Handheld Equipment

KEY TO CHARTS

USEPA CARB EU

20 to 49cc 0 to 19cc

250 250

200

150

HC

+N

Ox g

kW

-hr

100

200

HC

+N

Ox g

kW

-hr

150

100

50 50

0 0

Year Model Year Model

50 to 65cc 66 to 80cc

160

160

140

140

120

40 40

20 20

0 0

120

HC

+N

Ox g

kW

-hr

HC

+N

Ox g

kW

-hr

100100

8080

60 60

Year Model Year Model

16

Summary of Regulations for Handheld Equipment (continued)

KEY TO CHARTS

USEPA CARB EU

0

20

40

60

80

100

120

140

160

2000

2001

2002

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

81 to 224cc

0

20

40

60

80

100

120

140

160

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

225cc and over (up to 19kW)

17

4 Australian Market for Small Engines

41 Likely compliance with overseas emissions standards

As part of this assessment an environmental profile of equipment currently on the Australian market has been developed initially based on information from manufacturersrsquo brochures and web sites and industry magazines and then confirmed through follow-up with relevant industry contacts

Each item of equipment has been assessed on its compliance with USEPA CARB or European regulations In most cases it was not possible to match models available on the Australian market with CARB lists (CARB publishes exhaust emissions data on all appliances on its web site) This was mainly due to the inconsistency of model designations and uncertainty about ldquoengine familiesrdquo

Engine characteristics and retail price were difficult to obtain Some brochures also made claims of compliance with USEPA European or CARB requirements The detailed breakdown of current equipment on the Australian market is given in Appendix 1

The majority of small engines sold in Australia are imported and many come from countries that impose emission limits The extent of imports into Australia that do not comply with the country of origin standards is not known Industry estimates that 40 of garden products are sold through importers who are not linked to manufacturers of US EPA or European certified equipment and the source of some products sold here is difficult to establish Victa is the only company producing small engines in Australia Its iconic 2-stroke lawnmower currently cannot meet overseas emission limits

Outdoor Power Equipment Association (OPEA) assisted in identifying the Australian distributors of most brands of powered garden equipment In April 2006 a survey form was sent to a total of 43 distributors representing 97 brands of equipment The survey form sought information about the engine for all petrol-fuelled garden equipment with a power not more than 19kW

Figure 2 Extract from survey form

18

Initial response to the survey was poor Despite follow-up action and efforts from the industry association at the beginning of September 2006 26 distributors had responded to the survey information and only 13 distributors provided all data necessary for benchmarking purposes This resulted in emission compliance data for about half of the estimated products on the Australian market Attempts to match Australian models with the database maintained by the Californian Air Resources Board were also of limited success due to inconsistencies in model designations between Australia and the USA and the manner in which model information is coded in the CARB database

Table 9 Summary of distributor responses

Responses status Not OPEA OPEA ALL

Number of responses 9 8 (31) 17 (40)

Response - all data 4 9 13 (30)

Response - extra time sought 3 3 (7)

Response - no petrol products 4 1 5 (12)

Response - some data 5 5 (12)

Grand Total 17 26 43 percentages may not add to 100 due to rounding

Of the 97 brands initially identified

bull 16 brands are apparently no longer sold in Australia

bull No responses were received for 29 brands

bull Partial data were received for 12 brands

bull All data was available for 30 brands

Table 10 Summary of responses by brand

Count of brands

Analysis status Not OPEA OPEA All

Missing some data 12 12

No data received 9 (27) 20 (31) 29 (30)

No longer sold 13 3 16

Response - no models to list 3 7 10

Response received (electronic form) 5 11 16

Response received (paper form) 3 2 5

Response received (spreadsheet) 9 9

All 33 64 97

A 2004 report for the NSW DEC estimated that there were about 1200 eligible garden

19

products in the Australian market The current project has obtained data for a total of 870 products or 72 of the estimated population In addition the sampling method is likely to be biased towards products with good environmental performance In these circumstances the following analysis should be regarded as indicative only

Survey results

The following tables and figures show expected compliance with European CARB or USEPA requirements based on the limited information provided by industry

Table 11 Engine type and compliance with overseas standards Count of products Engine type

Best STD 2c 4c Unknown All 1997 - US EPA I 53 32 85 (10) 200288EU 17 17 (2) 2004 - US EPA II 1 3 4 (lt1) 2004 EURO I 8 8 (1) 2005 - US EPA II 10 29 5 44 (5) 2006 - US EPA II 107 141 2 250 (29) 2006 EURO I 6 6 (1) 2007 - US EPA II 1 1 (lt1) 2007 Euro II 2 2 (lt1) None 118 90 208 (24 Unspecified 24 60 161 245 (28) All 344 358 168 870

Unknown means the type of engine is unknown (but is most likely to be 2c) Unspecified means that the status of emissions compliance was unable to be identified None means the manufacturerdistributor has indicated that the equipment does not comply with any overseas emissions standard

Figure 3 Compliance with overseas standards - all surveyed products Note Unknown in chart includes unspecified and unknown from Table 11

20

Figure 4 Compliance with overseas standards by equipment type ldquoPhase 1 equivrdquo means the engine complies with US EPA phase 1 or 200288EU ldquoPhase 2 equivrdquo means the engine complies with US EPA Phase 2 Euro I or Euro 2 ldquoUnknown means that engine cycle (stroke) was not provided

Of the 41 categories of equipment in the survey 15 had at least 10 current products Results for these categories are set out below

Figure 5 Engine type for popular categories

21

Figure 6 Compliance with overseas standards for popular categories ldquoPhase 1 equiv means the engine complies with US EPA phase 1 or 200288EU Phase 2 equiv means the engine complies with US EPA Phase 2 Euro I or Euro 2 ldquoUnknown means that engine cycle (stroke) was not provided

42 Australian Sales of Outdoor Powered Equipment

The Australian Outdoor Power Equipment Association (OPEA) whose membership represents about 80 of the manufacturersdistributors and dealers in the industry commissions regular independent industry audits of garden equipment sales (OPEA personal communications) Sales data from OPEA is shown in Table 12

22

Table 12 Sales of outdoor garden equipment 2002 and 2005-06 2005-06 2 stroke (1000)

2002 2 stroke (1000)

2005-06 4 stroke (1000)

2002 4 stroke (1000)

2005-06 TOTAL (1000)

2002 TOTAL (1000)

Walk behind mowers 72 170 351 76 424 246

Brushcuttertrimmer 321 12 17 180 339 192

Chainsaws 152 0 0 90 152 90

Chipper shredders 0 60 46 0 46 60

Blowerblower vacuums 98 0 11 50 109 50

Ride on mowers 0 25 51 0 51 25

Generators 11 32 96 0 107 32

Hedge trimmers ampothers 40 192 0 28 40 220

694 491 476 424 1267 915

for total sales 593 463 407 537

for mowers 152 280 848 720

According to OPEA approximately 424000 walk behind lawnmowers and more than 792000 units of outdoor handheld equipment were sold in Australia in 2005-06 In addition there were sales of about 80000 replacement engines and 70000 pumps in 2005-06 most of which were four strokes These figures show that there has been considerable growth in the sales of most products with the exception of chipper shredders and the category lsquohedge trimmers and othersrsquo whose sales declined in 2005shy06 compared with those in 2002 About 17 of walk behind lawnmowers were two stroke and 83 four stroke which is an improvement in the uptake of cleaner engines when compared to 2002 when about 30 were two stroke The situation with handheld equipment is reverse with nearly 79 being two strokes compared to 47 in 2002 However many models of two stroke handheld equipment meet current US emission standards and care should be exercised in using engine type (two stroke or four stroke) as an indicator of emissions performance for this class of equipment

The OPEA 2005-06 sales estimates are shown in Figure 7 OPEA cautions that there is considerable uncertainty about the estimates for brushcutters and blowerblower vacuums as OPEArsquos figures only represent 50 and 60 respectively of sales of these products No estimates of future sales trends were identified during research for this project

23

Australian sales of 2 and 4 stroke outdoor equipment 2005-6

0 50 100 150 200 250 300 350 400

Walk behind mowers

Brushcuttertrimmer

Chainsaws

Chipper shredders

Blowerblower vacuums

Ride on mowers

Generators

Other

Annual sales (x 1000)

4s 2s

Figure 7 OPEA estimates of equipment sales in 2005-06 Note Blowervac is an industry term for equipment that combines blowing and vacuuming functions

Briggs and Stratton (Australia) who import engines from the USA supply the majority of the four stroke engines for handheld equipment sold in Australia and these comply with all the current USA and CARB regulations Imported handheld garden equipment is shipped fully assembled to a branch or distributor and is then sent to a retailer The retailer may or may not provide equipment servicing

OPEA members have expressed concern regarding the increasing sales of imported high polluting two stroke engines that allegedly do not meet any emission standards and come from countries that do not have emission standards One industry representative reported that some of the imported trimmers were being manufactured in China using outdated designs and tooling from two old bankrupt American companies and these are being sold here at about 30 of the price of traditional brands and very low cost generators from China now account for around 70 of total sales It is difficult to confirm this trend without undertaking a detailed examination of Australian import data however the significant increase in the sales of two stroke handheld equipment provides some support for this trend

On the other hand it is claimed by industry that the ride on mower market (predominately with compliant four stroke engines) has been stimulated by the Australian USA free trade agreement

24

5 Australian Users of Small Engines This section examines the market segments for garden equipment and customer purchasing behaviour

51 General Public

Purchasing behaviour

Research into consumer purchasing behaviour has found that consumers assess a product against a range of attributes for example price weight brand reputation servicing and parts availability warrantees and guarantees experience size promotions and discounts Studies have also revealed that up to 82 of Australians had bought products on the basis of social or environmental factors in the previous year (State Chamber of Commerce 2001) Related to this point the energy star rating ecolabel on whitegoods was viewed as a credible environmental claims system which is well regarded by the general consumer (Product Category Manager Mitre 10 personal communications)

As the purchase of small engine garden equipment by the general consumer is an infrequent purchase which carries a certain of amount of risk With small engines the risk can be functional risk (will not perform as expected) physical risk (for example safe features such automatic cut out on an electric lawn mower) or financial risk especially for the more expensive items The general consumer is likely to lessen the risk by seeking information and by evaluating the information on the available products over a period of time The consumer may also lessen the risk by

bull purchasing well known brands

bull buying the brand offering the best warrantees and guarantees

bull buying the most expensive brand and

bull buying a brand they have used before

Research indicates that the desired attributes of a product may not be well established at the start of a consumerrsquos search process but will often be refined as the consumer learns more about the product The consumer will also use a ranking and weighting process based on desired qualities and trade offs may be made

Reportedly purchases of engine operated garden equipment are based on price yard size fitness for purpose and other features such as weight and ease of starting (Product Category Manager Mitre 10 personal communications) Males are the predominant purchasers of garden equipment however because of changing demographics there has been an increase in the number of women purchasing these products

Less than 5 of lawnmowers purchased are push or electric mowers (Product Category Manager Mitre 10 and industry sources personal communications 2003)

25

Electric mowers are generally perceived as not being as effective as cords have limited range and rechargeable electric mowers require frequent recharging

There is a recent trend towards ride on mowers (all four strokes) probably because of changing demographics specifically older age groups moving to more rural environments with larger yards (OPEA personal communications)

A study (Wilkie 1994) investigated consumer appliance purchasing behaviour and found that the general consumer consulted a range of information sources before purchasing an appliance The appliance salesperson was found to be the most important information source for many consumers Other important information sources include newspaper advertisements friends and relatives catalogues consumer reports and brochureslabels Since Wilkiersquos study the internet will have become increasingly important as a research tool and in some instances as a way to purchase products As part of this study there is evidence of low priced products being sold into the Australian market via the internet only ndash a practice that is likely to increase in the future It was difficult to source any compliance or details on these products

At the retail chain level staff product training is generally voluntary undertaken out of store hours and as an inducement to attend training sessions suppliers usually provide incentives for staff Retail chain purchases are very price driven although some chains are reportedly interested in stocking goods that have credible environmental claims (Mitre 10 and other retail chain sources)

IBIS (2006a) reports that the domestic hardware sector which is dominated by Danks (Home Timber and Hardware Thrifty - Link Hardware and Plants Plus Garden Centre) and Bunnings is classified as a growth market and the sales of lawnmowers and other lawn and garden machinery and equipment represent about 14 of sales revenue

In summary it appears that a range of product attributes influences consumer purchases of lawnmowers and outdoor equipment Currently there is very little information about emissions in any of the information sources a consumer is likely to consult when purchasing these products Nevertheless surveys indicate that consumers are concerned about the environment and are open to including environmental considerations into their purchase decision Educating sales staff about the air emissions from lawnmowers and outdoor equipment together with ecolabels could therefore be important methods for influencing consumers towards the purchase of cleaner products

Equipment Usage

The USA Outdoor Power Equipment Institute CARB (cited in USEPA 1998) and the USEPA (USEPA 1998) have made estimates of annual usage rates and average life spans of outdoor equipment for the general consumer user and for the commercial user Table 13 gives USA usage and lifespan range for selected items of powered equipment

26

Table 13 USA Average Usage and Lifespan of Outdoor Garden Equipment For General Consumers and Commercial Users Equipment Annual usage (Hours) Lifespan (years)

General Consumer

Walk- behind mowers 20-25 6 -7

Rear engine ride on mowers 4 6 -7

Chainsaws 7 5-9

Leaf blowers 9-12 5-9

Trimmers 10 5-9

Commercial User

Walk- behind mowers 320 27

Rear engine ride on mowers 380 38

Chainsaws 405 1-13

Leaf blowers 170-293 18-28

Trimmers 170 - 275 15-28

Discussions with members of the Australian industry confirm that Australian hours of use are likely to be similar to the American estimates although this can vary depending on location For example in tropical areas lawns are mowed more often because they grow faster in this climate The American turnover of equipment is however probably higher than here as the Australian consumer tends to keep their equipment longer and so the useful life of a mower is more likely to be on average 10 ndash12 years

52 Garden and Ground Maintenance Services

According to a recent IBIS report (2006b) the revenue for this industry in 2005-06 was $383 million and the industry outlook is lsquobrightrsquo with a predicted annual average 5 growth over the next few years The Australian customer base for garden maintenance services including for lawn mowing is

Households 55 Business 25 Government 20

The sector is reportedly a growth industry due to

bull the aging population

bull the increasing numbers of households that are time poor income rich and

bull the growing trend for professional landscaping which requires a higher level of garden maintenance

27

The main customer base for these businesses includes middle to upper socioeconomic groups the aged and people who are physically disabled Growth is predicted particularly for the franchise industry with demand from the commercialindustrialgovernment sectors (IBIS 2003) A 1999 ABS survey reported that nearly one-third of older people purchased at least one domestic service per fortnight with gardening assistance being the most common This accords with an industry estimate that about 25 of householders pay someone to mow their lawn (Jim Penman Jimrsquos Mowing personal communication) The industry is sensitive to economic conditions and weather for example the drought has slowed growth over the last few years

The garden maintenance sector is dominated by small independent operators with two major franchisers Jimrsquos Mowing and VIP VIP nationally has 600 franchises and Jimrsquos Mowing about 400 Jimrsquos Mowing reportedly mows about 15000 lawns and has 53 of the market (IBIS 2006b) As franchised lawn mowing services represents about 14 of the lawn mowing services nationally it can be estimated that approximately 280000 lawns are mowed nationally by commercial operators

Jimrsquos Mowing and VIP provide training and advice to new franchisees on equipment including proper maintenance schedules Training generally occurs before franchisees purchase their equipment Most franchisees equipment would consist of two mowers a brushcutter an air blower and possibly a hedge trimmer or chain saw Operators prefer four stroke mowers and these are used for an average eight hours per week Brushcutters are generally two strokes as are other motors (IBIS 2006b and Jim Penman personal communication)

From the above it is estimated commercial operators operate mowers for up 34 million hours per year (or 8 of the total estimated mowing hours per year) and purchase approximately 66000 lawnmowers annually (25 of purchases) The sectorrsquos purchases of brushcutters is estimated to be approximately 8000 units per year or 37 of purchases Table 13 provides US commercial userrsquos annual average hours of use and average equipment life spans ndash it would be anticipated Australian rates would be similar

The main businesses contracting to provide ground maintenance services to the corporate and government sector (including universities) are Spotlessrsquos Open Space Management Transfield and Programmed Maintenance Services all of which are diversified publicly listed companies plus the Danish owned company ISS (previously Tempo Services) (IBIS 2003 and 2006b and company websites) The type of services they provide means it is likely they would have an array of equipment and a preference for the more powerful ride-on mowers and for Class V handheld equipment

53 Government Purchasing

The way purchasing decisions are made by government or other large organizations is generally very different to the approach taken by the general household consumer

bull many of the purchases are for large quantities of goods

28

bull there are well established policies and procedures in place to guide purchasing with the purchase criteria established early in the buying process and

bull those making the purchase are likely to be more knowledgeable about the product than the average consumer and they are usually not the eventual user of the goods

Value for money fitness for purpose ability to supply and over recent years environmental aspects are likely to be important factors in the purchasing decision for Government

Local State and Commonwealth Governments have responsibility for the upkeep of public assets many of which include public open space and other outdoors areas At the State and Federal level these include schools universities sporting facilities hospitals and defence facilities These services may be outsourced individual departments may undertake maintenance and purchase their own equipment or they may purchase equipment through a central purchasing facility With the central purchasing facility these items are generally purchased under contract While there is an increase in the inclusion of environmental considerations in the selection criteria for purchasing goods and services especially under contract these considerations mainly relate to waste management and recycling criteria and not air emissions

Local councils in some states for example NSW generally take responsibility for ground maintenance within their council areas or for some smaller councils the service may be contracted to a neighbouring council In other states such as Victoria there is a trend to outsource ground maintenance contracts to commercial providers

It is unknown what proportion of total sales that direct Government purchases represent however it likely to represent a relatively small share of several percent of the overall market

In summary

bull The general household consumer represents the major market segment for garden equipment accounting for up to 90 of product sales

bull Government is likely to be relatively small direct purchaser of garden equipment

bull Commercial garden services to households purchase approximately 25 of lawnmowers per year and 37 of brushcutters

bull Large ground maintenance companies are likely to prefer larger and more powerful equipment such as ride-on mowers

29

6 Result of Stakeholder Consultation

61 Regulations

The Small Engine Expert Panel ndash Outdoor Equipment considered in depth an approach to take to improve the emissions performance of outdoor garden equipment sold in Australia Discussions were particularly focused on the growing influence of cheap high emissions imported products together with the difficulties that the local manufacturer of lawn mowers is likely to face in complying with the relevant overseas standards As part of this process the industry representatives on the Panel held additional discussions and they consulted international industry experts at the manufacturing level in Europe the USA and Japan

OPEArsquos preference is for the adoption of regulations based on the USEPA standards with Phase 1 being adopted possibly from as early as 2007-08 The industry then proposes that Phase 2 be introduced in 2012 Phase 1 USA EPA standards were adopted in the USA in 1995 to be applied to equipment manufactured from 1997 and Phase 2 standards were introduced in 2002 through to 2007 and these included averaging banking and trading provisions A comparison between the USA Phase 1 and Phase2 standards is given in Table 14 The USEPA is discussing Phase 3 limits for the adoption in 20102011 which includes tighter exhaust emission limits for non-handheld equipment

The emissions limit of the two stroke lawn mower manufactured by the sole Australian manufacturer are well above USA Phase 1 limit for non-handheld equipment One avenue to address this issue which was supported by the Expert Panel ndash Outdoor Equipment would be to place lawn mowers in the US EPA Category 5 (engines gt50cc) This would result in emissions for two stroke lawnmowers being limited to 161 gkW-hour HC + NOx compared to the USA regulated limit of 161 gkW-hour HC + NOx Doing this would align the ramp-up timetable for mowers with that of other garden products

Table 14 Comparison between the USA Phase 1 and Phase 2 standards

Emission Limits GkW-hr

Phase 1 (1997 ndash2001) Phase 2 (2007) HC NOx HC+NOx CO HC+NOx CO

Non-handheld I-A lt66cc 161 610 I-B 66-lt100cc 161 610 I 100-225 cm3 161 519 161 610 II 225 cm3 134 519 121 610 Handheld III lt20 cm3 295 536 805 50 805 IV 20-50 cm3 241 536 805 50 805 V 50 cm3 161 536 603 72 603

Phase 2 limits were phased in between 2002 -2007 during which time they became tighter for simplicity only the 2007 are shown in this table (see Table 2 for more details)

30

In addition to limiting emissions the Expert Panel support the inclusion of the durability criteria which apply in the USA under Phase 2 standards and certification documentation from either the USA or Europe as adequate proof of conformity Equipment that has not been tested and certified to USA or European standards will be required to have the engines tested in a NATA certified laboratory

Some in the industry argued that regulations should include provisions for averaging for companies that wish to use it however they felt banking and trading provisions would not be necessary Industry representatives were not supportive of any Australian consumer labeling requirement instead OPEA members are willing to supply emissions data for inclusion in a web-based database that would allow purchasers to assess the environmental credentials of different makes and models

62 Discussion on recommended regulations

Timing of introduction

Some industry representatives argue that introduction of Phase 1 standards in 2007-08 will not give the industry an adequate transition period in which to develop competence in emissions certification establish new procedures and tooling in the dealers workshops train dealers and technicians on legal requirements distribute specific tooling and spare parts and reduce stocks of old (non certified) products without incurring an undue financial burden While others in the industry prefer progressing straight to phase 2 standards

If the OPEA preference for the adoption of the United States Phase 1 regulations which operated in the USA between 1995 and 2001 were introduced in Australia in 2007-08 they would be well behind the USA standards and worldrsquos best practice Furthermore the introduction of the United States Phase 2 - 2007 limits in Australia in 2012 would if the USEPA introduce Phase 3 in 2010-11 see emission limits for lawnmowers and other non handheld garden equipment in Australia still lagging United States standards and worldrsquos best practice

To introduce regulations in 2007-08 will require Government firstly to determine the most appropriate mechanism under which to enact the regulations draft the regulations prepare the regulatory impact assessment consult with the broader community and then finalise the regulations It is likely an Act of Parliament will be required at the Commonwealth level followed by complementary legislation at the State and Territory level It is possible for this to be achieved in less than a two year timeframe (as was the case for the Water Efficiency Labelling Scheme) However regulations that do not have a level of perceived urgency would take longer The level of importance and urgency to control emissions from small engines has yet to be debated and determined

31

Modified USEPA limits for lawnmowers

From the 183 lawn mowers identified through the market survey Victa is the main (possibly sole) provider of two stroke mowers with the other lawnmowers having cleaner four stroke engines

Victa is undertaking work to produce a cleaner product Victa estimates it would need a number of years to complete development production tooling and commercialisation of the cleaner engines In January 2007 it released a new two stroke carburettor lawnmower that has reduced engine emissions by more 30 but the combined HC and NOx emissions are still above USEPA Phase 1 limits Victa says this new engine is the outcome of four years of collaborative work by Victa and the University of Technology Sydney Victa is continuing with this research to further reduce emissions

A clause that allows exemptions to be granted as occurs in other countries could be included in the regulations however Victa argues that this would create uncertain trading conditions for the company for a period of time until an exemption were granted

Placing lawn mowers in the US EPA Category 5 (engines gt50cc) has the risk of opening the Australian market to more two stroke lawn mowers which has the greatest use of any outdoor powered equipment however it should see the continuance of the sole engine being manufactured in Australia In 1995 when it was introducing small engine emission limits the USEPA faced a similar issue with two stroke lawn mowers and used a similar approach by allowing two stroke lawn mowers to comply with the handheld standards It also specified that the number of two stroke lawnmower engines allowed to meet handheld standards would be subject to a declining annual production cap with the allowance provided by the production cap being phased out in 2003 There is also similar precedent for small engine emission limits that depend on engine type - European regulations for marine outboard motors set less stringent requirements for two stroke motors

Averaging Banking and Trading Provisions

The US EPA did not have averaging banking and trading provisions in Phase 1 and therefore all small outdoor engines were required to meet the Phase 1 limits It only introduced ABT provisions in the much more stringent Phase 2 as they would allow the most economic introduction of cleaner engines The industry claims the systems to use this provision are available and can be implemented in Australia by those who wish to use it at little cost to government

Industry claim that any supportive economic data related to averaging is sensitive and confidential It is there difficult without substantial justification by the industry to support the provision for averaging in conjunction with Phase 1 particularly given the elapsed time between the introduction of Phase 1 in the USA and their recommended introduction in Australia If there are some low volume equipment items that still cannot meet the USAEPA Phase 1 standards then these could be subjected to

32

exemptions if adequate justification can be provided (exemptions for small volumes were available under the USEPA regulations)

It was noted that for government to implement regulations a regulatory impact statement is required and this requires an assessment of the costs and benefits of the options considered with clear overall benefits shown for the preferred option Therefore if the option for manufacturers to use averaging were to be considered more information to support its inclusion would be required

Other options that could be considered to circumvent the inclusion of averaging include

i including clauses that give manufacturers the ability to apply for exemptions from the regulations for classes of equipment that have small sales volumes (these provisions are available in the USA)

ii limiting the regulation to popular types of equipment

iii using the end-of-model life provisions that have been used in the Australian Design Rules for cars In effect the end of model life provisions require new designs to comply from the implementation date but allow older models to remain on sale for a few more years This is an alternative to ABT because it facilitates earlier introduction of the regulation

iv Having a phase in period of say 2 years during which existing models can continue to be sold but new models coming on to the market must comply with the new standards At the end of the phase-in period all models must comply with the new standards This is an approach that is used when Australian Design Rules (ADRs) are introduced for motor vehicles

Consumer Information

Current Australian directions to reduce the environmental impact of consumer products favor tiered benchmarks using a lsquostarrsquo rating system (see Appendix 3 for examples such as the Mandatory Energy Efficiency Label and the Water Efficiency Labelling Scheme)

As products generally arrive in Australia assembled and packaged industry considers a mandatory requirement to label products with an Australian style star rating would impose a cost on distributors that would drive up the retail price of products Instead the OPEA members were willing to supply emissions data for inclusion in a web-based database that would allow purchasers to assess the environmental credentials of different makes and models Given the diverse nature of the industry it is unlikely a database would provide complete coverage of all products on the Australian market but inclusion in the database would indicate that the manufacturer has a commitment to environmental performance It was acknowledged in discussions that at least some Phase 2 compliant products would become available prior to 2012 and the web-based database would provide one method to promote those cleaner engines

33

In summary the Recommendations of the Expert Panel

1 Mandatory air pollutant emission standards to be introduced in Australia for all outdoor equipment (lt19kW) powered by spark-ignition engines The development of any regulation would need to be based on a formal assessment of the costs and benefits of nationally regulating 2 and 4 stroke lawn mowers and handheld power equipment which should be commenced immediately

2 Proposed standards to mirror US EPA regulations (compliance with equivalent EU regulations also acceptable)

3 Timing (subject to completion of assessment of costs and benefits)

(a) US EPA Phase 1 ndash Effective from 2007 2008

(b) US EPA Phase 2 ndash Fully implemented in 2012 (in step with 2007 USEPA limits) with phase-in period andor ABT over 2008-2012 to provide for early introduction of cleaner product

4 Walk-behind 2 stroke mowers to be included in US EPA Category 5 (gt50cc) product classifications Implementation timing to be as in Recommendation 3 above

5 All products also to be certified to relevant EPA durability categories

6 Subject to further review ABT (if included) may be phased out after 2012

34

7 The Way Forward

The optimum approach for garden equipment out engine emissions of options needs to be sustainable and cost effective This will need to be determined through a costs and benefits analysis (CBA) CBA assigns monetary values and typically assesses the impacts on the consumer on human health on the environment on industry and on government A detailed costs and benefits analysis is beyond the scope of this report however the following sections draws on available information to provide some indication of the possible costs and benefits that are associated with emissions from garden equipment engines

Air Quality Benefits

Environment Canada estimated the introduction of the regulations would result in a 44 percent reduction in combined HC+NOx emissions from small engines used in garden equipment and reduction in individual air pollutants over a 25 year period as shown in Table 15 The Canadian estimates incorporate the benefits that would accrue from the MOU signed with the industry in 2000 plus the benefits from the regulations introduced in 2003 In 2000 Canada imported around 13 million small spark-ignition engines and machines (ie a similar number to Australia) with 80 supplied by the USA

Table 15 Canadian Small Spark-Ignition Engine Emissions in Year 2025

Substance Base Case Emissions in 2025

Emissions in 2025 with Regulations

Percentage Reduction in 2025 (Regulations vs Base Case)

Criteria Air Contaminants (kilotonnes)

HC 772 410 469

NOx a 84 67 201

CO 1413 1403 07

Greenhouse Gas (kilotonnes)

CO2 2903 2645 89 Base case year 2000 (accommodating voluntary agreement) Source Canada Gazette Part II Vol 137 No 24 2003-11-19

Other Environmental Costs and Benefits

In addition to the human health benefits associated with reduced exposure to ozone there is a range of other public benefits including reduced damage to vegetation and therefore higher crop yields less damage to materials and structures particularly

35

some rubber products and improved visibility due to a reduction in smog haze Plus there are benefits associated with lower emissions of other air pollutants

To date there appears to have been little work undertaken in assigning a monetary value to these benefits as it is considered that they are likely to be small compared to human health impacts

Health Costs and Benefits

The Final Impact Assessment for the Ambient Air Quality National Environment Protection Measure (NEPC 1998) estimated that the health damage costs from exposure to ozone nationally to be in the range of $90 ndash $270 million (in 1998 dollars) This figure did not include mortality costs because of difficulty in assigning a figure to human life nor did it include costs associated with minor symptoms such as sore throat cough headache chest discomfort and eye irritation that can result from ozone exposure On the cost of ozone exposure the Impact Assessment states that lsquothe social well-being associated with potentially 6 and 20 million fewer irritating symptoms annually cannot be reliably quantified but at $1 a symptom it adds up to an appreciable amountrsquo

Since the Air NEPM Impact Assessment ozone levels in Australian urban areas have not fallen significantly but the population and medical costs have increased since then However using the above figures to make a rough estimate the contribution made by engines used in lawnmowers (ie not including other garden equipment) to the health damages cost from ozone exposure would be at a minimum $36 - $108 million not including the cost of mortality or minor symptoms As any action on these engines is likely to only remove high emission engines over a decade or more a CBA would be required to include an assessment of the proportional health benefits that would accrue from only removing the high emitters over time

Costs and Benefits to the Consumer

In 1995 the USEPA estimated that on average the cost to the engine manufacturer to install the necessary emission control technology to meet Phase 1 standards (which didnrsquot have ABT) would be approximately $US2 per engine used in nonhandheld equipment and $US350 per engine used in handheld equipment It also estimated that this would translate to sales-weighted average price increases of about $US7

The introduction of phase 2 regulations USEPA estimated would result in price increases of between $US20 and $US64 for handheld equipment depending on the equipment class (USEPA 2000) where handheld engines ranges in price from $60 to $1000 (USEPA 1995)

In addition to emission reductions the implementation of exhaust emission limits has the advantage of reducing fuel consumption and lowering operating costs to the consumer For example the USEPA estimated that for Phase 1 limits that applied between 1995 and 2001 on an average sales-weighted engine basis would decrease fuel consumption by 26 percent for non handheld equipment and a 13 percent decrease in fuel consumption for handheld equipment (USEPA 1995) Phase 2

36

(current limits) would result in a further decrease in fuel consumption of approximately 30 percent for handheld engines

When the USEPA considered the fuel savings offset and the retail price increase it estimated that the average sales-weighted lifetime increase in cost would be about $US650 per handheld engine while nonhandheld engines will realize a lifetime savings of about $US250 per engine This does not include the lifetime savings in maintenance costs which should further benefit the consumer (USEPA 1995)

Euromot (The European Association of Internal Combustion Manufacturers) claims that compliance with European minimum performance standards that do not have ABT provisions adds around 30 to the cost of some products that have had to be brought into compliance4 compared to products sold under the ABT system in the US

Costs and Benefits to Industry and Government

As there is only one local manufacturer among the 43 distributors of powered outdoor garden equipment sold in Australia and all others are importers the main costs to reduce the emissions contribution made by these engines will be associated with program administration and compliance particularly if regulations are introduced

The Productivity Commission an independent agency which is the Australian Governmentrsquos principal review and advisory body on microeconomic policy and regulation recently examined the cost effectiveness of measures to improve the energy efficiency in household appliances As part of its review lsquoThe Private Cost Effectiveness of Improving Energy Efficiencyrsquo it examined labelling programs (ie regulated tiered benchmarks) and minimum mandatory energy efficiency requirements (ie a regulated simple benchmark) While the household appliance market is considerably larger than the garden equipment market the Commissionrsquos final report contains some information that is useful for determining the approach that could be used to establish an emissions reduction scheme for garden equipment A summary of relevant sections of this report is provided in Appendix 3

The Commission identified both administration and compliance costs associated with labelling programs and minimum mandatory energy efficiency requirements as well the impacts these had on product suppliers

The Department of the Environment and Water Resources provided details to the Commission on the costs involved in administering both the labelling scheme and the minimum performance standards for energy programs The information provided showed that

bull the administration costs of the simple benchmark approach were substantially lower (less than one tenth) than for labelling and 84 per cent of administration costs were passed on to appliance purchasers with the remainder borne by governments

4 Presentation by Dr Holger Lochmann Rob Baker Axel Rauch Stihl 19 April 2006

37

bull the compliance costs for labelling are higher

bull minimum mandatory energy efficiency requirements can have a greater cost for suppliers than labelling since suppliers must adjust their model ranges to meet the MEPS levels by the given date These compliance costs are however influenced by the lsquolead inrsquo time between introduction and the implementation of the regulations

bull The increased cost to appliance purchasers of labelled appliances was about two and half times higher compared to appliances purchased under minimum mandatory energy efficiency requirements this being due to consumers voluntarily purchasing more efficient appliances

Overall the Commission considered that labels should be more actively considered as an alternative to minimum performance standards The Commissionrsquos support was based on the ability of labels to amongst other things

bull directly address ldquoa source of market failure mdash the asymmetry of information between buyers and sellers of energy-using productsrdquo

bull provide information to the consumer that is readily-accessible and easily-understood so they can help the consumer make better-informed choices

bull Have net social benefits and possibly have net benefits for consumers

bull provide a greater incentive for suppliers to sell environmentally better products

bull warn consumers through a disendorsement label that an appliance is very inefficient This approach can discourage but not prevent consumers from buying the poor performing product

71 Options to Reduce Emissions from Garden Equipment Engines

There is a range of options that could be considered for reducing emissions from engines used in outdoor garden equipment in Australia These include

1 Do nothing

2 Partnership Programs

3 Quasi regulation

4 Co-regulation

5 Regulations

In the following discussion about these options many Australian examples are mentioned Further details about these programs plus an overview are provided in Appendix 2

38

72 Option 1 ndash Do Nothing

Based on data supplied by OPEA the sales of high emitting two stroke carburettor engines as a percentage of engines used in outdoor equipment increased during the period 2002 to 2005-6 (see Table 12) from 463 to 593 and overall sales number increased by 38 during that period There is no indication that in the short to medium term that sales of equipment with two stroke carburetor engines will decrease in overall sales numbers or as a percentage of sales Therefore under the lsquodo nothingrsquo option emissions from outdoor garden equipment will continue at the same rate or perhaps based on sales figures of two stroke carburetor powered equipment at an even higher rate in the future

73 Option 2 ndash Industry - Government Partnership

In the discussion papers prepared for the NSW small engine project (2004) some examples of successful voluntary Government-Industry Partnership programs were provided The examples included were

bull the National Industry Reduction Agreement where the major newspaper and magazine publishers in Australia agreed to promote recovery and recycling of old newspapers and magazines

bull the NSW EPA-Oil Industry MOU on Summer Fuel the National Packaging Covenant (which has legislative backup) and

bull the EPA Victoriarsquos agreement with the Altona Chemical Complex

From the Australian programs reviewed it appears that the best indicators for successful partnership programs are

bull a relatively small number of firms within the industry

bull a commitment and involvement by all of the industry

bull clear program aims and objectives plus program targets and

bull a willingness by the industry to enter into a cooperative partnership with government

There are 43 identified distributors selling 97 brands of outdoor powered equipment in Australia Many of the major distributors are members of OPEA but there are many distributors who are not members It is therefore unlikely that the even the majority let alone all of the Australian distributors would commit to a industry-government partnership to reduce emissions

74 Option 3 - Quasi Regulation

Quasi regulations can take a range of forms the most usual being the establishment of a code of practice that industry endorses and implements A fundamental part of the code of practice would be emissions standards There are few examples of the use of codes of practice to limit emissions

39

Governmentrsquos role under this scenario is likely to be in assisting in the development of standards

The likelihood of this option being successful for similar reasons to the industry government partnership option is low

75 Option 4 -Co Regulation

Co-regulation is an agreement by industry and government to certain undertakings that support the uptake of cleaner products with a regulatory base It allows industry program flexibility to achieve certain negotiated targets Australian examples of coshyregulation include

bull The Green Vehicle Guide which operates through an industry government agreement where industry report test results to government in an agreed format within a certain timeframe Government manages the data and promotes the program This program is underpinned by Australian Design Rules for motor vehicles

bull The electrical appliance stand-by power program where there are agreed targets established that industry is required lsquovoluntarilyrsquo to meet failure to achieve the targets will result in regulation

bull The Packaging Covenant which is a program that allows industry the flexibility to design it own programs to reduce packaging waste and achieve certain target The Covenant is complemented by the NEPM on used packaging which specifies certain government responsibilities to support the program plus measures that will be introduced if targets are not met

Given the large number of distributors on the Australia market co-regulation for engines used in garden equipment using a similar form to the standndashby power program or the packaging program - an agreement by industry and government on a percentage reduction target for the sale of high emitting engines within a specified timeframe together with an agreement that regulation will be adopted if the target is not met ndash is also unlikely to be successful

76 Option 5 - Regulation

Regulation which requires a clear acknowledgement of a sufficient problem by Government places uniform mandatory compliance obligations on industry The costs associated with regulations are usually shared between government and industry with the development of regulations and program administration costs being borne by government with industry meeting compliance costs including emissions testing and if applicable labelling costs

It could argued that regulation should be introduced in the States or Territories where there are exceedances of the Air NEPM ozone standards However development of state based regulations for garden equipment engines emissions is unlikely as they would be incompatible with the 1992 Intergovernmental Agreement on the

40

Environment signed by the Commonwealth States and Territories and existing Commonwealth and State Government mutual recognition legislation The Intergovernmental Agreement on the Environment which underpins the development of National Environment Protection Measures obligates all jurisdictions to ensure equivalent protection from air pollution to all Australians

In addition enforcement of any state based legislation would be a key problem Under the Commonwealth Mutual Recognition Act 1992 and the Trans-Tasman Mutual Recognition Act 1997 goods that are imported into or produced in an Australian State or Territory or New Zealand that can be sold lawfully in that jurisdiction can be sold freely in a second jurisdiction even if the goods do not comply with the regulatory standards of the second jurisdiction This means non-regulated small engine products legally sold in one State could be legally sold in any other state regardless of whether emissions limits on small engines applied in that State

National regulation on the other hand would provide national consistency It would also provide the opportunity to adopt worldrsquos best practice standards and incorporate penalties for non-complying parties

Under the Australian Constitution the Commonwealth does not possess specific legislative powers in relation to the environment and heritage There are however a number of legislative powers that can support environment and heritage legislation Furthermore Commonwealth legislative powers can be used cumulatively For example the Commonwealth Parliament can make laws under section 51(20) of the Constitution with respect to ldquoforeign corporations and trading or financial corporations formed within the limits of the Commonwealthrdquo

Legislative mechanisms may also be created through the development of a National Environment Protection Measure (NEPM) that then becomes law within each jurisdiction A NEPM can accommodate flexibility of implementation where jurisdictions that have elevated ozone levels can tailor their NEPM program to their specific air quality needs An example of this flexible approach is the Diesel NEPM which has a suite of programs which can be implemented by jurisdictions

From the review of Australian regulations to reduce the environmental impacts of products and the overseas approaches to control emissions from small engines two regulatory approaches become apparent a simple benchmark or tiered benchmarks These are outlined below

Regulatory Option1 - A Simple Benchmark Approach

The most basic regulatory approach that could be taken would be to have a single emission standard (or as per the USA Europe and California a number of emission standards based on power and application) for combined HC + NOx emissions All equipment with new engines sold in Australia from the date the regulations are introduced This approach would

bull remove the all high emission engines from sale

41

bull be supported by an Australian Standard and

bull provide consumers with confidence that all products meet certain emissions standard

Regulatory Option 2 -Tiered Benchmarks

Current Australian directions to reduce the environmental impact of consumer products favour tiered benchmarks using a lsquostarrsquo rating system (see Appendix 2 for examples)

For engines used in garden equipment a tiered emissions labelling system could be based on the USEPA Phase 1 and Phase 2 standards use a system of lsquostarsrsquo to provide information to consumers about environmental performance but not limit consumer choice A tiered lsquostarrsquo system approach would

bull reward those products with more stars that meet the more stringent overseas standards

bull either operate with minimum emissions performance standards or disendorsement labels

bull be supported by a product label and possibly a web database

bull provide consumers emissions information and the option to purchase a lower emission engine

bull be supported by an Australian Standard and

bull be devised to meet worldrsquos best practice which is an overarching approach supported by Government

Table 16 summarises the main strengths and weaknesses of the above options

42

Table 16 Main Strengths and Weaknesses of Each Option

Strengths Weaknesses

Do Nothing Does not limit consumer choice Emissions contribution likely to grow No cost to government No barrier to new market entrants selling

high emitters Consumers have a wide choice of products Industry unchecked amp product dumping

likely No enforcement recourse on environmental grounds available

Partnerships Some sharing of responsibility government Slow if any reduction in high emitters

ndash industry

Potential for Government assist in Few if any companies likely to join and no advancing reductions in high emitters restrictions on non signatories Reduction targets set Below worldrsquos best practice

Quasi Regulation Similar strengths to partnership option Similar weaknesses to partnership option as

few if any companies likely to adopt code of practice

Co-Regulation Ongoing consultation between industry and Due to industry diversity targets unlikely to government recourse to regulation be met Targets set and can require new market Slow reduction in emissions entrants to achieve targets Can have implementation flexibility Emissions test standard adopted

Regulation Option 1- Simple Benchmark Worldrsquos best practice standards can be ovide incentives to manufacturers to promote low adapted and is mandatory emitters

Recourse to legal action available for non Does not provide consumers with emissions compliance information Significant quantifiable health benefits Cost of enforcement borne by taxpayers Requires compliance by all industry and High cost to government bans high emitters

Regulation Option 2 ndash Tiered Benchmarks Provides consumers with emissions information but does not limit choice Incentives for manufacturers to sell low emitters Potentially significant quantifiable health benefits Can be designed to overcome ABT issue

Significant administration and compliance costs to Government High cost to government and industry and will increase retail price of engines Does not ban high emitters

43

77 Preferred Approach

From the above discussion and from the review of garden equipment on available to the Australian consumer there are many companies selling powered garden equipment on the Australian market and the market is very competitive Furthermore from the Expert Panel discussions and stakeholder consultation it is apparent that it is highly unlikely that all the companies in the garden equipment industry would engage in or commit to a voluntary program to reduce their productsrsquo exhaust emissions It is therefore clear that the only feasible path to reduce emissions from these small engines is through regulation

While regulations of emissions from small engines used in garden equipment in Australia are likely to be based on overseas regulations they need to strike a balance between improved environmental outcome harmonisation with international standards and the characteristics of the local industry With regulation optimum emissions reductions are achievable especially by combining minimum emissions standards with tiered product labelling Whether this approach is justifiable on economic grounds that is the benefits outweigh the costs can only be determined through a detailed impact assessment Based on these findings it is recommended that a formal assessment of the costs and benefits of nationally regulating 2 and 4 stroke lawn mowers and handheld power equipment should now be commenced

44

References Air Resources Board California Environmental Protection Agency Californian Exhaust Emission Standards and Test Procedures for 2005 and Later Small Off-road Engines July 26 2004

Artcraft 2003 A Major Research-Based Review and Scoping of Future Directions for Appliance Efficiency Labels in Australia and NZ prepared for the Australian Greenhouse Office viewed at wwwenergyratinggovaulibraryindexhtml

Australian Bureau of Statistics 1999 Older People Australia A Social Report Report Number 41090 December 1999

Australian Greenhouse Office 2002 Achievements 2002 National Appliance equipment energy efficiency program Commonwealth of Australia

Australian Greenhouse Office 2002 Achievements 2002 National Appliance equipment energy efficiency program Commonwealth of Australia

AustralianNew Zealand StandardtradeASNZS 64002005 Water efficient productsmdashRating and labeling Federal Register of Legislative Instruments F2005L01571

Bei L T and Widdows R1999 Product knowledge and product involvement as moderators of the effects of information on purchase decisions a case study using the perfect information frontier approach Journal of Consumer Affairs 33(1) 165-186

Buy Recycled Busines Alliance Briefing Paper Environmental Claims And Labelling Abstract lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10-2003

California Code of Regulations 1998 Final Regulation Order Article 1 and Article 3 Chapter 9 Division 3 Title 13 Attachment 1 26 March 1998 wwwarbcagovregactsoreregs_finpdf

Canada Gazette Part II Vol 137 No 24 2003-11-19

Canadian Gazette 29 March 2003 Vol 137 No 13 Part 1 pp 935- 955

Cap Gemini Ernst amp Young (2001) Cars Online 2001 Global consumer survey httpa593gakamainet75931951a8b278a28319eawwwcgeycomhightechautomediaC ars_online2pdf

Clothes Washers Australiarsquos Standby Power Strategy 2002 ndash 2012 Standby Product Profile 200308 October 2003 wwwenergyratinggovau

Craig ndash Lees M Joy Sally Browne B 1995 Consumer Behaviour John Wiley amp Sons Queensland 1995

Department of Environment and Conservation NSW 2004 Measures to Encourage the Supply and Uptake of Cleaner Lawnmowers and Outdoor Handheld Equipment

45

Department of Environment and Conservation 2003 Who cares about the environment in 2003 A survey of NSW peoplersquos environmental knowledge attitudes and behaviours DEC Social Research Series

Department of Environment and Conservation Action for Air update 2006

Department of Environment and Conservation The Buy Recycled Guide Online Directory viewed at wwwresourcenswgovauindex-RNSWhtm

EcoRecycle 2004 Paint Take-Back Takes Off in Bayswater Media release 24 March 2004 viewed at wwwecorecyclevicgovau May 2004

Enviromower viewed at wwwenviromowercomau June 2004

Environment Canada 2000 Future Canadian Emission Standards for Vehicles and Engines and Standards for Reformulation of Petroleum Based Fuels Discussion Paper in Advance Notice of Intent by the Federal Minister of the Environment April 2000 wwwecgccaenergfuelsreportsfuture_fuelsfuture_fuels1_ehtm

Environment Canada 2004 Environment Minister Urges Canadians to Reduce Greenhouse Gas Emissions and Mow Down Pollution With Unique Incentive Program Media Release April 23 2004 viewed at wwwecgccamediaroomnewsrelease May 2004

Environment Protection and Heritage Council National Environment Protection (Ambient Air Quality) Measure Report on the Preliminary Work for the Review of the Ozone Standard October 2005

Environment Protection Authority 2006 Victoriarsquos Air Quality ndash 2005 Publication 1044 June 2006 wwwepavicgovau

Environmental Choice NZ 2001 Public Good and Environmental Labelling An Internal Background Paper

European Commission Directive 200344EC amending the recreational craft directive and comments to the directive combined 211005

George Wilkenfeld and Associates Pty Ltd with Artcraft Research and Energy Efficient Strategies Tomorrow Today 2003 Final Report A Mandatory Water Efficiency Labelling Scheme for Australia Prepared for Environment Australia June 2003

George Wilkenfeld and Associates 2003 A National Strategy for Consumer Product Resource Labelling in Australia prepared for the Australian Greenhouse Office December 2003 viewed at wwwenergyratinggovaulibraryindexhtml

Green Vehicle Guide wwwgreenvehicleguidegovau

Harrington L and Holt S 2002 Matching Worldrsquos Best Regulated Efficiency Standards ndash Australiarsquos success in adopting new refrigerator MEPS wwwenergyratinggovaulibrarypubsaceee-2002apdf

46

Harris J and Cole A 2003 The role for government in ecolabelling ndash on the scenes or behind the scenes lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10-2003

Holt S and Harrington L2003 Lessons learnt from Australiarsquos standards and labeling program Paper presented at ECEEE Summer Study - 2-6 June 2003 wwwenergyratinggovaulibraryindexhtml

IBIS 2006a Domestic Hardware Retailing 09-Jun-2006 Industry Code G523b

IBIS 2006b Gardening Services 18-Jan-2006 Industry Code Q9525

IBIS 2003 Gardening Services in Australia 23 December 2003 Industry Code Q9525

Lawrence K Zeise K amp Morgan P 2005 Management Options for Non-Road Engine Emissions in Urban Areas Consultancy report for Department for Environment amp Heritage Canberra

Motor Vehicle Environment Committee (MVEC) in consultation with the Department of Transport and Regional Services 2002 Proposal for an Australian ldquoGreen Vehiclesrdquo Guide viewed at httpwwwdotarsgovaumvegreen_vehicles_guidedoc May 2004

National Appliance and Equipment Energy Efficiency Committee The Energy Label at wwwenergyratinggovau (3504)

National Environment Protection Council 2005 National Environment Protection (Ambient Air Quality) Measure Report on the Preliminary Work for the Review of the Ozone Standard October 2005

National Environment Protection Council 1998 Final Impact Assessment for Ambient Air Quality National Environment Protection Measure June 1998

National Environment Protection Council 1999 Used Packaging Materials Impact Statement for the Draft NEPM Used Packaging Material January 1999 viewed at wwwephcgovau

National Environment Protection Council 2004 National Environment Protection (Air Toxics) Measure April 2004 viewed at wwwephcgovau

New South Wales Government 2002 Protection of the Environment Operations (Clean Air) Regulation 2002

New South Wales Government 1999 NSW Government Procurement Policy Statement White Paper 1999

Nordic Council 2002 Ecolabelling of marine Engines Criteria Document 8 December 1995 ndash 6 December 2005 version 35 December 2002

47

Office of Public Sector Information Statutory Instrument 2004 No 2034 The Non-Road Mobile Machinery (Emission of Gaseous and Particulate Pollutants) (Amendment) Regulations 2004 wwwopsigovuksisi200420042034htm

Outdoor Power Equipment Institute 2001 Profile of the Outdoor Power Equipment Industry wwwopeiorg

Productivity Commission 2004 The Private Cost Effectiveness of Improving Energy Efficiency Final report October 2005 wwwpcgovauinquiryenergy

Publishers National Environment Bureau Media Release lsquoAustralia leads the world in newspaper recyclingrsquo 6 June 2006 wwwpnebcomau

Real J Jones A 2005 The Green Vehicle Guide Clean Air Soceity of Australia and New Zealand Conference 2005 Hobart

Salmon G Voluntary Sustainability Standards and Labels (VSSLs) The Case for Fostering Them OECD Round Table On Sustainable Development

Schkade D A and Kelinmutz D N 1994 Information displays and choice processes differential effects of organization form and sequence Organizational Behavior and Human Decision Processes 57(3) 319-337

Stephens A 2003 Eco Buy (Local Government Buy Recycled Alliance Victoria) Abstract lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10shy2003

Teisl M F Roe B and Hicks RL 2002 Can eco-labels fine tune a market Evidence from dolphin-safe labeling Journal of Environmental Economics and Management 43339-359

Teisl M F Roe B and Levy A S Ecolabelling What does consumer science tell us about which strategies work pp141-150

The ISO 14000 family of standards guides and technical reports

The Parliament of the Commonwealth of Australia 2004 House of Representatives Water Efficiency Labelling and Standards Bill 2004 Explanatory Memorandum wwwcomlawgovauComLawLegislationBills1nsf viewed February 2006

Thogerson J 2000 Promoting green consumer behaviour with eco-labels Workshop on Education Information and Voluntary Measures in Environmental Protection National Academy of Sciences ndashNational Research Council Washington DC November 29-30

United States Environmental Protection Agency Federal Register Vol 60 No 127 3 July 1995 Control of Air Pollution Emission Standards for New Nonroad Spark-ignition Engines At or Below 19 Kilowatts wwwepagovEPA-AIR1995JulyDay-03prshy805txthtml

48

United States Environmental Protection Agency Federal Register Vol 69 No 7 12 January 2004 Rules and Regulations 40 CFR Part 90 Amendments to the Phase 2 Requirements for Spark-Ignition Nonroad Engines at or Below 19 Kilowatts Direct Final Rule and Proposed Rule wwwepagovfedrgstrEPA-AIR2004JanuaryDay-12a458pdf

United States Environmental Protection Agency Office of Pollution Prevention and Toxics Pollution Prevention Division 1998 Ecolabelling Environmental Labelling - A Comprehensive Review of Issues Policies and Practices Worldwide

United States Environmental Protection Agency Office of Transportation and Air Quality March 2000 Regulatory Announcement Final Phase 2 Standards for Spark-Ignition Handheld Engines

United States Environmental Protection Agency 1998 Proposed Phase 2 Emission Standards for Small SI Engines 27 January 1998

United States Environmental Protection Agency 2000 Regulatory announcement Final Phase 2 Standards for Small Spark-Ignition Handheld Engines March 2000 EPA420-F-00shy007

United States Federal Register Vol 69 No 7 Monday January 12 2004 Rules and Regulations Environmental Protection Agency 40 CFR Part 90 Amendments to the Phase 2 Requirements for Spark-Ignition Nonroad Engines at or Below 19 Kilowatts Direct Final Rule and Proposed Rule United States Federal Register Vol 64 No 60 30 March 1999 40 CFR Part 90 Phase 2 Emission Standards for New Nonroad Spark-Ignition Nonhandheld Engines At or Below 19 Kilowatts Final Rule pp15214-15216

United States Federal Register Vol 65 No 80 25 April 2000 40 CFR Parts 90 and 91 Phase 2 Emission Standards for New Nonroad Spark-Ignition Handheld Engines at or Below 19 Kilowatts and Minor Amendments to Emission Requirements Applicable to Small Spark-Ignition Engines and Marine Spark-Ignition Engines Final Rule pp24282-24284

United States Environmental Protection Agency Control of Air Pollution Emission for New Nonroad Spark-ignition Engines At or Below 19 Kilowatts Final Rule 40 CFR Parts 9 and 90 1995 wwwepagovEPA-AIR1995JulyDay-03pr-805txthtml

United States Environmental Protection Agency Office of Pollution Prevention and Toxics Pollution Prevention Division 1998 Ecolabelling Environmental Labeling- A Comprehensive Review of Issues Policies and Practices Worldwide

Victorian Government Greenhouse Strategy Community Action Fund - Mow Down Lawn Mower Rebate Exchange Program wwwgreenhousevicgovaucommunitygrantscafsuccessfulprojectshtm

Water Efficiency Labelling and Standards Act 2005 No 4 wwwcomlawgovauComLawLegislation

49

Water Efficiency Labelling and Standards Determination 2005 wwwcomlawgovauComLawLegislationLegislativeInstrument1nsf

Water Efficiency Labelling and Standards Regulations 2005 wwwcomlawgovauComLawLegislationLegislativeInstrument1nsf

Wilkie W 1994 Consumer Behaviour John Wiley and Sons NY as cited in Craig ndash Lees M Joy Sally Browne B 1995 Consumer Behaviour John Wiley amp Sons Queensland 1995

wwwenergyratinggovau

wwwgreenvehicleguidegovau

wwwwaterratinggovau

50

Appendix 1 Detailed Breakdown of Powered Garden Equipment on the Australian Market

The following table gives a profile of the current equipment on the Australian market It is based mostly on distributor responses to a survey and might not be representative of the total market

Low sales indicates that no sales data was available but volumes are likely to be small compared with popular equipment Phase 1 is US EPA Phase 1 or EU Directive 200288EU Phase 2 is US EPA Phase 2 or Euro standards

Type Ranges Stroke Aerator 5 makes 6 models Sales Low

Engine power 26 to 172kW Engine displ 143-674 ml

2c -4c 5 Unspecified 1 Phase 1 - Phase 2 4

Auger 3 makes 5 models Sales Low

Engine power 12 to 16kW Engine displ 31-ml

2c 5 4c -Unspecified -Phase 1 1 Phase 2 1

Backhoe 0 makes 0 model Sales Low

(2 models in 2003) -

Blower 13 makes 49 models Sales 109K

Engine power 07 to 31kW Engine displ 24-80ml

2c 34 4c 2 Unspecified 13 Phase 1 10 Phase 2 17

Blower-wheeler 3 makes 6 models

Engine power 07 to97kW Engine displ 24-305ml

2c 1 4c 4 Unspecified 1 Phase 1 3 Phase 2 -

Blowervac 6 makes 9 models Sales

Engine power 07 to 11kW Engine displ 24-34ml

2c 6 4c -Unspecified 3 Phase 1- Phase 2 3

Brush cutter 12 makes 95 models Sales 339K

Engine power 06 to 23kW Engine displ 21-54ml

2c 66 4c 5 Unspecified 24 Phase 1 15 Phase 2 34

Chainsaw 9 makes 106 models Sales 152K

Engine power 1 to 58kW Engine displ 26-122ml

2c 74 4c -Unspecified 32 Phase 1 18 Phase 2 27

Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

51

Type Ranges Stroke Clearing saw Engine power 14 to 27kW 2c 6 3 makes Engine displ 36-57ml 4c 0 9 models Unspecified 3 Sales low Phase 1 4 Phase 2 -Cultivator Engine power 07 to 52kW 2c 2 4 makes Engine displ 25-190ml 4c 5 7 models Unspecified -Sales low Phase 1 - Phase 2 5 De-thatcher Engine power 1kW 2c 1 1 makes Engine displ 27ml 4c -1 models Unspecified -Sales low Phase 1 - Phase 2 1 Drill Engine power 1kW 2c 3 3 makes Engine displ 27ml 4c -4 models Unspecified 1 Sales low Phase 1 - Phase 2 1 Edger Engine power 1 to 4kW 2c 12 10 makes Engine displ 24-190ml 4c 11 36 models Unspecified 1 Sales Phase 1 3 Phase 2 22 Garden tractor Engine power 12 to 157kW 2c -2 makes Engine displ 465 to 675ml 4c 5 12 models Unspecified 9 Sales low Phase 1 - Phase 2 3 Grass trimmer Engine power- 2c 3 1 make Engine displ 31ml 4c -3 model Unspecified -Sales Phase 1 - Phase 2 3 Hedge trimmer Engine power 06 to 1kW 2c 28 10 makes Engine displ 21-31ml 4c 1 42 models Unspecified 13 Sales 40K Phase 1 4 Phase 2 35 Lawnmower Engine power 26 to 66kW 2c 22 19 makes Engine displ 100-270ml 4c 151 183 models Price $449-$3609 Unspecified 10 Sales 424K Phase 1 95 Phase 2 48 Line trimmer Engine power 07 to 45kW 2c 25 8 makes Engine displ 24-195ml 4c 2 29 models Price $136-$299 Unspecified 2 Sales Phase 1 2 Phase 2 6 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

52

Type Ranges Stroke Log splitter Engine power 26 to 45kW 2c -1 makes Engine displ 100-195ml 4c 2 2 models Unspecified -Sales low Phase 1 - Phase 2 1 Multicutter Engine power 08 to 14kW 2c 17 5 makes Engine displ 23-36ml 4c 1 19 model Unspecified 1 Sales Phase 1 2 Phase 2 13 Olive nut shaker Engine power - 2c -1 make Engine displ - 4c -1 model Unspecified 1

Phase 1 - Phase 2 -Pole saw Engine power 08 to 14kW 2c 6 4 makes Engine displ 23-36ml 4c -10 models Unspecified 4 Sales low Phase 1 1 Phase 2 3 Power carrier Engine power 37 to 231kW 2c -2 makes Engine displ 160 to 953ml 4c 11 11 models Unspecified -Sales low Phase 1 - Phase 2 10 Power cutter Engine power 32 to 45kW 2c 5 2 makes Engine displ 64-99ml 4c -8 models Unspecified 3 Sales low Phase 1 1 Phase 2 3 Pruner (3 models in 2003) 2c -0 make 4c -0 models Unspecified -Sales low Ride-on-mower Engine power 26 to 231kW 2c -12 makes Engine displ 100 to 725ml 4c 93 124 models Unspecified81 Sales 51K Ph1 1 Ph2106 Rotary hoe (4 models in 2003) 2c -0 makes 4c -0 models Unspecified -Sales low Shredder Engine power 3 to 96kW 2c 1 6 makes Engine displ 126-389ml 4c 16 20 models Unspecified 3 Sales 46K Phase 1 - Phase 2 4 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

53

Type Ranges Stroke Stump grinder Engine power 96kW 2c -1 make Engine displ 389ml 4c 1 1 model Unspecified -Sales low Phase 1 - Phase 2 1 Tiller Engine power 08 to 59kW 2c -3 makes Engine displ 25-243ml 4c 8 9 models Unspecified 1 Sales low Phase 1 - Phase 2 7 Trencher Engine power37kW 2c -1 makes Engine displ 183ml 4c -1 models Unspecified 1 Sales low Phase 1 - Phase 2 1 Trimmer Engine power - 2c 10 2 makes Engine displ - 4c -21 models Price - Unspecified 11 Sales Phase 1 4 Phase 2 -Turfcutter Engine power 37kW 2c -1 makes Engine displ - 4c 1 1 models Unspecified -Sales low Phase 1 - Phase 2 -Vac Engine power 22 to 172kW 2c 1 5 makes Engine displ 158 to 674ml 4c 13 15 models Unspecified 1 Sales Ph11 Ph24 Vac chipper Engine power 34 to 45kW 2c -2 makes Engine displ 158-195ml 4c 3 3 models Unspecified -Sales low Phase 1 - Phase 2 1 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

54

Appendix 2 Examples of Current Australian Benchmarking Programs

The following describes in varying degrees of detail a number of current Australian benchmarking schemes classified by program type simple bench mark approaches tiered benchmarks and government industry partnerships This appendix concludes with a summary table of these programs with an assessment of their effectiveness

1 Introduction

Simple benchmark schemes (described below) such as the woodheater standards set a single point hurdle rate whereas the green vehicle guide use tiered benchmarks The new water efficiency labelling scheme and minimum energy efficiency performance standards uses both a simple benchmark through minimum performance requirement plus tiered benchmarks incorporated into labels as lsquostarsrsquo Other approaches such as the stand-by power program and the Victorian Altona Complex VOC reduction target set goals for achievement within a specified time period Other approaches taken to reduce environmental impacts include the National Packaging Covenant which uses a program based on individual companies developing tailored approaches to suit their circumstances and is supported by enforcement capability through the National Environment Protection (Used Packaging Materials) Measure (the NEPM)

2 Simple Benchmarks

21 Minimum Energy Performance Standards (MEPS)

Purpose

MEPS prescribe a minimum allowed energy performance for specific appliances Appliances that are less efficient than the relevant standard are excluded from the market

Background and Strategy

In October 1999 as part of the National Greenhouse Strategy (1998) nationally consistent MEPS and labelling schemes were adopted across Australia

Independent NATA accredited laboratories undertake product compliance checks to see whether products perform in compliance with MEPS requirements For example

bull In 2003 the government conducted check tests on eight appliance models all of which were found not to meet the claims made on the energy performance labels Two products were deregistered one was found to have not been registered and action was pending on the remaining five products (AGO 2003b)

55

bull Other regulatory actions undertaken in 2003 included fines of $3000 and $8000 against two Western Australian retailers who were found to have sold appliances without energy performance labels Queensland and Victorian retailers received infringement notices and fines totalling $10 000 (AGO 2003b)

Summary RegulNated minimum performance standards based on an Australian Standard

22 Energy Star

Purpose

An endorsement label that indicates an electronic product has achieved a specified standard when it is not performing its core function (ie on stand by)

Background and Strategy

Energy Star is a voluntary endorsement labelling program developed by the US Environmental Protection Agency (US EPA) It has been operating in the USA since 1992 and has been adopted by a number of countries including Australia Energy Star sets voluntary standards for reducing the electricity consumption of electronic equipment when it is not performing its core function

The Government stand ndash by program which is outlined below complements the energy star labelling program

Summary Voluntary endorsement label

23 Woodheater Standards

Purpose

To reduce particle emissions through Australian Standard compliant woodheaters

Background and Strategy

Since 1992 Australian StandardNew Zealand Standards have been introduced to improve the performance of wood heaters

The first standard for wood heater emissions AS4013 (1992) was published in 1992 and was revised and published as a joint AustralianNew Zealand Standard in 1999 ASNZS4013 (1999) Domestic solid fuel burning appliances - Method for determination of flue gas emission This Standard provides a test method to measure particles emitted by residential solid-fuel burning heating appliances

56

The 1992 Standard included an upper limit for acceptable particle emissions of 55 grams of particles per kilogram (oven-dry weight) of fuel burnt This emission factor was reduced to 4 gkg in the 1999 revision of the Standard The Standard applies to solid-fuel burning space-heating appliances (including those fitted with water heating devices) with a heat output of 25KW or less It does not apply to masonry fireplaces cooking stoves central heating appliances or water-heating-only appliances

AS 4013 (1999) is complemented by ASNZS4014 (1999) Domestic solid fuel burning appliances - Test Fuels and ASNZS4012 (1999) Domestic solid fuel burning appliances - Method for determination of power output and efficiency

The woodheater industry was instrumental in initiating the development of standards and it lobbied states and territories to enact legislation to mandating that woodheaters be required to meet the standards As the health affects of particle pollution have become more apparent and as some jurisdictions are having difficulty in meeting national particle standards Government has become more proactive in controlling woodheaters and more supportive of tighter standards

All states and territories with the exception of South Australia have regulations that restrict emissions from new woodheaters although Victoria for example only introduced its regulations in 2004 compared to Tasmania who introduced regulations in 1993 These regulations require that new woodheaters comply with the Australian Standard ASNZS 4013 The State regulations however are not uniform

Many woodheaters that are currently certified for sale do not comply with the revised standard as verified in a National Woodheater Audit Program undertaken in 2004 Seven of the 12 wood heaters tested failed to meet the ASNZS 4013 particle emission limit In addition 55 of heaters were found to have deviations from the original designs and 72 had labelling faults that could adversely affect emissions performance

Testing and certification are administered by the industry association

Summary State and regulations requiring compliance with Australian Standards Certification administered by industry association

24 Standby Power

Purpose

To reduce lsquoexcessiversquo energy consumed in electrical appliance standby mode sold in Australia through in the first instance voluntary targets Appliances covered by the program range from information technology equipment such as PCs and photocopiers entertainment equipment such as TVs DVDs and sound systems major appliances such as water heaters dishwashers and refrigerators and small appliances such as smoke detectors and bread makers

57

Background and Strategy

In 2000 standby power was estimated to constitute 116 per cent of Australiarsquos residential energy use costing households over $500 million and leading to the emission of over 5 million tonnes of carbon dioxide equivalent (AGO 2002c) Holt and Harrington (2004) estimated that standby power consumption in Australia could be reduced by 56 per cent by 2020 (Productivity Commission 2005)

In August 2000 all Australian jurisdictions agreed to pursue efficiencies in standby power consumption of energy-consuming products through support for the International Energy Agencys One -Watt program and endorse its incorporation into theprogram of work

Australia reportedly has taken the lead on implementing the One- Watt program even though many of the products sold in Australia are imported

During 2002 government agencies consulted with stakeholders about ideas to reduce standby The standby strategy which proposed a list of targeted potential product types was presented to the Ministerial Council on Energy

In September 2003 an interim test method for the measurement of standby power ASNZS 62301-2003 (int) based on an internationally recognised standard was published Also during this period work commenced on developing draft product profiles for high priority targeted products

Once product profiles are completed interim voluntary date-specific targets are made The product sales are then monitored to determine progress towards the interim target If it is then determined that inadequate progress is being achieved by a significant number of suppliers then government will regulate

For example the interim 2007 target for clothes washers is as follows

Product Off mode power End of program mode

lt 1W lt 4 W

The National Standby Strategy Target to be achieved by 2012 for clothes washers is as follows

Off mode power End of program mode lt 03 W lt 1 W

In support of the clothes washer program Government will

bull consider creating a Government Purchasing Policy to buy low standby clothes washers where available and fit for purpose

bull collect data on all modes for new clothes washers and analyse trends

bull highlight the range of performances by publishing performance data on clothes washers on a website or by other means

58

bull progressively include standby energy consumption into the Comparative Energy Consumption for labelled products such as clothes washers and clothes dryers

bull work with the Standards Committees to finalise the details of modes and test methods for the relevant standards

bull determine in 2008 if progress is inadequate and if regulation is required

Summary Industry targets possible future regulation

3 Tiered Benchmarks

31 Mandatory Energy Efficiency Label ndash the Energy Star Programs

Purpose

To enable consumers to easily compare the energy performance of electrical appliances used by households and firms through a labelling scheme

Background and Strategy

Several Australian states commenced mandatory energy efficiency labelling for major appliances in the mid-1980s In 1992 it became mandatory across Australia for initially refrigerators and later freezers clothes washers clothes dryers dishwashers and air-conditioners (single phase only) to carry the label when they are offered for sale This labelling program is regarded as one of the most successful in the world (Wilkenfeld and Assoc 2003) It is administered through the Australian Greenhouse Office

The energy rating label for dishwashers

(ldquoa joint government and industry programrdquo) and a website address (wwwenergyratinggovau) and has two main features

bull the star rating which gives a quick comparative assessment of the models energy efficiency and

bull the comparative energy consumption (usually kilowatt hoursyear) which provides an estimate of the annual energy consumption of the appliance based on the tested energy consumption and information about the typical use of the appliance in the home These values are measured under Australian Standards which define test procedures for measuring energy consumption and minimum energy performance criteria Appliances must meet these criteria before they can be granted an Energy Rating Label

The Energy Rating Label includes an endorsement

59

Awards Brand ModelInstallat

ionType

Phase Available

10 Yr Energy

Cost StarRating

Output(kW)

TOSHIBA

Digital Inverter Series Air

Conditioner RAV-SM1102BT-

ERAV-SP1102AT-E (

RAV-SM1102BT-ERAV-

SP1102AT-E)

SingleSplit

SystemDucted

Single $1500 1000

CHUNLAN

KFR-32GWVWa (

NO)

SingleSplit

SystemDucted

Single $645 323

Since its introduction the star rating label seems to have established a high level of recognition with consumers Consumer research (Artcraft 2003) indicates that the different information on the label appeals to different consumer segments interested in purchasing an appliance

When a manufacturer gains approval to use the label they pay for and produce the label in accordance with specifications on size colours fonts layout and design A similar colour scheme and design to the energy consumption label is also used for the compulsory fuel consumption label on new passenger and light commercial vehicles

The labelling scheme is underpinned by regulation whereby regulated Minimum Energy Performance Standards (MEPS) provide the environmental benchmarks that the appliances are required to meet Appliances that do not meet the minimum energy performance standards can be withdrawn from the Australian market

When the energy rating program was reviewed in 2000 technology had advanced to the point where a large percentage of appliances had achieved the maximum number of stars so the rating system was tightened It is estimated that over the 25 year period 1980 to 2005 there will have been an overall reduction in energy consumption of around 70 by the most popular sized refrigerators (with freezers) (Harrington L and Holt S 2002)

In addition to the energy consumption label there is a website (wwwenergyratinggovau) with a comprehensive database of all appliances their star rating and energy consumption In 2002 there were around 220000 hits on the programrsquos various websites and 523000 in 2003 reportedly representing 80000 visits by individual inquirers The website hit rate is estimated to represent almost 10 of consumers who are considering purchasing an appliance (Holt et al 2003)

Cooling

Energy Input (kW)

250

104

Figure B Excerpt from Energy Rating web page for Air Conditioners (cooling cycle only shown)

When the energy rating program was reviewed in 2000 technology had advanced to the point where the Scheme had to be tightened because a large percentage of appliances had achieved the maximum number of stars For example energy use by refrigerators was around 70 compared to that used when the scheme started (Harrington L and Holt S 2002)

60

Regulations

State and Territory legislation refer to the relevant Australian Standards This approach simplifies the State and Territory legislation and makes it relatively straightforward to maintain national consistency of appliance and equipment energy efficiency standards even when standards are continually being revised

The testing procedures and technical requirements for the label and also Minimum Energy Performance Standards (MEPS see below) are incorporated into the applicable Australian Standards Products for sale must be registered with one of the State regulators

Program Administration

The labelling program and MEPS program are administered by the National Appliance and Equipment Energy Efficiency Committee (NAEEEC) which is ultimately directed by the Ministerial Council on Energy

Requirements for Appliance Suppliers

Appliance suppliers are required to

bull Submit applications for product registration and these must include a test report or other data to demonstrate that the appliance meets the relevant Australian Standard

bull While test reports on three separate units are required for most products there is no particular requirement for test laboratories to be accredited or products certified for registration for energy labelling and MEPS in Australia Test reports from the manufacturers laboratory are satisfactory However if there is evidence that results from a particular laboratory are unsatisfactory regulators can mandate test reports from an accredited laboratory

Summary Mandatory labelling scheme backed by regulations and an Australian Standard

32 Water Appliances Water Efficiency Labelling and Standards (WELS) Scheme

Purpose

A labelling scheme backed by legislation to promote domestic water efficient appliances

Background and Strategy

A voluntary water efficiency industry administered labelling scheme has been in existence since 1988 The water efficiency ratings and details on the label design are covered in ASNZS 6400 The main incentive of the voluntary lsquoAAAAArsquo scheme

61

has been the publicity and cash rebates offered by water utilities However the coverage water efficiency performance requirements and impact of this program have been limited

In 2003 the Environment and Heritage Ministers agreed to implement a national Water Efficiency Labelling Scheme (WELS) for products such as shower heads washing machines dishwashers and toilets Consultation with industry and stakeholders was undertaken in 2003 with a strategic study published that identified the products to be included in the new labelling Scheme A Regulation Impact Statement (RIS) which identified the costs and benefits of various options and made various recommendations was published in March 2004 Following public review of the RIS some modifications were made to WELS

The WELS Scheme is backed by the following legislation and standard

Water Efficiency Labelling and Standards Act 2005 which establishes

bull the products subject to the Scheme and the requirements for registration and labelling

bull the standards to apply to WELS products setting requirements for water efficiency performance registration and labelling of these products

bull enforcement provisions including penalties bull the appointment of inspectors to investigate possible contraventions and sets

out their powers and obligations bull review and dispute resolution bull a program Regulator bull the making of regulations bull a requirement for annual reports and for an independent review after five years

Water Efficiency Labelling and Standards Regulations 2005 which

bull prescribes the circumstances in which a person other than the manufacturer of a WELS product may be taken to be the manufacturer of the product (eg an importer)

bull sets out procedures for the issuing and the payment of penalty infringement notices as an alternative to prosecution for offences against the WELS Act

bull specifying the information to be included on an identity card issued to a WELS inspector

Water Efficiency Labelling and Standards Determination 2005 amongst other things determines and establishes product registration fees and calls up the Australian Standard ASNZS6400 2005 Water-efficient products - Rating and labelling which

bull defines the products

bull specifies the assessment procedures (ie identifies test procedures in other Australian Standards)

bull provides the formulas to give products their star rating

bull specifies the labels and their application to products

62

Approximately twenty organisations were represented on the Standards Committee that developed the Standard

State and Territory legislation

The States and Territories have also enacted or agreed to enact complementary legislation to ensure that the WELS Scheme has comprehensive national coverage State and Territory legislation which is almost a mirror of the Commonwealthrsquos Water Efficiency Labelling and Standards Act 2005 enables the States and Territories to for example undertake certain responsibilities delegated to them by the Commonwealth Regulator appoint their own inspectors and enforce the WELS

Other features of WELS include

bull A product web database

bull With the exception of toilets no other products are required to meet mandatory water efficiency requirements (WES) but this may change over time The introduction of mandatory WES means that products not meeting the minimum performance requirements can not legally be sold

bull Products must be tested in accordance with the relevant Standard and must meet any minimum performance and water efficiency requirements in the Standard before they can be granted a WELS Water Rating label

bull It is up to manufacturers or their agents (eg importers in the case of imported products) to ensure that their products are correctly registered and labelled and comply with any other requirements of the Standard

There is a transition phase which gives manufacturers and importers time to test register and label products and to sell pre-existing stock From 1 January 2008 all products are required to display the WELS Water Rating labels irrespective of their date of supply

63

The WELS Water Rating label

Label Features

bull A star rating for a quick comparative assessment of the models water efficiency

bull Labels with 1 to 6 stars

bull Some products may also be labelled with a Zero Star Rated label which indicates that the product is either not water efficient or does not meet basic performance requirements

bull A productrsquos water consumption figure

bull There are provisions for swing tags if there is inadequate surface area for label or the item is likely to be marked by sticking the label on the product

Summary Mandated product labelling using lsquostarrsquo rating system Has a disendorsement label and has provisions to ban products

33 Gas Appliance Rating Scheme

Purpose

A gas labelling program to improve the energy efficiency of gas powered products

Background and Strategy

The Gas and Fuel Corporation of Victoria introduced energy labelling for gas water heaters in 1981 This scheme was taken over by the AGA in 1985 who in 1988 introduced a six star energy performance label This label was intended to be visually consistent with the star rating labels already familiar to consumers of electrical appliances

The labelling scheme is currently voluntary and still administered by the industry body

A range of gas appliances have been subject to minimum energy performance standards (MEPS) since the 1960s The current MEPS levels were set in 1983 and

64

Brand Model Type MjyearStar

RatingSRI

StorageCapacity

(ltrs)IndoorOutdoor

NaturalGas

Instantaneous 18969 59 I N

Instantaneous 18969 59 I N

lsquothe majority of models currently on the market appear to exceed current requirements by a comfortable marginrsquo (SEAV 2003 p 23)

The gas energy labels are similar in format to those found on electrical appliances except they are blue and show annual energy use in MJ

A trial web site listing gas water heaters available in Australia is also available (see below)

Bottle Gas

Rinnai Infinity

V Series

REU-V2632FFU-A (Infinity 26 plus internal) P

Rinnai Infinity

V Series

REU-V2632FFUC-A (HD2001 internal) P

A joint review of the scheme is under way by the Gas Industry and Governments and regulation is under consideration A three year work plan has been published under the Australian and New Zealand Appliance and Equipment Energy Efficiency Program

Summary Currently voluntary labelling using lsquostarrsquo rating system with mandatory minimum energy performance standards Future regulation is under consideration

34 Green Vehicle Guide

Purpose

To provide web-based comparable and accessible environmental data on new motor vehicles

Background and strategy

65

The Commonwealth government started publishing a booklet of fuel consumption data for new passenger and light commercial vehicles in the early 1980s and a low cost web database in more recent years

In 2004 the Government through the Department of Transport and Regional Services (DOTARS) expanded the fuel consumption guide into the Green Vehicle Guide The Green Vehicle Guide is a web based database that rates new passenger and light commercial vehicles on air pollution greenhouse emissions and fuel consumption and gives an overall lsquostarrsquo rating for each vehicle within each vehicle category (small medium luxury sports etc)

The data on which the scores are derived are provided voluntarily by the vehicle manufacturers however this data is based on mandatory Australian Design Rule certification test data

The Guide uses a 5 star rating system however it also assigns half stars resulting in a total of 10 levels

The Greenhouse Ratings are based on carbon dioxide emissions and the Air Pollution Ratings take into account the relative environmental impact of oxides of nitrogen hydrocarbons and particles The relative harmfulness of the pollutants (shown in table below) has been quantified based on the allowable concentrations under the Ambient Air Quality National Environment Protection Measure (NEPM)

Green Vehicle Guide Weighting of Regulated Vehicle Emissions

Vehicle Emission

(equivalent pollutant under Air NEPM)

Calculated

Relative

Harmfulness

Final

Weighting

Carbon Monoxide (CO) 0088 Not included

Oxides of Nitrogen (NOx) (based on

Nitrogen Dioxide)

4 1

Hydrocarbons (HC) (based on

photochemical oxidants as ozone)

5 1

Particulate Matter (PM) (based on PM10) 20 5

Source Real and Jones 2005

NOx and HC were given equal final weightings despite the slight difference in the calculated relative harmfulness primarily because under ADR7900 a combined HC+NOx limit is prescribed rather than individual limits for each pollutant

The higher weighting for particulate matter recognises its significant health impacts The Air Pollution rating scale was devised in such a way that a lsquotypicalrsquo car (that is most petrol engined passenger cars meeting the current emission standard at the time) receives a mid-point rating (5 out of 10)

66

The overall rating or stars is derived from the sum of the air pollution and greenhouse scores ie they are equally weighted

Development of the Green Vehicle Guide (see extract below) involved extensive consultation with vehicle manufacturers

Website Costs

The new highly automated web database which contains data on approximately 1400 vehicles and has sophisticated search facilities cost approximately $200000 to develop plus around $100000 was spent recently to improve the sitersquos usability This compares to the previous low cost database which together with the printed guide cost less than about $80000 per annum The low cost version lacked the automation was only updated annually and did not have the ability to compared vehicles

The manufacturers provide the data on line using special access codes This data is checked by DOTARS before it is uploaded onto the website It takes close to a full time position within DOTARS to administer the website and respond to website related queries

Market Research and Marketing

Before the new greenvehicleguidegovau website was launched DOTARS commissioned consumer surveys to determine the level of knowledge about the environmental impacts made by vehicles This research showed that around half of those surveyed had the belief that ldquoall new cars have the same level of impact on the environmentrdquo

It became apparent through the surveys that there was a need to provide consumers with meaningful information on the relative performance of different vehicles This was a view shared by the Productivity Commission who said that while markets provide extensive information to consumers regarding fuel consumption of motor vehicles ldquothe Australian Governmentrsquos Fuel Consumption Labelling Scheme and Green Vehicle Guide provide relatively low cost accessible and comparable information to consumers and may be justified as part of the more fundamental objective of encouraging consumers to reduce the adverse environmental impacts of motor vehicle userdquo The Productivity Commission also commented that government

67

sources of information of this type were seen as credible and reliable and held in higher regard than information provided by others

DOTARS has scheduled some follow up consumer research for 200062007

DOTARS has spent about $600000 in marketing the Green Vehicle Guide This has included advertising in weekend guides in newspapers developing facts sheets plus targeted marketing to motor vehicle journalists

Summary Website - voluntary but legislative base

4 Government-Industry Partnership programs

Government-Industry Partnerships are the basis of many environmental initiatives and can take a number of forms Industry and government negotiate the terms of the program which are normally detailed in a formal agreement which sets out the environmental objectives and the responsibilities of each party towards their achievement

The GovernmentIndustry Partnership programs outlined below indicate the varied nature of these initiatives

41 The National Packaging Covenant

The National Packaging Covenant (the Covenant) commenced in 1999 and is a voluntary agreement between all levels of government and companies throughout the packaging chain including raw material suppliers packaging producers and retailers The Covenant commits signatories to the implementation of best practice environmental management in areas such as packaging design production and distribution and research into life cycle issues Signatories to the Covenant produce action plans on the measures they will implement to reduce packaging waste and they report annually on their progress In this sense the Covenant provides flexibility to signatories to develop plans suitable to their own circumstances The Covenantrsquos success (it currently has over 600 signatories) is due to the active promotion of it by Government and key industry players

The Covenant is complemented by a regulation the National Environment Protection (Used Packaging Materials) Measure (the NEPM) which enables states and territories to use enforcement action to require companies that donrsquot sign the agreement to take steps to reduce their packaging waste Preceding the Covenant and the NEPM were a number of voluntary industry agreements but these were limited in scope and largely focused on companies in the beverage industry

42 National Industry Reduction Agreement

The Publishers National Environment Bureau (PNEB) was formed in 1990 as an association of the major publishers of newspapers and magazines in Australia to promote the recovery and recycling of old newspapers and old magazines primarily from community kerbside collections organised by local councils

68

The PNEB and a newsprint manufacturer have voluntarily entered into a series of five-year Industry Waste Reduction Agreements with the Commonwealth and State Governments Under the current (third) plan 2001-2005 newsprint recycling in Australia has grown to 754 nationally in 2005 from the 28 level when the PNEB was formed in 1990

43 StateLocal target based programs

There have been a number of agreements signed by state government departments and an industry group where there is a stated goal to reach a specific environmental target For example in the early 1990s there was a voluntary agreement with the EPA Victoria and companies in the Altona Chemical Complex in the western suburbs of Melbourne (which includes Australian Vinyls BASF Dow Chemicals and Qenos) to reduce hydrocarbon emissions by 50 within a specified timeframe The target was met and further emissions reductions were negotiated The NSW EPA-Oil industry petrol volatility agreement outlined below is another example of a target based program

44 NSW EPA-Oil Industry Memorandum of Understanding on Summer Petrol Volatility

In 1998 NSW established arrangements for the supply of low volatility petrol in summer in the Sydney Greater Metropolitan Region implemented through a Memorandum of Understanding between the then EPA and oil companies The principal reason for controlling petrol volatility in summer is to reduce evaporative emissions of VOCs (from vehicles and production and storage sites) which contribute to ozone formation

The Memorandum of Understanding operated over four summer periods from 1998 to 2002 and involved companies voluntarily reducing petrol volatility (measured in kilopascals (kPa) of vapour pressure) over three summer periods from a base of 76kPa to 70kPa in the first summer 67kPa in the second and 62 kPa in the last two years

Although the Memorandum of Understanding was successful in progressively reducing petrol volatility over the period of its operation it was not supported by all industry members Consequently agreement was reached with industry that summer petrol volatility limits should be regulated to ensure a level playing field for all industry participants and regulated limits will apply from the summer of 200405

69

5 Summary of Australian Benchmark Programs

Program National State

Summary of Approach Impact

Voluntary Programs Altona Chemical Complex (Vic)

Local Small industry group worked towards self determined targets

Very high

Energy Star National Standards based label Limited Gas appliance Rating Scheme

National Industry operated labelling scheme with stars assigned therefore has graded benchmarksminimum performance standards out dated web database being developed

Low

National Industry Reduction Agreement

National Small industry group worked towards negotiated targets

High

NSW EPA-Oil Industry MOU

State Small industry group worked towards negotiated targets but not all involved ndash lead to regulations

Moderate

Top Energy Saver Award

National Achievement based label Limited

Quasi Regulatory Green Vehicle Guide

National Well promoted web database star ratings assigned therefore has graded benchmarks data provided voluntarily but backed by ADR requirements

High

Stand-by power National Required to achieve voluntary targets or regulation will be introduced

Unknown

National Packaging Covent

National Performance based targets backed by legislation High

Regulatory Energy Efficiency Labels

National Labelling scheme with stars assigned therefore has graded benchmarksbased on Australian Standard web database

High

MEPS National Sets base benchmark and works with energy rating

High

WELS Scheme National Labelling scheme with stars assigned therefore has graded benchmarksbased on Australian Standardweb database

High

Wood heaters State Only one benchmark assigned regulations are not uniform

Moderate

authorrsquos assessment based on direct or indirect knowledge of these programs

70

Appendix 3 Productivity Commission Comments on Labelling and Minimum Performance Standards

The Productivity Commission an independent agency which is the Australian Governmentrsquos principal review and advisory body on microeconomic policy and regulation recently examined the cost effectiveness of improving energy efficiency As part of its review lsquoThe Private Cost Effectiveness of Improving Energy Efficiencyrsquo it examined labelling programs minimum mandatory energy efficiency requirements and other means of providing consumer information The final report contains some highly relevant material that is applicable to establishing a benchmarking scheme for small engines

The following is a summary of relevant conclusions from the Inquiry

Government Operated Labelling Schemes

From consumer research provided to the Commission it concluded that ldquothere is some evidence to suggest that consumers are now paying more attention to labels than they have in the pastrdquo

The Commission was positive about labelling programs as labels

bull directly address ldquoa source of market failure mdash the asymmetry of information between buyers and sellers of energy-using productsrdquo

bull provide information to the consumer that is readily-accessible and easily-understood and therefore can assist in helping the consumer make better-informed choices

bull are likely to have produced net benefits for consumers

bull do not directly limit consumer choice

bull could provide a greater incentive for suppliers to sell products that use energy cost effectively

bull probably produced net social benefits

bull are most suited where there is a wide spread in the range of performances of comparable appliances and where information failures are most pronouncedrdquo

bull can be used to warn consumers that an appliance is very inefficient (through a disendorsement label) which could be effective in discouraging but not preventing consumers from buying the poor performing product

The Commission was supportive of Governmentrsquos role of drawing together and packaging information through labelling programs as this ensures that ldquorelevant and trusted information gets to those who would otherwise not get itrdquo In material reviewed by the Commission George Wilkenfeld and Associates and Energy Efficient Strategies (1999) claimed that labelling is unlikely to be effective if purchasers rarely inspect appliances in a showroom where they can compare performance across

71

different models or the purchaser is not the ultimate user and so has little interest in operating costs

Labelling programs involves both administration and compliance costs such as those incurred by suppliers in having their products tested but the Commission considered that labels should be more actively considered as an alternative to minimum performance standards

Minimum Performance Standards

Governments can prevent the sale of inefficient products by using minimum standards for example the Minimum Energy Performance Standards (MEPS) that apply to appliances such as refrigerators and freezers air conditioners and electric water heaters If appliances do not meet the minimum standard they cannot be sold in Australia Some appliances are covered by both MEPS and by labelling (for example refrigerators)

The Commission considered that MEPS and labels can be complementary as MEPS act to penalise the worst energy performers whereas labels rewarding the better performers

Costs comparisons of schemes

The Department of the Environment and Water Resources provided details about the costs involved in administering both the labelling scheme and the minimum performance standards for energy programs It stated that

bull the administration costs of MEPS are substantially lower than for labelling but the compliance costs can be higher

bull MEPS can have a greater cost for suppliers than labelling since suppliers must adjust their model ranges to meet the MEPS levels by the given date These compliance costs are however influenced by the lsquolead inrsquo time between the introduction of the regulatory proposal and the implementation of the MEPS

bull it is estimated that the administration costs for MEPS would be $3 million over the period 2000ndash15 compared to $39 million for labelling (in present value terms) (George Wilkenfeld and Associates and Energy Efficient Strategies 1999) Furthermore it was assumed that 84 per cent of administration costs were borne by appliance purchasers with the remainder borne by governments

It estimated that MEPS would increase the cost of appliances by $266 million over 2000ndash15 compared to $688 million for labelling (the latter cost being due to consumers voluntarily purchasing more efficient appliances)

72

Page 5: Outdoor Garden Equipment - Department of the Environment

List of Figures

Figure 1 Example of a Californian Consumer Advisory Hang Tag11

Figure 2 Extract from survey form18

Figure 3 Compliance with overseas standards - all surveyed products20

Figure 4 Compliance with overseas standards by equipment type21

Figure 5 Engine type for popular categories 21

Figure 6 Compliance with overseas standards for popular categories 22

Figure 7 OPEA estimates of equipment sales in 2005-0624

List of Tables

Figure 1 Example of a Californian Consumer Advisory Hang Tag11

Figure 2 Extract from survey form18

Figure 3 Compliance with overseas standards - all surveyed products20

Figure 4 Compliance with overseas standards by equipment type21

Figure 5 Engine type for popular categories 21

Figure 6 Compliance with overseas standards for popular categories 22

Figure 7 OPEA estimates of equipment sales in 2005-0624

i

Abbreviations and Glossary 2c Two stroke with carburettor 2di Two stroke with direct fuel injection 2i Two stroke with pre-chamber fuel injection 4c Four stroke with carburettor 4i Four stroke with fuel injection (includes direct injection) ABS Australian Bureau of Statistics ABT Averaging Banking and Trading of emissions ADR Australian Design Rule Air NEPM National Environment Protection Measure for ambient air quality BTEX Benzene toluene ethylbenzene xylenes - carcinogenic or mutagenic aromatic

hydrocarbons formed through the combustion process CARB Californian Air Resources Board CBA Cost Benefit Analysis cc Cubic centimetres CO Carbon Monoxide DEC Department of Environment and Conservation di Direct Injection efi Electronic fuel injection EU European Union Euromot The European Association of Internal Combustion Manufacturers gkW- hr Grams per kilowatt hour HCs Hydrocarbons ndashmost are VOCS and in relation to small engines the terms are

often used interchangeably hp Horsepower 1 hp =7457 watts ISO International Standards Organization kW Kilowatts MEPS Minimum Energy Performance Standards MOU Memorandum of Understanding NATA National Association of Testing Authorities NOx Oxides of Nitrogen NPI National Pollutant Inventory NSW GMR New South Wales Greater Metropolitan Region which includes Sydney Lower

Hunter and Illawarra regions encompassing the major metropolitan centres of Sydney Newcastle and Wollongong Population approximately 47 million

OPEA Outdoor Power Equipment Association PM10 Particles with an aerodynamic diameter of 25 micrometres or less PM25 Particles with an aerodynamic diameter of 10 micrometres or less Port Phillip Region in Victoria of 24000 km2 that includes Greater Melbourne and Greater Region Geelong It is defined in Victorian environmental policy Population

approximately 34 million (1996) SE Qld South East Queensland - a region that covers the area from the Gold Coast to the

Sunshine Coast and west to Toowoomba It includes Brisbane amp suburbs population approximately 23 million people

USEPA United State of America Environmental Protection Agency VOCs Volatile Organic Compounds WELS Water Appliances Water Efficiency Labelling and Standards Scheme

ii

Executive Summary

Background

This report sets out the results of a project to compare and benchmark emissions from small petrol engines (less than 19 kilowatts) that are used to power outdoor garden equipment and were available for sale in Australia during 2006 The equipment powered by these small engines are used in lawnmowers brushcutters hedge trimmers and the like

These engines emit volatile organic compounds (VOCs) and oxides of nitrogen (NOx) which contribute to ozone (photochemical smog) formation in summer They also emit particles carbon monoxide (CO) and a range of air toxics such as benzene

Sydneyrsquos Greater Metropolitan Region (GMR) annually records exceedances of the National Environment Protection (Ambient Air Quality) Measure (Air NEPM) ozone standards The other jurisdictions meet or are close to meeting the current ozone standards

The Air NEPM standards are being reviewed and based on current human health evidence the argument appears to be strengthening for tighter ozone standards Should a stricter standard or an eight-hour standard consistent with international standardsguidelines be adopted achievability of Air NEPM ozone standards or goals could become an issue for some of the other major urban airsheds

The United States California Canada and Europe regulate emissions from outdoor equipment - the USA has had these in place since 1997 There are no Australian regulations or standards that limit air pollutant emissions from engines used in outdoor garden equipment however as the majority of equipment sold in Australia is imported some do comply with emission standards applicable to the country of origin

Small engines are not as advanced in environmental terms as motor vehicle engines As a result even the better-performing small engines emit far greater quantities of pollutants per hour than typical modern car engines For example the US Environmental Protection Agency (USEPA) 2002 limit for a typical 4 kilowatt (kW) lawnmower motor is about 66 grams (g) of regulated pollutants per hour of operation A typical 08kW brushcutter sold new in 2002 emitted about 160grams of pollutants per hour - reducing to 40grams per hour if bought new in 2006 The equivalent limit for cars under Australian Design Rule 79 is about 16g per hour In other words one hour of operation of a brushcutter that meets USEPA 2002 limits produces the same pollution as ten cars operated over a similar time These comparisons are subject to differences in test methods but they do provide an indication of the disproportionate amount of pollution emitted by small engines

Engines that do not comply with current USEPA requirements are likely to emit several times the amount of pollution calculated in the above example Therefore the worst performing engines are likely to emit more than ten times the emissions of the best performers

iii

Based on estimates made using the National Pollutant Inventory database engines used in lawn mowers contribute approximately 4 on average to VOC emissions from anthropogenic sources in major airsheds in Australia when public open space lawn mowing is included This is likely to rise to around 11 in the warmer spring and autumn weekends which is when lawns and other vegetation grows faster and when gardening is more popular The NPI does not take into account emissions from other types of powered outdoor equipment

The Australian Market

According to the Outdoor Power Equipment Association (OPEA) approximately 424000 walk behind lawnmowers and more than 792000 units of outdoor handheld equipment were sold in Australia in 2005-06 In addition there were sales of about 80000 replacement engines and 70000 pumps in 2005-06 most of which were four strokes The general household consumer represents the major market segment for garden equipment accounting for up to 90 of product sales with commercial garden services and government purchasing the rest

Indications are that sales of imported high polluting two stroke engines have increased over the last few years and it appears that the price of some powered garden equipment has dropped to the level where consumers regard them as disposables

An assessment of outdoor equipment on the Australian market found that the majority of small engines sold in Australia are imported and many come from countries that impose emission limits The extent of imports into Australia that do not comply with the country of origin standards is not known However the industry estimate that 40 of garden products are sold through importers who are not linked to manufacturers of US EPA or European certified equipment and the source of some products sold here is difficult to establish Victa is the only company producing small engines in Australia Its iconic 2-stroke lawn mower engine currently does not meet overseas emission limits for non-handheld equipment and Victa is undertaking research and development to reduce emissions from its two stroke engine to meet US and European standards

In spite of several attempts to obtain data on compliance with overseas emission standards from Australian distributors their response was poor The following figure therefore provides a best estimate of expected compliance of outdoor equipment on the Australian market with European CARB or USEPA requirements applicable in 2004

iv

Figure E1 Compliance with overseas standards for popular categories ldquoPhase 1 equivrdquo means the engine complies with US EPA phase 1 or 200288EU ldquoPhase 2 equivrdquo means the engine complies with US EPA Phase 2 Euro I or Euro 2 ldquoUnknown means that engine cycle (stroke) was not provided

Measures to Increase Sales of Low Emission Garden Equipment Engines

There is a range of options that could be considered for reducing emissions from engines used in outdoor garden equipment engines in Australia These include

1 Maintaining the Status Quo

2 Government ndash Industry Partnership Program

3 Quasi regulation

4 Co-regulation

5 Regulations based on either a simple benchmark or tiered benchmarks

The Small Engine Expert Panel ndashOutdoor Equipment has considered in depth the most appropriate approach to take to improve the emissions performance of outdoor garden equipment sold in Australia It recommends the introduction of national regulations to control the emissions from outdoor garden equipment particularly in light of the increase in cheap imports onto the Australian market which although untested are considered very likely to have high emission levels The Expert Panel has developed some broad recommendation on which Australian regulations could be based which takes in consideration the local market and Victa These are summarised as follows

1 Mandatory air pollutant emission standards to be introduced in Australia for all outdoor equipment (lt19kW) powered by spark-ignition engines

v

The development of any regulation would need to be based on a formal assessment of the costs and benefits of nationally regulating two and four stroke lawn mowers and handheld power equipment which should commence immediately

2 Proposed standards to mirror US EPA regulations (compliance with equivalent EU regulations also acceptable)

3 Timing (subject to completion of assessment of costs and benefits)

(a) US EPA Phase 1 ndash Effective from 20072008

(b) US EPA Phase 2 ndash Fully implemented in 2012 (in step with 2007 USEPA limits) plus a phase-in period andor provisions for averaging banking and trading (ABT) of emissions over 2008-2012 to provide for early introduction of cleaner product

The US EPA Phase 1 and Phase two emissions limits are given in the table below

4 Walk-behind two stroke mowers to be included in US EPA Category 5 (gt50cc) product classifications (to provide Victa time to develop a cleaner engine) Implementation timing is proposed to be the same as Recommendation 3 above

5 All products also to be certified to relevant EPA product durability categories

6 Subject to further review ABT if included may be phased out after 2012

Table E1 Comparison between the USA Phase 1 and Phase 2 standards

Emission Limits GkW-hr

Phase 1 (1997 ndash2001) Phase 2 (2007) HC NOx HC+NOx CO HC+NOx CO

Non-handheld

I-A lt66cc 161 161 610

I-B 66-lt100cc 161 161 610

I 100-225 cm3 161 519 161 610

II 225 cm3 134 519 121 610

Handheld

III lt20 cm3 295 536 805 50 805

IV 20-50 cm3 241 536 805 50 805

V 50 cm3 161 536 603 72 603 Phase 2 limits were phased in between 2002 -2007 during which time they became tighter

For simplicity only the 2007 are shown in this table (see Table 2 for more details)

vi

Conclusion

From this review it is apparent that it is highly unlikely that the companies in the industry would engage in or commit to any voluntary type program It is therefore clear that the most expedient path to reduce emissions from these small engines is through national regulation State based regulations could only provide a piecemeal approach that would lead to product dumping in states where there are no regulations and inconsistent regulations that require industry to treat each state market differently In addition enforcement of any state based regulations would be a key problem due to existing Commonwealth and State Government mutual recognition legislation

While any national regulation of emissions from small engines used in garden equipment in Australia are likely to be based on overseas regulations they need to strike a balance between improved environmental outcome harmonisation with international standards and the characteristics of the local industry With regulations optimum emissions reduction are potentially achievable by combining minimum emissions standards with tiered product labelling Whether this approach is justifiable on economic grounds that is the benefits outweigh the costs can only be determined through a detailed impact assessment Based on these findings it is recommended that a formal assessment of the costs and benefits of nationally regulating two and four stroke lawn mowers and handheld power equipment should be commenced

vii

1 Introduction

This report sets out the results of a project to compare and benchmark emissions from engines used in outdoor garden equipment that were available for sale in Australia during 2006 Possible outcomes from the project range from consumer guidelines for selecting low emission engines to regulatory controls on emissions There are currently no state or national regulations that directly control emissions from these engines

The project was commissioned by the Commonwealth Department of the Environment and Water Resources on behalf of state and territory government departments working on reducing the impacts of small engine emissions This report was prepared in consultation with an Expert Panel that included representatives from the Outdoor Power Equipment Association (OPEA)

11 Emissions from outdoor garden equipment engines

Small engines particularly conventional two stroke engines used in applications such as outdoor garden equipment are high polluters relative to their engine size and usage1 These small engines emit volatile organic compounds (VOCs) and oxides of nitrogen (NOx) which contribute to ozone (photochemical smog) formation in summer They also emit particles carbon monoxide (CO) and a range of air toxics such as benzene The USA California Canada and Europe and regulate emissions of VOCs NOx carbon monoxide and particle emissions from outdoor garden equipment

There are five types of spark-ignition engines that can be used in outdoor garden equipment

bull two stroke with carburettor (2c)

bull two stroke with pre-chamber fuel injection (2i)

bull two stroke with direct fuel injection (2di)

bull four stroke with carburettor (4c)

bull four stroke with fuel injection (4i) (includes direct injection)

Carburettor and pre-chamber fuel injection two stroke engines are inherently more polluting than the other three types This is due to their inability to completely separate the inlet gases from the exhaust gases resulting in up to 30 of the fuel being left unburnt and the need to add oil to the fuel to lubricate the engine (four stroke engines have separate reservoirs for fuel and oil) However twostroke carburettor engines typically weigh less than a four stroke engine of the same power and this tends to make them attractive for handheld equipment They also tend to have fewer components are generally cheaper to purchase and are cheaper to maintain than

1 Outdoor equipment covered in this report are engines less than 19kW

1

four stroke motors Victa Lawncare is currently undertaking research and development to improve the environmental performance of two stroke carburettors and while some emission improvements have been made a two stroke compliant with US or European standards is still considered several years away

Four stroke carburettor engines are generally quieter more fuel efficient and are less polluting than conventional two stroke engines

Direct fuel injection (dfi) either two stroke or four stroke overcomes the unburnt fuel problem and can meet the stringent regulated exhaust emission limits that apply overseas However there is not any evidence that dfi engines are being used in outdoor garden equipment available in Australia It appears that engines used in outdoor garden equipment in Australia are generally restricted to two and four stroke carburettor engines

Small engines are not as advanced in environmental terms as motor vehicle engines As a result even the better-performing small engines emit far greater quantities of pollutants per hour than typical modern car engines For example the US Environmental Protection Agency (USEPA) 2002 limit for a typical 4 kilowatt (kW) lawnmower motor is about 66 grams (g) of regulated pollutants per hour of operation A typical 08kW brushcutter sold new in 2002 emitted about 160grams of pollutants per hour - reducing to 40grams per hour if bought new in 2006 The equivalent limit for cars under Australian Design Rule 79 is about 16g per hour In other words operated over a similar time one hour of operation of a brushcutter that meets USEPA 2002 limits produces the same pollution as ten cars and a 4kW lawnmower the same pollution as four cars These comparisons are subject to differences in test methods but they do provide an indication of the disproportionate amount of pollution emitted by small engines

Engines that do not comply with current USEPA requirements are likely to emit several times the amount of pollution calculated in the above example Therefore the worst performing engines are likely to emit some ten times the emissions of the best performers

Because of the combustion of oil these engines also emit high levels of particles Although small engines only contribute a small amount to total particle emissions the rate of particle release compared to other engines can be very high For example lawnmowers can emit over 10 times more particles (in terms of grams per hour) than a petrol motor vehicle (manufactured between 1994 and 2001)

All the above emission comparisons between outdoor garden equipment engines and motor vehicles are subject to differences in test methods but they indicate the disproportionate amount of pollution emitted by small garden equipment engines It also needs to be recognised that motor vehicles in Australia average more than 15000 kilometres per year (ABS 2003) while the annual average use of outdoor garden equipment is around 25 hours for a lawnmower and less for other types of equipment Commercial operators however are likely to have a much higher usage rates than the general public

2

This paper examines the Australian market for small engines used in lawnmowers and handheld garden equipment their impact on air quality relevant overseas regulations and their applicability to Australia and makes recommendations to reduce air quality impacts from these engines

A wide range of information sources has been referenced for this report including data and information supplied by manufacturers distributors and dealers in small engines

3

2 Air Quality and Outdoor Garden Equipment Engines

Emission inventories make estimates of emissions of substances from a multitude of sources into airsheds The National Pollutant Inventory (NPI) which is run cooperatively by the Australian state and territory governments contains data on 90 substances that are emitted to the Australian environment The substances included in the NPI have been identified as important because of their possible health and environmental effects Industry facilities estimate their own emissions annually and report to states and territories Non-industry (or diffuse) emissions estimates which includes emissions from outdoor garden equipment are made by the states and territories on a periodic basis using information sources such as surveys databases and sales figures

The NPI only reports emissions from domestic lawn mowing and for a few airsheds the contribution made by public open space lawn mowing It does not report on the contribution made by other types of outdoor garden equipment such as brushcutters National and selected state NPI emissions estimates for the common air pollutants and for Air Toxics NEPM pollutants from domestic lawn mowing are summarised in Table 1 It should be noted that national emissions from lawn mowing are underestimates as the NPI records emissions for major airsheds only and therefore is not Australia wide plus the estimates do not include evaporative emissions from fuel tanks and hoses

This NPI data is indicative only as the accuracy and completeness of the data sets varies across airsheds and is reliant on the estimation techniques used For example while the population in the NSW is higher than other airsheds its emissions look disproportionally high when compared to the other airsheds This could be because the estimation technique varies or it is due to some other factor

4

Table 1 National Pollutant Inventory Domestic Lawn Mowing Emission Estimates

Substance Port Phillip

Population 34 mill (1996)

SE Qld

Population 23 mill

NSW GMR

Population 47 mill

Adelaide

Population 10 mill

National

Common Air Pollutants (tonnesyear)

Carbon monoxide 12000 12000 24000 6100 69000

Total Volatile Organic Compounds 3600 3800 7000 2000 21000

Particulate Matter 100 um 86 94 170 9 460

Sulphur dioxide 5 5 9 50 81

Oxides of Nitrogen 63 54 120 24 330

Air Toxics (tonnesyear)

Benzene 230 210 390 130 1200

Formaldehyde 56 38 NA 31 180

Polycyclic aromatic hydrocarbons 07 11 21 04 41

Toluene (methylbenzene) 370 360 660 210 2000

Xylenes (individual or mixed isomers) 270 260 490 150 1500

Analysis of the NPI database at the national level shows that domestic lawn mowing is the

- Fourth largest source of benzene contributing 7 to the total reported airshed load

- Fourth largest source of formaldehyde contributing 3 to the total reported airshed load

- Fifth largest source of xylene contributing 6 to the total reported airshed load

- Fifth largest source of toluene contributing 6 to the total reported airshed load

- Sixth largest source of carbon monoxide contributing 12 to the total reported airshed load

- Ninth largest source of VOCs contributing 3 to the total reported airshed load when biogenics (natural sources such as trees and soil) are excluded

The NSW Department of Environment and Conservation has been upgrading its emissions inventory Based on 2003 emissions data non-road anthropogenic sources

5

contribute 619 of the VOCs to the GMR airshed Preliminary results2 indicate that VOC emissions from domestic and public open space lawn mowing contributes on an annual average 41 of all VOC emissions in the GMR On a typical weekend during warmer weather this percentage rises to 11

Therefore it could be assumed that lawn mowing could contribute approximately 4 on average to VOC emissions from anthropogenic sources in major airsheds in Australia when public open space lawn mowing is included This percentage is likely to rise significantly in the warmer spring and autumn weekends which is when lawns and other vegetation grow faster and when more people garden

21 Air Quality Standards

In June 1998 the National Environment Protection Measure for Ambient Air (Air NEPM) established national uniform standards for ambient air quality for the six most common air pollutants ndash carbon monoxide nitrogen dioxide photochemical oxidants (measured as ozone) sulfur dioxide lead and particles less than 10 microns (PM10) The NEPM was varied in 2003 to include PM25 advisory reporting standards and in April 2004 a National Environment Protection Measure for Air Toxics was adopted

Nationally the common pollutants of most concern (particularly in major urban areas) are fine particles and ground level photochemical smog (measured as ozone) which is formed in the warmer months when volatile organic compounds (VOCs) and oxides of nitrogen (NOx) react in the atmosphere under the influence of sunlight in a series of chemical reactions

Recent health studies (cited in NEPC 2005) have strengthened the evidence that there are short-term ozone effects on mortality and respiratory disease The studies also strengthen the view that there does not appear to be a threshold for ozone below which no effects on health are expected to occur In recent years Australian epidemiological studies have been conducted which confirm the results of overseas studies that there is a relationship between elevated ozone levels and hospitalisations and deaths from certain conditions

There are two national ozone standards a one hour standard of 010ppm and a four hour standard of 008ppm with a goal that allows for one exceedance per year by 2008 Sydney experiences a number of days each year of ozone levels above these standards In 2003 Sydney exceeded the one hour standard on 11 days in 2003 19 days in 2004 and 9 days in 2005 The four hour standard was exceeded on 13 days in 2003 19 days in 2004 and 13 days in 2005 Further reductions in VOC and NOx emissions are needed to reduce ozone concentrations in Sydney to levels that would comply with the Air NEPM

The other jurisdictions meet or are close to meeting the current National Environment Protection (Ambient Air Quality) Measure (Air NEPM) ozone standards (NEPC 2005) However the ozone standards are being reviewed and based on current human health evidence the argument appears to be strengthening for tighter ozone standards

2 Presentation to Expert Panel 27 April 2006 by Nick Agipades Manager Major Air Projects NSW DEC

6

Should a stricter standard or an eight-hour standard consistent with international standardsguidelines be adopted achievability of Air NEPM ozone standards or goals could become an issue for some of the other major urban airsheds (NEPC 2005)

Modeling of ozone for Sydneyrsquos Greater Metropolitan Region (GMR) indicates that the implementation of Euro emission limits for on-road vehicles and hence the increased presence of these less polluting vehicles in the fleet and retirement of old more polluting vehicles from the fleet is not sufficient to meet the current NEPM goals Modeling suggests that very large reductions in precursor emissions would be required to meet the current ozone one hour goal (NEPC 2005)

Even when the effects of bushfires and when hazard reduction burning are taken into consideration airsheds such as Launceston Melbourne and Sydney struggle to meet the national standards for particles (EPA 2006) However outdoor powered equipment predominantly from two stroke engines makes only a minor contribution to ambient fine particle loads

While carbon monoxide emissions from engines used in outdoor garden equipment are regulated overseas air monitoring in Australia indicates that carbon monoxides levels are well below the national air quality standards and there are no pressing issues requiring CO from outdoor powered equipment to be regulated In addition data indicates that lowering emissions of VOCs and NOx from small engines reduces CO emissions

Many of the pollutant sources which contribute to the formation of ozone and to particle levels also contain air toxics such as benzene toluene formaldehyde and xylenes These air toxics have been shown to be responsible for a range of health problems including asthma respiratory illnesses and cancer The National Environment Protection Measure for Air Toxics requires each jurisdiction to monitor and report annually on five air toxics benzene polycyclic aromatic hydrocarbons formaldehyde toluene and xylenes The monitoring data is intended to inform future policy and also the public on ambient levels of these air pollutants Monitoring of air toxics to date shows that levels are low and below the national monitoring investigation levels (EPA Vic 2006 DEC 2006)

7

3 Emission Standards for Small Engines

31 Australia

At present there are no Australian regulations or standards to limit air pollutant emissions from small (two and four stroke) engines Australia does benefit to some extent from overseas regulations as many lawnmowers and other gardening equipment sold in Australia have engines manufactured in the United States or Europe where strict standards apply

32 United States

In the United States emission regulations set by the United States Environmental Protection Agency (USEPA) and the Californian Air Resources Board (CARB) apply to lawn mowers and other powered gardening equipment Although CARB standards currently tend to be stricter than USEPA standards by 2006 emissions limits applying under the two standards will be very similar

United States Environment Protection Agency (US EPA)

In 1995 the USEPA introduced ldquoPhase 1rdquo regulations covering small non-road engines with a power of not more than 19kW (25HP) The regulations applied to equipment manufactured from 1997

These regulations have seven classes of equipment based on portability and engine displacement volume (ldquocapacityrdquo) In March 2000 the USEPA published ldquoPhase 2rdquo regulations which are shown in Table 2 These set limits for combined emissions of hydrocarbons (HC) and oxides of nitrogen (NOx) and separate limits for carbon monoxide (CO) emissions and for two stroke engines only particles

Table 2 US EPA Phase 2 Small Engine Emissions Standards (HC+NOx in gkW-hr) (a) (b)

Small Engine Class

Type 2002 2003 2004 2005 2006 2007+

I-A (lt66cc) Non-handheld (eg lawnmowers)

- 161 161 161 161 161

I-B (66 to lt 100cc) - 161 161 161 161 161

I (100 to lt 225cc) - 161 161 161 161 161

II (225cc or more) 180 166 150 136 121 121

III (lt20cc) Handheld (eg trimmers)

238 175 113 50 50 50

IV (20 to lt50cc) 196 148 99 50 50 50

V (50cc or more) - - 143 119 96 72 (a) As carbon monoxide (CO) levels in Australia are well below the Air NEPM standard the

USEPA emission limits for CO have not been included in this table (b) Includes useful life criteria of 50125300 hours

8

When the USEPA introduced ldquoPhase 2rdquo regulations it included averaging banking and trading provisions (ABT) which were seen ldquoas an important element in making stringent Phase 2 emissions standards achievable with regard to technological feasibility lead time and costrdquo (USA 1999) The USEPA also claimed (USA 2000) that the ABT program secures early emissions benefits through the early introduction of cleaner engines

ABT provisions which apply to handheld and non handheld engines are complex but in broad terms averaging means the exchange of emission credits among engine families within a given engine manufacturerrsquos product line This allows a manufacturer to produce some engines that exceed the standards and offsetting these exceedances with emissions from engines that are below the standard Manufacturers are allowed to exchange credits from handheld to non handheld and vice versa Banking means the retention of emission credits by the engine manufacturer generating the credits for use in a future model year (for averaging or trading) Trading is the exchange of emission credits between engine manufacturers which then can be used for averaging purposes banked for future use or traded to another engine manufacturer

In January 2004 USEPA reported that in 2002 averaging was being used but there was very little use of banking It determined that the initial ABT programs as too complex and included discount rates on credits ABT was simplified in 2004 including the elimination of credit discount and multipliers and limits on credit life To date there has reportedly been limited use of banking however it is anticipated that there will be more widespread use of banking credits if the USEPA proposed Phase 3 comes into effect3 (see below)

Particulate limits (2gkW-hr) also apply to two stroke engines Carbon monoxide and durability limits (or useful life) are also prescribed The durability criteria which were introduced in Phase 2 require that the emission limits must be met through the useful life of the engine The manufacturer determines useful life of each product using standardised product testing procedures and then based on the test results selects the useful life category for each product which can be 125 250 or 500 hours These durability criteria acknowledge the large disparity in usage patterns by equipment type and between commercial and residential users It also takes into account the ability of manufacturers to design and build engines for various design lives and which fit the types of equipment engine is produced for

The March 2000 USEPA report (USEPA 2000) estimated that the expected effects of the Phase 2 regulations would be

bull A 70 reduction in HC+NOx beyond the Phase I standards (which were estimated to have reduced emissions by 32 from the unregulated baseline)

bull A 30 reduction in fuel consumption of small handheld equipment bull Price increases of between $US23 (Class III) and $US56 (Class V) for

handheld equipment

3 Dave Gardner Briggs and Stratton email 22506

9

The US EPA is currently considering lsquoPhase 3rsquo regulations which are catalyst based standards to further reduce exhaust HC and NOx emissions from non handheld engines reduce evaporative HC and NOx emissions for both handheld and non handheld engines plus include extended durability criteria These limits are currently at discussion stage only They align with CARB Tier 3 but a longer lead time is proposed

Table 3 Proposed Phase 3 Exhaust Emissions

HC+NOx gkW-hr

CO gkW-hr

Year Useful life hrs

Class I 100 610 2010 125250500

Class II 80 610 2011 2505001000

Class III-V No changes

HC+NOx std is based on averaging

Californian Air Resources Board (CARB)

Spark ignition engines

CARB regulations first introduced emission limits for small engines manufactured from1995 The more recent schedule of emission limits are shown in Table 4 These limits depend solely on the engine capacity and apply to both handheld and non handheld classes

Table 4 CARB Emission Limits for Small Engines (HC+NOx in gkw-hr)

Engine Capacity 2000-2001 2002-2005 2006+

65cc or less 72 72 72

gt65cc to 225cc 161 161 161

gt225cc 134 121 121

California has particle limits for two strokes useful life criteria and mandatory engine labeling including a consumer advisory hang tag as shown in Figure 1 The USEPA is also considering introducing an air index label

10

Figure 1 Example of a Californian Consumer Advisory Hang Tag The Californian regulations take into account sales weighted emission performance for families of engines An engine family is essentially the same engine being used in different equipment items

In 2003 California adopted a Tier 3 program for exhaust and evaporative emissions and these are based on the use of catalytic convertors The engine classes better align with US EPA categories however the exhaust standards for Class I and Class II are more stringent than the existing US EPA standards

Table 5 CARB Tier 3 for Exhaust Emissions

Model Year Displacement Category

Durability Periods (hours)

HC+NOx gkw-hr

CO gkw-hr

Particulate gkw-hr

2005 and subsequent

lt50 cc 50125300 50 536 20 + 50-80 cc inclusive 50125300 72 536 20 +

2005 gt80 cc - lt225 cc Horizontal-shaft eng

125250500 161 549

gt80 cc - lt225 cc NA 161 467 Vertical-shaft Engine 225 cc 125250500 121 549

2006 gt80 cc - lt225 cc 125250500 161 549 225 cc 125250500 121 549

2007 gt80 cc - lt225 cc 125250500 100 549 225 cc 125250500 121 549

2008 and subsequent

gt80 cc - lt225 cc 125250500 100 549 225 cc 1252505001000 80 549

the 1000 hours is applicable for 2008+ Model Year (MY) + applies to 2 stroke only Source California Exhaust Emission Standards and Test Procedures For 2005 And Later Small Off-Road Engines Adopted July 26 2004 effective on October 20 2004

California also has Blue Sky provisions These are voluntary standards for engines that meet the criteria shown in Table 6 Blue Sky Series engines are not included in

11

the averaging banking and trading program Zero-emission small off-road equipment (eg push mowers) may certify to the Blue Sky Series emission standards

In 2005 CARB aligned its test procedures with the USEPA

Table 6 CARB Blue Sky Provisions

Model Year Displacement Category

HC+NOx gkw-hr

CO gkw-hr

Particulate

2005 and subsequent lt50 cc 25 536 20

50 - 80 cc inclusive 36 536 20

2007 and subsequent gt80 cc - lt225 cc 50 549

2008 and subsequent 225 cc 40 549 Applicable to all two stroke engines

33 Canada

The Canadian small engine market has similarities to the Australia market the majority of small engines are imported from the USA and there is one Canadian manufacturer of small spark ignition engines and one major manufacturer of lawn and garden machines

A Memorandum of Understanding (MOU) which came into effect on 1 January 2000 was signed between Environment Canada and ten manufacturers of handheld equipment and nine manufacturers of engines used in non handheld machines The MOU was intended as an interim measure until regulations could be put in place Under the MOU the manufacturers agreed to voluntarily supply small spark ignition engines designed to meet the applicable USEPA Phase 1 emission standards

In 2003 Canada regulated emission limits for handheld and non-handheld small engines based on USEPA emission limits The regulations apply to model years 2005 and later While there are no separate averaging banking and trading provisions in Canadian regulations Canada allows any USEPA certified engine to be sold in Canada This means that engines that do not meet the standard level but are averaged (or use credits) in the United States can be sold in Canada Manufacturers are required to produce upon request evidence of conformity to the standards and are required to provide written instructions on engine maintenance to the first retailer

12

Table 7 Canadian Small Spark-Ignition Engine Exhaust Emission Standards

Engine class

Engine Type

Engine Displacement (cm3)

Effective date (model year)

Standard HC+NOx (gkWshyhr)

Standard NMHC+NOx (gkW-hr)

Standard CO (gkWshyhr)

I-A Non-handheld lt66 2005 and

later 50a -shy 610a

I-B Non-handheld

lt100 and 66

2005 and later

40a 37a 610a

I Non-handheld

lt225 and 100

2005r 161b 148a 519b 610a

II Non-handheld 225 2005 and

later 121a 113a 610a

III Handheld 20 2005 and later 50a -shy 805a

IV Handheld lt50 and 20 2005 and later

50a -shy 805a

V Handheld 50 2005 2006 2007 and later

119a 96a

72a

-shy-shy

-shy

603a 603a

603a a Standards apply throughout the engine useful life b Standards apply only when the engine is new Source Canada Gazette Part II Vol 137 No 24 2003-11-19

34 Europe

In 1998 the European Union introduced exhaust emission limits for small petrol engines through Directive 9768EC and in 2002 introduced amendments through Directive 200288EC The limits in the Directives align with the US regulations however they do not have averaging and banking provisions

Table 8 European Emissions Standards

Small Engine Class Type (HC+NOx in gkW-hr) 2004 2005 2006 2007 2008

SN1 (lt66cc) Non-handheld (eg lawn mowers)

161 161 161 161 161

SN2 (66 to lt 100cc) 161 161 161 161 161

SN3 (100 to lt 225cc) - - - 161 161

SN4 (225cc or more) - - 121 121 121

SH1 (lt20cc) Handheld (eg trimmers)

- - - 50 50

SH2 (20 to lt50cc) - - - 50 50

SH3 (50cc or more) - - - - 72

13

The European Union is currently considering including useful life criteria and averaging and banking provisions plus it is considering introducing a Directive to further reduce emissions from diesel engines The objective of the proposal is to tighten emissions standards for engines in general non-road applications in light of technological developments and it taking into account the parallel developments for similar legislation in the United States in order to harmonise the environmental standards and to facilitate trade

Charts comparing the USA Californian and European Emission Limits are shown below

14

35 Summary of Regulations for Non Handheld Equipment

KEY TO CHARTS

USEPA CARB EU

0

10

20

30

40

50

60

70

80

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

0 to 49cc

0

10

20

30

40

50

60

70

80

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

50 to 65cc

0

2

4

6

8

10

12

14

16

18

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

100 to 224cc

0

2

4

6

8

10

12

14

16

18

20

2000

2002

2004

2006

2008

Year Model

HC

+N

Ox g

kW

-hr

225cc and over (up to 19kW)

15

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

36 Summary of Regulations for Handheld Equipment

KEY TO CHARTS

USEPA CARB EU

20 to 49cc 0 to 19cc

250 250

200

150

HC

+N

Ox g

kW

-hr

100

200

HC

+N

Ox g

kW

-hr

150

100

50 50

0 0

Year Model Year Model

50 to 65cc 66 to 80cc

160

160

140

140

120

40 40

20 20

0 0

120

HC

+N

Ox g

kW

-hr

HC

+N

Ox g

kW

-hr

100100

8080

60 60

Year Model Year Model

16

Summary of Regulations for Handheld Equipment (continued)

KEY TO CHARTS

USEPA CARB EU

0

20

40

60

80

100

120

140

160

2000

2001

2002

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

81 to 224cc

0

20

40

60

80

100

120

140

160

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

225cc and over (up to 19kW)

17

4 Australian Market for Small Engines

41 Likely compliance with overseas emissions standards

As part of this assessment an environmental profile of equipment currently on the Australian market has been developed initially based on information from manufacturersrsquo brochures and web sites and industry magazines and then confirmed through follow-up with relevant industry contacts

Each item of equipment has been assessed on its compliance with USEPA CARB or European regulations In most cases it was not possible to match models available on the Australian market with CARB lists (CARB publishes exhaust emissions data on all appliances on its web site) This was mainly due to the inconsistency of model designations and uncertainty about ldquoengine familiesrdquo

Engine characteristics and retail price were difficult to obtain Some brochures also made claims of compliance with USEPA European or CARB requirements The detailed breakdown of current equipment on the Australian market is given in Appendix 1

The majority of small engines sold in Australia are imported and many come from countries that impose emission limits The extent of imports into Australia that do not comply with the country of origin standards is not known Industry estimates that 40 of garden products are sold through importers who are not linked to manufacturers of US EPA or European certified equipment and the source of some products sold here is difficult to establish Victa is the only company producing small engines in Australia Its iconic 2-stroke lawnmower currently cannot meet overseas emission limits

Outdoor Power Equipment Association (OPEA) assisted in identifying the Australian distributors of most brands of powered garden equipment In April 2006 a survey form was sent to a total of 43 distributors representing 97 brands of equipment The survey form sought information about the engine for all petrol-fuelled garden equipment with a power not more than 19kW

Figure 2 Extract from survey form

18

Initial response to the survey was poor Despite follow-up action and efforts from the industry association at the beginning of September 2006 26 distributors had responded to the survey information and only 13 distributors provided all data necessary for benchmarking purposes This resulted in emission compliance data for about half of the estimated products on the Australian market Attempts to match Australian models with the database maintained by the Californian Air Resources Board were also of limited success due to inconsistencies in model designations between Australia and the USA and the manner in which model information is coded in the CARB database

Table 9 Summary of distributor responses

Responses status Not OPEA OPEA ALL

Number of responses 9 8 (31) 17 (40)

Response - all data 4 9 13 (30)

Response - extra time sought 3 3 (7)

Response - no petrol products 4 1 5 (12)

Response - some data 5 5 (12)

Grand Total 17 26 43 percentages may not add to 100 due to rounding

Of the 97 brands initially identified

bull 16 brands are apparently no longer sold in Australia

bull No responses were received for 29 brands

bull Partial data were received for 12 brands

bull All data was available for 30 brands

Table 10 Summary of responses by brand

Count of brands

Analysis status Not OPEA OPEA All

Missing some data 12 12

No data received 9 (27) 20 (31) 29 (30)

No longer sold 13 3 16

Response - no models to list 3 7 10

Response received (electronic form) 5 11 16

Response received (paper form) 3 2 5

Response received (spreadsheet) 9 9

All 33 64 97

A 2004 report for the NSW DEC estimated that there were about 1200 eligible garden

19

products in the Australian market The current project has obtained data for a total of 870 products or 72 of the estimated population In addition the sampling method is likely to be biased towards products with good environmental performance In these circumstances the following analysis should be regarded as indicative only

Survey results

The following tables and figures show expected compliance with European CARB or USEPA requirements based on the limited information provided by industry

Table 11 Engine type and compliance with overseas standards Count of products Engine type

Best STD 2c 4c Unknown All 1997 - US EPA I 53 32 85 (10) 200288EU 17 17 (2) 2004 - US EPA II 1 3 4 (lt1) 2004 EURO I 8 8 (1) 2005 - US EPA II 10 29 5 44 (5) 2006 - US EPA II 107 141 2 250 (29) 2006 EURO I 6 6 (1) 2007 - US EPA II 1 1 (lt1) 2007 Euro II 2 2 (lt1) None 118 90 208 (24 Unspecified 24 60 161 245 (28) All 344 358 168 870

Unknown means the type of engine is unknown (but is most likely to be 2c) Unspecified means that the status of emissions compliance was unable to be identified None means the manufacturerdistributor has indicated that the equipment does not comply with any overseas emissions standard

Figure 3 Compliance with overseas standards - all surveyed products Note Unknown in chart includes unspecified and unknown from Table 11

20

Figure 4 Compliance with overseas standards by equipment type ldquoPhase 1 equivrdquo means the engine complies with US EPA phase 1 or 200288EU ldquoPhase 2 equivrdquo means the engine complies with US EPA Phase 2 Euro I or Euro 2 ldquoUnknown means that engine cycle (stroke) was not provided

Of the 41 categories of equipment in the survey 15 had at least 10 current products Results for these categories are set out below

Figure 5 Engine type for popular categories

21

Figure 6 Compliance with overseas standards for popular categories ldquoPhase 1 equiv means the engine complies with US EPA phase 1 or 200288EU Phase 2 equiv means the engine complies with US EPA Phase 2 Euro I or Euro 2 ldquoUnknown means that engine cycle (stroke) was not provided

42 Australian Sales of Outdoor Powered Equipment

The Australian Outdoor Power Equipment Association (OPEA) whose membership represents about 80 of the manufacturersdistributors and dealers in the industry commissions regular independent industry audits of garden equipment sales (OPEA personal communications) Sales data from OPEA is shown in Table 12

22

Table 12 Sales of outdoor garden equipment 2002 and 2005-06 2005-06 2 stroke (1000)

2002 2 stroke (1000)

2005-06 4 stroke (1000)

2002 4 stroke (1000)

2005-06 TOTAL (1000)

2002 TOTAL (1000)

Walk behind mowers 72 170 351 76 424 246

Brushcuttertrimmer 321 12 17 180 339 192

Chainsaws 152 0 0 90 152 90

Chipper shredders 0 60 46 0 46 60

Blowerblower vacuums 98 0 11 50 109 50

Ride on mowers 0 25 51 0 51 25

Generators 11 32 96 0 107 32

Hedge trimmers ampothers 40 192 0 28 40 220

694 491 476 424 1267 915

for total sales 593 463 407 537

for mowers 152 280 848 720

According to OPEA approximately 424000 walk behind lawnmowers and more than 792000 units of outdoor handheld equipment were sold in Australia in 2005-06 In addition there were sales of about 80000 replacement engines and 70000 pumps in 2005-06 most of which were four strokes These figures show that there has been considerable growth in the sales of most products with the exception of chipper shredders and the category lsquohedge trimmers and othersrsquo whose sales declined in 2005shy06 compared with those in 2002 About 17 of walk behind lawnmowers were two stroke and 83 four stroke which is an improvement in the uptake of cleaner engines when compared to 2002 when about 30 were two stroke The situation with handheld equipment is reverse with nearly 79 being two strokes compared to 47 in 2002 However many models of two stroke handheld equipment meet current US emission standards and care should be exercised in using engine type (two stroke or four stroke) as an indicator of emissions performance for this class of equipment

The OPEA 2005-06 sales estimates are shown in Figure 7 OPEA cautions that there is considerable uncertainty about the estimates for brushcutters and blowerblower vacuums as OPEArsquos figures only represent 50 and 60 respectively of sales of these products No estimates of future sales trends were identified during research for this project

23

Australian sales of 2 and 4 stroke outdoor equipment 2005-6

0 50 100 150 200 250 300 350 400

Walk behind mowers

Brushcuttertrimmer

Chainsaws

Chipper shredders

Blowerblower vacuums

Ride on mowers

Generators

Other

Annual sales (x 1000)

4s 2s

Figure 7 OPEA estimates of equipment sales in 2005-06 Note Blowervac is an industry term for equipment that combines blowing and vacuuming functions

Briggs and Stratton (Australia) who import engines from the USA supply the majority of the four stroke engines for handheld equipment sold in Australia and these comply with all the current USA and CARB regulations Imported handheld garden equipment is shipped fully assembled to a branch or distributor and is then sent to a retailer The retailer may or may not provide equipment servicing

OPEA members have expressed concern regarding the increasing sales of imported high polluting two stroke engines that allegedly do not meet any emission standards and come from countries that do not have emission standards One industry representative reported that some of the imported trimmers were being manufactured in China using outdated designs and tooling from two old bankrupt American companies and these are being sold here at about 30 of the price of traditional brands and very low cost generators from China now account for around 70 of total sales It is difficult to confirm this trend without undertaking a detailed examination of Australian import data however the significant increase in the sales of two stroke handheld equipment provides some support for this trend

On the other hand it is claimed by industry that the ride on mower market (predominately with compliant four stroke engines) has been stimulated by the Australian USA free trade agreement

24

5 Australian Users of Small Engines This section examines the market segments for garden equipment and customer purchasing behaviour

51 General Public

Purchasing behaviour

Research into consumer purchasing behaviour has found that consumers assess a product against a range of attributes for example price weight brand reputation servicing and parts availability warrantees and guarantees experience size promotions and discounts Studies have also revealed that up to 82 of Australians had bought products on the basis of social or environmental factors in the previous year (State Chamber of Commerce 2001) Related to this point the energy star rating ecolabel on whitegoods was viewed as a credible environmental claims system which is well regarded by the general consumer (Product Category Manager Mitre 10 personal communications)

As the purchase of small engine garden equipment by the general consumer is an infrequent purchase which carries a certain of amount of risk With small engines the risk can be functional risk (will not perform as expected) physical risk (for example safe features such automatic cut out on an electric lawn mower) or financial risk especially for the more expensive items The general consumer is likely to lessen the risk by seeking information and by evaluating the information on the available products over a period of time The consumer may also lessen the risk by

bull purchasing well known brands

bull buying the brand offering the best warrantees and guarantees

bull buying the most expensive brand and

bull buying a brand they have used before

Research indicates that the desired attributes of a product may not be well established at the start of a consumerrsquos search process but will often be refined as the consumer learns more about the product The consumer will also use a ranking and weighting process based on desired qualities and trade offs may be made

Reportedly purchases of engine operated garden equipment are based on price yard size fitness for purpose and other features such as weight and ease of starting (Product Category Manager Mitre 10 personal communications) Males are the predominant purchasers of garden equipment however because of changing demographics there has been an increase in the number of women purchasing these products

Less than 5 of lawnmowers purchased are push or electric mowers (Product Category Manager Mitre 10 and industry sources personal communications 2003)

25

Electric mowers are generally perceived as not being as effective as cords have limited range and rechargeable electric mowers require frequent recharging

There is a recent trend towards ride on mowers (all four strokes) probably because of changing demographics specifically older age groups moving to more rural environments with larger yards (OPEA personal communications)

A study (Wilkie 1994) investigated consumer appliance purchasing behaviour and found that the general consumer consulted a range of information sources before purchasing an appliance The appliance salesperson was found to be the most important information source for many consumers Other important information sources include newspaper advertisements friends and relatives catalogues consumer reports and brochureslabels Since Wilkiersquos study the internet will have become increasingly important as a research tool and in some instances as a way to purchase products As part of this study there is evidence of low priced products being sold into the Australian market via the internet only ndash a practice that is likely to increase in the future It was difficult to source any compliance or details on these products

At the retail chain level staff product training is generally voluntary undertaken out of store hours and as an inducement to attend training sessions suppliers usually provide incentives for staff Retail chain purchases are very price driven although some chains are reportedly interested in stocking goods that have credible environmental claims (Mitre 10 and other retail chain sources)

IBIS (2006a) reports that the domestic hardware sector which is dominated by Danks (Home Timber and Hardware Thrifty - Link Hardware and Plants Plus Garden Centre) and Bunnings is classified as a growth market and the sales of lawnmowers and other lawn and garden machinery and equipment represent about 14 of sales revenue

In summary it appears that a range of product attributes influences consumer purchases of lawnmowers and outdoor equipment Currently there is very little information about emissions in any of the information sources a consumer is likely to consult when purchasing these products Nevertheless surveys indicate that consumers are concerned about the environment and are open to including environmental considerations into their purchase decision Educating sales staff about the air emissions from lawnmowers and outdoor equipment together with ecolabels could therefore be important methods for influencing consumers towards the purchase of cleaner products

Equipment Usage

The USA Outdoor Power Equipment Institute CARB (cited in USEPA 1998) and the USEPA (USEPA 1998) have made estimates of annual usage rates and average life spans of outdoor equipment for the general consumer user and for the commercial user Table 13 gives USA usage and lifespan range for selected items of powered equipment

26

Table 13 USA Average Usage and Lifespan of Outdoor Garden Equipment For General Consumers and Commercial Users Equipment Annual usage (Hours) Lifespan (years)

General Consumer

Walk- behind mowers 20-25 6 -7

Rear engine ride on mowers 4 6 -7

Chainsaws 7 5-9

Leaf blowers 9-12 5-9

Trimmers 10 5-9

Commercial User

Walk- behind mowers 320 27

Rear engine ride on mowers 380 38

Chainsaws 405 1-13

Leaf blowers 170-293 18-28

Trimmers 170 - 275 15-28

Discussions with members of the Australian industry confirm that Australian hours of use are likely to be similar to the American estimates although this can vary depending on location For example in tropical areas lawns are mowed more often because they grow faster in this climate The American turnover of equipment is however probably higher than here as the Australian consumer tends to keep their equipment longer and so the useful life of a mower is more likely to be on average 10 ndash12 years

52 Garden and Ground Maintenance Services

According to a recent IBIS report (2006b) the revenue for this industry in 2005-06 was $383 million and the industry outlook is lsquobrightrsquo with a predicted annual average 5 growth over the next few years The Australian customer base for garden maintenance services including for lawn mowing is

Households 55 Business 25 Government 20

The sector is reportedly a growth industry due to

bull the aging population

bull the increasing numbers of households that are time poor income rich and

bull the growing trend for professional landscaping which requires a higher level of garden maintenance

27

The main customer base for these businesses includes middle to upper socioeconomic groups the aged and people who are physically disabled Growth is predicted particularly for the franchise industry with demand from the commercialindustrialgovernment sectors (IBIS 2003) A 1999 ABS survey reported that nearly one-third of older people purchased at least one domestic service per fortnight with gardening assistance being the most common This accords with an industry estimate that about 25 of householders pay someone to mow their lawn (Jim Penman Jimrsquos Mowing personal communication) The industry is sensitive to economic conditions and weather for example the drought has slowed growth over the last few years

The garden maintenance sector is dominated by small independent operators with two major franchisers Jimrsquos Mowing and VIP VIP nationally has 600 franchises and Jimrsquos Mowing about 400 Jimrsquos Mowing reportedly mows about 15000 lawns and has 53 of the market (IBIS 2006b) As franchised lawn mowing services represents about 14 of the lawn mowing services nationally it can be estimated that approximately 280000 lawns are mowed nationally by commercial operators

Jimrsquos Mowing and VIP provide training and advice to new franchisees on equipment including proper maintenance schedules Training generally occurs before franchisees purchase their equipment Most franchisees equipment would consist of two mowers a brushcutter an air blower and possibly a hedge trimmer or chain saw Operators prefer four stroke mowers and these are used for an average eight hours per week Brushcutters are generally two strokes as are other motors (IBIS 2006b and Jim Penman personal communication)

From the above it is estimated commercial operators operate mowers for up 34 million hours per year (or 8 of the total estimated mowing hours per year) and purchase approximately 66000 lawnmowers annually (25 of purchases) The sectorrsquos purchases of brushcutters is estimated to be approximately 8000 units per year or 37 of purchases Table 13 provides US commercial userrsquos annual average hours of use and average equipment life spans ndash it would be anticipated Australian rates would be similar

The main businesses contracting to provide ground maintenance services to the corporate and government sector (including universities) are Spotlessrsquos Open Space Management Transfield and Programmed Maintenance Services all of which are diversified publicly listed companies plus the Danish owned company ISS (previously Tempo Services) (IBIS 2003 and 2006b and company websites) The type of services they provide means it is likely they would have an array of equipment and a preference for the more powerful ride-on mowers and for Class V handheld equipment

53 Government Purchasing

The way purchasing decisions are made by government or other large organizations is generally very different to the approach taken by the general household consumer

bull many of the purchases are for large quantities of goods

28

bull there are well established policies and procedures in place to guide purchasing with the purchase criteria established early in the buying process and

bull those making the purchase are likely to be more knowledgeable about the product than the average consumer and they are usually not the eventual user of the goods

Value for money fitness for purpose ability to supply and over recent years environmental aspects are likely to be important factors in the purchasing decision for Government

Local State and Commonwealth Governments have responsibility for the upkeep of public assets many of which include public open space and other outdoors areas At the State and Federal level these include schools universities sporting facilities hospitals and defence facilities These services may be outsourced individual departments may undertake maintenance and purchase their own equipment or they may purchase equipment through a central purchasing facility With the central purchasing facility these items are generally purchased under contract While there is an increase in the inclusion of environmental considerations in the selection criteria for purchasing goods and services especially under contract these considerations mainly relate to waste management and recycling criteria and not air emissions

Local councils in some states for example NSW generally take responsibility for ground maintenance within their council areas or for some smaller councils the service may be contracted to a neighbouring council In other states such as Victoria there is a trend to outsource ground maintenance contracts to commercial providers

It is unknown what proportion of total sales that direct Government purchases represent however it likely to represent a relatively small share of several percent of the overall market

In summary

bull The general household consumer represents the major market segment for garden equipment accounting for up to 90 of product sales

bull Government is likely to be relatively small direct purchaser of garden equipment

bull Commercial garden services to households purchase approximately 25 of lawnmowers per year and 37 of brushcutters

bull Large ground maintenance companies are likely to prefer larger and more powerful equipment such as ride-on mowers

29

6 Result of Stakeholder Consultation

61 Regulations

The Small Engine Expert Panel ndash Outdoor Equipment considered in depth an approach to take to improve the emissions performance of outdoor garden equipment sold in Australia Discussions were particularly focused on the growing influence of cheap high emissions imported products together with the difficulties that the local manufacturer of lawn mowers is likely to face in complying with the relevant overseas standards As part of this process the industry representatives on the Panel held additional discussions and they consulted international industry experts at the manufacturing level in Europe the USA and Japan

OPEArsquos preference is for the adoption of regulations based on the USEPA standards with Phase 1 being adopted possibly from as early as 2007-08 The industry then proposes that Phase 2 be introduced in 2012 Phase 1 USA EPA standards were adopted in the USA in 1995 to be applied to equipment manufactured from 1997 and Phase 2 standards were introduced in 2002 through to 2007 and these included averaging banking and trading provisions A comparison between the USA Phase 1 and Phase2 standards is given in Table 14 The USEPA is discussing Phase 3 limits for the adoption in 20102011 which includes tighter exhaust emission limits for non-handheld equipment

The emissions limit of the two stroke lawn mower manufactured by the sole Australian manufacturer are well above USA Phase 1 limit for non-handheld equipment One avenue to address this issue which was supported by the Expert Panel ndash Outdoor Equipment would be to place lawn mowers in the US EPA Category 5 (engines gt50cc) This would result in emissions for two stroke lawnmowers being limited to 161 gkW-hour HC + NOx compared to the USA regulated limit of 161 gkW-hour HC + NOx Doing this would align the ramp-up timetable for mowers with that of other garden products

Table 14 Comparison between the USA Phase 1 and Phase 2 standards

Emission Limits GkW-hr

Phase 1 (1997 ndash2001) Phase 2 (2007) HC NOx HC+NOx CO HC+NOx CO

Non-handheld I-A lt66cc 161 610 I-B 66-lt100cc 161 610 I 100-225 cm3 161 519 161 610 II 225 cm3 134 519 121 610 Handheld III lt20 cm3 295 536 805 50 805 IV 20-50 cm3 241 536 805 50 805 V 50 cm3 161 536 603 72 603

Phase 2 limits were phased in between 2002 -2007 during which time they became tighter for simplicity only the 2007 are shown in this table (see Table 2 for more details)

30

In addition to limiting emissions the Expert Panel support the inclusion of the durability criteria which apply in the USA under Phase 2 standards and certification documentation from either the USA or Europe as adequate proof of conformity Equipment that has not been tested and certified to USA or European standards will be required to have the engines tested in a NATA certified laboratory

Some in the industry argued that regulations should include provisions for averaging for companies that wish to use it however they felt banking and trading provisions would not be necessary Industry representatives were not supportive of any Australian consumer labeling requirement instead OPEA members are willing to supply emissions data for inclusion in a web-based database that would allow purchasers to assess the environmental credentials of different makes and models

62 Discussion on recommended regulations

Timing of introduction

Some industry representatives argue that introduction of Phase 1 standards in 2007-08 will not give the industry an adequate transition period in which to develop competence in emissions certification establish new procedures and tooling in the dealers workshops train dealers and technicians on legal requirements distribute specific tooling and spare parts and reduce stocks of old (non certified) products without incurring an undue financial burden While others in the industry prefer progressing straight to phase 2 standards

If the OPEA preference for the adoption of the United States Phase 1 regulations which operated in the USA between 1995 and 2001 were introduced in Australia in 2007-08 they would be well behind the USA standards and worldrsquos best practice Furthermore the introduction of the United States Phase 2 - 2007 limits in Australia in 2012 would if the USEPA introduce Phase 3 in 2010-11 see emission limits for lawnmowers and other non handheld garden equipment in Australia still lagging United States standards and worldrsquos best practice

To introduce regulations in 2007-08 will require Government firstly to determine the most appropriate mechanism under which to enact the regulations draft the regulations prepare the regulatory impact assessment consult with the broader community and then finalise the regulations It is likely an Act of Parliament will be required at the Commonwealth level followed by complementary legislation at the State and Territory level It is possible for this to be achieved in less than a two year timeframe (as was the case for the Water Efficiency Labelling Scheme) However regulations that do not have a level of perceived urgency would take longer The level of importance and urgency to control emissions from small engines has yet to be debated and determined

31

Modified USEPA limits for lawnmowers

From the 183 lawn mowers identified through the market survey Victa is the main (possibly sole) provider of two stroke mowers with the other lawnmowers having cleaner four stroke engines

Victa is undertaking work to produce a cleaner product Victa estimates it would need a number of years to complete development production tooling and commercialisation of the cleaner engines In January 2007 it released a new two stroke carburettor lawnmower that has reduced engine emissions by more 30 but the combined HC and NOx emissions are still above USEPA Phase 1 limits Victa says this new engine is the outcome of four years of collaborative work by Victa and the University of Technology Sydney Victa is continuing with this research to further reduce emissions

A clause that allows exemptions to be granted as occurs in other countries could be included in the regulations however Victa argues that this would create uncertain trading conditions for the company for a period of time until an exemption were granted

Placing lawn mowers in the US EPA Category 5 (engines gt50cc) has the risk of opening the Australian market to more two stroke lawn mowers which has the greatest use of any outdoor powered equipment however it should see the continuance of the sole engine being manufactured in Australia In 1995 when it was introducing small engine emission limits the USEPA faced a similar issue with two stroke lawn mowers and used a similar approach by allowing two stroke lawn mowers to comply with the handheld standards It also specified that the number of two stroke lawnmower engines allowed to meet handheld standards would be subject to a declining annual production cap with the allowance provided by the production cap being phased out in 2003 There is also similar precedent for small engine emission limits that depend on engine type - European regulations for marine outboard motors set less stringent requirements for two stroke motors

Averaging Banking and Trading Provisions

The US EPA did not have averaging banking and trading provisions in Phase 1 and therefore all small outdoor engines were required to meet the Phase 1 limits It only introduced ABT provisions in the much more stringent Phase 2 as they would allow the most economic introduction of cleaner engines The industry claims the systems to use this provision are available and can be implemented in Australia by those who wish to use it at little cost to government

Industry claim that any supportive economic data related to averaging is sensitive and confidential It is there difficult without substantial justification by the industry to support the provision for averaging in conjunction with Phase 1 particularly given the elapsed time between the introduction of Phase 1 in the USA and their recommended introduction in Australia If there are some low volume equipment items that still cannot meet the USAEPA Phase 1 standards then these could be subjected to

32

exemptions if adequate justification can be provided (exemptions for small volumes were available under the USEPA regulations)

It was noted that for government to implement regulations a regulatory impact statement is required and this requires an assessment of the costs and benefits of the options considered with clear overall benefits shown for the preferred option Therefore if the option for manufacturers to use averaging were to be considered more information to support its inclusion would be required

Other options that could be considered to circumvent the inclusion of averaging include

i including clauses that give manufacturers the ability to apply for exemptions from the regulations for classes of equipment that have small sales volumes (these provisions are available in the USA)

ii limiting the regulation to popular types of equipment

iii using the end-of-model life provisions that have been used in the Australian Design Rules for cars In effect the end of model life provisions require new designs to comply from the implementation date but allow older models to remain on sale for a few more years This is an alternative to ABT because it facilitates earlier introduction of the regulation

iv Having a phase in period of say 2 years during which existing models can continue to be sold but new models coming on to the market must comply with the new standards At the end of the phase-in period all models must comply with the new standards This is an approach that is used when Australian Design Rules (ADRs) are introduced for motor vehicles

Consumer Information

Current Australian directions to reduce the environmental impact of consumer products favor tiered benchmarks using a lsquostarrsquo rating system (see Appendix 3 for examples such as the Mandatory Energy Efficiency Label and the Water Efficiency Labelling Scheme)

As products generally arrive in Australia assembled and packaged industry considers a mandatory requirement to label products with an Australian style star rating would impose a cost on distributors that would drive up the retail price of products Instead the OPEA members were willing to supply emissions data for inclusion in a web-based database that would allow purchasers to assess the environmental credentials of different makes and models Given the diverse nature of the industry it is unlikely a database would provide complete coverage of all products on the Australian market but inclusion in the database would indicate that the manufacturer has a commitment to environmental performance It was acknowledged in discussions that at least some Phase 2 compliant products would become available prior to 2012 and the web-based database would provide one method to promote those cleaner engines

33

In summary the Recommendations of the Expert Panel

1 Mandatory air pollutant emission standards to be introduced in Australia for all outdoor equipment (lt19kW) powered by spark-ignition engines The development of any regulation would need to be based on a formal assessment of the costs and benefits of nationally regulating 2 and 4 stroke lawn mowers and handheld power equipment which should be commenced immediately

2 Proposed standards to mirror US EPA regulations (compliance with equivalent EU regulations also acceptable)

3 Timing (subject to completion of assessment of costs and benefits)

(a) US EPA Phase 1 ndash Effective from 2007 2008

(b) US EPA Phase 2 ndash Fully implemented in 2012 (in step with 2007 USEPA limits) with phase-in period andor ABT over 2008-2012 to provide for early introduction of cleaner product

4 Walk-behind 2 stroke mowers to be included in US EPA Category 5 (gt50cc) product classifications Implementation timing to be as in Recommendation 3 above

5 All products also to be certified to relevant EPA durability categories

6 Subject to further review ABT (if included) may be phased out after 2012

34

7 The Way Forward

The optimum approach for garden equipment out engine emissions of options needs to be sustainable and cost effective This will need to be determined through a costs and benefits analysis (CBA) CBA assigns monetary values and typically assesses the impacts on the consumer on human health on the environment on industry and on government A detailed costs and benefits analysis is beyond the scope of this report however the following sections draws on available information to provide some indication of the possible costs and benefits that are associated with emissions from garden equipment engines

Air Quality Benefits

Environment Canada estimated the introduction of the regulations would result in a 44 percent reduction in combined HC+NOx emissions from small engines used in garden equipment and reduction in individual air pollutants over a 25 year period as shown in Table 15 The Canadian estimates incorporate the benefits that would accrue from the MOU signed with the industry in 2000 plus the benefits from the regulations introduced in 2003 In 2000 Canada imported around 13 million small spark-ignition engines and machines (ie a similar number to Australia) with 80 supplied by the USA

Table 15 Canadian Small Spark-Ignition Engine Emissions in Year 2025

Substance Base Case Emissions in 2025

Emissions in 2025 with Regulations

Percentage Reduction in 2025 (Regulations vs Base Case)

Criteria Air Contaminants (kilotonnes)

HC 772 410 469

NOx a 84 67 201

CO 1413 1403 07

Greenhouse Gas (kilotonnes)

CO2 2903 2645 89 Base case year 2000 (accommodating voluntary agreement) Source Canada Gazette Part II Vol 137 No 24 2003-11-19

Other Environmental Costs and Benefits

In addition to the human health benefits associated with reduced exposure to ozone there is a range of other public benefits including reduced damage to vegetation and therefore higher crop yields less damage to materials and structures particularly

35

some rubber products and improved visibility due to a reduction in smog haze Plus there are benefits associated with lower emissions of other air pollutants

To date there appears to have been little work undertaken in assigning a monetary value to these benefits as it is considered that they are likely to be small compared to human health impacts

Health Costs and Benefits

The Final Impact Assessment for the Ambient Air Quality National Environment Protection Measure (NEPC 1998) estimated that the health damage costs from exposure to ozone nationally to be in the range of $90 ndash $270 million (in 1998 dollars) This figure did not include mortality costs because of difficulty in assigning a figure to human life nor did it include costs associated with minor symptoms such as sore throat cough headache chest discomfort and eye irritation that can result from ozone exposure On the cost of ozone exposure the Impact Assessment states that lsquothe social well-being associated with potentially 6 and 20 million fewer irritating symptoms annually cannot be reliably quantified but at $1 a symptom it adds up to an appreciable amountrsquo

Since the Air NEPM Impact Assessment ozone levels in Australian urban areas have not fallen significantly but the population and medical costs have increased since then However using the above figures to make a rough estimate the contribution made by engines used in lawnmowers (ie not including other garden equipment) to the health damages cost from ozone exposure would be at a minimum $36 - $108 million not including the cost of mortality or minor symptoms As any action on these engines is likely to only remove high emission engines over a decade or more a CBA would be required to include an assessment of the proportional health benefits that would accrue from only removing the high emitters over time

Costs and Benefits to the Consumer

In 1995 the USEPA estimated that on average the cost to the engine manufacturer to install the necessary emission control technology to meet Phase 1 standards (which didnrsquot have ABT) would be approximately $US2 per engine used in nonhandheld equipment and $US350 per engine used in handheld equipment It also estimated that this would translate to sales-weighted average price increases of about $US7

The introduction of phase 2 regulations USEPA estimated would result in price increases of between $US20 and $US64 for handheld equipment depending on the equipment class (USEPA 2000) where handheld engines ranges in price from $60 to $1000 (USEPA 1995)

In addition to emission reductions the implementation of exhaust emission limits has the advantage of reducing fuel consumption and lowering operating costs to the consumer For example the USEPA estimated that for Phase 1 limits that applied between 1995 and 2001 on an average sales-weighted engine basis would decrease fuel consumption by 26 percent for non handheld equipment and a 13 percent decrease in fuel consumption for handheld equipment (USEPA 1995) Phase 2

36

(current limits) would result in a further decrease in fuel consumption of approximately 30 percent for handheld engines

When the USEPA considered the fuel savings offset and the retail price increase it estimated that the average sales-weighted lifetime increase in cost would be about $US650 per handheld engine while nonhandheld engines will realize a lifetime savings of about $US250 per engine This does not include the lifetime savings in maintenance costs which should further benefit the consumer (USEPA 1995)

Euromot (The European Association of Internal Combustion Manufacturers) claims that compliance with European minimum performance standards that do not have ABT provisions adds around 30 to the cost of some products that have had to be brought into compliance4 compared to products sold under the ABT system in the US

Costs and Benefits to Industry and Government

As there is only one local manufacturer among the 43 distributors of powered outdoor garden equipment sold in Australia and all others are importers the main costs to reduce the emissions contribution made by these engines will be associated with program administration and compliance particularly if regulations are introduced

The Productivity Commission an independent agency which is the Australian Governmentrsquos principal review and advisory body on microeconomic policy and regulation recently examined the cost effectiveness of measures to improve the energy efficiency in household appliances As part of its review lsquoThe Private Cost Effectiveness of Improving Energy Efficiencyrsquo it examined labelling programs (ie regulated tiered benchmarks) and minimum mandatory energy efficiency requirements (ie a regulated simple benchmark) While the household appliance market is considerably larger than the garden equipment market the Commissionrsquos final report contains some information that is useful for determining the approach that could be used to establish an emissions reduction scheme for garden equipment A summary of relevant sections of this report is provided in Appendix 3

The Commission identified both administration and compliance costs associated with labelling programs and minimum mandatory energy efficiency requirements as well the impacts these had on product suppliers

The Department of the Environment and Water Resources provided details to the Commission on the costs involved in administering both the labelling scheme and the minimum performance standards for energy programs The information provided showed that

bull the administration costs of the simple benchmark approach were substantially lower (less than one tenth) than for labelling and 84 per cent of administration costs were passed on to appliance purchasers with the remainder borne by governments

4 Presentation by Dr Holger Lochmann Rob Baker Axel Rauch Stihl 19 April 2006

37

bull the compliance costs for labelling are higher

bull minimum mandatory energy efficiency requirements can have a greater cost for suppliers than labelling since suppliers must adjust their model ranges to meet the MEPS levels by the given date These compliance costs are however influenced by the lsquolead inrsquo time between introduction and the implementation of the regulations

bull The increased cost to appliance purchasers of labelled appliances was about two and half times higher compared to appliances purchased under minimum mandatory energy efficiency requirements this being due to consumers voluntarily purchasing more efficient appliances

Overall the Commission considered that labels should be more actively considered as an alternative to minimum performance standards The Commissionrsquos support was based on the ability of labels to amongst other things

bull directly address ldquoa source of market failure mdash the asymmetry of information between buyers and sellers of energy-using productsrdquo

bull provide information to the consumer that is readily-accessible and easily-understood so they can help the consumer make better-informed choices

bull Have net social benefits and possibly have net benefits for consumers

bull provide a greater incentive for suppliers to sell environmentally better products

bull warn consumers through a disendorsement label that an appliance is very inefficient This approach can discourage but not prevent consumers from buying the poor performing product

71 Options to Reduce Emissions from Garden Equipment Engines

There is a range of options that could be considered for reducing emissions from engines used in outdoor garden equipment in Australia These include

1 Do nothing

2 Partnership Programs

3 Quasi regulation

4 Co-regulation

5 Regulations

In the following discussion about these options many Australian examples are mentioned Further details about these programs plus an overview are provided in Appendix 2

38

72 Option 1 ndash Do Nothing

Based on data supplied by OPEA the sales of high emitting two stroke carburettor engines as a percentage of engines used in outdoor equipment increased during the period 2002 to 2005-6 (see Table 12) from 463 to 593 and overall sales number increased by 38 during that period There is no indication that in the short to medium term that sales of equipment with two stroke carburetor engines will decrease in overall sales numbers or as a percentage of sales Therefore under the lsquodo nothingrsquo option emissions from outdoor garden equipment will continue at the same rate or perhaps based on sales figures of two stroke carburetor powered equipment at an even higher rate in the future

73 Option 2 ndash Industry - Government Partnership

In the discussion papers prepared for the NSW small engine project (2004) some examples of successful voluntary Government-Industry Partnership programs were provided The examples included were

bull the National Industry Reduction Agreement where the major newspaper and magazine publishers in Australia agreed to promote recovery and recycling of old newspapers and magazines

bull the NSW EPA-Oil Industry MOU on Summer Fuel the National Packaging Covenant (which has legislative backup) and

bull the EPA Victoriarsquos agreement with the Altona Chemical Complex

From the Australian programs reviewed it appears that the best indicators for successful partnership programs are

bull a relatively small number of firms within the industry

bull a commitment and involvement by all of the industry

bull clear program aims and objectives plus program targets and

bull a willingness by the industry to enter into a cooperative partnership with government

There are 43 identified distributors selling 97 brands of outdoor powered equipment in Australia Many of the major distributors are members of OPEA but there are many distributors who are not members It is therefore unlikely that the even the majority let alone all of the Australian distributors would commit to a industry-government partnership to reduce emissions

74 Option 3 - Quasi Regulation

Quasi regulations can take a range of forms the most usual being the establishment of a code of practice that industry endorses and implements A fundamental part of the code of practice would be emissions standards There are few examples of the use of codes of practice to limit emissions

39

Governmentrsquos role under this scenario is likely to be in assisting in the development of standards

The likelihood of this option being successful for similar reasons to the industry government partnership option is low

75 Option 4 -Co Regulation

Co-regulation is an agreement by industry and government to certain undertakings that support the uptake of cleaner products with a regulatory base It allows industry program flexibility to achieve certain negotiated targets Australian examples of coshyregulation include

bull The Green Vehicle Guide which operates through an industry government agreement where industry report test results to government in an agreed format within a certain timeframe Government manages the data and promotes the program This program is underpinned by Australian Design Rules for motor vehicles

bull The electrical appliance stand-by power program where there are agreed targets established that industry is required lsquovoluntarilyrsquo to meet failure to achieve the targets will result in regulation

bull The Packaging Covenant which is a program that allows industry the flexibility to design it own programs to reduce packaging waste and achieve certain target The Covenant is complemented by the NEPM on used packaging which specifies certain government responsibilities to support the program plus measures that will be introduced if targets are not met

Given the large number of distributors on the Australia market co-regulation for engines used in garden equipment using a similar form to the standndashby power program or the packaging program - an agreement by industry and government on a percentage reduction target for the sale of high emitting engines within a specified timeframe together with an agreement that regulation will be adopted if the target is not met ndash is also unlikely to be successful

76 Option 5 - Regulation

Regulation which requires a clear acknowledgement of a sufficient problem by Government places uniform mandatory compliance obligations on industry The costs associated with regulations are usually shared between government and industry with the development of regulations and program administration costs being borne by government with industry meeting compliance costs including emissions testing and if applicable labelling costs

It could argued that regulation should be introduced in the States or Territories where there are exceedances of the Air NEPM ozone standards However development of state based regulations for garden equipment engines emissions is unlikely as they would be incompatible with the 1992 Intergovernmental Agreement on the

40

Environment signed by the Commonwealth States and Territories and existing Commonwealth and State Government mutual recognition legislation The Intergovernmental Agreement on the Environment which underpins the development of National Environment Protection Measures obligates all jurisdictions to ensure equivalent protection from air pollution to all Australians

In addition enforcement of any state based legislation would be a key problem Under the Commonwealth Mutual Recognition Act 1992 and the Trans-Tasman Mutual Recognition Act 1997 goods that are imported into or produced in an Australian State or Territory or New Zealand that can be sold lawfully in that jurisdiction can be sold freely in a second jurisdiction even if the goods do not comply with the regulatory standards of the second jurisdiction This means non-regulated small engine products legally sold in one State could be legally sold in any other state regardless of whether emissions limits on small engines applied in that State

National regulation on the other hand would provide national consistency It would also provide the opportunity to adopt worldrsquos best practice standards and incorporate penalties for non-complying parties

Under the Australian Constitution the Commonwealth does not possess specific legislative powers in relation to the environment and heritage There are however a number of legislative powers that can support environment and heritage legislation Furthermore Commonwealth legislative powers can be used cumulatively For example the Commonwealth Parliament can make laws under section 51(20) of the Constitution with respect to ldquoforeign corporations and trading or financial corporations formed within the limits of the Commonwealthrdquo

Legislative mechanisms may also be created through the development of a National Environment Protection Measure (NEPM) that then becomes law within each jurisdiction A NEPM can accommodate flexibility of implementation where jurisdictions that have elevated ozone levels can tailor their NEPM program to their specific air quality needs An example of this flexible approach is the Diesel NEPM which has a suite of programs which can be implemented by jurisdictions

From the review of Australian regulations to reduce the environmental impacts of products and the overseas approaches to control emissions from small engines two regulatory approaches become apparent a simple benchmark or tiered benchmarks These are outlined below

Regulatory Option1 - A Simple Benchmark Approach

The most basic regulatory approach that could be taken would be to have a single emission standard (or as per the USA Europe and California a number of emission standards based on power and application) for combined HC + NOx emissions All equipment with new engines sold in Australia from the date the regulations are introduced This approach would

bull remove the all high emission engines from sale

41

bull be supported by an Australian Standard and

bull provide consumers with confidence that all products meet certain emissions standard

Regulatory Option 2 -Tiered Benchmarks

Current Australian directions to reduce the environmental impact of consumer products favour tiered benchmarks using a lsquostarrsquo rating system (see Appendix 2 for examples)

For engines used in garden equipment a tiered emissions labelling system could be based on the USEPA Phase 1 and Phase 2 standards use a system of lsquostarsrsquo to provide information to consumers about environmental performance but not limit consumer choice A tiered lsquostarrsquo system approach would

bull reward those products with more stars that meet the more stringent overseas standards

bull either operate with minimum emissions performance standards or disendorsement labels

bull be supported by a product label and possibly a web database

bull provide consumers emissions information and the option to purchase a lower emission engine

bull be supported by an Australian Standard and

bull be devised to meet worldrsquos best practice which is an overarching approach supported by Government

Table 16 summarises the main strengths and weaknesses of the above options

42

Table 16 Main Strengths and Weaknesses of Each Option

Strengths Weaknesses

Do Nothing Does not limit consumer choice Emissions contribution likely to grow No cost to government No barrier to new market entrants selling

high emitters Consumers have a wide choice of products Industry unchecked amp product dumping

likely No enforcement recourse on environmental grounds available

Partnerships Some sharing of responsibility government Slow if any reduction in high emitters

ndash industry

Potential for Government assist in Few if any companies likely to join and no advancing reductions in high emitters restrictions on non signatories Reduction targets set Below worldrsquos best practice

Quasi Regulation Similar strengths to partnership option Similar weaknesses to partnership option as

few if any companies likely to adopt code of practice

Co-Regulation Ongoing consultation between industry and Due to industry diversity targets unlikely to government recourse to regulation be met Targets set and can require new market Slow reduction in emissions entrants to achieve targets Can have implementation flexibility Emissions test standard adopted

Regulation Option 1- Simple Benchmark Worldrsquos best practice standards can be ovide incentives to manufacturers to promote low adapted and is mandatory emitters

Recourse to legal action available for non Does not provide consumers with emissions compliance information Significant quantifiable health benefits Cost of enforcement borne by taxpayers Requires compliance by all industry and High cost to government bans high emitters

Regulation Option 2 ndash Tiered Benchmarks Provides consumers with emissions information but does not limit choice Incentives for manufacturers to sell low emitters Potentially significant quantifiable health benefits Can be designed to overcome ABT issue

Significant administration and compliance costs to Government High cost to government and industry and will increase retail price of engines Does not ban high emitters

43

77 Preferred Approach

From the above discussion and from the review of garden equipment on available to the Australian consumer there are many companies selling powered garden equipment on the Australian market and the market is very competitive Furthermore from the Expert Panel discussions and stakeholder consultation it is apparent that it is highly unlikely that all the companies in the garden equipment industry would engage in or commit to a voluntary program to reduce their productsrsquo exhaust emissions It is therefore clear that the only feasible path to reduce emissions from these small engines is through regulation

While regulations of emissions from small engines used in garden equipment in Australia are likely to be based on overseas regulations they need to strike a balance between improved environmental outcome harmonisation with international standards and the characteristics of the local industry With regulation optimum emissions reductions are achievable especially by combining minimum emissions standards with tiered product labelling Whether this approach is justifiable on economic grounds that is the benefits outweigh the costs can only be determined through a detailed impact assessment Based on these findings it is recommended that a formal assessment of the costs and benefits of nationally regulating 2 and 4 stroke lawn mowers and handheld power equipment should now be commenced

44

References Air Resources Board California Environmental Protection Agency Californian Exhaust Emission Standards and Test Procedures for 2005 and Later Small Off-road Engines July 26 2004

Artcraft 2003 A Major Research-Based Review and Scoping of Future Directions for Appliance Efficiency Labels in Australia and NZ prepared for the Australian Greenhouse Office viewed at wwwenergyratinggovaulibraryindexhtml

Australian Bureau of Statistics 1999 Older People Australia A Social Report Report Number 41090 December 1999

Australian Greenhouse Office 2002 Achievements 2002 National Appliance equipment energy efficiency program Commonwealth of Australia

Australian Greenhouse Office 2002 Achievements 2002 National Appliance equipment energy efficiency program Commonwealth of Australia

AustralianNew Zealand StandardtradeASNZS 64002005 Water efficient productsmdashRating and labeling Federal Register of Legislative Instruments F2005L01571

Bei L T and Widdows R1999 Product knowledge and product involvement as moderators of the effects of information on purchase decisions a case study using the perfect information frontier approach Journal of Consumer Affairs 33(1) 165-186

Buy Recycled Busines Alliance Briefing Paper Environmental Claims And Labelling Abstract lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10-2003

California Code of Regulations 1998 Final Regulation Order Article 1 and Article 3 Chapter 9 Division 3 Title 13 Attachment 1 26 March 1998 wwwarbcagovregactsoreregs_finpdf

Canada Gazette Part II Vol 137 No 24 2003-11-19

Canadian Gazette 29 March 2003 Vol 137 No 13 Part 1 pp 935- 955

Cap Gemini Ernst amp Young (2001) Cars Online 2001 Global consumer survey httpa593gakamainet75931951a8b278a28319eawwwcgeycomhightechautomediaC ars_online2pdf

Clothes Washers Australiarsquos Standby Power Strategy 2002 ndash 2012 Standby Product Profile 200308 October 2003 wwwenergyratinggovau

Craig ndash Lees M Joy Sally Browne B 1995 Consumer Behaviour John Wiley amp Sons Queensland 1995

Department of Environment and Conservation NSW 2004 Measures to Encourage the Supply and Uptake of Cleaner Lawnmowers and Outdoor Handheld Equipment

45

Department of Environment and Conservation 2003 Who cares about the environment in 2003 A survey of NSW peoplersquos environmental knowledge attitudes and behaviours DEC Social Research Series

Department of Environment and Conservation Action for Air update 2006

Department of Environment and Conservation The Buy Recycled Guide Online Directory viewed at wwwresourcenswgovauindex-RNSWhtm

EcoRecycle 2004 Paint Take-Back Takes Off in Bayswater Media release 24 March 2004 viewed at wwwecorecyclevicgovau May 2004

Enviromower viewed at wwwenviromowercomau June 2004

Environment Canada 2000 Future Canadian Emission Standards for Vehicles and Engines and Standards for Reformulation of Petroleum Based Fuels Discussion Paper in Advance Notice of Intent by the Federal Minister of the Environment April 2000 wwwecgccaenergfuelsreportsfuture_fuelsfuture_fuels1_ehtm

Environment Canada 2004 Environment Minister Urges Canadians to Reduce Greenhouse Gas Emissions and Mow Down Pollution With Unique Incentive Program Media Release April 23 2004 viewed at wwwecgccamediaroomnewsrelease May 2004

Environment Protection and Heritage Council National Environment Protection (Ambient Air Quality) Measure Report on the Preliminary Work for the Review of the Ozone Standard October 2005

Environment Protection Authority 2006 Victoriarsquos Air Quality ndash 2005 Publication 1044 June 2006 wwwepavicgovau

Environmental Choice NZ 2001 Public Good and Environmental Labelling An Internal Background Paper

European Commission Directive 200344EC amending the recreational craft directive and comments to the directive combined 211005

George Wilkenfeld and Associates Pty Ltd with Artcraft Research and Energy Efficient Strategies Tomorrow Today 2003 Final Report A Mandatory Water Efficiency Labelling Scheme for Australia Prepared for Environment Australia June 2003

George Wilkenfeld and Associates 2003 A National Strategy for Consumer Product Resource Labelling in Australia prepared for the Australian Greenhouse Office December 2003 viewed at wwwenergyratinggovaulibraryindexhtml

Green Vehicle Guide wwwgreenvehicleguidegovau

Harrington L and Holt S 2002 Matching Worldrsquos Best Regulated Efficiency Standards ndash Australiarsquos success in adopting new refrigerator MEPS wwwenergyratinggovaulibrarypubsaceee-2002apdf

46

Harris J and Cole A 2003 The role for government in ecolabelling ndash on the scenes or behind the scenes lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10-2003

Holt S and Harrington L2003 Lessons learnt from Australiarsquos standards and labeling program Paper presented at ECEEE Summer Study - 2-6 June 2003 wwwenergyratinggovaulibraryindexhtml

IBIS 2006a Domestic Hardware Retailing 09-Jun-2006 Industry Code G523b

IBIS 2006b Gardening Services 18-Jan-2006 Industry Code Q9525

IBIS 2003 Gardening Services in Australia 23 December 2003 Industry Code Q9525

Lawrence K Zeise K amp Morgan P 2005 Management Options for Non-Road Engine Emissions in Urban Areas Consultancy report for Department for Environment amp Heritage Canberra

Motor Vehicle Environment Committee (MVEC) in consultation with the Department of Transport and Regional Services 2002 Proposal for an Australian ldquoGreen Vehiclesrdquo Guide viewed at httpwwwdotarsgovaumvegreen_vehicles_guidedoc May 2004

National Appliance and Equipment Energy Efficiency Committee The Energy Label at wwwenergyratinggovau (3504)

National Environment Protection Council 2005 National Environment Protection (Ambient Air Quality) Measure Report on the Preliminary Work for the Review of the Ozone Standard October 2005

National Environment Protection Council 1998 Final Impact Assessment for Ambient Air Quality National Environment Protection Measure June 1998

National Environment Protection Council 1999 Used Packaging Materials Impact Statement for the Draft NEPM Used Packaging Material January 1999 viewed at wwwephcgovau

National Environment Protection Council 2004 National Environment Protection (Air Toxics) Measure April 2004 viewed at wwwephcgovau

New South Wales Government 2002 Protection of the Environment Operations (Clean Air) Regulation 2002

New South Wales Government 1999 NSW Government Procurement Policy Statement White Paper 1999

Nordic Council 2002 Ecolabelling of marine Engines Criteria Document 8 December 1995 ndash 6 December 2005 version 35 December 2002

47

Office of Public Sector Information Statutory Instrument 2004 No 2034 The Non-Road Mobile Machinery (Emission of Gaseous and Particulate Pollutants) (Amendment) Regulations 2004 wwwopsigovuksisi200420042034htm

Outdoor Power Equipment Institute 2001 Profile of the Outdoor Power Equipment Industry wwwopeiorg

Productivity Commission 2004 The Private Cost Effectiveness of Improving Energy Efficiency Final report October 2005 wwwpcgovauinquiryenergy

Publishers National Environment Bureau Media Release lsquoAustralia leads the world in newspaper recyclingrsquo 6 June 2006 wwwpnebcomau

Real J Jones A 2005 The Green Vehicle Guide Clean Air Soceity of Australia and New Zealand Conference 2005 Hobart

Salmon G Voluntary Sustainability Standards and Labels (VSSLs) The Case for Fostering Them OECD Round Table On Sustainable Development

Schkade D A and Kelinmutz D N 1994 Information displays and choice processes differential effects of organization form and sequence Organizational Behavior and Human Decision Processes 57(3) 319-337

Stephens A 2003 Eco Buy (Local Government Buy Recycled Alliance Victoria) Abstract lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10shy2003

Teisl M F Roe B and Hicks RL 2002 Can eco-labels fine tune a market Evidence from dolphin-safe labeling Journal of Environmental Economics and Management 43339-359

Teisl M F Roe B and Levy A S Ecolabelling What does consumer science tell us about which strategies work pp141-150

The ISO 14000 family of standards guides and technical reports

The Parliament of the Commonwealth of Australia 2004 House of Representatives Water Efficiency Labelling and Standards Bill 2004 Explanatory Memorandum wwwcomlawgovauComLawLegislationBills1nsf viewed February 2006

Thogerson J 2000 Promoting green consumer behaviour with eco-labels Workshop on Education Information and Voluntary Measures in Environmental Protection National Academy of Sciences ndashNational Research Council Washington DC November 29-30

United States Environmental Protection Agency Federal Register Vol 60 No 127 3 July 1995 Control of Air Pollution Emission Standards for New Nonroad Spark-ignition Engines At or Below 19 Kilowatts wwwepagovEPA-AIR1995JulyDay-03prshy805txthtml

48

United States Environmental Protection Agency Federal Register Vol 69 No 7 12 January 2004 Rules and Regulations 40 CFR Part 90 Amendments to the Phase 2 Requirements for Spark-Ignition Nonroad Engines at or Below 19 Kilowatts Direct Final Rule and Proposed Rule wwwepagovfedrgstrEPA-AIR2004JanuaryDay-12a458pdf

United States Environmental Protection Agency Office of Pollution Prevention and Toxics Pollution Prevention Division 1998 Ecolabelling Environmental Labelling - A Comprehensive Review of Issues Policies and Practices Worldwide

United States Environmental Protection Agency Office of Transportation and Air Quality March 2000 Regulatory Announcement Final Phase 2 Standards for Spark-Ignition Handheld Engines

United States Environmental Protection Agency 1998 Proposed Phase 2 Emission Standards for Small SI Engines 27 January 1998

United States Environmental Protection Agency 2000 Regulatory announcement Final Phase 2 Standards for Small Spark-Ignition Handheld Engines March 2000 EPA420-F-00shy007

United States Federal Register Vol 69 No 7 Monday January 12 2004 Rules and Regulations Environmental Protection Agency 40 CFR Part 90 Amendments to the Phase 2 Requirements for Spark-Ignition Nonroad Engines at or Below 19 Kilowatts Direct Final Rule and Proposed Rule United States Federal Register Vol 64 No 60 30 March 1999 40 CFR Part 90 Phase 2 Emission Standards for New Nonroad Spark-Ignition Nonhandheld Engines At or Below 19 Kilowatts Final Rule pp15214-15216

United States Federal Register Vol 65 No 80 25 April 2000 40 CFR Parts 90 and 91 Phase 2 Emission Standards for New Nonroad Spark-Ignition Handheld Engines at or Below 19 Kilowatts and Minor Amendments to Emission Requirements Applicable to Small Spark-Ignition Engines and Marine Spark-Ignition Engines Final Rule pp24282-24284

United States Environmental Protection Agency Control of Air Pollution Emission for New Nonroad Spark-ignition Engines At or Below 19 Kilowatts Final Rule 40 CFR Parts 9 and 90 1995 wwwepagovEPA-AIR1995JulyDay-03pr-805txthtml

United States Environmental Protection Agency Office of Pollution Prevention and Toxics Pollution Prevention Division 1998 Ecolabelling Environmental Labeling- A Comprehensive Review of Issues Policies and Practices Worldwide

Victorian Government Greenhouse Strategy Community Action Fund - Mow Down Lawn Mower Rebate Exchange Program wwwgreenhousevicgovaucommunitygrantscafsuccessfulprojectshtm

Water Efficiency Labelling and Standards Act 2005 No 4 wwwcomlawgovauComLawLegislation

49

Water Efficiency Labelling and Standards Determination 2005 wwwcomlawgovauComLawLegislationLegislativeInstrument1nsf

Water Efficiency Labelling and Standards Regulations 2005 wwwcomlawgovauComLawLegislationLegislativeInstrument1nsf

Wilkie W 1994 Consumer Behaviour John Wiley and Sons NY as cited in Craig ndash Lees M Joy Sally Browne B 1995 Consumer Behaviour John Wiley amp Sons Queensland 1995

wwwenergyratinggovau

wwwgreenvehicleguidegovau

wwwwaterratinggovau

50

Appendix 1 Detailed Breakdown of Powered Garden Equipment on the Australian Market

The following table gives a profile of the current equipment on the Australian market It is based mostly on distributor responses to a survey and might not be representative of the total market

Low sales indicates that no sales data was available but volumes are likely to be small compared with popular equipment Phase 1 is US EPA Phase 1 or EU Directive 200288EU Phase 2 is US EPA Phase 2 or Euro standards

Type Ranges Stroke Aerator 5 makes 6 models Sales Low

Engine power 26 to 172kW Engine displ 143-674 ml

2c -4c 5 Unspecified 1 Phase 1 - Phase 2 4

Auger 3 makes 5 models Sales Low

Engine power 12 to 16kW Engine displ 31-ml

2c 5 4c -Unspecified -Phase 1 1 Phase 2 1

Backhoe 0 makes 0 model Sales Low

(2 models in 2003) -

Blower 13 makes 49 models Sales 109K

Engine power 07 to 31kW Engine displ 24-80ml

2c 34 4c 2 Unspecified 13 Phase 1 10 Phase 2 17

Blower-wheeler 3 makes 6 models

Engine power 07 to97kW Engine displ 24-305ml

2c 1 4c 4 Unspecified 1 Phase 1 3 Phase 2 -

Blowervac 6 makes 9 models Sales

Engine power 07 to 11kW Engine displ 24-34ml

2c 6 4c -Unspecified 3 Phase 1- Phase 2 3

Brush cutter 12 makes 95 models Sales 339K

Engine power 06 to 23kW Engine displ 21-54ml

2c 66 4c 5 Unspecified 24 Phase 1 15 Phase 2 34

Chainsaw 9 makes 106 models Sales 152K

Engine power 1 to 58kW Engine displ 26-122ml

2c 74 4c -Unspecified 32 Phase 1 18 Phase 2 27

Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

51

Type Ranges Stroke Clearing saw Engine power 14 to 27kW 2c 6 3 makes Engine displ 36-57ml 4c 0 9 models Unspecified 3 Sales low Phase 1 4 Phase 2 -Cultivator Engine power 07 to 52kW 2c 2 4 makes Engine displ 25-190ml 4c 5 7 models Unspecified -Sales low Phase 1 - Phase 2 5 De-thatcher Engine power 1kW 2c 1 1 makes Engine displ 27ml 4c -1 models Unspecified -Sales low Phase 1 - Phase 2 1 Drill Engine power 1kW 2c 3 3 makes Engine displ 27ml 4c -4 models Unspecified 1 Sales low Phase 1 - Phase 2 1 Edger Engine power 1 to 4kW 2c 12 10 makes Engine displ 24-190ml 4c 11 36 models Unspecified 1 Sales Phase 1 3 Phase 2 22 Garden tractor Engine power 12 to 157kW 2c -2 makes Engine displ 465 to 675ml 4c 5 12 models Unspecified 9 Sales low Phase 1 - Phase 2 3 Grass trimmer Engine power- 2c 3 1 make Engine displ 31ml 4c -3 model Unspecified -Sales Phase 1 - Phase 2 3 Hedge trimmer Engine power 06 to 1kW 2c 28 10 makes Engine displ 21-31ml 4c 1 42 models Unspecified 13 Sales 40K Phase 1 4 Phase 2 35 Lawnmower Engine power 26 to 66kW 2c 22 19 makes Engine displ 100-270ml 4c 151 183 models Price $449-$3609 Unspecified 10 Sales 424K Phase 1 95 Phase 2 48 Line trimmer Engine power 07 to 45kW 2c 25 8 makes Engine displ 24-195ml 4c 2 29 models Price $136-$299 Unspecified 2 Sales Phase 1 2 Phase 2 6 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

52

Type Ranges Stroke Log splitter Engine power 26 to 45kW 2c -1 makes Engine displ 100-195ml 4c 2 2 models Unspecified -Sales low Phase 1 - Phase 2 1 Multicutter Engine power 08 to 14kW 2c 17 5 makes Engine displ 23-36ml 4c 1 19 model Unspecified 1 Sales Phase 1 2 Phase 2 13 Olive nut shaker Engine power - 2c -1 make Engine displ - 4c -1 model Unspecified 1

Phase 1 - Phase 2 -Pole saw Engine power 08 to 14kW 2c 6 4 makes Engine displ 23-36ml 4c -10 models Unspecified 4 Sales low Phase 1 1 Phase 2 3 Power carrier Engine power 37 to 231kW 2c -2 makes Engine displ 160 to 953ml 4c 11 11 models Unspecified -Sales low Phase 1 - Phase 2 10 Power cutter Engine power 32 to 45kW 2c 5 2 makes Engine displ 64-99ml 4c -8 models Unspecified 3 Sales low Phase 1 1 Phase 2 3 Pruner (3 models in 2003) 2c -0 make 4c -0 models Unspecified -Sales low Ride-on-mower Engine power 26 to 231kW 2c -12 makes Engine displ 100 to 725ml 4c 93 124 models Unspecified81 Sales 51K Ph1 1 Ph2106 Rotary hoe (4 models in 2003) 2c -0 makes 4c -0 models Unspecified -Sales low Shredder Engine power 3 to 96kW 2c 1 6 makes Engine displ 126-389ml 4c 16 20 models Unspecified 3 Sales 46K Phase 1 - Phase 2 4 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

53

Type Ranges Stroke Stump grinder Engine power 96kW 2c -1 make Engine displ 389ml 4c 1 1 model Unspecified -Sales low Phase 1 - Phase 2 1 Tiller Engine power 08 to 59kW 2c -3 makes Engine displ 25-243ml 4c 8 9 models Unspecified 1 Sales low Phase 1 - Phase 2 7 Trencher Engine power37kW 2c -1 makes Engine displ 183ml 4c -1 models Unspecified 1 Sales low Phase 1 - Phase 2 1 Trimmer Engine power - 2c 10 2 makes Engine displ - 4c -21 models Price - Unspecified 11 Sales Phase 1 4 Phase 2 -Turfcutter Engine power 37kW 2c -1 makes Engine displ - 4c 1 1 models Unspecified -Sales low Phase 1 - Phase 2 -Vac Engine power 22 to 172kW 2c 1 5 makes Engine displ 158 to 674ml 4c 13 15 models Unspecified 1 Sales Ph11 Ph24 Vac chipper Engine power 34 to 45kW 2c -2 makes Engine displ 158-195ml 4c 3 3 models Unspecified -Sales low Phase 1 - Phase 2 1 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

54

Appendix 2 Examples of Current Australian Benchmarking Programs

The following describes in varying degrees of detail a number of current Australian benchmarking schemes classified by program type simple bench mark approaches tiered benchmarks and government industry partnerships This appendix concludes with a summary table of these programs with an assessment of their effectiveness

1 Introduction

Simple benchmark schemes (described below) such as the woodheater standards set a single point hurdle rate whereas the green vehicle guide use tiered benchmarks The new water efficiency labelling scheme and minimum energy efficiency performance standards uses both a simple benchmark through minimum performance requirement plus tiered benchmarks incorporated into labels as lsquostarsrsquo Other approaches such as the stand-by power program and the Victorian Altona Complex VOC reduction target set goals for achievement within a specified time period Other approaches taken to reduce environmental impacts include the National Packaging Covenant which uses a program based on individual companies developing tailored approaches to suit their circumstances and is supported by enforcement capability through the National Environment Protection (Used Packaging Materials) Measure (the NEPM)

2 Simple Benchmarks

21 Minimum Energy Performance Standards (MEPS)

Purpose

MEPS prescribe a minimum allowed energy performance for specific appliances Appliances that are less efficient than the relevant standard are excluded from the market

Background and Strategy

In October 1999 as part of the National Greenhouse Strategy (1998) nationally consistent MEPS and labelling schemes were adopted across Australia

Independent NATA accredited laboratories undertake product compliance checks to see whether products perform in compliance with MEPS requirements For example

bull In 2003 the government conducted check tests on eight appliance models all of which were found not to meet the claims made on the energy performance labels Two products were deregistered one was found to have not been registered and action was pending on the remaining five products (AGO 2003b)

55

bull Other regulatory actions undertaken in 2003 included fines of $3000 and $8000 against two Western Australian retailers who were found to have sold appliances without energy performance labels Queensland and Victorian retailers received infringement notices and fines totalling $10 000 (AGO 2003b)

Summary RegulNated minimum performance standards based on an Australian Standard

22 Energy Star

Purpose

An endorsement label that indicates an electronic product has achieved a specified standard when it is not performing its core function (ie on stand by)

Background and Strategy

Energy Star is a voluntary endorsement labelling program developed by the US Environmental Protection Agency (US EPA) It has been operating in the USA since 1992 and has been adopted by a number of countries including Australia Energy Star sets voluntary standards for reducing the electricity consumption of electronic equipment when it is not performing its core function

The Government stand ndash by program which is outlined below complements the energy star labelling program

Summary Voluntary endorsement label

23 Woodheater Standards

Purpose

To reduce particle emissions through Australian Standard compliant woodheaters

Background and Strategy

Since 1992 Australian StandardNew Zealand Standards have been introduced to improve the performance of wood heaters

The first standard for wood heater emissions AS4013 (1992) was published in 1992 and was revised and published as a joint AustralianNew Zealand Standard in 1999 ASNZS4013 (1999) Domestic solid fuel burning appliances - Method for determination of flue gas emission This Standard provides a test method to measure particles emitted by residential solid-fuel burning heating appliances

56

The 1992 Standard included an upper limit for acceptable particle emissions of 55 grams of particles per kilogram (oven-dry weight) of fuel burnt This emission factor was reduced to 4 gkg in the 1999 revision of the Standard The Standard applies to solid-fuel burning space-heating appliances (including those fitted with water heating devices) with a heat output of 25KW or less It does not apply to masonry fireplaces cooking stoves central heating appliances or water-heating-only appliances

AS 4013 (1999) is complemented by ASNZS4014 (1999) Domestic solid fuel burning appliances - Test Fuels and ASNZS4012 (1999) Domestic solid fuel burning appliances - Method for determination of power output and efficiency

The woodheater industry was instrumental in initiating the development of standards and it lobbied states and territories to enact legislation to mandating that woodheaters be required to meet the standards As the health affects of particle pollution have become more apparent and as some jurisdictions are having difficulty in meeting national particle standards Government has become more proactive in controlling woodheaters and more supportive of tighter standards

All states and territories with the exception of South Australia have regulations that restrict emissions from new woodheaters although Victoria for example only introduced its regulations in 2004 compared to Tasmania who introduced regulations in 1993 These regulations require that new woodheaters comply with the Australian Standard ASNZS 4013 The State regulations however are not uniform

Many woodheaters that are currently certified for sale do not comply with the revised standard as verified in a National Woodheater Audit Program undertaken in 2004 Seven of the 12 wood heaters tested failed to meet the ASNZS 4013 particle emission limit In addition 55 of heaters were found to have deviations from the original designs and 72 had labelling faults that could adversely affect emissions performance

Testing and certification are administered by the industry association

Summary State and regulations requiring compliance with Australian Standards Certification administered by industry association

24 Standby Power

Purpose

To reduce lsquoexcessiversquo energy consumed in electrical appliance standby mode sold in Australia through in the first instance voluntary targets Appliances covered by the program range from information technology equipment such as PCs and photocopiers entertainment equipment such as TVs DVDs and sound systems major appliances such as water heaters dishwashers and refrigerators and small appliances such as smoke detectors and bread makers

57

Background and Strategy

In 2000 standby power was estimated to constitute 116 per cent of Australiarsquos residential energy use costing households over $500 million and leading to the emission of over 5 million tonnes of carbon dioxide equivalent (AGO 2002c) Holt and Harrington (2004) estimated that standby power consumption in Australia could be reduced by 56 per cent by 2020 (Productivity Commission 2005)

In August 2000 all Australian jurisdictions agreed to pursue efficiencies in standby power consumption of energy-consuming products through support for the International Energy Agencys One -Watt program and endorse its incorporation into theprogram of work

Australia reportedly has taken the lead on implementing the One- Watt program even though many of the products sold in Australia are imported

During 2002 government agencies consulted with stakeholders about ideas to reduce standby The standby strategy which proposed a list of targeted potential product types was presented to the Ministerial Council on Energy

In September 2003 an interim test method for the measurement of standby power ASNZS 62301-2003 (int) based on an internationally recognised standard was published Also during this period work commenced on developing draft product profiles for high priority targeted products

Once product profiles are completed interim voluntary date-specific targets are made The product sales are then monitored to determine progress towards the interim target If it is then determined that inadequate progress is being achieved by a significant number of suppliers then government will regulate

For example the interim 2007 target for clothes washers is as follows

Product Off mode power End of program mode

lt 1W lt 4 W

The National Standby Strategy Target to be achieved by 2012 for clothes washers is as follows

Off mode power End of program mode lt 03 W lt 1 W

In support of the clothes washer program Government will

bull consider creating a Government Purchasing Policy to buy low standby clothes washers where available and fit for purpose

bull collect data on all modes for new clothes washers and analyse trends

bull highlight the range of performances by publishing performance data on clothes washers on a website or by other means

58

bull progressively include standby energy consumption into the Comparative Energy Consumption for labelled products such as clothes washers and clothes dryers

bull work with the Standards Committees to finalise the details of modes and test methods for the relevant standards

bull determine in 2008 if progress is inadequate and if regulation is required

Summary Industry targets possible future regulation

3 Tiered Benchmarks

31 Mandatory Energy Efficiency Label ndash the Energy Star Programs

Purpose

To enable consumers to easily compare the energy performance of electrical appliances used by households and firms through a labelling scheme

Background and Strategy

Several Australian states commenced mandatory energy efficiency labelling for major appliances in the mid-1980s In 1992 it became mandatory across Australia for initially refrigerators and later freezers clothes washers clothes dryers dishwashers and air-conditioners (single phase only) to carry the label when they are offered for sale This labelling program is regarded as one of the most successful in the world (Wilkenfeld and Assoc 2003) It is administered through the Australian Greenhouse Office

The energy rating label for dishwashers

(ldquoa joint government and industry programrdquo) and a website address (wwwenergyratinggovau) and has two main features

bull the star rating which gives a quick comparative assessment of the models energy efficiency and

bull the comparative energy consumption (usually kilowatt hoursyear) which provides an estimate of the annual energy consumption of the appliance based on the tested energy consumption and information about the typical use of the appliance in the home These values are measured under Australian Standards which define test procedures for measuring energy consumption and minimum energy performance criteria Appliances must meet these criteria before they can be granted an Energy Rating Label

The Energy Rating Label includes an endorsement

59

Awards Brand ModelInstallat

ionType

Phase Available

10 Yr Energy

Cost StarRating

Output(kW)

TOSHIBA

Digital Inverter Series Air

Conditioner RAV-SM1102BT-

ERAV-SP1102AT-E (

RAV-SM1102BT-ERAV-

SP1102AT-E)

SingleSplit

SystemDucted

Single $1500 1000

CHUNLAN

KFR-32GWVWa (

NO)

SingleSplit

SystemDucted

Single $645 323

Since its introduction the star rating label seems to have established a high level of recognition with consumers Consumer research (Artcraft 2003) indicates that the different information on the label appeals to different consumer segments interested in purchasing an appliance

When a manufacturer gains approval to use the label they pay for and produce the label in accordance with specifications on size colours fonts layout and design A similar colour scheme and design to the energy consumption label is also used for the compulsory fuel consumption label on new passenger and light commercial vehicles

The labelling scheme is underpinned by regulation whereby regulated Minimum Energy Performance Standards (MEPS) provide the environmental benchmarks that the appliances are required to meet Appliances that do not meet the minimum energy performance standards can be withdrawn from the Australian market

When the energy rating program was reviewed in 2000 technology had advanced to the point where a large percentage of appliances had achieved the maximum number of stars so the rating system was tightened It is estimated that over the 25 year period 1980 to 2005 there will have been an overall reduction in energy consumption of around 70 by the most popular sized refrigerators (with freezers) (Harrington L and Holt S 2002)

In addition to the energy consumption label there is a website (wwwenergyratinggovau) with a comprehensive database of all appliances their star rating and energy consumption In 2002 there were around 220000 hits on the programrsquos various websites and 523000 in 2003 reportedly representing 80000 visits by individual inquirers The website hit rate is estimated to represent almost 10 of consumers who are considering purchasing an appliance (Holt et al 2003)

Cooling

Energy Input (kW)

250

104

Figure B Excerpt from Energy Rating web page for Air Conditioners (cooling cycle only shown)

When the energy rating program was reviewed in 2000 technology had advanced to the point where the Scheme had to be tightened because a large percentage of appliances had achieved the maximum number of stars For example energy use by refrigerators was around 70 compared to that used when the scheme started (Harrington L and Holt S 2002)

60

Regulations

State and Territory legislation refer to the relevant Australian Standards This approach simplifies the State and Territory legislation and makes it relatively straightforward to maintain national consistency of appliance and equipment energy efficiency standards even when standards are continually being revised

The testing procedures and technical requirements for the label and also Minimum Energy Performance Standards (MEPS see below) are incorporated into the applicable Australian Standards Products for sale must be registered with one of the State regulators

Program Administration

The labelling program and MEPS program are administered by the National Appliance and Equipment Energy Efficiency Committee (NAEEEC) which is ultimately directed by the Ministerial Council on Energy

Requirements for Appliance Suppliers

Appliance suppliers are required to

bull Submit applications for product registration and these must include a test report or other data to demonstrate that the appliance meets the relevant Australian Standard

bull While test reports on three separate units are required for most products there is no particular requirement for test laboratories to be accredited or products certified for registration for energy labelling and MEPS in Australia Test reports from the manufacturers laboratory are satisfactory However if there is evidence that results from a particular laboratory are unsatisfactory regulators can mandate test reports from an accredited laboratory

Summary Mandatory labelling scheme backed by regulations and an Australian Standard

32 Water Appliances Water Efficiency Labelling and Standards (WELS) Scheme

Purpose

A labelling scheme backed by legislation to promote domestic water efficient appliances

Background and Strategy

A voluntary water efficiency industry administered labelling scheme has been in existence since 1988 The water efficiency ratings and details on the label design are covered in ASNZS 6400 The main incentive of the voluntary lsquoAAAAArsquo scheme

61

has been the publicity and cash rebates offered by water utilities However the coverage water efficiency performance requirements and impact of this program have been limited

In 2003 the Environment and Heritage Ministers agreed to implement a national Water Efficiency Labelling Scheme (WELS) for products such as shower heads washing machines dishwashers and toilets Consultation with industry and stakeholders was undertaken in 2003 with a strategic study published that identified the products to be included in the new labelling Scheme A Regulation Impact Statement (RIS) which identified the costs and benefits of various options and made various recommendations was published in March 2004 Following public review of the RIS some modifications were made to WELS

The WELS Scheme is backed by the following legislation and standard

Water Efficiency Labelling and Standards Act 2005 which establishes

bull the products subject to the Scheme and the requirements for registration and labelling

bull the standards to apply to WELS products setting requirements for water efficiency performance registration and labelling of these products

bull enforcement provisions including penalties bull the appointment of inspectors to investigate possible contraventions and sets

out their powers and obligations bull review and dispute resolution bull a program Regulator bull the making of regulations bull a requirement for annual reports and for an independent review after five years

Water Efficiency Labelling and Standards Regulations 2005 which

bull prescribes the circumstances in which a person other than the manufacturer of a WELS product may be taken to be the manufacturer of the product (eg an importer)

bull sets out procedures for the issuing and the payment of penalty infringement notices as an alternative to prosecution for offences against the WELS Act

bull specifying the information to be included on an identity card issued to a WELS inspector

Water Efficiency Labelling and Standards Determination 2005 amongst other things determines and establishes product registration fees and calls up the Australian Standard ASNZS6400 2005 Water-efficient products - Rating and labelling which

bull defines the products

bull specifies the assessment procedures (ie identifies test procedures in other Australian Standards)

bull provides the formulas to give products their star rating

bull specifies the labels and their application to products

62

Approximately twenty organisations were represented on the Standards Committee that developed the Standard

State and Territory legislation

The States and Territories have also enacted or agreed to enact complementary legislation to ensure that the WELS Scheme has comprehensive national coverage State and Territory legislation which is almost a mirror of the Commonwealthrsquos Water Efficiency Labelling and Standards Act 2005 enables the States and Territories to for example undertake certain responsibilities delegated to them by the Commonwealth Regulator appoint their own inspectors and enforce the WELS

Other features of WELS include

bull A product web database

bull With the exception of toilets no other products are required to meet mandatory water efficiency requirements (WES) but this may change over time The introduction of mandatory WES means that products not meeting the minimum performance requirements can not legally be sold

bull Products must be tested in accordance with the relevant Standard and must meet any minimum performance and water efficiency requirements in the Standard before they can be granted a WELS Water Rating label

bull It is up to manufacturers or their agents (eg importers in the case of imported products) to ensure that their products are correctly registered and labelled and comply with any other requirements of the Standard

There is a transition phase which gives manufacturers and importers time to test register and label products and to sell pre-existing stock From 1 January 2008 all products are required to display the WELS Water Rating labels irrespective of their date of supply

63

The WELS Water Rating label

Label Features

bull A star rating for a quick comparative assessment of the models water efficiency

bull Labels with 1 to 6 stars

bull Some products may also be labelled with a Zero Star Rated label which indicates that the product is either not water efficient or does not meet basic performance requirements

bull A productrsquos water consumption figure

bull There are provisions for swing tags if there is inadequate surface area for label or the item is likely to be marked by sticking the label on the product

Summary Mandated product labelling using lsquostarrsquo rating system Has a disendorsement label and has provisions to ban products

33 Gas Appliance Rating Scheme

Purpose

A gas labelling program to improve the energy efficiency of gas powered products

Background and Strategy

The Gas and Fuel Corporation of Victoria introduced energy labelling for gas water heaters in 1981 This scheme was taken over by the AGA in 1985 who in 1988 introduced a six star energy performance label This label was intended to be visually consistent with the star rating labels already familiar to consumers of electrical appliances

The labelling scheme is currently voluntary and still administered by the industry body

A range of gas appliances have been subject to minimum energy performance standards (MEPS) since the 1960s The current MEPS levels were set in 1983 and

64

Brand Model Type MjyearStar

RatingSRI

StorageCapacity

(ltrs)IndoorOutdoor

NaturalGas

Instantaneous 18969 59 I N

Instantaneous 18969 59 I N

lsquothe majority of models currently on the market appear to exceed current requirements by a comfortable marginrsquo (SEAV 2003 p 23)

The gas energy labels are similar in format to those found on electrical appliances except they are blue and show annual energy use in MJ

A trial web site listing gas water heaters available in Australia is also available (see below)

Bottle Gas

Rinnai Infinity

V Series

REU-V2632FFU-A (Infinity 26 plus internal) P

Rinnai Infinity

V Series

REU-V2632FFUC-A (HD2001 internal) P

A joint review of the scheme is under way by the Gas Industry and Governments and regulation is under consideration A three year work plan has been published under the Australian and New Zealand Appliance and Equipment Energy Efficiency Program

Summary Currently voluntary labelling using lsquostarrsquo rating system with mandatory minimum energy performance standards Future regulation is under consideration

34 Green Vehicle Guide

Purpose

To provide web-based comparable and accessible environmental data on new motor vehicles

Background and strategy

65

The Commonwealth government started publishing a booklet of fuel consumption data for new passenger and light commercial vehicles in the early 1980s and a low cost web database in more recent years

In 2004 the Government through the Department of Transport and Regional Services (DOTARS) expanded the fuel consumption guide into the Green Vehicle Guide The Green Vehicle Guide is a web based database that rates new passenger and light commercial vehicles on air pollution greenhouse emissions and fuel consumption and gives an overall lsquostarrsquo rating for each vehicle within each vehicle category (small medium luxury sports etc)

The data on which the scores are derived are provided voluntarily by the vehicle manufacturers however this data is based on mandatory Australian Design Rule certification test data

The Guide uses a 5 star rating system however it also assigns half stars resulting in a total of 10 levels

The Greenhouse Ratings are based on carbon dioxide emissions and the Air Pollution Ratings take into account the relative environmental impact of oxides of nitrogen hydrocarbons and particles The relative harmfulness of the pollutants (shown in table below) has been quantified based on the allowable concentrations under the Ambient Air Quality National Environment Protection Measure (NEPM)

Green Vehicle Guide Weighting of Regulated Vehicle Emissions

Vehicle Emission

(equivalent pollutant under Air NEPM)

Calculated

Relative

Harmfulness

Final

Weighting

Carbon Monoxide (CO) 0088 Not included

Oxides of Nitrogen (NOx) (based on

Nitrogen Dioxide)

4 1

Hydrocarbons (HC) (based on

photochemical oxidants as ozone)

5 1

Particulate Matter (PM) (based on PM10) 20 5

Source Real and Jones 2005

NOx and HC were given equal final weightings despite the slight difference in the calculated relative harmfulness primarily because under ADR7900 a combined HC+NOx limit is prescribed rather than individual limits for each pollutant

The higher weighting for particulate matter recognises its significant health impacts The Air Pollution rating scale was devised in such a way that a lsquotypicalrsquo car (that is most petrol engined passenger cars meeting the current emission standard at the time) receives a mid-point rating (5 out of 10)

66

The overall rating or stars is derived from the sum of the air pollution and greenhouse scores ie they are equally weighted

Development of the Green Vehicle Guide (see extract below) involved extensive consultation with vehicle manufacturers

Website Costs

The new highly automated web database which contains data on approximately 1400 vehicles and has sophisticated search facilities cost approximately $200000 to develop plus around $100000 was spent recently to improve the sitersquos usability This compares to the previous low cost database which together with the printed guide cost less than about $80000 per annum The low cost version lacked the automation was only updated annually and did not have the ability to compared vehicles

The manufacturers provide the data on line using special access codes This data is checked by DOTARS before it is uploaded onto the website It takes close to a full time position within DOTARS to administer the website and respond to website related queries

Market Research and Marketing

Before the new greenvehicleguidegovau website was launched DOTARS commissioned consumer surveys to determine the level of knowledge about the environmental impacts made by vehicles This research showed that around half of those surveyed had the belief that ldquoall new cars have the same level of impact on the environmentrdquo

It became apparent through the surveys that there was a need to provide consumers with meaningful information on the relative performance of different vehicles This was a view shared by the Productivity Commission who said that while markets provide extensive information to consumers regarding fuel consumption of motor vehicles ldquothe Australian Governmentrsquos Fuel Consumption Labelling Scheme and Green Vehicle Guide provide relatively low cost accessible and comparable information to consumers and may be justified as part of the more fundamental objective of encouraging consumers to reduce the adverse environmental impacts of motor vehicle userdquo The Productivity Commission also commented that government

67

sources of information of this type were seen as credible and reliable and held in higher regard than information provided by others

DOTARS has scheduled some follow up consumer research for 200062007

DOTARS has spent about $600000 in marketing the Green Vehicle Guide This has included advertising in weekend guides in newspapers developing facts sheets plus targeted marketing to motor vehicle journalists

Summary Website - voluntary but legislative base

4 Government-Industry Partnership programs

Government-Industry Partnerships are the basis of many environmental initiatives and can take a number of forms Industry and government negotiate the terms of the program which are normally detailed in a formal agreement which sets out the environmental objectives and the responsibilities of each party towards their achievement

The GovernmentIndustry Partnership programs outlined below indicate the varied nature of these initiatives

41 The National Packaging Covenant

The National Packaging Covenant (the Covenant) commenced in 1999 and is a voluntary agreement between all levels of government and companies throughout the packaging chain including raw material suppliers packaging producers and retailers The Covenant commits signatories to the implementation of best practice environmental management in areas such as packaging design production and distribution and research into life cycle issues Signatories to the Covenant produce action plans on the measures they will implement to reduce packaging waste and they report annually on their progress In this sense the Covenant provides flexibility to signatories to develop plans suitable to their own circumstances The Covenantrsquos success (it currently has over 600 signatories) is due to the active promotion of it by Government and key industry players

The Covenant is complemented by a regulation the National Environment Protection (Used Packaging Materials) Measure (the NEPM) which enables states and territories to use enforcement action to require companies that donrsquot sign the agreement to take steps to reduce their packaging waste Preceding the Covenant and the NEPM were a number of voluntary industry agreements but these were limited in scope and largely focused on companies in the beverage industry

42 National Industry Reduction Agreement

The Publishers National Environment Bureau (PNEB) was formed in 1990 as an association of the major publishers of newspapers and magazines in Australia to promote the recovery and recycling of old newspapers and old magazines primarily from community kerbside collections organised by local councils

68

The PNEB and a newsprint manufacturer have voluntarily entered into a series of five-year Industry Waste Reduction Agreements with the Commonwealth and State Governments Under the current (third) plan 2001-2005 newsprint recycling in Australia has grown to 754 nationally in 2005 from the 28 level when the PNEB was formed in 1990

43 StateLocal target based programs

There have been a number of agreements signed by state government departments and an industry group where there is a stated goal to reach a specific environmental target For example in the early 1990s there was a voluntary agreement with the EPA Victoria and companies in the Altona Chemical Complex in the western suburbs of Melbourne (which includes Australian Vinyls BASF Dow Chemicals and Qenos) to reduce hydrocarbon emissions by 50 within a specified timeframe The target was met and further emissions reductions were negotiated The NSW EPA-Oil industry petrol volatility agreement outlined below is another example of a target based program

44 NSW EPA-Oil Industry Memorandum of Understanding on Summer Petrol Volatility

In 1998 NSW established arrangements for the supply of low volatility petrol in summer in the Sydney Greater Metropolitan Region implemented through a Memorandum of Understanding between the then EPA and oil companies The principal reason for controlling petrol volatility in summer is to reduce evaporative emissions of VOCs (from vehicles and production and storage sites) which contribute to ozone formation

The Memorandum of Understanding operated over four summer periods from 1998 to 2002 and involved companies voluntarily reducing petrol volatility (measured in kilopascals (kPa) of vapour pressure) over three summer periods from a base of 76kPa to 70kPa in the first summer 67kPa in the second and 62 kPa in the last two years

Although the Memorandum of Understanding was successful in progressively reducing petrol volatility over the period of its operation it was not supported by all industry members Consequently agreement was reached with industry that summer petrol volatility limits should be regulated to ensure a level playing field for all industry participants and regulated limits will apply from the summer of 200405

69

5 Summary of Australian Benchmark Programs

Program National State

Summary of Approach Impact

Voluntary Programs Altona Chemical Complex (Vic)

Local Small industry group worked towards self determined targets

Very high

Energy Star National Standards based label Limited Gas appliance Rating Scheme

National Industry operated labelling scheme with stars assigned therefore has graded benchmarksminimum performance standards out dated web database being developed

Low

National Industry Reduction Agreement

National Small industry group worked towards negotiated targets

High

NSW EPA-Oil Industry MOU

State Small industry group worked towards negotiated targets but not all involved ndash lead to regulations

Moderate

Top Energy Saver Award

National Achievement based label Limited

Quasi Regulatory Green Vehicle Guide

National Well promoted web database star ratings assigned therefore has graded benchmarks data provided voluntarily but backed by ADR requirements

High

Stand-by power National Required to achieve voluntary targets or regulation will be introduced

Unknown

National Packaging Covent

National Performance based targets backed by legislation High

Regulatory Energy Efficiency Labels

National Labelling scheme with stars assigned therefore has graded benchmarksbased on Australian Standard web database

High

MEPS National Sets base benchmark and works with energy rating

High

WELS Scheme National Labelling scheme with stars assigned therefore has graded benchmarksbased on Australian Standardweb database

High

Wood heaters State Only one benchmark assigned regulations are not uniform

Moderate

authorrsquos assessment based on direct or indirect knowledge of these programs

70

Appendix 3 Productivity Commission Comments on Labelling and Minimum Performance Standards

The Productivity Commission an independent agency which is the Australian Governmentrsquos principal review and advisory body on microeconomic policy and regulation recently examined the cost effectiveness of improving energy efficiency As part of its review lsquoThe Private Cost Effectiveness of Improving Energy Efficiencyrsquo it examined labelling programs minimum mandatory energy efficiency requirements and other means of providing consumer information The final report contains some highly relevant material that is applicable to establishing a benchmarking scheme for small engines

The following is a summary of relevant conclusions from the Inquiry

Government Operated Labelling Schemes

From consumer research provided to the Commission it concluded that ldquothere is some evidence to suggest that consumers are now paying more attention to labels than they have in the pastrdquo

The Commission was positive about labelling programs as labels

bull directly address ldquoa source of market failure mdash the asymmetry of information between buyers and sellers of energy-using productsrdquo

bull provide information to the consumer that is readily-accessible and easily-understood and therefore can assist in helping the consumer make better-informed choices

bull are likely to have produced net benefits for consumers

bull do not directly limit consumer choice

bull could provide a greater incentive for suppliers to sell products that use energy cost effectively

bull probably produced net social benefits

bull are most suited where there is a wide spread in the range of performances of comparable appliances and where information failures are most pronouncedrdquo

bull can be used to warn consumers that an appliance is very inefficient (through a disendorsement label) which could be effective in discouraging but not preventing consumers from buying the poor performing product

The Commission was supportive of Governmentrsquos role of drawing together and packaging information through labelling programs as this ensures that ldquorelevant and trusted information gets to those who would otherwise not get itrdquo In material reviewed by the Commission George Wilkenfeld and Associates and Energy Efficient Strategies (1999) claimed that labelling is unlikely to be effective if purchasers rarely inspect appliances in a showroom where they can compare performance across

71

different models or the purchaser is not the ultimate user and so has little interest in operating costs

Labelling programs involves both administration and compliance costs such as those incurred by suppliers in having their products tested but the Commission considered that labels should be more actively considered as an alternative to minimum performance standards

Minimum Performance Standards

Governments can prevent the sale of inefficient products by using minimum standards for example the Minimum Energy Performance Standards (MEPS) that apply to appliances such as refrigerators and freezers air conditioners and electric water heaters If appliances do not meet the minimum standard they cannot be sold in Australia Some appliances are covered by both MEPS and by labelling (for example refrigerators)

The Commission considered that MEPS and labels can be complementary as MEPS act to penalise the worst energy performers whereas labels rewarding the better performers

Costs comparisons of schemes

The Department of the Environment and Water Resources provided details about the costs involved in administering both the labelling scheme and the minimum performance standards for energy programs It stated that

bull the administration costs of MEPS are substantially lower than for labelling but the compliance costs can be higher

bull MEPS can have a greater cost for suppliers than labelling since suppliers must adjust their model ranges to meet the MEPS levels by the given date These compliance costs are however influenced by the lsquolead inrsquo time between the introduction of the regulatory proposal and the implementation of the MEPS

bull it is estimated that the administration costs for MEPS would be $3 million over the period 2000ndash15 compared to $39 million for labelling (in present value terms) (George Wilkenfeld and Associates and Energy Efficient Strategies 1999) Furthermore it was assumed that 84 per cent of administration costs were borne by appliance purchasers with the remainder borne by governments

It estimated that MEPS would increase the cost of appliances by $266 million over 2000ndash15 compared to $688 million for labelling (the latter cost being due to consumers voluntarily purchasing more efficient appliances)

72

Page 6: Outdoor Garden Equipment - Department of the Environment

Abbreviations and Glossary 2c Two stroke with carburettor 2di Two stroke with direct fuel injection 2i Two stroke with pre-chamber fuel injection 4c Four stroke with carburettor 4i Four stroke with fuel injection (includes direct injection) ABS Australian Bureau of Statistics ABT Averaging Banking and Trading of emissions ADR Australian Design Rule Air NEPM National Environment Protection Measure for ambient air quality BTEX Benzene toluene ethylbenzene xylenes - carcinogenic or mutagenic aromatic

hydrocarbons formed through the combustion process CARB Californian Air Resources Board CBA Cost Benefit Analysis cc Cubic centimetres CO Carbon Monoxide DEC Department of Environment and Conservation di Direct Injection efi Electronic fuel injection EU European Union Euromot The European Association of Internal Combustion Manufacturers gkW- hr Grams per kilowatt hour HCs Hydrocarbons ndashmost are VOCS and in relation to small engines the terms are

often used interchangeably hp Horsepower 1 hp =7457 watts ISO International Standards Organization kW Kilowatts MEPS Minimum Energy Performance Standards MOU Memorandum of Understanding NATA National Association of Testing Authorities NOx Oxides of Nitrogen NPI National Pollutant Inventory NSW GMR New South Wales Greater Metropolitan Region which includes Sydney Lower

Hunter and Illawarra regions encompassing the major metropolitan centres of Sydney Newcastle and Wollongong Population approximately 47 million

OPEA Outdoor Power Equipment Association PM10 Particles with an aerodynamic diameter of 25 micrometres or less PM25 Particles with an aerodynamic diameter of 10 micrometres or less Port Phillip Region in Victoria of 24000 km2 that includes Greater Melbourne and Greater Region Geelong It is defined in Victorian environmental policy Population

approximately 34 million (1996) SE Qld South East Queensland - a region that covers the area from the Gold Coast to the

Sunshine Coast and west to Toowoomba It includes Brisbane amp suburbs population approximately 23 million people

USEPA United State of America Environmental Protection Agency VOCs Volatile Organic Compounds WELS Water Appliances Water Efficiency Labelling and Standards Scheme

ii

Executive Summary

Background

This report sets out the results of a project to compare and benchmark emissions from small petrol engines (less than 19 kilowatts) that are used to power outdoor garden equipment and were available for sale in Australia during 2006 The equipment powered by these small engines are used in lawnmowers brushcutters hedge trimmers and the like

These engines emit volatile organic compounds (VOCs) and oxides of nitrogen (NOx) which contribute to ozone (photochemical smog) formation in summer They also emit particles carbon monoxide (CO) and a range of air toxics such as benzene

Sydneyrsquos Greater Metropolitan Region (GMR) annually records exceedances of the National Environment Protection (Ambient Air Quality) Measure (Air NEPM) ozone standards The other jurisdictions meet or are close to meeting the current ozone standards

The Air NEPM standards are being reviewed and based on current human health evidence the argument appears to be strengthening for tighter ozone standards Should a stricter standard or an eight-hour standard consistent with international standardsguidelines be adopted achievability of Air NEPM ozone standards or goals could become an issue for some of the other major urban airsheds

The United States California Canada and Europe regulate emissions from outdoor equipment - the USA has had these in place since 1997 There are no Australian regulations or standards that limit air pollutant emissions from engines used in outdoor garden equipment however as the majority of equipment sold in Australia is imported some do comply with emission standards applicable to the country of origin

Small engines are not as advanced in environmental terms as motor vehicle engines As a result even the better-performing small engines emit far greater quantities of pollutants per hour than typical modern car engines For example the US Environmental Protection Agency (USEPA) 2002 limit for a typical 4 kilowatt (kW) lawnmower motor is about 66 grams (g) of regulated pollutants per hour of operation A typical 08kW brushcutter sold new in 2002 emitted about 160grams of pollutants per hour - reducing to 40grams per hour if bought new in 2006 The equivalent limit for cars under Australian Design Rule 79 is about 16g per hour In other words one hour of operation of a brushcutter that meets USEPA 2002 limits produces the same pollution as ten cars operated over a similar time These comparisons are subject to differences in test methods but they do provide an indication of the disproportionate amount of pollution emitted by small engines

Engines that do not comply with current USEPA requirements are likely to emit several times the amount of pollution calculated in the above example Therefore the worst performing engines are likely to emit more than ten times the emissions of the best performers

iii

Based on estimates made using the National Pollutant Inventory database engines used in lawn mowers contribute approximately 4 on average to VOC emissions from anthropogenic sources in major airsheds in Australia when public open space lawn mowing is included This is likely to rise to around 11 in the warmer spring and autumn weekends which is when lawns and other vegetation grows faster and when gardening is more popular The NPI does not take into account emissions from other types of powered outdoor equipment

The Australian Market

According to the Outdoor Power Equipment Association (OPEA) approximately 424000 walk behind lawnmowers and more than 792000 units of outdoor handheld equipment were sold in Australia in 2005-06 In addition there were sales of about 80000 replacement engines and 70000 pumps in 2005-06 most of which were four strokes The general household consumer represents the major market segment for garden equipment accounting for up to 90 of product sales with commercial garden services and government purchasing the rest

Indications are that sales of imported high polluting two stroke engines have increased over the last few years and it appears that the price of some powered garden equipment has dropped to the level where consumers regard them as disposables

An assessment of outdoor equipment on the Australian market found that the majority of small engines sold in Australia are imported and many come from countries that impose emission limits The extent of imports into Australia that do not comply with the country of origin standards is not known However the industry estimate that 40 of garden products are sold through importers who are not linked to manufacturers of US EPA or European certified equipment and the source of some products sold here is difficult to establish Victa is the only company producing small engines in Australia Its iconic 2-stroke lawn mower engine currently does not meet overseas emission limits for non-handheld equipment and Victa is undertaking research and development to reduce emissions from its two stroke engine to meet US and European standards

In spite of several attempts to obtain data on compliance with overseas emission standards from Australian distributors their response was poor The following figure therefore provides a best estimate of expected compliance of outdoor equipment on the Australian market with European CARB or USEPA requirements applicable in 2004

iv

Figure E1 Compliance with overseas standards for popular categories ldquoPhase 1 equivrdquo means the engine complies with US EPA phase 1 or 200288EU ldquoPhase 2 equivrdquo means the engine complies with US EPA Phase 2 Euro I or Euro 2 ldquoUnknown means that engine cycle (stroke) was not provided

Measures to Increase Sales of Low Emission Garden Equipment Engines

There is a range of options that could be considered for reducing emissions from engines used in outdoor garden equipment engines in Australia These include

1 Maintaining the Status Quo

2 Government ndash Industry Partnership Program

3 Quasi regulation

4 Co-regulation

5 Regulations based on either a simple benchmark or tiered benchmarks

The Small Engine Expert Panel ndashOutdoor Equipment has considered in depth the most appropriate approach to take to improve the emissions performance of outdoor garden equipment sold in Australia It recommends the introduction of national regulations to control the emissions from outdoor garden equipment particularly in light of the increase in cheap imports onto the Australian market which although untested are considered very likely to have high emission levels The Expert Panel has developed some broad recommendation on which Australian regulations could be based which takes in consideration the local market and Victa These are summarised as follows

1 Mandatory air pollutant emission standards to be introduced in Australia for all outdoor equipment (lt19kW) powered by spark-ignition engines

v

The development of any regulation would need to be based on a formal assessment of the costs and benefits of nationally regulating two and four stroke lawn mowers and handheld power equipment which should commence immediately

2 Proposed standards to mirror US EPA regulations (compliance with equivalent EU regulations also acceptable)

3 Timing (subject to completion of assessment of costs and benefits)

(a) US EPA Phase 1 ndash Effective from 20072008

(b) US EPA Phase 2 ndash Fully implemented in 2012 (in step with 2007 USEPA limits) plus a phase-in period andor provisions for averaging banking and trading (ABT) of emissions over 2008-2012 to provide for early introduction of cleaner product

The US EPA Phase 1 and Phase two emissions limits are given in the table below

4 Walk-behind two stroke mowers to be included in US EPA Category 5 (gt50cc) product classifications (to provide Victa time to develop a cleaner engine) Implementation timing is proposed to be the same as Recommendation 3 above

5 All products also to be certified to relevant EPA product durability categories

6 Subject to further review ABT if included may be phased out after 2012

Table E1 Comparison between the USA Phase 1 and Phase 2 standards

Emission Limits GkW-hr

Phase 1 (1997 ndash2001) Phase 2 (2007) HC NOx HC+NOx CO HC+NOx CO

Non-handheld

I-A lt66cc 161 161 610

I-B 66-lt100cc 161 161 610

I 100-225 cm3 161 519 161 610

II 225 cm3 134 519 121 610

Handheld

III lt20 cm3 295 536 805 50 805

IV 20-50 cm3 241 536 805 50 805

V 50 cm3 161 536 603 72 603 Phase 2 limits were phased in between 2002 -2007 during which time they became tighter

For simplicity only the 2007 are shown in this table (see Table 2 for more details)

vi

Conclusion

From this review it is apparent that it is highly unlikely that the companies in the industry would engage in or commit to any voluntary type program It is therefore clear that the most expedient path to reduce emissions from these small engines is through national regulation State based regulations could only provide a piecemeal approach that would lead to product dumping in states where there are no regulations and inconsistent regulations that require industry to treat each state market differently In addition enforcement of any state based regulations would be a key problem due to existing Commonwealth and State Government mutual recognition legislation

While any national regulation of emissions from small engines used in garden equipment in Australia are likely to be based on overseas regulations they need to strike a balance between improved environmental outcome harmonisation with international standards and the characteristics of the local industry With regulations optimum emissions reduction are potentially achievable by combining minimum emissions standards with tiered product labelling Whether this approach is justifiable on economic grounds that is the benefits outweigh the costs can only be determined through a detailed impact assessment Based on these findings it is recommended that a formal assessment of the costs and benefits of nationally regulating two and four stroke lawn mowers and handheld power equipment should be commenced

vii

1 Introduction

This report sets out the results of a project to compare and benchmark emissions from engines used in outdoor garden equipment that were available for sale in Australia during 2006 Possible outcomes from the project range from consumer guidelines for selecting low emission engines to regulatory controls on emissions There are currently no state or national regulations that directly control emissions from these engines

The project was commissioned by the Commonwealth Department of the Environment and Water Resources on behalf of state and territory government departments working on reducing the impacts of small engine emissions This report was prepared in consultation with an Expert Panel that included representatives from the Outdoor Power Equipment Association (OPEA)

11 Emissions from outdoor garden equipment engines

Small engines particularly conventional two stroke engines used in applications such as outdoor garden equipment are high polluters relative to their engine size and usage1 These small engines emit volatile organic compounds (VOCs) and oxides of nitrogen (NOx) which contribute to ozone (photochemical smog) formation in summer They also emit particles carbon monoxide (CO) and a range of air toxics such as benzene The USA California Canada and Europe and regulate emissions of VOCs NOx carbon monoxide and particle emissions from outdoor garden equipment

There are five types of spark-ignition engines that can be used in outdoor garden equipment

bull two stroke with carburettor (2c)

bull two stroke with pre-chamber fuel injection (2i)

bull two stroke with direct fuel injection (2di)

bull four stroke with carburettor (4c)

bull four stroke with fuel injection (4i) (includes direct injection)

Carburettor and pre-chamber fuel injection two stroke engines are inherently more polluting than the other three types This is due to their inability to completely separate the inlet gases from the exhaust gases resulting in up to 30 of the fuel being left unburnt and the need to add oil to the fuel to lubricate the engine (four stroke engines have separate reservoirs for fuel and oil) However twostroke carburettor engines typically weigh less than a four stroke engine of the same power and this tends to make them attractive for handheld equipment They also tend to have fewer components are generally cheaper to purchase and are cheaper to maintain than

1 Outdoor equipment covered in this report are engines less than 19kW

1

four stroke motors Victa Lawncare is currently undertaking research and development to improve the environmental performance of two stroke carburettors and while some emission improvements have been made a two stroke compliant with US or European standards is still considered several years away

Four stroke carburettor engines are generally quieter more fuel efficient and are less polluting than conventional two stroke engines

Direct fuel injection (dfi) either two stroke or four stroke overcomes the unburnt fuel problem and can meet the stringent regulated exhaust emission limits that apply overseas However there is not any evidence that dfi engines are being used in outdoor garden equipment available in Australia It appears that engines used in outdoor garden equipment in Australia are generally restricted to two and four stroke carburettor engines

Small engines are not as advanced in environmental terms as motor vehicle engines As a result even the better-performing small engines emit far greater quantities of pollutants per hour than typical modern car engines For example the US Environmental Protection Agency (USEPA) 2002 limit for a typical 4 kilowatt (kW) lawnmower motor is about 66 grams (g) of regulated pollutants per hour of operation A typical 08kW brushcutter sold new in 2002 emitted about 160grams of pollutants per hour - reducing to 40grams per hour if bought new in 2006 The equivalent limit for cars under Australian Design Rule 79 is about 16g per hour In other words operated over a similar time one hour of operation of a brushcutter that meets USEPA 2002 limits produces the same pollution as ten cars and a 4kW lawnmower the same pollution as four cars These comparisons are subject to differences in test methods but they do provide an indication of the disproportionate amount of pollution emitted by small engines

Engines that do not comply with current USEPA requirements are likely to emit several times the amount of pollution calculated in the above example Therefore the worst performing engines are likely to emit some ten times the emissions of the best performers

Because of the combustion of oil these engines also emit high levels of particles Although small engines only contribute a small amount to total particle emissions the rate of particle release compared to other engines can be very high For example lawnmowers can emit over 10 times more particles (in terms of grams per hour) than a petrol motor vehicle (manufactured between 1994 and 2001)

All the above emission comparisons between outdoor garden equipment engines and motor vehicles are subject to differences in test methods but they indicate the disproportionate amount of pollution emitted by small garden equipment engines It also needs to be recognised that motor vehicles in Australia average more than 15000 kilometres per year (ABS 2003) while the annual average use of outdoor garden equipment is around 25 hours for a lawnmower and less for other types of equipment Commercial operators however are likely to have a much higher usage rates than the general public

2

This paper examines the Australian market for small engines used in lawnmowers and handheld garden equipment their impact on air quality relevant overseas regulations and their applicability to Australia and makes recommendations to reduce air quality impacts from these engines

A wide range of information sources has been referenced for this report including data and information supplied by manufacturers distributors and dealers in small engines

3

2 Air Quality and Outdoor Garden Equipment Engines

Emission inventories make estimates of emissions of substances from a multitude of sources into airsheds The National Pollutant Inventory (NPI) which is run cooperatively by the Australian state and territory governments contains data on 90 substances that are emitted to the Australian environment The substances included in the NPI have been identified as important because of their possible health and environmental effects Industry facilities estimate their own emissions annually and report to states and territories Non-industry (or diffuse) emissions estimates which includes emissions from outdoor garden equipment are made by the states and territories on a periodic basis using information sources such as surveys databases and sales figures

The NPI only reports emissions from domestic lawn mowing and for a few airsheds the contribution made by public open space lawn mowing It does not report on the contribution made by other types of outdoor garden equipment such as brushcutters National and selected state NPI emissions estimates for the common air pollutants and for Air Toxics NEPM pollutants from domestic lawn mowing are summarised in Table 1 It should be noted that national emissions from lawn mowing are underestimates as the NPI records emissions for major airsheds only and therefore is not Australia wide plus the estimates do not include evaporative emissions from fuel tanks and hoses

This NPI data is indicative only as the accuracy and completeness of the data sets varies across airsheds and is reliant on the estimation techniques used For example while the population in the NSW is higher than other airsheds its emissions look disproportionally high when compared to the other airsheds This could be because the estimation technique varies or it is due to some other factor

4

Table 1 National Pollutant Inventory Domestic Lawn Mowing Emission Estimates

Substance Port Phillip

Population 34 mill (1996)

SE Qld

Population 23 mill

NSW GMR

Population 47 mill

Adelaide

Population 10 mill

National

Common Air Pollutants (tonnesyear)

Carbon monoxide 12000 12000 24000 6100 69000

Total Volatile Organic Compounds 3600 3800 7000 2000 21000

Particulate Matter 100 um 86 94 170 9 460

Sulphur dioxide 5 5 9 50 81

Oxides of Nitrogen 63 54 120 24 330

Air Toxics (tonnesyear)

Benzene 230 210 390 130 1200

Formaldehyde 56 38 NA 31 180

Polycyclic aromatic hydrocarbons 07 11 21 04 41

Toluene (methylbenzene) 370 360 660 210 2000

Xylenes (individual or mixed isomers) 270 260 490 150 1500

Analysis of the NPI database at the national level shows that domestic lawn mowing is the

- Fourth largest source of benzene contributing 7 to the total reported airshed load

- Fourth largest source of formaldehyde contributing 3 to the total reported airshed load

- Fifth largest source of xylene contributing 6 to the total reported airshed load

- Fifth largest source of toluene contributing 6 to the total reported airshed load

- Sixth largest source of carbon monoxide contributing 12 to the total reported airshed load

- Ninth largest source of VOCs contributing 3 to the total reported airshed load when biogenics (natural sources such as trees and soil) are excluded

The NSW Department of Environment and Conservation has been upgrading its emissions inventory Based on 2003 emissions data non-road anthropogenic sources

5

contribute 619 of the VOCs to the GMR airshed Preliminary results2 indicate that VOC emissions from domestic and public open space lawn mowing contributes on an annual average 41 of all VOC emissions in the GMR On a typical weekend during warmer weather this percentage rises to 11

Therefore it could be assumed that lawn mowing could contribute approximately 4 on average to VOC emissions from anthropogenic sources in major airsheds in Australia when public open space lawn mowing is included This percentage is likely to rise significantly in the warmer spring and autumn weekends which is when lawns and other vegetation grow faster and when more people garden

21 Air Quality Standards

In June 1998 the National Environment Protection Measure for Ambient Air (Air NEPM) established national uniform standards for ambient air quality for the six most common air pollutants ndash carbon monoxide nitrogen dioxide photochemical oxidants (measured as ozone) sulfur dioxide lead and particles less than 10 microns (PM10) The NEPM was varied in 2003 to include PM25 advisory reporting standards and in April 2004 a National Environment Protection Measure for Air Toxics was adopted

Nationally the common pollutants of most concern (particularly in major urban areas) are fine particles and ground level photochemical smog (measured as ozone) which is formed in the warmer months when volatile organic compounds (VOCs) and oxides of nitrogen (NOx) react in the atmosphere under the influence of sunlight in a series of chemical reactions

Recent health studies (cited in NEPC 2005) have strengthened the evidence that there are short-term ozone effects on mortality and respiratory disease The studies also strengthen the view that there does not appear to be a threshold for ozone below which no effects on health are expected to occur In recent years Australian epidemiological studies have been conducted which confirm the results of overseas studies that there is a relationship between elevated ozone levels and hospitalisations and deaths from certain conditions

There are two national ozone standards a one hour standard of 010ppm and a four hour standard of 008ppm with a goal that allows for one exceedance per year by 2008 Sydney experiences a number of days each year of ozone levels above these standards In 2003 Sydney exceeded the one hour standard on 11 days in 2003 19 days in 2004 and 9 days in 2005 The four hour standard was exceeded on 13 days in 2003 19 days in 2004 and 13 days in 2005 Further reductions in VOC and NOx emissions are needed to reduce ozone concentrations in Sydney to levels that would comply with the Air NEPM

The other jurisdictions meet or are close to meeting the current National Environment Protection (Ambient Air Quality) Measure (Air NEPM) ozone standards (NEPC 2005) However the ozone standards are being reviewed and based on current human health evidence the argument appears to be strengthening for tighter ozone standards

2 Presentation to Expert Panel 27 April 2006 by Nick Agipades Manager Major Air Projects NSW DEC

6

Should a stricter standard or an eight-hour standard consistent with international standardsguidelines be adopted achievability of Air NEPM ozone standards or goals could become an issue for some of the other major urban airsheds (NEPC 2005)

Modeling of ozone for Sydneyrsquos Greater Metropolitan Region (GMR) indicates that the implementation of Euro emission limits for on-road vehicles and hence the increased presence of these less polluting vehicles in the fleet and retirement of old more polluting vehicles from the fleet is not sufficient to meet the current NEPM goals Modeling suggests that very large reductions in precursor emissions would be required to meet the current ozone one hour goal (NEPC 2005)

Even when the effects of bushfires and when hazard reduction burning are taken into consideration airsheds such as Launceston Melbourne and Sydney struggle to meet the national standards for particles (EPA 2006) However outdoor powered equipment predominantly from two stroke engines makes only a minor contribution to ambient fine particle loads

While carbon monoxide emissions from engines used in outdoor garden equipment are regulated overseas air monitoring in Australia indicates that carbon monoxides levels are well below the national air quality standards and there are no pressing issues requiring CO from outdoor powered equipment to be regulated In addition data indicates that lowering emissions of VOCs and NOx from small engines reduces CO emissions

Many of the pollutant sources which contribute to the formation of ozone and to particle levels also contain air toxics such as benzene toluene formaldehyde and xylenes These air toxics have been shown to be responsible for a range of health problems including asthma respiratory illnesses and cancer The National Environment Protection Measure for Air Toxics requires each jurisdiction to monitor and report annually on five air toxics benzene polycyclic aromatic hydrocarbons formaldehyde toluene and xylenes The monitoring data is intended to inform future policy and also the public on ambient levels of these air pollutants Monitoring of air toxics to date shows that levels are low and below the national monitoring investigation levels (EPA Vic 2006 DEC 2006)

7

3 Emission Standards for Small Engines

31 Australia

At present there are no Australian regulations or standards to limit air pollutant emissions from small (two and four stroke) engines Australia does benefit to some extent from overseas regulations as many lawnmowers and other gardening equipment sold in Australia have engines manufactured in the United States or Europe where strict standards apply

32 United States

In the United States emission regulations set by the United States Environmental Protection Agency (USEPA) and the Californian Air Resources Board (CARB) apply to lawn mowers and other powered gardening equipment Although CARB standards currently tend to be stricter than USEPA standards by 2006 emissions limits applying under the two standards will be very similar

United States Environment Protection Agency (US EPA)

In 1995 the USEPA introduced ldquoPhase 1rdquo regulations covering small non-road engines with a power of not more than 19kW (25HP) The regulations applied to equipment manufactured from 1997

These regulations have seven classes of equipment based on portability and engine displacement volume (ldquocapacityrdquo) In March 2000 the USEPA published ldquoPhase 2rdquo regulations which are shown in Table 2 These set limits for combined emissions of hydrocarbons (HC) and oxides of nitrogen (NOx) and separate limits for carbon monoxide (CO) emissions and for two stroke engines only particles

Table 2 US EPA Phase 2 Small Engine Emissions Standards (HC+NOx in gkW-hr) (a) (b)

Small Engine Class

Type 2002 2003 2004 2005 2006 2007+

I-A (lt66cc) Non-handheld (eg lawnmowers)

- 161 161 161 161 161

I-B (66 to lt 100cc) - 161 161 161 161 161

I (100 to lt 225cc) - 161 161 161 161 161

II (225cc or more) 180 166 150 136 121 121

III (lt20cc) Handheld (eg trimmers)

238 175 113 50 50 50

IV (20 to lt50cc) 196 148 99 50 50 50

V (50cc or more) - - 143 119 96 72 (a) As carbon monoxide (CO) levels in Australia are well below the Air NEPM standard the

USEPA emission limits for CO have not been included in this table (b) Includes useful life criteria of 50125300 hours

8

When the USEPA introduced ldquoPhase 2rdquo regulations it included averaging banking and trading provisions (ABT) which were seen ldquoas an important element in making stringent Phase 2 emissions standards achievable with regard to technological feasibility lead time and costrdquo (USA 1999) The USEPA also claimed (USA 2000) that the ABT program secures early emissions benefits through the early introduction of cleaner engines

ABT provisions which apply to handheld and non handheld engines are complex but in broad terms averaging means the exchange of emission credits among engine families within a given engine manufacturerrsquos product line This allows a manufacturer to produce some engines that exceed the standards and offsetting these exceedances with emissions from engines that are below the standard Manufacturers are allowed to exchange credits from handheld to non handheld and vice versa Banking means the retention of emission credits by the engine manufacturer generating the credits for use in a future model year (for averaging or trading) Trading is the exchange of emission credits between engine manufacturers which then can be used for averaging purposes banked for future use or traded to another engine manufacturer

In January 2004 USEPA reported that in 2002 averaging was being used but there was very little use of banking It determined that the initial ABT programs as too complex and included discount rates on credits ABT was simplified in 2004 including the elimination of credit discount and multipliers and limits on credit life To date there has reportedly been limited use of banking however it is anticipated that there will be more widespread use of banking credits if the USEPA proposed Phase 3 comes into effect3 (see below)

Particulate limits (2gkW-hr) also apply to two stroke engines Carbon monoxide and durability limits (or useful life) are also prescribed The durability criteria which were introduced in Phase 2 require that the emission limits must be met through the useful life of the engine The manufacturer determines useful life of each product using standardised product testing procedures and then based on the test results selects the useful life category for each product which can be 125 250 or 500 hours These durability criteria acknowledge the large disparity in usage patterns by equipment type and between commercial and residential users It also takes into account the ability of manufacturers to design and build engines for various design lives and which fit the types of equipment engine is produced for

The March 2000 USEPA report (USEPA 2000) estimated that the expected effects of the Phase 2 regulations would be

bull A 70 reduction in HC+NOx beyond the Phase I standards (which were estimated to have reduced emissions by 32 from the unregulated baseline)

bull A 30 reduction in fuel consumption of small handheld equipment bull Price increases of between $US23 (Class III) and $US56 (Class V) for

handheld equipment

3 Dave Gardner Briggs and Stratton email 22506

9

The US EPA is currently considering lsquoPhase 3rsquo regulations which are catalyst based standards to further reduce exhaust HC and NOx emissions from non handheld engines reduce evaporative HC and NOx emissions for both handheld and non handheld engines plus include extended durability criteria These limits are currently at discussion stage only They align with CARB Tier 3 but a longer lead time is proposed

Table 3 Proposed Phase 3 Exhaust Emissions

HC+NOx gkW-hr

CO gkW-hr

Year Useful life hrs

Class I 100 610 2010 125250500

Class II 80 610 2011 2505001000

Class III-V No changes

HC+NOx std is based on averaging

Californian Air Resources Board (CARB)

Spark ignition engines

CARB regulations first introduced emission limits for small engines manufactured from1995 The more recent schedule of emission limits are shown in Table 4 These limits depend solely on the engine capacity and apply to both handheld and non handheld classes

Table 4 CARB Emission Limits for Small Engines (HC+NOx in gkw-hr)

Engine Capacity 2000-2001 2002-2005 2006+

65cc or less 72 72 72

gt65cc to 225cc 161 161 161

gt225cc 134 121 121

California has particle limits for two strokes useful life criteria and mandatory engine labeling including a consumer advisory hang tag as shown in Figure 1 The USEPA is also considering introducing an air index label

10

Figure 1 Example of a Californian Consumer Advisory Hang Tag The Californian regulations take into account sales weighted emission performance for families of engines An engine family is essentially the same engine being used in different equipment items

In 2003 California adopted a Tier 3 program for exhaust and evaporative emissions and these are based on the use of catalytic convertors The engine classes better align with US EPA categories however the exhaust standards for Class I and Class II are more stringent than the existing US EPA standards

Table 5 CARB Tier 3 for Exhaust Emissions

Model Year Displacement Category

Durability Periods (hours)

HC+NOx gkw-hr

CO gkw-hr

Particulate gkw-hr

2005 and subsequent

lt50 cc 50125300 50 536 20 + 50-80 cc inclusive 50125300 72 536 20 +

2005 gt80 cc - lt225 cc Horizontal-shaft eng

125250500 161 549

gt80 cc - lt225 cc NA 161 467 Vertical-shaft Engine 225 cc 125250500 121 549

2006 gt80 cc - lt225 cc 125250500 161 549 225 cc 125250500 121 549

2007 gt80 cc - lt225 cc 125250500 100 549 225 cc 125250500 121 549

2008 and subsequent

gt80 cc - lt225 cc 125250500 100 549 225 cc 1252505001000 80 549

the 1000 hours is applicable for 2008+ Model Year (MY) + applies to 2 stroke only Source California Exhaust Emission Standards and Test Procedures For 2005 And Later Small Off-Road Engines Adopted July 26 2004 effective on October 20 2004

California also has Blue Sky provisions These are voluntary standards for engines that meet the criteria shown in Table 6 Blue Sky Series engines are not included in

11

the averaging banking and trading program Zero-emission small off-road equipment (eg push mowers) may certify to the Blue Sky Series emission standards

In 2005 CARB aligned its test procedures with the USEPA

Table 6 CARB Blue Sky Provisions

Model Year Displacement Category

HC+NOx gkw-hr

CO gkw-hr

Particulate

2005 and subsequent lt50 cc 25 536 20

50 - 80 cc inclusive 36 536 20

2007 and subsequent gt80 cc - lt225 cc 50 549

2008 and subsequent 225 cc 40 549 Applicable to all two stroke engines

33 Canada

The Canadian small engine market has similarities to the Australia market the majority of small engines are imported from the USA and there is one Canadian manufacturer of small spark ignition engines and one major manufacturer of lawn and garden machines

A Memorandum of Understanding (MOU) which came into effect on 1 January 2000 was signed between Environment Canada and ten manufacturers of handheld equipment and nine manufacturers of engines used in non handheld machines The MOU was intended as an interim measure until regulations could be put in place Under the MOU the manufacturers agreed to voluntarily supply small spark ignition engines designed to meet the applicable USEPA Phase 1 emission standards

In 2003 Canada regulated emission limits for handheld and non-handheld small engines based on USEPA emission limits The regulations apply to model years 2005 and later While there are no separate averaging banking and trading provisions in Canadian regulations Canada allows any USEPA certified engine to be sold in Canada This means that engines that do not meet the standard level but are averaged (or use credits) in the United States can be sold in Canada Manufacturers are required to produce upon request evidence of conformity to the standards and are required to provide written instructions on engine maintenance to the first retailer

12

Table 7 Canadian Small Spark-Ignition Engine Exhaust Emission Standards

Engine class

Engine Type

Engine Displacement (cm3)

Effective date (model year)

Standard HC+NOx (gkWshyhr)

Standard NMHC+NOx (gkW-hr)

Standard CO (gkWshyhr)

I-A Non-handheld lt66 2005 and

later 50a -shy 610a

I-B Non-handheld

lt100 and 66

2005 and later

40a 37a 610a

I Non-handheld

lt225 and 100

2005r 161b 148a 519b 610a

II Non-handheld 225 2005 and

later 121a 113a 610a

III Handheld 20 2005 and later 50a -shy 805a

IV Handheld lt50 and 20 2005 and later

50a -shy 805a

V Handheld 50 2005 2006 2007 and later

119a 96a

72a

-shy-shy

-shy

603a 603a

603a a Standards apply throughout the engine useful life b Standards apply only when the engine is new Source Canada Gazette Part II Vol 137 No 24 2003-11-19

34 Europe

In 1998 the European Union introduced exhaust emission limits for small petrol engines through Directive 9768EC and in 2002 introduced amendments through Directive 200288EC The limits in the Directives align with the US regulations however they do not have averaging and banking provisions

Table 8 European Emissions Standards

Small Engine Class Type (HC+NOx in gkW-hr) 2004 2005 2006 2007 2008

SN1 (lt66cc) Non-handheld (eg lawn mowers)

161 161 161 161 161

SN2 (66 to lt 100cc) 161 161 161 161 161

SN3 (100 to lt 225cc) - - - 161 161

SN4 (225cc or more) - - 121 121 121

SH1 (lt20cc) Handheld (eg trimmers)

- - - 50 50

SH2 (20 to lt50cc) - - - 50 50

SH3 (50cc or more) - - - - 72

13

The European Union is currently considering including useful life criteria and averaging and banking provisions plus it is considering introducing a Directive to further reduce emissions from diesel engines The objective of the proposal is to tighten emissions standards for engines in general non-road applications in light of technological developments and it taking into account the parallel developments for similar legislation in the United States in order to harmonise the environmental standards and to facilitate trade

Charts comparing the USA Californian and European Emission Limits are shown below

14

35 Summary of Regulations for Non Handheld Equipment

KEY TO CHARTS

USEPA CARB EU

0

10

20

30

40

50

60

70

80

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

0 to 49cc

0

10

20

30

40

50

60

70

80

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

50 to 65cc

0

2

4

6

8

10

12

14

16

18

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

100 to 224cc

0

2

4

6

8

10

12

14

16

18

20

2000

2002

2004

2006

2008

Year Model

HC

+N

Ox g

kW

-hr

225cc and over (up to 19kW)

15

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

36 Summary of Regulations for Handheld Equipment

KEY TO CHARTS

USEPA CARB EU

20 to 49cc 0 to 19cc

250 250

200

150

HC

+N

Ox g

kW

-hr

100

200

HC

+N

Ox g

kW

-hr

150

100

50 50

0 0

Year Model Year Model

50 to 65cc 66 to 80cc

160

160

140

140

120

40 40

20 20

0 0

120

HC

+N

Ox g

kW

-hr

HC

+N

Ox g

kW

-hr

100100

8080

60 60

Year Model Year Model

16

Summary of Regulations for Handheld Equipment (continued)

KEY TO CHARTS

USEPA CARB EU

0

20

40

60

80

100

120

140

160

2000

2001

2002

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

81 to 224cc

0

20

40

60

80

100

120

140

160

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

225cc and over (up to 19kW)

17

4 Australian Market for Small Engines

41 Likely compliance with overseas emissions standards

As part of this assessment an environmental profile of equipment currently on the Australian market has been developed initially based on information from manufacturersrsquo brochures and web sites and industry magazines and then confirmed through follow-up with relevant industry contacts

Each item of equipment has been assessed on its compliance with USEPA CARB or European regulations In most cases it was not possible to match models available on the Australian market with CARB lists (CARB publishes exhaust emissions data on all appliances on its web site) This was mainly due to the inconsistency of model designations and uncertainty about ldquoengine familiesrdquo

Engine characteristics and retail price were difficult to obtain Some brochures also made claims of compliance with USEPA European or CARB requirements The detailed breakdown of current equipment on the Australian market is given in Appendix 1

The majority of small engines sold in Australia are imported and many come from countries that impose emission limits The extent of imports into Australia that do not comply with the country of origin standards is not known Industry estimates that 40 of garden products are sold through importers who are not linked to manufacturers of US EPA or European certified equipment and the source of some products sold here is difficult to establish Victa is the only company producing small engines in Australia Its iconic 2-stroke lawnmower currently cannot meet overseas emission limits

Outdoor Power Equipment Association (OPEA) assisted in identifying the Australian distributors of most brands of powered garden equipment In April 2006 a survey form was sent to a total of 43 distributors representing 97 brands of equipment The survey form sought information about the engine for all petrol-fuelled garden equipment with a power not more than 19kW

Figure 2 Extract from survey form

18

Initial response to the survey was poor Despite follow-up action and efforts from the industry association at the beginning of September 2006 26 distributors had responded to the survey information and only 13 distributors provided all data necessary for benchmarking purposes This resulted in emission compliance data for about half of the estimated products on the Australian market Attempts to match Australian models with the database maintained by the Californian Air Resources Board were also of limited success due to inconsistencies in model designations between Australia and the USA and the manner in which model information is coded in the CARB database

Table 9 Summary of distributor responses

Responses status Not OPEA OPEA ALL

Number of responses 9 8 (31) 17 (40)

Response - all data 4 9 13 (30)

Response - extra time sought 3 3 (7)

Response - no petrol products 4 1 5 (12)

Response - some data 5 5 (12)

Grand Total 17 26 43 percentages may not add to 100 due to rounding

Of the 97 brands initially identified

bull 16 brands are apparently no longer sold in Australia

bull No responses were received for 29 brands

bull Partial data were received for 12 brands

bull All data was available for 30 brands

Table 10 Summary of responses by brand

Count of brands

Analysis status Not OPEA OPEA All

Missing some data 12 12

No data received 9 (27) 20 (31) 29 (30)

No longer sold 13 3 16

Response - no models to list 3 7 10

Response received (electronic form) 5 11 16

Response received (paper form) 3 2 5

Response received (spreadsheet) 9 9

All 33 64 97

A 2004 report for the NSW DEC estimated that there were about 1200 eligible garden

19

products in the Australian market The current project has obtained data for a total of 870 products or 72 of the estimated population In addition the sampling method is likely to be biased towards products with good environmental performance In these circumstances the following analysis should be regarded as indicative only

Survey results

The following tables and figures show expected compliance with European CARB or USEPA requirements based on the limited information provided by industry

Table 11 Engine type and compliance with overseas standards Count of products Engine type

Best STD 2c 4c Unknown All 1997 - US EPA I 53 32 85 (10) 200288EU 17 17 (2) 2004 - US EPA II 1 3 4 (lt1) 2004 EURO I 8 8 (1) 2005 - US EPA II 10 29 5 44 (5) 2006 - US EPA II 107 141 2 250 (29) 2006 EURO I 6 6 (1) 2007 - US EPA II 1 1 (lt1) 2007 Euro II 2 2 (lt1) None 118 90 208 (24 Unspecified 24 60 161 245 (28) All 344 358 168 870

Unknown means the type of engine is unknown (but is most likely to be 2c) Unspecified means that the status of emissions compliance was unable to be identified None means the manufacturerdistributor has indicated that the equipment does not comply with any overseas emissions standard

Figure 3 Compliance with overseas standards - all surveyed products Note Unknown in chart includes unspecified and unknown from Table 11

20

Figure 4 Compliance with overseas standards by equipment type ldquoPhase 1 equivrdquo means the engine complies with US EPA phase 1 or 200288EU ldquoPhase 2 equivrdquo means the engine complies with US EPA Phase 2 Euro I or Euro 2 ldquoUnknown means that engine cycle (stroke) was not provided

Of the 41 categories of equipment in the survey 15 had at least 10 current products Results for these categories are set out below

Figure 5 Engine type for popular categories

21

Figure 6 Compliance with overseas standards for popular categories ldquoPhase 1 equiv means the engine complies with US EPA phase 1 or 200288EU Phase 2 equiv means the engine complies with US EPA Phase 2 Euro I or Euro 2 ldquoUnknown means that engine cycle (stroke) was not provided

42 Australian Sales of Outdoor Powered Equipment

The Australian Outdoor Power Equipment Association (OPEA) whose membership represents about 80 of the manufacturersdistributors and dealers in the industry commissions regular independent industry audits of garden equipment sales (OPEA personal communications) Sales data from OPEA is shown in Table 12

22

Table 12 Sales of outdoor garden equipment 2002 and 2005-06 2005-06 2 stroke (1000)

2002 2 stroke (1000)

2005-06 4 stroke (1000)

2002 4 stroke (1000)

2005-06 TOTAL (1000)

2002 TOTAL (1000)

Walk behind mowers 72 170 351 76 424 246

Brushcuttertrimmer 321 12 17 180 339 192

Chainsaws 152 0 0 90 152 90

Chipper shredders 0 60 46 0 46 60

Blowerblower vacuums 98 0 11 50 109 50

Ride on mowers 0 25 51 0 51 25

Generators 11 32 96 0 107 32

Hedge trimmers ampothers 40 192 0 28 40 220

694 491 476 424 1267 915

for total sales 593 463 407 537

for mowers 152 280 848 720

According to OPEA approximately 424000 walk behind lawnmowers and more than 792000 units of outdoor handheld equipment were sold in Australia in 2005-06 In addition there were sales of about 80000 replacement engines and 70000 pumps in 2005-06 most of which were four strokes These figures show that there has been considerable growth in the sales of most products with the exception of chipper shredders and the category lsquohedge trimmers and othersrsquo whose sales declined in 2005shy06 compared with those in 2002 About 17 of walk behind lawnmowers were two stroke and 83 four stroke which is an improvement in the uptake of cleaner engines when compared to 2002 when about 30 were two stroke The situation with handheld equipment is reverse with nearly 79 being two strokes compared to 47 in 2002 However many models of two stroke handheld equipment meet current US emission standards and care should be exercised in using engine type (two stroke or four stroke) as an indicator of emissions performance for this class of equipment

The OPEA 2005-06 sales estimates are shown in Figure 7 OPEA cautions that there is considerable uncertainty about the estimates for brushcutters and blowerblower vacuums as OPEArsquos figures only represent 50 and 60 respectively of sales of these products No estimates of future sales trends were identified during research for this project

23

Australian sales of 2 and 4 stroke outdoor equipment 2005-6

0 50 100 150 200 250 300 350 400

Walk behind mowers

Brushcuttertrimmer

Chainsaws

Chipper shredders

Blowerblower vacuums

Ride on mowers

Generators

Other

Annual sales (x 1000)

4s 2s

Figure 7 OPEA estimates of equipment sales in 2005-06 Note Blowervac is an industry term for equipment that combines blowing and vacuuming functions

Briggs and Stratton (Australia) who import engines from the USA supply the majority of the four stroke engines for handheld equipment sold in Australia and these comply with all the current USA and CARB regulations Imported handheld garden equipment is shipped fully assembled to a branch or distributor and is then sent to a retailer The retailer may or may not provide equipment servicing

OPEA members have expressed concern regarding the increasing sales of imported high polluting two stroke engines that allegedly do not meet any emission standards and come from countries that do not have emission standards One industry representative reported that some of the imported trimmers were being manufactured in China using outdated designs and tooling from two old bankrupt American companies and these are being sold here at about 30 of the price of traditional brands and very low cost generators from China now account for around 70 of total sales It is difficult to confirm this trend without undertaking a detailed examination of Australian import data however the significant increase in the sales of two stroke handheld equipment provides some support for this trend

On the other hand it is claimed by industry that the ride on mower market (predominately with compliant four stroke engines) has been stimulated by the Australian USA free trade agreement

24

5 Australian Users of Small Engines This section examines the market segments for garden equipment and customer purchasing behaviour

51 General Public

Purchasing behaviour

Research into consumer purchasing behaviour has found that consumers assess a product against a range of attributes for example price weight brand reputation servicing and parts availability warrantees and guarantees experience size promotions and discounts Studies have also revealed that up to 82 of Australians had bought products on the basis of social or environmental factors in the previous year (State Chamber of Commerce 2001) Related to this point the energy star rating ecolabel on whitegoods was viewed as a credible environmental claims system which is well regarded by the general consumer (Product Category Manager Mitre 10 personal communications)

As the purchase of small engine garden equipment by the general consumer is an infrequent purchase which carries a certain of amount of risk With small engines the risk can be functional risk (will not perform as expected) physical risk (for example safe features such automatic cut out on an electric lawn mower) or financial risk especially for the more expensive items The general consumer is likely to lessen the risk by seeking information and by evaluating the information on the available products over a period of time The consumer may also lessen the risk by

bull purchasing well known brands

bull buying the brand offering the best warrantees and guarantees

bull buying the most expensive brand and

bull buying a brand they have used before

Research indicates that the desired attributes of a product may not be well established at the start of a consumerrsquos search process but will often be refined as the consumer learns more about the product The consumer will also use a ranking and weighting process based on desired qualities and trade offs may be made

Reportedly purchases of engine operated garden equipment are based on price yard size fitness for purpose and other features such as weight and ease of starting (Product Category Manager Mitre 10 personal communications) Males are the predominant purchasers of garden equipment however because of changing demographics there has been an increase in the number of women purchasing these products

Less than 5 of lawnmowers purchased are push or electric mowers (Product Category Manager Mitre 10 and industry sources personal communications 2003)

25

Electric mowers are generally perceived as not being as effective as cords have limited range and rechargeable electric mowers require frequent recharging

There is a recent trend towards ride on mowers (all four strokes) probably because of changing demographics specifically older age groups moving to more rural environments with larger yards (OPEA personal communications)

A study (Wilkie 1994) investigated consumer appliance purchasing behaviour and found that the general consumer consulted a range of information sources before purchasing an appliance The appliance salesperson was found to be the most important information source for many consumers Other important information sources include newspaper advertisements friends and relatives catalogues consumer reports and brochureslabels Since Wilkiersquos study the internet will have become increasingly important as a research tool and in some instances as a way to purchase products As part of this study there is evidence of low priced products being sold into the Australian market via the internet only ndash a practice that is likely to increase in the future It was difficult to source any compliance or details on these products

At the retail chain level staff product training is generally voluntary undertaken out of store hours and as an inducement to attend training sessions suppliers usually provide incentives for staff Retail chain purchases are very price driven although some chains are reportedly interested in stocking goods that have credible environmental claims (Mitre 10 and other retail chain sources)

IBIS (2006a) reports that the domestic hardware sector which is dominated by Danks (Home Timber and Hardware Thrifty - Link Hardware and Plants Plus Garden Centre) and Bunnings is classified as a growth market and the sales of lawnmowers and other lawn and garden machinery and equipment represent about 14 of sales revenue

In summary it appears that a range of product attributes influences consumer purchases of lawnmowers and outdoor equipment Currently there is very little information about emissions in any of the information sources a consumer is likely to consult when purchasing these products Nevertheless surveys indicate that consumers are concerned about the environment and are open to including environmental considerations into their purchase decision Educating sales staff about the air emissions from lawnmowers and outdoor equipment together with ecolabels could therefore be important methods for influencing consumers towards the purchase of cleaner products

Equipment Usage

The USA Outdoor Power Equipment Institute CARB (cited in USEPA 1998) and the USEPA (USEPA 1998) have made estimates of annual usage rates and average life spans of outdoor equipment for the general consumer user and for the commercial user Table 13 gives USA usage and lifespan range for selected items of powered equipment

26

Table 13 USA Average Usage and Lifespan of Outdoor Garden Equipment For General Consumers and Commercial Users Equipment Annual usage (Hours) Lifespan (years)

General Consumer

Walk- behind mowers 20-25 6 -7

Rear engine ride on mowers 4 6 -7

Chainsaws 7 5-9

Leaf blowers 9-12 5-9

Trimmers 10 5-9

Commercial User

Walk- behind mowers 320 27

Rear engine ride on mowers 380 38

Chainsaws 405 1-13

Leaf blowers 170-293 18-28

Trimmers 170 - 275 15-28

Discussions with members of the Australian industry confirm that Australian hours of use are likely to be similar to the American estimates although this can vary depending on location For example in tropical areas lawns are mowed more often because they grow faster in this climate The American turnover of equipment is however probably higher than here as the Australian consumer tends to keep their equipment longer and so the useful life of a mower is more likely to be on average 10 ndash12 years

52 Garden and Ground Maintenance Services

According to a recent IBIS report (2006b) the revenue for this industry in 2005-06 was $383 million and the industry outlook is lsquobrightrsquo with a predicted annual average 5 growth over the next few years The Australian customer base for garden maintenance services including for lawn mowing is

Households 55 Business 25 Government 20

The sector is reportedly a growth industry due to

bull the aging population

bull the increasing numbers of households that are time poor income rich and

bull the growing trend for professional landscaping which requires a higher level of garden maintenance

27

The main customer base for these businesses includes middle to upper socioeconomic groups the aged and people who are physically disabled Growth is predicted particularly for the franchise industry with demand from the commercialindustrialgovernment sectors (IBIS 2003) A 1999 ABS survey reported that nearly one-third of older people purchased at least one domestic service per fortnight with gardening assistance being the most common This accords with an industry estimate that about 25 of householders pay someone to mow their lawn (Jim Penman Jimrsquos Mowing personal communication) The industry is sensitive to economic conditions and weather for example the drought has slowed growth over the last few years

The garden maintenance sector is dominated by small independent operators with two major franchisers Jimrsquos Mowing and VIP VIP nationally has 600 franchises and Jimrsquos Mowing about 400 Jimrsquos Mowing reportedly mows about 15000 lawns and has 53 of the market (IBIS 2006b) As franchised lawn mowing services represents about 14 of the lawn mowing services nationally it can be estimated that approximately 280000 lawns are mowed nationally by commercial operators

Jimrsquos Mowing and VIP provide training and advice to new franchisees on equipment including proper maintenance schedules Training generally occurs before franchisees purchase their equipment Most franchisees equipment would consist of two mowers a brushcutter an air blower and possibly a hedge trimmer or chain saw Operators prefer four stroke mowers and these are used for an average eight hours per week Brushcutters are generally two strokes as are other motors (IBIS 2006b and Jim Penman personal communication)

From the above it is estimated commercial operators operate mowers for up 34 million hours per year (or 8 of the total estimated mowing hours per year) and purchase approximately 66000 lawnmowers annually (25 of purchases) The sectorrsquos purchases of brushcutters is estimated to be approximately 8000 units per year or 37 of purchases Table 13 provides US commercial userrsquos annual average hours of use and average equipment life spans ndash it would be anticipated Australian rates would be similar

The main businesses contracting to provide ground maintenance services to the corporate and government sector (including universities) are Spotlessrsquos Open Space Management Transfield and Programmed Maintenance Services all of which are diversified publicly listed companies plus the Danish owned company ISS (previously Tempo Services) (IBIS 2003 and 2006b and company websites) The type of services they provide means it is likely they would have an array of equipment and a preference for the more powerful ride-on mowers and for Class V handheld equipment

53 Government Purchasing

The way purchasing decisions are made by government or other large organizations is generally very different to the approach taken by the general household consumer

bull many of the purchases are for large quantities of goods

28

bull there are well established policies and procedures in place to guide purchasing with the purchase criteria established early in the buying process and

bull those making the purchase are likely to be more knowledgeable about the product than the average consumer and they are usually not the eventual user of the goods

Value for money fitness for purpose ability to supply and over recent years environmental aspects are likely to be important factors in the purchasing decision for Government

Local State and Commonwealth Governments have responsibility for the upkeep of public assets many of which include public open space and other outdoors areas At the State and Federal level these include schools universities sporting facilities hospitals and defence facilities These services may be outsourced individual departments may undertake maintenance and purchase their own equipment or they may purchase equipment through a central purchasing facility With the central purchasing facility these items are generally purchased under contract While there is an increase in the inclusion of environmental considerations in the selection criteria for purchasing goods and services especially under contract these considerations mainly relate to waste management and recycling criteria and not air emissions

Local councils in some states for example NSW generally take responsibility for ground maintenance within their council areas or for some smaller councils the service may be contracted to a neighbouring council In other states such as Victoria there is a trend to outsource ground maintenance contracts to commercial providers

It is unknown what proportion of total sales that direct Government purchases represent however it likely to represent a relatively small share of several percent of the overall market

In summary

bull The general household consumer represents the major market segment for garden equipment accounting for up to 90 of product sales

bull Government is likely to be relatively small direct purchaser of garden equipment

bull Commercial garden services to households purchase approximately 25 of lawnmowers per year and 37 of brushcutters

bull Large ground maintenance companies are likely to prefer larger and more powerful equipment such as ride-on mowers

29

6 Result of Stakeholder Consultation

61 Regulations

The Small Engine Expert Panel ndash Outdoor Equipment considered in depth an approach to take to improve the emissions performance of outdoor garden equipment sold in Australia Discussions were particularly focused on the growing influence of cheap high emissions imported products together with the difficulties that the local manufacturer of lawn mowers is likely to face in complying with the relevant overseas standards As part of this process the industry representatives on the Panel held additional discussions and they consulted international industry experts at the manufacturing level in Europe the USA and Japan

OPEArsquos preference is for the adoption of regulations based on the USEPA standards with Phase 1 being adopted possibly from as early as 2007-08 The industry then proposes that Phase 2 be introduced in 2012 Phase 1 USA EPA standards were adopted in the USA in 1995 to be applied to equipment manufactured from 1997 and Phase 2 standards were introduced in 2002 through to 2007 and these included averaging banking and trading provisions A comparison between the USA Phase 1 and Phase2 standards is given in Table 14 The USEPA is discussing Phase 3 limits for the adoption in 20102011 which includes tighter exhaust emission limits for non-handheld equipment

The emissions limit of the two stroke lawn mower manufactured by the sole Australian manufacturer are well above USA Phase 1 limit for non-handheld equipment One avenue to address this issue which was supported by the Expert Panel ndash Outdoor Equipment would be to place lawn mowers in the US EPA Category 5 (engines gt50cc) This would result in emissions for two stroke lawnmowers being limited to 161 gkW-hour HC + NOx compared to the USA regulated limit of 161 gkW-hour HC + NOx Doing this would align the ramp-up timetable for mowers with that of other garden products

Table 14 Comparison between the USA Phase 1 and Phase 2 standards

Emission Limits GkW-hr

Phase 1 (1997 ndash2001) Phase 2 (2007) HC NOx HC+NOx CO HC+NOx CO

Non-handheld I-A lt66cc 161 610 I-B 66-lt100cc 161 610 I 100-225 cm3 161 519 161 610 II 225 cm3 134 519 121 610 Handheld III lt20 cm3 295 536 805 50 805 IV 20-50 cm3 241 536 805 50 805 V 50 cm3 161 536 603 72 603

Phase 2 limits were phased in between 2002 -2007 during which time they became tighter for simplicity only the 2007 are shown in this table (see Table 2 for more details)

30

In addition to limiting emissions the Expert Panel support the inclusion of the durability criteria which apply in the USA under Phase 2 standards and certification documentation from either the USA or Europe as adequate proof of conformity Equipment that has not been tested and certified to USA or European standards will be required to have the engines tested in a NATA certified laboratory

Some in the industry argued that regulations should include provisions for averaging for companies that wish to use it however they felt banking and trading provisions would not be necessary Industry representatives were not supportive of any Australian consumer labeling requirement instead OPEA members are willing to supply emissions data for inclusion in a web-based database that would allow purchasers to assess the environmental credentials of different makes and models

62 Discussion on recommended regulations

Timing of introduction

Some industry representatives argue that introduction of Phase 1 standards in 2007-08 will not give the industry an adequate transition period in which to develop competence in emissions certification establish new procedures and tooling in the dealers workshops train dealers and technicians on legal requirements distribute specific tooling and spare parts and reduce stocks of old (non certified) products without incurring an undue financial burden While others in the industry prefer progressing straight to phase 2 standards

If the OPEA preference for the adoption of the United States Phase 1 regulations which operated in the USA between 1995 and 2001 were introduced in Australia in 2007-08 they would be well behind the USA standards and worldrsquos best practice Furthermore the introduction of the United States Phase 2 - 2007 limits in Australia in 2012 would if the USEPA introduce Phase 3 in 2010-11 see emission limits for lawnmowers and other non handheld garden equipment in Australia still lagging United States standards and worldrsquos best practice

To introduce regulations in 2007-08 will require Government firstly to determine the most appropriate mechanism under which to enact the regulations draft the regulations prepare the regulatory impact assessment consult with the broader community and then finalise the regulations It is likely an Act of Parliament will be required at the Commonwealth level followed by complementary legislation at the State and Territory level It is possible for this to be achieved in less than a two year timeframe (as was the case for the Water Efficiency Labelling Scheme) However regulations that do not have a level of perceived urgency would take longer The level of importance and urgency to control emissions from small engines has yet to be debated and determined

31

Modified USEPA limits for lawnmowers

From the 183 lawn mowers identified through the market survey Victa is the main (possibly sole) provider of two stroke mowers with the other lawnmowers having cleaner four stroke engines

Victa is undertaking work to produce a cleaner product Victa estimates it would need a number of years to complete development production tooling and commercialisation of the cleaner engines In January 2007 it released a new two stroke carburettor lawnmower that has reduced engine emissions by more 30 but the combined HC and NOx emissions are still above USEPA Phase 1 limits Victa says this new engine is the outcome of four years of collaborative work by Victa and the University of Technology Sydney Victa is continuing with this research to further reduce emissions

A clause that allows exemptions to be granted as occurs in other countries could be included in the regulations however Victa argues that this would create uncertain trading conditions for the company for a period of time until an exemption were granted

Placing lawn mowers in the US EPA Category 5 (engines gt50cc) has the risk of opening the Australian market to more two stroke lawn mowers which has the greatest use of any outdoor powered equipment however it should see the continuance of the sole engine being manufactured in Australia In 1995 when it was introducing small engine emission limits the USEPA faced a similar issue with two stroke lawn mowers and used a similar approach by allowing two stroke lawn mowers to comply with the handheld standards It also specified that the number of two stroke lawnmower engines allowed to meet handheld standards would be subject to a declining annual production cap with the allowance provided by the production cap being phased out in 2003 There is also similar precedent for small engine emission limits that depend on engine type - European regulations for marine outboard motors set less stringent requirements for two stroke motors

Averaging Banking and Trading Provisions

The US EPA did not have averaging banking and trading provisions in Phase 1 and therefore all small outdoor engines were required to meet the Phase 1 limits It only introduced ABT provisions in the much more stringent Phase 2 as they would allow the most economic introduction of cleaner engines The industry claims the systems to use this provision are available and can be implemented in Australia by those who wish to use it at little cost to government

Industry claim that any supportive economic data related to averaging is sensitive and confidential It is there difficult without substantial justification by the industry to support the provision for averaging in conjunction with Phase 1 particularly given the elapsed time between the introduction of Phase 1 in the USA and their recommended introduction in Australia If there are some low volume equipment items that still cannot meet the USAEPA Phase 1 standards then these could be subjected to

32

exemptions if adequate justification can be provided (exemptions for small volumes were available under the USEPA regulations)

It was noted that for government to implement regulations a regulatory impact statement is required and this requires an assessment of the costs and benefits of the options considered with clear overall benefits shown for the preferred option Therefore if the option for manufacturers to use averaging were to be considered more information to support its inclusion would be required

Other options that could be considered to circumvent the inclusion of averaging include

i including clauses that give manufacturers the ability to apply for exemptions from the regulations for classes of equipment that have small sales volumes (these provisions are available in the USA)

ii limiting the regulation to popular types of equipment

iii using the end-of-model life provisions that have been used in the Australian Design Rules for cars In effect the end of model life provisions require new designs to comply from the implementation date but allow older models to remain on sale for a few more years This is an alternative to ABT because it facilitates earlier introduction of the regulation

iv Having a phase in period of say 2 years during which existing models can continue to be sold but new models coming on to the market must comply with the new standards At the end of the phase-in period all models must comply with the new standards This is an approach that is used when Australian Design Rules (ADRs) are introduced for motor vehicles

Consumer Information

Current Australian directions to reduce the environmental impact of consumer products favor tiered benchmarks using a lsquostarrsquo rating system (see Appendix 3 for examples such as the Mandatory Energy Efficiency Label and the Water Efficiency Labelling Scheme)

As products generally arrive in Australia assembled and packaged industry considers a mandatory requirement to label products with an Australian style star rating would impose a cost on distributors that would drive up the retail price of products Instead the OPEA members were willing to supply emissions data for inclusion in a web-based database that would allow purchasers to assess the environmental credentials of different makes and models Given the diverse nature of the industry it is unlikely a database would provide complete coverage of all products on the Australian market but inclusion in the database would indicate that the manufacturer has a commitment to environmental performance It was acknowledged in discussions that at least some Phase 2 compliant products would become available prior to 2012 and the web-based database would provide one method to promote those cleaner engines

33

In summary the Recommendations of the Expert Panel

1 Mandatory air pollutant emission standards to be introduced in Australia for all outdoor equipment (lt19kW) powered by spark-ignition engines The development of any regulation would need to be based on a formal assessment of the costs and benefits of nationally regulating 2 and 4 stroke lawn mowers and handheld power equipment which should be commenced immediately

2 Proposed standards to mirror US EPA regulations (compliance with equivalent EU regulations also acceptable)

3 Timing (subject to completion of assessment of costs and benefits)

(a) US EPA Phase 1 ndash Effective from 2007 2008

(b) US EPA Phase 2 ndash Fully implemented in 2012 (in step with 2007 USEPA limits) with phase-in period andor ABT over 2008-2012 to provide for early introduction of cleaner product

4 Walk-behind 2 stroke mowers to be included in US EPA Category 5 (gt50cc) product classifications Implementation timing to be as in Recommendation 3 above

5 All products also to be certified to relevant EPA durability categories

6 Subject to further review ABT (if included) may be phased out after 2012

34

7 The Way Forward

The optimum approach for garden equipment out engine emissions of options needs to be sustainable and cost effective This will need to be determined through a costs and benefits analysis (CBA) CBA assigns monetary values and typically assesses the impacts on the consumer on human health on the environment on industry and on government A detailed costs and benefits analysis is beyond the scope of this report however the following sections draws on available information to provide some indication of the possible costs and benefits that are associated with emissions from garden equipment engines

Air Quality Benefits

Environment Canada estimated the introduction of the regulations would result in a 44 percent reduction in combined HC+NOx emissions from small engines used in garden equipment and reduction in individual air pollutants over a 25 year period as shown in Table 15 The Canadian estimates incorporate the benefits that would accrue from the MOU signed with the industry in 2000 plus the benefits from the regulations introduced in 2003 In 2000 Canada imported around 13 million small spark-ignition engines and machines (ie a similar number to Australia) with 80 supplied by the USA

Table 15 Canadian Small Spark-Ignition Engine Emissions in Year 2025

Substance Base Case Emissions in 2025

Emissions in 2025 with Regulations

Percentage Reduction in 2025 (Regulations vs Base Case)

Criteria Air Contaminants (kilotonnes)

HC 772 410 469

NOx a 84 67 201

CO 1413 1403 07

Greenhouse Gas (kilotonnes)

CO2 2903 2645 89 Base case year 2000 (accommodating voluntary agreement) Source Canada Gazette Part II Vol 137 No 24 2003-11-19

Other Environmental Costs and Benefits

In addition to the human health benefits associated with reduced exposure to ozone there is a range of other public benefits including reduced damage to vegetation and therefore higher crop yields less damage to materials and structures particularly

35

some rubber products and improved visibility due to a reduction in smog haze Plus there are benefits associated with lower emissions of other air pollutants

To date there appears to have been little work undertaken in assigning a monetary value to these benefits as it is considered that they are likely to be small compared to human health impacts

Health Costs and Benefits

The Final Impact Assessment for the Ambient Air Quality National Environment Protection Measure (NEPC 1998) estimated that the health damage costs from exposure to ozone nationally to be in the range of $90 ndash $270 million (in 1998 dollars) This figure did not include mortality costs because of difficulty in assigning a figure to human life nor did it include costs associated with minor symptoms such as sore throat cough headache chest discomfort and eye irritation that can result from ozone exposure On the cost of ozone exposure the Impact Assessment states that lsquothe social well-being associated with potentially 6 and 20 million fewer irritating symptoms annually cannot be reliably quantified but at $1 a symptom it adds up to an appreciable amountrsquo

Since the Air NEPM Impact Assessment ozone levels in Australian urban areas have not fallen significantly but the population and medical costs have increased since then However using the above figures to make a rough estimate the contribution made by engines used in lawnmowers (ie not including other garden equipment) to the health damages cost from ozone exposure would be at a minimum $36 - $108 million not including the cost of mortality or minor symptoms As any action on these engines is likely to only remove high emission engines over a decade or more a CBA would be required to include an assessment of the proportional health benefits that would accrue from only removing the high emitters over time

Costs and Benefits to the Consumer

In 1995 the USEPA estimated that on average the cost to the engine manufacturer to install the necessary emission control technology to meet Phase 1 standards (which didnrsquot have ABT) would be approximately $US2 per engine used in nonhandheld equipment and $US350 per engine used in handheld equipment It also estimated that this would translate to sales-weighted average price increases of about $US7

The introduction of phase 2 regulations USEPA estimated would result in price increases of between $US20 and $US64 for handheld equipment depending on the equipment class (USEPA 2000) where handheld engines ranges in price from $60 to $1000 (USEPA 1995)

In addition to emission reductions the implementation of exhaust emission limits has the advantage of reducing fuel consumption and lowering operating costs to the consumer For example the USEPA estimated that for Phase 1 limits that applied between 1995 and 2001 on an average sales-weighted engine basis would decrease fuel consumption by 26 percent for non handheld equipment and a 13 percent decrease in fuel consumption for handheld equipment (USEPA 1995) Phase 2

36

(current limits) would result in a further decrease in fuel consumption of approximately 30 percent for handheld engines

When the USEPA considered the fuel savings offset and the retail price increase it estimated that the average sales-weighted lifetime increase in cost would be about $US650 per handheld engine while nonhandheld engines will realize a lifetime savings of about $US250 per engine This does not include the lifetime savings in maintenance costs which should further benefit the consumer (USEPA 1995)

Euromot (The European Association of Internal Combustion Manufacturers) claims that compliance with European minimum performance standards that do not have ABT provisions adds around 30 to the cost of some products that have had to be brought into compliance4 compared to products sold under the ABT system in the US

Costs and Benefits to Industry and Government

As there is only one local manufacturer among the 43 distributors of powered outdoor garden equipment sold in Australia and all others are importers the main costs to reduce the emissions contribution made by these engines will be associated with program administration and compliance particularly if regulations are introduced

The Productivity Commission an independent agency which is the Australian Governmentrsquos principal review and advisory body on microeconomic policy and regulation recently examined the cost effectiveness of measures to improve the energy efficiency in household appliances As part of its review lsquoThe Private Cost Effectiveness of Improving Energy Efficiencyrsquo it examined labelling programs (ie regulated tiered benchmarks) and minimum mandatory energy efficiency requirements (ie a regulated simple benchmark) While the household appliance market is considerably larger than the garden equipment market the Commissionrsquos final report contains some information that is useful for determining the approach that could be used to establish an emissions reduction scheme for garden equipment A summary of relevant sections of this report is provided in Appendix 3

The Commission identified both administration and compliance costs associated with labelling programs and minimum mandatory energy efficiency requirements as well the impacts these had on product suppliers

The Department of the Environment and Water Resources provided details to the Commission on the costs involved in administering both the labelling scheme and the minimum performance standards for energy programs The information provided showed that

bull the administration costs of the simple benchmark approach were substantially lower (less than one tenth) than for labelling and 84 per cent of administration costs were passed on to appliance purchasers with the remainder borne by governments

4 Presentation by Dr Holger Lochmann Rob Baker Axel Rauch Stihl 19 April 2006

37

bull the compliance costs for labelling are higher

bull minimum mandatory energy efficiency requirements can have a greater cost for suppliers than labelling since suppliers must adjust their model ranges to meet the MEPS levels by the given date These compliance costs are however influenced by the lsquolead inrsquo time between introduction and the implementation of the regulations

bull The increased cost to appliance purchasers of labelled appliances was about two and half times higher compared to appliances purchased under minimum mandatory energy efficiency requirements this being due to consumers voluntarily purchasing more efficient appliances

Overall the Commission considered that labels should be more actively considered as an alternative to minimum performance standards The Commissionrsquos support was based on the ability of labels to amongst other things

bull directly address ldquoa source of market failure mdash the asymmetry of information between buyers and sellers of energy-using productsrdquo

bull provide information to the consumer that is readily-accessible and easily-understood so they can help the consumer make better-informed choices

bull Have net social benefits and possibly have net benefits for consumers

bull provide a greater incentive for suppliers to sell environmentally better products

bull warn consumers through a disendorsement label that an appliance is very inefficient This approach can discourage but not prevent consumers from buying the poor performing product

71 Options to Reduce Emissions from Garden Equipment Engines

There is a range of options that could be considered for reducing emissions from engines used in outdoor garden equipment in Australia These include

1 Do nothing

2 Partnership Programs

3 Quasi regulation

4 Co-regulation

5 Regulations

In the following discussion about these options many Australian examples are mentioned Further details about these programs plus an overview are provided in Appendix 2

38

72 Option 1 ndash Do Nothing

Based on data supplied by OPEA the sales of high emitting two stroke carburettor engines as a percentage of engines used in outdoor equipment increased during the period 2002 to 2005-6 (see Table 12) from 463 to 593 and overall sales number increased by 38 during that period There is no indication that in the short to medium term that sales of equipment with two stroke carburetor engines will decrease in overall sales numbers or as a percentage of sales Therefore under the lsquodo nothingrsquo option emissions from outdoor garden equipment will continue at the same rate or perhaps based on sales figures of two stroke carburetor powered equipment at an even higher rate in the future

73 Option 2 ndash Industry - Government Partnership

In the discussion papers prepared for the NSW small engine project (2004) some examples of successful voluntary Government-Industry Partnership programs were provided The examples included were

bull the National Industry Reduction Agreement where the major newspaper and magazine publishers in Australia agreed to promote recovery and recycling of old newspapers and magazines

bull the NSW EPA-Oil Industry MOU on Summer Fuel the National Packaging Covenant (which has legislative backup) and

bull the EPA Victoriarsquos agreement with the Altona Chemical Complex

From the Australian programs reviewed it appears that the best indicators for successful partnership programs are

bull a relatively small number of firms within the industry

bull a commitment and involvement by all of the industry

bull clear program aims and objectives plus program targets and

bull a willingness by the industry to enter into a cooperative partnership with government

There are 43 identified distributors selling 97 brands of outdoor powered equipment in Australia Many of the major distributors are members of OPEA but there are many distributors who are not members It is therefore unlikely that the even the majority let alone all of the Australian distributors would commit to a industry-government partnership to reduce emissions

74 Option 3 - Quasi Regulation

Quasi regulations can take a range of forms the most usual being the establishment of a code of practice that industry endorses and implements A fundamental part of the code of practice would be emissions standards There are few examples of the use of codes of practice to limit emissions

39

Governmentrsquos role under this scenario is likely to be in assisting in the development of standards

The likelihood of this option being successful for similar reasons to the industry government partnership option is low

75 Option 4 -Co Regulation

Co-regulation is an agreement by industry and government to certain undertakings that support the uptake of cleaner products with a regulatory base It allows industry program flexibility to achieve certain negotiated targets Australian examples of coshyregulation include

bull The Green Vehicle Guide which operates through an industry government agreement where industry report test results to government in an agreed format within a certain timeframe Government manages the data and promotes the program This program is underpinned by Australian Design Rules for motor vehicles

bull The electrical appliance stand-by power program where there are agreed targets established that industry is required lsquovoluntarilyrsquo to meet failure to achieve the targets will result in regulation

bull The Packaging Covenant which is a program that allows industry the flexibility to design it own programs to reduce packaging waste and achieve certain target The Covenant is complemented by the NEPM on used packaging which specifies certain government responsibilities to support the program plus measures that will be introduced if targets are not met

Given the large number of distributors on the Australia market co-regulation for engines used in garden equipment using a similar form to the standndashby power program or the packaging program - an agreement by industry and government on a percentage reduction target for the sale of high emitting engines within a specified timeframe together with an agreement that regulation will be adopted if the target is not met ndash is also unlikely to be successful

76 Option 5 - Regulation

Regulation which requires a clear acknowledgement of a sufficient problem by Government places uniform mandatory compliance obligations on industry The costs associated with regulations are usually shared between government and industry with the development of regulations and program administration costs being borne by government with industry meeting compliance costs including emissions testing and if applicable labelling costs

It could argued that regulation should be introduced in the States or Territories where there are exceedances of the Air NEPM ozone standards However development of state based regulations for garden equipment engines emissions is unlikely as they would be incompatible with the 1992 Intergovernmental Agreement on the

40

Environment signed by the Commonwealth States and Territories and existing Commonwealth and State Government mutual recognition legislation The Intergovernmental Agreement on the Environment which underpins the development of National Environment Protection Measures obligates all jurisdictions to ensure equivalent protection from air pollution to all Australians

In addition enforcement of any state based legislation would be a key problem Under the Commonwealth Mutual Recognition Act 1992 and the Trans-Tasman Mutual Recognition Act 1997 goods that are imported into or produced in an Australian State or Territory or New Zealand that can be sold lawfully in that jurisdiction can be sold freely in a second jurisdiction even if the goods do not comply with the regulatory standards of the second jurisdiction This means non-regulated small engine products legally sold in one State could be legally sold in any other state regardless of whether emissions limits on small engines applied in that State

National regulation on the other hand would provide national consistency It would also provide the opportunity to adopt worldrsquos best practice standards and incorporate penalties for non-complying parties

Under the Australian Constitution the Commonwealth does not possess specific legislative powers in relation to the environment and heritage There are however a number of legislative powers that can support environment and heritage legislation Furthermore Commonwealth legislative powers can be used cumulatively For example the Commonwealth Parliament can make laws under section 51(20) of the Constitution with respect to ldquoforeign corporations and trading or financial corporations formed within the limits of the Commonwealthrdquo

Legislative mechanisms may also be created through the development of a National Environment Protection Measure (NEPM) that then becomes law within each jurisdiction A NEPM can accommodate flexibility of implementation where jurisdictions that have elevated ozone levels can tailor their NEPM program to their specific air quality needs An example of this flexible approach is the Diesel NEPM which has a suite of programs which can be implemented by jurisdictions

From the review of Australian regulations to reduce the environmental impacts of products and the overseas approaches to control emissions from small engines two regulatory approaches become apparent a simple benchmark or tiered benchmarks These are outlined below

Regulatory Option1 - A Simple Benchmark Approach

The most basic regulatory approach that could be taken would be to have a single emission standard (or as per the USA Europe and California a number of emission standards based on power and application) for combined HC + NOx emissions All equipment with new engines sold in Australia from the date the regulations are introduced This approach would

bull remove the all high emission engines from sale

41

bull be supported by an Australian Standard and

bull provide consumers with confidence that all products meet certain emissions standard

Regulatory Option 2 -Tiered Benchmarks

Current Australian directions to reduce the environmental impact of consumer products favour tiered benchmarks using a lsquostarrsquo rating system (see Appendix 2 for examples)

For engines used in garden equipment a tiered emissions labelling system could be based on the USEPA Phase 1 and Phase 2 standards use a system of lsquostarsrsquo to provide information to consumers about environmental performance but not limit consumer choice A tiered lsquostarrsquo system approach would

bull reward those products with more stars that meet the more stringent overseas standards

bull either operate with minimum emissions performance standards or disendorsement labels

bull be supported by a product label and possibly a web database

bull provide consumers emissions information and the option to purchase a lower emission engine

bull be supported by an Australian Standard and

bull be devised to meet worldrsquos best practice which is an overarching approach supported by Government

Table 16 summarises the main strengths and weaknesses of the above options

42

Table 16 Main Strengths and Weaknesses of Each Option

Strengths Weaknesses

Do Nothing Does not limit consumer choice Emissions contribution likely to grow No cost to government No barrier to new market entrants selling

high emitters Consumers have a wide choice of products Industry unchecked amp product dumping

likely No enforcement recourse on environmental grounds available

Partnerships Some sharing of responsibility government Slow if any reduction in high emitters

ndash industry

Potential for Government assist in Few if any companies likely to join and no advancing reductions in high emitters restrictions on non signatories Reduction targets set Below worldrsquos best practice

Quasi Regulation Similar strengths to partnership option Similar weaknesses to partnership option as

few if any companies likely to adopt code of practice

Co-Regulation Ongoing consultation between industry and Due to industry diversity targets unlikely to government recourse to regulation be met Targets set and can require new market Slow reduction in emissions entrants to achieve targets Can have implementation flexibility Emissions test standard adopted

Regulation Option 1- Simple Benchmark Worldrsquos best practice standards can be ovide incentives to manufacturers to promote low adapted and is mandatory emitters

Recourse to legal action available for non Does not provide consumers with emissions compliance information Significant quantifiable health benefits Cost of enforcement borne by taxpayers Requires compliance by all industry and High cost to government bans high emitters

Regulation Option 2 ndash Tiered Benchmarks Provides consumers with emissions information but does not limit choice Incentives for manufacturers to sell low emitters Potentially significant quantifiable health benefits Can be designed to overcome ABT issue

Significant administration and compliance costs to Government High cost to government and industry and will increase retail price of engines Does not ban high emitters

43

77 Preferred Approach

From the above discussion and from the review of garden equipment on available to the Australian consumer there are many companies selling powered garden equipment on the Australian market and the market is very competitive Furthermore from the Expert Panel discussions and stakeholder consultation it is apparent that it is highly unlikely that all the companies in the garden equipment industry would engage in or commit to a voluntary program to reduce their productsrsquo exhaust emissions It is therefore clear that the only feasible path to reduce emissions from these small engines is through regulation

While regulations of emissions from small engines used in garden equipment in Australia are likely to be based on overseas regulations they need to strike a balance between improved environmental outcome harmonisation with international standards and the characteristics of the local industry With regulation optimum emissions reductions are achievable especially by combining minimum emissions standards with tiered product labelling Whether this approach is justifiable on economic grounds that is the benefits outweigh the costs can only be determined through a detailed impact assessment Based on these findings it is recommended that a formal assessment of the costs and benefits of nationally regulating 2 and 4 stroke lawn mowers and handheld power equipment should now be commenced

44

References Air Resources Board California Environmental Protection Agency Californian Exhaust Emission Standards and Test Procedures for 2005 and Later Small Off-road Engines July 26 2004

Artcraft 2003 A Major Research-Based Review and Scoping of Future Directions for Appliance Efficiency Labels in Australia and NZ prepared for the Australian Greenhouse Office viewed at wwwenergyratinggovaulibraryindexhtml

Australian Bureau of Statistics 1999 Older People Australia A Social Report Report Number 41090 December 1999

Australian Greenhouse Office 2002 Achievements 2002 National Appliance equipment energy efficiency program Commonwealth of Australia

Australian Greenhouse Office 2002 Achievements 2002 National Appliance equipment energy efficiency program Commonwealth of Australia

AustralianNew Zealand StandardtradeASNZS 64002005 Water efficient productsmdashRating and labeling Federal Register of Legislative Instruments F2005L01571

Bei L T and Widdows R1999 Product knowledge and product involvement as moderators of the effects of information on purchase decisions a case study using the perfect information frontier approach Journal of Consumer Affairs 33(1) 165-186

Buy Recycled Busines Alliance Briefing Paper Environmental Claims And Labelling Abstract lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10-2003

California Code of Regulations 1998 Final Regulation Order Article 1 and Article 3 Chapter 9 Division 3 Title 13 Attachment 1 26 March 1998 wwwarbcagovregactsoreregs_finpdf

Canada Gazette Part II Vol 137 No 24 2003-11-19

Canadian Gazette 29 March 2003 Vol 137 No 13 Part 1 pp 935- 955

Cap Gemini Ernst amp Young (2001) Cars Online 2001 Global consumer survey httpa593gakamainet75931951a8b278a28319eawwwcgeycomhightechautomediaC ars_online2pdf

Clothes Washers Australiarsquos Standby Power Strategy 2002 ndash 2012 Standby Product Profile 200308 October 2003 wwwenergyratinggovau

Craig ndash Lees M Joy Sally Browne B 1995 Consumer Behaviour John Wiley amp Sons Queensland 1995

Department of Environment and Conservation NSW 2004 Measures to Encourage the Supply and Uptake of Cleaner Lawnmowers and Outdoor Handheld Equipment

45

Department of Environment and Conservation 2003 Who cares about the environment in 2003 A survey of NSW peoplersquos environmental knowledge attitudes and behaviours DEC Social Research Series

Department of Environment and Conservation Action for Air update 2006

Department of Environment and Conservation The Buy Recycled Guide Online Directory viewed at wwwresourcenswgovauindex-RNSWhtm

EcoRecycle 2004 Paint Take-Back Takes Off in Bayswater Media release 24 March 2004 viewed at wwwecorecyclevicgovau May 2004

Enviromower viewed at wwwenviromowercomau June 2004

Environment Canada 2000 Future Canadian Emission Standards for Vehicles and Engines and Standards for Reformulation of Petroleum Based Fuels Discussion Paper in Advance Notice of Intent by the Federal Minister of the Environment April 2000 wwwecgccaenergfuelsreportsfuture_fuelsfuture_fuels1_ehtm

Environment Canada 2004 Environment Minister Urges Canadians to Reduce Greenhouse Gas Emissions and Mow Down Pollution With Unique Incentive Program Media Release April 23 2004 viewed at wwwecgccamediaroomnewsrelease May 2004

Environment Protection and Heritage Council National Environment Protection (Ambient Air Quality) Measure Report on the Preliminary Work for the Review of the Ozone Standard October 2005

Environment Protection Authority 2006 Victoriarsquos Air Quality ndash 2005 Publication 1044 June 2006 wwwepavicgovau

Environmental Choice NZ 2001 Public Good and Environmental Labelling An Internal Background Paper

European Commission Directive 200344EC amending the recreational craft directive and comments to the directive combined 211005

George Wilkenfeld and Associates Pty Ltd with Artcraft Research and Energy Efficient Strategies Tomorrow Today 2003 Final Report A Mandatory Water Efficiency Labelling Scheme for Australia Prepared for Environment Australia June 2003

George Wilkenfeld and Associates 2003 A National Strategy for Consumer Product Resource Labelling in Australia prepared for the Australian Greenhouse Office December 2003 viewed at wwwenergyratinggovaulibraryindexhtml

Green Vehicle Guide wwwgreenvehicleguidegovau

Harrington L and Holt S 2002 Matching Worldrsquos Best Regulated Efficiency Standards ndash Australiarsquos success in adopting new refrigerator MEPS wwwenergyratinggovaulibrarypubsaceee-2002apdf

46

Harris J and Cole A 2003 The role for government in ecolabelling ndash on the scenes or behind the scenes lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10-2003

Holt S and Harrington L2003 Lessons learnt from Australiarsquos standards and labeling program Paper presented at ECEEE Summer Study - 2-6 June 2003 wwwenergyratinggovaulibraryindexhtml

IBIS 2006a Domestic Hardware Retailing 09-Jun-2006 Industry Code G523b

IBIS 2006b Gardening Services 18-Jan-2006 Industry Code Q9525

IBIS 2003 Gardening Services in Australia 23 December 2003 Industry Code Q9525

Lawrence K Zeise K amp Morgan P 2005 Management Options for Non-Road Engine Emissions in Urban Areas Consultancy report for Department for Environment amp Heritage Canberra

Motor Vehicle Environment Committee (MVEC) in consultation with the Department of Transport and Regional Services 2002 Proposal for an Australian ldquoGreen Vehiclesrdquo Guide viewed at httpwwwdotarsgovaumvegreen_vehicles_guidedoc May 2004

National Appliance and Equipment Energy Efficiency Committee The Energy Label at wwwenergyratinggovau (3504)

National Environment Protection Council 2005 National Environment Protection (Ambient Air Quality) Measure Report on the Preliminary Work for the Review of the Ozone Standard October 2005

National Environment Protection Council 1998 Final Impact Assessment for Ambient Air Quality National Environment Protection Measure June 1998

National Environment Protection Council 1999 Used Packaging Materials Impact Statement for the Draft NEPM Used Packaging Material January 1999 viewed at wwwephcgovau

National Environment Protection Council 2004 National Environment Protection (Air Toxics) Measure April 2004 viewed at wwwephcgovau

New South Wales Government 2002 Protection of the Environment Operations (Clean Air) Regulation 2002

New South Wales Government 1999 NSW Government Procurement Policy Statement White Paper 1999

Nordic Council 2002 Ecolabelling of marine Engines Criteria Document 8 December 1995 ndash 6 December 2005 version 35 December 2002

47

Office of Public Sector Information Statutory Instrument 2004 No 2034 The Non-Road Mobile Machinery (Emission of Gaseous and Particulate Pollutants) (Amendment) Regulations 2004 wwwopsigovuksisi200420042034htm

Outdoor Power Equipment Institute 2001 Profile of the Outdoor Power Equipment Industry wwwopeiorg

Productivity Commission 2004 The Private Cost Effectiveness of Improving Energy Efficiency Final report October 2005 wwwpcgovauinquiryenergy

Publishers National Environment Bureau Media Release lsquoAustralia leads the world in newspaper recyclingrsquo 6 June 2006 wwwpnebcomau

Real J Jones A 2005 The Green Vehicle Guide Clean Air Soceity of Australia and New Zealand Conference 2005 Hobart

Salmon G Voluntary Sustainability Standards and Labels (VSSLs) The Case for Fostering Them OECD Round Table On Sustainable Development

Schkade D A and Kelinmutz D N 1994 Information displays and choice processes differential effects of organization form and sequence Organizational Behavior and Human Decision Processes 57(3) 319-337

Stephens A 2003 Eco Buy (Local Government Buy Recycled Alliance Victoria) Abstract lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10shy2003

Teisl M F Roe B and Hicks RL 2002 Can eco-labels fine tune a market Evidence from dolphin-safe labeling Journal of Environmental Economics and Management 43339-359

Teisl M F Roe B and Levy A S Ecolabelling What does consumer science tell us about which strategies work pp141-150

The ISO 14000 family of standards guides and technical reports

The Parliament of the Commonwealth of Australia 2004 House of Representatives Water Efficiency Labelling and Standards Bill 2004 Explanatory Memorandum wwwcomlawgovauComLawLegislationBills1nsf viewed February 2006

Thogerson J 2000 Promoting green consumer behaviour with eco-labels Workshop on Education Information and Voluntary Measures in Environmental Protection National Academy of Sciences ndashNational Research Council Washington DC November 29-30

United States Environmental Protection Agency Federal Register Vol 60 No 127 3 July 1995 Control of Air Pollution Emission Standards for New Nonroad Spark-ignition Engines At or Below 19 Kilowatts wwwepagovEPA-AIR1995JulyDay-03prshy805txthtml

48

United States Environmental Protection Agency Federal Register Vol 69 No 7 12 January 2004 Rules and Regulations 40 CFR Part 90 Amendments to the Phase 2 Requirements for Spark-Ignition Nonroad Engines at or Below 19 Kilowatts Direct Final Rule and Proposed Rule wwwepagovfedrgstrEPA-AIR2004JanuaryDay-12a458pdf

United States Environmental Protection Agency Office of Pollution Prevention and Toxics Pollution Prevention Division 1998 Ecolabelling Environmental Labelling - A Comprehensive Review of Issues Policies and Practices Worldwide

United States Environmental Protection Agency Office of Transportation and Air Quality March 2000 Regulatory Announcement Final Phase 2 Standards for Spark-Ignition Handheld Engines

United States Environmental Protection Agency 1998 Proposed Phase 2 Emission Standards for Small SI Engines 27 January 1998

United States Environmental Protection Agency 2000 Regulatory announcement Final Phase 2 Standards for Small Spark-Ignition Handheld Engines March 2000 EPA420-F-00shy007

United States Federal Register Vol 69 No 7 Monday January 12 2004 Rules and Regulations Environmental Protection Agency 40 CFR Part 90 Amendments to the Phase 2 Requirements for Spark-Ignition Nonroad Engines at or Below 19 Kilowatts Direct Final Rule and Proposed Rule United States Federal Register Vol 64 No 60 30 March 1999 40 CFR Part 90 Phase 2 Emission Standards for New Nonroad Spark-Ignition Nonhandheld Engines At or Below 19 Kilowatts Final Rule pp15214-15216

United States Federal Register Vol 65 No 80 25 April 2000 40 CFR Parts 90 and 91 Phase 2 Emission Standards for New Nonroad Spark-Ignition Handheld Engines at or Below 19 Kilowatts and Minor Amendments to Emission Requirements Applicable to Small Spark-Ignition Engines and Marine Spark-Ignition Engines Final Rule pp24282-24284

United States Environmental Protection Agency Control of Air Pollution Emission for New Nonroad Spark-ignition Engines At or Below 19 Kilowatts Final Rule 40 CFR Parts 9 and 90 1995 wwwepagovEPA-AIR1995JulyDay-03pr-805txthtml

United States Environmental Protection Agency Office of Pollution Prevention and Toxics Pollution Prevention Division 1998 Ecolabelling Environmental Labeling- A Comprehensive Review of Issues Policies and Practices Worldwide

Victorian Government Greenhouse Strategy Community Action Fund - Mow Down Lawn Mower Rebate Exchange Program wwwgreenhousevicgovaucommunitygrantscafsuccessfulprojectshtm

Water Efficiency Labelling and Standards Act 2005 No 4 wwwcomlawgovauComLawLegislation

49

Water Efficiency Labelling and Standards Determination 2005 wwwcomlawgovauComLawLegislationLegislativeInstrument1nsf

Water Efficiency Labelling and Standards Regulations 2005 wwwcomlawgovauComLawLegislationLegislativeInstrument1nsf

Wilkie W 1994 Consumer Behaviour John Wiley and Sons NY as cited in Craig ndash Lees M Joy Sally Browne B 1995 Consumer Behaviour John Wiley amp Sons Queensland 1995

wwwenergyratinggovau

wwwgreenvehicleguidegovau

wwwwaterratinggovau

50

Appendix 1 Detailed Breakdown of Powered Garden Equipment on the Australian Market

The following table gives a profile of the current equipment on the Australian market It is based mostly on distributor responses to a survey and might not be representative of the total market

Low sales indicates that no sales data was available but volumes are likely to be small compared with popular equipment Phase 1 is US EPA Phase 1 or EU Directive 200288EU Phase 2 is US EPA Phase 2 or Euro standards

Type Ranges Stroke Aerator 5 makes 6 models Sales Low

Engine power 26 to 172kW Engine displ 143-674 ml

2c -4c 5 Unspecified 1 Phase 1 - Phase 2 4

Auger 3 makes 5 models Sales Low

Engine power 12 to 16kW Engine displ 31-ml

2c 5 4c -Unspecified -Phase 1 1 Phase 2 1

Backhoe 0 makes 0 model Sales Low

(2 models in 2003) -

Blower 13 makes 49 models Sales 109K

Engine power 07 to 31kW Engine displ 24-80ml

2c 34 4c 2 Unspecified 13 Phase 1 10 Phase 2 17

Blower-wheeler 3 makes 6 models

Engine power 07 to97kW Engine displ 24-305ml

2c 1 4c 4 Unspecified 1 Phase 1 3 Phase 2 -

Blowervac 6 makes 9 models Sales

Engine power 07 to 11kW Engine displ 24-34ml

2c 6 4c -Unspecified 3 Phase 1- Phase 2 3

Brush cutter 12 makes 95 models Sales 339K

Engine power 06 to 23kW Engine displ 21-54ml

2c 66 4c 5 Unspecified 24 Phase 1 15 Phase 2 34

Chainsaw 9 makes 106 models Sales 152K

Engine power 1 to 58kW Engine displ 26-122ml

2c 74 4c -Unspecified 32 Phase 1 18 Phase 2 27

Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

51

Type Ranges Stroke Clearing saw Engine power 14 to 27kW 2c 6 3 makes Engine displ 36-57ml 4c 0 9 models Unspecified 3 Sales low Phase 1 4 Phase 2 -Cultivator Engine power 07 to 52kW 2c 2 4 makes Engine displ 25-190ml 4c 5 7 models Unspecified -Sales low Phase 1 - Phase 2 5 De-thatcher Engine power 1kW 2c 1 1 makes Engine displ 27ml 4c -1 models Unspecified -Sales low Phase 1 - Phase 2 1 Drill Engine power 1kW 2c 3 3 makes Engine displ 27ml 4c -4 models Unspecified 1 Sales low Phase 1 - Phase 2 1 Edger Engine power 1 to 4kW 2c 12 10 makes Engine displ 24-190ml 4c 11 36 models Unspecified 1 Sales Phase 1 3 Phase 2 22 Garden tractor Engine power 12 to 157kW 2c -2 makes Engine displ 465 to 675ml 4c 5 12 models Unspecified 9 Sales low Phase 1 - Phase 2 3 Grass trimmer Engine power- 2c 3 1 make Engine displ 31ml 4c -3 model Unspecified -Sales Phase 1 - Phase 2 3 Hedge trimmer Engine power 06 to 1kW 2c 28 10 makes Engine displ 21-31ml 4c 1 42 models Unspecified 13 Sales 40K Phase 1 4 Phase 2 35 Lawnmower Engine power 26 to 66kW 2c 22 19 makes Engine displ 100-270ml 4c 151 183 models Price $449-$3609 Unspecified 10 Sales 424K Phase 1 95 Phase 2 48 Line trimmer Engine power 07 to 45kW 2c 25 8 makes Engine displ 24-195ml 4c 2 29 models Price $136-$299 Unspecified 2 Sales Phase 1 2 Phase 2 6 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

52

Type Ranges Stroke Log splitter Engine power 26 to 45kW 2c -1 makes Engine displ 100-195ml 4c 2 2 models Unspecified -Sales low Phase 1 - Phase 2 1 Multicutter Engine power 08 to 14kW 2c 17 5 makes Engine displ 23-36ml 4c 1 19 model Unspecified 1 Sales Phase 1 2 Phase 2 13 Olive nut shaker Engine power - 2c -1 make Engine displ - 4c -1 model Unspecified 1

Phase 1 - Phase 2 -Pole saw Engine power 08 to 14kW 2c 6 4 makes Engine displ 23-36ml 4c -10 models Unspecified 4 Sales low Phase 1 1 Phase 2 3 Power carrier Engine power 37 to 231kW 2c -2 makes Engine displ 160 to 953ml 4c 11 11 models Unspecified -Sales low Phase 1 - Phase 2 10 Power cutter Engine power 32 to 45kW 2c 5 2 makes Engine displ 64-99ml 4c -8 models Unspecified 3 Sales low Phase 1 1 Phase 2 3 Pruner (3 models in 2003) 2c -0 make 4c -0 models Unspecified -Sales low Ride-on-mower Engine power 26 to 231kW 2c -12 makes Engine displ 100 to 725ml 4c 93 124 models Unspecified81 Sales 51K Ph1 1 Ph2106 Rotary hoe (4 models in 2003) 2c -0 makes 4c -0 models Unspecified -Sales low Shredder Engine power 3 to 96kW 2c 1 6 makes Engine displ 126-389ml 4c 16 20 models Unspecified 3 Sales 46K Phase 1 - Phase 2 4 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

53

Type Ranges Stroke Stump grinder Engine power 96kW 2c -1 make Engine displ 389ml 4c 1 1 model Unspecified -Sales low Phase 1 - Phase 2 1 Tiller Engine power 08 to 59kW 2c -3 makes Engine displ 25-243ml 4c 8 9 models Unspecified 1 Sales low Phase 1 - Phase 2 7 Trencher Engine power37kW 2c -1 makes Engine displ 183ml 4c -1 models Unspecified 1 Sales low Phase 1 - Phase 2 1 Trimmer Engine power - 2c 10 2 makes Engine displ - 4c -21 models Price - Unspecified 11 Sales Phase 1 4 Phase 2 -Turfcutter Engine power 37kW 2c -1 makes Engine displ - 4c 1 1 models Unspecified -Sales low Phase 1 - Phase 2 -Vac Engine power 22 to 172kW 2c 1 5 makes Engine displ 158 to 674ml 4c 13 15 models Unspecified 1 Sales Ph11 Ph24 Vac chipper Engine power 34 to 45kW 2c -2 makes Engine displ 158-195ml 4c 3 3 models Unspecified -Sales low Phase 1 - Phase 2 1 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

54

Appendix 2 Examples of Current Australian Benchmarking Programs

The following describes in varying degrees of detail a number of current Australian benchmarking schemes classified by program type simple bench mark approaches tiered benchmarks and government industry partnerships This appendix concludes with a summary table of these programs with an assessment of their effectiveness

1 Introduction

Simple benchmark schemes (described below) such as the woodheater standards set a single point hurdle rate whereas the green vehicle guide use tiered benchmarks The new water efficiency labelling scheme and minimum energy efficiency performance standards uses both a simple benchmark through minimum performance requirement plus tiered benchmarks incorporated into labels as lsquostarsrsquo Other approaches such as the stand-by power program and the Victorian Altona Complex VOC reduction target set goals for achievement within a specified time period Other approaches taken to reduce environmental impacts include the National Packaging Covenant which uses a program based on individual companies developing tailored approaches to suit their circumstances and is supported by enforcement capability through the National Environment Protection (Used Packaging Materials) Measure (the NEPM)

2 Simple Benchmarks

21 Minimum Energy Performance Standards (MEPS)

Purpose

MEPS prescribe a minimum allowed energy performance for specific appliances Appliances that are less efficient than the relevant standard are excluded from the market

Background and Strategy

In October 1999 as part of the National Greenhouse Strategy (1998) nationally consistent MEPS and labelling schemes were adopted across Australia

Independent NATA accredited laboratories undertake product compliance checks to see whether products perform in compliance with MEPS requirements For example

bull In 2003 the government conducted check tests on eight appliance models all of which were found not to meet the claims made on the energy performance labels Two products were deregistered one was found to have not been registered and action was pending on the remaining five products (AGO 2003b)

55

bull Other regulatory actions undertaken in 2003 included fines of $3000 and $8000 against two Western Australian retailers who were found to have sold appliances without energy performance labels Queensland and Victorian retailers received infringement notices and fines totalling $10 000 (AGO 2003b)

Summary RegulNated minimum performance standards based on an Australian Standard

22 Energy Star

Purpose

An endorsement label that indicates an electronic product has achieved a specified standard when it is not performing its core function (ie on stand by)

Background and Strategy

Energy Star is a voluntary endorsement labelling program developed by the US Environmental Protection Agency (US EPA) It has been operating in the USA since 1992 and has been adopted by a number of countries including Australia Energy Star sets voluntary standards for reducing the electricity consumption of electronic equipment when it is not performing its core function

The Government stand ndash by program which is outlined below complements the energy star labelling program

Summary Voluntary endorsement label

23 Woodheater Standards

Purpose

To reduce particle emissions through Australian Standard compliant woodheaters

Background and Strategy

Since 1992 Australian StandardNew Zealand Standards have been introduced to improve the performance of wood heaters

The first standard for wood heater emissions AS4013 (1992) was published in 1992 and was revised and published as a joint AustralianNew Zealand Standard in 1999 ASNZS4013 (1999) Domestic solid fuel burning appliances - Method for determination of flue gas emission This Standard provides a test method to measure particles emitted by residential solid-fuel burning heating appliances

56

The 1992 Standard included an upper limit for acceptable particle emissions of 55 grams of particles per kilogram (oven-dry weight) of fuel burnt This emission factor was reduced to 4 gkg in the 1999 revision of the Standard The Standard applies to solid-fuel burning space-heating appliances (including those fitted with water heating devices) with a heat output of 25KW or less It does not apply to masonry fireplaces cooking stoves central heating appliances or water-heating-only appliances

AS 4013 (1999) is complemented by ASNZS4014 (1999) Domestic solid fuel burning appliances - Test Fuels and ASNZS4012 (1999) Domestic solid fuel burning appliances - Method for determination of power output and efficiency

The woodheater industry was instrumental in initiating the development of standards and it lobbied states and territories to enact legislation to mandating that woodheaters be required to meet the standards As the health affects of particle pollution have become more apparent and as some jurisdictions are having difficulty in meeting national particle standards Government has become more proactive in controlling woodheaters and more supportive of tighter standards

All states and territories with the exception of South Australia have regulations that restrict emissions from new woodheaters although Victoria for example only introduced its regulations in 2004 compared to Tasmania who introduced regulations in 1993 These regulations require that new woodheaters comply with the Australian Standard ASNZS 4013 The State regulations however are not uniform

Many woodheaters that are currently certified for sale do not comply with the revised standard as verified in a National Woodheater Audit Program undertaken in 2004 Seven of the 12 wood heaters tested failed to meet the ASNZS 4013 particle emission limit In addition 55 of heaters were found to have deviations from the original designs and 72 had labelling faults that could adversely affect emissions performance

Testing and certification are administered by the industry association

Summary State and regulations requiring compliance with Australian Standards Certification administered by industry association

24 Standby Power

Purpose

To reduce lsquoexcessiversquo energy consumed in electrical appliance standby mode sold in Australia through in the first instance voluntary targets Appliances covered by the program range from information technology equipment such as PCs and photocopiers entertainment equipment such as TVs DVDs and sound systems major appliances such as water heaters dishwashers and refrigerators and small appliances such as smoke detectors and bread makers

57

Background and Strategy

In 2000 standby power was estimated to constitute 116 per cent of Australiarsquos residential energy use costing households over $500 million and leading to the emission of over 5 million tonnes of carbon dioxide equivalent (AGO 2002c) Holt and Harrington (2004) estimated that standby power consumption in Australia could be reduced by 56 per cent by 2020 (Productivity Commission 2005)

In August 2000 all Australian jurisdictions agreed to pursue efficiencies in standby power consumption of energy-consuming products through support for the International Energy Agencys One -Watt program and endorse its incorporation into theprogram of work

Australia reportedly has taken the lead on implementing the One- Watt program even though many of the products sold in Australia are imported

During 2002 government agencies consulted with stakeholders about ideas to reduce standby The standby strategy which proposed a list of targeted potential product types was presented to the Ministerial Council on Energy

In September 2003 an interim test method for the measurement of standby power ASNZS 62301-2003 (int) based on an internationally recognised standard was published Also during this period work commenced on developing draft product profiles for high priority targeted products

Once product profiles are completed interim voluntary date-specific targets are made The product sales are then monitored to determine progress towards the interim target If it is then determined that inadequate progress is being achieved by a significant number of suppliers then government will regulate

For example the interim 2007 target for clothes washers is as follows

Product Off mode power End of program mode

lt 1W lt 4 W

The National Standby Strategy Target to be achieved by 2012 for clothes washers is as follows

Off mode power End of program mode lt 03 W lt 1 W

In support of the clothes washer program Government will

bull consider creating a Government Purchasing Policy to buy low standby clothes washers where available and fit for purpose

bull collect data on all modes for new clothes washers and analyse trends

bull highlight the range of performances by publishing performance data on clothes washers on a website or by other means

58

bull progressively include standby energy consumption into the Comparative Energy Consumption for labelled products such as clothes washers and clothes dryers

bull work with the Standards Committees to finalise the details of modes and test methods for the relevant standards

bull determine in 2008 if progress is inadequate and if regulation is required

Summary Industry targets possible future regulation

3 Tiered Benchmarks

31 Mandatory Energy Efficiency Label ndash the Energy Star Programs

Purpose

To enable consumers to easily compare the energy performance of electrical appliances used by households and firms through a labelling scheme

Background and Strategy

Several Australian states commenced mandatory energy efficiency labelling for major appliances in the mid-1980s In 1992 it became mandatory across Australia for initially refrigerators and later freezers clothes washers clothes dryers dishwashers and air-conditioners (single phase only) to carry the label when they are offered for sale This labelling program is regarded as one of the most successful in the world (Wilkenfeld and Assoc 2003) It is administered through the Australian Greenhouse Office

The energy rating label for dishwashers

(ldquoa joint government and industry programrdquo) and a website address (wwwenergyratinggovau) and has two main features

bull the star rating which gives a quick comparative assessment of the models energy efficiency and

bull the comparative energy consumption (usually kilowatt hoursyear) which provides an estimate of the annual energy consumption of the appliance based on the tested energy consumption and information about the typical use of the appliance in the home These values are measured under Australian Standards which define test procedures for measuring energy consumption and minimum energy performance criteria Appliances must meet these criteria before they can be granted an Energy Rating Label

The Energy Rating Label includes an endorsement

59

Awards Brand ModelInstallat

ionType

Phase Available

10 Yr Energy

Cost StarRating

Output(kW)

TOSHIBA

Digital Inverter Series Air

Conditioner RAV-SM1102BT-

ERAV-SP1102AT-E (

RAV-SM1102BT-ERAV-

SP1102AT-E)

SingleSplit

SystemDucted

Single $1500 1000

CHUNLAN

KFR-32GWVWa (

NO)

SingleSplit

SystemDucted

Single $645 323

Since its introduction the star rating label seems to have established a high level of recognition with consumers Consumer research (Artcraft 2003) indicates that the different information on the label appeals to different consumer segments interested in purchasing an appliance

When a manufacturer gains approval to use the label they pay for and produce the label in accordance with specifications on size colours fonts layout and design A similar colour scheme and design to the energy consumption label is also used for the compulsory fuel consumption label on new passenger and light commercial vehicles

The labelling scheme is underpinned by regulation whereby regulated Minimum Energy Performance Standards (MEPS) provide the environmental benchmarks that the appliances are required to meet Appliances that do not meet the minimum energy performance standards can be withdrawn from the Australian market

When the energy rating program was reviewed in 2000 technology had advanced to the point where a large percentage of appliances had achieved the maximum number of stars so the rating system was tightened It is estimated that over the 25 year period 1980 to 2005 there will have been an overall reduction in energy consumption of around 70 by the most popular sized refrigerators (with freezers) (Harrington L and Holt S 2002)

In addition to the energy consumption label there is a website (wwwenergyratinggovau) with a comprehensive database of all appliances their star rating and energy consumption In 2002 there were around 220000 hits on the programrsquos various websites and 523000 in 2003 reportedly representing 80000 visits by individual inquirers The website hit rate is estimated to represent almost 10 of consumers who are considering purchasing an appliance (Holt et al 2003)

Cooling

Energy Input (kW)

250

104

Figure B Excerpt from Energy Rating web page for Air Conditioners (cooling cycle only shown)

When the energy rating program was reviewed in 2000 technology had advanced to the point where the Scheme had to be tightened because a large percentage of appliances had achieved the maximum number of stars For example energy use by refrigerators was around 70 compared to that used when the scheme started (Harrington L and Holt S 2002)

60

Regulations

State and Territory legislation refer to the relevant Australian Standards This approach simplifies the State and Territory legislation and makes it relatively straightforward to maintain national consistency of appliance and equipment energy efficiency standards even when standards are continually being revised

The testing procedures and technical requirements for the label and also Minimum Energy Performance Standards (MEPS see below) are incorporated into the applicable Australian Standards Products for sale must be registered with one of the State regulators

Program Administration

The labelling program and MEPS program are administered by the National Appliance and Equipment Energy Efficiency Committee (NAEEEC) which is ultimately directed by the Ministerial Council on Energy

Requirements for Appliance Suppliers

Appliance suppliers are required to

bull Submit applications for product registration and these must include a test report or other data to demonstrate that the appliance meets the relevant Australian Standard

bull While test reports on three separate units are required for most products there is no particular requirement for test laboratories to be accredited or products certified for registration for energy labelling and MEPS in Australia Test reports from the manufacturers laboratory are satisfactory However if there is evidence that results from a particular laboratory are unsatisfactory regulators can mandate test reports from an accredited laboratory

Summary Mandatory labelling scheme backed by regulations and an Australian Standard

32 Water Appliances Water Efficiency Labelling and Standards (WELS) Scheme

Purpose

A labelling scheme backed by legislation to promote domestic water efficient appliances

Background and Strategy

A voluntary water efficiency industry administered labelling scheme has been in existence since 1988 The water efficiency ratings and details on the label design are covered in ASNZS 6400 The main incentive of the voluntary lsquoAAAAArsquo scheme

61

has been the publicity and cash rebates offered by water utilities However the coverage water efficiency performance requirements and impact of this program have been limited

In 2003 the Environment and Heritage Ministers agreed to implement a national Water Efficiency Labelling Scheme (WELS) for products such as shower heads washing machines dishwashers and toilets Consultation with industry and stakeholders was undertaken in 2003 with a strategic study published that identified the products to be included in the new labelling Scheme A Regulation Impact Statement (RIS) which identified the costs and benefits of various options and made various recommendations was published in March 2004 Following public review of the RIS some modifications were made to WELS

The WELS Scheme is backed by the following legislation and standard

Water Efficiency Labelling and Standards Act 2005 which establishes

bull the products subject to the Scheme and the requirements for registration and labelling

bull the standards to apply to WELS products setting requirements for water efficiency performance registration and labelling of these products

bull enforcement provisions including penalties bull the appointment of inspectors to investigate possible contraventions and sets

out their powers and obligations bull review and dispute resolution bull a program Regulator bull the making of regulations bull a requirement for annual reports and for an independent review after five years

Water Efficiency Labelling and Standards Regulations 2005 which

bull prescribes the circumstances in which a person other than the manufacturer of a WELS product may be taken to be the manufacturer of the product (eg an importer)

bull sets out procedures for the issuing and the payment of penalty infringement notices as an alternative to prosecution for offences against the WELS Act

bull specifying the information to be included on an identity card issued to a WELS inspector

Water Efficiency Labelling and Standards Determination 2005 amongst other things determines and establishes product registration fees and calls up the Australian Standard ASNZS6400 2005 Water-efficient products - Rating and labelling which

bull defines the products

bull specifies the assessment procedures (ie identifies test procedures in other Australian Standards)

bull provides the formulas to give products their star rating

bull specifies the labels and their application to products

62

Approximately twenty organisations were represented on the Standards Committee that developed the Standard

State and Territory legislation

The States and Territories have also enacted or agreed to enact complementary legislation to ensure that the WELS Scheme has comprehensive national coverage State and Territory legislation which is almost a mirror of the Commonwealthrsquos Water Efficiency Labelling and Standards Act 2005 enables the States and Territories to for example undertake certain responsibilities delegated to them by the Commonwealth Regulator appoint their own inspectors and enforce the WELS

Other features of WELS include

bull A product web database

bull With the exception of toilets no other products are required to meet mandatory water efficiency requirements (WES) but this may change over time The introduction of mandatory WES means that products not meeting the minimum performance requirements can not legally be sold

bull Products must be tested in accordance with the relevant Standard and must meet any minimum performance and water efficiency requirements in the Standard before they can be granted a WELS Water Rating label

bull It is up to manufacturers or their agents (eg importers in the case of imported products) to ensure that their products are correctly registered and labelled and comply with any other requirements of the Standard

There is a transition phase which gives manufacturers and importers time to test register and label products and to sell pre-existing stock From 1 January 2008 all products are required to display the WELS Water Rating labels irrespective of their date of supply

63

The WELS Water Rating label

Label Features

bull A star rating for a quick comparative assessment of the models water efficiency

bull Labels with 1 to 6 stars

bull Some products may also be labelled with a Zero Star Rated label which indicates that the product is either not water efficient or does not meet basic performance requirements

bull A productrsquos water consumption figure

bull There are provisions for swing tags if there is inadequate surface area for label or the item is likely to be marked by sticking the label on the product

Summary Mandated product labelling using lsquostarrsquo rating system Has a disendorsement label and has provisions to ban products

33 Gas Appliance Rating Scheme

Purpose

A gas labelling program to improve the energy efficiency of gas powered products

Background and Strategy

The Gas and Fuel Corporation of Victoria introduced energy labelling for gas water heaters in 1981 This scheme was taken over by the AGA in 1985 who in 1988 introduced a six star energy performance label This label was intended to be visually consistent with the star rating labels already familiar to consumers of electrical appliances

The labelling scheme is currently voluntary and still administered by the industry body

A range of gas appliances have been subject to minimum energy performance standards (MEPS) since the 1960s The current MEPS levels were set in 1983 and

64

Brand Model Type MjyearStar

RatingSRI

StorageCapacity

(ltrs)IndoorOutdoor

NaturalGas

Instantaneous 18969 59 I N

Instantaneous 18969 59 I N

lsquothe majority of models currently on the market appear to exceed current requirements by a comfortable marginrsquo (SEAV 2003 p 23)

The gas energy labels are similar in format to those found on electrical appliances except they are blue and show annual energy use in MJ

A trial web site listing gas water heaters available in Australia is also available (see below)

Bottle Gas

Rinnai Infinity

V Series

REU-V2632FFU-A (Infinity 26 plus internal) P

Rinnai Infinity

V Series

REU-V2632FFUC-A (HD2001 internal) P

A joint review of the scheme is under way by the Gas Industry and Governments and regulation is under consideration A three year work plan has been published under the Australian and New Zealand Appliance and Equipment Energy Efficiency Program

Summary Currently voluntary labelling using lsquostarrsquo rating system with mandatory minimum energy performance standards Future regulation is under consideration

34 Green Vehicle Guide

Purpose

To provide web-based comparable and accessible environmental data on new motor vehicles

Background and strategy

65

The Commonwealth government started publishing a booklet of fuel consumption data for new passenger and light commercial vehicles in the early 1980s and a low cost web database in more recent years

In 2004 the Government through the Department of Transport and Regional Services (DOTARS) expanded the fuel consumption guide into the Green Vehicle Guide The Green Vehicle Guide is a web based database that rates new passenger and light commercial vehicles on air pollution greenhouse emissions and fuel consumption and gives an overall lsquostarrsquo rating for each vehicle within each vehicle category (small medium luxury sports etc)

The data on which the scores are derived are provided voluntarily by the vehicle manufacturers however this data is based on mandatory Australian Design Rule certification test data

The Guide uses a 5 star rating system however it also assigns half stars resulting in a total of 10 levels

The Greenhouse Ratings are based on carbon dioxide emissions and the Air Pollution Ratings take into account the relative environmental impact of oxides of nitrogen hydrocarbons and particles The relative harmfulness of the pollutants (shown in table below) has been quantified based on the allowable concentrations under the Ambient Air Quality National Environment Protection Measure (NEPM)

Green Vehicle Guide Weighting of Regulated Vehicle Emissions

Vehicle Emission

(equivalent pollutant under Air NEPM)

Calculated

Relative

Harmfulness

Final

Weighting

Carbon Monoxide (CO) 0088 Not included

Oxides of Nitrogen (NOx) (based on

Nitrogen Dioxide)

4 1

Hydrocarbons (HC) (based on

photochemical oxidants as ozone)

5 1

Particulate Matter (PM) (based on PM10) 20 5

Source Real and Jones 2005

NOx and HC were given equal final weightings despite the slight difference in the calculated relative harmfulness primarily because under ADR7900 a combined HC+NOx limit is prescribed rather than individual limits for each pollutant

The higher weighting for particulate matter recognises its significant health impacts The Air Pollution rating scale was devised in such a way that a lsquotypicalrsquo car (that is most petrol engined passenger cars meeting the current emission standard at the time) receives a mid-point rating (5 out of 10)

66

The overall rating or stars is derived from the sum of the air pollution and greenhouse scores ie they are equally weighted

Development of the Green Vehicle Guide (see extract below) involved extensive consultation with vehicle manufacturers

Website Costs

The new highly automated web database which contains data on approximately 1400 vehicles and has sophisticated search facilities cost approximately $200000 to develop plus around $100000 was spent recently to improve the sitersquos usability This compares to the previous low cost database which together with the printed guide cost less than about $80000 per annum The low cost version lacked the automation was only updated annually and did not have the ability to compared vehicles

The manufacturers provide the data on line using special access codes This data is checked by DOTARS before it is uploaded onto the website It takes close to a full time position within DOTARS to administer the website and respond to website related queries

Market Research and Marketing

Before the new greenvehicleguidegovau website was launched DOTARS commissioned consumer surveys to determine the level of knowledge about the environmental impacts made by vehicles This research showed that around half of those surveyed had the belief that ldquoall new cars have the same level of impact on the environmentrdquo

It became apparent through the surveys that there was a need to provide consumers with meaningful information on the relative performance of different vehicles This was a view shared by the Productivity Commission who said that while markets provide extensive information to consumers regarding fuel consumption of motor vehicles ldquothe Australian Governmentrsquos Fuel Consumption Labelling Scheme and Green Vehicle Guide provide relatively low cost accessible and comparable information to consumers and may be justified as part of the more fundamental objective of encouraging consumers to reduce the adverse environmental impacts of motor vehicle userdquo The Productivity Commission also commented that government

67

sources of information of this type were seen as credible and reliable and held in higher regard than information provided by others

DOTARS has scheduled some follow up consumer research for 200062007

DOTARS has spent about $600000 in marketing the Green Vehicle Guide This has included advertising in weekend guides in newspapers developing facts sheets plus targeted marketing to motor vehicle journalists

Summary Website - voluntary but legislative base

4 Government-Industry Partnership programs

Government-Industry Partnerships are the basis of many environmental initiatives and can take a number of forms Industry and government negotiate the terms of the program which are normally detailed in a formal agreement which sets out the environmental objectives and the responsibilities of each party towards their achievement

The GovernmentIndustry Partnership programs outlined below indicate the varied nature of these initiatives

41 The National Packaging Covenant

The National Packaging Covenant (the Covenant) commenced in 1999 and is a voluntary agreement between all levels of government and companies throughout the packaging chain including raw material suppliers packaging producers and retailers The Covenant commits signatories to the implementation of best practice environmental management in areas such as packaging design production and distribution and research into life cycle issues Signatories to the Covenant produce action plans on the measures they will implement to reduce packaging waste and they report annually on their progress In this sense the Covenant provides flexibility to signatories to develop plans suitable to their own circumstances The Covenantrsquos success (it currently has over 600 signatories) is due to the active promotion of it by Government and key industry players

The Covenant is complemented by a regulation the National Environment Protection (Used Packaging Materials) Measure (the NEPM) which enables states and territories to use enforcement action to require companies that donrsquot sign the agreement to take steps to reduce their packaging waste Preceding the Covenant and the NEPM were a number of voluntary industry agreements but these were limited in scope and largely focused on companies in the beverage industry

42 National Industry Reduction Agreement

The Publishers National Environment Bureau (PNEB) was formed in 1990 as an association of the major publishers of newspapers and magazines in Australia to promote the recovery and recycling of old newspapers and old magazines primarily from community kerbside collections organised by local councils

68

The PNEB and a newsprint manufacturer have voluntarily entered into a series of five-year Industry Waste Reduction Agreements with the Commonwealth and State Governments Under the current (third) plan 2001-2005 newsprint recycling in Australia has grown to 754 nationally in 2005 from the 28 level when the PNEB was formed in 1990

43 StateLocal target based programs

There have been a number of agreements signed by state government departments and an industry group where there is a stated goal to reach a specific environmental target For example in the early 1990s there was a voluntary agreement with the EPA Victoria and companies in the Altona Chemical Complex in the western suburbs of Melbourne (which includes Australian Vinyls BASF Dow Chemicals and Qenos) to reduce hydrocarbon emissions by 50 within a specified timeframe The target was met and further emissions reductions were negotiated The NSW EPA-Oil industry petrol volatility agreement outlined below is another example of a target based program

44 NSW EPA-Oil Industry Memorandum of Understanding on Summer Petrol Volatility

In 1998 NSW established arrangements for the supply of low volatility petrol in summer in the Sydney Greater Metropolitan Region implemented through a Memorandum of Understanding between the then EPA and oil companies The principal reason for controlling petrol volatility in summer is to reduce evaporative emissions of VOCs (from vehicles and production and storage sites) which contribute to ozone formation

The Memorandum of Understanding operated over four summer periods from 1998 to 2002 and involved companies voluntarily reducing petrol volatility (measured in kilopascals (kPa) of vapour pressure) over three summer periods from a base of 76kPa to 70kPa in the first summer 67kPa in the second and 62 kPa in the last two years

Although the Memorandum of Understanding was successful in progressively reducing petrol volatility over the period of its operation it was not supported by all industry members Consequently agreement was reached with industry that summer petrol volatility limits should be regulated to ensure a level playing field for all industry participants and regulated limits will apply from the summer of 200405

69

5 Summary of Australian Benchmark Programs

Program National State

Summary of Approach Impact

Voluntary Programs Altona Chemical Complex (Vic)

Local Small industry group worked towards self determined targets

Very high

Energy Star National Standards based label Limited Gas appliance Rating Scheme

National Industry operated labelling scheme with stars assigned therefore has graded benchmarksminimum performance standards out dated web database being developed

Low

National Industry Reduction Agreement

National Small industry group worked towards negotiated targets

High

NSW EPA-Oil Industry MOU

State Small industry group worked towards negotiated targets but not all involved ndash lead to regulations

Moderate

Top Energy Saver Award

National Achievement based label Limited

Quasi Regulatory Green Vehicle Guide

National Well promoted web database star ratings assigned therefore has graded benchmarks data provided voluntarily but backed by ADR requirements

High

Stand-by power National Required to achieve voluntary targets or regulation will be introduced

Unknown

National Packaging Covent

National Performance based targets backed by legislation High

Regulatory Energy Efficiency Labels

National Labelling scheme with stars assigned therefore has graded benchmarksbased on Australian Standard web database

High

MEPS National Sets base benchmark and works with energy rating

High

WELS Scheme National Labelling scheme with stars assigned therefore has graded benchmarksbased on Australian Standardweb database

High

Wood heaters State Only one benchmark assigned regulations are not uniform

Moderate

authorrsquos assessment based on direct or indirect knowledge of these programs

70

Appendix 3 Productivity Commission Comments on Labelling and Minimum Performance Standards

The Productivity Commission an independent agency which is the Australian Governmentrsquos principal review and advisory body on microeconomic policy and regulation recently examined the cost effectiveness of improving energy efficiency As part of its review lsquoThe Private Cost Effectiveness of Improving Energy Efficiencyrsquo it examined labelling programs minimum mandatory energy efficiency requirements and other means of providing consumer information The final report contains some highly relevant material that is applicable to establishing a benchmarking scheme for small engines

The following is a summary of relevant conclusions from the Inquiry

Government Operated Labelling Schemes

From consumer research provided to the Commission it concluded that ldquothere is some evidence to suggest that consumers are now paying more attention to labels than they have in the pastrdquo

The Commission was positive about labelling programs as labels

bull directly address ldquoa source of market failure mdash the asymmetry of information between buyers and sellers of energy-using productsrdquo

bull provide information to the consumer that is readily-accessible and easily-understood and therefore can assist in helping the consumer make better-informed choices

bull are likely to have produced net benefits for consumers

bull do not directly limit consumer choice

bull could provide a greater incentive for suppliers to sell products that use energy cost effectively

bull probably produced net social benefits

bull are most suited where there is a wide spread in the range of performances of comparable appliances and where information failures are most pronouncedrdquo

bull can be used to warn consumers that an appliance is very inefficient (through a disendorsement label) which could be effective in discouraging but not preventing consumers from buying the poor performing product

The Commission was supportive of Governmentrsquos role of drawing together and packaging information through labelling programs as this ensures that ldquorelevant and trusted information gets to those who would otherwise not get itrdquo In material reviewed by the Commission George Wilkenfeld and Associates and Energy Efficient Strategies (1999) claimed that labelling is unlikely to be effective if purchasers rarely inspect appliances in a showroom where they can compare performance across

71

different models or the purchaser is not the ultimate user and so has little interest in operating costs

Labelling programs involves both administration and compliance costs such as those incurred by suppliers in having their products tested but the Commission considered that labels should be more actively considered as an alternative to minimum performance standards

Minimum Performance Standards

Governments can prevent the sale of inefficient products by using minimum standards for example the Minimum Energy Performance Standards (MEPS) that apply to appliances such as refrigerators and freezers air conditioners and electric water heaters If appliances do not meet the minimum standard they cannot be sold in Australia Some appliances are covered by both MEPS and by labelling (for example refrigerators)

The Commission considered that MEPS and labels can be complementary as MEPS act to penalise the worst energy performers whereas labels rewarding the better performers

Costs comparisons of schemes

The Department of the Environment and Water Resources provided details about the costs involved in administering both the labelling scheme and the minimum performance standards for energy programs It stated that

bull the administration costs of MEPS are substantially lower than for labelling but the compliance costs can be higher

bull MEPS can have a greater cost for suppliers than labelling since suppliers must adjust their model ranges to meet the MEPS levels by the given date These compliance costs are however influenced by the lsquolead inrsquo time between the introduction of the regulatory proposal and the implementation of the MEPS

bull it is estimated that the administration costs for MEPS would be $3 million over the period 2000ndash15 compared to $39 million for labelling (in present value terms) (George Wilkenfeld and Associates and Energy Efficient Strategies 1999) Furthermore it was assumed that 84 per cent of administration costs were borne by appliance purchasers with the remainder borne by governments

It estimated that MEPS would increase the cost of appliances by $266 million over 2000ndash15 compared to $688 million for labelling (the latter cost being due to consumers voluntarily purchasing more efficient appliances)

72

Page 7: Outdoor Garden Equipment - Department of the Environment

Executive Summary

Background

This report sets out the results of a project to compare and benchmark emissions from small petrol engines (less than 19 kilowatts) that are used to power outdoor garden equipment and were available for sale in Australia during 2006 The equipment powered by these small engines are used in lawnmowers brushcutters hedge trimmers and the like

These engines emit volatile organic compounds (VOCs) and oxides of nitrogen (NOx) which contribute to ozone (photochemical smog) formation in summer They also emit particles carbon monoxide (CO) and a range of air toxics such as benzene

Sydneyrsquos Greater Metropolitan Region (GMR) annually records exceedances of the National Environment Protection (Ambient Air Quality) Measure (Air NEPM) ozone standards The other jurisdictions meet or are close to meeting the current ozone standards

The Air NEPM standards are being reviewed and based on current human health evidence the argument appears to be strengthening for tighter ozone standards Should a stricter standard or an eight-hour standard consistent with international standardsguidelines be adopted achievability of Air NEPM ozone standards or goals could become an issue for some of the other major urban airsheds

The United States California Canada and Europe regulate emissions from outdoor equipment - the USA has had these in place since 1997 There are no Australian regulations or standards that limit air pollutant emissions from engines used in outdoor garden equipment however as the majority of equipment sold in Australia is imported some do comply with emission standards applicable to the country of origin

Small engines are not as advanced in environmental terms as motor vehicle engines As a result even the better-performing small engines emit far greater quantities of pollutants per hour than typical modern car engines For example the US Environmental Protection Agency (USEPA) 2002 limit for a typical 4 kilowatt (kW) lawnmower motor is about 66 grams (g) of regulated pollutants per hour of operation A typical 08kW brushcutter sold new in 2002 emitted about 160grams of pollutants per hour - reducing to 40grams per hour if bought new in 2006 The equivalent limit for cars under Australian Design Rule 79 is about 16g per hour In other words one hour of operation of a brushcutter that meets USEPA 2002 limits produces the same pollution as ten cars operated over a similar time These comparisons are subject to differences in test methods but they do provide an indication of the disproportionate amount of pollution emitted by small engines

Engines that do not comply with current USEPA requirements are likely to emit several times the amount of pollution calculated in the above example Therefore the worst performing engines are likely to emit more than ten times the emissions of the best performers

iii

Based on estimates made using the National Pollutant Inventory database engines used in lawn mowers contribute approximately 4 on average to VOC emissions from anthropogenic sources in major airsheds in Australia when public open space lawn mowing is included This is likely to rise to around 11 in the warmer spring and autumn weekends which is when lawns and other vegetation grows faster and when gardening is more popular The NPI does not take into account emissions from other types of powered outdoor equipment

The Australian Market

According to the Outdoor Power Equipment Association (OPEA) approximately 424000 walk behind lawnmowers and more than 792000 units of outdoor handheld equipment were sold in Australia in 2005-06 In addition there were sales of about 80000 replacement engines and 70000 pumps in 2005-06 most of which were four strokes The general household consumer represents the major market segment for garden equipment accounting for up to 90 of product sales with commercial garden services and government purchasing the rest

Indications are that sales of imported high polluting two stroke engines have increased over the last few years and it appears that the price of some powered garden equipment has dropped to the level where consumers regard them as disposables

An assessment of outdoor equipment on the Australian market found that the majority of small engines sold in Australia are imported and many come from countries that impose emission limits The extent of imports into Australia that do not comply with the country of origin standards is not known However the industry estimate that 40 of garden products are sold through importers who are not linked to manufacturers of US EPA or European certified equipment and the source of some products sold here is difficult to establish Victa is the only company producing small engines in Australia Its iconic 2-stroke lawn mower engine currently does not meet overseas emission limits for non-handheld equipment and Victa is undertaking research and development to reduce emissions from its two stroke engine to meet US and European standards

In spite of several attempts to obtain data on compliance with overseas emission standards from Australian distributors their response was poor The following figure therefore provides a best estimate of expected compliance of outdoor equipment on the Australian market with European CARB or USEPA requirements applicable in 2004

iv

Figure E1 Compliance with overseas standards for popular categories ldquoPhase 1 equivrdquo means the engine complies with US EPA phase 1 or 200288EU ldquoPhase 2 equivrdquo means the engine complies with US EPA Phase 2 Euro I or Euro 2 ldquoUnknown means that engine cycle (stroke) was not provided

Measures to Increase Sales of Low Emission Garden Equipment Engines

There is a range of options that could be considered for reducing emissions from engines used in outdoor garden equipment engines in Australia These include

1 Maintaining the Status Quo

2 Government ndash Industry Partnership Program

3 Quasi regulation

4 Co-regulation

5 Regulations based on either a simple benchmark or tiered benchmarks

The Small Engine Expert Panel ndashOutdoor Equipment has considered in depth the most appropriate approach to take to improve the emissions performance of outdoor garden equipment sold in Australia It recommends the introduction of national regulations to control the emissions from outdoor garden equipment particularly in light of the increase in cheap imports onto the Australian market which although untested are considered very likely to have high emission levels The Expert Panel has developed some broad recommendation on which Australian regulations could be based which takes in consideration the local market and Victa These are summarised as follows

1 Mandatory air pollutant emission standards to be introduced in Australia for all outdoor equipment (lt19kW) powered by spark-ignition engines

v

The development of any regulation would need to be based on a formal assessment of the costs and benefits of nationally regulating two and four stroke lawn mowers and handheld power equipment which should commence immediately

2 Proposed standards to mirror US EPA regulations (compliance with equivalent EU regulations also acceptable)

3 Timing (subject to completion of assessment of costs and benefits)

(a) US EPA Phase 1 ndash Effective from 20072008

(b) US EPA Phase 2 ndash Fully implemented in 2012 (in step with 2007 USEPA limits) plus a phase-in period andor provisions for averaging banking and trading (ABT) of emissions over 2008-2012 to provide for early introduction of cleaner product

The US EPA Phase 1 and Phase two emissions limits are given in the table below

4 Walk-behind two stroke mowers to be included in US EPA Category 5 (gt50cc) product classifications (to provide Victa time to develop a cleaner engine) Implementation timing is proposed to be the same as Recommendation 3 above

5 All products also to be certified to relevant EPA product durability categories

6 Subject to further review ABT if included may be phased out after 2012

Table E1 Comparison between the USA Phase 1 and Phase 2 standards

Emission Limits GkW-hr

Phase 1 (1997 ndash2001) Phase 2 (2007) HC NOx HC+NOx CO HC+NOx CO

Non-handheld

I-A lt66cc 161 161 610

I-B 66-lt100cc 161 161 610

I 100-225 cm3 161 519 161 610

II 225 cm3 134 519 121 610

Handheld

III lt20 cm3 295 536 805 50 805

IV 20-50 cm3 241 536 805 50 805

V 50 cm3 161 536 603 72 603 Phase 2 limits were phased in between 2002 -2007 during which time they became tighter

For simplicity only the 2007 are shown in this table (see Table 2 for more details)

vi

Conclusion

From this review it is apparent that it is highly unlikely that the companies in the industry would engage in or commit to any voluntary type program It is therefore clear that the most expedient path to reduce emissions from these small engines is through national regulation State based regulations could only provide a piecemeal approach that would lead to product dumping in states where there are no regulations and inconsistent regulations that require industry to treat each state market differently In addition enforcement of any state based regulations would be a key problem due to existing Commonwealth and State Government mutual recognition legislation

While any national regulation of emissions from small engines used in garden equipment in Australia are likely to be based on overseas regulations they need to strike a balance between improved environmental outcome harmonisation with international standards and the characteristics of the local industry With regulations optimum emissions reduction are potentially achievable by combining minimum emissions standards with tiered product labelling Whether this approach is justifiable on economic grounds that is the benefits outweigh the costs can only be determined through a detailed impact assessment Based on these findings it is recommended that a formal assessment of the costs and benefits of nationally regulating two and four stroke lawn mowers and handheld power equipment should be commenced

vii

1 Introduction

This report sets out the results of a project to compare and benchmark emissions from engines used in outdoor garden equipment that were available for sale in Australia during 2006 Possible outcomes from the project range from consumer guidelines for selecting low emission engines to regulatory controls on emissions There are currently no state or national regulations that directly control emissions from these engines

The project was commissioned by the Commonwealth Department of the Environment and Water Resources on behalf of state and territory government departments working on reducing the impacts of small engine emissions This report was prepared in consultation with an Expert Panel that included representatives from the Outdoor Power Equipment Association (OPEA)

11 Emissions from outdoor garden equipment engines

Small engines particularly conventional two stroke engines used in applications such as outdoor garden equipment are high polluters relative to their engine size and usage1 These small engines emit volatile organic compounds (VOCs) and oxides of nitrogen (NOx) which contribute to ozone (photochemical smog) formation in summer They also emit particles carbon monoxide (CO) and a range of air toxics such as benzene The USA California Canada and Europe and regulate emissions of VOCs NOx carbon monoxide and particle emissions from outdoor garden equipment

There are five types of spark-ignition engines that can be used in outdoor garden equipment

bull two stroke with carburettor (2c)

bull two stroke with pre-chamber fuel injection (2i)

bull two stroke with direct fuel injection (2di)

bull four stroke with carburettor (4c)

bull four stroke with fuel injection (4i) (includes direct injection)

Carburettor and pre-chamber fuel injection two stroke engines are inherently more polluting than the other three types This is due to their inability to completely separate the inlet gases from the exhaust gases resulting in up to 30 of the fuel being left unburnt and the need to add oil to the fuel to lubricate the engine (four stroke engines have separate reservoirs for fuel and oil) However twostroke carburettor engines typically weigh less than a four stroke engine of the same power and this tends to make them attractive for handheld equipment They also tend to have fewer components are generally cheaper to purchase and are cheaper to maintain than

1 Outdoor equipment covered in this report are engines less than 19kW

1

four stroke motors Victa Lawncare is currently undertaking research and development to improve the environmental performance of two stroke carburettors and while some emission improvements have been made a two stroke compliant with US or European standards is still considered several years away

Four stroke carburettor engines are generally quieter more fuel efficient and are less polluting than conventional two stroke engines

Direct fuel injection (dfi) either two stroke or four stroke overcomes the unburnt fuel problem and can meet the stringent regulated exhaust emission limits that apply overseas However there is not any evidence that dfi engines are being used in outdoor garden equipment available in Australia It appears that engines used in outdoor garden equipment in Australia are generally restricted to two and four stroke carburettor engines

Small engines are not as advanced in environmental terms as motor vehicle engines As a result even the better-performing small engines emit far greater quantities of pollutants per hour than typical modern car engines For example the US Environmental Protection Agency (USEPA) 2002 limit for a typical 4 kilowatt (kW) lawnmower motor is about 66 grams (g) of regulated pollutants per hour of operation A typical 08kW brushcutter sold new in 2002 emitted about 160grams of pollutants per hour - reducing to 40grams per hour if bought new in 2006 The equivalent limit for cars under Australian Design Rule 79 is about 16g per hour In other words operated over a similar time one hour of operation of a brushcutter that meets USEPA 2002 limits produces the same pollution as ten cars and a 4kW lawnmower the same pollution as four cars These comparisons are subject to differences in test methods but they do provide an indication of the disproportionate amount of pollution emitted by small engines

Engines that do not comply with current USEPA requirements are likely to emit several times the amount of pollution calculated in the above example Therefore the worst performing engines are likely to emit some ten times the emissions of the best performers

Because of the combustion of oil these engines also emit high levels of particles Although small engines only contribute a small amount to total particle emissions the rate of particle release compared to other engines can be very high For example lawnmowers can emit over 10 times more particles (in terms of grams per hour) than a petrol motor vehicle (manufactured between 1994 and 2001)

All the above emission comparisons between outdoor garden equipment engines and motor vehicles are subject to differences in test methods but they indicate the disproportionate amount of pollution emitted by small garden equipment engines It also needs to be recognised that motor vehicles in Australia average more than 15000 kilometres per year (ABS 2003) while the annual average use of outdoor garden equipment is around 25 hours for a lawnmower and less for other types of equipment Commercial operators however are likely to have a much higher usage rates than the general public

2

This paper examines the Australian market for small engines used in lawnmowers and handheld garden equipment their impact on air quality relevant overseas regulations and their applicability to Australia and makes recommendations to reduce air quality impacts from these engines

A wide range of information sources has been referenced for this report including data and information supplied by manufacturers distributors and dealers in small engines

3

2 Air Quality and Outdoor Garden Equipment Engines

Emission inventories make estimates of emissions of substances from a multitude of sources into airsheds The National Pollutant Inventory (NPI) which is run cooperatively by the Australian state and territory governments contains data on 90 substances that are emitted to the Australian environment The substances included in the NPI have been identified as important because of their possible health and environmental effects Industry facilities estimate their own emissions annually and report to states and territories Non-industry (or diffuse) emissions estimates which includes emissions from outdoor garden equipment are made by the states and territories on a periodic basis using information sources such as surveys databases and sales figures

The NPI only reports emissions from domestic lawn mowing and for a few airsheds the contribution made by public open space lawn mowing It does not report on the contribution made by other types of outdoor garden equipment such as brushcutters National and selected state NPI emissions estimates for the common air pollutants and for Air Toxics NEPM pollutants from domestic lawn mowing are summarised in Table 1 It should be noted that national emissions from lawn mowing are underestimates as the NPI records emissions for major airsheds only and therefore is not Australia wide plus the estimates do not include evaporative emissions from fuel tanks and hoses

This NPI data is indicative only as the accuracy and completeness of the data sets varies across airsheds and is reliant on the estimation techniques used For example while the population in the NSW is higher than other airsheds its emissions look disproportionally high when compared to the other airsheds This could be because the estimation technique varies or it is due to some other factor

4

Table 1 National Pollutant Inventory Domestic Lawn Mowing Emission Estimates

Substance Port Phillip

Population 34 mill (1996)

SE Qld

Population 23 mill

NSW GMR

Population 47 mill

Adelaide

Population 10 mill

National

Common Air Pollutants (tonnesyear)

Carbon monoxide 12000 12000 24000 6100 69000

Total Volatile Organic Compounds 3600 3800 7000 2000 21000

Particulate Matter 100 um 86 94 170 9 460

Sulphur dioxide 5 5 9 50 81

Oxides of Nitrogen 63 54 120 24 330

Air Toxics (tonnesyear)

Benzene 230 210 390 130 1200

Formaldehyde 56 38 NA 31 180

Polycyclic aromatic hydrocarbons 07 11 21 04 41

Toluene (methylbenzene) 370 360 660 210 2000

Xylenes (individual or mixed isomers) 270 260 490 150 1500

Analysis of the NPI database at the national level shows that domestic lawn mowing is the

- Fourth largest source of benzene contributing 7 to the total reported airshed load

- Fourth largest source of formaldehyde contributing 3 to the total reported airshed load

- Fifth largest source of xylene contributing 6 to the total reported airshed load

- Fifth largest source of toluene contributing 6 to the total reported airshed load

- Sixth largest source of carbon monoxide contributing 12 to the total reported airshed load

- Ninth largest source of VOCs contributing 3 to the total reported airshed load when biogenics (natural sources such as trees and soil) are excluded

The NSW Department of Environment and Conservation has been upgrading its emissions inventory Based on 2003 emissions data non-road anthropogenic sources

5

contribute 619 of the VOCs to the GMR airshed Preliminary results2 indicate that VOC emissions from domestic and public open space lawn mowing contributes on an annual average 41 of all VOC emissions in the GMR On a typical weekend during warmer weather this percentage rises to 11

Therefore it could be assumed that lawn mowing could contribute approximately 4 on average to VOC emissions from anthropogenic sources in major airsheds in Australia when public open space lawn mowing is included This percentage is likely to rise significantly in the warmer spring and autumn weekends which is when lawns and other vegetation grow faster and when more people garden

21 Air Quality Standards

In June 1998 the National Environment Protection Measure for Ambient Air (Air NEPM) established national uniform standards for ambient air quality for the six most common air pollutants ndash carbon monoxide nitrogen dioxide photochemical oxidants (measured as ozone) sulfur dioxide lead and particles less than 10 microns (PM10) The NEPM was varied in 2003 to include PM25 advisory reporting standards and in April 2004 a National Environment Protection Measure for Air Toxics was adopted

Nationally the common pollutants of most concern (particularly in major urban areas) are fine particles and ground level photochemical smog (measured as ozone) which is formed in the warmer months when volatile organic compounds (VOCs) and oxides of nitrogen (NOx) react in the atmosphere under the influence of sunlight in a series of chemical reactions

Recent health studies (cited in NEPC 2005) have strengthened the evidence that there are short-term ozone effects on mortality and respiratory disease The studies also strengthen the view that there does not appear to be a threshold for ozone below which no effects on health are expected to occur In recent years Australian epidemiological studies have been conducted which confirm the results of overseas studies that there is a relationship between elevated ozone levels and hospitalisations and deaths from certain conditions

There are two national ozone standards a one hour standard of 010ppm and a four hour standard of 008ppm with a goal that allows for one exceedance per year by 2008 Sydney experiences a number of days each year of ozone levels above these standards In 2003 Sydney exceeded the one hour standard on 11 days in 2003 19 days in 2004 and 9 days in 2005 The four hour standard was exceeded on 13 days in 2003 19 days in 2004 and 13 days in 2005 Further reductions in VOC and NOx emissions are needed to reduce ozone concentrations in Sydney to levels that would comply with the Air NEPM

The other jurisdictions meet or are close to meeting the current National Environment Protection (Ambient Air Quality) Measure (Air NEPM) ozone standards (NEPC 2005) However the ozone standards are being reviewed and based on current human health evidence the argument appears to be strengthening for tighter ozone standards

2 Presentation to Expert Panel 27 April 2006 by Nick Agipades Manager Major Air Projects NSW DEC

6

Should a stricter standard or an eight-hour standard consistent with international standardsguidelines be adopted achievability of Air NEPM ozone standards or goals could become an issue for some of the other major urban airsheds (NEPC 2005)

Modeling of ozone for Sydneyrsquos Greater Metropolitan Region (GMR) indicates that the implementation of Euro emission limits for on-road vehicles and hence the increased presence of these less polluting vehicles in the fleet and retirement of old more polluting vehicles from the fleet is not sufficient to meet the current NEPM goals Modeling suggests that very large reductions in precursor emissions would be required to meet the current ozone one hour goal (NEPC 2005)

Even when the effects of bushfires and when hazard reduction burning are taken into consideration airsheds such as Launceston Melbourne and Sydney struggle to meet the national standards for particles (EPA 2006) However outdoor powered equipment predominantly from two stroke engines makes only a minor contribution to ambient fine particle loads

While carbon monoxide emissions from engines used in outdoor garden equipment are regulated overseas air monitoring in Australia indicates that carbon monoxides levels are well below the national air quality standards and there are no pressing issues requiring CO from outdoor powered equipment to be regulated In addition data indicates that lowering emissions of VOCs and NOx from small engines reduces CO emissions

Many of the pollutant sources which contribute to the formation of ozone and to particle levels also contain air toxics such as benzene toluene formaldehyde and xylenes These air toxics have been shown to be responsible for a range of health problems including asthma respiratory illnesses and cancer The National Environment Protection Measure for Air Toxics requires each jurisdiction to monitor and report annually on five air toxics benzene polycyclic aromatic hydrocarbons formaldehyde toluene and xylenes The monitoring data is intended to inform future policy and also the public on ambient levels of these air pollutants Monitoring of air toxics to date shows that levels are low and below the national monitoring investigation levels (EPA Vic 2006 DEC 2006)

7

3 Emission Standards for Small Engines

31 Australia

At present there are no Australian regulations or standards to limit air pollutant emissions from small (two and four stroke) engines Australia does benefit to some extent from overseas regulations as many lawnmowers and other gardening equipment sold in Australia have engines manufactured in the United States or Europe where strict standards apply

32 United States

In the United States emission regulations set by the United States Environmental Protection Agency (USEPA) and the Californian Air Resources Board (CARB) apply to lawn mowers and other powered gardening equipment Although CARB standards currently tend to be stricter than USEPA standards by 2006 emissions limits applying under the two standards will be very similar

United States Environment Protection Agency (US EPA)

In 1995 the USEPA introduced ldquoPhase 1rdquo regulations covering small non-road engines with a power of not more than 19kW (25HP) The regulations applied to equipment manufactured from 1997

These regulations have seven classes of equipment based on portability and engine displacement volume (ldquocapacityrdquo) In March 2000 the USEPA published ldquoPhase 2rdquo regulations which are shown in Table 2 These set limits for combined emissions of hydrocarbons (HC) and oxides of nitrogen (NOx) and separate limits for carbon monoxide (CO) emissions and for two stroke engines only particles

Table 2 US EPA Phase 2 Small Engine Emissions Standards (HC+NOx in gkW-hr) (a) (b)

Small Engine Class

Type 2002 2003 2004 2005 2006 2007+

I-A (lt66cc) Non-handheld (eg lawnmowers)

- 161 161 161 161 161

I-B (66 to lt 100cc) - 161 161 161 161 161

I (100 to lt 225cc) - 161 161 161 161 161

II (225cc or more) 180 166 150 136 121 121

III (lt20cc) Handheld (eg trimmers)

238 175 113 50 50 50

IV (20 to lt50cc) 196 148 99 50 50 50

V (50cc or more) - - 143 119 96 72 (a) As carbon monoxide (CO) levels in Australia are well below the Air NEPM standard the

USEPA emission limits for CO have not been included in this table (b) Includes useful life criteria of 50125300 hours

8

When the USEPA introduced ldquoPhase 2rdquo regulations it included averaging banking and trading provisions (ABT) which were seen ldquoas an important element in making stringent Phase 2 emissions standards achievable with regard to technological feasibility lead time and costrdquo (USA 1999) The USEPA also claimed (USA 2000) that the ABT program secures early emissions benefits through the early introduction of cleaner engines

ABT provisions which apply to handheld and non handheld engines are complex but in broad terms averaging means the exchange of emission credits among engine families within a given engine manufacturerrsquos product line This allows a manufacturer to produce some engines that exceed the standards and offsetting these exceedances with emissions from engines that are below the standard Manufacturers are allowed to exchange credits from handheld to non handheld and vice versa Banking means the retention of emission credits by the engine manufacturer generating the credits for use in a future model year (for averaging or trading) Trading is the exchange of emission credits between engine manufacturers which then can be used for averaging purposes banked for future use or traded to another engine manufacturer

In January 2004 USEPA reported that in 2002 averaging was being used but there was very little use of banking It determined that the initial ABT programs as too complex and included discount rates on credits ABT was simplified in 2004 including the elimination of credit discount and multipliers and limits on credit life To date there has reportedly been limited use of banking however it is anticipated that there will be more widespread use of banking credits if the USEPA proposed Phase 3 comes into effect3 (see below)

Particulate limits (2gkW-hr) also apply to two stroke engines Carbon monoxide and durability limits (or useful life) are also prescribed The durability criteria which were introduced in Phase 2 require that the emission limits must be met through the useful life of the engine The manufacturer determines useful life of each product using standardised product testing procedures and then based on the test results selects the useful life category for each product which can be 125 250 or 500 hours These durability criteria acknowledge the large disparity in usage patterns by equipment type and between commercial and residential users It also takes into account the ability of manufacturers to design and build engines for various design lives and which fit the types of equipment engine is produced for

The March 2000 USEPA report (USEPA 2000) estimated that the expected effects of the Phase 2 regulations would be

bull A 70 reduction in HC+NOx beyond the Phase I standards (which were estimated to have reduced emissions by 32 from the unregulated baseline)

bull A 30 reduction in fuel consumption of small handheld equipment bull Price increases of between $US23 (Class III) and $US56 (Class V) for

handheld equipment

3 Dave Gardner Briggs and Stratton email 22506

9

The US EPA is currently considering lsquoPhase 3rsquo regulations which are catalyst based standards to further reduce exhaust HC and NOx emissions from non handheld engines reduce evaporative HC and NOx emissions for both handheld and non handheld engines plus include extended durability criteria These limits are currently at discussion stage only They align with CARB Tier 3 but a longer lead time is proposed

Table 3 Proposed Phase 3 Exhaust Emissions

HC+NOx gkW-hr

CO gkW-hr

Year Useful life hrs

Class I 100 610 2010 125250500

Class II 80 610 2011 2505001000

Class III-V No changes

HC+NOx std is based on averaging

Californian Air Resources Board (CARB)

Spark ignition engines

CARB regulations first introduced emission limits for small engines manufactured from1995 The more recent schedule of emission limits are shown in Table 4 These limits depend solely on the engine capacity and apply to both handheld and non handheld classes

Table 4 CARB Emission Limits for Small Engines (HC+NOx in gkw-hr)

Engine Capacity 2000-2001 2002-2005 2006+

65cc or less 72 72 72

gt65cc to 225cc 161 161 161

gt225cc 134 121 121

California has particle limits for two strokes useful life criteria and mandatory engine labeling including a consumer advisory hang tag as shown in Figure 1 The USEPA is also considering introducing an air index label

10

Figure 1 Example of a Californian Consumer Advisory Hang Tag The Californian regulations take into account sales weighted emission performance for families of engines An engine family is essentially the same engine being used in different equipment items

In 2003 California adopted a Tier 3 program for exhaust and evaporative emissions and these are based on the use of catalytic convertors The engine classes better align with US EPA categories however the exhaust standards for Class I and Class II are more stringent than the existing US EPA standards

Table 5 CARB Tier 3 for Exhaust Emissions

Model Year Displacement Category

Durability Periods (hours)

HC+NOx gkw-hr

CO gkw-hr

Particulate gkw-hr

2005 and subsequent

lt50 cc 50125300 50 536 20 + 50-80 cc inclusive 50125300 72 536 20 +

2005 gt80 cc - lt225 cc Horizontal-shaft eng

125250500 161 549

gt80 cc - lt225 cc NA 161 467 Vertical-shaft Engine 225 cc 125250500 121 549

2006 gt80 cc - lt225 cc 125250500 161 549 225 cc 125250500 121 549

2007 gt80 cc - lt225 cc 125250500 100 549 225 cc 125250500 121 549

2008 and subsequent

gt80 cc - lt225 cc 125250500 100 549 225 cc 1252505001000 80 549

the 1000 hours is applicable for 2008+ Model Year (MY) + applies to 2 stroke only Source California Exhaust Emission Standards and Test Procedures For 2005 And Later Small Off-Road Engines Adopted July 26 2004 effective on October 20 2004

California also has Blue Sky provisions These are voluntary standards for engines that meet the criteria shown in Table 6 Blue Sky Series engines are not included in

11

the averaging banking and trading program Zero-emission small off-road equipment (eg push mowers) may certify to the Blue Sky Series emission standards

In 2005 CARB aligned its test procedures with the USEPA

Table 6 CARB Blue Sky Provisions

Model Year Displacement Category

HC+NOx gkw-hr

CO gkw-hr

Particulate

2005 and subsequent lt50 cc 25 536 20

50 - 80 cc inclusive 36 536 20

2007 and subsequent gt80 cc - lt225 cc 50 549

2008 and subsequent 225 cc 40 549 Applicable to all two stroke engines

33 Canada

The Canadian small engine market has similarities to the Australia market the majority of small engines are imported from the USA and there is one Canadian manufacturer of small spark ignition engines and one major manufacturer of lawn and garden machines

A Memorandum of Understanding (MOU) which came into effect on 1 January 2000 was signed between Environment Canada and ten manufacturers of handheld equipment and nine manufacturers of engines used in non handheld machines The MOU was intended as an interim measure until regulations could be put in place Under the MOU the manufacturers agreed to voluntarily supply small spark ignition engines designed to meet the applicable USEPA Phase 1 emission standards

In 2003 Canada regulated emission limits for handheld and non-handheld small engines based on USEPA emission limits The regulations apply to model years 2005 and later While there are no separate averaging banking and trading provisions in Canadian regulations Canada allows any USEPA certified engine to be sold in Canada This means that engines that do not meet the standard level but are averaged (or use credits) in the United States can be sold in Canada Manufacturers are required to produce upon request evidence of conformity to the standards and are required to provide written instructions on engine maintenance to the first retailer

12

Table 7 Canadian Small Spark-Ignition Engine Exhaust Emission Standards

Engine class

Engine Type

Engine Displacement (cm3)

Effective date (model year)

Standard HC+NOx (gkWshyhr)

Standard NMHC+NOx (gkW-hr)

Standard CO (gkWshyhr)

I-A Non-handheld lt66 2005 and

later 50a -shy 610a

I-B Non-handheld

lt100 and 66

2005 and later

40a 37a 610a

I Non-handheld

lt225 and 100

2005r 161b 148a 519b 610a

II Non-handheld 225 2005 and

later 121a 113a 610a

III Handheld 20 2005 and later 50a -shy 805a

IV Handheld lt50 and 20 2005 and later

50a -shy 805a

V Handheld 50 2005 2006 2007 and later

119a 96a

72a

-shy-shy

-shy

603a 603a

603a a Standards apply throughout the engine useful life b Standards apply only when the engine is new Source Canada Gazette Part II Vol 137 No 24 2003-11-19

34 Europe

In 1998 the European Union introduced exhaust emission limits for small petrol engines through Directive 9768EC and in 2002 introduced amendments through Directive 200288EC The limits in the Directives align with the US regulations however they do not have averaging and banking provisions

Table 8 European Emissions Standards

Small Engine Class Type (HC+NOx in gkW-hr) 2004 2005 2006 2007 2008

SN1 (lt66cc) Non-handheld (eg lawn mowers)

161 161 161 161 161

SN2 (66 to lt 100cc) 161 161 161 161 161

SN3 (100 to lt 225cc) - - - 161 161

SN4 (225cc or more) - - 121 121 121

SH1 (lt20cc) Handheld (eg trimmers)

- - - 50 50

SH2 (20 to lt50cc) - - - 50 50

SH3 (50cc or more) - - - - 72

13

The European Union is currently considering including useful life criteria and averaging and banking provisions plus it is considering introducing a Directive to further reduce emissions from diesel engines The objective of the proposal is to tighten emissions standards for engines in general non-road applications in light of technological developments and it taking into account the parallel developments for similar legislation in the United States in order to harmonise the environmental standards and to facilitate trade

Charts comparing the USA Californian and European Emission Limits are shown below

14

35 Summary of Regulations for Non Handheld Equipment

KEY TO CHARTS

USEPA CARB EU

0

10

20

30

40

50

60

70

80

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

0 to 49cc

0

10

20

30

40

50

60

70

80

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

50 to 65cc

0

2

4

6

8

10

12

14

16

18

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

100 to 224cc

0

2

4

6

8

10

12

14

16

18

20

2000

2002

2004

2006

2008

Year Model

HC

+N

Ox g

kW

-hr

225cc and over (up to 19kW)

15

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

36 Summary of Regulations for Handheld Equipment

KEY TO CHARTS

USEPA CARB EU

20 to 49cc 0 to 19cc

250 250

200

150

HC

+N

Ox g

kW

-hr

100

200

HC

+N

Ox g

kW

-hr

150

100

50 50

0 0

Year Model Year Model

50 to 65cc 66 to 80cc

160

160

140

140

120

40 40

20 20

0 0

120

HC

+N

Ox g

kW

-hr

HC

+N

Ox g

kW

-hr

100100

8080

60 60

Year Model Year Model

16

Summary of Regulations for Handheld Equipment (continued)

KEY TO CHARTS

USEPA CARB EU

0

20

40

60

80

100

120

140

160

2000

2001

2002

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

81 to 224cc

0

20

40

60

80

100

120

140

160

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

225cc and over (up to 19kW)

17

4 Australian Market for Small Engines

41 Likely compliance with overseas emissions standards

As part of this assessment an environmental profile of equipment currently on the Australian market has been developed initially based on information from manufacturersrsquo brochures and web sites and industry magazines and then confirmed through follow-up with relevant industry contacts

Each item of equipment has been assessed on its compliance with USEPA CARB or European regulations In most cases it was not possible to match models available on the Australian market with CARB lists (CARB publishes exhaust emissions data on all appliances on its web site) This was mainly due to the inconsistency of model designations and uncertainty about ldquoengine familiesrdquo

Engine characteristics and retail price were difficult to obtain Some brochures also made claims of compliance with USEPA European or CARB requirements The detailed breakdown of current equipment on the Australian market is given in Appendix 1

The majority of small engines sold in Australia are imported and many come from countries that impose emission limits The extent of imports into Australia that do not comply with the country of origin standards is not known Industry estimates that 40 of garden products are sold through importers who are not linked to manufacturers of US EPA or European certified equipment and the source of some products sold here is difficult to establish Victa is the only company producing small engines in Australia Its iconic 2-stroke lawnmower currently cannot meet overseas emission limits

Outdoor Power Equipment Association (OPEA) assisted in identifying the Australian distributors of most brands of powered garden equipment In April 2006 a survey form was sent to a total of 43 distributors representing 97 brands of equipment The survey form sought information about the engine for all petrol-fuelled garden equipment with a power not more than 19kW

Figure 2 Extract from survey form

18

Initial response to the survey was poor Despite follow-up action and efforts from the industry association at the beginning of September 2006 26 distributors had responded to the survey information and only 13 distributors provided all data necessary for benchmarking purposes This resulted in emission compliance data for about half of the estimated products on the Australian market Attempts to match Australian models with the database maintained by the Californian Air Resources Board were also of limited success due to inconsistencies in model designations between Australia and the USA and the manner in which model information is coded in the CARB database

Table 9 Summary of distributor responses

Responses status Not OPEA OPEA ALL

Number of responses 9 8 (31) 17 (40)

Response - all data 4 9 13 (30)

Response - extra time sought 3 3 (7)

Response - no petrol products 4 1 5 (12)

Response - some data 5 5 (12)

Grand Total 17 26 43 percentages may not add to 100 due to rounding

Of the 97 brands initially identified

bull 16 brands are apparently no longer sold in Australia

bull No responses were received for 29 brands

bull Partial data were received for 12 brands

bull All data was available for 30 brands

Table 10 Summary of responses by brand

Count of brands

Analysis status Not OPEA OPEA All

Missing some data 12 12

No data received 9 (27) 20 (31) 29 (30)

No longer sold 13 3 16

Response - no models to list 3 7 10

Response received (electronic form) 5 11 16

Response received (paper form) 3 2 5

Response received (spreadsheet) 9 9

All 33 64 97

A 2004 report for the NSW DEC estimated that there were about 1200 eligible garden

19

products in the Australian market The current project has obtained data for a total of 870 products or 72 of the estimated population In addition the sampling method is likely to be biased towards products with good environmental performance In these circumstances the following analysis should be regarded as indicative only

Survey results

The following tables and figures show expected compliance with European CARB or USEPA requirements based on the limited information provided by industry

Table 11 Engine type and compliance with overseas standards Count of products Engine type

Best STD 2c 4c Unknown All 1997 - US EPA I 53 32 85 (10) 200288EU 17 17 (2) 2004 - US EPA II 1 3 4 (lt1) 2004 EURO I 8 8 (1) 2005 - US EPA II 10 29 5 44 (5) 2006 - US EPA II 107 141 2 250 (29) 2006 EURO I 6 6 (1) 2007 - US EPA II 1 1 (lt1) 2007 Euro II 2 2 (lt1) None 118 90 208 (24 Unspecified 24 60 161 245 (28) All 344 358 168 870

Unknown means the type of engine is unknown (but is most likely to be 2c) Unspecified means that the status of emissions compliance was unable to be identified None means the manufacturerdistributor has indicated that the equipment does not comply with any overseas emissions standard

Figure 3 Compliance with overseas standards - all surveyed products Note Unknown in chart includes unspecified and unknown from Table 11

20

Figure 4 Compliance with overseas standards by equipment type ldquoPhase 1 equivrdquo means the engine complies with US EPA phase 1 or 200288EU ldquoPhase 2 equivrdquo means the engine complies with US EPA Phase 2 Euro I or Euro 2 ldquoUnknown means that engine cycle (stroke) was not provided

Of the 41 categories of equipment in the survey 15 had at least 10 current products Results for these categories are set out below

Figure 5 Engine type for popular categories

21

Figure 6 Compliance with overseas standards for popular categories ldquoPhase 1 equiv means the engine complies with US EPA phase 1 or 200288EU Phase 2 equiv means the engine complies with US EPA Phase 2 Euro I or Euro 2 ldquoUnknown means that engine cycle (stroke) was not provided

42 Australian Sales of Outdoor Powered Equipment

The Australian Outdoor Power Equipment Association (OPEA) whose membership represents about 80 of the manufacturersdistributors and dealers in the industry commissions regular independent industry audits of garden equipment sales (OPEA personal communications) Sales data from OPEA is shown in Table 12

22

Table 12 Sales of outdoor garden equipment 2002 and 2005-06 2005-06 2 stroke (1000)

2002 2 stroke (1000)

2005-06 4 stroke (1000)

2002 4 stroke (1000)

2005-06 TOTAL (1000)

2002 TOTAL (1000)

Walk behind mowers 72 170 351 76 424 246

Brushcuttertrimmer 321 12 17 180 339 192

Chainsaws 152 0 0 90 152 90

Chipper shredders 0 60 46 0 46 60

Blowerblower vacuums 98 0 11 50 109 50

Ride on mowers 0 25 51 0 51 25

Generators 11 32 96 0 107 32

Hedge trimmers ampothers 40 192 0 28 40 220

694 491 476 424 1267 915

for total sales 593 463 407 537

for mowers 152 280 848 720

According to OPEA approximately 424000 walk behind lawnmowers and more than 792000 units of outdoor handheld equipment were sold in Australia in 2005-06 In addition there were sales of about 80000 replacement engines and 70000 pumps in 2005-06 most of which were four strokes These figures show that there has been considerable growth in the sales of most products with the exception of chipper shredders and the category lsquohedge trimmers and othersrsquo whose sales declined in 2005shy06 compared with those in 2002 About 17 of walk behind lawnmowers were two stroke and 83 four stroke which is an improvement in the uptake of cleaner engines when compared to 2002 when about 30 were two stroke The situation with handheld equipment is reverse with nearly 79 being two strokes compared to 47 in 2002 However many models of two stroke handheld equipment meet current US emission standards and care should be exercised in using engine type (two stroke or four stroke) as an indicator of emissions performance for this class of equipment

The OPEA 2005-06 sales estimates are shown in Figure 7 OPEA cautions that there is considerable uncertainty about the estimates for brushcutters and blowerblower vacuums as OPEArsquos figures only represent 50 and 60 respectively of sales of these products No estimates of future sales trends were identified during research for this project

23

Australian sales of 2 and 4 stroke outdoor equipment 2005-6

0 50 100 150 200 250 300 350 400

Walk behind mowers

Brushcuttertrimmer

Chainsaws

Chipper shredders

Blowerblower vacuums

Ride on mowers

Generators

Other

Annual sales (x 1000)

4s 2s

Figure 7 OPEA estimates of equipment sales in 2005-06 Note Blowervac is an industry term for equipment that combines blowing and vacuuming functions

Briggs and Stratton (Australia) who import engines from the USA supply the majority of the four stroke engines for handheld equipment sold in Australia and these comply with all the current USA and CARB regulations Imported handheld garden equipment is shipped fully assembled to a branch or distributor and is then sent to a retailer The retailer may or may not provide equipment servicing

OPEA members have expressed concern regarding the increasing sales of imported high polluting two stroke engines that allegedly do not meet any emission standards and come from countries that do not have emission standards One industry representative reported that some of the imported trimmers were being manufactured in China using outdated designs and tooling from two old bankrupt American companies and these are being sold here at about 30 of the price of traditional brands and very low cost generators from China now account for around 70 of total sales It is difficult to confirm this trend without undertaking a detailed examination of Australian import data however the significant increase in the sales of two stroke handheld equipment provides some support for this trend

On the other hand it is claimed by industry that the ride on mower market (predominately with compliant four stroke engines) has been stimulated by the Australian USA free trade agreement

24

5 Australian Users of Small Engines This section examines the market segments for garden equipment and customer purchasing behaviour

51 General Public

Purchasing behaviour

Research into consumer purchasing behaviour has found that consumers assess a product against a range of attributes for example price weight brand reputation servicing and parts availability warrantees and guarantees experience size promotions and discounts Studies have also revealed that up to 82 of Australians had bought products on the basis of social or environmental factors in the previous year (State Chamber of Commerce 2001) Related to this point the energy star rating ecolabel on whitegoods was viewed as a credible environmental claims system which is well regarded by the general consumer (Product Category Manager Mitre 10 personal communications)

As the purchase of small engine garden equipment by the general consumer is an infrequent purchase which carries a certain of amount of risk With small engines the risk can be functional risk (will not perform as expected) physical risk (for example safe features such automatic cut out on an electric lawn mower) or financial risk especially for the more expensive items The general consumer is likely to lessen the risk by seeking information and by evaluating the information on the available products over a period of time The consumer may also lessen the risk by

bull purchasing well known brands

bull buying the brand offering the best warrantees and guarantees

bull buying the most expensive brand and

bull buying a brand they have used before

Research indicates that the desired attributes of a product may not be well established at the start of a consumerrsquos search process but will often be refined as the consumer learns more about the product The consumer will also use a ranking and weighting process based on desired qualities and trade offs may be made

Reportedly purchases of engine operated garden equipment are based on price yard size fitness for purpose and other features such as weight and ease of starting (Product Category Manager Mitre 10 personal communications) Males are the predominant purchasers of garden equipment however because of changing demographics there has been an increase in the number of women purchasing these products

Less than 5 of lawnmowers purchased are push or electric mowers (Product Category Manager Mitre 10 and industry sources personal communications 2003)

25

Electric mowers are generally perceived as not being as effective as cords have limited range and rechargeable electric mowers require frequent recharging

There is a recent trend towards ride on mowers (all four strokes) probably because of changing demographics specifically older age groups moving to more rural environments with larger yards (OPEA personal communications)

A study (Wilkie 1994) investigated consumer appliance purchasing behaviour and found that the general consumer consulted a range of information sources before purchasing an appliance The appliance salesperson was found to be the most important information source for many consumers Other important information sources include newspaper advertisements friends and relatives catalogues consumer reports and brochureslabels Since Wilkiersquos study the internet will have become increasingly important as a research tool and in some instances as a way to purchase products As part of this study there is evidence of low priced products being sold into the Australian market via the internet only ndash a practice that is likely to increase in the future It was difficult to source any compliance or details on these products

At the retail chain level staff product training is generally voluntary undertaken out of store hours and as an inducement to attend training sessions suppliers usually provide incentives for staff Retail chain purchases are very price driven although some chains are reportedly interested in stocking goods that have credible environmental claims (Mitre 10 and other retail chain sources)

IBIS (2006a) reports that the domestic hardware sector which is dominated by Danks (Home Timber and Hardware Thrifty - Link Hardware and Plants Plus Garden Centre) and Bunnings is classified as a growth market and the sales of lawnmowers and other lawn and garden machinery and equipment represent about 14 of sales revenue

In summary it appears that a range of product attributes influences consumer purchases of lawnmowers and outdoor equipment Currently there is very little information about emissions in any of the information sources a consumer is likely to consult when purchasing these products Nevertheless surveys indicate that consumers are concerned about the environment and are open to including environmental considerations into their purchase decision Educating sales staff about the air emissions from lawnmowers and outdoor equipment together with ecolabels could therefore be important methods for influencing consumers towards the purchase of cleaner products

Equipment Usage

The USA Outdoor Power Equipment Institute CARB (cited in USEPA 1998) and the USEPA (USEPA 1998) have made estimates of annual usage rates and average life spans of outdoor equipment for the general consumer user and for the commercial user Table 13 gives USA usage and lifespan range for selected items of powered equipment

26

Table 13 USA Average Usage and Lifespan of Outdoor Garden Equipment For General Consumers and Commercial Users Equipment Annual usage (Hours) Lifespan (years)

General Consumer

Walk- behind mowers 20-25 6 -7

Rear engine ride on mowers 4 6 -7

Chainsaws 7 5-9

Leaf blowers 9-12 5-9

Trimmers 10 5-9

Commercial User

Walk- behind mowers 320 27

Rear engine ride on mowers 380 38

Chainsaws 405 1-13

Leaf blowers 170-293 18-28

Trimmers 170 - 275 15-28

Discussions with members of the Australian industry confirm that Australian hours of use are likely to be similar to the American estimates although this can vary depending on location For example in tropical areas lawns are mowed more often because they grow faster in this climate The American turnover of equipment is however probably higher than here as the Australian consumer tends to keep their equipment longer and so the useful life of a mower is more likely to be on average 10 ndash12 years

52 Garden and Ground Maintenance Services

According to a recent IBIS report (2006b) the revenue for this industry in 2005-06 was $383 million and the industry outlook is lsquobrightrsquo with a predicted annual average 5 growth over the next few years The Australian customer base for garden maintenance services including for lawn mowing is

Households 55 Business 25 Government 20

The sector is reportedly a growth industry due to

bull the aging population

bull the increasing numbers of households that are time poor income rich and

bull the growing trend for professional landscaping which requires a higher level of garden maintenance

27

The main customer base for these businesses includes middle to upper socioeconomic groups the aged and people who are physically disabled Growth is predicted particularly for the franchise industry with demand from the commercialindustrialgovernment sectors (IBIS 2003) A 1999 ABS survey reported that nearly one-third of older people purchased at least one domestic service per fortnight with gardening assistance being the most common This accords with an industry estimate that about 25 of householders pay someone to mow their lawn (Jim Penman Jimrsquos Mowing personal communication) The industry is sensitive to economic conditions and weather for example the drought has slowed growth over the last few years

The garden maintenance sector is dominated by small independent operators with two major franchisers Jimrsquos Mowing and VIP VIP nationally has 600 franchises and Jimrsquos Mowing about 400 Jimrsquos Mowing reportedly mows about 15000 lawns and has 53 of the market (IBIS 2006b) As franchised lawn mowing services represents about 14 of the lawn mowing services nationally it can be estimated that approximately 280000 lawns are mowed nationally by commercial operators

Jimrsquos Mowing and VIP provide training and advice to new franchisees on equipment including proper maintenance schedules Training generally occurs before franchisees purchase their equipment Most franchisees equipment would consist of two mowers a brushcutter an air blower and possibly a hedge trimmer or chain saw Operators prefer four stroke mowers and these are used for an average eight hours per week Brushcutters are generally two strokes as are other motors (IBIS 2006b and Jim Penman personal communication)

From the above it is estimated commercial operators operate mowers for up 34 million hours per year (or 8 of the total estimated mowing hours per year) and purchase approximately 66000 lawnmowers annually (25 of purchases) The sectorrsquos purchases of brushcutters is estimated to be approximately 8000 units per year or 37 of purchases Table 13 provides US commercial userrsquos annual average hours of use and average equipment life spans ndash it would be anticipated Australian rates would be similar

The main businesses contracting to provide ground maintenance services to the corporate and government sector (including universities) are Spotlessrsquos Open Space Management Transfield and Programmed Maintenance Services all of which are diversified publicly listed companies plus the Danish owned company ISS (previously Tempo Services) (IBIS 2003 and 2006b and company websites) The type of services they provide means it is likely they would have an array of equipment and a preference for the more powerful ride-on mowers and for Class V handheld equipment

53 Government Purchasing

The way purchasing decisions are made by government or other large organizations is generally very different to the approach taken by the general household consumer

bull many of the purchases are for large quantities of goods

28

bull there are well established policies and procedures in place to guide purchasing with the purchase criteria established early in the buying process and

bull those making the purchase are likely to be more knowledgeable about the product than the average consumer and they are usually not the eventual user of the goods

Value for money fitness for purpose ability to supply and over recent years environmental aspects are likely to be important factors in the purchasing decision for Government

Local State and Commonwealth Governments have responsibility for the upkeep of public assets many of which include public open space and other outdoors areas At the State and Federal level these include schools universities sporting facilities hospitals and defence facilities These services may be outsourced individual departments may undertake maintenance and purchase their own equipment or they may purchase equipment through a central purchasing facility With the central purchasing facility these items are generally purchased under contract While there is an increase in the inclusion of environmental considerations in the selection criteria for purchasing goods and services especially under contract these considerations mainly relate to waste management and recycling criteria and not air emissions

Local councils in some states for example NSW generally take responsibility for ground maintenance within their council areas or for some smaller councils the service may be contracted to a neighbouring council In other states such as Victoria there is a trend to outsource ground maintenance contracts to commercial providers

It is unknown what proportion of total sales that direct Government purchases represent however it likely to represent a relatively small share of several percent of the overall market

In summary

bull The general household consumer represents the major market segment for garden equipment accounting for up to 90 of product sales

bull Government is likely to be relatively small direct purchaser of garden equipment

bull Commercial garden services to households purchase approximately 25 of lawnmowers per year and 37 of brushcutters

bull Large ground maintenance companies are likely to prefer larger and more powerful equipment such as ride-on mowers

29

6 Result of Stakeholder Consultation

61 Regulations

The Small Engine Expert Panel ndash Outdoor Equipment considered in depth an approach to take to improve the emissions performance of outdoor garden equipment sold in Australia Discussions were particularly focused on the growing influence of cheap high emissions imported products together with the difficulties that the local manufacturer of lawn mowers is likely to face in complying with the relevant overseas standards As part of this process the industry representatives on the Panel held additional discussions and they consulted international industry experts at the manufacturing level in Europe the USA and Japan

OPEArsquos preference is for the adoption of regulations based on the USEPA standards with Phase 1 being adopted possibly from as early as 2007-08 The industry then proposes that Phase 2 be introduced in 2012 Phase 1 USA EPA standards were adopted in the USA in 1995 to be applied to equipment manufactured from 1997 and Phase 2 standards were introduced in 2002 through to 2007 and these included averaging banking and trading provisions A comparison between the USA Phase 1 and Phase2 standards is given in Table 14 The USEPA is discussing Phase 3 limits for the adoption in 20102011 which includes tighter exhaust emission limits for non-handheld equipment

The emissions limit of the two stroke lawn mower manufactured by the sole Australian manufacturer are well above USA Phase 1 limit for non-handheld equipment One avenue to address this issue which was supported by the Expert Panel ndash Outdoor Equipment would be to place lawn mowers in the US EPA Category 5 (engines gt50cc) This would result in emissions for two stroke lawnmowers being limited to 161 gkW-hour HC + NOx compared to the USA regulated limit of 161 gkW-hour HC + NOx Doing this would align the ramp-up timetable for mowers with that of other garden products

Table 14 Comparison between the USA Phase 1 and Phase 2 standards

Emission Limits GkW-hr

Phase 1 (1997 ndash2001) Phase 2 (2007) HC NOx HC+NOx CO HC+NOx CO

Non-handheld I-A lt66cc 161 610 I-B 66-lt100cc 161 610 I 100-225 cm3 161 519 161 610 II 225 cm3 134 519 121 610 Handheld III lt20 cm3 295 536 805 50 805 IV 20-50 cm3 241 536 805 50 805 V 50 cm3 161 536 603 72 603

Phase 2 limits were phased in between 2002 -2007 during which time they became tighter for simplicity only the 2007 are shown in this table (see Table 2 for more details)

30

In addition to limiting emissions the Expert Panel support the inclusion of the durability criteria which apply in the USA under Phase 2 standards and certification documentation from either the USA or Europe as adequate proof of conformity Equipment that has not been tested and certified to USA or European standards will be required to have the engines tested in a NATA certified laboratory

Some in the industry argued that regulations should include provisions for averaging for companies that wish to use it however they felt banking and trading provisions would not be necessary Industry representatives were not supportive of any Australian consumer labeling requirement instead OPEA members are willing to supply emissions data for inclusion in a web-based database that would allow purchasers to assess the environmental credentials of different makes and models

62 Discussion on recommended regulations

Timing of introduction

Some industry representatives argue that introduction of Phase 1 standards in 2007-08 will not give the industry an adequate transition period in which to develop competence in emissions certification establish new procedures and tooling in the dealers workshops train dealers and technicians on legal requirements distribute specific tooling and spare parts and reduce stocks of old (non certified) products without incurring an undue financial burden While others in the industry prefer progressing straight to phase 2 standards

If the OPEA preference for the adoption of the United States Phase 1 regulations which operated in the USA between 1995 and 2001 were introduced in Australia in 2007-08 they would be well behind the USA standards and worldrsquos best practice Furthermore the introduction of the United States Phase 2 - 2007 limits in Australia in 2012 would if the USEPA introduce Phase 3 in 2010-11 see emission limits for lawnmowers and other non handheld garden equipment in Australia still lagging United States standards and worldrsquos best practice

To introduce regulations in 2007-08 will require Government firstly to determine the most appropriate mechanism under which to enact the regulations draft the regulations prepare the regulatory impact assessment consult with the broader community and then finalise the regulations It is likely an Act of Parliament will be required at the Commonwealth level followed by complementary legislation at the State and Territory level It is possible for this to be achieved in less than a two year timeframe (as was the case for the Water Efficiency Labelling Scheme) However regulations that do not have a level of perceived urgency would take longer The level of importance and urgency to control emissions from small engines has yet to be debated and determined

31

Modified USEPA limits for lawnmowers

From the 183 lawn mowers identified through the market survey Victa is the main (possibly sole) provider of two stroke mowers with the other lawnmowers having cleaner four stroke engines

Victa is undertaking work to produce a cleaner product Victa estimates it would need a number of years to complete development production tooling and commercialisation of the cleaner engines In January 2007 it released a new two stroke carburettor lawnmower that has reduced engine emissions by more 30 but the combined HC and NOx emissions are still above USEPA Phase 1 limits Victa says this new engine is the outcome of four years of collaborative work by Victa and the University of Technology Sydney Victa is continuing with this research to further reduce emissions

A clause that allows exemptions to be granted as occurs in other countries could be included in the regulations however Victa argues that this would create uncertain trading conditions for the company for a period of time until an exemption were granted

Placing lawn mowers in the US EPA Category 5 (engines gt50cc) has the risk of opening the Australian market to more two stroke lawn mowers which has the greatest use of any outdoor powered equipment however it should see the continuance of the sole engine being manufactured in Australia In 1995 when it was introducing small engine emission limits the USEPA faced a similar issue with two stroke lawn mowers and used a similar approach by allowing two stroke lawn mowers to comply with the handheld standards It also specified that the number of two stroke lawnmower engines allowed to meet handheld standards would be subject to a declining annual production cap with the allowance provided by the production cap being phased out in 2003 There is also similar precedent for small engine emission limits that depend on engine type - European regulations for marine outboard motors set less stringent requirements for two stroke motors

Averaging Banking and Trading Provisions

The US EPA did not have averaging banking and trading provisions in Phase 1 and therefore all small outdoor engines were required to meet the Phase 1 limits It only introduced ABT provisions in the much more stringent Phase 2 as they would allow the most economic introduction of cleaner engines The industry claims the systems to use this provision are available and can be implemented in Australia by those who wish to use it at little cost to government

Industry claim that any supportive economic data related to averaging is sensitive and confidential It is there difficult without substantial justification by the industry to support the provision for averaging in conjunction with Phase 1 particularly given the elapsed time between the introduction of Phase 1 in the USA and their recommended introduction in Australia If there are some low volume equipment items that still cannot meet the USAEPA Phase 1 standards then these could be subjected to

32

exemptions if adequate justification can be provided (exemptions for small volumes were available under the USEPA regulations)

It was noted that for government to implement regulations a regulatory impact statement is required and this requires an assessment of the costs and benefits of the options considered with clear overall benefits shown for the preferred option Therefore if the option for manufacturers to use averaging were to be considered more information to support its inclusion would be required

Other options that could be considered to circumvent the inclusion of averaging include

i including clauses that give manufacturers the ability to apply for exemptions from the regulations for classes of equipment that have small sales volumes (these provisions are available in the USA)

ii limiting the regulation to popular types of equipment

iii using the end-of-model life provisions that have been used in the Australian Design Rules for cars In effect the end of model life provisions require new designs to comply from the implementation date but allow older models to remain on sale for a few more years This is an alternative to ABT because it facilitates earlier introduction of the regulation

iv Having a phase in period of say 2 years during which existing models can continue to be sold but new models coming on to the market must comply with the new standards At the end of the phase-in period all models must comply with the new standards This is an approach that is used when Australian Design Rules (ADRs) are introduced for motor vehicles

Consumer Information

Current Australian directions to reduce the environmental impact of consumer products favor tiered benchmarks using a lsquostarrsquo rating system (see Appendix 3 for examples such as the Mandatory Energy Efficiency Label and the Water Efficiency Labelling Scheme)

As products generally arrive in Australia assembled and packaged industry considers a mandatory requirement to label products with an Australian style star rating would impose a cost on distributors that would drive up the retail price of products Instead the OPEA members were willing to supply emissions data for inclusion in a web-based database that would allow purchasers to assess the environmental credentials of different makes and models Given the diverse nature of the industry it is unlikely a database would provide complete coverage of all products on the Australian market but inclusion in the database would indicate that the manufacturer has a commitment to environmental performance It was acknowledged in discussions that at least some Phase 2 compliant products would become available prior to 2012 and the web-based database would provide one method to promote those cleaner engines

33

In summary the Recommendations of the Expert Panel

1 Mandatory air pollutant emission standards to be introduced in Australia for all outdoor equipment (lt19kW) powered by spark-ignition engines The development of any regulation would need to be based on a formal assessment of the costs and benefits of nationally regulating 2 and 4 stroke lawn mowers and handheld power equipment which should be commenced immediately

2 Proposed standards to mirror US EPA regulations (compliance with equivalent EU regulations also acceptable)

3 Timing (subject to completion of assessment of costs and benefits)

(a) US EPA Phase 1 ndash Effective from 2007 2008

(b) US EPA Phase 2 ndash Fully implemented in 2012 (in step with 2007 USEPA limits) with phase-in period andor ABT over 2008-2012 to provide for early introduction of cleaner product

4 Walk-behind 2 stroke mowers to be included in US EPA Category 5 (gt50cc) product classifications Implementation timing to be as in Recommendation 3 above

5 All products also to be certified to relevant EPA durability categories

6 Subject to further review ABT (if included) may be phased out after 2012

34

7 The Way Forward

The optimum approach for garden equipment out engine emissions of options needs to be sustainable and cost effective This will need to be determined through a costs and benefits analysis (CBA) CBA assigns monetary values and typically assesses the impacts on the consumer on human health on the environment on industry and on government A detailed costs and benefits analysis is beyond the scope of this report however the following sections draws on available information to provide some indication of the possible costs and benefits that are associated with emissions from garden equipment engines

Air Quality Benefits

Environment Canada estimated the introduction of the regulations would result in a 44 percent reduction in combined HC+NOx emissions from small engines used in garden equipment and reduction in individual air pollutants over a 25 year period as shown in Table 15 The Canadian estimates incorporate the benefits that would accrue from the MOU signed with the industry in 2000 plus the benefits from the regulations introduced in 2003 In 2000 Canada imported around 13 million small spark-ignition engines and machines (ie a similar number to Australia) with 80 supplied by the USA

Table 15 Canadian Small Spark-Ignition Engine Emissions in Year 2025

Substance Base Case Emissions in 2025

Emissions in 2025 with Regulations

Percentage Reduction in 2025 (Regulations vs Base Case)

Criteria Air Contaminants (kilotonnes)

HC 772 410 469

NOx a 84 67 201

CO 1413 1403 07

Greenhouse Gas (kilotonnes)

CO2 2903 2645 89 Base case year 2000 (accommodating voluntary agreement) Source Canada Gazette Part II Vol 137 No 24 2003-11-19

Other Environmental Costs and Benefits

In addition to the human health benefits associated with reduced exposure to ozone there is a range of other public benefits including reduced damage to vegetation and therefore higher crop yields less damage to materials and structures particularly

35

some rubber products and improved visibility due to a reduction in smog haze Plus there are benefits associated with lower emissions of other air pollutants

To date there appears to have been little work undertaken in assigning a monetary value to these benefits as it is considered that they are likely to be small compared to human health impacts

Health Costs and Benefits

The Final Impact Assessment for the Ambient Air Quality National Environment Protection Measure (NEPC 1998) estimated that the health damage costs from exposure to ozone nationally to be in the range of $90 ndash $270 million (in 1998 dollars) This figure did not include mortality costs because of difficulty in assigning a figure to human life nor did it include costs associated with minor symptoms such as sore throat cough headache chest discomfort and eye irritation that can result from ozone exposure On the cost of ozone exposure the Impact Assessment states that lsquothe social well-being associated with potentially 6 and 20 million fewer irritating symptoms annually cannot be reliably quantified but at $1 a symptom it adds up to an appreciable amountrsquo

Since the Air NEPM Impact Assessment ozone levels in Australian urban areas have not fallen significantly but the population and medical costs have increased since then However using the above figures to make a rough estimate the contribution made by engines used in lawnmowers (ie not including other garden equipment) to the health damages cost from ozone exposure would be at a minimum $36 - $108 million not including the cost of mortality or minor symptoms As any action on these engines is likely to only remove high emission engines over a decade or more a CBA would be required to include an assessment of the proportional health benefits that would accrue from only removing the high emitters over time

Costs and Benefits to the Consumer

In 1995 the USEPA estimated that on average the cost to the engine manufacturer to install the necessary emission control technology to meet Phase 1 standards (which didnrsquot have ABT) would be approximately $US2 per engine used in nonhandheld equipment and $US350 per engine used in handheld equipment It also estimated that this would translate to sales-weighted average price increases of about $US7

The introduction of phase 2 regulations USEPA estimated would result in price increases of between $US20 and $US64 for handheld equipment depending on the equipment class (USEPA 2000) where handheld engines ranges in price from $60 to $1000 (USEPA 1995)

In addition to emission reductions the implementation of exhaust emission limits has the advantage of reducing fuel consumption and lowering operating costs to the consumer For example the USEPA estimated that for Phase 1 limits that applied between 1995 and 2001 on an average sales-weighted engine basis would decrease fuel consumption by 26 percent for non handheld equipment and a 13 percent decrease in fuel consumption for handheld equipment (USEPA 1995) Phase 2

36

(current limits) would result in a further decrease in fuel consumption of approximately 30 percent for handheld engines

When the USEPA considered the fuel savings offset and the retail price increase it estimated that the average sales-weighted lifetime increase in cost would be about $US650 per handheld engine while nonhandheld engines will realize a lifetime savings of about $US250 per engine This does not include the lifetime savings in maintenance costs which should further benefit the consumer (USEPA 1995)

Euromot (The European Association of Internal Combustion Manufacturers) claims that compliance with European minimum performance standards that do not have ABT provisions adds around 30 to the cost of some products that have had to be brought into compliance4 compared to products sold under the ABT system in the US

Costs and Benefits to Industry and Government

As there is only one local manufacturer among the 43 distributors of powered outdoor garden equipment sold in Australia and all others are importers the main costs to reduce the emissions contribution made by these engines will be associated with program administration and compliance particularly if regulations are introduced

The Productivity Commission an independent agency which is the Australian Governmentrsquos principal review and advisory body on microeconomic policy and regulation recently examined the cost effectiveness of measures to improve the energy efficiency in household appliances As part of its review lsquoThe Private Cost Effectiveness of Improving Energy Efficiencyrsquo it examined labelling programs (ie regulated tiered benchmarks) and minimum mandatory energy efficiency requirements (ie a regulated simple benchmark) While the household appliance market is considerably larger than the garden equipment market the Commissionrsquos final report contains some information that is useful for determining the approach that could be used to establish an emissions reduction scheme for garden equipment A summary of relevant sections of this report is provided in Appendix 3

The Commission identified both administration and compliance costs associated with labelling programs and minimum mandatory energy efficiency requirements as well the impacts these had on product suppliers

The Department of the Environment and Water Resources provided details to the Commission on the costs involved in administering both the labelling scheme and the minimum performance standards for energy programs The information provided showed that

bull the administration costs of the simple benchmark approach were substantially lower (less than one tenth) than for labelling and 84 per cent of administration costs were passed on to appliance purchasers with the remainder borne by governments

4 Presentation by Dr Holger Lochmann Rob Baker Axel Rauch Stihl 19 April 2006

37

bull the compliance costs for labelling are higher

bull minimum mandatory energy efficiency requirements can have a greater cost for suppliers than labelling since suppliers must adjust their model ranges to meet the MEPS levels by the given date These compliance costs are however influenced by the lsquolead inrsquo time between introduction and the implementation of the regulations

bull The increased cost to appliance purchasers of labelled appliances was about two and half times higher compared to appliances purchased under minimum mandatory energy efficiency requirements this being due to consumers voluntarily purchasing more efficient appliances

Overall the Commission considered that labels should be more actively considered as an alternative to minimum performance standards The Commissionrsquos support was based on the ability of labels to amongst other things

bull directly address ldquoa source of market failure mdash the asymmetry of information between buyers and sellers of energy-using productsrdquo

bull provide information to the consumer that is readily-accessible and easily-understood so they can help the consumer make better-informed choices

bull Have net social benefits and possibly have net benefits for consumers

bull provide a greater incentive for suppliers to sell environmentally better products

bull warn consumers through a disendorsement label that an appliance is very inefficient This approach can discourage but not prevent consumers from buying the poor performing product

71 Options to Reduce Emissions from Garden Equipment Engines

There is a range of options that could be considered for reducing emissions from engines used in outdoor garden equipment in Australia These include

1 Do nothing

2 Partnership Programs

3 Quasi regulation

4 Co-regulation

5 Regulations

In the following discussion about these options many Australian examples are mentioned Further details about these programs plus an overview are provided in Appendix 2

38

72 Option 1 ndash Do Nothing

Based on data supplied by OPEA the sales of high emitting two stroke carburettor engines as a percentage of engines used in outdoor equipment increased during the period 2002 to 2005-6 (see Table 12) from 463 to 593 and overall sales number increased by 38 during that period There is no indication that in the short to medium term that sales of equipment with two stroke carburetor engines will decrease in overall sales numbers or as a percentage of sales Therefore under the lsquodo nothingrsquo option emissions from outdoor garden equipment will continue at the same rate or perhaps based on sales figures of two stroke carburetor powered equipment at an even higher rate in the future

73 Option 2 ndash Industry - Government Partnership

In the discussion papers prepared for the NSW small engine project (2004) some examples of successful voluntary Government-Industry Partnership programs were provided The examples included were

bull the National Industry Reduction Agreement where the major newspaper and magazine publishers in Australia agreed to promote recovery and recycling of old newspapers and magazines

bull the NSW EPA-Oil Industry MOU on Summer Fuel the National Packaging Covenant (which has legislative backup) and

bull the EPA Victoriarsquos agreement with the Altona Chemical Complex

From the Australian programs reviewed it appears that the best indicators for successful partnership programs are

bull a relatively small number of firms within the industry

bull a commitment and involvement by all of the industry

bull clear program aims and objectives plus program targets and

bull a willingness by the industry to enter into a cooperative partnership with government

There are 43 identified distributors selling 97 brands of outdoor powered equipment in Australia Many of the major distributors are members of OPEA but there are many distributors who are not members It is therefore unlikely that the even the majority let alone all of the Australian distributors would commit to a industry-government partnership to reduce emissions

74 Option 3 - Quasi Regulation

Quasi regulations can take a range of forms the most usual being the establishment of a code of practice that industry endorses and implements A fundamental part of the code of practice would be emissions standards There are few examples of the use of codes of practice to limit emissions

39

Governmentrsquos role under this scenario is likely to be in assisting in the development of standards

The likelihood of this option being successful for similar reasons to the industry government partnership option is low

75 Option 4 -Co Regulation

Co-regulation is an agreement by industry and government to certain undertakings that support the uptake of cleaner products with a regulatory base It allows industry program flexibility to achieve certain negotiated targets Australian examples of coshyregulation include

bull The Green Vehicle Guide which operates through an industry government agreement where industry report test results to government in an agreed format within a certain timeframe Government manages the data and promotes the program This program is underpinned by Australian Design Rules for motor vehicles

bull The electrical appliance stand-by power program where there are agreed targets established that industry is required lsquovoluntarilyrsquo to meet failure to achieve the targets will result in regulation

bull The Packaging Covenant which is a program that allows industry the flexibility to design it own programs to reduce packaging waste and achieve certain target The Covenant is complemented by the NEPM on used packaging which specifies certain government responsibilities to support the program plus measures that will be introduced if targets are not met

Given the large number of distributors on the Australia market co-regulation for engines used in garden equipment using a similar form to the standndashby power program or the packaging program - an agreement by industry and government on a percentage reduction target for the sale of high emitting engines within a specified timeframe together with an agreement that regulation will be adopted if the target is not met ndash is also unlikely to be successful

76 Option 5 - Regulation

Regulation which requires a clear acknowledgement of a sufficient problem by Government places uniform mandatory compliance obligations on industry The costs associated with regulations are usually shared between government and industry with the development of regulations and program administration costs being borne by government with industry meeting compliance costs including emissions testing and if applicable labelling costs

It could argued that regulation should be introduced in the States or Territories where there are exceedances of the Air NEPM ozone standards However development of state based regulations for garden equipment engines emissions is unlikely as they would be incompatible with the 1992 Intergovernmental Agreement on the

40

Environment signed by the Commonwealth States and Territories and existing Commonwealth and State Government mutual recognition legislation The Intergovernmental Agreement on the Environment which underpins the development of National Environment Protection Measures obligates all jurisdictions to ensure equivalent protection from air pollution to all Australians

In addition enforcement of any state based legislation would be a key problem Under the Commonwealth Mutual Recognition Act 1992 and the Trans-Tasman Mutual Recognition Act 1997 goods that are imported into or produced in an Australian State or Territory or New Zealand that can be sold lawfully in that jurisdiction can be sold freely in a second jurisdiction even if the goods do not comply with the regulatory standards of the second jurisdiction This means non-regulated small engine products legally sold in one State could be legally sold in any other state regardless of whether emissions limits on small engines applied in that State

National regulation on the other hand would provide national consistency It would also provide the opportunity to adopt worldrsquos best practice standards and incorporate penalties for non-complying parties

Under the Australian Constitution the Commonwealth does not possess specific legislative powers in relation to the environment and heritage There are however a number of legislative powers that can support environment and heritage legislation Furthermore Commonwealth legislative powers can be used cumulatively For example the Commonwealth Parliament can make laws under section 51(20) of the Constitution with respect to ldquoforeign corporations and trading or financial corporations formed within the limits of the Commonwealthrdquo

Legislative mechanisms may also be created through the development of a National Environment Protection Measure (NEPM) that then becomes law within each jurisdiction A NEPM can accommodate flexibility of implementation where jurisdictions that have elevated ozone levels can tailor their NEPM program to their specific air quality needs An example of this flexible approach is the Diesel NEPM which has a suite of programs which can be implemented by jurisdictions

From the review of Australian regulations to reduce the environmental impacts of products and the overseas approaches to control emissions from small engines two regulatory approaches become apparent a simple benchmark or tiered benchmarks These are outlined below

Regulatory Option1 - A Simple Benchmark Approach

The most basic regulatory approach that could be taken would be to have a single emission standard (or as per the USA Europe and California a number of emission standards based on power and application) for combined HC + NOx emissions All equipment with new engines sold in Australia from the date the regulations are introduced This approach would

bull remove the all high emission engines from sale

41

bull be supported by an Australian Standard and

bull provide consumers with confidence that all products meet certain emissions standard

Regulatory Option 2 -Tiered Benchmarks

Current Australian directions to reduce the environmental impact of consumer products favour tiered benchmarks using a lsquostarrsquo rating system (see Appendix 2 for examples)

For engines used in garden equipment a tiered emissions labelling system could be based on the USEPA Phase 1 and Phase 2 standards use a system of lsquostarsrsquo to provide information to consumers about environmental performance but not limit consumer choice A tiered lsquostarrsquo system approach would

bull reward those products with more stars that meet the more stringent overseas standards

bull either operate with minimum emissions performance standards or disendorsement labels

bull be supported by a product label and possibly a web database

bull provide consumers emissions information and the option to purchase a lower emission engine

bull be supported by an Australian Standard and

bull be devised to meet worldrsquos best practice which is an overarching approach supported by Government

Table 16 summarises the main strengths and weaknesses of the above options

42

Table 16 Main Strengths and Weaknesses of Each Option

Strengths Weaknesses

Do Nothing Does not limit consumer choice Emissions contribution likely to grow No cost to government No barrier to new market entrants selling

high emitters Consumers have a wide choice of products Industry unchecked amp product dumping

likely No enforcement recourse on environmental grounds available

Partnerships Some sharing of responsibility government Slow if any reduction in high emitters

ndash industry

Potential for Government assist in Few if any companies likely to join and no advancing reductions in high emitters restrictions on non signatories Reduction targets set Below worldrsquos best practice

Quasi Regulation Similar strengths to partnership option Similar weaknesses to partnership option as

few if any companies likely to adopt code of practice

Co-Regulation Ongoing consultation between industry and Due to industry diversity targets unlikely to government recourse to regulation be met Targets set and can require new market Slow reduction in emissions entrants to achieve targets Can have implementation flexibility Emissions test standard adopted

Regulation Option 1- Simple Benchmark Worldrsquos best practice standards can be ovide incentives to manufacturers to promote low adapted and is mandatory emitters

Recourse to legal action available for non Does not provide consumers with emissions compliance information Significant quantifiable health benefits Cost of enforcement borne by taxpayers Requires compliance by all industry and High cost to government bans high emitters

Regulation Option 2 ndash Tiered Benchmarks Provides consumers with emissions information but does not limit choice Incentives for manufacturers to sell low emitters Potentially significant quantifiable health benefits Can be designed to overcome ABT issue

Significant administration and compliance costs to Government High cost to government and industry and will increase retail price of engines Does not ban high emitters

43

77 Preferred Approach

From the above discussion and from the review of garden equipment on available to the Australian consumer there are many companies selling powered garden equipment on the Australian market and the market is very competitive Furthermore from the Expert Panel discussions and stakeholder consultation it is apparent that it is highly unlikely that all the companies in the garden equipment industry would engage in or commit to a voluntary program to reduce their productsrsquo exhaust emissions It is therefore clear that the only feasible path to reduce emissions from these small engines is through regulation

While regulations of emissions from small engines used in garden equipment in Australia are likely to be based on overseas regulations they need to strike a balance between improved environmental outcome harmonisation with international standards and the characteristics of the local industry With regulation optimum emissions reductions are achievable especially by combining minimum emissions standards with tiered product labelling Whether this approach is justifiable on economic grounds that is the benefits outweigh the costs can only be determined through a detailed impact assessment Based on these findings it is recommended that a formal assessment of the costs and benefits of nationally regulating 2 and 4 stroke lawn mowers and handheld power equipment should now be commenced

44

References Air Resources Board California Environmental Protection Agency Californian Exhaust Emission Standards and Test Procedures for 2005 and Later Small Off-road Engines July 26 2004

Artcraft 2003 A Major Research-Based Review and Scoping of Future Directions for Appliance Efficiency Labels in Australia and NZ prepared for the Australian Greenhouse Office viewed at wwwenergyratinggovaulibraryindexhtml

Australian Bureau of Statistics 1999 Older People Australia A Social Report Report Number 41090 December 1999

Australian Greenhouse Office 2002 Achievements 2002 National Appliance equipment energy efficiency program Commonwealth of Australia

Australian Greenhouse Office 2002 Achievements 2002 National Appliance equipment energy efficiency program Commonwealth of Australia

AustralianNew Zealand StandardtradeASNZS 64002005 Water efficient productsmdashRating and labeling Federal Register of Legislative Instruments F2005L01571

Bei L T and Widdows R1999 Product knowledge and product involvement as moderators of the effects of information on purchase decisions a case study using the perfect information frontier approach Journal of Consumer Affairs 33(1) 165-186

Buy Recycled Busines Alliance Briefing Paper Environmental Claims And Labelling Abstract lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10-2003

California Code of Regulations 1998 Final Regulation Order Article 1 and Article 3 Chapter 9 Division 3 Title 13 Attachment 1 26 March 1998 wwwarbcagovregactsoreregs_finpdf

Canada Gazette Part II Vol 137 No 24 2003-11-19

Canadian Gazette 29 March 2003 Vol 137 No 13 Part 1 pp 935- 955

Cap Gemini Ernst amp Young (2001) Cars Online 2001 Global consumer survey httpa593gakamainet75931951a8b278a28319eawwwcgeycomhightechautomediaC ars_online2pdf

Clothes Washers Australiarsquos Standby Power Strategy 2002 ndash 2012 Standby Product Profile 200308 October 2003 wwwenergyratinggovau

Craig ndash Lees M Joy Sally Browne B 1995 Consumer Behaviour John Wiley amp Sons Queensland 1995

Department of Environment and Conservation NSW 2004 Measures to Encourage the Supply and Uptake of Cleaner Lawnmowers and Outdoor Handheld Equipment

45

Department of Environment and Conservation 2003 Who cares about the environment in 2003 A survey of NSW peoplersquos environmental knowledge attitudes and behaviours DEC Social Research Series

Department of Environment and Conservation Action for Air update 2006

Department of Environment and Conservation The Buy Recycled Guide Online Directory viewed at wwwresourcenswgovauindex-RNSWhtm

EcoRecycle 2004 Paint Take-Back Takes Off in Bayswater Media release 24 March 2004 viewed at wwwecorecyclevicgovau May 2004

Enviromower viewed at wwwenviromowercomau June 2004

Environment Canada 2000 Future Canadian Emission Standards for Vehicles and Engines and Standards for Reformulation of Petroleum Based Fuels Discussion Paper in Advance Notice of Intent by the Federal Minister of the Environment April 2000 wwwecgccaenergfuelsreportsfuture_fuelsfuture_fuels1_ehtm

Environment Canada 2004 Environment Minister Urges Canadians to Reduce Greenhouse Gas Emissions and Mow Down Pollution With Unique Incentive Program Media Release April 23 2004 viewed at wwwecgccamediaroomnewsrelease May 2004

Environment Protection and Heritage Council National Environment Protection (Ambient Air Quality) Measure Report on the Preliminary Work for the Review of the Ozone Standard October 2005

Environment Protection Authority 2006 Victoriarsquos Air Quality ndash 2005 Publication 1044 June 2006 wwwepavicgovau

Environmental Choice NZ 2001 Public Good and Environmental Labelling An Internal Background Paper

European Commission Directive 200344EC amending the recreational craft directive and comments to the directive combined 211005

George Wilkenfeld and Associates Pty Ltd with Artcraft Research and Energy Efficient Strategies Tomorrow Today 2003 Final Report A Mandatory Water Efficiency Labelling Scheme for Australia Prepared for Environment Australia June 2003

George Wilkenfeld and Associates 2003 A National Strategy for Consumer Product Resource Labelling in Australia prepared for the Australian Greenhouse Office December 2003 viewed at wwwenergyratinggovaulibraryindexhtml

Green Vehicle Guide wwwgreenvehicleguidegovau

Harrington L and Holt S 2002 Matching Worldrsquos Best Regulated Efficiency Standards ndash Australiarsquos success in adopting new refrigerator MEPS wwwenergyratinggovaulibrarypubsaceee-2002apdf

46

Harris J and Cole A 2003 The role for government in ecolabelling ndash on the scenes or behind the scenes lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10-2003

Holt S and Harrington L2003 Lessons learnt from Australiarsquos standards and labeling program Paper presented at ECEEE Summer Study - 2-6 June 2003 wwwenergyratinggovaulibraryindexhtml

IBIS 2006a Domestic Hardware Retailing 09-Jun-2006 Industry Code G523b

IBIS 2006b Gardening Services 18-Jan-2006 Industry Code Q9525

IBIS 2003 Gardening Services in Australia 23 December 2003 Industry Code Q9525

Lawrence K Zeise K amp Morgan P 2005 Management Options for Non-Road Engine Emissions in Urban Areas Consultancy report for Department for Environment amp Heritage Canberra

Motor Vehicle Environment Committee (MVEC) in consultation with the Department of Transport and Regional Services 2002 Proposal for an Australian ldquoGreen Vehiclesrdquo Guide viewed at httpwwwdotarsgovaumvegreen_vehicles_guidedoc May 2004

National Appliance and Equipment Energy Efficiency Committee The Energy Label at wwwenergyratinggovau (3504)

National Environment Protection Council 2005 National Environment Protection (Ambient Air Quality) Measure Report on the Preliminary Work for the Review of the Ozone Standard October 2005

National Environment Protection Council 1998 Final Impact Assessment for Ambient Air Quality National Environment Protection Measure June 1998

National Environment Protection Council 1999 Used Packaging Materials Impact Statement for the Draft NEPM Used Packaging Material January 1999 viewed at wwwephcgovau

National Environment Protection Council 2004 National Environment Protection (Air Toxics) Measure April 2004 viewed at wwwephcgovau

New South Wales Government 2002 Protection of the Environment Operations (Clean Air) Regulation 2002

New South Wales Government 1999 NSW Government Procurement Policy Statement White Paper 1999

Nordic Council 2002 Ecolabelling of marine Engines Criteria Document 8 December 1995 ndash 6 December 2005 version 35 December 2002

47

Office of Public Sector Information Statutory Instrument 2004 No 2034 The Non-Road Mobile Machinery (Emission of Gaseous and Particulate Pollutants) (Amendment) Regulations 2004 wwwopsigovuksisi200420042034htm

Outdoor Power Equipment Institute 2001 Profile of the Outdoor Power Equipment Industry wwwopeiorg

Productivity Commission 2004 The Private Cost Effectiveness of Improving Energy Efficiency Final report October 2005 wwwpcgovauinquiryenergy

Publishers National Environment Bureau Media Release lsquoAustralia leads the world in newspaper recyclingrsquo 6 June 2006 wwwpnebcomau

Real J Jones A 2005 The Green Vehicle Guide Clean Air Soceity of Australia and New Zealand Conference 2005 Hobart

Salmon G Voluntary Sustainability Standards and Labels (VSSLs) The Case for Fostering Them OECD Round Table On Sustainable Development

Schkade D A and Kelinmutz D N 1994 Information displays and choice processes differential effects of organization form and sequence Organizational Behavior and Human Decision Processes 57(3) 319-337

Stephens A 2003 Eco Buy (Local Government Buy Recycled Alliance Victoria) Abstract lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10shy2003

Teisl M F Roe B and Hicks RL 2002 Can eco-labels fine tune a market Evidence from dolphin-safe labeling Journal of Environmental Economics and Management 43339-359

Teisl M F Roe B and Levy A S Ecolabelling What does consumer science tell us about which strategies work pp141-150

The ISO 14000 family of standards guides and technical reports

The Parliament of the Commonwealth of Australia 2004 House of Representatives Water Efficiency Labelling and Standards Bill 2004 Explanatory Memorandum wwwcomlawgovauComLawLegislationBills1nsf viewed February 2006

Thogerson J 2000 Promoting green consumer behaviour with eco-labels Workshop on Education Information and Voluntary Measures in Environmental Protection National Academy of Sciences ndashNational Research Council Washington DC November 29-30

United States Environmental Protection Agency Federal Register Vol 60 No 127 3 July 1995 Control of Air Pollution Emission Standards for New Nonroad Spark-ignition Engines At or Below 19 Kilowatts wwwepagovEPA-AIR1995JulyDay-03prshy805txthtml

48

United States Environmental Protection Agency Federal Register Vol 69 No 7 12 January 2004 Rules and Regulations 40 CFR Part 90 Amendments to the Phase 2 Requirements for Spark-Ignition Nonroad Engines at or Below 19 Kilowatts Direct Final Rule and Proposed Rule wwwepagovfedrgstrEPA-AIR2004JanuaryDay-12a458pdf

United States Environmental Protection Agency Office of Pollution Prevention and Toxics Pollution Prevention Division 1998 Ecolabelling Environmental Labelling - A Comprehensive Review of Issues Policies and Practices Worldwide

United States Environmental Protection Agency Office of Transportation and Air Quality March 2000 Regulatory Announcement Final Phase 2 Standards for Spark-Ignition Handheld Engines

United States Environmental Protection Agency 1998 Proposed Phase 2 Emission Standards for Small SI Engines 27 January 1998

United States Environmental Protection Agency 2000 Regulatory announcement Final Phase 2 Standards for Small Spark-Ignition Handheld Engines March 2000 EPA420-F-00shy007

United States Federal Register Vol 69 No 7 Monday January 12 2004 Rules and Regulations Environmental Protection Agency 40 CFR Part 90 Amendments to the Phase 2 Requirements for Spark-Ignition Nonroad Engines at or Below 19 Kilowatts Direct Final Rule and Proposed Rule United States Federal Register Vol 64 No 60 30 March 1999 40 CFR Part 90 Phase 2 Emission Standards for New Nonroad Spark-Ignition Nonhandheld Engines At or Below 19 Kilowatts Final Rule pp15214-15216

United States Federal Register Vol 65 No 80 25 April 2000 40 CFR Parts 90 and 91 Phase 2 Emission Standards for New Nonroad Spark-Ignition Handheld Engines at or Below 19 Kilowatts and Minor Amendments to Emission Requirements Applicable to Small Spark-Ignition Engines and Marine Spark-Ignition Engines Final Rule pp24282-24284

United States Environmental Protection Agency Control of Air Pollution Emission for New Nonroad Spark-ignition Engines At or Below 19 Kilowatts Final Rule 40 CFR Parts 9 and 90 1995 wwwepagovEPA-AIR1995JulyDay-03pr-805txthtml

United States Environmental Protection Agency Office of Pollution Prevention and Toxics Pollution Prevention Division 1998 Ecolabelling Environmental Labeling- A Comprehensive Review of Issues Policies and Practices Worldwide

Victorian Government Greenhouse Strategy Community Action Fund - Mow Down Lawn Mower Rebate Exchange Program wwwgreenhousevicgovaucommunitygrantscafsuccessfulprojectshtm

Water Efficiency Labelling and Standards Act 2005 No 4 wwwcomlawgovauComLawLegislation

49

Water Efficiency Labelling and Standards Determination 2005 wwwcomlawgovauComLawLegislationLegislativeInstrument1nsf

Water Efficiency Labelling and Standards Regulations 2005 wwwcomlawgovauComLawLegislationLegislativeInstrument1nsf

Wilkie W 1994 Consumer Behaviour John Wiley and Sons NY as cited in Craig ndash Lees M Joy Sally Browne B 1995 Consumer Behaviour John Wiley amp Sons Queensland 1995

wwwenergyratinggovau

wwwgreenvehicleguidegovau

wwwwaterratinggovau

50

Appendix 1 Detailed Breakdown of Powered Garden Equipment on the Australian Market

The following table gives a profile of the current equipment on the Australian market It is based mostly on distributor responses to a survey and might not be representative of the total market

Low sales indicates that no sales data was available but volumes are likely to be small compared with popular equipment Phase 1 is US EPA Phase 1 or EU Directive 200288EU Phase 2 is US EPA Phase 2 or Euro standards

Type Ranges Stroke Aerator 5 makes 6 models Sales Low

Engine power 26 to 172kW Engine displ 143-674 ml

2c -4c 5 Unspecified 1 Phase 1 - Phase 2 4

Auger 3 makes 5 models Sales Low

Engine power 12 to 16kW Engine displ 31-ml

2c 5 4c -Unspecified -Phase 1 1 Phase 2 1

Backhoe 0 makes 0 model Sales Low

(2 models in 2003) -

Blower 13 makes 49 models Sales 109K

Engine power 07 to 31kW Engine displ 24-80ml

2c 34 4c 2 Unspecified 13 Phase 1 10 Phase 2 17

Blower-wheeler 3 makes 6 models

Engine power 07 to97kW Engine displ 24-305ml

2c 1 4c 4 Unspecified 1 Phase 1 3 Phase 2 -

Blowervac 6 makes 9 models Sales

Engine power 07 to 11kW Engine displ 24-34ml

2c 6 4c -Unspecified 3 Phase 1- Phase 2 3

Brush cutter 12 makes 95 models Sales 339K

Engine power 06 to 23kW Engine displ 21-54ml

2c 66 4c 5 Unspecified 24 Phase 1 15 Phase 2 34

Chainsaw 9 makes 106 models Sales 152K

Engine power 1 to 58kW Engine displ 26-122ml

2c 74 4c -Unspecified 32 Phase 1 18 Phase 2 27

Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

51

Type Ranges Stroke Clearing saw Engine power 14 to 27kW 2c 6 3 makes Engine displ 36-57ml 4c 0 9 models Unspecified 3 Sales low Phase 1 4 Phase 2 -Cultivator Engine power 07 to 52kW 2c 2 4 makes Engine displ 25-190ml 4c 5 7 models Unspecified -Sales low Phase 1 - Phase 2 5 De-thatcher Engine power 1kW 2c 1 1 makes Engine displ 27ml 4c -1 models Unspecified -Sales low Phase 1 - Phase 2 1 Drill Engine power 1kW 2c 3 3 makes Engine displ 27ml 4c -4 models Unspecified 1 Sales low Phase 1 - Phase 2 1 Edger Engine power 1 to 4kW 2c 12 10 makes Engine displ 24-190ml 4c 11 36 models Unspecified 1 Sales Phase 1 3 Phase 2 22 Garden tractor Engine power 12 to 157kW 2c -2 makes Engine displ 465 to 675ml 4c 5 12 models Unspecified 9 Sales low Phase 1 - Phase 2 3 Grass trimmer Engine power- 2c 3 1 make Engine displ 31ml 4c -3 model Unspecified -Sales Phase 1 - Phase 2 3 Hedge trimmer Engine power 06 to 1kW 2c 28 10 makes Engine displ 21-31ml 4c 1 42 models Unspecified 13 Sales 40K Phase 1 4 Phase 2 35 Lawnmower Engine power 26 to 66kW 2c 22 19 makes Engine displ 100-270ml 4c 151 183 models Price $449-$3609 Unspecified 10 Sales 424K Phase 1 95 Phase 2 48 Line trimmer Engine power 07 to 45kW 2c 25 8 makes Engine displ 24-195ml 4c 2 29 models Price $136-$299 Unspecified 2 Sales Phase 1 2 Phase 2 6 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

52

Type Ranges Stroke Log splitter Engine power 26 to 45kW 2c -1 makes Engine displ 100-195ml 4c 2 2 models Unspecified -Sales low Phase 1 - Phase 2 1 Multicutter Engine power 08 to 14kW 2c 17 5 makes Engine displ 23-36ml 4c 1 19 model Unspecified 1 Sales Phase 1 2 Phase 2 13 Olive nut shaker Engine power - 2c -1 make Engine displ - 4c -1 model Unspecified 1

Phase 1 - Phase 2 -Pole saw Engine power 08 to 14kW 2c 6 4 makes Engine displ 23-36ml 4c -10 models Unspecified 4 Sales low Phase 1 1 Phase 2 3 Power carrier Engine power 37 to 231kW 2c -2 makes Engine displ 160 to 953ml 4c 11 11 models Unspecified -Sales low Phase 1 - Phase 2 10 Power cutter Engine power 32 to 45kW 2c 5 2 makes Engine displ 64-99ml 4c -8 models Unspecified 3 Sales low Phase 1 1 Phase 2 3 Pruner (3 models in 2003) 2c -0 make 4c -0 models Unspecified -Sales low Ride-on-mower Engine power 26 to 231kW 2c -12 makes Engine displ 100 to 725ml 4c 93 124 models Unspecified81 Sales 51K Ph1 1 Ph2106 Rotary hoe (4 models in 2003) 2c -0 makes 4c -0 models Unspecified -Sales low Shredder Engine power 3 to 96kW 2c 1 6 makes Engine displ 126-389ml 4c 16 20 models Unspecified 3 Sales 46K Phase 1 - Phase 2 4 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

53

Type Ranges Stroke Stump grinder Engine power 96kW 2c -1 make Engine displ 389ml 4c 1 1 model Unspecified -Sales low Phase 1 - Phase 2 1 Tiller Engine power 08 to 59kW 2c -3 makes Engine displ 25-243ml 4c 8 9 models Unspecified 1 Sales low Phase 1 - Phase 2 7 Trencher Engine power37kW 2c -1 makes Engine displ 183ml 4c -1 models Unspecified 1 Sales low Phase 1 - Phase 2 1 Trimmer Engine power - 2c 10 2 makes Engine displ - 4c -21 models Price - Unspecified 11 Sales Phase 1 4 Phase 2 -Turfcutter Engine power 37kW 2c -1 makes Engine displ - 4c 1 1 models Unspecified -Sales low Phase 1 - Phase 2 -Vac Engine power 22 to 172kW 2c 1 5 makes Engine displ 158 to 674ml 4c 13 15 models Unspecified 1 Sales Ph11 Ph24 Vac chipper Engine power 34 to 45kW 2c -2 makes Engine displ 158-195ml 4c 3 3 models Unspecified -Sales low Phase 1 - Phase 2 1 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

54

Appendix 2 Examples of Current Australian Benchmarking Programs

The following describes in varying degrees of detail a number of current Australian benchmarking schemes classified by program type simple bench mark approaches tiered benchmarks and government industry partnerships This appendix concludes with a summary table of these programs with an assessment of their effectiveness

1 Introduction

Simple benchmark schemes (described below) such as the woodheater standards set a single point hurdle rate whereas the green vehicle guide use tiered benchmarks The new water efficiency labelling scheme and minimum energy efficiency performance standards uses both a simple benchmark through minimum performance requirement plus tiered benchmarks incorporated into labels as lsquostarsrsquo Other approaches such as the stand-by power program and the Victorian Altona Complex VOC reduction target set goals for achievement within a specified time period Other approaches taken to reduce environmental impacts include the National Packaging Covenant which uses a program based on individual companies developing tailored approaches to suit their circumstances and is supported by enforcement capability through the National Environment Protection (Used Packaging Materials) Measure (the NEPM)

2 Simple Benchmarks

21 Minimum Energy Performance Standards (MEPS)

Purpose

MEPS prescribe a minimum allowed energy performance for specific appliances Appliances that are less efficient than the relevant standard are excluded from the market

Background and Strategy

In October 1999 as part of the National Greenhouse Strategy (1998) nationally consistent MEPS and labelling schemes were adopted across Australia

Independent NATA accredited laboratories undertake product compliance checks to see whether products perform in compliance with MEPS requirements For example

bull In 2003 the government conducted check tests on eight appliance models all of which were found not to meet the claims made on the energy performance labels Two products were deregistered one was found to have not been registered and action was pending on the remaining five products (AGO 2003b)

55

bull Other regulatory actions undertaken in 2003 included fines of $3000 and $8000 against two Western Australian retailers who were found to have sold appliances without energy performance labels Queensland and Victorian retailers received infringement notices and fines totalling $10 000 (AGO 2003b)

Summary RegulNated minimum performance standards based on an Australian Standard

22 Energy Star

Purpose

An endorsement label that indicates an electronic product has achieved a specified standard when it is not performing its core function (ie on stand by)

Background and Strategy

Energy Star is a voluntary endorsement labelling program developed by the US Environmental Protection Agency (US EPA) It has been operating in the USA since 1992 and has been adopted by a number of countries including Australia Energy Star sets voluntary standards for reducing the electricity consumption of electronic equipment when it is not performing its core function

The Government stand ndash by program which is outlined below complements the energy star labelling program

Summary Voluntary endorsement label

23 Woodheater Standards

Purpose

To reduce particle emissions through Australian Standard compliant woodheaters

Background and Strategy

Since 1992 Australian StandardNew Zealand Standards have been introduced to improve the performance of wood heaters

The first standard for wood heater emissions AS4013 (1992) was published in 1992 and was revised and published as a joint AustralianNew Zealand Standard in 1999 ASNZS4013 (1999) Domestic solid fuel burning appliances - Method for determination of flue gas emission This Standard provides a test method to measure particles emitted by residential solid-fuel burning heating appliances

56

The 1992 Standard included an upper limit for acceptable particle emissions of 55 grams of particles per kilogram (oven-dry weight) of fuel burnt This emission factor was reduced to 4 gkg in the 1999 revision of the Standard The Standard applies to solid-fuel burning space-heating appliances (including those fitted with water heating devices) with a heat output of 25KW or less It does not apply to masonry fireplaces cooking stoves central heating appliances or water-heating-only appliances

AS 4013 (1999) is complemented by ASNZS4014 (1999) Domestic solid fuel burning appliances - Test Fuels and ASNZS4012 (1999) Domestic solid fuel burning appliances - Method for determination of power output and efficiency

The woodheater industry was instrumental in initiating the development of standards and it lobbied states and territories to enact legislation to mandating that woodheaters be required to meet the standards As the health affects of particle pollution have become more apparent and as some jurisdictions are having difficulty in meeting national particle standards Government has become more proactive in controlling woodheaters and more supportive of tighter standards

All states and territories with the exception of South Australia have regulations that restrict emissions from new woodheaters although Victoria for example only introduced its regulations in 2004 compared to Tasmania who introduced regulations in 1993 These regulations require that new woodheaters comply with the Australian Standard ASNZS 4013 The State regulations however are not uniform

Many woodheaters that are currently certified for sale do not comply with the revised standard as verified in a National Woodheater Audit Program undertaken in 2004 Seven of the 12 wood heaters tested failed to meet the ASNZS 4013 particle emission limit In addition 55 of heaters were found to have deviations from the original designs and 72 had labelling faults that could adversely affect emissions performance

Testing and certification are administered by the industry association

Summary State and regulations requiring compliance with Australian Standards Certification administered by industry association

24 Standby Power

Purpose

To reduce lsquoexcessiversquo energy consumed in electrical appliance standby mode sold in Australia through in the first instance voluntary targets Appliances covered by the program range from information technology equipment such as PCs and photocopiers entertainment equipment such as TVs DVDs and sound systems major appliances such as water heaters dishwashers and refrigerators and small appliances such as smoke detectors and bread makers

57

Background and Strategy

In 2000 standby power was estimated to constitute 116 per cent of Australiarsquos residential energy use costing households over $500 million and leading to the emission of over 5 million tonnes of carbon dioxide equivalent (AGO 2002c) Holt and Harrington (2004) estimated that standby power consumption in Australia could be reduced by 56 per cent by 2020 (Productivity Commission 2005)

In August 2000 all Australian jurisdictions agreed to pursue efficiencies in standby power consumption of energy-consuming products through support for the International Energy Agencys One -Watt program and endorse its incorporation into theprogram of work

Australia reportedly has taken the lead on implementing the One- Watt program even though many of the products sold in Australia are imported

During 2002 government agencies consulted with stakeholders about ideas to reduce standby The standby strategy which proposed a list of targeted potential product types was presented to the Ministerial Council on Energy

In September 2003 an interim test method for the measurement of standby power ASNZS 62301-2003 (int) based on an internationally recognised standard was published Also during this period work commenced on developing draft product profiles for high priority targeted products

Once product profiles are completed interim voluntary date-specific targets are made The product sales are then monitored to determine progress towards the interim target If it is then determined that inadequate progress is being achieved by a significant number of suppliers then government will regulate

For example the interim 2007 target for clothes washers is as follows

Product Off mode power End of program mode

lt 1W lt 4 W

The National Standby Strategy Target to be achieved by 2012 for clothes washers is as follows

Off mode power End of program mode lt 03 W lt 1 W

In support of the clothes washer program Government will

bull consider creating a Government Purchasing Policy to buy low standby clothes washers where available and fit for purpose

bull collect data on all modes for new clothes washers and analyse trends

bull highlight the range of performances by publishing performance data on clothes washers on a website or by other means

58

bull progressively include standby energy consumption into the Comparative Energy Consumption for labelled products such as clothes washers and clothes dryers

bull work with the Standards Committees to finalise the details of modes and test methods for the relevant standards

bull determine in 2008 if progress is inadequate and if regulation is required

Summary Industry targets possible future regulation

3 Tiered Benchmarks

31 Mandatory Energy Efficiency Label ndash the Energy Star Programs

Purpose

To enable consumers to easily compare the energy performance of electrical appliances used by households and firms through a labelling scheme

Background and Strategy

Several Australian states commenced mandatory energy efficiency labelling for major appliances in the mid-1980s In 1992 it became mandatory across Australia for initially refrigerators and later freezers clothes washers clothes dryers dishwashers and air-conditioners (single phase only) to carry the label when they are offered for sale This labelling program is regarded as one of the most successful in the world (Wilkenfeld and Assoc 2003) It is administered through the Australian Greenhouse Office

The energy rating label for dishwashers

(ldquoa joint government and industry programrdquo) and a website address (wwwenergyratinggovau) and has two main features

bull the star rating which gives a quick comparative assessment of the models energy efficiency and

bull the comparative energy consumption (usually kilowatt hoursyear) which provides an estimate of the annual energy consumption of the appliance based on the tested energy consumption and information about the typical use of the appliance in the home These values are measured under Australian Standards which define test procedures for measuring energy consumption and minimum energy performance criteria Appliances must meet these criteria before they can be granted an Energy Rating Label

The Energy Rating Label includes an endorsement

59

Awards Brand ModelInstallat

ionType

Phase Available

10 Yr Energy

Cost StarRating

Output(kW)

TOSHIBA

Digital Inverter Series Air

Conditioner RAV-SM1102BT-

ERAV-SP1102AT-E (

RAV-SM1102BT-ERAV-

SP1102AT-E)

SingleSplit

SystemDucted

Single $1500 1000

CHUNLAN

KFR-32GWVWa (

NO)

SingleSplit

SystemDucted

Single $645 323

Since its introduction the star rating label seems to have established a high level of recognition with consumers Consumer research (Artcraft 2003) indicates that the different information on the label appeals to different consumer segments interested in purchasing an appliance

When a manufacturer gains approval to use the label they pay for and produce the label in accordance with specifications on size colours fonts layout and design A similar colour scheme and design to the energy consumption label is also used for the compulsory fuel consumption label on new passenger and light commercial vehicles

The labelling scheme is underpinned by regulation whereby regulated Minimum Energy Performance Standards (MEPS) provide the environmental benchmarks that the appliances are required to meet Appliances that do not meet the minimum energy performance standards can be withdrawn from the Australian market

When the energy rating program was reviewed in 2000 technology had advanced to the point where a large percentage of appliances had achieved the maximum number of stars so the rating system was tightened It is estimated that over the 25 year period 1980 to 2005 there will have been an overall reduction in energy consumption of around 70 by the most popular sized refrigerators (with freezers) (Harrington L and Holt S 2002)

In addition to the energy consumption label there is a website (wwwenergyratinggovau) with a comprehensive database of all appliances their star rating and energy consumption In 2002 there were around 220000 hits on the programrsquos various websites and 523000 in 2003 reportedly representing 80000 visits by individual inquirers The website hit rate is estimated to represent almost 10 of consumers who are considering purchasing an appliance (Holt et al 2003)

Cooling

Energy Input (kW)

250

104

Figure B Excerpt from Energy Rating web page for Air Conditioners (cooling cycle only shown)

When the energy rating program was reviewed in 2000 technology had advanced to the point where the Scheme had to be tightened because a large percentage of appliances had achieved the maximum number of stars For example energy use by refrigerators was around 70 compared to that used when the scheme started (Harrington L and Holt S 2002)

60

Regulations

State and Territory legislation refer to the relevant Australian Standards This approach simplifies the State and Territory legislation and makes it relatively straightforward to maintain national consistency of appliance and equipment energy efficiency standards even when standards are continually being revised

The testing procedures and technical requirements for the label and also Minimum Energy Performance Standards (MEPS see below) are incorporated into the applicable Australian Standards Products for sale must be registered with one of the State regulators

Program Administration

The labelling program and MEPS program are administered by the National Appliance and Equipment Energy Efficiency Committee (NAEEEC) which is ultimately directed by the Ministerial Council on Energy

Requirements for Appliance Suppliers

Appliance suppliers are required to

bull Submit applications for product registration and these must include a test report or other data to demonstrate that the appliance meets the relevant Australian Standard

bull While test reports on three separate units are required for most products there is no particular requirement for test laboratories to be accredited or products certified for registration for energy labelling and MEPS in Australia Test reports from the manufacturers laboratory are satisfactory However if there is evidence that results from a particular laboratory are unsatisfactory regulators can mandate test reports from an accredited laboratory

Summary Mandatory labelling scheme backed by regulations and an Australian Standard

32 Water Appliances Water Efficiency Labelling and Standards (WELS) Scheme

Purpose

A labelling scheme backed by legislation to promote domestic water efficient appliances

Background and Strategy

A voluntary water efficiency industry administered labelling scheme has been in existence since 1988 The water efficiency ratings and details on the label design are covered in ASNZS 6400 The main incentive of the voluntary lsquoAAAAArsquo scheme

61

has been the publicity and cash rebates offered by water utilities However the coverage water efficiency performance requirements and impact of this program have been limited

In 2003 the Environment and Heritage Ministers agreed to implement a national Water Efficiency Labelling Scheme (WELS) for products such as shower heads washing machines dishwashers and toilets Consultation with industry and stakeholders was undertaken in 2003 with a strategic study published that identified the products to be included in the new labelling Scheme A Regulation Impact Statement (RIS) which identified the costs and benefits of various options and made various recommendations was published in March 2004 Following public review of the RIS some modifications were made to WELS

The WELS Scheme is backed by the following legislation and standard

Water Efficiency Labelling and Standards Act 2005 which establishes

bull the products subject to the Scheme and the requirements for registration and labelling

bull the standards to apply to WELS products setting requirements for water efficiency performance registration and labelling of these products

bull enforcement provisions including penalties bull the appointment of inspectors to investigate possible contraventions and sets

out their powers and obligations bull review and dispute resolution bull a program Regulator bull the making of regulations bull a requirement for annual reports and for an independent review after five years

Water Efficiency Labelling and Standards Regulations 2005 which

bull prescribes the circumstances in which a person other than the manufacturer of a WELS product may be taken to be the manufacturer of the product (eg an importer)

bull sets out procedures for the issuing and the payment of penalty infringement notices as an alternative to prosecution for offences against the WELS Act

bull specifying the information to be included on an identity card issued to a WELS inspector

Water Efficiency Labelling and Standards Determination 2005 amongst other things determines and establishes product registration fees and calls up the Australian Standard ASNZS6400 2005 Water-efficient products - Rating and labelling which

bull defines the products

bull specifies the assessment procedures (ie identifies test procedures in other Australian Standards)

bull provides the formulas to give products their star rating

bull specifies the labels and their application to products

62

Approximately twenty organisations were represented on the Standards Committee that developed the Standard

State and Territory legislation

The States and Territories have also enacted or agreed to enact complementary legislation to ensure that the WELS Scheme has comprehensive national coverage State and Territory legislation which is almost a mirror of the Commonwealthrsquos Water Efficiency Labelling and Standards Act 2005 enables the States and Territories to for example undertake certain responsibilities delegated to them by the Commonwealth Regulator appoint their own inspectors and enforce the WELS

Other features of WELS include

bull A product web database

bull With the exception of toilets no other products are required to meet mandatory water efficiency requirements (WES) but this may change over time The introduction of mandatory WES means that products not meeting the minimum performance requirements can not legally be sold

bull Products must be tested in accordance with the relevant Standard and must meet any minimum performance and water efficiency requirements in the Standard before they can be granted a WELS Water Rating label

bull It is up to manufacturers or their agents (eg importers in the case of imported products) to ensure that their products are correctly registered and labelled and comply with any other requirements of the Standard

There is a transition phase which gives manufacturers and importers time to test register and label products and to sell pre-existing stock From 1 January 2008 all products are required to display the WELS Water Rating labels irrespective of their date of supply

63

The WELS Water Rating label

Label Features

bull A star rating for a quick comparative assessment of the models water efficiency

bull Labels with 1 to 6 stars

bull Some products may also be labelled with a Zero Star Rated label which indicates that the product is either not water efficient or does not meet basic performance requirements

bull A productrsquos water consumption figure

bull There are provisions for swing tags if there is inadequate surface area for label or the item is likely to be marked by sticking the label on the product

Summary Mandated product labelling using lsquostarrsquo rating system Has a disendorsement label and has provisions to ban products

33 Gas Appliance Rating Scheme

Purpose

A gas labelling program to improve the energy efficiency of gas powered products

Background and Strategy

The Gas and Fuel Corporation of Victoria introduced energy labelling for gas water heaters in 1981 This scheme was taken over by the AGA in 1985 who in 1988 introduced a six star energy performance label This label was intended to be visually consistent with the star rating labels already familiar to consumers of electrical appliances

The labelling scheme is currently voluntary and still administered by the industry body

A range of gas appliances have been subject to minimum energy performance standards (MEPS) since the 1960s The current MEPS levels were set in 1983 and

64

Brand Model Type MjyearStar

RatingSRI

StorageCapacity

(ltrs)IndoorOutdoor

NaturalGas

Instantaneous 18969 59 I N

Instantaneous 18969 59 I N

lsquothe majority of models currently on the market appear to exceed current requirements by a comfortable marginrsquo (SEAV 2003 p 23)

The gas energy labels are similar in format to those found on electrical appliances except they are blue and show annual energy use in MJ

A trial web site listing gas water heaters available in Australia is also available (see below)

Bottle Gas

Rinnai Infinity

V Series

REU-V2632FFU-A (Infinity 26 plus internal) P

Rinnai Infinity

V Series

REU-V2632FFUC-A (HD2001 internal) P

A joint review of the scheme is under way by the Gas Industry and Governments and regulation is under consideration A three year work plan has been published under the Australian and New Zealand Appliance and Equipment Energy Efficiency Program

Summary Currently voluntary labelling using lsquostarrsquo rating system with mandatory minimum energy performance standards Future regulation is under consideration

34 Green Vehicle Guide

Purpose

To provide web-based comparable and accessible environmental data on new motor vehicles

Background and strategy

65

The Commonwealth government started publishing a booklet of fuel consumption data for new passenger and light commercial vehicles in the early 1980s and a low cost web database in more recent years

In 2004 the Government through the Department of Transport and Regional Services (DOTARS) expanded the fuel consumption guide into the Green Vehicle Guide The Green Vehicle Guide is a web based database that rates new passenger and light commercial vehicles on air pollution greenhouse emissions and fuel consumption and gives an overall lsquostarrsquo rating for each vehicle within each vehicle category (small medium luxury sports etc)

The data on which the scores are derived are provided voluntarily by the vehicle manufacturers however this data is based on mandatory Australian Design Rule certification test data

The Guide uses a 5 star rating system however it also assigns half stars resulting in a total of 10 levels

The Greenhouse Ratings are based on carbon dioxide emissions and the Air Pollution Ratings take into account the relative environmental impact of oxides of nitrogen hydrocarbons and particles The relative harmfulness of the pollutants (shown in table below) has been quantified based on the allowable concentrations under the Ambient Air Quality National Environment Protection Measure (NEPM)

Green Vehicle Guide Weighting of Regulated Vehicle Emissions

Vehicle Emission

(equivalent pollutant under Air NEPM)

Calculated

Relative

Harmfulness

Final

Weighting

Carbon Monoxide (CO) 0088 Not included

Oxides of Nitrogen (NOx) (based on

Nitrogen Dioxide)

4 1

Hydrocarbons (HC) (based on

photochemical oxidants as ozone)

5 1

Particulate Matter (PM) (based on PM10) 20 5

Source Real and Jones 2005

NOx and HC were given equal final weightings despite the slight difference in the calculated relative harmfulness primarily because under ADR7900 a combined HC+NOx limit is prescribed rather than individual limits for each pollutant

The higher weighting for particulate matter recognises its significant health impacts The Air Pollution rating scale was devised in such a way that a lsquotypicalrsquo car (that is most petrol engined passenger cars meeting the current emission standard at the time) receives a mid-point rating (5 out of 10)

66

The overall rating or stars is derived from the sum of the air pollution and greenhouse scores ie they are equally weighted

Development of the Green Vehicle Guide (see extract below) involved extensive consultation with vehicle manufacturers

Website Costs

The new highly automated web database which contains data on approximately 1400 vehicles and has sophisticated search facilities cost approximately $200000 to develop plus around $100000 was spent recently to improve the sitersquos usability This compares to the previous low cost database which together with the printed guide cost less than about $80000 per annum The low cost version lacked the automation was only updated annually and did not have the ability to compared vehicles

The manufacturers provide the data on line using special access codes This data is checked by DOTARS before it is uploaded onto the website It takes close to a full time position within DOTARS to administer the website and respond to website related queries

Market Research and Marketing

Before the new greenvehicleguidegovau website was launched DOTARS commissioned consumer surveys to determine the level of knowledge about the environmental impacts made by vehicles This research showed that around half of those surveyed had the belief that ldquoall new cars have the same level of impact on the environmentrdquo

It became apparent through the surveys that there was a need to provide consumers with meaningful information on the relative performance of different vehicles This was a view shared by the Productivity Commission who said that while markets provide extensive information to consumers regarding fuel consumption of motor vehicles ldquothe Australian Governmentrsquos Fuel Consumption Labelling Scheme and Green Vehicle Guide provide relatively low cost accessible and comparable information to consumers and may be justified as part of the more fundamental objective of encouraging consumers to reduce the adverse environmental impacts of motor vehicle userdquo The Productivity Commission also commented that government

67

sources of information of this type were seen as credible and reliable and held in higher regard than information provided by others

DOTARS has scheduled some follow up consumer research for 200062007

DOTARS has spent about $600000 in marketing the Green Vehicle Guide This has included advertising in weekend guides in newspapers developing facts sheets plus targeted marketing to motor vehicle journalists

Summary Website - voluntary but legislative base

4 Government-Industry Partnership programs

Government-Industry Partnerships are the basis of many environmental initiatives and can take a number of forms Industry and government negotiate the terms of the program which are normally detailed in a formal agreement which sets out the environmental objectives and the responsibilities of each party towards their achievement

The GovernmentIndustry Partnership programs outlined below indicate the varied nature of these initiatives

41 The National Packaging Covenant

The National Packaging Covenant (the Covenant) commenced in 1999 and is a voluntary agreement between all levels of government and companies throughout the packaging chain including raw material suppliers packaging producers and retailers The Covenant commits signatories to the implementation of best practice environmental management in areas such as packaging design production and distribution and research into life cycle issues Signatories to the Covenant produce action plans on the measures they will implement to reduce packaging waste and they report annually on their progress In this sense the Covenant provides flexibility to signatories to develop plans suitable to their own circumstances The Covenantrsquos success (it currently has over 600 signatories) is due to the active promotion of it by Government and key industry players

The Covenant is complemented by a regulation the National Environment Protection (Used Packaging Materials) Measure (the NEPM) which enables states and territories to use enforcement action to require companies that donrsquot sign the agreement to take steps to reduce their packaging waste Preceding the Covenant and the NEPM were a number of voluntary industry agreements but these were limited in scope and largely focused on companies in the beverage industry

42 National Industry Reduction Agreement

The Publishers National Environment Bureau (PNEB) was formed in 1990 as an association of the major publishers of newspapers and magazines in Australia to promote the recovery and recycling of old newspapers and old magazines primarily from community kerbside collections organised by local councils

68

The PNEB and a newsprint manufacturer have voluntarily entered into a series of five-year Industry Waste Reduction Agreements with the Commonwealth and State Governments Under the current (third) plan 2001-2005 newsprint recycling in Australia has grown to 754 nationally in 2005 from the 28 level when the PNEB was formed in 1990

43 StateLocal target based programs

There have been a number of agreements signed by state government departments and an industry group where there is a stated goal to reach a specific environmental target For example in the early 1990s there was a voluntary agreement with the EPA Victoria and companies in the Altona Chemical Complex in the western suburbs of Melbourne (which includes Australian Vinyls BASF Dow Chemicals and Qenos) to reduce hydrocarbon emissions by 50 within a specified timeframe The target was met and further emissions reductions were negotiated The NSW EPA-Oil industry petrol volatility agreement outlined below is another example of a target based program

44 NSW EPA-Oil Industry Memorandum of Understanding on Summer Petrol Volatility

In 1998 NSW established arrangements for the supply of low volatility petrol in summer in the Sydney Greater Metropolitan Region implemented through a Memorandum of Understanding between the then EPA and oil companies The principal reason for controlling petrol volatility in summer is to reduce evaporative emissions of VOCs (from vehicles and production and storage sites) which contribute to ozone formation

The Memorandum of Understanding operated over four summer periods from 1998 to 2002 and involved companies voluntarily reducing petrol volatility (measured in kilopascals (kPa) of vapour pressure) over three summer periods from a base of 76kPa to 70kPa in the first summer 67kPa in the second and 62 kPa in the last two years

Although the Memorandum of Understanding was successful in progressively reducing petrol volatility over the period of its operation it was not supported by all industry members Consequently agreement was reached with industry that summer petrol volatility limits should be regulated to ensure a level playing field for all industry participants and regulated limits will apply from the summer of 200405

69

5 Summary of Australian Benchmark Programs

Program National State

Summary of Approach Impact

Voluntary Programs Altona Chemical Complex (Vic)

Local Small industry group worked towards self determined targets

Very high

Energy Star National Standards based label Limited Gas appliance Rating Scheme

National Industry operated labelling scheme with stars assigned therefore has graded benchmarksminimum performance standards out dated web database being developed

Low

National Industry Reduction Agreement

National Small industry group worked towards negotiated targets

High

NSW EPA-Oil Industry MOU

State Small industry group worked towards negotiated targets but not all involved ndash lead to regulations

Moderate

Top Energy Saver Award

National Achievement based label Limited

Quasi Regulatory Green Vehicle Guide

National Well promoted web database star ratings assigned therefore has graded benchmarks data provided voluntarily but backed by ADR requirements

High

Stand-by power National Required to achieve voluntary targets or regulation will be introduced

Unknown

National Packaging Covent

National Performance based targets backed by legislation High

Regulatory Energy Efficiency Labels

National Labelling scheme with stars assigned therefore has graded benchmarksbased on Australian Standard web database

High

MEPS National Sets base benchmark and works with energy rating

High

WELS Scheme National Labelling scheme with stars assigned therefore has graded benchmarksbased on Australian Standardweb database

High

Wood heaters State Only one benchmark assigned regulations are not uniform

Moderate

authorrsquos assessment based on direct or indirect knowledge of these programs

70

Appendix 3 Productivity Commission Comments on Labelling and Minimum Performance Standards

The Productivity Commission an independent agency which is the Australian Governmentrsquos principal review and advisory body on microeconomic policy and regulation recently examined the cost effectiveness of improving energy efficiency As part of its review lsquoThe Private Cost Effectiveness of Improving Energy Efficiencyrsquo it examined labelling programs minimum mandatory energy efficiency requirements and other means of providing consumer information The final report contains some highly relevant material that is applicable to establishing a benchmarking scheme for small engines

The following is a summary of relevant conclusions from the Inquiry

Government Operated Labelling Schemes

From consumer research provided to the Commission it concluded that ldquothere is some evidence to suggest that consumers are now paying more attention to labels than they have in the pastrdquo

The Commission was positive about labelling programs as labels

bull directly address ldquoa source of market failure mdash the asymmetry of information between buyers and sellers of energy-using productsrdquo

bull provide information to the consumer that is readily-accessible and easily-understood and therefore can assist in helping the consumer make better-informed choices

bull are likely to have produced net benefits for consumers

bull do not directly limit consumer choice

bull could provide a greater incentive for suppliers to sell products that use energy cost effectively

bull probably produced net social benefits

bull are most suited where there is a wide spread in the range of performances of comparable appliances and where information failures are most pronouncedrdquo

bull can be used to warn consumers that an appliance is very inefficient (through a disendorsement label) which could be effective in discouraging but not preventing consumers from buying the poor performing product

The Commission was supportive of Governmentrsquos role of drawing together and packaging information through labelling programs as this ensures that ldquorelevant and trusted information gets to those who would otherwise not get itrdquo In material reviewed by the Commission George Wilkenfeld and Associates and Energy Efficient Strategies (1999) claimed that labelling is unlikely to be effective if purchasers rarely inspect appliances in a showroom where they can compare performance across

71

different models or the purchaser is not the ultimate user and so has little interest in operating costs

Labelling programs involves both administration and compliance costs such as those incurred by suppliers in having their products tested but the Commission considered that labels should be more actively considered as an alternative to minimum performance standards

Minimum Performance Standards

Governments can prevent the sale of inefficient products by using minimum standards for example the Minimum Energy Performance Standards (MEPS) that apply to appliances such as refrigerators and freezers air conditioners and electric water heaters If appliances do not meet the minimum standard they cannot be sold in Australia Some appliances are covered by both MEPS and by labelling (for example refrigerators)

The Commission considered that MEPS and labels can be complementary as MEPS act to penalise the worst energy performers whereas labels rewarding the better performers

Costs comparisons of schemes

The Department of the Environment and Water Resources provided details about the costs involved in administering both the labelling scheme and the minimum performance standards for energy programs It stated that

bull the administration costs of MEPS are substantially lower than for labelling but the compliance costs can be higher

bull MEPS can have a greater cost for suppliers than labelling since suppliers must adjust their model ranges to meet the MEPS levels by the given date These compliance costs are however influenced by the lsquolead inrsquo time between the introduction of the regulatory proposal and the implementation of the MEPS

bull it is estimated that the administration costs for MEPS would be $3 million over the period 2000ndash15 compared to $39 million for labelling (in present value terms) (George Wilkenfeld and Associates and Energy Efficient Strategies 1999) Furthermore it was assumed that 84 per cent of administration costs were borne by appliance purchasers with the remainder borne by governments

It estimated that MEPS would increase the cost of appliances by $266 million over 2000ndash15 compared to $688 million for labelling (the latter cost being due to consumers voluntarily purchasing more efficient appliances)

72

Page 8: Outdoor Garden Equipment - Department of the Environment

Based on estimates made using the National Pollutant Inventory database engines used in lawn mowers contribute approximately 4 on average to VOC emissions from anthropogenic sources in major airsheds in Australia when public open space lawn mowing is included This is likely to rise to around 11 in the warmer spring and autumn weekends which is when lawns and other vegetation grows faster and when gardening is more popular The NPI does not take into account emissions from other types of powered outdoor equipment

The Australian Market

According to the Outdoor Power Equipment Association (OPEA) approximately 424000 walk behind lawnmowers and more than 792000 units of outdoor handheld equipment were sold in Australia in 2005-06 In addition there were sales of about 80000 replacement engines and 70000 pumps in 2005-06 most of which were four strokes The general household consumer represents the major market segment for garden equipment accounting for up to 90 of product sales with commercial garden services and government purchasing the rest

Indications are that sales of imported high polluting two stroke engines have increased over the last few years and it appears that the price of some powered garden equipment has dropped to the level where consumers regard them as disposables

An assessment of outdoor equipment on the Australian market found that the majority of small engines sold in Australia are imported and many come from countries that impose emission limits The extent of imports into Australia that do not comply with the country of origin standards is not known However the industry estimate that 40 of garden products are sold through importers who are not linked to manufacturers of US EPA or European certified equipment and the source of some products sold here is difficult to establish Victa is the only company producing small engines in Australia Its iconic 2-stroke lawn mower engine currently does not meet overseas emission limits for non-handheld equipment and Victa is undertaking research and development to reduce emissions from its two stroke engine to meet US and European standards

In spite of several attempts to obtain data on compliance with overseas emission standards from Australian distributors their response was poor The following figure therefore provides a best estimate of expected compliance of outdoor equipment on the Australian market with European CARB or USEPA requirements applicable in 2004

iv

Figure E1 Compliance with overseas standards for popular categories ldquoPhase 1 equivrdquo means the engine complies with US EPA phase 1 or 200288EU ldquoPhase 2 equivrdquo means the engine complies with US EPA Phase 2 Euro I or Euro 2 ldquoUnknown means that engine cycle (stroke) was not provided

Measures to Increase Sales of Low Emission Garden Equipment Engines

There is a range of options that could be considered for reducing emissions from engines used in outdoor garden equipment engines in Australia These include

1 Maintaining the Status Quo

2 Government ndash Industry Partnership Program

3 Quasi regulation

4 Co-regulation

5 Regulations based on either a simple benchmark or tiered benchmarks

The Small Engine Expert Panel ndashOutdoor Equipment has considered in depth the most appropriate approach to take to improve the emissions performance of outdoor garden equipment sold in Australia It recommends the introduction of national regulations to control the emissions from outdoor garden equipment particularly in light of the increase in cheap imports onto the Australian market which although untested are considered very likely to have high emission levels The Expert Panel has developed some broad recommendation on which Australian regulations could be based which takes in consideration the local market and Victa These are summarised as follows

1 Mandatory air pollutant emission standards to be introduced in Australia for all outdoor equipment (lt19kW) powered by spark-ignition engines

v

The development of any regulation would need to be based on a formal assessment of the costs and benefits of nationally regulating two and four stroke lawn mowers and handheld power equipment which should commence immediately

2 Proposed standards to mirror US EPA regulations (compliance with equivalent EU regulations also acceptable)

3 Timing (subject to completion of assessment of costs and benefits)

(a) US EPA Phase 1 ndash Effective from 20072008

(b) US EPA Phase 2 ndash Fully implemented in 2012 (in step with 2007 USEPA limits) plus a phase-in period andor provisions for averaging banking and trading (ABT) of emissions over 2008-2012 to provide for early introduction of cleaner product

The US EPA Phase 1 and Phase two emissions limits are given in the table below

4 Walk-behind two stroke mowers to be included in US EPA Category 5 (gt50cc) product classifications (to provide Victa time to develop a cleaner engine) Implementation timing is proposed to be the same as Recommendation 3 above

5 All products also to be certified to relevant EPA product durability categories

6 Subject to further review ABT if included may be phased out after 2012

Table E1 Comparison between the USA Phase 1 and Phase 2 standards

Emission Limits GkW-hr

Phase 1 (1997 ndash2001) Phase 2 (2007) HC NOx HC+NOx CO HC+NOx CO

Non-handheld

I-A lt66cc 161 161 610

I-B 66-lt100cc 161 161 610

I 100-225 cm3 161 519 161 610

II 225 cm3 134 519 121 610

Handheld

III lt20 cm3 295 536 805 50 805

IV 20-50 cm3 241 536 805 50 805

V 50 cm3 161 536 603 72 603 Phase 2 limits were phased in between 2002 -2007 during which time they became tighter

For simplicity only the 2007 are shown in this table (see Table 2 for more details)

vi

Conclusion

From this review it is apparent that it is highly unlikely that the companies in the industry would engage in or commit to any voluntary type program It is therefore clear that the most expedient path to reduce emissions from these small engines is through national regulation State based regulations could only provide a piecemeal approach that would lead to product dumping in states where there are no regulations and inconsistent regulations that require industry to treat each state market differently In addition enforcement of any state based regulations would be a key problem due to existing Commonwealth and State Government mutual recognition legislation

While any national regulation of emissions from small engines used in garden equipment in Australia are likely to be based on overseas regulations they need to strike a balance between improved environmental outcome harmonisation with international standards and the characteristics of the local industry With regulations optimum emissions reduction are potentially achievable by combining minimum emissions standards with tiered product labelling Whether this approach is justifiable on economic grounds that is the benefits outweigh the costs can only be determined through a detailed impact assessment Based on these findings it is recommended that a formal assessment of the costs and benefits of nationally regulating two and four stroke lawn mowers and handheld power equipment should be commenced

vii

1 Introduction

This report sets out the results of a project to compare and benchmark emissions from engines used in outdoor garden equipment that were available for sale in Australia during 2006 Possible outcomes from the project range from consumer guidelines for selecting low emission engines to regulatory controls on emissions There are currently no state or national regulations that directly control emissions from these engines

The project was commissioned by the Commonwealth Department of the Environment and Water Resources on behalf of state and territory government departments working on reducing the impacts of small engine emissions This report was prepared in consultation with an Expert Panel that included representatives from the Outdoor Power Equipment Association (OPEA)

11 Emissions from outdoor garden equipment engines

Small engines particularly conventional two stroke engines used in applications such as outdoor garden equipment are high polluters relative to their engine size and usage1 These small engines emit volatile organic compounds (VOCs) and oxides of nitrogen (NOx) which contribute to ozone (photochemical smog) formation in summer They also emit particles carbon monoxide (CO) and a range of air toxics such as benzene The USA California Canada and Europe and regulate emissions of VOCs NOx carbon monoxide and particle emissions from outdoor garden equipment

There are five types of spark-ignition engines that can be used in outdoor garden equipment

bull two stroke with carburettor (2c)

bull two stroke with pre-chamber fuel injection (2i)

bull two stroke with direct fuel injection (2di)

bull four stroke with carburettor (4c)

bull four stroke with fuel injection (4i) (includes direct injection)

Carburettor and pre-chamber fuel injection two stroke engines are inherently more polluting than the other three types This is due to their inability to completely separate the inlet gases from the exhaust gases resulting in up to 30 of the fuel being left unburnt and the need to add oil to the fuel to lubricate the engine (four stroke engines have separate reservoirs for fuel and oil) However twostroke carburettor engines typically weigh less than a four stroke engine of the same power and this tends to make them attractive for handheld equipment They also tend to have fewer components are generally cheaper to purchase and are cheaper to maintain than

1 Outdoor equipment covered in this report are engines less than 19kW

1

four stroke motors Victa Lawncare is currently undertaking research and development to improve the environmental performance of two stroke carburettors and while some emission improvements have been made a two stroke compliant with US or European standards is still considered several years away

Four stroke carburettor engines are generally quieter more fuel efficient and are less polluting than conventional two stroke engines

Direct fuel injection (dfi) either two stroke or four stroke overcomes the unburnt fuel problem and can meet the stringent regulated exhaust emission limits that apply overseas However there is not any evidence that dfi engines are being used in outdoor garden equipment available in Australia It appears that engines used in outdoor garden equipment in Australia are generally restricted to two and four stroke carburettor engines

Small engines are not as advanced in environmental terms as motor vehicle engines As a result even the better-performing small engines emit far greater quantities of pollutants per hour than typical modern car engines For example the US Environmental Protection Agency (USEPA) 2002 limit for a typical 4 kilowatt (kW) lawnmower motor is about 66 grams (g) of regulated pollutants per hour of operation A typical 08kW brushcutter sold new in 2002 emitted about 160grams of pollutants per hour - reducing to 40grams per hour if bought new in 2006 The equivalent limit for cars under Australian Design Rule 79 is about 16g per hour In other words operated over a similar time one hour of operation of a brushcutter that meets USEPA 2002 limits produces the same pollution as ten cars and a 4kW lawnmower the same pollution as four cars These comparisons are subject to differences in test methods but they do provide an indication of the disproportionate amount of pollution emitted by small engines

Engines that do not comply with current USEPA requirements are likely to emit several times the amount of pollution calculated in the above example Therefore the worst performing engines are likely to emit some ten times the emissions of the best performers

Because of the combustion of oil these engines also emit high levels of particles Although small engines only contribute a small amount to total particle emissions the rate of particle release compared to other engines can be very high For example lawnmowers can emit over 10 times more particles (in terms of grams per hour) than a petrol motor vehicle (manufactured between 1994 and 2001)

All the above emission comparisons between outdoor garden equipment engines and motor vehicles are subject to differences in test methods but they indicate the disproportionate amount of pollution emitted by small garden equipment engines It also needs to be recognised that motor vehicles in Australia average more than 15000 kilometres per year (ABS 2003) while the annual average use of outdoor garden equipment is around 25 hours for a lawnmower and less for other types of equipment Commercial operators however are likely to have a much higher usage rates than the general public

2

This paper examines the Australian market for small engines used in lawnmowers and handheld garden equipment their impact on air quality relevant overseas regulations and their applicability to Australia and makes recommendations to reduce air quality impacts from these engines

A wide range of information sources has been referenced for this report including data and information supplied by manufacturers distributors and dealers in small engines

3

2 Air Quality and Outdoor Garden Equipment Engines

Emission inventories make estimates of emissions of substances from a multitude of sources into airsheds The National Pollutant Inventory (NPI) which is run cooperatively by the Australian state and territory governments contains data on 90 substances that are emitted to the Australian environment The substances included in the NPI have been identified as important because of their possible health and environmental effects Industry facilities estimate their own emissions annually and report to states and territories Non-industry (or diffuse) emissions estimates which includes emissions from outdoor garden equipment are made by the states and territories on a periodic basis using information sources such as surveys databases and sales figures

The NPI only reports emissions from domestic lawn mowing and for a few airsheds the contribution made by public open space lawn mowing It does not report on the contribution made by other types of outdoor garden equipment such as brushcutters National and selected state NPI emissions estimates for the common air pollutants and for Air Toxics NEPM pollutants from domestic lawn mowing are summarised in Table 1 It should be noted that national emissions from lawn mowing are underestimates as the NPI records emissions for major airsheds only and therefore is not Australia wide plus the estimates do not include evaporative emissions from fuel tanks and hoses

This NPI data is indicative only as the accuracy and completeness of the data sets varies across airsheds and is reliant on the estimation techniques used For example while the population in the NSW is higher than other airsheds its emissions look disproportionally high when compared to the other airsheds This could be because the estimation technique varies or it is due to some other factor

4

Table 1 National Pollutant Inventory Domestic Lawn Mowing Emission Estimates

Substance Port Phillip

Population 34 mill (1996)

SE Qld

Population 23 mill

NSW GMR

Population 47 mill

Adelaide

Population 10 mill

National

Common Air Pollutants (tonnesyear)

Carbon monoxide 12000 12000 24000 6100 69000

Total Volatile Organic Compounds 3600 3800 7000 2000 21000

Particulate Matter 100 um 86 94 170 9 460

Sulphur dioxide 5 5 9 50 81

Oxides of Nitrogen 63 54 120 24 330

Air Toxics (tonnesyear)

Benzene 230 210 390 130 1200

Formaldehyde 56 38 NA 31 180

Polycyclic aromatic hydrocarbons 07 11 21 04 41

Toluene (methylbenzene) 370 360 660 210 2000

Xylenes (individual or mixed isomers) 270 260 490 150 1500

Analysis of the NPI database at the national level shows that domestic lawn mowing is the

- Fourth largest source of benzene contributing 7 to the total reported airshed load

- Fourth largest source of formaldehyde contributing 3 to the total reported airshed load

- Fifth largest source of xylene contributing 6 to the total reported airshed load

- Fifth largest source of toluene contributing 6 to the total reported airshed load

- Sixth largest source of carbon monoxide contributing 12 to the total reported airshed load

- Ninth largest source of VOCs contributing 3 to the total reported airshed load when biogenics (natural sources such as trees and soil) are excluded

The NSW Department of Environment and Conservation has been upgrading its emissions inventory Based on 2003 emissions data non-road anthropogenic sources

5

contribute 619 of the VOCs to the GMR airshed Preliminary results2 indicate that VOC emissions from domestic and public open space lawn mowing contributes on an annual average 41 of all VOC emissions in the GMR On a typical weekend during warmer weather this percentage rises to 11

Therefore it could be assumed that lawn mowing could contribute approximately 4 on average to VOC emissions from anthropogenic sources in major airsheds in Australia when public open space lawn mowing is included This percentage is likely to rise significantly in the warmer spring and autumn weekends which is when lawns and other vegetation grow faster and when more people garden

21 Air Quality Standards

In June 1998 the National Environment Protection Measure for Ambient Air (Air NEPM) established national uniform standards for ambient air quality for the six most common air pollutants ndash carbon monoxide nitrogen dioxide photochemical oxidants (measured as ozone) sulfur dioxide lead and particles less than 10 microns (PM10) The NEPM was varied in 2003 to include PM25 advisory reporting standards and in April 2004 a National Environment Protection Measure for Air Toxics was adopted

Nationally the common pollutants of most concern (particularly in major urban areas) are fine particles and ground level photochemical smog (measured as ozone) which is formed in the warmer months when volatile organic compounds (VOCs) and oxides of nitrogen (NOx) react in the atmosphere under the influence of sunlight in a series of chemical reactions

Recent health studies (cited in NEPC 2005) have strengthened the evidence that there are short-term ozone effects on mortality and respiratory disease The studies also strengthen the view that there does not appear to be a threshold for ozone below which no effects on health are expected to occur In recent years Australian epidemiological studies have been conducted which confirm the results of overseas studies that there is a relationship between elevated ozone levels and hospitalisations and deaths from certain conditions

There are two national ozone standards a one hour standard of 010ppm and a four hour standard of 008ppm with a goal that allows for one exceedance per year by 2008 Sydney experiences a number of days each year of ozone levels above these standards In 2003 Sydney exceeded the one hour standard on 11 days in 2003 19 days in 2004 and 9 days in 2005 The four hour standard was exceeded on 13 days in 2003 19 days in 2004 and 13 days in 2005 Further reductions in VOC and NOx emissions are needed to reduce ozone concentrations in Sydney to levels that would comply with the Air NEPM

The other jurisdictions meet or are close to meeting the current National Environment Protection (Ambient Air Quality) Measure (Air NEPM) ozone standards (NEPC 2005) However the ozone standards are being reviewed and based on current human health evidence the argument appears to be strengthening for tighter ozone standards

2 Presentation to Expert Panel 27 April 2006 by Nick Agipades Manager Major Air Projects NSW DEC

6

Should a stricter standard or an eight-hour standard consistent with international standardsguidelines be adopted achievability of Air NEPM ozone standards or goals could become an issue for some of the other major urban airsheds (NEPC 2005)

Modeling of ozone for Sydneyrsquos Greater Metropolitan Region (GMR) indicates that the implementation of Euro emission limits for on-road vehicles and hence the increased presence of these less polluting vehicles in the fleet and retirement of old more polluting vehicles from the fleet is not sufficient to meet the current NEPM goals Modeling suggests that very large reductions in precursor emissions would be required to meet the current ozone one hour goal (NEPC 2005)

Even when the effects of bushfires and when hazard reduction burning are taken into consideration airsheds such as Launceston Melbourne and Sydney struggle to meet the national standards for particles (EPA 2006) However outdoor powered equipment predominantly from two stroke engines makes only a minor contribution to ambient fine particle loads

While carbon monoxide emissions from engines used in outdoor garden equipment are regulated overseas air monitoring in Australia indicates that carbon monoxides levels are well below the national air quality standards and there are no pressing issues requiring CO from outdoor powered equipment to be regulated In addition data indicates that lowering emissions of VOCs and NOx from small engines reduces CO emissions

Many of the pollutant sources which contribute to the formation of ozone and to particle levels also contain air toxics such as benzene toluene formaldehyde and xylenes These air toxics have been shown to be responsible for a range of health problems including asthma respiratory illnesses and cancer The National Environment Protection Measure for Air Toxics requires each jurisdiction to monitor and report annually on five air toxics benzene polycyclic aromatic hydrocarbons formaldehyde toluene and xylenes The monitoring data is intended to inform future policy and also the public on ambient levels of these air pollutants Monitoring of air toxics to date shows that levels are low and below the national monitoring investigation levels (EPA Vic 2006 DEC 2006)

7

3 Emission Standards for Small Engines

31 Australia

At present there are no Australian regulations or standards to limit air pollutant emissions from small (two and four stroke) engines Australia does benefit to some extent from overseas regulations as many lawnmowers and other gardening equipment sold in Australia have engines manufactured in the United States or Europe where strict standards apply

32 United States

In the United States emission regulations set by the United States Environmental Protection Agency (USEPA) and the Californian Air Resources Board (CARB) apply to lawn mowers and other powered gardening equipment Although CARB standards currently tend to be stricter than USEPA standards by 2006 emissions limits applying under the two standards will be very similar

United States Environment Protection Agency (US EPA)

In 1995 the USEPA introduced ldquoPhase 1rdquo regulations covering small non-road engines with a power of not more than 19kW (25HP) The regulations applied to equipment manufactured from 1997

These regulations have seven classes of equipment based on portability and engine displacement volume (ldquocapacityrdquo) In March 2000 the USEPA published ldquoPhase 2rdquo regulations which are shown in Table 2 These set limits for combined emissions of hydrocarbons (HC) and oxides of nitrogen (NOx) and separate limits for carbon monoxide (CO) emissions and for two stroke engines only particles

Table 2 US EPA Phase 2 Small Engine Emissions Standards (HC+NOx in gkW-hr) (a) (b)

Small Engine Class

Type 2002 2003 2004 2005 2006 2007+

I-A (lt66cc) Non-handheld (eg lawnmowers)

- 161 161 161 161 161

I-B (66 to lt 100cc) - 161 161 161 161 161

I (100 to lt 225cc) - 161 161 161 161 161

II (225cc or more) 180 166 150 136 121 121

III (lt20cc) Handheld (eg trimmers)

238 175 113 50 50 50

IV (20 to lt50cc) 196 148 99 50 50 50

V (50cc or more) - - 143 119 96 72 (a) As carbon monoxide (CO) levels in Australia are well below the Air NEPM standard the

USEPA emission limits for CO have not been included in this table (b) Includes useful life criteria of 50125300 hours

8

When the USEPA introduced ldquoPhase 2rdquo regulations it included averaging banking and trading provisions (ABT) which were seen ldquoas an important element in making stringent Phase 2 emissions standards achievable with regard to technological feasibility lead time and costrdquo (USA 1999) The USEPA also claimed (USA 2000) that the ABT program secures early emissions benefits through the early introduction of cleaner engines

ABT provisions which apply to handheld and non handheld engines are complex but in broad terms averaging means the exchange of emission credits among engine families within a given engine manufacturerrsquos product line This allows a manufacturer to produce some engines that exceed the standards and offsetting these exceedances with emissions from engines that are below the standard Manufacturers are allowed to exchange credits from handheld to non handheld and vice versa Banking means the retention of emission credits by the engine manufacturer generating the credits for use in a future model year (for averaging or trading) Trading is the exchange of emission credits between engine manufacturers which then can be used for averaging purposes banked for future use or traded to another engine manufacturer

In January 2004 USEPA reported that in 2002 averaging was being used but there was very little use of banking It determined that the initial ABT programs as too complex and included discount rates on credits ABT was simplified in 2004 including the elimination of credit discount and multipliers and limits on credit life To date there has reportedly been limited use of banking however it is anticipated that there will be more widespread use of banking credits if the USEPA proposed Phase 3 comes into effect3 (see below)

Particulate limits (2gkW-hr) also apply to two stroke engines Carbon monoxide and durability limits (or useful life) are also prescribed The durability criteria which were introduced in Phase 2 require that the emission limits must be met through the useful life of the engine The manufacturer determines useful life of each product using standardised product testing procedures and then based on the test results selects the useful life category for each product which can be 125 250 or 500 hours These durability criteria acknowledge the large disparity in usage patterns by equipment type and between commercial and residential users It also takes into account the ability of manufacturers to design and build engines for various design lives and which fit the types of equipment engine is produced for

The March 2000 USEPA report (USEPA 2000) estimated that the expected effects of the Phase 2 regulations would be

bull A 70 reduction in HC+NOx beyond the Phase I standards (which were estimated to have reduced emissions by 32 from the unregulated baseline)

bull A 30 reduction in fuel consumption of small handheld equipment bull Price increases of between $US23 (Class III) and $US56 (Class V) for

handheld equipment

3 Dave Gardner Briggs and Stratton email 22506

9

The US EPA is currently considering lsquoPhase 3rsquo regulations which are catalyst based standards to further reduce exhaust HC and NOx emissions from non handheld engines reduce evaporative HC and NOx emissions for both handheld and non handheld engines plus include extended durability criteria These limits are currently at discussion stage only They align with CARB Tier 3 but a longer lead time is proposed

Table 3 Proposed Phase 3 Exhaust Emissions

HC+NOx gkW-hr

CO gkW-hr

Year Useful life hrs

Class I 100 610 2010 125250500

Class II 80 610 2011 2505001000

Class III-V No changes

HC+NOx std is based on averaging

Californian Air Resources Board (CARB)

Spark ignition engines

CARB regulations first introduced emission limits for small engines manufactured from1995 The more recent schedule of emission limits are shown in Table 4 These limits depend solely on the engine capacity and apply to both handheld and non handheld classes

Table 4 CARB Emission Limits for Small Engines (HC+NOx in gkw-hr)

Engine Capacity 2000-2001 2002-2005 2006+

65cc or less 72 72 72

gt65cc to 225cc 161 161 161

gt225cc 134 121 121

California has particle limits for two strokes useful life criteria and mandatory engine labeling including a consumer advisory hang tag as shown in Figure 1 The USEPA is also considering introducing an air index label

10

Figure 1 Example of a Californian Consumer Advisory Hang Tag The Californian regulations take into account sales weighted emission performance for families of engines An engine family is essentially the same engine being used in different equipment items

In 2003 California adopted a Tier 3 program for exhaust and evaporative emissions and these are based on the use of catalytic convertors The engine classes better align with US EPA categories however the exhaust standards for Class I and Class II are more stringent than the existing US EPA standards

Table 5 CARB Tier 3 for Exhaust Emissions

Model Year Displacement Category

Durability Periods (hours)

HC+NOx gkw-hr

CO gkw-hr

Particulate gkw-hr

2005 and subsequent

lt50 cc 50125300 50 536 20 + 50-80 cc inclusive 50125300 72 536 20 +

2005 gt80 cc - lt225 cc Horizontal-shaft eng

125250500 161 549

gt80 cc - lt225 cc NA 161 467 Vertical-shaft Engine 225 cc 125250500 121 549

2006 gt80 cc - lt225 cc 125250500 161 549 225 cc 125250500 121 549

2007 gt80 cc - lt225 cc 125250500 100 549 225 cc 125250500 121 549

2008 and subsequent

gt80 cc - lt225 cc 125250500 100 549 225 cc 1252505001000 80 549

the 1000 hours is applicable for 2008+ Model Year (MY) + applies to 2 stroke only Source California Exhaust Emission Standards and Test Procedures For 2005 And Later Small Off-Road Engines Adopted July 26 2004 effective on October 20 2004

California also has Blue Sky provisions These are voluntary standards for engines that meet the criteria shown in Table 6 Blue Sky Series engines are not included in

11

the averaging banking and trading program Zero-emission small off-road equipment (eg push mowers) may certify to the Blue Sky Series emission standards

In 2005 CARB aligned its test procedures with the USEPA

Table 6 CARB Blue Sky Provisions

Model Year Displacement Category

HC+NOx gkw-hr

CO gkw-hr

Particulate

2005 and subsequent lt50 cc 25 536 20

50 - 80 cc inclusive 36 536 20

2007 and subsequent gt80 cc - lt225 cc 50 549

2008 and subsequent 225 cc 40 549 Applicable to all two stroke engines

33 Canada

The Canadian small engine market has similarities to the Australia market the majority of small engines are imported from the USA and there is one Canadian manufacturer of small spark ignition engines and one major manufacturer of lawn and garden machines

A Memorandum of Understanding (MOU) which came into effect on 1 January 2000 was signed between Environment Canada and ten manufacturers of handheld equipment and nine manufacturers of engines used in non handheld machines The MOU was intended as an interim measure until regulations could be put in place Under the MOU the manufacturers agreed to voluntarily supply small spark ignition engines designed to meet the applicable USEPA Phase 1 emission standards

In 2003 Canada regulated emission limits for handheld and non-handheld small engines based on USEPA emission limits The regulations apply to model years 2005 and later While there are no separate averaging banking and trading provisions in Canadian regulations Canada allows any USEPA certified engine to be sold in Canada This means that engines that do not meet the standard level but are averaged (or use credits) in the United States can be sold in Canada Manufacturers are required to produce upon request evidence of conformity to the standards and are required to provide written instructions on engine maintenance to the first retailer

12

Table 7 Canadian Small Spark-Ignition Engine Exhaust Emission Standards

Engine class

Engine Type

Engine Displacement (cm3)

Effective date (model year)

Standard HC+NOx (gkWshyhr)

Standard NMHC+NOx (gkW-hr)

Standard CO (gkWshyhr)

I-A Non-handheld lt66 2005 and

later 50a -shy 610a

I-B Non-handheld

lt100 and 66

2005 and later

40a 37a 610a

I Non-handheld

lt225 and 100

2005r 161b 148a 519b 610a

II Non-handheld 225 2005 and

later 121a 113a 610a

III Handheld 20 2005 and later 50a -shy 805a

IV Handheld lt50 and 20 2005 and later

50a -shy 805a

V Handheld 50 2005 2006 2007 and later

119a 96a

72a

-shy-shy

-shy

603a 603a

603a a Standards apply throughout the engine useful life b Standards apply only when the engine is new Source Canada Gazette Part II Vol 137 No 24 2003-11-19

34 Europe

In 1998 the European Union introduced exhaust emission limits for small petrol engines through Directive 9768EC and in 2002 introduced amendments through Directive 200288EC The limits in the Directives align with the US regulations however they do not have averaging and banking provisions

Table 8 European Emissions Standards

Small Engine Class Type (HC+NOx in gkW-hr) 2004 2005 2006 2007 2008

SN1 (lt66cc) Non-handheld (eg lawn mowers)

161 161 161 161 161

SN2 (66 to lt 100cc) 161 161 161 161 161

SN3 (100 to lt 225cc) - - - 161 161

SN4 (225cc or more) - - 121 121 121

SH1 (lt20cc) Handheld (eg trimmers)

- - - 50 50

SH2 (20 to lt50cc) - - - 50 50

SH3 (50cc or more) - - - - 72

13

The European Union is currently considering including useful life criteria and averaging and banking provisions plus it is considering introducing a Directive to further reduce emissions from diesel engines The objective of the proposal is to tighten emissions standards for engines in general non-road applications in light of technological developments and it taking into account the parallel developments for similar legislation in the United States in order to harmonise the environmental standards and to facilitate trade

Charts comparing the USA Californian and European Emission Limits are shown below

14

35 Summary of Regulations for Non Handheld Equipment

KEY TO CHARTS

USEPA CARB EU

0

10

20

30

40

50

60

70

80

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

0 to 49cc

0

10

20

30

40

50

60

70

80

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

50 to 65cc

0

2

4

6

8

10

12

14

16

18

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

100 to 224cc

0

2

4

6

8

10

12

14

16

18

20

2000

2002

2004

2006

2008

Year Model

HC

+N

Ox g

kW

-hr

225cc and over (up to 19kW)

15

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

36 Summary of Regulations for Handheld Equipment

KEY TO CHARTS

USEPA CARB EU

20 to 49cc 0 to 19cc

250 250

200

150

HC

+N

Ox g

kW

-hr

100

200

HC

+N

Ox g

kW

-hr

150

100

50 50

0 0

Year Model Year Model

50 to 65cc 66 to 80cc

160

160

140

140

120

40 40

20 20

0 0

120

HC

+N

Ox g

kW

-hr

HC

+N

Ox g

kW

-hr

100100

8080

60 60

Year Model Year Model

16

Summary of Regulations for Handheld Equipment (continued)

KEY TO CHARTS

USEPA CARB EU

0

20

40

60

80

100

120

140

160

2000

2001

2002

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

81 to 224cc

0

20

40

60

80

100

120

140

160

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

225cc and over (up to 19kW)

17

4 Australian Market for Small Engines

41 Likely compliance with overseas emissions standards

As part of this assessment an environmental profile of equipment currently on the Australian market has been developed initially based on information from manufacturersrsquo brochures and web sites and industry magazines and then confirmed through follow-up with relevant industry contacts

Each item of equipment has been assessed on its compliance with USEPA CARB or European regulations In most cases it was not possible to match models available on the Australian market with CARB lists (CARB publishes exhaust emissions data on all appliances on its web site) This was mainly due to the inconsistency of model designations and uncertainty about ldquoengine familiesrdquo

Engine characteristics and retail price were difficult to obtain Some brochures also made claims of compliance with USEPA European or CARB requirements The detailed breakdown of current equipment on the Australian market is given in Appendix 1

The majority of small engines sold in Australia are imported and many come from countries that impose emission limits The extent of imports into Australia that do not comply with the country of origin standards is not known Industry estimates that 40 of garden products are sold through importers who are not linked to manufacturers of US EPA or European certified equipment and the source of some products sold here is difficult to establish Victa is the only company producing small engines in Australia Its iconic 2-stroke lawnmower currently cannot meet overseas emission limits

Outdoor Power Equipment Association (OPEA) assisted in identifying the Australian distributors of most brands of powered garden equipment In April 2006 a survey form was sent to a total of 43 distributors representing 97 brands of equipment The survey form sought information about the engine for all petrol-fuelled garden equipment with a power not more than 19kW

Figure 2 Extract from survey form

18

Initial response to the survey was poor Despite follow-up action and efforts from the industry association at the beginning of September 2006 26 distributors had responded to the survey information and only 13 distributors provided all data necessary for benchmarking purposes This resulted in emission compliance data for about half of the estimated products on the Australian market Attempts to match Australian models with the database maintained by the Californian Air Resources Board were also of limited success due to inconsistencies in model designations between Australia and the USA and the manner in which model information is coded in the CARB database

Table 9 Summary of distributor responses

Responses status Not OPEA OPEA ALL

Number of responses 9 8 (31) 17 (40)

Response - all data 4 9 13 (30)

Response - extra time sought 3 3 (7)

Response - no petrol products 4 1 5 (12)

Response - some data 5 5 (12)

Grand Total 17 26 43 percentages may not add to 100 due to rounding

Of the 97 brands initially identified

bull 16 brands are apparently no longer sold in Australia

bull No responses were received for 29 brands

bull Partial data were received for 12 brands

bull All data was available for 30 brands

Table 10 Summary of responses by brand

Count of brands

Analysis status Not OPEA OPEA All

Missing some data 12 12

No data received 9 (27) 20 (31) 29 (30)

No longer sold 13 3 16

Response - no models to list 3 7 10

Response received (electronic form) 5 11 16

Response received (paper form) 3 2 5

Response received (spreadsheet) 9 9

All 33 64 97

A 2004 report for the NSW DEC estimated that there were about 1200 eligible garden

19

products in the Australian market The current project has obtained data for a total of 870 products or 72 of the estimated population In addition the sampling method is likely to be biased towards products with good environmental performance In these circumstances the following analysis should be regarded as indicative only

Survey results

The following tables and figures show expected compliance with European CARB or USEPA requirements based on the limited information provided by industry

Table 11 Engine type and compliance with overseas standards Count of products Engine type

Best STD 2c 4c Unknown All 1997 - US EPA I 53 32 85 (10) 200288EU 17 17 (2) 2004 - US EPA II 1 3 4 (lt1) 2004 EURO I 8 8 (1) 2005 - US EPA II 10 29 5 44 (5) 2006 - US EPA II 107 141 2 250 (29) 2006 EURO I 6 6 (1) 2007 - US EPA II 1 1 (lt1) 2007 Euro II 2 2 (lt1) None 118 90 208 (24 Unspecified 24 60 161 245 (28) All 344 358 168 870

Unknown means the type of engine is unknown (but is most likely to be 2c) Unspecified means that the status of emissions compliance was unable to be identified None means the manufacturerdistributor has indicated that the equipment does not comply with any overseas emissions standard

Figure 3 Compliance with overseas standards - all surveyed products Note Unknown in chart includes unspecified and unknown from Table 11

20

Figure 4 Compliance with overseas standards by equipment type ldquoPhase 1 equivrdquo means the engine complies with US EPA phase 1 or 200288EU ldquoPhase 2 equivrdquo means the engine complies with US EPA Phase 2 Euro I or Euro 2 ldquoUnknown means that engine cycle (stroke) was not provided

Of the 41 categories of equipment in the survey 15 had at least 10 current products Results for these categories are set out below

Figure 5 Engine type for popular categories

21

Figure 6 Compliance with overseas standards for popular categories ldquoPhase 1 equiv means the engine complies with US EPA phase 1 or 200288EU Phase 2 equiv means the engine complies with US EPA Phase 2 Euro I or Euro 2 ldquoUnknown means that engine cycle (stroke) was not provided

42 Australian Sales of Outdoor Powered Equipment

The Australian Outdoor Power Equipment Association (OPEA) whose membership represents about 80 of the manufacturersdistributors and dealers in the industry commissions regular independent industry audits of garden equipment sales (OPEA personal communications) Sales data from OPEA is shown in Table 12

22

Table 12 Sales of outdoor garden equipment 2002 and 2005-06 2005-06 2 stroke (1000)

2002 2 stroke (1000)

2005-06 4 stroke (1000)

2002 4 stroke (1000)

2005-06 TOTAL (1000)

2002 TOTAL (1000)

Walk behind mowers 72 170 351 76 424 246

Brushcuttertrimmer 321 12 17 180 339 192

Chainsaws 152 0 0 90 152 90

Chipper shredders 0 60 46 0 46 60

Blowerblower vacuums 98 0 11 50 109 50

Ride on mowers 0 25 51 0 51 25

Generators 11 32 96 0 107 32

Hedge trimmers ampothers 40 192 0 28 40 220

694 491 476 424 1267 915

for total sales 593 463 407 537

for mowers 152 280 848 720

According to OPEA approximately 424000 walk behind lawnmowers and more than 792000 units of outdoor handheld equipment were sold in Australia in 2005-06 In addition there were sales of about 80000 replacement engines and 70000 pumps in 2005-06 most of which were four strokes These figures show that there has been considerable growth in the sales of most products with the exception of chipper shredders and the category lsquohedge trimmers and othersrsquo whose sales declined in 2005shy06 compared with those in 2002 About 17 of walk behind lawnmowers were two stroke and 83 four stroke which is an improvement in the uptake of cleaner engines when compared to 2002 when about 30 were two stroke The situation with handheld equipment is reverse with nearly 79 being two strokes compared to 47 in 2002 However many models of two stroke handheld equipment meet current US emission standards and care should be exercised in using engine type (two stroke or four stroke) as an indicator of emissions performance for this class of equipment

The OPEA 2005-06 sales estimates are shown in Figure 7 OPEA cautions that there is considerable uncertainty about the estimates for brushcutters and blowerblower vacuums as OPEArsquos figures only represent 50 and 60 respectively of sales of these products No estimates of future sales trends were identified during research for this project

23

Australian sales of 2 and 4 stroke outdoor equipment 2005-6

0 50 100 150 200 250 300 350 400

Walk behind mowers

Brushcuttertrimmer

Chainsaws

Chipper shredders

Blowerblower vacuums

Ride on mowers

Generators

Other

Annual sales (x 1000)

4s 2s

Figure 7 OPEA estimates of equipment sales in 2005-06 Note Blowervac is an industry term for equipment that combines blowing and vacuuming functions

Briggs and Stratton (Australia) who import engines from the USA supply the majority of the four stroke engines for handheld equipment sold in Australia and these comply with all the current USA and CARB regulations Imported handheld garden equipment is shipped fully assembled to a branch or distributor and is then sent to a retailer The retailer may or may not provide equipment servicing

OPEA members have expressed concern regarding the increasing sales of imported high polluting two stroke engines that allegedly do not meet any emission standards and come from countries that do not have emission standards One industry representative reported that some of the imported trimmers were being manufactured in China using outdated designs and tooling from two old bankrupt American companies and these are being sold here at about 30 of the price of traditional brands and very low cost generators from China now account for around 70 of total sales It is difficult to confirm this trend without undertaking a detailed examination of Australian import data however the significant increase in the sales of two stroke handheld equipment provides some support for this trend

On the other hand it is claimed by industry that the ride on mower market (predominately with compliant four stroke engines) has been stimulated by the Australian USA free trade agreement

24

5 Australian Users of Small Engines This section examines the market segments for garden equipment and customer purchasing behaviour

51 General Public

Purchasing behaviour

Research into consumer purchasing behaviour has found that consumers assess a product against a range of attributes for example price weight brand reputation servicing and parts availability warrantees and guarantees experience size promotions and discounts Studies have also revealed that up to 82 of Australians had bought products on the basis of social or environmental factors in the previous year (State Chamber of Commerce 2001) Related to this point the energy star rating ecolabel on whitegoods was viewed as a credible environmental claims system which is well regarded by the general consumer (Product Category Manager Mitre 10 personal communications)

As the purchase of small engine garden equipment by the general consumer is an infrequent purchase which carries a certain of amount of risk With small engines the risk can be functional risk (will not perform as expected) physical risk (for example safe features such automatic cut out on an electric lawn mower) or financial risk especially for the more expensive items The general consumer is likely to lessen the risk by seeking information and by evaluating the information on the available products over a period of time The consumer may also lessen the risk by

bull purchasing well known brands

bull buying the brand offering the best warrantees and guarantees

bull buying the most expensive brand and

bull buying a brand they have used before

Research indicates that the desired attributes of a product may not be well established at the start of a consumerrsquos search process but will often be refined as the consumer learns more about the product The consumer will also use a ranking and weighting process based on desired qualities and trade offs may be made

Reportedly purchases of engine operated garden equipment are based on price yard size fitness for purpose and other features such as weight and ease of starting (Product Category Manager Mitre 10 personal communications) Males are the predominant purchasers of garden equipment however because of changing demographics there has been an increase in the number of women purchasing these products

Less than 5 of lawnmowers purchased are push or electric mowers (Product Category Manager Mitre 10 and industry sources personal communications 2003)

25

Electric mowers are generally perceived as not being as effective as cords have limited range and rechargeable electric mowers require frequent recharging

There is a recent trend towards ride on mowers (all four strokes) probably because of changing demographics specifically older age groups moving to more rural environments with larger yards (OPEA personal communications)

A study (Wilkie 1994) investigated consumer appliance purchasing behaviour and found that the general consumer consulted a range of information sources before purchasing an appliance The appliance salesperson was found to be the most important information source for many consumers Other important information sources include newspaper advertisements friends and relatives catalogues consumer reports and brochureslabels Since Wilkiersquos study the internet will have become increasingly important as a research tool and in some instances as a way to purchase products As part of this study there is evidence of low priced products being sold into the Australian market via the internet only ndash a practice that is likely to increase in the future It was difficult to source any compliance or details on these products

At the retail chain level staff product training is generally voluntary undertaken out of store hours and as an inducement to attend training sessions suppliers usually provide incentives for staff Retail chain purchases are very price driven although some chains are reportedly interested in stocking goods that have credible environmental claims (Mitre 10 and other retail chain sources)

IBIS (2006a) reports that the domestic hardware sector which is dominated by Danks (Home Timber and Hardware Thrifty - Link Hardware and Plants Plus Garden Centre) and Bunnings is classified as a growth market and the sales of lawnmowers and other lawn and garden machinery and equipment represent about 14 of sales revenue

In summary it appears that a range of product attributes influences consumer purchases of lawnmowers and outdoor equipment Currently there is very little information about emissions in any of the information sources a consumer is likely to consult when purchasing these products Nevertheless surveys indicate that consumers are concerned about the environment and are open to including environmental considerations into their purchase decision Educating sales staff about the air emissions from lawnmowers and outdoor equipment together with ecolabels could therefore be important methods for influencing consumers towards the purchase of cleaner products

Equipment Usage

The USA Outdoor Power Equipment Institute CARB (cited in USEPA 1998) and the USEPA (USEPA 1998) have made estimates of annual usage rates and average life spans of outdoor equipment for the general consumer user and for the commercial user Table 13 gives USA usage and lifespan range for selected items of powered equipment

26

Table 13 USA Average Usage and Lifespan of Outdoor Garden Equipment For General Consumers and Commercial Users Equipment Annual usage (Hours) Lifespan (years)

General Consumer

Walk- behind mowers 20-25 6 -7

Rear engine ride on mowers 4 6 -7

Chainsaws 7 5-9

Leaf blowers 9-12 5-9

Trimmers 10 5-9

Commercial User

Walk- behind mowers 320 27

Rear engine ride on mowers 380 38

Chainsaws 405 1-13

Leaf blowers 170-293 18-28

Trimmers 170 - 275 15-28

Discussions with members of the Australian industry confirm that Australian hours of use are likely to be similar to the American estimates although this can vary depending on location For example in tropical areas lawns are mowed more often because they grow faster in this climate The American turnover of equipment is however probably higher than here as the Australian consumer tends to keep their equipment longer and so the useful life of a mower is more likely to be on average 10 ndash12 years

52 Garden and Ground Maintenance Services

According to a recent IBIS report (2006b) the revenue for this industry in 2005-06 was $383 million and the industry outlook is lsquobrightrsquo with a predicted annual average 5 growth over the next few years The Australian customer base for garden maintenance services including for lawn mowing is

Households 55 Business 25 Government 20

The sector is reportedly a growth industry due to

bull the aging population

bull the increasing numbers of households that are time poor income rich and

bull the growing trend for professional landscaping which requires a higher level of garden maintenance

27

The main customer base for these businesses includes middle to upper socioeconomic groups the aged and people who are physically disabled Growth is predicted particularly for the franchise industry with demand from the commercialindustrialgovernment sectors (IBIS 2003) A 1999 ABS survey reported that nearly one-third of older people purchased at least one domestic service per fortnight with gardening assistance being the most common This accords with an industry estimate that about 25 of householders pay someone to mow their lawn (Jim Penman Jimrsquos Mowing personal communication) The industry is sensitive to economic conditions and weather for example the drought has slowed growth over the last few years

The garden maintenance sector is dominated by small independent operators with two major franchisers Jimrsquos Mowing and VIP VIP nationally has 600 franchises and Jimrsquos Mowing about 400 Jimrsquos Mowing reportedly mows about 15000 lawns and has 53 of the market (IBIS 2006b) As franchised lawn mowing services represents about 14 of the lawn mowing services nationally it can be estimated that approximately 280000 lawns are mowed nationally by commercial operators

Jimrsquos Mowing and VIP provide training and advice to new franchisees on equipment including proper maintenance schedules Training generally occurs before franchisees purchase their equipment Most franchisees equipment would consist of two mowers a brushcutter an air blower and possibly a hedge trimmer or chain saw Operators prefer four stroke mowers and these are used for an average eight hours per week Brushcutters are generally two strokes as are other motors (IBIS 2006b and Jim Penman personal communication)

From the above it is estimated commercial operators operate mowers for up 34 million hours per year (or 8 of the total estimated mowing hours per year) and purchase approximately 66000 lawnmowers annually (25 of purchases) The sectorrsquos purchases of brushcutters is estimated to be approximately 8000 units per year or 37 of purchases Table 13 provides US commercial userrsquos annual average hours of use and average equipment life spans ndash it would be anticipated Australian rates would be similar

The main businesses contracting to provide ground maintenance services to the corporate and government sector (including universities) are Spotlessrsquos Open Space Management Transfield and Programmed Maintenance Services all of which are diversified publicly listed companies plus the Danish owned company ISS (previously Tempo Services) (IBIS 2003 and 2006b and company websites) The type of services they provide means it is likely they would have an array of equipment and a preference for the more powerful ride-on mowers and for Class V handheld equipment

53 Government Purchasing

The way purchasing decisions are made by government or other large organizations is generally very different to the approach taken by the general household consumer

bull many of the purchases are for large quantities of goods

28

bull there are well established policies and procedures in place to guide purchasing with the purchase criteria established early in the buying process and

bull those making the purchase are likely to be more knowledgeable about the product than the average consumer and they are usually not the eventual user of the goods

Value for money fitness for purpose ability to supply and over recent years environmental aspects are likely to be important factors in the purchasing decision for Government

Local State and Commonwealth Governments have responsibility for the upkeep of public assets many of which include public open space and other outdoors areas At the State and Federal level these include schools universities sporting facilities hospitals and defence facilities These services may be outsourced individual departments may undertake maintenance and purchase their own equipment or they may purchase equipment through a central purchasing facility With the central purchasing facility these items are generally purchased under contract While there is an increase in the inclusion of environmental considerations in the selection criteria for purchasing goods and services especially under contract these considerations mainly relate to waste management and recycling criteria and not air emissions

Local councils in some states for example NSW generally take responsibility for ground maintenance within their council areas or for some smaller councils the service may be contracted to a neighbouring council In other states such as Victoria there is a trend to outsource ground maintenance contracts to commercial providers

It is unknown what proportion of total sales that direct Government purchases represent however it likely to represent a relatively small share of several percent of the overall market

In summary

bull The general household consumer represents the major market segment for garden equipment accounting for up to 90 of product sales

bull Government is likely to be relatively small direct purchaser of garden equipment

bull Commercial garden services to households purchase approximately 25 of lawnmowers per year and 37 of brushcutters

bull Large ground maintenance companies are likely to prefer larger and more powerful equipment such as ride-on mowers

29

6 Result of Stakeholder Consultation

61 Regulations

The Small Engine Expert Panel ndash Outdoor Equipment considered in depth an approach to take to improve the emissions performance of outdoor garden equipment sold in Australia Discussions were particularly focused on the growing influence of cheap high emissions imported products together with the difficulties that the local manufacturer of lawn mowers is likely to face in complying with the relevant overseas standards As part of this process the industry representatives on the Panel held additional discussions and they consulted international industry experts at the manufacturing level in Europe the USA and Japan

OPEArsquos preference is for the adoption of regulations based on the USEPA standards with Phase 1 being adopted possibly from as early as 2007-08 The industry then proposes that Phase 2 be introduced in 2012 Phase 1 USA EPA standards were adopted in the USA in 1995 to be applied to equipment manufactured from 1997 and Phase 2 standards were introduced in 2002 through to 2007 and these included averaging banking and trading provisions A comparison between the USA Phase 1 and Phase2 standards is given in Table 14 The USEPA is discussing Phase 3 limits for the adoption in 20102011 which includes tighter exhaust emission limits for non-handheld equipment

The emissions limit of the two stroke lawn mower manufactured by the sole Australian manufacturer are well above USA Phase 1 limit for non-handheld equipment One avenue to address this issue which was supported by the Expert Panel ndash Outdoor Equipment would be to place lawn mowers in the US EPA Category 5 (engines gt50cc) This would result in emissions for two stroke lawnmowers being limited to 161 gkW-hour HC + NOx compared to the USA regulated limit of 161 gkW-hour HC + NOx Doing this would align the ramp-up timetable for mowers with that of other garden products

Table 14 Comparison between the USA Phase 1 and Phase 2 standards

Emission Limits GkW-hr

Phase 1 (1997 ndash2001) Phase 2 (2007) HC NOx HC+NOx CO HC+NOx CO

Non-handheld I-A lt66cc 161 610 I-B 66-lt100cc 161 610 I 100-225 cm3 161 519 161 610 II 225 cm3 134 519 121 610 Handheld III lt20 cm3 295 536 805 50 805 IV 20-50 cm3 241 536 805 50 805 V 50 cm3 161 536 603 72 603

Phase 2 limits were phased in between 2002 -2007 during which time they became tighter for simplicity only the 2007 are shown in this table (see Table 2 for more details)

30

In addition to limiting emissions the Expert Panel support the inclusion of the durability criteria which apply in the USA under Phase 2 standards and certification documentation from either the USA or Europe as adequate proof of conformity Equipment that has not been tested and certified to USA or European standards will be required to have the engines tested in a NATA certified laboratory

Some in the industry argued that regulations should include provisions for averaging for companies that wish to use it however they felt banking and trading provisions would not be necessary Industry representatives were not supportive of any Australian consumer labeling requirement instead OPEA members are willing to supply emissions data for inclusion in a web-based database that would allow purchasers to assess the environmental credentials of different makes and models

62 Discussion on recommended regulations

Timing of introduction

Some industry representatives argue that introduction of Phase 1 standards in 2007-08 will not give the industry an adequate transition period in which to develop competence in emissions certification establish new procedures and tooling in the dealers workshops train dealers and technicians on legal requirements distribute specific tooling and spare parts and reduce stocks of old (non certified) products without incurring an undue financial burden While others in the industry prefer progressing straight to phase 2 standards

If the OPEA preference for the adoption of the United States Phase 1 regulations which operated in the USA between 1995 and 2001 were introduced in Australia in 2007-08 they would be well behind the USA standards and worldrsquos best practice Furthermore the introduction of the United States Phase 2 - 2007 limits in Australia in 2012 would if the USEPA introduce Phase 3 in 2010-11 see emission limits for lawnmowers and other non handheld garden equipment in Australia still lagging United States standards and worldrsquos best practice

To introduce regulations in 2007-08 will require Government firstly to determine the most appropriate mechanism under which to enact the regulations draft the regulations prepare the regulatory impact assessment consult with the broader community and then finalise the regulations It is likely an Act of Parliament will be required at the Commonwealth level followed by complementary legislation at the State and Territory level It is possible for this to be achieved in less than a two year timeframe (as was the case for the Water Efficiency Labelling Scheme) However regulations that do not have a level of perceived urgency would take longer The level of importance and urgency to control emissions from small engines has yet to be debated and determined

31

Modified USEPA limits for lawnmowers

From the 183 lawn mowers identified through the market survey Victa is the main (possibly sole) provider of two stroke mowers with the other lawnmowers having cleaner four stroke engines

Victa is undertaking work to produce a cleaner product Victa estimates it would need a number of years to complete development production tooling and commercialisation of the cleaner engines In January 2007 it released a new two stroke carburettor lawnmower that has reduced engine emissions by more 30 but the combined HC and NOx emissions are still above USEPA Phase 1 limits Victa says this new engine is the outcome of four years of collaborative work by Victa and the University of Technology Sydney Victa is continuing with this research to further reduce emissions

A clause that allows exemptions to be granted as occurs in other countries could be included in the regulations however Victa argues that this would create uncertain trading conditions for the company for a period of time until an exemption were granted

Placing lawn mowers in the US EPA Category 5 (engines gt50cc) has the risk of opening the Australian market to more two stroke lawn mowers which has the greatest use of any outdoor powered equipment however it should see the continuance of the sole engine being manufactured in Australia In 1995 when it was introducing small engine emission limits the USEPA faced a similar issue with two stroke lawn mowers and used a similar approach by allowing two stroke lawn mowers to comply with the handheld standards It also specified that the number of two stroke lawnmower engines allowed to meet handheld standards would be subject to a declining annual production cap with the allowance provided by the production cap being phased out in 2003 There is also similar precedent for small engine emission limits that depend on engine type - European regulations for marine outboard motors set less stringent requirements for two stroke motors

Averaging Banking and Trading Provisions

The US EPA did not have averaging banking and trading provisions in Phase 1 and therefore all small outdoor engines were required to meet the Phase 1 limits It only introduced ABT provisions in the much more stringent Phase 2 as they would allow the most economic introduction of cleaner engines The industry claims the systems to use this provision are available and can be implemented in Australia by those who wish to use it at little cost to government

Industry claim that any supportive economic data related to averaging is sensitive and confidential It is there difficult without substantial justification by the industry to support the provision for averaging in conjunction with Phase 1 particularly given the elapsed time between the introduction of Phase 1 in the USA and their recommended introduction in Australia If there are some low volume equipment items that still cannot meet the USAEPA Phase 1 standards then these could be subjected to

32

exemptions if adequate justification can be provided (exemptions for small volumes were available under the USEPA regulations)

It was noted that for government to implement regulations a regulatory impact statement is required and this requires an assessment of the costs and benefits of the options considered with clear overall benefits shown for the preferred option Therefore if the option for manufacturers to use averaging were to be considered more information to support its inclusion would be required

Other options that could be considered to circumvent the inclusion of averaging include

i including clauses that give manufacturers the ability to apply for exemptions from the regulations for classes of equipment that have small sales volumes (these provisions are available in the USA)

ii limiting the regulation to popular types of equipment

iii using the end-of-model life provisions that have been used in the Australian Design Rules for cars In effect the end of model life provisions require new designs to comply from the implementation date but allow older models to remain on sale for a few more years This is an alternative to ABT because it facilitates earlier introduction of the regulation

iv Having a phase in period of say 2 years during which existing models can continue to be sold but new models coming on to the market must comply with the new standards At the end of the phase-in period all models must comply with the new standards This is an approach that is used when Australian Design Rules (ADRs) are introduced for motor vehicles

Consumer Information

Current Australian directions to reduce the environmental impact of consumer products favor tiered benchmarks using a lsquostarrsquo rating system (see Appendix 3 for examples such as the Mandatory Energy Efficiency Label and the Water Efficiency Labelling Scheme)

As products generally arrive in Australia assembled and packaged industry considers a mandatory requirement to label products with an Australian style star rating would impose a cost on distributors that would drive up the retail price of products Instead the OPEA members were willing to supply emissions data for inclusion in a web-based database that would allow purchasers to assess the environmental credentials of different makes and models Given the diverse nature of the industry it is unlikely a database would provide complete coverage of all products on the Australian market but inclusion in the database would indicate that the manufacturer has a commitment to environmental performance It was acknowledged in discussions that at least some Phase 2 compliant products would become available prior to 2012 and the web-based database would provide one method to promote those cleaner engines

33

In summary the Recommendations of the Expert Panel

1 Mandatory air pollutant emission standards to be introduced in Australia for all outdoor equipment (lt19kW) powered by spark-ignition engines The development of any regulation would need to be based on a formal assessment of the costs and benefits of nationally regulating 2 and 4 stroke lawn mowers and handheld power equipment which should be commenced immediately

2 Proposed standards to mirror US EPA regulations (compliance with equivalent EU regulations also acceptable)

3 Timing (subject to completion of assessment of costs and benefits)

(a) US EPA Phase 1 ndash Effective from 2007 2008

(b) US EPA Phase 2 ndash Fully implemented in 2012 (in step with 2007 USEPA limits) with phase-in period andor ABT over 2008-2012 to provide for early introduction of cleaner product

4 Walk-behind 2 stroke mowers to be included in US EPA Category 5 (gt50cc) product classifications Implementation timing to be as in Recommendation 3 above

5 All products also to be certified to relevant EPA durability categories

6 Subject to further review ABT (if included) may be phased out after 2012

34

7 The Way Forward

The optimum approach for garden equipment out engine emissions of options needs to be sustainable and cost effective This will need to be determined through a costs and benefits analysis (CBA) CBA assigns monetary values and typically assesses the impacts on the consumer on human health on the environment on industry and on government A detailed costs and benefits analysis is beyond the scope of this report however the following sections draws on available information to provide some indication of the possible costs and benefits that are associated with emissions from garden equipment engines

Air Quality Benefits

Environment Canada estimated the introduction of the regulations would result in a 44 percent reduction in combined HC+NOx emissions from small engines used in garden equipment and reduction in individual air pollutants over a 25 year period as shown in Table 15 The Canadian estimates incorporate the benefits that would accrue from the MOU signed with the industry in 2000 plus the benefits from the regulations introduced in 2003 In 2000 Canada imported around 13 million small spark-ignition engines and machines (ie a similar number to Australia) with 80 supplied by the USA

Table 15 Canadian Small Spark-Ignition Engine Emissions in Year 2025

Substance Base Case Emissions in 2025

Emissions in 2025 with Regulations

Percentage Reduction in 2025 (Regulations vs Base Case)

Criteria Air Contaminants (kilotonnes)

HC 772 410 469

NOx a 84 67 201

CO 1413 1403 07

Greenhouse Gas (kilotonnes)

CO2 2903 2645 89 Base case year 2000 (accommodating voluntary agreement) Source Canada Gazette Part II Vol 137 No 24 2003-11-19

Other Environmental Costs and Benefits

In addition to the human health benefits associated with reduced exposure to ozone there is a range of other public benefits including reduced damage to vegetation and therefore higher crop yields less damage to materials and structures particularly

35

some rubber products and improved visibility due to a reduction in smog haze Plus there are benefits associated with lower emissions of other air pollutants

To date there appears to have been little work undertaken in assigning a monetary value to these benefits as it is considered that they are likely to be small compared to human health impacts

Health Costs and Benefits

The Final Impact Assessment for the Ambient Air Quality National Environment Protection Measure (NEPC 1998) estimated that the health damage costs from exposure to ozone nationally to be in the range of $90 ndash $270 million (in 1998 dollars) This figure did not include mortality costs because of difficulty in assigning a figure to human life nor did it include costs associated with minor symptoms such as sore throat cough headache chest discomfort and eye irritation that can result from ozone exposure On the cost of ozone exposure the Impact Assessment states that lsquothe social well-being associated with potentially 6 and 20 million fewer irritating symptoms annually cannot be reliably quantified but at $1 a symptom it adds up to an appreciable amountrsquo

Since the Air NEPM Impact Assessment ozone levels in Australian urban areas have not fallen significantly but the population and medical costs have increased since then However using the above figures to make a rough estimate the contribution made by engines used in lawnmowers (ie not including other garden equipment) to the health damages cost from ozone exposure would be at a minimum $36 - $108 million not including the cost of mortality or minor symptoms As any action on these engines is likely to only remove high emission engines over a decade or more a CBA would be required to include an assessment of the proportional health benefits that would accrue from only removing the high emitters over time

Costs and Benefits to the Consumer

In 1995 the USEPA estimated that on average the cost to the engine manufacturer to install the necessary emission control technology to meet Phase 1 standards (which didnrsquot have ABT) would be approximately $US2 per engine used in nonhandheld equipment and $US350 per engine used in handheld equipment It also estimated that this would translate to sales-weighted average price increases of about $US7

The introduction of phase 2 regulations USEPA estimated would result in price increases of between $US20 and $US64 for handheld equipment depending on the equipment class (USEPA 2000) where handheld engines ranges in price from $60 to $1000 (USEPA 1995)

In addition to emission reductions the implementation of exhaust emission limits has the advantage of reducing fuel consumption and lowering operating costs to the consumer For example the USEPA estimated that for Phase 1 limits that applied between 1995 and 2001 on an average sales-weighted engine basis would decrease fuel consumption by 26 percent for non handheld equipment and a 13 percent decrease in fuel consumption for handheld equipment (USEPA 1995) Phase 2

36

(current limits) would result in a further decrease in fuel consumption of approximately 30 percent for handheld engines

When the USEPA considered the fuel savings offset and the retail price increase it estimated that the average sales-weighted lifetime increase in cost would be about $US650 per handheld engine while nonhandheld engines will realize a lifetime savings of about $US250 per engine This does not include the lifetime savings in maintenance costs which should further benefit the consumer (USEPA 1995)

Euromot (The European Association of Internal Combustion Manufacturers) claims that compliance with European minimum performance standards that do not have ABT provisions adds around 30 to the cost of some products that have had to be brought into compliance4 compared to products sold under the ABT system in the US

Costs and Benefits to Industry and Government

As there is only one local manufacturer among the 43 distributors of powered outdoor garden equipment sold in Australia and all others are importers the main costs to reduce the emissions contribution made by these engines will be associated with program administration and compliance particularly if regulations are introduced

The Productivity Commission an independent agency which is the Australian Governmentrsquos principal review and advisory body on microeconomic policy and regulation recently examined the cost effectiveness of measures to improve the energy efficiency in household appliances As part of its review lsquoThe Private Cost Effectiveness of Improving Energy Efficiencyrsquo it examined labelling programs (ie regulated tiered benchmarks) and minimum mandatory energy efficiency requirements (ie a regulated simple benchmark) While the household appliance market is considerably larger than the garden equipment market the Commissionrsquos final report contains some information that is useful for determining the approach that could be used to establish an emissions reduction scheme for garden equipment A summary of relevant sections of this report is provided in Appendix 3

The Commission identified both administration and compliance costs associated with labelling programs and minimum mandatory energy efficiency requirements as well the impacts these had on product suppliers

The Department of the Environment and Water Resources provided details to the Commission on the costs involved in administering both the labelling scheme and the minimum performance standards for energy programs The information provided showed that

bull the administration costs of the simple benchmark approach were substantially lower (less than one tenth) than for labelling and 84 per cent of administration costs were passed on to appliance purchasers with the remainder borne by governments

4 Presentation by Dr Holger Lochmann Rob Baker Axel Rauch Stihl 19 April 2006

37

bull the compliance costs for labelling are higher

bull minimum mandatory energy efficiency requirements can have a greater cost for suppliers than labelling since suppliers must adjust their model ranges to meet the MEPS levels by the given date These compliance costs are however influenced by the lsquolead inrsquo time between introduction and the implementation of the regulations

bull The increased cost to appliance purchasers of labelled appliances was about two and half times higher compared to appliances purchased under minimum mandatory energy efficiency requirements this being due to consumers voluntarily purchasing more efficient appliances

Overall the Commission considered that labels should be more actively considered as an alternative to minimum performance standards The Commissionrsquos support was based on the ability of labels to amongst other things

bull directly address ldquoa source of market failure mdash the asymmetry of information between buyers and sellers of energy-using productsrdquo

bull provide information to the consumer that is readily-accessible and easily-understood so they can help the consumer make better-informed choices

bull Have net social benefits and possibly have net benefits for consumers

bull provide a greater incentive for suppliers to sell environmentally better products

bull warn consumers through a disendorsement label that an appliance is very inefficient This approach can discourage but not prevent consumers from buying the poor performing product

71 Options to Reduce Emissions from Garden Equipment Engines

There is a range of options that could be considered for reducing emissions from engines used in outdoor garden equipment in Australia These include

1 Do nothing

2 Partnership Programs

3 Quasi regulation

4 Co-regulation

5 Regulations

In the following discussion about these options many Australian examples are mentioned Further details about these programs plus an overview are provided in Appendix 2

38

72 Option 1 ndash Do Nothing

Based on data supplied by OPEA the sales of high emitting two stroke carburettor engines as a percentage of engines used in outdoor equipment increased during the period 2002 to 2005-6 (see Table 12) from 463 to 593 and overall sales number increased by 38 during that period There is no indication that in the short to medium term that sales of equipment with two stroke carburetor engines will decrease in overall sales numbers or as a percentage of sales Therefore under the lsquodo nothingrsquo option emissions from outdoor garden equipment will continue at the same rate or perhaps based on sales figures of two stroke carburetor powered equipment at an even higher rate in the future

73 Option 2 ndash Industry - Government Partnership

In the discussion papers prepared for the NSW small engine project (2004) some examples of successful voluntary Government-Industry Partnership programs were provided The examples included were

bull the National Industry Reduction Agreement where the major newspaper and magazine publishers in Australia agreed to promote recovery and recycling of old newspapers and magazines

bull the NSW EPA-Oil Industry MOU on Summer Fuel the National Packaging Covenant (which has legislative backup) and

bull the EPA Victoriarsquos agreement with the Altona Chemical Complex

From the Australian programs reviewed it appears that the best indicators for successful partnership programs are

bull a relatively small number of firms within the industry

bull a commitment and involvement by all of the industry

bull clear program aims and objectives plus program targets and

bull a willingness by the industry to enter into a cooperative partnership with government

There are 43 identified distributors selling 97 brands of outdoor powered equipment in Australia Many of the major distributors are members of OPEA but there are many distributors who are not members It is therefore unlikely that the even the majority let alone all of the Australian distributors would commit to a industry-government partnership to reduce emissions

74 Option 3 - Quasi Regulation

Quasi regulations can take a range of forms the most usual being the establishment of a code of practice that industry endorses and implements A fundamental part of the code of practice would be emissions standards There are few examples of the use of codes of practice to limit emissions

39

Governmentrsquos role under this scenario is likely to be in assisting in the development of standards

The likelihood of this option being successful for similar reasons to the industry government partnership option is low

75 Option 4 -Co Regulation

Co-regulation is an agreement by industry and government to certain undertakings that support the uptake of cleaner products with a regulatory base It allows industry program flexibility to achieve certain negotiated targets Australian examples of coshyregulation include

bull The Green Vehicle Guide which operates through an industry government agreement where industry report test results to government in an agreed format within a certain timeframe Government manages the data and promotes the program This program is underpinned by Australian Design Rules for motor vehicles

bull The electrical appliance stand-by power program where there are agreed targets established that industry is required lsquovoluntarilyrsquo to meet failure to achieve the targets will result in regulation

bull The Packaging Covenant which is a program that allows industry the flexibility to design it own programs to reduce packaging waste and achieve certain target The Covenant is complemented by the NEPM on used packaging which specifies certain government responsibilities to support the program plus measures that will be introduced if targets are not met

Given the large number of distributors on the Australia market co-regulation for engines used in garden equipment using a similar form to the standndashby power program or the packaging program - an agreement by industry and government on a percentage reduction target for the sale of high emitting engines within a specified timeframe together with an agreement that regulation will be adopted if the target is not met ndash is also unlikely to be successful

76 Option 5 - Regulation

Regulation which requires a clear acknowledgement of a sufficient problem by Government places uniform mandatory compliance obligations on industry The costs associated with regulations are usually shared between government and industry with the development of regulations and program administration costs being borne by government with industry meeting compliance costs including emissions testing and if applicable labelling costs

It could argued that regulation should be introduced in the States or Territories where there are exceedances of the Air NEPM ozone standards However development of state based regulations for garden equipment engines emissions is unlikely as they would be incompatible with the 1992 Intergovernmental Agreement on the

40

Environment signed by the Commonwealth States and Territories and existing Commonwealth and State Government mutual recognition legislation The Intergovernmental Agreement on the Environment which underpins the development of National Environment Protection Measures obligates all jurisdictions to ensure equivalent protection from air pollution to all Australians

In addition enforcement of any state based legislation would be a key problem Under the Commonwealth Mutual Recognition Act 1992 and the Trans-Tasman Mutual Recognition Act 1997 goods that are imported into or produced in an Australian State or Territory or New Zealand that can be sold lawfully in that jurisdiction can be sold freely in a second jurisdiction even if the goods do not comply with the regulatory standards of the second jurisdiction This means non-regulated small engine products legally sold in one State could be legally sold in any other state regardless of whether emissions limits on small engines applied in that State

National regulation on the other hand would provide national consistency It would also provide the opportunity to adopt worldrsquos best practice standards and incorporate penalties for non-complying parties

Under the Australian Constitution the Commonwealth does not possess specific legislative powers in relation to the environment and heritage There are however a number of legislative powers that can support environment and heritage legislation Furthermore Commonwealth legislative powers can be used cumulatively For example the Commonwealth Parliament can make laws under section 51(20) of the Constitution with respect to ldquoforeign corporations and trading or financial corporations formed within the limits of the Commonwealthrdquo

Legislative mechanisms may also be created through the development of a National Environment Protection Measure (NEPM) that then becomes law within each jurisdiction A NEPM can accommodate flexibility of implementation where jurisdictions that have elevated ozone levels can tailor their NEPM program to their specific air quality needs An example of this flexible approach is the Diesel NEPM which has a suite of programs which can be implemented by jurisdictions

From the review of Australian regulations to reduce the environmental impacts of products and the overseas approaches to control emissions from small engines two regulatory approaches become apparent a simple benchmark or tiered benchmarks These are outlined below

Regulatory Option1 - A Simple Benchmark Approach

The most basic regulatory approach that could be taken would be to have a single emission standard (or as per the USA Europe and California a number of emission standards based on power and application) for combined HC + NOx emissions All equipment with new engines sold in Australia from the date the regulations are introduced This approach would

bull remove the all high emission engines from sale

41

bull be supported by an Australian Standard and

bull provide consumers with confidence that all products meet certain emissions standard

Regulatory Option 2 -Tiered Benchmarks

Current Australian directions to reduce the environmental impact of consumer products favour tiered benchmarks using a lsquostarrsquo rating system (see Appendix 2 for examples)

For engines used in garden equipment a tiered emissions labelling system could be based on the USEPA Phase 1 and Phase 2 standards use a system of lsquostarsrsquo to provide information to consumers about environmental performance but not limit consumer choice A tiered lsquostarrsquo system approach would

bull reward those products with more stars that meet the more stringent overseas standards

bull either operate with minimum emissions performance standards or disendorsement labels

bull be supported by a product label and possibly a web database

bull provide consumers emissions information and the option to purchase a lower emission engine

bull be supported by an Australian Standard and

bull be devised to meet worldrsquos best practice which is an overarching approach supported by Government

Table 16 summarises the main strengths and weaknesses of the above options

42

Table 16 Main Strengths and Weaknesses of Each Option

Strengths Weaknesses

Do Nothing Does not limit consumer choice Emissions contribution likely to grow No cost to government No barrier to new market entrants selling

high emitters Consumers have a wide choice of products Industry unchecked amp product dumping

likely No enforcement recourse on environmental grounds available

Partnerships Some sharing of responsibility government Slow if any reduction in high emitters

ndash industry

Potential for Government assist in Few if any companies likely to join and no advancing reductions in high emitters restrictions on non signatories Reduction targets set Below worldrsquos best practice

Quasi Regulation Similar strengths to partnership option Similar weaknesses to partnership option as

few if any companies likely to adopt code of practice

Co-Regulation Ongoing consultation between industry and Due to industry diversity targets unlikely to government recourse to regulation be met Targets set and can require new market Slow reduction in emissions entrants to achieve targets Can have implementation flexibility Emissions test standard adopted

Regulation Option 1- Simple Benchmark Worldrsquos best practice standards can be ovide incentives to manufacturers to promote low adapted and is mandatory emitters

Recourse to legal action available for non Does not provide consumers with emissions compliance information Significant quantifiable health benefits Cost of enforcement borne by taxpayers Requires compliance by all industry and High cost to government bans high emitters

Regulation Option 2 ndash Tiered Benchmarks Provides consumers with emissions information but does not limit choice Incentives for manufacturers to sell low emitters Potentially significant quantifiable health benefits Can be designed to overcome ABT issue

Significant administration and compliance costs to Government High cost to government and industry and will increase retail price of engines Does not ban high emitters

43

77 Preferred Approach

From the above discussion and from the review of garden equipment on available to the Australian consumer there are many companies selling powered garden equipment on the Australian market and the market is very competitive Furthermore from the Expert Panel discussions and stakeholder consultation it is apparent that it is highly unlikely that all the companies in the garden equipment industry would engage in or commit to a voluntary program to reduce their productsrsquo exhaust emissions It is therefore clear that the only feasible path to reduce emissions from these small engines is through regulation

While regulations of emissions from small engines used in garden equipment in Australia are likely to be based on overseas regulations they need to strike a balance between improved environmental outcome harmonisation with international standards and the characteristics of the local industry With regulation optimum emissions reductions are achievable especially by combining minimum emissions standards with tiered product labelling Whether this approach is justifiable on economic grounds that is the benefits outweigh the costs can only be determined through a detailed impact assessment Based on these findings it is recommended that a formal assessment of the costs and benefits of nationally regulating 2 and 4 stroke lawn mowers and handheld power equipment should now be commenced

44

References Air Resources Board California Environmental Protection Agency Californian Exhaust Emission Standards and Test Procedures for 2005 and Later Small Off-road Engines July 26 2004

Artcraft 2003 A Major Research-Based Review and Scoping of Future Directions for Appliance Efficiency Labels in Australia and NZ prepared for the Australian Greenhouse Office viewed at wwwenergyratinggovaulibraryindexhtml

Australian Bureau of Statistics 1999 Older People Australia A Social Report Report Number 41090 December 1999

Australian Greenhouse Office 2002 Achievements 2002 National Appliance equipment energy efficiency program Commonwealth of Australia

Australian Greenhouse Office 2002 Achievements 2002 National Appliance equipment energy efficiency program Commonwealth of Australia

AustralianNew Zealand StandardtradeASNZS 64002005 Water efficient productsmdashRating and labeling Federal Register of Legislative Instruments F2005L01571

Bei L T and Widdows R1999 Product knowledge and product involvement as moderators of the effects of information on purchase decisions a case study using the perfect information frontier approach Journal of Consumer Affairs 33(1) 165-186

Buy Recycled Busines Alliance Briefing Paper Environmental Claims And Labelling Abstract lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10-2003

California Code of Regulations 1998 Final Regulation Order Article 1 and Article 3 Chapter 9 Division 3 Title 13 Attachment 1 26 March 1998 wwwarbcagovregactsoreregs_finpdf

Canada Gazette Part II Vol 137 No 24 2003-11-19

Canadian Gazette 29 March 2003 Vol 137 No 13 Part 1 pp 935- 955

Cap Gemini Ernst amp Young (2001) Cars Online 2001 Global consumer survey httpa593gakamainet75931951a8b278a28319eawwwcgeycomhightechautomediaC ars_online2pdf

Clothes Washers Australiarsquos Standby Power Strategy 2002 ndash 2012 Standby Product Profile 200308 October 2003 wwwenergyratinggovau

Craig ndash Lees M Joy Sally Browne B 1995 Consumer Behaviour John Wiley amp Sons Queensland 1995

Department of Environment and Conservation NSW 2004 Measures to Encourage the Supply and Uptake of Cleaner Lawnmowers and Outdoor Handheld Equipment

45

Department of Environment and Conservation 2003 Who cares about the environment in 2003 A survey of NSW peoplersquos environmental knowledge attitudes and behaviours DEC Social Research Series

Department of Environment and Conservation Action for Air update 2006

Department of Environment and Conservation The Buy Recycled Guide Online Directory viewed at wwwresourcenswgovauindex-RNSWhtm

EcoRecycle 2004 Paint Take-Back Takes Off in Bayswater Media release 24 March 2004 viewed at wwwecorecyclevicgovau May 2004

Enviromower viewed at wwwenviromowercomau June 2004

Environment Canada 2000 Future Canadian Emission Standards for Vehicles and Engines and Standards for Reformulation of Petroleum Based Fuels Discussion Paper in Advance Notice of Intent by the Federal Minister of the Environment April 2000 wwwecgccaenergfuelsreportsfuture_fuelsfuture_fuels1_ehtm

Environment Canada 2004 Environment Minister Urges Canadians to Reduce Greenhouse Gas Emissions and Mow Down Pollution With Unique Incentive Program Media Release April 23 2004 viewed at wwwecgccamediaroomnewsrelease May 2004

Environment Protection and Heritage Council National Environment Protection (Ambient Air Quality) Measure Report on the Preliminary Work for the Review of the Ozone Standard October 2005

Environment Protection Authority 2006 Victoriarsquos Air Quality ndash 2005 Publication 1044 June 2006 wwwepavicgovau

Environmental Choice NZ 2001 Public Good and Environmental Labelling An Internal Background Paper

European Commission Directive 200344EC amending the recreational craft directive and comments to the directive combined 211005

George Wilkenfeld and Associates Pty Ltd with Artcraft Research and Energy Efficient Strategies Tomorrow Today 2003 Final Report A Mandatory Water Efficiency Labelling Scheme for Australia Prepared for Environment Australia June 2003

George Wilkenfeld and Associates 2003 A National Strategy for Consumer Product Resource Labelling in Australia prepared for the Australian Greenhouse Office December 2003 viewed at wwwenergyratinggovaulibraryindexhtml

Green Vehicle Guide wwwgreenvehicleguidegovau

Harrington L and Holt S 2002 Matching Worldrsquos Best Regulated Efficiency Standards ndash Australiarsquos success in adopting new refrigerator MEPS wwwenergyratinggovaulibrarypubsaceee-2002apdf

46

Harris J and Cole A 2003 The role for government in ecolabelling ndash on the scenes or behind the scenes lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10-2003

Holt S and Harrington L2003 Lessons learnt from Australiarsquos standards and labeling program Paper presented at ECEEE Summer Study - 2-6 June 2003 wwwenergyratinggovaulibraryindexhtml

IBIS 2006a Domestic Hardware Retailing 09-Jun-2006 Industry Code G523b

IBIS 2006b Gardening Services 18-Jan-2006 Industry Code Q9525

IBIS 2003 Gardening Services in Australia 23 December 2003 Industry Code Q9525

Lawrence K Zeise K amp Morgan P 2005 Management Options for Non-Road Engine Emissions in Urban Areas Consultancy report for Department for Environment amp Heritage Canberra

Motor Vehicle Environment Committee (MVEC) in consultation with the Department of Transport and Regional Services 2002 Proposal for an Australian ldquoGreen Vehiclesrdquo Guide viewed at httpwwwdotarsgovaumvegreen_vehicles_guidedoc May 2004

National Appliance and Equipment Energy Efficiency Committee The Energy Label at wwwenergyratinggovau (3504)

National Environment Protection Council 2005 National Environment Protection (Ambient Air Quality) Measure Report on the Preliminary Work for the Review of the Ozone Standard October 2005

National Environment Protection Council 1998 Final Impact Assessment for Ambient Air Quality National Environment Protection Measure June 1998

National Environment Protection Council 1999 Used Packaging Materials Impact Statement for the Draft NEPM Used Packaging Material January 1999 viewed at wwwephcgovau

National Environment Protection Council 2004 National Environment Protection (Air Toxics) Measure April 2004 viewed at wwwephcgovau

New South Wales Government 2002 Protection of the Environment Operations (Clean Air) Regulation 2002

New South Wales Government 1999 NSW Government Procurement Policy Statement White Paper 1999

Nordic Council 2002 Ecolabelling of marine Engines Criteria Document 8 December 1995 ndash 6 December 2005 version 35 December 2002

47

Office of Public Sector Information Statutory Instrument 2004 No 2034 The Non-Road Mobile Machinery (Emission of Gaseous and Particulate Pollutants) (Amendment) Regulations 2004 wwwopsigovuksisi200420042034htm

Outdoor Power Equipment Institute 2001 Profile of the Outdoor Power Equipment Industry wwwopeiorg

Productivity Commission 2004 The Private Cost Effectiveness of Improving Energy Efficiency Final report October 2005 wwwpcgovauinquiryenergy

Publishers National Environment Bureau Media Release lsquoAustralia leads the world in newspaper recyclingrsquo 6 June 2006 wwwpnebcomau

Real J Jones A 2005 The Green Vehicle Guide Clean Air Soceity of Australia and New Zealand Conference 2005 Hobart

Salmon G Voluntary Sustainability Standards and Labels (VSSLs) The Case for Fostering Them OECD Round Table On Sustainable Development

Schkade D A and Kelinmutz D N 1994 Information displays and choice processes differential effects of organization form and sequence Organizational Behavior and Human Decision Processes 57(3) 319-337

Stephens A 2003 Eco Buy (Local Government Buy Recycled Alliance Victoria) Abstract lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10shy2003

Teisl M F Roe B and Hicks RL 2002 Can eco-labels fine tune a market Evidence from dolphin-safe labeling Journal of Environmental Economics and Management 43339-359

Teisl M F Roe B and Levy A S Ecolabelling What does consumer science tell us about which strategies work pp141-150

The ISO 14000 family of standards guides and technical reports

The Parliament of the Commonwealth of Australia 2004 House of Representatives Water Efficiency Labelling and Standards Bill 2004 Explanatory Memorandum wwwcomlawgovauComLawLegislationBills1nsf viewed February 2006

Thogerson J 2000 Promoting green consumer behaviour with eco-labels Workshop on Education Information and Voluntary Measures in Environmental Protection National Academy of Sciences ndashNational Research Council Washington DC November 29-30

United States Environmental Protection Agency Federal Register Vol 60 No 127 3 July 1995 Control of Air Pollution Emission Standards for New Nonroad Spark-ignition Engines At or Below 19 Kilowatts wwwepagovEPA-AIR1995JulyDay-03prshy805txthtml

48

United States Environmental Protection Agency Federal Register Vol 69 No 7 12 January 2004 Rules and Regulations 40 CFR Part 90 Amendments to the Phase 2 Requirements for Spark-Ignition Nonroad Engines at or Below 19 Kilowatts Direct Final Rule and Proposed Rule wwwepagovfedrgstrEPA-AIR2004JanuaryDay-12a458pdf

United States Environmental Protection Agency Office of Pollution Prevention and Toxics Pollution Prevention Division 1998 Ecolabelling Environmental Labelling - A Comprehensive Review of Issues Policies and Practices Worldwide

United States Environmental Protection Agency Office of Transportation and Air Quality March 2000 Regulatory Announcement Final Phase 2 Standards for Spark-Ignition Handheld Engines

United States Environmental Protection Agency 1998 Proposed Phase 2 Emission Standards for Small SI Engines 27 January 1998

United States Environmental Protection Agency 2000 Regulatory announcement Final Phase 2 Standards for Small Spark-Ignition Handheld Engines March 2000 EPA420-F-00shy007

United States Federal Register Vol 69 No 7 Monday January 12 2004 Rules and Regulations Environmental Protection Agency 40 CFR Part 90 Amendments to the Phase 2 Requirements for Spark-Ignition Nonroad Engines at or Below 19 Kilowatts Direct Final Rule and Proposed Rule United States Federal Register Vol 64 No 60 30 March 1999 40 CFR Part 90 Phase 2 Emission Standards for New Nonroad Spark-Ignition Nonhandheld Engines At or Below 19 Kilowatts Final Rule pp15214-15216

United States Federal Register Vol 65 No 80 25 April 2000 40 CFR Parts 90 and 91 Phase 2 Emission Standards for New Nonroad Spark-Ignition Handheld Engines at or Below 19 Kilowatts and Minor Amendments to Emission Requirements Applicable to Small Spark-Ignition Engines and Marine Spark-Ignition Engines Final Rule pp24282-24284

United States Environmental Protection Agency Control of Air Pollution Emission for New Nonroad Spark-ignition Engines At or Below 19 Kilowatts Final Rule 40 CFR Parts 9 and 90 1995 wwwepagovEPA-AIR1995JulyDay-03pr-805txthtml

United States Environmental Protection Agency Office of Pollution Prevention and Toxics Pollution Prevention Division 1998 Ecolabelling Environmental Labeling- A Comprehensive Review of Issues Policies and Practices Worldwide

Victorian Government Greenhouse Strategy Community Action Fund - Mow Down Lawn Mower Rebate Exchange Program wwwgreenhousevicgovaucommunitygrantscafsuccessfulprojectshtm

Water Efficiency Labelling and Standards Act 2005 No 4 wwwcomlawgovauComLawLegislation

49

Water Efficiency Labelling and Standards Determination 2005 wwwcomlawgovauComLawLegislationLegislativeInstrument1nsf

Water Efficiency Labelling and Standards Regulations 2005 wwwcomlawgovauComLawLegislationLegislativeInstrument1nsf

Wilkie W 1994 Consumer Behaviour John Wiley and Sons NY as cited in Craig ndash Lees M Joy Sally Browne B 1995 Consumer Behaviour John Wiley amp Sons Queensland 1995

wwwenergyratinggovau

wwwgreenvehicleguidegovau

wwwwaterratinggovau

50

Appendix 1 Detailed Breakdown of Powered Garden Equipment on the Australian Market

The following table gives a profile of the current equipment on the Australian market It is based mostly on distributor responses to a survey and might not be representative of the total market

Low sales indicates that no sales data was available but volumes are likely to be small compared with popular equipment Phase 1 is US EPA Phase 1 or EU Directive 200288EU Phase 2 is US EPA Phase 2 or Euro standards

Type Ranges Stroke Aerator 5 makes 6 models Sales Low

Engine power 26 to 172kW Engine displ 143-674 ml

2c -4c 5 Unspecified 1 Phase 1 - Phase 2 4

Auger 3 makes 5 models Sales Low

Engine power 12 to 16kW Engine displ 31-ml

2c 5 4c -Unspecified -Phase 1 1 Phase 2 1

Backhoe 0 makes 0 model Sales Low

(2 models in 2003) -

Blower 13 makes 49 models Sales 109K

Engine power 07 to 31kW Engine displ 24-80ml

2c 34 4c 2 Unspecified 13 Phase 1 10 Phase 2 17

Blower-wheeler 3 makes 6 models

Engine power 07 to97kW Engine displ 24-305ml

2c 1 4c 4 Unspecified 1 Phase 1 3 Phase 2 -

Blowervac 6 makes 9 models Sales

Engine power 07 to 11kW Engine displ 24-34ml

2c 6 4c -Unspecified 3 Phase 1- Phase 2 3

Brush cutter 12 makes 95 models Sales 339K

Engine power 06 to 23kW Engine displ 21-54ml

2c 66 4c 5 Unspecified 24 Phase 1 15 Phase 2 34

Chainsaw 9 makes 106 models Sales 152K

Engine power 1 to 58kW Engine displ 26-122ml

2c 74 4c -Unspecified 32 Phase 1 18 Phase 2 27

Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

51

Type Ranges Stroke Clearing saw Engine power 14 to 27kW 2c 6 3 makes Engine displ 36-57ml 4c 0 9 models Unspecified 3 Sales low Phase 1 4 Phase 2 -Cultivator Engine power 07 to 52kW 2c 2 4 makes Engine displ 25-190ml 4c 5 7 models Unspecified -Sales low Phase 1 - Phase 2 5 De-thatcher Engine power 1kW 2c 1 1 makes Engine displ 27ml 4c -1 models Unspecified -Sales low Phase 1 - Phase 2 1 Drill Engine power 1kW 2c 3 3 makes Engine displ 27ml 4c -4 models Unspecified 1 Sales low Phase 1 - Phase 2 1 Edger Engine power 1 to 4kW 2c 12 10 makes Engine displ 24-190ml 4c 11 36 models Unspecified 1 Sales Phase 1 3 Phase 2 22 Garden tractor Engine power 12 to 157kW 2c -2 makes Engine displ 465 to 675ml 4c 5 12 models Unspecified 9 Sales low Phase 1 - Phase 2 3 Grass trimmer Engine power- 2c 3 1 make Engine displ 31ml 4c -3 model Unspecified -Sales Phase 1 - Phase 2 3 Hedge trimmer Engine power 06 to 1kW 2c 28 10 makes Engine displ 21-31ml 4c 1 42 models Unspecified 13 Sales 40K Phase 1 4 Phase 2 35 Lawnmower Engine power 26 to 66kW 2c 22 19 makes Engine displ 100-270ml 4c 151 183 models Price $449-$3609 Unspecified 10 Sales 424K Phase 1 95 Phase 2 48 Line trimmer Engine power 07 to 45kW 2c 25 8 makes Engine displ 24-195ml 4c 2 29 models Price $136-$299 Unspecified 2 Sales Phase 1 2 Phase 2 6 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

52

Type Ranges Stroke Log splitter Engine power 26 to 45kW 2c -1 makes Engine displ 100-195ml 4c 2 2 models Unspecified -Sales low Phase 1 - Phase 2 1 Multicutter Engine power 08 to 14kW 2c 17 5 makes Engine displ 23-36ml 4c 1 19 model Unspecified 1 Sales Phase 1 2 Phase 2 13 Olive nut shaker Engine power - 2c -1 make Engine displ - 4c -1 model Unspecified 1

Phase 1 - Phase 2 -Pole saw Engine power 08 to 14kW 2c 6 4 makes Engine displ 23-36ml 4c -10 models Unspecified 4 Sales low Phase 1 1 Phase 2 3 Power carrier Engine power 37 to 231kW 2c -2 makes Engine displ 160 to 953ml 4c 11 11 models Unspecified -Sales low Phase 1 - Phase 2 10 Power cutter Engine power 32 to 45kW 2c 5 2 makes Engine displ 64-99ml 4c -8 models Unspecified 3 Sales low Phase 1 1 Phase 2 3 Pruner (3 models in 2003) 2c -0 make 4c -0 models Unspecified -Sales low Ride-on-mower Engine power 26 to 231kW 2c -12 makes Engine displ 100 to 725ml 4c 93 124 models Unspecified81 Sales 51K Ph1 1 Ph2106 Rotary hoe (4 models in 2003) 2c -0 makes 4c -0 models Unspecified -Sales low Shredder Engine power 3 to 96kW 2c 1 6 makes Engine displ 126-389ml 4c 16 20 models Unspecified 3 Sales 46K Phase 1 - Phase 2 4 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

53

Type Ranges Stroke Stump grinder Engine power 96kW 2c -1 make Engine displ 389ml 4c 1 1 model Unspecified -Sales low Phase 1 - Phase 2 1 Tiller Engine power 08 to 59kW 2c -3 makes Engine displ 25-243ml 4c 8 9 models Unspecified 1 Sales low Phase 1 - Phase 2 7 Trencher Engine power37kW 2c -1 makes Engine displ 183ml 4c -1 models Unspecified 1 Sales low Phase 1 - Phase 2 1 Trimmer Engine power - 2c 10 2 makes Engine displ - 4c -21 models Price - Unspecified 11 Sales Phase 1 4 Phase 2 -Turfcutter Engine power 37kW 2c -1 makes Engine displ - 4c 1 1 models Unspecified -Sales low Phase 1 - Phase 2 -Vac Engine power 22 to 172kW 2c 1 5 makes Engine displ 158 to 674ml 4c 13 15 models Unspecified 1 Sales Ph11 Ph24 Vac chipper Engine power 34 to 45kW 2c -2 makes Engine displ 158-195ml 4c 3 3 models Unspecified -Sales low Phase 1 - Phase 2 1 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

54

Appendix 2 Examples of Current Australian Benchmarking Programs

The following describes in varying degrees of detail a number of current Australian benchmarking schemes classified by program type simple bench mark approaches tiered benchmarks and government industry partnerships This appendix concludes with a summary table of these programs with an assessment of their effectiveness

1 Introduction

Simple benchmark schemes (described below) such as the woodheater standards set a single point hurdle rate whereas the green vehicle guide use tiered benchmarks The new water efficiency labelling scheme and minimum energy efficiency performance standards uses both a simple benchmark through minimum performance requirement plus tiered benchmarks incorporated into labels as lsquostarsrsquo Other approaches such as the stand-by power program and the Victorian Altona Complex VOC reduction target set goals for achievement within a specified time period Other approaches taken to reduce environmental impacts include the National Packaging Covenant which uses a program based on individual companies developing tailored approaches to suit their circumstances and is supported by enforcement capability through the National Environment Protection (Used Packaging Materials) Measure (the NEPM)

2 Simple Benchmarks

21 Minimum Energy Performance Standards (MEPS)

Purpose

MEPS prescribe a minimum allowed energy performance for specific appliances Appliances that are less efficient than the relevant standard are excluded from the market

Background and Strategy

In October 1999 as part of the National Greenhouse Strategy (1998) nationally consistent MEPS and labelling schemes were adopted across Australia

Independent NATA accredited laboratories undertake product compliance checks to see whether products perform in compliance with MEPS requirements For example

bull In 2003 the government conducted check tests on eight appliance models all of which were found not to meet the claims made on the energy performance labels Two products were deregistered one was found to have not been registered and action was pending on the remaining five products (AGO 2003b)

55

bull Other regulatory actions undertaken in 2003 included fines of $3000 and $8000 against two Western Australian retailers who were found to have sold appliances without energy performance labels Queensland and Victorian retailers received infringement notices and fines totalling $10 000 (AGO 2003b)

Summary RegulNated minimum performance standards based on an Australian Standard

22 Energy Star

Purpose

An endorsement label that indicates an electronic product has achieved a specified standard when it is not performing its core function (ie on stand by)

Background and Strategy

Energy Star is a voluntary endorsement labelling program developed by the US Environmental Protection Agency (US EPA) It has been operating in the USA since 1992 and has been adopted by a number of countries including Australia Energy Star sets voluntary standards for reducing the electricity consumption of electronic equipment when it is not performing its core function

The Government stand ndash by program which is outlined below complements the energy star labelling program

Summary Voluntary endorsement label

23 Woodheater Standards

Purpose

To reduce particle emissions through Australian Standard compliant woodheaters

Background and Strategy

Since 1992 Australian StandardNew Zealand Standards have been introduced to improve the performance of wood heaters

The first standard for wood heater emissions AS4013 (1992) was published in 1992 and was revised and published as a joint AustralianNew Zealand Standard in 1999 ASNZS4013 (1999) Domestic solid fuel burning appliances - Method for determination of flue gas emission This Standard provides a test method to measure particles emitted by residential solid-fuel burning heating appliances

56

The 1992 Standard included an upper limit for acceptable particle emissions of 55 grams of particles per kilogram (oven-dry weight) of fuel burnt This emission factor was reduced to 4 gkg in the 1999 revision of the Standard The Standard applies to solid-fuel burning space-heating appliances (including those fitted with water heating devices) with a heat output of 25KW or less It does not apply to masonry fireplaces cooking stoves central heating appliances or water-heating-only appliances

AS 4013 (1999) is complemented by ASNZS4014 (1999) Domestic solid fuel burning appliances - Test Fuels and ASNZS4012 (1999) Domestic solid fuel burning appliances - Method for determination of power output and efficiency

The woodheater industry was instrumental in initiating the development of standards and it lobbied states and territories to enact legislation to mandating that woodheaters be required to meet the standards As the health affects of particle pollution have become more apparent and as some jurisdictions are having difficulty in meeting national particle standards Government has become more proactive in controlling woodheaters and more supportive of tighter standards

All states and territories with the exception of South Australia have regulations that restrict emissions from new woodheaters although Victoria for example only introduced its regulations in 2004 compared to Tasmania who introduced regulations in 1993 These regulations require that new woodheaters comply with the Australian Standard ASNZS 4013 The State regulations however are not uniform

Many woodheaters that are currently certified for sale do not comply with the revised standard as verified in a National Woodheater Audit Program undertaken in 2004 Seven of the 12 wood heaters tested failed to meet the ASNZS 4013 particle emission limit In addition 55 of heaters were found to have deviations from the original designs and 72 had labelling faults that could adversely affect emissions performance

Testing and certification are administered by the industry association

Summary State and regulations requiring compliance with Australian Standards Certification administered by industry association

24 Standby Power

Purpose

To reduce lsquoexcessiversquo energy consumed in electrical appliance standby mode sold in Australia through in the first instance voluntary targets Appliances covered by the program range from information technology equipment such as PCs and photocopiers entertainment equipment such as TVs DVDs and sound systems major appliances such as water heaters dishwashers and refrigerators and small appliances such as smoke detectors and bread makers

57

Background and Strategy

In 2000 standby power was estimated to constitute 116 per cent of Australiarsquos residential energy use costing households over $500 million and leading to the emission of over 5 million tonnes of carbon dioxide equivalent (AGO 2002c) Holt and Harrington (2004) estimated that standby power consumption in Australia could be reduced by 56 per cent by 2020 (Productivity Commission 2005)

In August 2000 all Australian jurisdictions agreed to pursue efficiencies in standby power consumption of energy-consuming products through support for the International Energy Agencys One -Watt program and endorse its incorporation into theprogram of work

Australia reportedly has taken the lead on implementing the One- Watt program even though many of the products sold in Australia are imported

During 2002 government agencies consulted with stakeholders about ideas to reduce standby The standby strategy which proposed a list of targeted potential product types was presented to the Ministerial Council on Energy

In September 2003 an interim test method for the measurement of standby power ASNZS 62301-2003 (int) based on an internationally recognised standard was published Also during this period work commenced on developing draft product profiles for high priority targeted products

Once product profiles are completed interim voluntary date-specific targets are made The product sales are then monitored to determine progress towards the interim target If it is then determined that inadequate progress is being achieved by a significant number of suppliers then government will regulate

For example the interim 2007 target for clothes washers is as follows

Product Off mode power End of program mode

lt 1W lt 4 W

The National Standby Strategy Target to be achieved by 2012 for clothes washers is as follows

Off mode power End of program mode lt 03 W lt 1 W

In support of the clothes washer program Government will

bull consider creating a Government Purchasing Policy to buy low standby clothes washers where available and fit for purpose

bull collect data on all modes for new clothes washers and analyse trends

bull highlight the range of performances by publishing performance data on clothes washers on a website or by other means

58

bull progressively include standby energy consumption into the Comparative Energy Consumption for labelled products such as clothes washers and clothes dryers

bull work with the Standards Committees to finalise the details of modes and test methods for the relevant standards

bull determine in 2008 if progress is inadequate and if regulation is required

Summary Industry targets possible future regulation

3 Tiered Benchmarks

31 Mandatory Energy Efficiency Label ndash the Energy Star Programs

Purpose

To enable consumers to easily compare the energy performance of electrical appliances used by households and firms through a labelling scheme

Background and Strategy

Several Australian states commenced mandatory energy efficiency labelling for major appliances in the mid-1980s In 1992 it became mandatory across Australia for initially refrigerators and later freezers clothes washers clothes dryers dishwashers and air-conditioners (single phase only) to carry the label when they are offered for sale This labelling program is regarded as one of the most successful in the world (Wilkenfeld and Assoc 2003) It is administered through the Australian Greenhouse Office

The energy rating label for dishwashers

(ldquoa joint government and industry programrdquo) and a website address (wwwenergyratinggovau) and has two main features

bull the star rating which gives a quick comparative assessment of the models energy efficiency and

bull the comparative energy consumption (usually kilowatt hoursyear) which provides an estimate of the annual energy consumption of the appliance based on the tested energy consumption and information about the typical use of the appliance in the home These values are measured under Australian Standards which define test procedures for measuring energy consumption and minimum energy performance criteria Appliances must meet these criteria before they can be granted an Energy Rating Label

The Energy Rating Label includes an endorsement

59

Awards Brand ModelInstallat

ionType

Phase Available

10 Yr Energy

Cost StarRating

Output(kW)

TOSHIBA

Digital Inverter Series Air

Conditioner RAV-SM1102BT-

ERAV-SP1102AT-E (

RAV-SM1102BT-ERAV-

SP1102AT-E)

SingleSplit

SystemDucted

Single $1500 1000

CHUNLAN

KFR-32GWVWa (

NO)

SingleSplit

SystemDucted

Single $645 323

Since its introduction the star rating label seems to have established a high level of recognition with consumers Consumer research (Artcraft 2003) indicates that the different information on the label appeals to different consumer segments interested in purchasing an appliance

When a manufacturer gains approval to use the label they pay for and produce the label in accordance with specifications on size colours fonts layout and design A similar colour scheme and design to the energy consumption label is also used for the compulsory fuel consumption label on new passenger and light commercial vehicles

The labelling scheme is underpinned by regulation whereby regulated Minimum Energy Performance Standards (MEPS) provide the environmental benchmarks that the appliances are required to meet Appliances that do not meet the minimum energy performance standards can be withdrawn from the Australian market

When the energy rating program was reviewed in 2000 technology had advanced to the point where a large percentage of appliances had achieved the maximum number of stars so the rating system was tightened It is estimated that over the 25 year period 1980 to 2005 there will have been an overall reduction in energy consumption of around 70 by the most popular sized refrigerators (with freezers) (Harrington L and Holt S 2002)

In addition to the energy consumption label there is a website (wwwenergyratinggovau) with a comprehensive database of all appliances their star rating and energy consumption In 2002 there were around 220000 hits on the programrsquos various websites and 523000 in 2003 reportedly representing 80000 visits by individual inquirers The website hit rate is estimated to represent almost 10 of consumers who are considering purchasing an appliance (Holt et al 2003)

Cooling

Energy Input (kW)

250

104

Figure B Excerpt from Energy Rating web page for Air Conditioners (cooling cycle only shown)

When the energy rating program was reviewed in 2000 technology had advanced to the point where the Scheme had to be tightened because a large percentage of appliances had achieved the maximum number of stars For example energy use by refrigerators was around 70 compared to that used when the scheme started (Harrington L and Holt S 2002)

60

Regulations

State and Territory legislation refer to the relevant Australian Standards This approach simplifies the State and Territory legislation and makes it relatively straightforward to maintain national consistency of appliance and equipment energy efficiency standards even when standards are continually being revised

The testing procedures and technical requirements for the label and also Minimum Energy Performance Standards (MEPS see below) are incorporated into the applicable Australian Standards Products for sale must be registered with one of the State regulators

Program Administration

The labelling program and MEPS program are administered by the National Appliance and Equipment Energy Efficiency Committee (NAEEEC) which is ultimately directed by the Ministerial Council on Energy

Requirements for Appliance Suppliers

Appliance suppliers are required to

bull Submit applications for product registration and these must include a test report or other data to demonstrate that the appliance meets the relevant Australian Standard

bull While test reports on three separate units are required for most products there is no particular requirement for test laboratories to be accredited or products certified for registration for energy labelling and MEPS in Australia Test reports from the manufacturers laboratory are satisfactory However if there is evidence that results from a particular laboratory are unsatisfactory regulators can mandate test reports from an accredited laboratory

Summary Mandatory labelling scheme backed by regulations and an Australian Standard

32 Water Appliances Water Efficiency Labelling and Standards (WELS) Scheme

Purpose

A labelling scheme backed by legislation to promote domestic water efficient appliances

Background and Strategy

A voluntary water efficiency industry administered labelling scheme has been in existence since 1988 The water efficiency ratings and details on the label design are covered in ASNZS 6400 The main incentive of the voluntary lsquoAAAAArsquo scheme

61

has been the publicity and cash rebates offered by water utilities However the coverage water efficiency performance requirements and impact of this program have been limited

In 2003 the Environment and Heritage Ministers agreed to implement a national Water Efficiency Labelling Scheme (WELS) for products such as shower heads washing machines dishwashers and toilets Consultation with industry and stakeholders was undertaken in 2003 with a strategic study published that identified the products to be included in the new labelling Scheme A Regulation Impact Statement (RIS) which identified the costs and benefits of various options and made various recommendations was published in March 2004 Following public review of the RIS some modifications were made to WELS

The WELS Scheme is backed by the following legislation and standard

Water Efficiency Labelling and Standards Act 2005 which establishes

bull the products subject to the Scheme and the requirements for registration and labelling

bull the standards to apply to WELS products setting requirements for water efficiency performance registration and labelling of these products

bull enforcement provisions including penalties bull the appointment of inspectors to investigate possible contraventions and sets

out their powers and obligations bull review and dispute resolution bull a program Regulator bull the making of regulations bull a requirement for annual reports and for an independent review after five years

Water Efficiency Labelling and Standards Regulations 2005 which

bull prescribes the circumstances in which a person other than the manufacturer of a WELS product may be taken to be the manufacturer of the product (eg an importer)

bull sets out procedures for the issuing and the payment of penalty infringement notices as an alternative to prosecution for offences against the WELS Act

bull specifying the information to be included on an identity card issued to a WELS inspector

Water Efficiency Labelling and Standards Determination 2005 amongst other things determines and establishes product registration fees and calls up the Australian Standard ASNZS6400 2005 Water-efficient products - Rating and labelling which

bull defines the products

bull specifies the assessment procedures (ie identifies test procedures in other Australian Standards)

bull provides the formulas to give products their star rating

bull specifies the labels and their application to products

62

Approximately twenty organisations were represented on the Standards Committee that developed the Standard

State and Territory legislation

The States and Territories have also enacted or agreed to enact complementary legislation to ensure that the WELS Scheme has comprehensive national coverage State and Territory legislation which is almost a mirror of the Commonwealthrsquos Water Efficiency Labelling and Standards Act 2005 enables the States and Territories to for example undertake certain responsibilities delegated to them by the Commonwealth Regulator appoint their own inspectors and enforce the WELS

Other features of WELS include

bull A product web database

bull With the exception of toilets no other products are required to meet mandatory water efficiency requirements (WES) but this may change over time The introduction of mandatory WES means that products not meeting the minimum performance requirements can not legally be sold

bull Products must be tested in accordance with the relevant Standard and must meet any minimum performance and water efficiency requirements in the Standard before they can be granted a WELS Water Rating label

bull It is up to manufacturers or their agents (eg importers in the case of imported products) to ensure that their products are correctly registered and labelled and comply with any other requirements of the Standard

There is a transition phase which gives manufacturers and importers time to test register and label products and to sell pre-existing stock From 1 January 2008 all products are required to display the WELS Water Rating labels irrespective of their date of supply

63

The WELS Water Rating label

Label Features

bull A star rating for a quick comparative assessment of the models water efficiency

bull Labels with 1 to 6 stars

bull Some products may also be labelled with a Zero Star Rated label which indicates that the product is either not water efficient or does not meet basic performance requirements

bull A productrsquos water consumption figure

bull There are provisions for swing tags if there is inadequate surface area for label or the item is likely to be marked by sticking the label on the product

Summary Mandated product labelling using lsquostarrsquo rating system Has a disendorsement label and has provisions to ban products

33 Gas Appliance Rating Scheme

Purpose

A gas labelling program to improve the energy efficiency of gas powered products

Background and Strategy

The Gas and Fuel Corporation of Victoria introduced energy labelling for gas water heaters in 1981 This scheme was taken over by the AGA in 1985 who in 1988 introduced a six star energy performance label This label was intended to be visually consistent with the star rating labels already familiar to consumers of electrical appliances

The labelling scheme is currently voluntary and still administered by the industry body

A range of gas appliances have been subject to minimum energy performance standards (MEPS) since the 1960s The current MEPS levels were set in 1983 and

64

Brand Model Type MjyearStar

RatingSRI

StorageCapacity

(ltrs)IndoorOutdoor

NaturalGas

Instantaneous 18969 59 I N

Instantaneous 18969 59 I N

lsquothe majority of models currently on the market appear to exceed current requirements by a comfortable marginrsquo (SEAV 2003 p 23)

The gas energy labels are similar in format to those found on electrical appliances except they are blue and show annual energy use in MJ

A trial web site listing gas water heaters available in Australia is also available (see below)

Bottle Gas

Rinnai Infinity

V Series

REU-V2632FFU-A (Infinity 26 plus internal) P

Rinnai Infinity

V Series

REU-V2632FFUC-A (HD2001 internal) P

A joint review of the scheme is under way by the Gas Industry and Governments and regulation is under consideration A three year work plan has been published under the Australian and New Zealand Appliance and Equipment Energy Efficiency Program

Summary Currently voluntary labelling using lsquostarrsquo rating system with mandatory minimum energy performance standards Future regulation is under consideration

34 Green Vehicle Guide

Purpose

To provide web-based comparable and accessible environmental data on new motor vehicles

Background and strategy

65

The Commonwealth government started publishing a booklet of fuel consumption data for new passenger and light commercial vehicles in the early 1980s and a low cost web database in more recent years

In 2004 the Government through the Department of Transport and Regional Services (DOTARS) expanded the fuel consumption guide into the Green Vehicle Guide The Green Vehicle Guide is a web based database that rates new passenger and light commercial vehicles on air pollution greenhouse emissions and fuel consumption and gives an overall lsquostarrsquo rating for each vehicle within each vehicle category (small medium luxury sports etc)

The data on which the scores are derived are provided voluntarily by the vehicle manufacturers however this data is based on mandatory Australian Design Rule certification test data

The Guide uses a 5 star rating system however it also assigns half stars resulting in a total of 10 levels

The Greenhouse Ratings are based on carbon dioxide emissions and the Air Pollution Ratings take into account the relative environmental impact of oxides of nitrogen hydrocarbons and particles The relative harmfulness of the pollutants (shown in table below) has been quantified based on the allowable concentrations under the Ambient Air Quality National Environment Protection Measure (NEPM)

Green Vehicle Guide Weighting of Regulated Vehicle Emissions

Vehicle Emission

(equivalent pollutant under Air NEPM)

Calculated

Relative

Harmfulness

Final

Weighting

Carbon Monoxide (CO) 0088 Not included

Oxides of Nitrogen (NOx) (based on

Nitrogen Dioxide)

4 1

Hydrocarbons (HC) (based on

photochemical oxidants as ozone)

5 1

Particulate Matter (PM) (based on PM10) 20 5

Source Real and Jones 2005

NOx and HC were given equal final weightings despite the slight difference in the calculated relative harmfulness primarily because under ADR7900 a combined HC+NOx limit is prescribed rather than individual limits for each pollutant

The higher weighting for particulate matter recognises its significant health impacts The Air Pollution rating scale was devised in such a way that a lsquotypicalrsquo car (that is most petrol engined passenger cars meeting the current emission standard at the time) receives a mid-point rating (5 out of 10)

66

The overall rating or stars is derived from the sum of the air pollution and greenhouse scores ie they are equally weighted

Development of the Green Vehicle Guide (see extract below) involved extensive consultation with vehicle manufacturers

Website Costs

The new highly automated web database which contains data on approximately 1400 vehicles and has sophisticated search facilities cost approximately $200000 to develop plus around $100000 was spent recently to improve the sitersquos usability This compares to the previous low cost database which together with the printed guide cost less than about $80000 per annum The low cost version lacked the automation was only updated annually and did not have the ability to compared vehicles

The manufacturers provide the data on line using special access codes This data is checked by DOTARS before it is uploaded onto the website It takes close to a full time position within DOTARS to administer the website and respond to website related queries

Market Research and Marketing

Before the new greenvehicleguidegovau website was launched DOTARS commissioned consumer surveys to determine the level of knowledge about the environmental impacts made by vehicles This research showed that around half of those surveyed had the belief that ldquoall new cars have the same level of impact on the environmentrdquo

It became apparent through the surveys that there was a need to provide consumers with meaningful information on the relative performance of different vehicles This was a view shared by the Productivity Commission who said that while markets provide extensive information to consumers regarding fuel consumption of motor vehicles ldquothe Australian Governmentrsquos Fuel Consumption Labelling Scheme and Green Vehicle Guide provide relatively low cost accessible and comparable information to consumers and may be justified as part of the more fundamental objective of encouraging consumers to reduce the adverse environmental impacts of motor vehicle userdquo The Productivity Commission also commented that government

67

sources of information of this type were seen as credible and reliable and held in higher regard than information provided by others

DOTARS has scheduled some follow up consumer research for 200062007

DOTARS has spent about $600000 in marketing the Green Vehicle Guide This has included advertising in weekend guides in newspapers developing facts sheets plus targeted marketing to motor vehicle journalists

Summary Website - voluntary but legislative base

4 Government-Industry Partnership programs

Government-Industry Partnerships are the basis of many environmental initiatives and can take a number of forms Industry and government negotiate the terms of the program which are normally detailed in a formal agreement which sets out the environmental objectives and the responsibilities of each party towards their achievement

The GovernmentIndustry Partnership programs outlined below indicate the varied nature of these initiatives

41 The National Packaging Covenant

The National Packaging Covenant (the Covenant) commenced in 1999 and is a voluntary agreement between all levels of government and companies throughout the packaging chain including raw material suppliers packaging producers and retailers The Covenant commits signatories to the implementation of best practice environmental management in areas such as packaging design production and distribution and research into life cycle issues Signatories to the Covenant produce action plans on the measures they will implement to reduce packaging waste and they report annually on their progress In this sense the Covenant provides flexibility to signatories to develop plans suitable to their own circumstances The Covenantrsquos success (it currently has over 600 signatories) is due to the active promotion of it by Government and key industry players

The Covenant is complemented by a regulation the National Environment Protection (Used Packaging Materials) Measure (the NEPM) which enables states and territories to use enforcement action to require companies that donrsquot sign the agreement to take steps to reduce their packaging waste Preceding the Covenant and the NEPM were a number of voluntary industry agreements but these were limited in scope and largely focused on companies in the beverage industry

42 National Industry Reduction Agreement

The Publishers National Environment Bureau (PNEB) was formed in 1990 as an association of the major publishers of newspapers and magazines in Australia to promote the recovery and recycling of old newspapers and old magazines primarily from community kerbside collections organised by local councils

68

The PNEB and a newsprint manufacturer have voluntarily entered into a series of five-year Industry Waste Reduction Agreements with the Commonwealth and State Governments Under the current (third) plan 2001-2005 newsprint recycling in Australia has grown to 754 nationally in 2005 from the 28 level when the PNEB was formed in 1990

43 StateLocal target based programs

There have been a number of agreements signed by state government departments and an industry group where there is a stated goal to reach a specific environmental target For example in the early 1990s there was a voluntary agreement with the EPA Victoria and companies in the Altona Chemical Complex in the western suburbs of Melbourne (which includes Australian Vinyls BASF Dow Chemicals and Qenos) to reduce hydrocarbon emissions by 50 within a specified timeframe The target was met and further emissions reductions were negotiated The NSW EPA-Oil industry petrol volatility agreement outlined below is another example of a target based program

44 NSW EPA-Oil Industry Memorandum of Understanding on Summer Petrol Volatility

In 1998 NSW established arrangements for the supply of low volatility petrol in summer in the Sydney Greater Metropolitan Region implemented through a Memorandum of Understanding between the then EPA and oil companies The principal reason for controlling petrol volatility in summer is to reduce evaporative emissions of VOCs (from vehicles and production and storage sites) which contribute to ozone formation

The Memorandum of Understanding operated over four summer periods from 1998 to 2002 and involved companies voluntarily reducing petrol volatility (measured in kilopascals (kPa) of vapour pressure) over three summer periods from a base of 76kPa to 70kPa in the first summer 67kPa in the second and 62 kPa in the last two years

Although the Memorandum of Understanding was successful in progressively reducing petrol volatility over the period of its operation it was not supported by all industry members Consequently agreement was reached with industry that summer petrol volatility limits should be regulated to ensure a level playing field for all industry participants and regulated limits will apply from the summer of 200405

69

5 Summary of Australian Benchmark Programs

Program National State

Summary of Approach Impact

Voluntary Programs Altona Chemical Complex (Vic)

Local Small industry group worked towards self determined targets

Very high

Energy Star National Standards based label Limited Gas appliance Rating Scheme

National Industry operated labelling scheme with stars assigned therefore has graded benchmarksminimum performance standards out dated web database being developed

Low

National Industry Reduction Agreement

National Small industry group worked towards negotiated targets

High

NSW EPA-Oil Industry MOU

State Small industry group worked towards negotiated targets but not all involved ndash lead to regulations

Moderate

Top Energy Saver Award

National Achievement based label Limited

Quasi Regulatory Green Vehicle Guide

National Well promoted web database star ratings assigned therefore has graded benchmarks data provided voluntarily but backed by ADR requirements

High

Stand-by power National Required to achieve voluntary targets or regulation will be introduced

Unknown

National Packaging Covent

National Performance based targets backed by legislation High

Regulatory Energy Efficiency Labels

National Labelling scheme with stars assigned therefore has graded benchmarksbased on Australian Standard web database

High

MEPS National Sets base benchmark and works with energy rating

High

WELS Scheme National Labelling scheme with stars assigned therefore has graded benchmarksbased on Australian Standardweb database

High

Wood heaters State Only one benchmark assigned regulations are not uniform

Moderate

authorrsquos assessment based on direct or indirect knowledge of these programs

70

Appendix 3 Productivity Commission Comments on Labelling and Minimum Performance Standards

The Productivity Commission an independent agency which is the Australian Governmentrsquos principal review and advisory body on microeconomic policy and regulation recently examined the cost effectiveness of improving energy efficiency As part of its review lsquoThe Private Cost Effectiveness of Improving Energy Efficiencyrsquo it examined labelling programs minimum mandatory energy efficiency requirements and other means of providing consumer information The final report contains some highly relevant material that is applicable to establishing a benchmarking scheme for small engines

The following is a summary of relevant conclusions from the Inquiry

Government Operated Labelling Schemes

From consumer research provided to the Commission it concluded that ldquothere is some evidence to suggest that consumers are now paying more attention to labels than they have in the pastrdquo

The Commission was positive about labelling programs as labels

bull directly address ldquoa source of market failure mdash the asymmetry of information between buyers and sellers of energy-using productsrdquo

bull provide information to the consumer that is readily-accessible and easily-understood and therefore can assist in helping the consumer make better-informed choices

bull are likely to have produced net benefits for consumers

bull do not directly limit consumer choice

bull could provide a greater incentive for suppliers to sell products that use energy cost effectively

bull probably produced net social benefits

bull are most suited where there is a wide spread in the range of performances of comparable appliances and where information failures are most pronouncedrdquo

bull can be used to warn consumers that an appliance is very inefficient (through a disendorsement label) which could be effective in discouraging but not preventing consumers from buying the poor performing product

The Commission was supportive of Governmentrsquos role of drawing together and packaging information through labelling programs as this ensures that ldquorelevant and trusted information gets to those who would otherwise not get itrdquo In material reviewed by the Commission George Wilkenfeld and Associates and Energy Efficient Strategies (1999) claimed that labelling is unlikely to be effective if purchasers rarely inspect appliances in a showroom where they can compare performance across

71

different models or the purchaser is not the ultimate user and so has little interest in operating costs

Labelling programs involves both administration and compliance costs such as those incurred by suppliers in having their products tested but the Commission considered that labels should be more actively considered as an alternative to minimum performance standards

Minimum Performance Standards

Governments can prevent the sale of inefficient products by using minimum standards for example the Minimum Energy Performance Standards (MEPS) that apply to appliances such as refrigerators and freezers air conditioners and electric water heaters If appliances do not meet the minimum standard they cannot be sold in Australia Some appliances are covered by both MEPS and by labelling (for example refrigerators)

The Commission considered that MEPS and labels can be complementary as MEPS act to penalise the worst energy performers whereas labels rewarding the better performers

Costs comparisons of schemes

The Department of the Environment and Water Resources provided details about the costs involved in administering both the labelling scheme and the minimum performance standards for energy programs It stated that

bull the administration costs of MEPS are substantially lower than for labelling but the compliance costs can be higher

bull MEPS can have a greater cost for suppliers than labelling since suppliers must adjust their model ranges to meet the MEPS levels by the given date These compliance costs are however influenced by the lsquolead inrsquo time between the introduction of the regulatory proposal and the implementation of the MEPS

bull it is estimated that the administration costs for MEPS would be $3 million over the period 2000ndash15 compared to $39 million for labelling (in present value terms) (George Wilkenfeld and Associates and Energy Efficient Strategies 1999) Furthermore it was assumed that 84 per cent of administration costs were borne by appliance purchasers with the remainder borne by governments

It estimated that MEPS would increase the cost of appliances by $266 million over 2000ndash15 compared to $688 million for labelling (the latter cost being due to consumers voluntarily purchasing more efficient appliances)

72

Page 9: Outdoor Garden Equipment - Department of the Environment

Figure E1 Compliance with overseas standards for popular categories ldquoPhase 1 equivrdquo means the engine complies with US EPA phase 1 or 200288EU ldquoPhase 2 equivrdquo means the engine complies with US EPA Phase 2 Euro I or Euro 2 ldquoUnknown means that engine cycle (stroke) was not provided

Measures to Increase Sales of Low Emission Garden Equipment Engines

There is a range of options that could be considered for reducing emissions from engines used in outdoor garden equipment engines in Australia These include

1 Maintaining the Status Quo

2 Government ndash Industry Partnership Program

3 Quasi regulation

4 Co-regulation

5 Regulations based on either a simple benchmark or tiered benchmarks

The Small Engine Expert Panel ndashOutdoor Equipment has considered in depth the most appropriate approach to take to improve the emissions performance of outdoor garden equipment sold in Australia It recommends the introduction of national regulations to control the emissions from outdoor garden equipment particularly in light of the increase in cheap imports onto the Australian market which although untested are considered very likely to have high emission levels The Expert Panel has developed some broad recommendation on which Australian regulations could be based which takes in consideration the local market and Victa These are summarised as follows

1 Mandatory air pollutant emission standards to be introduced in Australia for all outdoor equipment (lt19kW) powered by spark-ignition engines

v

The development of any regulation would need to be based on a formal assessment of the costs and benefits of nationally regulating two and four stroke lawn mowers and handheld power equipment which should commence immediately

2 Proposed standards to mirror US EPA regulations (compliance with equivalent EU regulations also acceptable)

3 Timing (subject to completion of assessment of costs and benefits)

(a) US EPA Phase 1 ndash Effective from 20072008

(b) US EPA Phase 2 ndash Fully implemented in 2012 (in step with 2007 USEPA limits) plus a phase-in period andor provisions for averaging banking and trading (ABT) of emissions over 2008-2012 to provide for early introduction of cleaner product

The US EPA Phase 1 and Phase two emissions limits are given in the table below

4 Walk-behind two stroke mowers to be included in US EPA Category 5 (gt50cc) product classifications (to provide Victa time to develop a cleaner engine) Implementation timing is proposed to be the same as Recommendation 3 above

5 All products also to be certified to relevant EPA product durability categories

6 Subject to further review ABT if included may be phased out after 2012

Table E1 Comparison between the USA Phase 1 and Phase 2 standards

Emission Limits GkW-hr

Phase 1 (1997 ndash2001) Phase 2 (2007) HC NOx HC+NOx CO HC+NOx CO

Non-handheld

I-A lt66cc 161 161 610

I-B 66-lt100cc 161 161 610

I 100-225 cm3 161 519 161 610

II 225 cm3 134 519 121 610

Handheld

III lt20 cm3 295 536 805 50 805

IV 20-50 cm3 241 536 805 50 805

V 50 cm3 161 536 603 72 603 Phase 2 limits were phased in between 2002 -2007 during which time they became tighter

For simplicity only the 2007 are shown in this table (see Table 2 for more details)

vi

Conclusion

From this review it is apparent that it is highly unlikely that the companies in the industry would engage in or commit to any voluntary type program It is therefore clear that the most expedient path to reduce emissions from these small engines is through national regulation State based regulations could only provide a piecemeal approach that would lead to product dumping in states where there are no regulations and inconsistent regulations that require industry to treat each state market differently In addition enforcement of any state based regulations would be a key problem due to existing Commonwealth and State Government mutual recognition legislation

While any national regulation of emissions from small engines used in garden equipment in Australia are likely to be based on overseas regulations they need to strike a balance between improved environmental outcome harmonisation with international standards and the characteristics of the local industry With regulations optimum emissions reduction are potentially achievable by combining minimum emissions standards with tiered product labelling Whether this approach is justifiable on economic grounds that is the benefits outweigh the costs can only be determined through a detailed impact assessment Based on these findings it is recommended that a formal assessment of the costs and benefits of nationally regulating two and four stroke lawn mowers and handheld power equipment should be commenced

vii

1 Introduction

This report sets out the results of a project to compare and benchmark emissions from engines used in outdoor garden equipment that were available for sale in Australia during 2006 Possible outcomes from the project range from consumer guidelines for selecting low emission engines to regulatory controls on emissions There are currently no state or national regulations that directly control emissions from these engines

The project was commissioned by the Commonwealth Department of the Environment and Water Resources on behalf of state and territory government departments working on reducing the impacts of small engine emissions This report was prepared in consultation with an Expert Panel that included representatives from the Outdoor Power Equipment Association (OPEA)

11 Emissions from outdoor garden equipment engines

Small engines particularly conventional two stroke engines used in applications such as outdoor garden equipment are high polluters relative to their engine size and usage1 These small engines emit volatile organic compounds (VOCs) and oxides of nitrogen (NOx) which contribute to ozone (photochemical smog) formation in summer They also emit particles carbon monoxide (CO) and a range of air toxics such as benzene The USA California Canada and Europe and regulate emissions of VOCs NOx carbon monoxide and particle emissions from outdoor garden equipment

There are five types of spark-ignition engines that can be used in outdoor garden equipment

bull two stroke with carburettor (2c)

bull two stroke with pre-chamber fuel injection (2i)

bull two stroke with direct fuel injection (2di)

bull four stroke with carburettor (4c)

bull four stroke with fuel injection (4i) (includes direct injection)

Carburettor and pre-chamber fuel injection two stroke engines are inherently more polluting than the other three types This is due to their inability to completely separate the inlet gases from the exhaust gases resulting in up to 30 of the fuel being left unburnt and the need to add oil to the fuel to lubricate the engine (four stroke engines have separate reservoirs for fuel and oil) However twostroke carburettor engines typically weigh less than a four stroke engine of the same power and this tends to make them attractive for handheld equipment They also tend to have fewer components are generally cheaper to purchase and are cheaper to maintain than

1 Outdoor equipment covered in this report are engines less than 19kW

1

four stroke motors Victa Lawncare is currently undertaking research and development to improve the environmental performance of two stroke carburettors and while some emission improvements have been made a two stroke compliant with US or European standards is still considered several years away

Four stroke carburettor engines are generally quieter more fuel efficient and are less polluting than conventional two stroke engines

Direct fuel injection (dfi) either two stroke or four stroke overcomes the unburnt fuel problem and can meet the stringent regulated exhaust emission limits that apply overseas However there is not any evidence that dfi engines are being used in outdoor garden equipment available in Australia It appears that engines used in outdoor garden equipment in Australia are generally restricted to two and four stroke carburettor engines

Small engines are not as advanced in environmental terms as motor vehicle engines As a result even the better-performing small engines emit far greater quantities of pollutants per hour than typical modern car engines For example the US Environmental Protection Agency (USEPA) 2002 limit for a typical 4 kilowatt (kW) lawnmower motor is about 66 grams (g) of regulated pollutants per hour of operation A typical 08kW brushcutter sold new in 2002 emitted about 160grams of pollutants per hour - reducing to 40grams per hour if bought new in 2006 The equivalent limit for cars under Australian Design Rule 79 is about 16g per hour In other words operated over a similar time one hour of operation of a brushcutter that meets USEPA 2002 limits produces the same pollution as ten cars and a 4kW lawnmower the same pollution as four cars These comparisons are subject to differences in test methods but they do provide an indication of the disproportionate amount of pollution emitted by small engines

Engines that do not comply with current USEPA requirements are likely to emit several times the amount of pollution calculated in the above example Therefore the worst performing engines are likely to emit some ten times the emissions of the best performers

Because of the combustion of oil these engines also emit high levels of particles Although small engines only contribute a small amount to total particle emissions the rate of particle release compared to other engines can be very high For example lawnmowers can emit over 10 times more particles (in terms of grams per hour) than a petrol motor vehicle (manufactured between 1994 and 2001)

All the above emission comparisons between outdoor garden equipment engines and motor vehicles are subject to differences in test methods but they indicate the disproportionate amount of pollution emitted by small garden equipment engines It also needs to be recognised that motor vehicles in Australia average more than 15000 kilometres per year (ABS 2003) while the annual average use of outdoor garden equipment is around 25 hours for a lawnmower and less for other types of equipment Commercial operators however are likely to have a much higher usage rates than the general public

2

This paper examines the Australian market for small engines used in lawnmowers and handheld garden equipment their impact on air quality relevant overseas regulations and their applicability to Australia and makes recommendations to reduce air quality impacts from these engines

A wide range of information sources has been referenced for this report including data and information supplied by manufacturers distributors and dealers in small engines

3

2 Air Quality and Outdoor Garden Equipment Engines

Emission inventories make estimates of emissions of substances from a multitude of sources into airsheds The National Pollutant Inventory (NPI) which is run cooperatively by the Australian state and territory governments contains data on 90 substances that are emitted to the Australian environment The substances included in the NPI have been identified as important because of their possible health and environmental effects Industry facilities estimate their own emissions annually and report to states and territories Non-industry (or diffuse) emissions estimates which includes emissions from outdoor garden equipment are made by the states and territories on a periodic basis using information sources such as surveys databases and sales figures

The NPI only reports emissions from domestic lawn mowing and for a few airsheds the contribution made by public open space lawn mowing It does not report on the contribution made by other types of outdoor garden equipment such as brushcutters National and selected state NPI emissions estimates for the common air pollutants and for Air Toxics NEPM pollutants from domestic lawn mowing are summarised in Table 1 It should be noted that national emissions from lawn mowing are underestimates as the NPI records emissions for major airsheds only and therefore is not Australia wide plus the estimates do not include evaporative emissions from fuel tanks and hoses

This NPI data is indicative only as the accuracy and completeness of the data sets varies across airsheds and is reliant on the estimation techniques used For example while the population in the NSW is higher than other airsheds its emissions look disproportionally high when compared to the other airsheds This could be because the estimation technique varies or it is due to some other factor

4

Table 1 National Pollutant Inventory Domestic Lawn Mowing Emission Estimates

Substance Port Phillip

Population 34 mill (1996)

SE Qld

Population 23 mill

NSW GMR

Population 47 mill

Adelaide

Population 10 mill

National

Common Air Pollutants (tonnesyear)

Carbon monoxide 12000 12000 24000 6100 69000

Total Volatile Organic Compounds 3600 3800 7000 2000 21000

Particulate Matter 100 um 86 94 170 9 460

Sulphur dioxide 5 5 9 50 81

Oxides of Nitrogen 63 54 120 24 330

Air Toxics (tonnesyear)

Benzene 230 210 390 130 1200

Formaldehyde 56 38 NA 31 180

Polycyclic aromatic hydrocarbons 07 11 21 04 41

Toluene (methylbenzene) 370 360 660 210 2000

Xylenes (individual or mixed isomers) 270 260 490 150 1500

Analysis of the NPI database at the national level shows that domestic lawn mowing is the

- Fourth largest source of benzene contributing 7 to the total reported airshed load

- Fourth largest source of formaldehyde contributing 3 to the total reported airshed load

- Fifth largest source of xylene contributing 6 to the total reported airshed load

- Fifth largest source of toluene contributing 6 to the total reported airshed load

- Sixth largest source of carbon monoxide contributing 12 to the total reported airshed load

- Ninth largest source of VOCs contributing 3 to the total reported airshed load when biogenics (natural sources such as trees and soil) are excluded

The NSW Department of Environment and Conservation has been upgrading its emissions inventory Based on 2003 emissions data non-road anthropogenic sources

5

contribute 619 of the VOCs to the GMR airshed Preliminary results2 indicate that VOC emissions from domestic and public open space lawn mowing contributes on an annual average 41 of all VOC emissions in the GMR On a typical weekend during warmer weather this percentage rises to 11

Therefore it could be assumed that lawn mowing could contribute approximately 4 on average to VOC emissions from anthropogenic sources in major airsheds in Australia when public open space lawn mowing is included This percentage is likely to rise significantly in the warmer spring and autumn weekends which is when lawns and other vegetation grow faster and when more people garden

21 Air Quality Standards

In June 1998 the National Environment Protection Measure for Ambient Air (Air NEPM) established national uniform standards for ambient air quality for the six most common air pollutants ndash carbon monoxide nitrogen dioxide photochemical oxidants (measured as ozone) sulfur dioxide lead and particles less than 10 microns (PM10) The NEPM was varied in 2003 to include PM25 advisory reporting standards and in April 2004 a National Environment Protection Measure for Air Toxics was adopted

Nationally the common pollutants of most concern (particularly in major urban areas) are fine particles and ground level photochemical smog (measured as ozone) which is formed in the warmer months when volatile organic compounds (VOCs) and oxides of nitrogen (NOx) react in the atmosphere under the influence of sunlight in a series of chemical reactions

Recent health studies (cited in NEPC 2005) have strengthened the evidence that there are short-term ozone effects on mortality and respiratory disease The studies also strengthen the view that there does not appear to be a threshold for ozone below which no effects on health are expected to occur In recent years Australian epidemiological studies have been conducted which confirm the results of overseas studies that there is a relationship between elevated ozone levels and hospitalisations and deaths from certain conditions

There are two national ozone standards a one hour standard of 010ppm and a four hour standard of 008ppm with a goal that allows for one exceedance per year by 2008 Sydney experiences a number of days each year of ozone levels above these standards In 2003 Sydney exceeded the one hour standard on 11 days in 2003 19 days in 2004 and 9 days in 2005 The four hour standard was exceeded on 13 days in 2003 19 days in 2004 and 13 days in 2005 Further reductions in VOC and NOx emissions are needed to reduce ozone concentrations in Sydney to levels that would comply with the Air NEPM

The other jurisdictions meet or are close to meeting the current National Environment Protection (Ambient Air Quality) Measure (Air NEPM) ozone standards (NEPC 2005) However the ozone standards are being reviewed and based on current human health evidence the argument appears to be strengthening for tighter ozone standards

2 Presentation to Expert Panel 27 April 2006 by Nick Agipades Manager Major Air Projects NSW DEC

6

Should a stricter standard or an eight-hour standard consistent with international standardsguidelines be adopted achievability of Air NEPM ozone standards or goals could become an issue for some of the other major urban airsheds (NEPC 2005)

Modeling of ozone for Sydneyrsquos Greater Metropolitan Region (GMR) indicates that the implementation of Euro emission limits for on-road vehicles and hence the increased presence of these less polluting vehicles in the fleet and retirement of old more polluting vehicles from the fleet is not sufficient to meet the current NEPM goals Modeling suggests that very large reductions in precursor emissions would be required to meet the current ozone one hour goal (NEPC 2005)

Even when the effects of bushfires and when hazard reduction burning are taken into consideration airsheds such as Launceston Melbourne and Sydney struggle to meet the national standards for particles (EPA 2006) However outdoor powered equipment predominantly from two stroke engines makes only a minor contribution to ambient fine particle loads

While carbon monoxide emissions from engines used in outdoor garden equipment are regulated overseas air monitoring in Australia indicates that carbon monoxides levels are well below the national air quality standards and there are no pressing issues requiring CO from outdoor powered equipment to be regulated In addition data indicates that lowering emissions of VOCs and NOx from small engines reduces CO emissions

Many of the pollutant sources which contribute to the formation of ozone and to particle levels also contain air toxics such as benzene toluene formaldehyde and xylenes These air toxics have been shown to be responsible for a range of health problems including asthma respiratory illnesses and cancer The National Environment Protection Measure for Air Toxics requires each jurisdiction to monitor and report annually on five air toxics benzene polycyclic aromatic hydrocarbons formaldehyde toluene and xylenes The monitoring data is intended to inform future policy and also the public on ambient levels of these air pollutants Monitoring of air toxics to date shows that levels are low and below the national monitoring investigation levels (EPA Vic 2006 DEC 2006)

7

3 Emission Standards for Small Engines

31 Australia

At present there are no Australian regulations or standards to limit air pollutant emissions from small (two and four stroke) engines Australia does benefit to some extent from overseas regulations as many lawnmowers and other gardening equipment sold in Australia have engines manufactured in the United States or Europe where strict standards apply

32 United States

In the United States emission regulations set by the United States Environmental Protection Agency (USEPA) and the Californian Air Resources Board (CARB) apply to lawn mowers and other powered gardening equipment Although CARB standards currently tend to be stricter than USEPA standards by 2006 emissions limits applying under the two standards will be very similar

United States Environment Protection Agency (US EPA)

In 1995 the USEPA introduced ldquoPhase 1rdquo regulations covering small non-road engines with a power of not more than 19kW (25HP) The regulations applied to equipment manufactured from 1997

These regulations have seven classes of equipment based on portability and engine displacement volume (ldquocapacityrdquo) In March 2000 the USEPA published ldquoPhase 2rdquo regulations which are shown in Table 2 These set limits for combined emissions of hydrocarbons (HC) and oxides of nitrogen (NOx) and separate limits for carbon monoxide (CO) emissions and for two stroke engines only particles

Table 2 US EPA Phase 2 Small Engine Emissions Standards (HC+NOx in gkW-hr) (a) (b)

Small Engine Class

Type 2002 2003 2004 2005 2006 2007+

I-A (lt66cc) Non-handheld (eg lawnmowers)

- 161 161 161 161 161

I-B (66 to lt 100cc) - 161 161 161 161 161

I (100 to lt 225cc) - 161 161 161 161 161

II (225cc or more) 180 166 150 136 121 121

III (lt20cc) Handheld (eg trimmers)

238 175 113 50 50 50

IV (20 to lt50cc) 196 148 99 50 50 50

V (50cc or more) - - 143 119 96 72 (a) As carbon monoxide (CO) levels in Australia are well below the Air NEPM standard the

USEPA emission limits for CO have not been included in this table (b) Includes useful life criteria of 50125300 hours

8

When the USEPA introduced ldquoPhase 2rdquo regulations it included averaging banking and trading provisions (ABT) which were seen ldquoas an important element in making stringent Phase 2 emissions standards achievable with regard to technological feasibility lead time and costrdquo (USA 1999) The USEPA also claimed (USA 2000) that the ABT program secures early emissions benefits through the early introduction of cleaner engines

ABT provisions which apply to handheld and non handheld engines are complex but in broad terms averaging means the exchange of emission credits among engine families within a given engine manufacturerrsquos product line This allows a manufacturer to produce some engines that exceed the standards and offsetting these exceedances with emissions from engines that are below the standard Manufacturers are allowed to exchange credits from handheld to non handheld and vice versa Banking means the retention of emission credits by the engine manufacturer generating the credits for use in a future model year (for averaging or trading) Trading is the exchange of emission credits between engine manufacturers which then can be used for averaging purposes banked for future use or traded to another engine manufacturer

In January 2004 USEPA reported that in 2002 averaging was being used but there was very little use of banking It determined that the initial ABT programs as too complex and included discount rates on credits ABT was simplified in 2004 including the elimination of credit discount and multipliers and limits on credit life To date there has reportedly been limited use of banking however it is anticipated that there will be more widespread use of banking credits if the USEPA proposed Phase 3 comes into effect3 (see below)

Particulate limits (2gkW-hr) also apply to two stroke engines Carbon monoxide and durability limits (or useful life) are also prescribed The durability criteria which were introduced in Phase 2 require that the emission limits must be met through the useful life of the engine The manufacturer determines useful life of each product using standardised product testing procedures and then based on the test results selects the useful life category for each product which can be 125 250 or 500 hours These durability criteria acknowledge the large disparity in usage patterns by equipment type and between commercial and residential users It also takes into account the ability of manufacturers to design and build engines for various design lives and which fit the types of equipment engine is produced for

The March 2000 USEPA report (USEPA 2000) estimated that the expected effects of the Phase 2 regulations would be

bull A 70 reduction in HC+NOx beyond the Phase I standards (which were estimated to have reduced emissions by 32 from the unregulated baseline)

bull A 30 reduction in fuel consumption of small handheld equipment bull Price increases of between $US23 (Class III) and $US56 (Class V) for

handheld equipment

3 Dave Gardner Briggs and Stratton email 22506

9

The US EPA is currently considering lsquoPhase 3rsquo regulations which are catalyst based standards to further reduce exhaust HC and NOx emissions from non handheld engines reduce evaporative HC and NOx emissions for both handheld and non handheld engines plus include extended durability criteria These limits are currently at discussion stage only They align with CARB Tier 3 but a longer lead time is proposed

Table 3 Proposed Phase 3 Exhaust Emissions

HC+NOx gkW-hr

CO gkW-hr

Year Useful life hrs

Class I 100 610 2010 125250500

Class II 80 610 2011 2505001000

Class III-V No changes

HC+NOx std is based on averaging

Californian Air Resources Board (CARB)

Spark ignition engines

CARB regulations first introduced emission limits for small engines manufactured from1995 The more recent schedule of emission limits are shown in Table 4 These limits depend solely on the engine capacity and apply to both handheld and non handheld classes

Table 4 CARB Emission Limits for Small Engines (HC+NOx in gkw-hr)

Engine Capacity 2000-2001 2002-2005 2006+

65cc or less 72 72 72

gt65cc to 225cc 161 161 161

gt225cc 134 121 121

California has particle limits for two strokes useful life criteria and mandatory engine labeling including a consumer advisory hang tag as shown in Figure 1 The USEPA is also considering introducing an air index label

10

Figure 1 Example of a Californian Consumer Advisory Hang Tag The Californian regulations take into account sales weighted emission performance for families of engines An engine family is essentially the same engine being used in different equipment items

In 2003 California adopted a Tier 3 program for exhaust and evaporative emissions and these are based on the use of catalytic convertors The engine classes better align with US EPA categories however the exhaust standards for Class I and Class II are more stringent than the existing US EPA standards

Table 5 CARB Tier 3 for Exhaust Emissions

Model Year Displacement Category

Durability Periods (hours)

HC+NOx gkw-hr

CO gkw-hr

Particulate gkw-hr

2005 and subsequent

lt50 cc 50125300 50 536 20 + 50-80 cc inclusive 50125300 72 536 20 +

2005 gt80 cc - lt225 cc Horizontal-shaft eng

125250500 161 549

gt80 cc - lt225 cc NA 161 467 Vertical-shaft Engine 225 cc 125250500 121 549

2006 gt80 cc - lt225 cc 125250500 161 549 225 cc 125250500 121 549

2007 gt80 cc - lt225 cc 125250500 100 549 225 cc 125250500 121 549

2008 and subsequent

gt80 cc - lt225 cc 125250500 100 549 225 cc 1252505001000 80 549

the 1000 hours is applicable for 2008+ Model Year (MY) + applies to 2 stroke only Source California Exhaust Emission Standards and Test Procedures For 2005 And Later Small Off-Road Engines Adopted July 26 2004 effective on October 20 2004

California also has Blue Sky provisions These are voluntary standards for engines that meet the criteria shown in Table 6 Blue Sky Series engines are not included in

11

the averaging banking and trading program Zero-emission small off-road equipment (eg push mowers) may certify to the Blue Sky Series emission standards

In 2005 CARB aligned its test procedures with the USEPA

Table 6 CARB Blue Sky Provisions

Model Year Displacement Category

HC+NOx gkw-hr

CO gkw-hr

Particulate

2005 and subsequent lt50 cc 25 536 20

50 - 80 cc inclusive 36 536 20

2007 and subsequent gt80 cc - lt225 cc 50 549

2008 and subsequent 225 cc 40 549 Applicable to all two stroke engines

33 Canada

The Canadian small engine market has similarities to the Australia market the majority of small engines are imported from the USA and there is one Canadian manufacturer of small spark ignition engines and one major manufacturer of lawn and garden machines

A Memorandum of Understanding (MOU) which came into effect on 1 January 2000 was signed between Environment Canada and ten manufacturers of handheld equipment and nine manufacturers of engines used in non handheld machines The MOU was intended as an interim measure until regulations could be put in place Under the MOU the manufacturers agreed to voluntarily supply small spark ignition engines designed to meet the applicable USEPA Phase 1 emission standards

In 2003 Canada regulated emission limits for handheld and non-handheld small engines based on USEPA emission limits The regulations apply to model years 2005 and later While there are no separate averaging banking and trading provisions in Canadian regulations Canada allows any USEPA certified engine to be sold in Canada This means that engines that do not meet the standard level but are averaged (or use credits) in the United States can be sold in Canada Manufacturers are required to produce upon request evidence of conformity to the standards and are required to provide written instructions on engine maintenance to the first retailer

12

Table 7 Canadian Small Spark-Ignition Engine Exhaust Emission Standards

Engine class

Engine Type

Engine Displacement (cm3)

Effective date (model year)

Standard HC+NOx (gkWshyhr)

Standard NMHC+NOx (gkW-hr)

Standard CO (gkWshyhr)

I-A Non-handheld lt66 2005 and

later 50a -shy 610a

I-B Non-handheld

lt100 and 66

2005 and later

40a 37a 610a

I Non-handheld

lt225 and 100

2005r 161b 148a 519b 610a

II Non-handheld 225 2005 and

later 121a 113a 610a

III Handheld 20 2005 and later 50a -shy 805a

IV Handheld lt50 and 20 2005 and later

50a -shy 805a

V Handheld 50 2005 2006 2007 and later

119a 96a

72a

-shy-shy

-shy

603a 603a

603a a Standards apply throughout the engine useful life b Standards apply only when the engine is new Source Canada Gazette Part II Vol 137 No 24 2003-11-19

34 Europe

In 1998 the European Union introduced exhaust emission limits for small petrol engines through Directive 9768EC and in 2002 introduced amendments through Directive 200288EC The limits in the Directives align with the US regulations however they do not have averaging and banking provisions

Table 8 European Emissions Standards

Small Engine Class Type (HC+NOx in gkW-hr) 2004 2005 2006 2007 2008

SN1 (lt66cc) Non-handheld (eg lawn mowers)

161 161 161 161 161

SN2 (66 to lt 100cc) 161 161 161 161 161

SN3 (100 to lt 225cc) - - - 161 161

SN4 (225cc or more) - - 121 121 121

SH1 (lt20cc) Handheld (eg trimmers)

- - - 50 50

SH2 (20 to lt50cc) - - - 50 50

SH3 (50cc or more) - - - - 72

13

The European Union is currently considering including useful life criteria and averaging and banking provisions plus it is considering introducing a Directive to further reduce emissions from diesel engines The objective of the proposal is to tighten emissions standards for engines in general non-road applications in light of technological developments and it taking into account the parallel developments for similar legislation in the United States in order to harmonise the environmental standards and to facilitate trade

Charts comparing the USA Californian and European Emission Limits are shown below

14

35 Summary of Regulations for Non Handheld Equipment

KEY TO CHARTS

USEPA CARB EU

0

10

20

30

40

50

60

70

80

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

0 to 49cc

0

10

20

30

40

50

60

70

80

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

50 to 65cc

0

2

4

6

8

10

12

14

16

18

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

100 to 224cc

0

2

4

6

8

10

12

14

16

18

20

2000

2002

2004

2006

2008

Year Model

HC

+N

Ox g

kW

-hr

225cc and over (up to 19kW)

15

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

36 Summary of Regulations for Handheld Equipment

KEY TO CHARTS

USEPA CARB EU

20 to 49cc 0 to 19cc

250 250

200

150

HC

+N

Ox g

kW

-hr

100

200

HC

+N

Ox g

kW

-hr

150

100

50 50

0 0

Year Model Year Model

50 to 65cc 66 to 80cc

160

160

140

140

120

40 40

20 20

0 0

120

HC

+N

Ox g

kW

-hr

HC

+N

Ox g

kW

-hr

100100

8080

60 60

Year Model Year Model

16

Summary of Regulations for Handheld Equipment (continued)

KEY TO CHARTS

USEPA CARB EU

0

20

40

60

80

100

120

140

160

2000

2001

2002

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

81 to 224cc

0

20

40

60

80

100

120

140

160

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

225cc and over (up to 19kW)

17

4 Australian Market for Small Engines

41 Likely compliance with overseas emissions standards

As part of this assessment an environmental profile of equipment currently on the Australian market has been developed initially based on information from manufacturersrsquo brochures and web sites and industry magazines and then confirmed through follow-up with relevant industry contacts

Each item of equipment has been assessed on its compliance with USEPA CARB or European regulations In most cases it was not possible to match models available on the Australian market with CARB lists (CARB publishes exhaust emissions data on all appliances on its web site) This was mainly due to the inconsistency of model designations and uncertainty about ldquoengine familiesrdquo

Engine characteristics and retail price were difficult to obtain Some brochures also made claims of compliance with USEPA European or CARB requirements The detailed breakdown of current equipment on the Australian market is given in Appendix 1

The majority of small engines sold in Australia are imported and many come from countries that impose emission limits The extent of imports into Australia that do not comply with the country of origin standards is not known Industry estimates that 40 of garden products are sold through importers who are not linked to manufacturers of US EPA or European certified equipment and the source of some products sold here is difficult to establish Victa is the only company producing small engines in Australia Its iconic 2-stroke lawnmower currently cannot meet overseas emission limits

Outdoor Power Equipment Association (OPEA) assisted in identifying the Australian distributors of most brands of powered garden equipment In April 2006 a survey form was sent to a total of 43 distributors representing 97 brands of equipment The survey form sought information about the engine for all petrol-fuelled garden equipment with a power not more than 19kW

Figure 2 Extract from survey form

18

Initial response to the survey was poor Despite follow-up action and efforts from the industry association at the beginning of September 2006 26 distributors had responded to the survey information and only 13 distributors provided all data necessary for benchmarking purposes This resulted in emission compliance data for about half of the estimated products on the Australian market Attempts to match Australian models with the database maintained by the Californian Air Resources Board were also of limited success due to inconsistencies in model designations between Australia and the USA and the manner in which model information is coded in the CARB database

Table 9 Summary of distributor responses

Responses status Not OPEA OPEA ALL

Number of responses 9 8 (31) 17 (40)

Response - all data 4 9 13 (30)

Response - extra time sought 3 3 (7)

Response - no petrol products 4 1 5 (12)

Response - some data 5 5 (12)

Grand Total 17 26 43 percentages may not add to 100 due to rounding

Of the 97 brands initially identified

bull 16 brands are apparently no longer sold in Australia

bull No responses were received for 29 brands

bull Partial data were received for 12 brands

bull All data was available for 30 brands

Table 10 Summary of responses by brand

Count of brands

Analysis status Not OPEA OPEA All

Missing some data 12 12

No data received 9 (27) 20 (31) 29 (30)

No longer sold 13 3 16

Response - no models to list 3 7 10

Response received (electronic form) 5 11 16

Response received (paper form) 3 2 5

Response received (spreadsheet) 9 9

All 33 64 97

A 2004 report for the NSW DEC estimated that there were about 1200 eligible garden

19

products in the Australian market The current project has obtained data for a total of 870 products or 72 of the estimated population In addition the sampling method is likely to be biased towards products with good environmental performance In these circumstances the following analysis should be regarded as indicative only

Survey results

The following tables and figures show expected compliance with European CARB or USEPA requirements based on the limited information provided by industry

Table 11 Engine type and compliance with overseas standards Count of products Engine type

Best STD 2c 4c Unknown All 1997 - US EPA I 53 32 85 (10) 200288EU 17 17 (2) 2004 - US EPA II 1 3 4 (lt1) 2004 EURO I 8 8 (1) 2005 - US EPA II 10 29 5 44 (5) 2006 - US EPA II 107 141 2 250 (29) 2006 EURO I 6 6 (1) 2007 - US EPA II 1 1 (lt1) 2007 Euro II 2 2 (lt1) None 118 90 208 (24 Unspecified 24 60 161 245 (28) All 344 358 168 870

Unknown means the type of engine is unknown (but is most likely to be 2c) Unspecified means that the status of emissions compliance was unable to be identified None means the manufacturerdistributor has indicated that the equipment does not comply with any overseas emissions standard

Figure 3 Compliance with overseas standards - all surveyed products Note Unknown in chart includes unspecified and unknown from Table 11

20

Figure 4 Compliance with overseas standards by equipment type ldquoPhase 1 equivrdquo means the engine complies with US EPA phase 1 or 200288EU ldquoPhase 2 equivrdquo means the engine complies with US EPA Phase 2 Euro I or Euro 2 ldquoUnknown means that engine cycle (stroke) was not provided

Of the 41 categories of equipment in the survey 15 had at least 10 current products Results for these categories are set out below

Figure 5 Engine type for popular categories

21

Figure 6 Compliance with overseas standards for popular categories ldquoPhase 1 equiv means the engine complies with US EPA phase 1 or 200288EU Phase 2 equiv means the engine complies with US EPA Phase 2 Euro I or Euro 2 ldquoUnknown means that engine cycle (stroke) was not provided

42 Australian Sales of Outdoor Powered Equipment

The Australian Outdoor Power Equipment Association (OPEA) whose membership represents about 80 of the manufacturersdistributors and dealers in the industry commissions regular independent industry audits of garden equipment sales (OPEA personal communications) Sales data from OPEA is shown in Table 12

22

Table 12 Sales of outdoor garden equipment 2002 and 2005-06 2005-06 2 stroke (1000)

2002 2 stroke (1000)

2005-06 4 stroke (1000)

2002 4 stroke (1000)

2005-06 TOTAL (1000)

2002 TOTAL (1000)

Walk behind mowers 72 170 351 76 424 246

Brushcuttertrimmer 321 12 17 180 339 192

Chainsaws 152 0 0 90 152 90

Chipper shredders 0 60 46 0 46 60

Blowerblower vacuums 98 0 11 50 109 50

Ride on mowers 0 25 51 0 51 25

Generators 11 32 96 0 107 32

Hedge trimmers ampothers 40 192 0 28 40 220

694 491 476 424 1267 915

for total sales 593 463 407 537

for mowers 152 280 848 720

According to OPEA approximately 424000 walk behind lawnmowers and more than 792000 units of outdoor handheld equipment were sold in Australia in 2005-06 In addition there were sales of about 80000 replacement engines and 70000 pumps in 2005-06 most of which were four strokes These figures show that there has been considerable growth in the sales of most products with the exception of chipper shredders and the category lsquohedge trimmers and othersrsquo whose sales declined in 2005shy06 compared with those in 2002 About 17 of walk behind lawnmowers were two stroke and 83 four stroke which is an improvement in the uptake of cleaner engines when compared to 2002 when about 30 were two stroke The situation with handheld equipment is reverse with nearly 79 being two strokes compared to 47 in 2002 However many models of two stroke handheld equipment meet current US emission standards and care should be exercised in using engine type (two stroke or four stroke) as an indicator of emissions performance for this class of equipment

The OPEA 2005-06 sales estimates are shown in Figure 7 OPEA cautions that there is considerable uncertainty about the estimates for brushcutters and blowerblower vacuums as OPEArsquos figures only represent 50 and 60 respectively of sales of these products No estimates of future sales trends were identified during research for this project

23

Australian sales of 2 and 4 stroke outdoor equipment 2005-6

0 50 100 150 200 250 300 350 400

Walk behind mowers

Brushcuttertrimmer

Chainsaws

Chipper shredders

Blowerblower vacuums

Ride on mowers

Generators

Other

Annual sales (x 1000)

4s 2s

Figure 7 OPEA estimates of equipment sales in 2005-06 Note Blowervac is an industry term for equipment that combines blowing and vacuuming functions

Briggs and Stratton (Australia) who import engines from the USA supply the majority of the four stroke engines for handheld equipment sold in Australia and these comply with all the current USA and CARB regulations Imported handheld garden equipment is shipped fully assembled to a branch or distributor and is then sent to a retailer The retailer may or may not provide equipment servicing

OPEA members have expressed concern regarding the increasing sales of imported high polluting two stroke engines that allegedly do not meet any emission standards and come from countries that do not have emission standards One industry representative reported that some of the imported trimmers were being manufactured in China using outdated designs and tooling from two old bankrupt American companies and these are being sold here at about 30 of the price of traditional brands and very low cost generators from China now account for around 70 of total sales It is difficult to confirm this trend without undertaking a detailed examination of Australian import data however the significant increase in the sales of two stroke handheld equipment provides some support for this trend

On the other hand it is claimed by industry that the ride on mower market (predominately with compliant four stroke engines) has been stimulated by the Australian USA free trade agreement

24

5 Australian Users of Small Engines This section examines the market segments for garden equipment and customer purchasing behaviour

51 General Public

Purchasing behaviour

Research into consumer purchasing behaviour has found that consumers assess a product against a range of attributes for example price weight brand reputation servicing and parts availability warrantees and guarantees experience size promotions and discounts Studies have also revealed that up to 82 of Australians had bought products on the basis of social or environmental factors in the previous year (State Chamber of Commerce 2001) Related to this point the energy star rating ecolabel on whitegoods was viewed as a credible environmental claims system which is well regarded by the general consumer (Product Category Manager Mitre 10 personal communications)

As the purchase of small engine garden equipment by the general consumer is an infrequent purchase which carries a certain of amount of risk With small engines the risk can be functional risk (will not perform as expected) physical risk (for example safe features such automatic cut out on an electric lawn mower) or financial risk especially for the more expensive items The general consumer is likely to lessen the risk by seeking information and by evaluating the information on the available products over a period of time The consumer may also lessen the risk by

bull purchasing well known brands

bull buying the brand offering the best warrantees and guarantees

bull buying the most expensive brand and

bull buying a brand they have used before

Research indicates that the desired attributes of a product may not be well established at the start of a consumerrsquos search process but will often be refined as the consumer learns more about the product The consumer will also use a ranking and weighting process based on desired qualities and trade offs may be made

Reportedly purchases of engine operated garden equipment are based on price yard size fitness for purpose and other features such as weight and ease of starting (Product Category Manager Mitre 10 personal communications) Males are the predominant purchasers of garden equipment however because of changing demographics there has been an increase in the number of women purchasing these products

Less than 5 of lawnmowers purchased are push or electric mowers (Product Category Manager Mitre 10 and industry sources personal communications 2003)

25

Electric mowers are generally perceived as not being as effective as cords have limited range and rechargeable electric mowers require frequent recharging

There is a recent trend towards ride on mowers (all four strokes) probably because of changing demographics specifically older age groups moving to more rural environments with larger yards (OPEA personal communications)

A study (Wilkie 1994) investigated consumer appliance purchasing behaviour and found that the general consumer consulted a range of information sources before purchasing an appliance The appliance salesperson was found to be the most important information source for many consumers Other important information sources include newspaper advertisements friends and relatives catalogues consumer reports and brochureslabels Since Wilkiersquos study the internet will have become increasingly important as a research tool and in some instances as a way to purchase products As part of this study there is evidence of low priced products being sold into the Australian market via the internet only ndash a practice that is likely to increase in the future It was difficult to source any compliance or details on these products

At the retail chain level staff product training is generally voluntary undertaken out of store hours and as an inducement to attend training sessions suppliers usually provide incentives for staff Retail chain purchases are very price driven although some chains are reportedly interested in stocking goods that have credible environmental claims (Mitre 10 and other retail chain sources)

IBIS (2006a) reports that the domestic hardware sector which is dominated by Danks (Home Timber and Hardware Thrifty - Link Hardware and Plants Plus Garden Centre) and Bunnings is classified as a growth market and the sales of lawnmowers and other lawn and garden machinery and equipment represent about 14 of sales revenue

In summary it appears that a range of product attributes influences consumer purchases of lawnmowers and outdoor equipment Currently there is very little information about emissions in any of the information sources a consumer is likely to consult when purchasing these products Nevertheless surveys indicate that consumers are concerned about the environment and are open to including environmental considerations into their purchase decision Educating sales staff about the air emissions from lawnmowers and outdoor equipment together with ecolabels could therefore be important methods for influencing consumers towards the purchase of cleaner products

Equipment Usage

The USA Outdoor Power Equipment Institute CARB (cited in USEPA 1998) and the USEPA (USEPA 1998) have made estimates of annual usage rates and average life spans of outdoor equipment for the general consumer user and for the commercial user Table 13 gives USA usage and lifespan range for selected items of powered equipment

26

Table 13 USA Average Usage and Lifespan of Outdoor Garden Equipment For General Consumers and Commercial Users Equipment Annual usage (Hours) Lifespan (years)

General Consumer

Walk- behind mowers 20-25 6 -7

Rear engine ride on mowers 4 6 -7

Chainsaws 7 5-9

Leaf blowers 9-12 5-9

Trimmers 10 5-9

Commercial User

Walk- behind mowers 320 27

Rear engine ride on mowers 380 38

Chainsaws 405 1-13

Leaf blowers 170-293 18-28

Trimmers 170 - 275 15-28

Discussions with members of the Australian industry confirm that Australian hours of use are likely to be similar to the American estimates although this can vary depending on location For example in tropical areas lawns are mowed more often because they grow faster in this climate The American turnover of equipment is however probably higher than here as the Australian consumer tends to keep their equipment longer and so the useful life of a mower is more likely to be on average 10 ndash12 years

52 Garden and Ground Maintenance Services

According to a recent IBIS report (2006b) the revenue for this industry in 2005-06 was $383 million and the industry outlook is lsquobrightrsquo with a predicted annual average 5 growth over the next few years The Australian customer base for garden maintenance services including for lawn mowing is

Households 55 Business 25 Government 20

The sector is reportedly a growth industry due to

bull the aging population

bull the increasing numbers of households that are time poor income rich and

bull the growing trend for professional landscaping which requires a higher level of garden maintenance

27

The main customer base for these businesses includes middle to upper socioeconomic groups the aged and people who are physically disabled Growth is predicted particularly for the franchise industry with demand from the commercialindustrialgovernment sectors (IBIS 2003) A 1999 ABS survey reported that nearly one-third of older people purchased at least one domestic service per fortnight with gardening assistance being the most common This accords with an industry estimate that about 25 of householders pay someone to mow their lawn (Jim Penman Jimrsquos Mowing personal communication) The industry is sensitive to economic conditions and weather for example the drought has slowed growth over the last few years

The garden maintenance sector is dominated by small independent operators with two major franchisers Jimrsquos Mowing and VIP VIP nationally has 600 franchises and Jimrsquos Mowing about 400 Jimrsquos Mowing reportedly mows about 15000 lawns and has 53 of the market (IBIS 2006b) As franchised lawn mowing services represents about 14 of the lawn mowing services nationally it can be estimated that approximately 280000 lawns are mowed nationally by commercial operators

Jimrsquos Mowing and VIP provide training and advice to new franchisees on equipment including proper maintenance schedules Training generally occurs before franchisees purchase their equipment Most franchisees equipment would consist of two mowers a brushcutter an air blower and possibly a hedge trimmer or chain saw Operators prefer four stroke mowers and these are used for an average eight hours per week Brushcutters are generally two strokes as are other motors (IBIS 2006b and Jim Penman personal communication)

From the above it is estimated commercial operators operate mowers for up 34 million hours per year (or 8 of the total estimated mowing hours per year) and purchase approximately 66000 lawnmowers annually (25 of purchases) The sectorrsquos purchases of brushcutters is estimated to be approximately 8000 units per year or 37 of purchases Table 13 provides US commercial userrsquos annual average hours of use and average equipment life spans ndash it would be anticipated Australian rates would be similar

The main businesses contracting to provide ground maintenance services to the corporate and government sector (including universities) are Spotlessrsquos Open Space Management Transfield and Programmed Maintenance Services all of which are diversified publicly listed companies plus the Danish owned company ISS (previously Tempo Services) (IBIS 2003 and 2006b and company websites) The type of services they provide means it is likely they would have an array of equipment and a preference for the more powerful ride-on mowers and for Class V handheld equipment

53 Government Purchasing

The way purchasing decisions are made by government or other large organizations is generally very different to the approach taken by the general household consumer

bull many of the purchases are for large quantities of goods

28

bull there are well established policies and procedures in place to guide purchasing with the purchase criteria established early in the buying process and

bull those making the purchase are likely to be more knowledgeable about the product than the average consumer and they are usually not the eventual user of the goods

Value for money fitness for purpose ability to supply and over recent years environmental aspects are likely to be important factors in the purchasing decision for Government

Local State and Commonwealth Governments have responsibility for the upkeep of public assets many of which include public open space and other outdoors areas At the State and Federal level these include schools universities sporting facilities hospitals and defence facilities These services may be outsourced individual departments may undertake maintenance and purchase their own equipment or they may purchase equipment through a central purchasing facility With the central purchasing facility these items are generally purchased under contract While there is an increase in the inclusion of environmental considerations in the selection criteria for purchasing goods and services especially under contract these considerations mainly relate to waste management and recycling criteria and not air emissions

Local councils in some states for example NSW generally take responsibility for ground maintenance within their council areas or for some smaller councils the service may be contracted to a neighbouring council In other states such as Victoria there is a trend to outsource ground maintenance contracts to commercial providers

It is unknown what proportion of total sales that direct Government purchases represent however it likely to represent a relatively small share of several percent of the overall market

In summary

bull The general household consumer represents the major market segment for garden equipment accounting for up to 90 of product sales

bull Government is likely to be relatively small direct purchaser of garden equipment

bull Commercial garden services to households purchase approximately 25 of lawnmowers per year and 37 of brushcutters

bull Large ground maintenance companies are likely to prefer larger and more powerful equipment such as ride-on mowers

29

6 Result of Stakeholder Consultation

61 Regulations

The Small Engine Expert Panel ndash Outdoor Equipment considered in depth an approach to take to improve the emissions performance of outdoor garden equipment sold in Australia Discussions were particularly focused on the growing influence of cheap high emissions imported products together with the difficulties that the local manufacturer of lawn mowers is likely to face in complying with the relevant overseas standards As part of this process the industry representatives on the Panel held additional discussions and they consulted international industry experts at the manufacturing level in Europe the USA and Japan

OPEArsquos preference is for the adoption of regulations based on the USEPA standards with Phase 1 being adopted possibly from as early as 2007-08 The industry then proposes that Phase 2 be introduced in 2012 Phase 1 USA EPA standards were adopted in the USA in 1995 to be applied to equipment manufactured from 1997 and Phase 2 standards were introduced in 2002 through to 2007 and these included averaging banking and trading provisions A comparison between the USA Phase 1 and Phase2 standards is given in Table 14 The USEPA is discussing Phase 3 limits for the adoption in 20102011 which includes tighter exhaust emission limits for non-handheld equipment

The emissions limit of the two stroke lawn mower manufactured by the sole Australian manufacturer are well above USA Phase 1 limit for non-handheld equipment One avenue to address this issue which was supported by the Expert Panel ndash Outdoor Equipment would be to place lawn mowers in the US EPA Category 5 (engines gt50cc) This would result in emissions for two stroke lawnmowers being limited to 161 gkW-hour HC + NOx compared to the USA regulated limit of 161 gkW-hour HC + NOx Doing this would align the ramp-up timetable for mowers with that of other garden products

Table 14 Comparison between the USA Phase 1 and Phase 2 standards

Emission Limits GkW-hr

Phase 1 (1997 ndash2001) Phase 2 (2007) HC NOx HC+NOx CO HC+NOx CO

Non-handheld I-A lt66cc 161 610 I-B 66-lt100cc 161 610 I 100-225 cm3 161 519 161 610 II 225 cm3 134 519 121 610 Handheld III lt20 cm3 295 536 805 50 805 IV 20-50 cm3 241 536 805 50 805 V 50 cm3 161 536 603 72 603

Phase 2 limits were phased in between 2002 -2007 during which time they became tighter for simplicity only the 2007 are shown in this table (see Table 2 for more details)

30

In addition to limiting emissions the Expert Panel support the inclusion of the durability criteria which apply in the USA under Phase 2 standards and certification documentation from either the USA or Europe as adequate proof of conformity Equipment that has not been tested and certified to USA or European standards will be required to have the engines tested in a NATA certified laboratory

Some in the industry argued that regulations should include provisions for averaging for companies that wish to use it however they felt banking and trading provisions would not be necessary Industry representatives were not supportive of any Australian consumer labeling requirement instead OPEA members are willing to supply emissions data for inclusion in a web-based database that would allow purchasers to assess the environmental credentials of different makes and models

62 Discussion on recommended regulations

Timing of introduction

Some industry representatives argue that introduction of Phase 1 standards in 2007-08 will not give the industry an adequate transition period in which to develop competence in emissions certification establish new procedures and tooling in the dealers workshops train dealers and technicians on legal requirements distribute specific tooling and spare parts and reduce stocks of old (non certified) products without incurring an undue financial burden While others in the industry prefer progressing straight to phase 2 standards

If the OPEA preference for the adoption of the United States Phase 1 regulations which operated in the USA between 1995 and 2001 were introduced in Australia in 2007-08 they would be well behind the USA standards and worldrsquos best practice Furthermore the introduction of the United States Phase 2 - 2007 limits in Australia in 2012 would if the USEPA introduce Phase 3 in 2010-11 see emission limits for lawnmowers and other non handheld garden equipment in Australia still lagging United States standards and worldrsquos best practice

To introduce regulations in 2007-08 will require Government firstly to determine the most appropriate mechanism under which to enact the regulations draft the regulations prepare the regulatory impact assessment consult with the broader community and then finalise the regulations It is likely an Act of Parliament will be required at the Commonwealth level followed by complementary legislation at the State and Territory level It is possible for this to be achieved in less than a two year timeframe (as was the case for the Water Efficiency Labelling Scheme) However regulations that do not have a level of perceived urgency would take longer The level of importance and urgency to control emissions from small engines has yet to be debated and determined

31

Modified USEPA limits for lawnmowers

From the 183 lawn mowers identified through the market survey Victa is the main (possibly sole) provider of two stroke mowers with the other lawnmowers having cleaner four stroke engines

Victa is undertaking work to produce a cleaner product Victa estimates it would need a number of years to complete development production tooling and commercialisation of the cleaner engines In January 2007 it released a new two stroke carburettor lawnmower that has reduced engine emissions by more 30 but the combined HC and NOx emissions are still above USEPA Phase 1 limits Victa says this new engine is the outcome of four years of collaborative work by Victa and the University of Technology Sydney Victa is continuing with this research to further reduce emissions

A clause that allows exemptions to be granted as occurs in other countries could be included in the regulations however Victa argues that this would create uncertain trading conditions for the company for a period of time until an exemption were granted

Placing lawn mowers in the US EPA Category 5 (engines gt50cc) has the risk of opening the Australian market to more two stroke lawn mowers which has the greatest use of any outdoor powered equipment however it should see the continuance of the sole engine being manufactured in Australia In 1995 when it was introducing small engine emission limits the USEPA faced a similar issue with two stroke lawn mowers and used a similar approach by allowing two stroke lawn mowers to comply with the handheld standards It also specified that the number of two stroke lawnmower engines allowed to meet handheld standards would be subject to a declining annual production cap with the allowance provided by the production cap being phased out in 2003 There is also similar precedent for small engine emission limits that depend on engine type - European regulations for marine outboard motors set less stringent requirements for two stroke motors

Averaging Banking and Trading Provisions

The US EPA did not have averaging banking and trading provisions in Phase 1 and therefore all small outdoor engines were required to meet the Phase 1 limits It only introduced ABT provisions in the much more stringent Phase 2 as they would allow the most economic introduction of cleaner engines The industry claims the systems to use this provision are available and can be implemented in Australia by those who wish to use it at little cost to government

Industry claim that any supportive economic data related to averaging is sensitive and confidential It is there difficult without substantial justification by the industry to support the provision for averaging in conjunction with Phase 1 particularly given the elapsed time between the introduction of Phase 1 in the USA and their recommended introduction in Australia If there are some low volume equipment items that still cannot meet the USAEPA Phase 1 standards then these could be subjected to

32

exemptions if adequate justification can be provided (exemptions for small volumes were available under the USEPA regulations)

It was noted that for government to implement regulations a regulatory impact statement is required and this requires an assessment of the costs and benefits of the options considered with clear overall benefits shown for the preferred option Therefore if the option for manufacturers to use averaging were to be considered more information to support its inclusion would be required

Other options that could be considered to circumvent the inclusion of averaging include

i including clauses that give manufacturers the ability to apply for exemptions from the regulations for classes of equipment that have small sales volumes (these provisions are available in the USA)

ii limiting the regulation to popular types of equipment

iii using the end-of-model life provisions that have been used in the Australian Design Rules for cars In effect the end of model life provisions require new designs to comply from the implementation date but allow older models to remain on sale for a few more years This is an alternative to ABT because it facilitates earlier introduction of the regulation

iv Having a phase in period of say 2 years during which existing models can continue to be sold but new models coming on to the market must comply with the new standards At the end of the phase-in period all models must comply with the new standards This is an approach that is used when Australian Design Rules (ADRs) are introduced for motor vehicles

Consumer Information

Current Australian directions to reduce the environmental impact of consumer products favor tiered benchmarks using a lsquostarrsquo rating system (see Appendix 3 for examples such as the Mandatory Energy Efficiency Label and the Water Efficiency Labelling Scheme)

As products generally arrive in Australia assembled and packaged industry considers a mandatory requirement to label products with an Australian style star rating would impose a cost on distributors that would drive up the retail price of products Instead the OPEA members were willing to supply emissions data for inclusion in a web-based database that would allow purchasers to assess the environmental credentials of different makes and models Given the diverse nature of the industry it is unlikely a database would provide complete coverage of all products on the Australian market but inclusion in the database would indicate that the manufacturer has a commitment to environmental performance It was acknowledged in discussions that at least some Phase 2 compliant products would become available prior to 2012 and the web-based database would provide one method to promote those cleaner engines

33

In summary the Recommendations of the Expert Panel

1 Mandatory air pollutant emission standards to be introduced in Australia for all outdoor equipment (lt19kW) powered by spark-ignition engines The development of any regulation would need to be based on a formal assessment of the costs and benefits of nationally regulating 2 and 4 stroke lawn mowers and handheld power equipment which should be commenced immediately

2 Proposed standards to mirror US EPA regulations (compliance with equivalent EU regulations also acceptable)

3 Timing (subject to completion of assessment of costs and benefits)

(a) US EPA Phase 1 ndash Effective from 2007 2008

(b) US EPA Phase 2 ndash Fully implemented in 2012 (in step with 2007 USEPA limits) with phase-in period andor ABT over 2008-2012 to provide for early introduction of cleaner product

4 Walk-behind 2 stroke mowers to be included in US EPA Category 5 (gt50cc) product classifications Implementation timing to be as in Recommendation 3 above

5 All products also to be certified to relevant EPA durability categories

6 Subject to further review ABT (if included) may be phased out after 2012

34

7 The Way Forward

The optimum approach for garden equipment out engine emissions of options needs to be sustainable and cost effective This will need to be determined through a costs and benefits analysis (CBA) CBA assigns monetary values and typically assesses the impacts on the consumer on human health on the environment on industry and on government A detailed costs and benefits analysis is beyond the scope of this report however the following sections draws on available information to provide some indication of the possible costs and benefits that are associated with emissions from garden equipment engines

Air Quality Benefits

Environment Canada estimated the introduction of the regulations would result in a 44 percent reduction in combined HC+NOx emissions from small engines used in garden equipment and reduction in individual air pollutants over a 25 year period as shown in Table 15 The Canadian estimates incorporate the benefits that would accrue from the MOU signed with the industry in 2000 plus the benefits from the regulations introduced in 2003 In 2000 Canada imported around 13 million small spark-ignition engines and machines (ie a similar number to Australia) with 80 supplied by the USA

Table 15 Canadian Small Spark-Ignition Engine Emissions in Year 2025

Substance Base Case Emissions in 2025

Emissions in 2025 with Regulations

Percentage Reduction in 2025 (Regulations vs Base Case)

Criteria Air Contaminants (kilotonnes)

HC 772 410 469

NOx a 84 67 201

CO 1413 1403 07

Greenhouse Gas (kilotonnes)

CO2 2903 2645 89 Base case year 2000 (accommodating voluntary agreement) Source Canada Gazette Part II Vol 137 No 24 2003-11-19

Other Environmental Costs and Benefits

In addition to the human health benefits associated with reduced exposure to ozone there is a range of other public benefits including reduced damage to vegetation and therefore higher crop yields less damage to materials and structures particularly

35

some rubber products and improved visibility due to a reduction in smog haze Plus there are benefits associated with lower emissions of other air pollutants

To date there appears to have been little work undertaken in assigning a monetary value to these benefits as it is considered that they are likely to be small compared to human health impacts

Health Costs and Benefits

The Final Impact Assessment for the Ambient Air Quality National Environment Protection Measure (NEPC 1998) estimated that the health damage costs from exposure to ozone nationally to be in the range of $90 ndash $270 million (in 1998 dollars) This figure did not include mortality costs because of difficulty in assigning a figure to human life nor did it include costs associated with minor symptoms such as sore throat cough headache chest discomfort and eye irritation that can result from ozone exposure On the cost of ozone exposure the Impact Assessment states that lsquothe social well-being associated with potentially 6 and 20 million fewer irritating symptoms annually cannot be reliably quantified but at $1 a symptom it adds up to an appreciable amountrsquo

Since the Air NEPM Impact Assessment ozone levels in Australian urban areas have not fallen significantly but the population and medical costs have increased since then However using the above figures to make a rough estimate the contribution made by engines used in lawnmowers (ie not including other garden equipment) to the health damages cost from ozone exposure would be at a minimum $36 - $108 million not including the cost of mortality or minor symptoms As any action on these engines is likely to only remove high emission engines over a decade or more a CBA would be required to include an assessment of the proportional health benefits that would accrue from only removing the high emitters over time

Costs and Benefits to the Consumer

In 1995 the USEPA estimated that on average the cost to the engine manufacturer to install the necessary emission control technology to meet Phase 1 standards (which didnrsquot have ABT) would be approximately $US2 per engine used in nonhandheld equipment and $US350 per engine used in handheld equipment It also estimated that this would translate to sales-weighted average price increases of about $US7

The introduction of phase 2 regulations USEPA estimated would result in price increases of between $US20 and $US64 for handheld equipment depending on the equipment class (USEPA 2000) where handheld engines ranges in price from $60 to $1000 (USEPA 1995)

In addition to emission reductions the implementation of exhaust emission limits has the advantage of reducing fuel consumption and lowering operating costs to the consumer For example the USEPA estimated that for Phase 1 limits that applied between 1995 and 2001 on an average sales-weighted engine basis would decrease fuel consumption by 26 percent for non handheld equipment and a 13 percent decrease in fuel consumption for handheld equipment (USEPA 1995) Phase 2

36

(current limits) would result in a further decrease in fuel consumption of approximately 30 percent for handheld engines

When the USEPA considered the fuel savings offset and the retail price increase it estimated that the average sales-weighted lifetime increase in cost would be about $US650 per handheld engine while nonhandheld engines will realize a lifetime savings of about $US250 per engine This does not include the lifetime savings in maintenance costs which should further benefit the consumer (USEPA 1995)

Euromot (The European Association of Internal Combustion Manufacturers) claims that compliance with European minimum performance standards that do not have ABT provisions adds around 30 to the cost of some products that have had to be brought into compliance4 compared to products sold under the ABT system in the US

Costs and Benefits to Industry and Government

As there is only one local manufacturer among the 43 distributors of powered outdoor garden equipment sold in Australia and all others are importers the main costs to reduce the emissions contribution made by these engines will be associated with program administration and compliance particularly if regulations are introduced

The Productivity Commission an independent agency which is the Australian Governmentrsquos principal review and advisory body on microeconomic policy and regulation recently examined the cost effectiveness of measures to improve the energy efficiency in household appliances As part of its review lsquoThe Private Cost Effectiveness of Improving Energy Efficiencyrsquo it examined labelling programs (ie regulated tiered benchmarks) and minimum mandatory energy efficiency requirements (ie a regulated simple benchmark) While the household appliance market is considerably larger than the garden equipment market the Commissionrsquos final report contains some information that is useful for determining the approach that could be used to establish an emissions reduction scheme for garden equipment A summary of relevant sections of this report is provided in Appendix 3

The Commission identified both administration and compliance costs associated with labelling programs and minimum mandatory energy efficiency requirements as well the impacts these had on product suppliers

The Department of the Environment and Water Resources provided details to the Commission on the costs involved in administering both the labelling scheme and the minimum performance standards for energy programs The information provided showed that

bull the administration costs of the simple benchmark approach were substantially lower (less than one tenth) than for labelling and 84 per cent of administration costs were passed on to appliance purchasers with the remainder borne by governments

4 Presentation by Dr Holger Lochmann Rob Baker Axel Rauch Stihl 19 April 2006

37

bull the compliance costs for labelling are higher

bull minimum mandatory energy efficiency requirements can have a greater cost for suppliers than labelling since suppliers must adjust their model ranges to meet the MEPS levels by the given date These compliance costs are however influenced by the lsquolead inrsquo time between introduction and the implementation of the regulations

bull The increased cost to appliance purchasers of labelled appliances was about two and half times higher compared to appliances purchased under minimum mandatory energy efficiency requirements this being due to consumers voluntarily purchasing more efficient appliances

Overall the Commission considered that labels should be more actively considered as an alternative to minimum performance standards The Commissionrsquos support was based on the ability of labels to amongst other things

bull directly address ldquoa source of market failure mdash the asymmetry of information between buyers and sellers of energy-using productsrdquo

bull provide information to the consumer that is readily-accessible and easily-understood so they can help the consumer make better-informed choices

bull Have net social benefits and possibly have net benefits for consumers

bull provide a greater incentive for suppliers to sell environmentally better products

bull warn consumers through a disendorsement label that an appliance is very inefficient This approach can discourage but not prevent consumers from buying the poor performing product

71 Options to Reduce Emissions from Garden Equipment Engines

There is a range of options that could be considered for reducing emissions from engines used in outdoor garden equipment in Australia These include

1 Do nothing

2 Partnership Programs

3 Quasi regulation

4 Co-regulation

5 Regulations

In the following discussion about these options many Australian examples are mentioned Further details about these programs plus an overview are provided in Appendix 2

38

72 Option 1 ndash Do Nothing

Based on data supplied by OPEA the sales of high emitting two stroke carburettor engines as a percentage of engines used in outdoor equipment increased during the period 2002 to 2005-6 (see Table 12) from 463 to 593 and overall sales number increased by 38 during that period There is no indication that in the short to medium term that sales of equipment with two stroke carburetor engines will decrease in overall sales numbers or as a percentage of sales Therefore under the lsquodo nothingrsquo option emissions from outdoor garden equipment will continue at the same rate or perhaps based on sales figures of two stroke carburetor powered equipment at an even higher rate in the future

73 Option 2 ndash Industry - Government Partnership

In the discussion papers prepared for the NSW small engine project (2004) some examples of successful voluntary Government-Industry Partnership programs were provided The examples included were

bull the National Industry Reduction Agreement where the major newspaper and magazine publishers in Australia agreed to promote recovery and recycling of old newspapers and magazines

bull the NSW EPA-Oil Industry MOU on Summer Fuel the National Packaging Covenant (which has legislative backup) and

bull the EPA Victoriarsquos agreement with the Altona Chemical Complex

From the Australian programs reviewed it appears that the best indicators for successful partnership programs are

bull a relatively small number of firms within the industry

bull a commitment and involvement by all of the industry

bull clear program aims and objectives plus program targets and

bull a willingness by the industry to enter into a cooperative partnership with government

There are 43 identified distributors selling 97 brands of outdoor powered equipment in Australia Many of the major distributors are members of OPEA but there are many distributors who are not members It is therefore unlikely that the even the majority let alone all of the Australian distributors would commit to a industry-government partnership to reduce emissions

74 Option 3 - Quasi Regulation

Quasi regulations can take a range of forms the most usual being the establishment of a code of practice that industry endorses and implements A fundamental part of the code of practice would be emissions standards There are few examples of the use of codes of practice to limit emissions

39

Governmentrsquos role under this scenario is likely to be in assisting in the development of standards

The likelihood of this option being successful for similar reasons to the industry government partnership option is low

75 Option 4 -Co Regulation

Co-regulation is an agreement by industry and government to certain undertakings that support the uptake of cleaner products with a regulatory base It allows industry program flexibility to achieve certain negotiated targets Australian examples of coshyregulation include

bull The Green Vehicle Guide which operates through an industry government agreement where industry report test results to government in an agreed format within a certain timeframe Government manages the data and promotes the program This program is underpinned by Australian Design Rules for motor vehicles

bull The electrical appliance stand-by power program where there are agreed targets established that industry is required lsquovoluntarilyrsquo to meet failure to achieve the targets will result in regulation

bull The Packaging Covenant which is a program that allows industry the flexibility to design it own programs to reduce packaging waste and achieve certain target The Covenant is complemented by the NEPM on used packaging which specifies certain government responsibilities to support the program plus measures that will be introduced if targets are not met

Given the large number of distributors on the Australia market co-regulation for engines used in garden equipment using a similar form to the standndashby power program or the packaging program - an agreement by industry and government on a percentage reduction target for the sale of high emitting engines within a specified timeframe together with an agreement that regulation will be adopted if the target is not met ndash is also unlikely to be successful

76 Option 5 - Regulation

Regulation which requires a clear acknowledgement of a sufficient problem by Government places uniform mandatory compliance obligations on industry The costs associated with regulations are usually shared between government and industry with the development of regulations and program administration costs being borne by government with industry meeting compliance costs including emissions testing and if applicable labelling costs

It could argued that regulation should be introduced in the States or Territories where there are exceedances of the Air NEPM ozone standards However development of state based regulations for garden equipment engines emissions is unlikely as they would be incompatible with the 1992 Intergovernmental Agreement on the

40

Environment signed by the Commonwealth States and Territories and existing Commonwealth and State Government mutual recognition legislation The Intergovernmental Agreement on the Environment which underpins the development of National Environment Protection Measures obligates all jurisdictions to ensure equivalent protection from air pollution to all Australians

In addition enforcement of any state based legislation would be a key problem Under the Commonwealth Mutual Recognition Act 1992 and the Trans-Tasman Mutual Recognition Act 1997 goods that are imported into or produced in an Australian State or Territory or New Zealand that can be sold lawfully in that jurisdiction can be sold freely in a second jurisdiction even if the goods do not comply with the regulatory standards of the second jurisdiction This means non-regulated small engine products legally sold in one State could be legally sold in any other state regardless of whether emissions limits on small engines applied in that State

National regulation on the other hand would provide national consistency It would also provide the opportunity to adopt worldrsquos best practice standards and incorporate penalties for non-complying parties

Under the Australian Constitution the Commonwealth does not possess specific legislative powers in relation to the environment and heritage There are however a number of legislative powers that can support environment and heritage legislation Furthermore Commonwealth legislative powers can be used cumulatively For example the Commonwealth Parliament can make laws under section 51(20) of the Constitution with respect to ldquoforeign corporations and trading or financial corporations formed within the limits of the Commonwealthrdquo

Legislative mechanisms may also be created through the development of a National Environment Protection Measure (NEPM) that then becomes law within each jurisdiction A NEPM can accommodate flexibility of implementation where jurisdictions that have elevated ozone levels can tailor their NEPM program to their specific air quality needs An example of this flexible approach is the Diesel NEPM which has a suite of programs which can be implemented by jurisdictions

From the review of Australian regulations to reduce the environmental impacts of products and the overseas approaches to control emissions from small engines two regulatory approaches become apparent a simple benchmark or tiered benchmarks These are outlined below

Regulatory Option1 - A Simple Benchmark Approach

The most basic regulatory approach that could be taken would be to have a single emission standard (or as per the USA Europe and California a number of emission standards based on power and application) for combined HC + NOx emissions All equipment with new engines sold in Australia from the date the regulations are introduced This approach would

bull remove the all high emission engines from sale

41

bull be supported by an Australian Standard and

bull provide consumers with confidence that all products meet certain emissions standard

Regulatory Option 2 -Tiered Benchmarks

Current Australian directions to reduce the environmental impact of consumer products favour tiered benchmarks using a lsquostarrsquo rating system (see Appendix 2 for examples)

For engines used in garden equipment a tiered emissions labelling system could be based on the USEPA Phase 1 and Phase 2 standards use a system of lsquostarsrsquo to provide information to consumers about environmental performance but not limit consumer choice A tiered lsquostarrsquo system approach would

bull reward those products with more stars that meet the more stringent overseas standards

bull either operate with minimum emissions performance standards or disendorsement labels

bull be supported by a product label and possibly a web database

bull provide consumers emissions information and the option to purchase a lower emission engine

bull be supported by an Australian Standard and

bull be devised to meet worldrsquos best practice which is an overarching approach supported by Government

Table 16 summarises the main strengths and weaknesses of the above options

42

Table 16 Main Strengths and Weaknesses of Each Option

Strengths Weaknesses

Do Nothing Does not limit consumer choice Emissions contribution likely to grow No cost to government No barrier to new market entrants selling

high emitters Consumers have a wide choice of products Industry unchecked amp product dumping

likely No enforcement recourse on environmental grounds available

Partnerships Some sharing of responsibility government Slow if any reduction in high emitters

ndash industry

Potential for Government assist in Few if any companies likely to join and no advancing reductions in high emitters restrictions on non signatories Reduction targets set Below worldrsquos best practice

Quasi Regulation Similar strengths to partnership option Similar weaknesses to partnership option as

few if any companies likely to adopt code of practice

Co-Regulation Ongoing consultation between industry and Due to industry diversity targets unlikely to government recourse to regulation be met Targets set and can require new market Slow reduction in emissions entrants to achieve targets Can have implementation flexibility Emissions test standard adopted

Regulation Option 1- Simple Benchmark Worldrsquos best practice standards can be ovide incentives to manufacturers to promote low adapted and is mandatory emitters

Recourse to legal action available for non Does not provide consumers with emissions compliance information Significant quantifiable health benefits Cost of enforcement borne by taxpayers Requires compliance by all industry and High cost to government bans high emitters

Regulation Option 2 ndash Tiered Benchmarks Provides consumers with emissions information but does not limit choice Incentives for manufacturers to sell low emitters Potentially significant quantifiable health benefits Can be designed to overcome ABT issue

Significant administration and compliance costs to Government High cost to government and industry and will increase retail price of engines Does not ban high emitters

43

77 Preferred Approach

From the above discussion and from the review of garden equipment on available to the Australian consumer there are many companies selling powered garden equipment on the Australian market and the market is very competitive Furthermore from the Expert Panel discussions and stakeholder consultation it is apparent that it is highly unlikely that all the companies in the garden equipment industry would engage in or commit to a voluntary program to reduce their productsrsquo exhaust emissions It is therefore clear that the only feasible path to reduce emissions from these small engines is through regulation

While regulations of emissions from small engines used in garden equipment in Australia are likely to be based on overseas regulations they need to strike a balance between improved environmental outcome harmonisation with international standards and the characteristics of the local industry With regulation optimum emissions reductions are achievable especially by combining minimum emissions standards with tiered product labelling Whether this approach is justifiable on economic grounds that is the benefits outweigh the costs can only be determined through a detailed impact assessment Based on these findings it is recommended that a formal assessment of the costs and benefits of nationally regulating 2 and 4 stroke lawn mowers and handheld power equipment should now be commenced

44

References Air Resources Board California Environmental Protection Agency Californian Exhaust Emission Standards and Test Procedures for 2005 and Later Small Off-road Engines July 26 2004

Artcraft 2003 A Major Research-Based Review and Scoping of Future Directions for Appliance Efficiency Labels in Australia and NZ prepared for the Australian Greenhouse Office viewed at wwwenergyratinggovaulibraryindexhtml

Australian Bureau of Statistics 1999 Older People Australia A Social Report Report Number 41090 December 1999

Australian Greenhouse Office 2002 Achievements 2002 National Appliance equipment energy efficiency program Commonwealth of Australia

Australian Greenhouse Office 2002 Achievements 2002 National Appliance equipment energy efficiency program Commonwealth of Australia

AustralianNew Zealand StandardtradeASNZS 64002005 Water efficient productsmdashRating and labeling Federal Register of Legislative Instruments F2005L01571

Bei L T and Widdows R1999 Product knowledge and product involvement as moderators of the effects of information on purchase decisions a case study using the perfect information frontier approach Journal of Consumer Affairs 33(1) 165-186

Buy Recycled Busines Alliance Briefing Paper Environmental Claims And Labelling Abstract lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10-2003

California Code of Regulations 1998 Final Regulation Order Article 1 and Article 3 Chapter 9 Division 3 Title 13 Attachment 1 26 March 1998 wwwarbcagovregactsoreregs_finpdf

Canada Gazette Part II Vol 137 No 24 2003-11-19

Canadian Gazette 29 March 2003 Vol 137 No 13 Part 1 pp 935- 955

Cap Gemini Ernst amp Young (2001) Cars Online 2001 Global consumer survey httpa593gakamainet75931951a8b278a28319eawwwcgeycomhightechautomediaC ars_online2pdf

Clothes Washers Australiarsquos Standby Power Strategy 2002 ndash 2012 Standby Product Profile 200308 October 2003 wwwenergyratinggovau

Craig ndash Lees M Joy Sally Browne B 1995 Consumer Behaviour John Wiley amp Sons Queensland 1995

Department of Environment and Conservation NSW 2004 Measures to Encourage the Supply and Uptake of Cleaner Lawnmowers and Outdoor Handheld Equipment

45

Department of Environment and Conservation 2003 Who cares about the environment in 2003 A survey of NSW peoplersquos environmental knowledge attitudes and behaviours DEC Social Research Series

Department of Environment and Conservation Action for Air update 2006

Department of Environment and Conservation The Buy Recycled Guide Online Directory viewed at wwwresourcenswgovauindex-RNSWhtm

EcoRecycle 2004 Paint Take-Back Takes Off in Bayswater Media release 24 March 2004 viewed at wwwecorecyclevicgovau May 2004

Enviromower viewed at wwwenviromowercomau June 2004

Environment Canada 2000 Future Canadian Emission Standards for Vehicles and Engines and Standards for Reformulation of Petroleum Based Fuels Discussion Paper in Advance Notice of Intent by the Federal Minister of the Environment April 2000 wwwecgccaenergfuelsreportsfuture_fuelsfuture_fuels1_ehtm

Environment Canada 2004 Environment Minister Urges Canadians to Reduce Greenhouse Gas Emissions and Mow Down Pollution With Unique Incentive Program Media Release April 23 2004 viewed at wwwecgccamediaroomnewsrelease May 2004

Environment Protection and Heritage Council National Environment Protection (Ambient Air Quality) Measure Report on the Preliminary Work for the Review of the Ozone Standard October 2005

Environment Protection Authority 2006 Victoriarsquos Air Quality ndash 2005 Publication 1044 June 2006 wwwepavicgovau

Environmental Choice NZ 2001 Public Good and Environmental Labelling An Internal Background Paper

European Commission Directive 200344EC amending the recreational craft directive and comments to the directive combined 211005

George Wilkenfeld and Associates Pty Ltd with Artcraft Research and Energy Efficient Strategies Tomorrow Today 2003 Final Report A Mandatory Water Efficiency Labelling Scheme for Australia Prepared for Environment Australia June 2003

George Wilkenfeld and Associates 2003 A National Strategy for Consumer Product Resource Labelling in Australia prepared for the Australian Greenhouse Office December 2003 viewed at wwwenergyratinggovaulibraryindexhtml

Green Vehicle Guide wwwgreenvehicleguidegovau

Harrington L and Holt S 2002 Matching Worldrsquos Best Regulated Efficiency Standards ndash Australiarsquos success in adopting new refrigerator MEPS wwwenergyratinggovaulibrarypubsaceee-2002apdf

46

Harris J and Cole A 2003 The role for government in ecolabelling ndash on the scenes or behind the scenes lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10-2003

Holt S and Harrington L2003 Lessons learnt from Australiarsquos standards and labeling program Paper presented at ECEEE Summer Study - 2-6 June 2003 wwwenergyratinggovaulibraryindexhtml

IBIS 2006a Domestic Hardware Retailing 09-Jun-2006 Industry Code G523b

IBIS 2006b Gardening Services 18-Jan-2006 Industry Code Q9525

IBIS 2003 Gardening Services in Australia 23 December 2003 Industry Code Q9525

Lawrence K Zeise K amp Morgan P 2005 Management Options for Non-Road Engine Emissions in Urban Areas Consultancy report for Department for Environment amp Heritage Canberra

Motor Vehicle Environment Committee (MVEC) in consultation with the Department of Transport and Regional Services 2002 Proposal for an Australian ldquoGreen Vehiclesrdquo Guide viewed at httpwwwdotarsgovaumvegreen_vehicles_guidedoc May 2004

National Appliance and Equipment Energy Efficiency Committee The Energy Label at wwwenergyratinggovau (3504)

National Environment Protection Council 2005 National Environment Protection (Ambient Air Quality) Measure Report on the Preliminary Work for the Review of the Ozone Standard October 2005

National Environment Protection Council 1998 Final Impact Assessment for Ambient Air Quality National Environment Protection Measure June 1998

National Environment Protection Council 1999 Used Packaging Materials Impact Statement for the Draft NEPM Used Packaging Material January 1999 viewed at wwwephcgovau

National Environment Protection Council 2004 National Environment Protection (Air Toxics) Measure April 2004 viewed at wwwephcgovau

New South Wales Government 2002 Protection of the Environment Operations (Clean Air) Regulation 2002

New South Wales Government 1999 NSW Government Procurement Policy Statement White Paper 1999

Nordic Council 2002 Ecolabelling of marine Engines Criteria Document 8 December 1995 ndash 6 December 2005 version 35 December 2002

47

Office of Public Sector Information Statutory Instrument 2004 No 2034 The Non-Road Mobile Machinery (Emission of Gaseous and Particulate Pollutants) (Amendment) Regulations 2004 wwwopsigovuksisi200420042034htm

Outdoor Power Equipment Institute 2001 Profile of the Outdoor Power Equipment Industry wwwopeiorg

Productivity Commission 2004 The Private Cost Effectiveness of Improving Energy Efficiency Final report October 2005 wwwpcgovauinquiryenergy

Publishers National Environment Bureau Media Release lsquoAustralia leads the world in newspaper recyclingrsquo 6 June 2006 wwwpnebcomau

Real J Jones A 2005 The Green Vehicle Guide Clean Air Soceity of Australia and New Zealand Conference 2005 Hobart

Salmon G Voluntary Sustainability Standards and Labels (VSSLs) The Case for Fostering Them OECD Round Table On Sustainable Development

Schkade D A and Kelinmutz D N 1994 Information displays and choice processes differential effects of organization form and sequence Organizational Behavior and Human Decision Processes 57(3) 319-337

Stephens A 2003 Eco Buy (Local Government Buy Recycled Alliance Victoria) Abstract lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10shy2003

Teisl M F Roe B and Hicks RL 2002 Can eco-labels fine tune a market Evidence from dolphin-safe labeling Journal of Environmental Economics and Management 43339-359

Teisl M F Roe B and Levy A S Ecolabelling What does consumer science tell us about which strategies work pp141-150

The ISO 14000 family of standards guides and technical reports

The Parliament of the Commonwealth of Australia 2004 House of Representatives Water Efficiency Labelling and Standards Bill 2004 Explanatory Memorandum wwwcomlawgovauComLawLegislationBills1nsf viewed February 2006

Thogerson J 2000 Promoting green consumer behaviour with eco-labels Workshop on Education Information and Voluntary Measures in Environmental Protection National Academy of Sciences ndashNational Research Council Washington DC November 29-30

United States Environmental Protection Agency Federal Register Vol 60 No 127 3 July 1995 Control of Air Pollution Emission Standards for New Nonroad Spark-ignition Engines At or Below 19 Kilowatts wwwepagovEPA-AIR1995JulyDay-03prshy805txthtml

48

United States Environmental Protection Agency Federal Register Vol 69 No 7 12 January 2004 Rules and Regulations 40 CFR Part 90 Amendments to the Phase 2 Requirements for Spark-Ignition Nonroad Engines at or Below 19 Kilowatts Direct Final Rule and Proposed Rule wwwepagovfedrgstrEPA-AIR2004JanuaryDay-12a458pdf

United States Environmental Protection Agency Office of Pollution Prevention and Toxics Pollution Prevention Division 1998 Ecolabelling Environmental Labelling - A Comprehensive Review of Issues Policies and Practices Worldwide

United States Environmental Protection Agency Office of Transportation and Air Quality March 2000 Regulatory Announcement Final Phase 2 Standards for Spark-Ignition Handheld Engines

United States Environmental Protection Agency 1998 Proposed Phase 2 Emission Standards for Small SI Engines 27 January 1998

United States Environmental Protection Agency 2000 Regulatory announcement Final Phase 2 Standards for Small Spark-Ignition Handheld Engines March 2000 EPA420-F-00shy007

United States Federal Register Vol 69 No 7 Monday January 12 2004 Rules and Regulations Environmental Protection Agency 40 CFR Part 90 Amendments to the Phase 2 Requirements for Spark-Ignition Nonroad Engines at or Below 19 Kilowatts Direct Final Rule and Proposed Rule United States Federal Register Vol 64 No 60 30 March 1999 40 CFR Part 90 Phase 2 Emission Standards for New Nonroad Spark-Ignition Nonhandheld Engines At or Below 19 Kilowatts Final Rule pp15214-15216

United States Federal Register Vol 65 No 80 25 April 2000 40 CFR Parts 90 and 91 Phase 2 Emission Standards for New Nonroad Spark-Ignition Handheld Engines at or Below 19 Kilowatts and Minor Amendments to Emission Requirements Applicable to Small Spark-Ignition Engines and Marine Spark-Ignition Engines Final Rule pp24282-24284

United States Environmental Protection Agency Control of Air Pollution Emission for New Nonroad Spark-ignition Engines At or Below 19 Kilowatts Final Rule 40 CFR Parts 9 and 90 1995 wwwepagovEPA-AIR1995JulyDay-03pr-805txthtml

United States Environmental Protection Agency Office of Pollution Prevention and Toxics Pollution Prevention Division 1998 Ecolabelling Environmental Labeling- A Comprehensive Review of Issues Policies and Practices Worldwide

Victorian Government Greenhouse Strategy Community Action Fund - Mow Down Lawn Mower Rebate Exchange Program wwwgreenhousevicgovaucommunitygrantscafsuccessfulprojectshtm

Water Efficiency Labelling and Standards Act 2005 No 4 wwwcomlawgovauComLawLegislation

49

Water Efficiency Labelling and Standards Determination 2005 wwwcomlawgovauComLawLegislationLegislativeInstrument1nsf

Water Efficiency Labelling and Standards Regulations 2005 wwwcomlawgovauComLawLegislationLegislativeInstrument1nsf

Wilkie W 1994 Consumer Behaviour John Wiley and Sons NY as cited in Craig ndash Lees M Joy Sally Browne B 1995 Consumer Behaviour John Wiley amp Sons Queensland 1995

wwwenergyratinggovau

wwwgreenvehicleguidegovau

wwwwaterratinggovau

50

Appendix 1 Detailed Breakdown of Powered Garden Equipment on the Australian Market

The following table gives a profile of the current equipment on the Australian market It is based mostly on distributor responses to a survey and might not be representative of the total market

Low sales indicates that no sales data was available but volumes are likely to be small compared with popular equipment Phase 1 is US EPA Phase 1 or EU Directive 200288EU Phase 2 is US EPA Phase 2 or Euro standards

Type Ranges Stroke Aerator 5 makes 6 models Sales Low

Engine power 26 to 172kW Engine displ 143-674 ml

2c -4c 5 Unspecified 1 Phase 1 - Phase 2 4

Auger 3 makes 5 models Sales Low

Engine power 12 to 16kW Engine displ 31-ml

2c 5 4c -Unspecified -Phase 1 1 Phase 2 1

Backhoe 0 makes 0 model Sales Low

(2 models in 2003) -

Blower 13 makes 49 models Sales 109K

Engine power 07 to 31kW Engine displ 24-80ml

2c 34 4c 2 Unspecified 13 Phase 1 10 Phase 2 17

Blower-wheeler 3 makes 6 models

Engine power 07 to97kW Engine displ 24-305ml

2c 1 4c 4 Unspecified 1 Phase 1 3 Phase 2 -

Blowervac 6 makes 9 models Sales

Engine power 07 to 11kW Engine displ 24-34ml

2c 6 4c -Unspecified 3 Phase 1- Phase 2 3

Brush cutter 12 makes 95 models Sales 339K

Engine power 06 to 23kW Engine displ 21-54ml

2c 66 4c 5 Unspecified 24 Phase 1 15 Phase 2 34

Chainsaw 9 makes 106 models Sales 152K

Engine power 1 to 58kW Engine displ 26-122ml

2c 74 4c -Unspecified 32 Phase 1 18 Phase 2 27

Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

51

Type Ranges Stroke Clearing saw Engine power 14 to 27kW 2c 6 3 makes Engine displ 36-57ml 4c 0 9 models Unspecified 3 Sales low Phase 1 4 Phase 2 -Cultivator Engine power 07 to 52kW 2c 2 4 makes Engine displ 25-190ml 4c 5 7 models Unspecified -Sales low Phase 1 - Phase 2 5 De-thatcher Engine power 1kW 2c 1 1 makes Engine displ 27ml 4c -1 models Unspecified -Sales low Phase 1 - Phase 2 1 Drill Engine power 1kW 2c 3 3 makes Engine displ 27ml 4c -4 models Unspecified 1 Sales low Phase 1 - Phase 2 1 Edger Engine power 1 to 4kW 2c 12 10 makes Engine displ 24-190ml 4c 11 36 models Unspecified 1 Sales Phase 1 3 Phase 2 22 Garden tractor Engine power 12 to 157kW 2c -2 makes Engine displ 465 to 675ml 4c 5 12 models Unspecified 9 Sales low Phase 1 - Phase 2 3 Grass trimmer Engine power- 2c 3 1 make Engine displ 31ml 4c -3 model Unspecified -Sales Phase 1 - Phase 2 3 Hedge trimmer Engine power 06 to 1kW 2c 28 10 makes Engine displ 21-31ml 4c 1 42 models Unspecified 13 Sales 40K Phase 1 4 Phase 2 35 Lawnmower Engine power 26 to 66kW 2c 22 19 makes Engine displ 100-270ml 4c 151 183 models Price $449-$3609 Unspecified 10 Sales 424K Phase 1 95 Phase 2 48 Line trimmer Engine power 07 to 45kW 2c 25 8 makes Engine displ 24-195ml 4c 2 29 models Price $136-$299 Unspecified 2 Sales Phase 1 2 Phase 2 6 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

52

Type Ranges Stroke Log splitter Engine power 26 to 45kW 2c -1 makes Engine displ 100-195ml 4c 2 2 models Unspecified -Sales low Phase 1 - Phase 2 1 Multicutter Engine power 08 to 14kW 2c 17 5 makes Engine displ 23-36ml 4c 1 19 model Unspecified 1 Sales Phase 1 2 Phase 2 13 Olive nut shaker Engine power - 2c -1 make Engine displ - 4c -1 model Unspecified 1

Phase 1 - Phase 2 -Pole saw Engine power 08 to 14kW 2c 6 4 makes Engine displ 23-36ml 4c -10 models Unspecified 4 Sales low Phase 1 1 Phase 2 3 Power carrier Engine power 37 to 231kW 2c -2 makes Engine displ 160 to 953ml 4c 11 11 models Unspecified -Sales low Phase 1 - Phase 2 10 Power cutter Engine power 32 to 45kW 2c 5 2 makes Engine displ 64-99ml 4c -8 models Unspecified 3 Sales low Phase 1 1 Phase 2 3 Pruner (3 models in 2003) 2c -0 make 4c -0 models Unspecified -Sales low Ride-on-mower Engine power 26 to 231kW 2c -12 makes Engine displ 100 to 725ml 4c 93 124 models Unspecified81 Sales 51K Ph1 1 Ph2106 Rotary hoe (4 models in 2003) 2c -0 makes 4c -0 models Unspecified -Sales low Shredder Engine power 3 to 96kW 2c 1 6 makes Engine displ 126-389ml 4c 16 20 models Unspecified 3 Sales 46K Phase 1 - Phase 2 4 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

53

Type Ranges Stroke Stump grinder Engine power 96kW 2c -1 make Engine displ 389ml 4c 1 1 model Unspecified -Sales low Phase 1 - Phase 2 1 Tiller Engine power 08 to 59kW 2c -3 makes Engine displ 25-243ml 4c 8 9 models Unspecified 1 Sales low Phase 1 - Phase 2 7 Trencher Engine power37kW 2c -1 makes Engine displ 183ml 4c -1 models Unspecified 1 Sales low Phase 1 - Phase 2 1 Trimmer Engine power - 2c 10 2 makes Engine displ - 4c -21 models Price - Unspecified 11 Sales Phase 1 4 Phase 2 -Turfcutter Engine power 37kW 2c -1 makes Engine displ - 4c 1 1 models Unspecified -Sales low Phase 1 - Phase 2 -Vac Engine power 22 to 172kW 2c 1 5 makes Engine displ 158 to 674ml 4c 13 15 models Unspecified 1 Sales Ph11 Ph24 Vac chipper Engine power 34 to 45kW 2c -2 makes Engine displ 158-195ml 4c 3 3 models Unspecified -Sales low Phase 1 - Phase 2 1 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

54

Appendix 2 Examples of Current Australian Benchmarking Programs

The following describes in varying degrees of detail a number of current Australian benchmarking schemes classified by program type simple bench mark approaches tiered benchmarks and government industry partnerships This appendix concludes with a summary table of these programs with an assessment of their effectiveness

1 Introduction

Simple benchmark schemes (described below) such as the woodheater standards set a single point hurdle rate whereas the green vehicle guide use tiered benchmarks The new water efficiency labelling scheme and minimum energy efficiency performance standards uses both a simple benchmark through minimum performance requirement plus tiered benchmarks incorporated into labels as lsquostarsrsquo Other approaches such as the stand-by power program and the Victorian Altona Complex VOC reduction target set goals for achievement within a specified time period Other approaches taken to reduce environmental impacts include the National Packaging Covenant which uses a program based on individual companies developing tailored approaches to suit their circumstances and is supported by enforcement capability through the National Environment Protection (Used Packaging Materials) Measure (the NEPM)

2 Simple Benchmarks

21 Minimum Energy Performance Standards (MEPS)

Purpose

MEPS prescribe a minimum allowed energy performance for specific appliances Appliances that are less efficient than the relevant standard are excluded from the market

Background and Strategy

In October 1999 as part of the National Greenhouse Strategy (1998) nationally consistent MEPS and labelling schemes were adopted across Australia

Independent NATA accredited laboratories undertake product compliance checks to see whether products perform in compliance with MEPS requirements For example

bull In 2003 the government conducted check tests on eight appliance models all of which were found not to meet the claims made on the energy performance labels Two products were deregistered one was found to have not been registered and action was pending on the remaining five products (AGO 2003b)

55

bull Other regulatory actions undertaken in 2003 included fines of $3000 and $8000 against two Western Australian retailers who were found to have sold appliances without energy performance labels Queensland and Victorian retailers received infringement notices and fines totalling $10 000 (AGO 2003b)

Summary RegulNated minimum performance standards based on an Australian Standard

22 Energy Star

Purpose

An endorsement label that indicates an electronic product has achieved a specified standard when it is not performing its core function (ie on stand by)

Background and Strategy

Energy Star is a voluntary endorsement labelling program developed by the US Environmental Protection Agency (US EPA) It has been operating in the USA since 1992 and has been adopted by a number of countries including Australia Energy Star sets voluntary standards for reducing the electricity consumption of electronic equipment when it is not performing its core function

The Government stand ndash by program which is outlined below complements the energy star labelling program

Summary Voluntary endorsement label

23 Woodheater Standards

Purpose

To reduce particle emissions through Australian Standard compliant woodheaters

Background and Strategy

Since 1992 Australian StandardNew Zealand Standards have been introduced to improve the performance of wood heaters

The first standard for wood heater emissions AS4013 (1992) was published in 1992 and was revised and published as a joint AustralianNew Zealand Standard in 1999 ASNZS4013 (1999) Domestic solid fuel burning appliances - Method for determination of flue gas emission This Standard provides a test method to measure particles emitted by residential solid-fuel burning heating appliances

56

The 1992 Standard included an upper limit for acceptable particle emissions of 55 grams of particles per kilogram (oven-dry weight) of fuel burnt This emission factor was reduced to 4 gkg in the 1999 revision of the Standard The Standard applies to solid-fuel burning space-heating appliances (including those fitted with water heating devices) with a heat output of 25KW or less It does not apply to masonry fireplaces cooking stoves central heating appliances or water-heating-only appliances

AS 4013 (1999) is complemented by ASNZS4014 (1999) Domestic solid fuel burning appliances - Test Fuels and ASNZS4012 (1999) Domestic solid fuel burning appliances - Method for determination of power output and efficiency

The woodheater industry was instrumental in initiating the development of standards and it lobbied states and territories to enact legislation to mandating that woodheaters be required to meet the standards As the health affects of particle pollution have become more apparent and as some jurisdictions are having difficulty in meeting national particle standards Government has become more proactive in controlling woodheaters and more supportive of tighter standards

All states and territories with the exception of South Australia have regulations that restrict emissions from new woodheaters although Victoria for example only introduced its regulations in 2004 compared to Tasmania who introduced regulations in 1993 These regulations require that new woodheaters comply with the Australian Standard ASNZS 4013 The State regulations however are not uniform

Many woodheaters that are currently certified for sale do not comply with the revised standard as verified in a National Woodheater Audit Program undertaken in 2004 Seven of the 12 wood heaters tested failed to meet the ASNZS 4013 particle emission limit In addition 55 of heaters were found to have deviations from the original designs and 72 had labelling faults that could adversely affect emissions performance

Testing and certification are administered by the industry association

Summary State and regulations requiring compliance with Australian Standards Certification administered by industry association

24 Standby Power

Purpose

To reduce lsquoexcessiversquo energy consumed in electrical appliance standby mode sold in Australia through in the first instance voluntary targets Appliances covered by the program range from information technology equipment such as PCs and photocopiers entertainment equipment such as TVs DVDs and sound systems major appliances such as water heaters dishwashers and refrigerators and small appliances such as smoke detectors and bread makers

57

Background and Strategy

In 2000 standby power was estimated to constitute 116 per cent of Australiarsquos residential energy use costing households over $500 million and leading to the emission of over 5 million tonnes of carbon dioxide equivalent (AGO 2002c) Holt and Harrington (2004) estimated that standby power consumption in Australia could be reduced by 56 per cent by 2020 (Productivity Commission 2005)

In August 2000 all Australian jurisdictions agreed to pursue efficiencies in standby power consumption of energy-consuming products through support for the International Energy Agencys One -Watt program and endorse its incorporation into theprogram of work

Australia reportedly has taken the lead on implementing the One- Watt program even though many of the products sold in Australia are imported

During 2002 government agencies consulted with stakeholders about ideas to reduce standby The standby strategy which proposed a list of targeted potential product types was presented to the Ministerial Council on Energy

In September 2003 an interim test method for the measurement of standby power ASNZS 62301-2003 (int) based on an internationally recognised standard was published Also during this period work commenced on developing draft product profiles for high priority targeted products

Once product profiles are completed interim voluntary date-specific targets are made The product sales are then monitored to determine progress towards the interim target If it is then determined that inadequate progress is being achieved by a significant number of suppliers then government will regulate

For example the interim 2007 target for clothes washers is as follows

Product Off mode power End of program mode

lt 1W lt 4 W

The National Standby Strategy Target to be achieved by 2012 for clothes washers is as follows

Off mode power End of program mode lt 03 W lt 1 W

In support of the clothes washer program Government will

bull consider creating a Government Purchasing Policy to buy low standby clothes washers where available and fit for purpose

bull collect data on all modes for new clothes washers and analyse trends

bull highlight the range of performances by publishing performance data on clothes washers on a website or by other means

58

bull progressively include standby energy consumption into the Comparative Energy Consumption for labelled products such as clothes washers and clothes dryers

bull work with the Standards Committees to finalise the details of modes and test methods for the relevant standards

bull determine in 2008 if progress is inadequate and if regulation is required

Summary Industry targets possible future regulation

3 Tiered Benchmarks

31 Mandatory Energy Efficiency Label ndash the Energy Star Programs

Purpose

To enable consumers to easily compare the energy performance of electrical appliances used by households and firms through a labelling scheme

Background and Strategy

Several Australian states commenced mandatory energy efficiency labelling for major appliances in the mid-1980s In 1992 it became mandatory across Australia for initially refrigerators and later freezers clothes washers clothes dryers dishwashers and air-conditioners (single phase only) to carry the label when they are offered for sale This labelling program is regarded as one of the most successful in the world (Wilkenfeld and Assoc 2003) It is administered through the Australian Greenhouse Office

The energy rating label for dishwashers

(ldquoa joint government and industry programrdquo) and a website address (wwwenergyratinggovau) and has two main features

bull the star rating which gives a quick comparative assessment of the models energy efficiency and

bull the comparative energy consumption (usually kilowatt hoursyear) which provides an estimate of the annual energy consumption of the appliance based on the tested energy consumption and information about the typical use of the appliance in the home These values are measured under Australian Standards which define test procedures for measuring energy consumption and minimum energy performance criteria Appliances must meet these criteria before they can be granted an Energy Rating Label

The Energy Rating Label includes an endorsement

59

Awards Brand ModelInstallat

ionType

Phase Available

10 Yr Energy

Cost StarRating

Output(kW)

TOSHIBA

Digital Inverter Series Air

Conditioner RAV-SM1102BT-

ERAV-SP1102AT-E (

RAV-SM1102BT-ERAV-

SP1102AT-E)

SingleSplit

SystemDucted

Single $1500 1000

CHUNLAN

KFR-32GWVWa (

NO)

SingleSplit

SystemDucted

Single $645 323

Since its introduction the star rating label seems to have established a high level of recognition with consumers Consumer research (Artcraft 2003) indicates that the different information on the label appeals to different consumer segments interested in purchasing an appliance

When a manufacturer gains approval to use the label they pay for and produce the label in accordance with specifications on size colours fonts layout and design A similar colour scheme and design to the energy consumption label is also used for the compulsory fuel consumption label on new passenger and light commercial vehicles

The labelling scheme is underpinned by regulation whereby regulated Minimum Energy Performance Standards (MEPS) provide the environmental benchmarks that the appliances are required to meet Appliances that do not meet the minimum energy performance standards can be withdrawn from the Australian market

When the energy rating program was reviewed in 2000 technology had advanced to the point where a large percentage of appliances had achieved the maximum number of stars so the rating system was tightened It is estimated that over the 25 year period 1980 to 2005 there will have been an overall reduction in energy consumption of around 70 by the most popular sized refrigerators (with freezers) (Harrington L and Holt S 2002)

In addition to the energy consumption label there is a website (wwwenergyratinggovau) with a comprehensive database of all appliances their star rating and energy consumption In 2002 there were around 220000 hits on the programrsquos various websites and 523000 in 2003 reportedly representing 80000 visits by individual inquirers The website hit rate is estimated to represent almost 10 of consumers who are considering purchasing an appliance (Holt et al 2003)

Cooling

Energy Input (kW)

250

104

Figure B Excerpt from Energy Rating web page for Air Conditioners (cooling cycle only shown)

When the energy rating program was reviewed in 2000 technology had advanced to the point where the Scheme had to be tightened because a large percentage of appliances had achieved the maximum number of stars For example energy use by refrigerators was around 70 compared to that used when the scheme started (Harrington L and Holt S 2002)

60

Regulations

State and Territory legislation refer to the relevant Australian Standards This approach simplifies the State and Territory legislation and makes it relatively straightforward to maintain national consistency of appliance and equipment energy efficiency standards even when standards are continually being revised

The testing procedures and technical requirements for the label and also Minimum Energy Performance Standards (MEPS see below) are incorporated into the applicable Australian Standards Products for sale must be registered with one of the State regulators

Program Administration

The labelling program and MEPS program are administered by the National Appliance and Equipment Energy Efficiency Committee (NAEEEC) which is ultimately directed by the Ministerial Council on Energy

Requirements for Appliance Suppliers

Appliance suppliers are required to

bull Submit applications for product registration and these must include a test report or other data to demonstrate that the appliance meets the relevant Australian Standard

bull While test reports on three separate units are required for most products there is no particular requirement for test laboratories to be accredited or products certified for registration for energy labelling and MEPS in Australia Test reports from the manufacturers laboratory are satisfactory However if there is evidence that results from a particular laboratory are unsatisfactory regulators can mandate test reports from an accredited laboratory

Summary Mandatory labelling scheme backed by regulations and an Australian Standard

32 Water Appliances Water Efficiency Labelling and Standards (WELS) Scheme

Purpose

A labelling scheme backed by legislation to promote domestic water efficient appliances

Background and Strategy

A voluntary water efficiency industry administered labelling scheme has been in existence since 1988 The water efficiency ratings and details on the label design are covered in ASNZS 6400 The main incentive of the voluntary lsquoAAAAArsquo scheme

61

has been the publicity and cash rebates offered by water utilities However the coverage water efficiency performance requirements and impact of this program have been limited

In 2003 the Environment and Heritage Ministers agreed to implement a national Water Efficiency Labelling Scheme (WELS) for products such as shower heads washing machines dishwashers and toilets Consultation with industry and stakeholders was undertaken in 2003 with a strategic study published that identified the products to be included in the new labelling Scheme A Regulation Impact Statement (RIS) which identified the costs and benefits of various options and made various recommendations was published in March 2004 Following public review of the RIS some modifications were made to WELS

The WELS Scheme is backed by the following legislation and standard

Water Efficiency Labelling and Standards Act 2005 which establishes

bull the products subject to the Scheme and the requirements for registration and labelling

bull the standards to apply to WELS products setting requirements for water efficiency performance registration and labelling of these products

bull enforcement provisions including penalties bull the appointment of inspectors to investigate possible contraventions and sets

out their powers and obligations bull review and dispute resolution bull a program Regulator bull the making of regulations bull a requirement for annual reports and for an independent review after five years

Water Efficiency Labelling and Standards Regulations 2005 which

bull prescribes the circumstances in which a person other than the manufacturer of a WELS product may be taken to be the manufacturer of the product (eg an importer)

bull sets out procedures for the issuing and the payment of penalty infringement notices as an alternative to prosecution for offences against the WELS Act

bull specifying the information to be included on an identity card issued to a WELS inspector

Water Efficiency Labelling and Standards Determination 2005 amongst other things determines and establishes product registration fees and calls up the Australian Standard ASNZS6400 2005 Water-efficient products - Rating and labelling which

bull defines the products

bull specifies the assessment procedures (ie identifies test procedures in other Australian Standards)

bull provides the formulas to give products their star rating

bull specifies the labels and their application to products

62

Approximately twenty organisations were represented on the Standards Committee that developed the Standard

State and Territory legislation

The States and Territories have also enacted or agreed to enact complementary legislation to ensure that the WELS Scheme has comprehensive national coverage State and Territory legislation which is almost a mirror of the Commonwealthrsquos Water Efficiency Labelling and Standards Act 2005 enables the States and Territories to for example undertake certain responsibilities delegated to them by the Commonwealth Regulator appoint their own inspectors and enforce the WELS

Other features of WELS include

bull A product web database

bull With the exception of toilets no other products are required to meet mandatory water efficiency requirements (WES) but this may change over time The introduction of mandatory WES means that products not meeting the minimum performance requirements can not legally be sold

bull Products must be tested in accordance with the relevant Standard and must meet any minimum performance and water efficiency requirements in the Standard before they can be granted a WELS Water Rating label

bull It is up to manufacturers or their agents (eg importers in the case of imported products) to ensure that their products are correctly registered and labelled and comply with any other requirements of the Standard

There is a transition phase which gives manufacturers and importers time to test register and label products and to sell pre-existing stock From 1 January 2008 all products are required to display the WELS Water Rating labels irrespective of their date of supply

63

The WELS Water Rating label

Label Features

bull A star rating for a quick comparative assessment of the models water efficiency

bull Labels with 1 to 6 stars

bull Some products may also be labelled with a Zero Star Rated label which indicates that the product is either not water efficient or does not meet basic performance requirements

bull A productrsquos water consumption figure

bull There are provisions for swing tags if there is inadequate surface area for label or the item is likely to be marked by sticking the label on the product

Summary Mandated product labelling using lsquostarrsquo rating system Has a disendorsement label and has provisions to ban products

33 Gas Appliance Rating Scheme

Purpose

A gas labelling program to improve the energy efficiency of gas powered products

Background and Strategy

The Gas and Fuel Corporation of Victoria introduced energy labelling for gas water heaters in 1981 This scheme was taken over by the AGA in 1985 who in 1988 introduced a six star energy performance label This label was intended to be visually consistent with the star rating labels already familiar to consumers of electrical appliances

The labelling scheme is currently voluntary and still administered by the industry body

A range of gas appliances have been subject to minimum energy performance standards (MEPS) since the 1960s The current MEPS levels were set in 1983 and

64

Brand Model Type MjyearStar

RatingSRI

StorageCapacity

(ltrs)IndoorOutdoor

NaturalGas

Instantaneous 18969 59 I N

Instantaneous 18969 59 I N

lsquothe majority of models currently on the market appear to exceed current requirements by a comfortable marginrsquo (SEAV 2003 p 23)

The gas energy labels are similar in format to those found on electrical appliances except they are blue and show annual energy use in MJ

A trial web site listing gas water heaters available in Australia is also available (see below)

Bottle Gas

Rinnai Infinity

V Series

REU-V2632FFU-A (Infinity 26 plus internal) P

Rinnai Infinity

V Series

REU-V2632FFUC-A (HD2001 internal) P

A joint review of the scheme is under way by the Gas Industry and Governments and regulation is under consideration A three year work plan has been published under the Australian and New Zealand Appliance and Equipment Energy Efficiency Program

Summary Currently voluntary labelling using lsquostarrsquo rating system with mandatory minimum energy performance standards Future regulation is under consideration

34 Green Vehicle Guide

Purpose

To provide web-based comparable and accessible environmental data on new motor vehicles

Background and strategy

65

The Commonwealth government started publishing a booklet of fuel consumption data for new passenger and light commercial vehicles in the early 1980s and a low cost web database in more recent years

In 2004 the Government through the Department of Transport and Regional Services (DOTARS) expanded the fuel consumption guide into the Green Vehicle Guide The Green Vehicle Guide is a web based database that rates new passenger and light commercial vehicles on air pollution greenhouse emissions and fuel consumption and gives an overall lsquostarrsquo rating for each vehicle within each vehicle category (small medium luxury sports etc)

The data on which the scores are derived are provided voluntarily by the vehicle manufacturers however this data is based on mandatory Australian Design Rule certification test data

The Guide uses a 5 star rating system however it also assigns half stars resulting in a total of 10 levels

The Greenhouse Ratings are based on carbon dioxide emissions and the Air Pollution Ratings take into account the relative environmental impact of oxides of nitrogen hydrocarbons and particles The relative harmfulness of the pollutants (shown in table below) has been quantified based on the allowable concentrations under the Ambient Air Quality National Environment Protection Measure (NEPM)

Green Vehicle Guide Weighting of Regulated Vehicle Emissions

Vehicle Emission

(equivalent pollutant under Air NEPM)

Calculated

Relative

Harmfulness

Final

Weighting

Carbon Monoxide (CO) 0088 Not included

Oxides of Nitrogen (NOx) (based on

Nitrogen Dioxide)

4 1

Hydrocarbons (HC) (based on

photochemical oxidants as ozone)

5 1

Particulate Matter (PM) (based on PM10) 20 5

Source Real and Jones 2005

NOx and HC were given equal final weightings despite the slight difference in the calculated relative harmfulness primarily because under ADR7900 a combined HC+NOx limit is prescribed rather than individual limits for each pollutant

The higher weighting for particulate matter recognises its significant health impacts The Air Pollution rating scale was devised in such a way that a lsquotypicalrsquo car (that is most petrol engined passenger cars meeting the current emission standard at the time) receives a mid-point rating (5 out of 10)

66

The overall rating or stars is derived from the sum of the air pollution and greenhouse scores ie they are equally weighted

Development of the Green Vehicle Guide (see extract below) involved extensive consultation with vehicle manufacturers

Website Costs

The new highly automated web database which contains data on approximately 1400 vehicles and has sophisticated search facilities cost approximately $200000 to develop plus around $100000 was spent recently to improve the sitersquos usability This compares to the previous low cost database which together with the printed guide cost less than about $80000 per annum The low cost version lacked the automation was only updated annually and did not have the ability to compared vehicles

The manufacturers provide the data on line using special access codes This data is checked by DOTARS before it is uploaded onto the website It takes close to a full time position within DOTARS to administer the website and respond to website related queries

Market Research and Marketing

Before the new greenvehicleguidegovau website was launched DOTARS commissioned consumer surveys to determine the level of knowledge about the environmental impacts made by vehicles This research showed that around half of those surveyed had the belief that ldquoall new cars have the same level of impact on the environmentrdquo

It became apparent through the surveys that there was a need to provide consumers with meaningful information on the relative performance of different vehicles This was a view shared by the Productivity Commission who said that while markets provide extensive information to consumers regarding fuel consumption of motor vehicles ldquothe Australian Governmentrsquos Fuel Consumption Labelling Scheme and Green Vehicle Guide provide relatively low cost accessible and comparable information to consumers and may be justified as part of the more fundamental objective of encouraging consumers to reduce the adverse environmental impacts of motor vehicle userdquo The Productivity Commission also commented that government

67

sources of information of this type were seen as credible and reliable and held in higher regard than information provided by others

DOTARS has scheduled some follow up consumer research for 200062007

DOTARS has spent about $600000 in marketing the Green Vehicle Guide This has included advertising in weekend guides in newspapers developing facts sheets plus targeted marketing to motor vehicle journalists

Summary Website - voluntary but legislative base

4 Government-Industry Partnership programs

Government-Industry Partnerships are the basis of many environmental initiatives and can take a number of forms Industry and government negotiate the terms of the program which are normally detailed in a formal agreement which sets out the environmental objectives and the responsibilities of each party towards their achievement

The GovernmentIndustry Partnership programs outlined below indicate the varied nature of these initiatives

41 The National Packaging Covenant

The National Packaging Covenant (the Covenant) commenced in 1999 and is a voluntary agreement between all levels of government and companies throughout the packaging chain including raw material suppliers packaging producers and retailers The Covenant commits signatories to the implementation of best practice environmental management in areas such as packaging design production and distribution and research into life cycle issues Signatories to the Covenant produce action plans on the measures they will implement to reduce packaging waste and they report annually on their progress In this sense the Covenant provides flexibility to signatories to develop plans suitable to their own circumstances The Covenantrsquos success (it currently has over 600 signatories) is due to the active promotion of it by Government and key industry players

The Covenant is complemented by a regulation the National Environment Protection (Used Packaging Materials) Measure (the NEPM) which enables states and territories to use enforcement action to require companies that donrsquot sign the agreement to take steps to reduce their packaging waste Preceding the Covenant and the NEPM were a number of voluntary industry agreements but these were limited in scope and largely focused on companies in the beverage industry

42 National Industry Reduction Agreement

The Publishers National Environment Bureau (PNEB) was formed in 1990 as an association of the major publishers of newspapers and magazines in Australia to promote the recovery and recycling of old newspapers and old magazines primarily from community kerbside collections organised by local councils

68

The PNEB and a newsprint manufacturer have voluntarily entered into a series of five-year Industry Waste Reduction Agreements with the Commonwealth and State Governments Under the current (third) plan 2001-2005 newsprint recycling in Australia has grown to 754 nationally in 2005 from the 28 level when the PNEB was formed in 1990

43 StateLocal target based programs

There have been a number of agreements signed by state government departments and an industry group where there is a stated goal to reach a specific environmental target For example in the early 1990s there was a voluntary agreement with the EPA Victoria and companies in the Altona Chemical Complex in the western suburbs of Melbourne (which includes Australian Vinyls BASF Dow Chemicals and Qenos) to reduce hydrocarbon emissions by 50 within a specified timeframe The target was met and further emissions reductions were negotiated The NSW EPA-Oil industry petrol volatility agreement outlined below is another example of a target based program

44 NSW EPA-Oil Industry Memorandum of Understanding on Summer Petrol Volatility

In 1998 NSW established arrangements for the supply of low volatility petrol in summer in the Sydney Greater Metropolitan Region implemented through a Memorandum of Understanding between the then EPA and oil companies The principal reason for controlling petrol volatility in summer is to reduce evaporative emissions of VOCs (from vehicles and production and storage sites) which contribute to ozone formation

The Memorandum of Understanding operated over four summer periods from 1998 to 2002 and involved companies voluntarily reducing petrol volatility (measured in kilopascals (kPa) of vapour pressure) over three summer periods from a base of 76kPa to 70kPa in the first summer 67kPa in the second and 62 kPa in the last two years

Although the Memorandum of Understanding was successful in progressively reducing petrol volatility over the period of its operation it was not supported by all industry members Consequently agreement was reached with industry that summer petrol volatility limits should be regulated to ensure a level playing field for all industry participants and regulated limits will apply from the summer of 200405

69

5 Summary of Australian Benchmark Programs

Program National State

Summary of Approach Impact

Voluntary Programs Altona Chemical Complex (Vic)

Local Small industry group worked towards self determined targets

Very high

Energy Star National Standards based label Limited Gas appliance Rating Scheme

National Industry operated labelling scheme with stars assigned therefore has graded benchmarksminimum performance standards out dated web database being developed

Low

National Industry Reduction Agreement

National Small industry group worked towards negotiated targets

High

NSW EPA-Oil Industry MOU

State Small industry group worked towards negotiated targets but not all involved ndash lead to regulations

Moderate

Top Energy Saver Award

National Achievement based label Limited

Quasi Regulatory Green Vehicle Guide

National Well promoted web database star ratings assigned therefore has graded benchmarks data provided voluntarily but backed by ADR requirements

High

Stand-by power National Required to achieve voluntary targets or regulation will be introduced

Unknown

National Packaging Covent

National Performance based targets backed by legislation High

Regulatory Energy Efficiency Labels

National Labelling scheme with stars assigned therefore has graded benchmarksbased on Australian Standard web database

High

MEPS National Sets base benchmark and works with energy rating

High

WELS Scheme National Labelling scheme with stars assigned therefore has graded benchmarksbased on Australian Standardweb database

High

Wood heaters State Only one benchmark assigned regulations are not uniform

Moderate

authorrsquos assessment based on direct or indirect knowledge of these programs

70

Appendix 3 Productivity Commission Comments on Labelling and Minimum Performance Standards

The Productivity Commission an independent agency which is the Australian Governmentrsquos principal review and advisory body on microeconomic policy and regulation recently examined the cost effectiveness of improving energy efficiency As part of its review lsquoThe Private Cost Effectiveness of Improving Energy Efficiencyrsquo it examined labelling programs minimum mandatory energy efficiency requirements and other means of providing consumer information The final report contains some highly relevant material that is applicable to establishing a benchmarking scheme for small engines

The following is a summary of relevant conclusions from the Inquiry

Government Operated Labelling Schemes

From consumer research provided to the Commission it concluded that ldquothere is some evidence to suggest that consumers are now paying more attention to labels than they have in the pastrdquo

The Commission was positive about labelling programs as labels

bull directly address ldquoa source of market failure mdash the asymmetry of information between buyers and sellers of energy-using productsrdquo

bull provide information to the consumer that is readily-accessible and easily-understood and therefore can assist in helping the consumer make better-informed choices

bull are likely to have produced net benefits for consumers

bull do not directly limit consumer choice

bull could provide a greater incentive for suppliers to sell products that use energy cost effectively

bull probably produced net social benefits

bull are most suited where there is a wide spread in the range of performances of comparable appliances and where information failures are most pronouncedrdquo

bull can be used to warn consumers that an appliance is very inefficient (through a disendorsement label) which could be effective in discouraging but not preventing consumers from buying the poor performing product

The Commission was supportive of Governmentrsquos role of drawing together and packaging information through labelling programs as this ensures that ldquorelevant and trusted information gets to those who would otherwise not get itrdquo In material reviewed by the Commission George Wilkenfeld and Associates and Energy Efficient Strategies (1999) claimed that labelling is unlikely to be effective if purchasers rarely inspect appliances in a showroom where they can compare performance across

71

different models or the purchaser is not the ultimate user and so has little interest in operating costs

Labelling programs involves both administration and compliance costs such as those incurred by suppliers in having their products tested but the Commission considered that labels should be more actively considered as an alternative to minimum performance standards

Minimum Performance Standards

Governments can prevent the sale of inefficient products by using minimum standards for example the Minimum Energy Performance Standards (MEPS) that apply to appliances such as refrigerators and freezers air conditioners and electric water heaters If appliances do not meet the minimum standard they cannot be sold in Australia Some appliances are covered by both MEPS and by labelling (for example refrigerators)

The Commission considered that MEPS and labels can be complementary as MEPS act to penalise the worst energy performers whereas labels rewarding the better performers

Costs comparisons of schemes

The Department of the Environment and Water Resources provided details about the costs involved in administering both the labelling scheme and the minimum performance standards for energy programs It stated that

bull the administration costs of MEPS are substantially lower than for labelling but the compliance costs can be higher

bull MEPS can have a greater cost for suppliers than labelling since suppliers must adjust their model ranges to meet the MEPS levels by the given date These compliance costs are however influenced by the lsquolead inrsquo time between the introduction of the regulatory proposal and the implementation of the MEPS

bull it is estimated that the administration costs for MEPS would be $3 million over the period 2000ndash15 compared to $39 million for labelling (in present value terms) (George Wilkenfeld and Associates and Energy Efficient Strategies 1999) Furthermore it was assumed that 84 per cent of administration costs were borne by appliance purchasers with the remainder borne by governments

It estimated that MEPS would increase the cost of appliances by $266 million over 2000ndash15 compared to $688 million for labelling (the latter cost being due to consumers voluntarily purchasing more efficient appliances)

72

Page 10: Outdoor Garden Equipment - Department of the Environment

The development of any regulation would need to be based on a formal assessment of the costs and benefits of nationally regulating two and four stroke lawn mowers and handheld power equipment which should commence immediately

2 Proposed standards to mirror US EPA regulations (compliance with equivalent EU regulations also acceptable)

3 Timing (subject to completion of assessment of costs and benefits)

(a) US EPA Phase 1 ndash Effective from 20072008

(b) US EPA Phase 2 ndash Fully implemented in 2012 (in step with 2007 USEPA limits) plus a phase-in period andor provisions for averaging banking and trading (ABT) of emissions over 2008-2012 to provide for early introduction of cleaner product

The US EPA Phase 1 and Phase two emissions limits are given in the table below

4 Walk-behind two stroke mowers to be included in US EPA Category 5 (gt50cc) product classifications (to provide Victa time to develop a cleaner engine) Implementation timing is proposed to be the same as Recommendation 3 above

5 All products also to be certified to relevant EPA product durability categories

6 Subject to further review ABT if included may be phased out after 2012

Table E1 Comparison between the USA Phase 1 and Phase 2 standards

Emission Limits GkW-hr

Phase 1 (1997 ndash2001) Phase 2 (2007) HC NOx HC+NOx CO HC+NOx CO

Non-handheld

I-A lt66cc 161 161 610

I-B 66-lt100cc 161 161 610

I 100-225 cm3 161 519 161 610

II 225 cm3 134 519 121 610

Handheld

III lt20 cm3 295 536 805 50 805

IV 20-50 cm3 241 536 805 50 805

V 50 cm3 161 536 603 72 603 Phase 2 limits were phased in between 2002 -2007 during which time they became tighter

For simplicity only the 2007 are shown in this table (see Table 2 for more details)

vi

Conclusion

From this review it is apparent that it is highly unlikely that the companies in the industry would engage in or commit to any voluntary type program It is therefore clear that the most expedient path to reduce emissions from these small engines is through national regulation State based regulations could only provide a piecemeal approach that would lead to product dumping in states where there are no regulations and inconsistent regulations that require industry to treat each state market differently In addition enforcement of any state based regulations would be a key problem due to existing Commonwealth and State Government mutual recognition legislation

While any national regulation of emissions from small engines used in garden equipment in Australia are likely to be based on overseas regulations they need to strike a balance between improved environmental outcome harmonisation with international standards and the characteristics of the local industry With regulations optimum emissions reduction are potentially achievable by combining minimum emissions standards with tiered product labelling Whether this approach is justifiable on economic grounds that is the benefits outweigh the costs can only be determined through a detailed impact assessment Based on these findings it is recommended that a formal assessment of the costs and benefits of nationally regulating two and four stroke lawn mowers and handheld power equipment should be commenced

vii

1 Introduction

This report sets out the results of a project to compare and benchmark emissions from engines used in outdoor garden equipment that were available for sale in Australia during 2006 Possible outcomes from the project range from consumer guidelines for selecting low emission engines to regulatory controls on emissions There are currently no state or national regulations that directly control emissions from these engines

The project was commissioned by the Commonwealth Department of the Environment and Water Resources on behalf of state and territory government departments working on reducing the impacts of small engine emissions This report was prepared in consultation with an Expert Panel that included representatives from the Outdoor Power Equipment Association (OPEA)

11 Emissions from outdoor garden equipment engines

Small engines particularly conventional two stroke engines used in applications such as outdoor garden equipment are high polluters relative to their engine size and usage1 These small engines emit volatile organic compounds (VOCs) and oxides of nitrogen (NOx) which contribute to ozone (photochemical smog) formation in summer They also emit particles carbon monoxide (CO) and a range of air toxics such as benzene The USA California Canada and Europe and regulate emissions of VOCs NOx carbon monoxide and particle emissions from outdoor garden equipment

There are five types of spark-ignition engines that can be used in outdoor garden equipment

bull two stroke with carburettor (2c)

bull two stroke with pre-chamber fuel injection (2i)

bull two stroke with direct fuel injection (2di)

bull four stroke with carburettor (4c)

bull four stroke with fuel injection (4i) (includes direct injection)

Carburettor and pre-chamber fuel injection two stroke engines are inherently more polluting than the other three types This is due to their inability to completely separate the inlet gases from the exhaust gases resulting in up to 30 of the fuel being left unburnt and the need to add oil to the fuel to lubricate the engine (four stroke engines have separate reservoirs for fuel and oil) However twostroke carburettor engines typically weigh less than a four stroke engine of the same power and this tends to make them attractive for handheld equipment They also tend to have fewer components are generally cheaper to purchase and are cheaper to maintain than

1 Outdoor equipment covered in this report are engines less than 19kW

1

four stroke motors Victa Lawncare is currently undertaking research and development to improve the environmental performance of two stroke carburettors and while some emission improvements have been made a two stroke compliant with US or European standards is still considered several years away

Four stroke carburettor engines are generally quieter more fuel efficient and are less polluting than conventional two stroke engines

Direct fuel injection (dfi) either two stroke or four stroke overcomes the unburnt fuel problem and can meet the stringent regulated exhaust emission limits that apply overseas However there is not any evidence that dfi engines are being used in outdoor garden equipment available in Australia It appears that engines used in outdoor garden equipment in Australia are generally restricted to two and four stroke carburettor engines

Small engines are not as advanced in environmental terms as motor vehicle engines As a result even the better-performing small engines emit far greater quantities of pollutants per hour than typical modern car engines For example the US Environmental Protection Agency (USEPA) 2002 limit for a typical 4 kilowatt (kW) lawnmower motor is about 66 grams (g) of regulated pollutants per hour of operation A typical 08kW brushcutter sold new in 2002 emitted about 160grams of pollutants per hour - reducing to 40grams per hour if bought new in 2006 The equivalent limit for cars under Australian Design Rule 79 is about 16g per hour In other words operated over a similar time one hour of operation of a brushcutter that meets USEPA 2002 limits produces the same pollution as ten cars and a 4kW lawnmower the same pollution as four cars These comparisons are subject to differences in test methods but they do provide an indication of the disproportionate amount of pollution emitted by small engines

Engines that do not comply with current USEPA requirements are likely to emit several times the amount of pollution calculated in the above example Therefore the worst performing engines are likely to emit some ten times the emissions of the best performers

Because of the combustion of oil these engines also emit high levels of particles Although small engines only contribute a small amount to total particle emissions the rate of particle release compared to other engines can be very high For example lawnmowers can emit over 10 times more particles (in terms of grams per hour) than a petrol motor vehicle (manufactured between 1994 and 2001)

All the above emission comparisons between outdoor garden equipment engines and motor vehicles are subject to differences in test methods but they indicate the disproportionate amount of pollution emitted by small garden equipment engines It also needs to be recognised that motor vehicles in Australia average more than 15000 kilometres per year (ABS 2003) while the annual average use of outdoor garden equipment is around 25 hours for a lawnmower and less for other types of equipment Commercial operators however are likely to have a much higher usage rates than the general public

2

This paper examines the Australian market for small engines used in lawnmowers and handheld garden equipment their impact on air quality relevant overseas regulations and their applicability to Australia and makes recommendations to reduce air quality impacts from these engines

A wide range of information sources has been referenced for this report including data and information supplied by manufacturers distributors and dealers in small engines

3

2 Air Quality and Outdoor Garden Equipment Engines

Emission inventories make estimates of emissions of substances from a multitude of sources into airsheds The National Pollutant Inventory (NPI) which is run cooperatively by the Australian state and territory governments contains data on 90 substances that are emitted to the Australian environment The substances included in the NPI have been identified as important because of their possible health and environmental effects Industry facilities estimate their own emissions annually and report to states and territories Non-industry (or diffuse) emissions estimates which includes emissions from outdoor garden equipment are made by the states and territories on a periodic basis using information sources such as surveys databases and sales figures

The NPI only reports emissions from domestic lawn mowing and for a few airsheds the contribution made by public open space lawn mowing It does not report on the contribution made by other types of outdoor garden equipment such as brushcutters National and selected state NPI emissions estimates for the common air pollutants and for Air Toxics NEPM pollutants from domestic lawn mowing are summarised in Table 1 It should be noted that national emissions from lawn mowing are underestimates as the NPI records emissions for major airsheds only and therefore is not Australia wide plus the estimates do not include evaporative emissions from fuel tanks and hoses

This NPI data is indicative only as the accuracy and completeness of the data sets varies across airsheds and is reliant on the estimation techniques used For example while the population in the NSW is higher than other airsheds its emissions look disproportionally high when compared to the other airsheds This could be because the estimation technique varies or it is due to some other factor

4

Table 1 National Pollutant Inventory Domestic Lawn Mowing Emission Estimates

Substance Port Phillip

Population 34 mill (1996)

SE Qld

Population 23 mill

NSW GMR

Population 47 mill

Adelaide

Population 10 mill

National

Common Air Pollutants (tonnesyear)

Carbon monoxide 12000 12000 24000 6100 69000

Total Volatile Organic Compounds 3600 3800 7000 2000 21000

Particulate Matter 100 um 86 94 170 9 460

Sulphur dioxide 5 5 9 50 81

Oxides of Nitrogen 63 54 120 24 330

Air Toxics (tonnesyear)

Benzene 230 210 390 130 1200

Formaldehyde 56 38 NA 31 180

Polycyclic aromatic hydrocarbons 07 11 21 04 41

Toluene (methylbenzene) 370 360 660 210 2000

Xylenes (individual or mixed isomers) 270 260 490 150 1500

Analysis of the NPI database at the national level shows that domestic lawn mowing is the

- Fourth largest source of benzene contributing 7 to the total reported airshed load

- Fourth largest source of formaldehyde contributing 3 to the total reported airshed load

- Fifth largest source of xylene contributing 6 to the total reported airshed load

- Fifth largest source of toluene contributing 6 to the total reported airshed load

- Sixth largest source of carbon monoxide contributing 12 to the total reported airshed load

- Ninth largest source of VOCs contributing 3 to the total reported airshed load when biogenics (natural sources such as trees and soil) are excluded

The NSW Department of Environment and Conservation has been upgrading its emissions inventory Based on 2003 emissions data non-road anthropogenic sources

5

contribute 619 of the VOCs to the GMR airshed Preliminary results2 indicate that VOC emissions from domestic and public open space lawn mowing contributes on an annual average 41 of all VOC emissions in the GMR On a typical weekend during warmer weather this percentage rises to 11

Therefore it could be assumed that lawn mowing could contribute approximately 4 on average to VOC emissions from anthropogenic sources in major airsheds in Australia when public open space lawn mowing is included This percentage is likely to rise significantly in the warmer spring and autumn weekends which is when lawns and other vegetation grow faster and when more people garden

21 Air Quality Standards

In June 1998 the National Environment Protection Measure for Ambient Air (Air NEPM) established national uniform standards for ambient air quality for the six most common air pollutants ndash carbon monoxide nitrogen dioxide photochemical oxidants (measured as ozone) sulfur dioxide lead and particles less than 10 microns (PM10) The NEPM was varied in 2003 to include PM25 advisory reporting standards and in April 2004 a National Environment Protection Measure for Air Toxics was adopted

Nationally the common pollutants of most concern (particularly in major urban areas) are fine particles and ground level photochemical smog (measured as ozone) which is formed in the warmer months when volatile organic compounds (VOCs) and oxides of nitrogen (NOx) react in the atmosphere under the influence of sunlight in a series of chemical reactions

Recent health studies (cited in NEPC 2005) have strengthened the evidence that there are short-term ozone effects on mortality and respiratory disease The studies also strengthen the view that there does not appear to be a threshold for ozone below which no effects on health are expected to occur In recent years Australian epidemiological studies have been conducted which confirm the results of overseas studies that there is a relationship between elevated ozone levels and hospitalisations and deaths from certain conditions

There are two national ozone standards a one hour standard of 010ppm and a four hour standard of 008ppm with a goal that allows for one exceedance per year by 2008 Sydney experiences a number of days each year of ozone levels above these standards In 2003 Sydney exceeded the one hour standard on 11 days in 2003 19 days in 2004 and 9 days in 2005 The four hour standard was exceeded on 13 days in 2003 19 days in 2004 and 13 days in 2005 Further reductions in VOC and NOx emissions are needed to reduce ozone concentrations in Sydney to levels that would comply with the Air NEPM

The other jurisdictions meet or are close to meeting the current National Environment Protection (Ambient Air Quality) Measure (Air NEPM) ozone standards (NEPC 2005) However the ozone standards are being reviewed and based on current human health evidence the argument appears to be strengthening for tighter ozone standards

2 Presentation to Expert Panel 27 April 2006 by Nick Agipades Manager Major Air Projects NSW DEC

6

Should a stricter standard or an eight-hour standard consistent with international standardsguidelines be adopted achievability of Air NEPM ozone standards or goals could become an issue for some of the other major urban airsheds (NEPC 2005)

Modeling of ozone for Sydneyrsquos Greater Metropolitan Region (GMR) indicates that the implementation of Euro emission limits for on-road vehicles and hence the increased presence of these less polluting vehicles in the fleet and retirement of old more polluting vehicles from the fleet is not sufficient to meet the current NEPM goals Modeling suggests that very large reductions in precursor emissions would be required to meet the current ozone one hour goal (NEPC 2005)

Even when the effects of bushfires and when hazard reduction burning are taken into consideration airsheds such as Launceston Melbourne and Sydney struggle to meet the national standards for particles (EPA 2006) However outdoor powered equipment predominantly from two stroke engines makes only a minor contribution to ambient fine particle loads

While carbon monoxide emissions from engines used in outdoor garden equipment are regulated overseas air monitoring in Australia indicates that carbon monoxides levels are well below the national air quality standards and there are no pressing issues requiring CO from outdoor powered equipment to be regulated In addition data indicates that lowering emissions of VOCs and NOx from small engines reduces CO emissions

Many of the pollutant sources which contribute to the formation of ozone and to particle levels also contain air toxics such as benzene toluene formaldehyde and xylenes These air toxics have been shown to be responsible for a range of health problems including asthma respiratory illnesses and cancer The National Environment Protection Measure for Air Toxics requires each jurisdiction to monitor and report annually on five air toxics benzene polycyclic aromatic hydrocarbons formaldehyde toluene and xylenes The monitoring data is intended to inform future policy and also the public on ambient levels of these air pollutants Monitoring of air toxics to date shows that levels are low and below the national monitoring investigation levels (EPA Vic 2006 DEC 2006)

7

3 Emission Standards for Small Engines

31 Australia

At present there are no Australian regulations or standards to limit air pollutant emissions from small (two and four stroke) engines Australia does benefit to some extent from overseas regulations as many lawnmowers and other gardening equipment sold in Australia have engines manufactured in the United States or Europe where strict standards apply

32 United States

In the United States emission regulations set by the United States Environmental Protection Agency (USEPA) and the Californian Air Resources Board (CARB) apply to lawn mowers and other powered gardening equipment Although CARB standards currently tend to be stricter than USEPA standards by 2006 emissions limits applying under the two standards will be very similar

United States Environment Protection Agency (US EPA)

In 1995 the USEPA introduced ldquoPhase 1rdquo regulations covering small non-road engines with a power of not more than 19kW (25HP) The regulations applied to equipment manufactured from 1997

These regulations have seven classes of equipment based on portability and engine displacement volume (ldquocapacityrdquo) In March 2000 the USEPA published ldquoPhase 2rdquo regulations which are shown in Table 2 These set limits for combined emissions of hydrocarbons (HC) and oxides of nitrogen (NOx) and separate limits for carbon monoxide (CO) emissions and for two stroke engines only particles

Table 2 US EPA Phase 2 Small Engine Emissions Standards (HC+NOx in gkW-hr) (a) (b)

Small Engine Class

Type 2002 2003 2004 2005 2006 2007+

I-A (lt66cc) Non-handheld (eg lawnmowers)

- 161 161 161 161 161

I-B (66 to lt 100cc) - 161 161 161 161 161

I (100 to lt 225cc) - 161 161 161 161 161

II (225cc or more) 180 166 150 136 121 121

III (lt20cc) Handheld (eg trimmers)

238 175 113 50 50 50

IV (20 to lt50cc) 196 148 99 50 50 50

V (50cc or more) - - 143 119 96 72 (a) As carbon monoxide (CO) levels in Australia are well below the Air NEPM standard the

USEPA emission limits for CO have not been included in this table (b) Includes useful life criteria of 50125300 hours

8

When the USEPA introduced ldquoPhase 2rdquo regulations it included averaging banking and trading provisions (ABT) which were seen ldquoas an important element in making stringent Phase 2 emissions standards achievable with regard to technological feasibility lead time and costrdquo (USA 1999) The USEPA also claimed (USA 2000) that the ABT program secures early emissions benefits through the early introduction of cleaner engines

ABT provisions which apply to handheld and non handheld engines are complex but in broad terms averaging means the exchange of emission credits among engine families within a given engine manufacturerrsquos product line This allows a manufacturer to produce some engines that exceed the standards and offsetting these exceedances with emissions from engines that are below the standard Manufacturers are allowed to exchange credits from handheld to non handheld and vice versa Banking means the retention of emission credits by the engine manufacturer generating the credits for use in a future model year (for averaging or trading) Trading is the exchange of emission credits between engine manufacturers which then can be used for averaging purposes banked for future use or traded to another engine manufacturer

In January 2004 USEPA reported that in 2002 averaging was being used but there was very little use of banking It determined that the initial ABT programs as too complex and included discount rates on credits ABT was simplified in 2004 including the elimination of credit discount and multipliers and limits on credit life To date there has reportedly been limited use of banking however it is anticipated that there will be more widespread use of banking credits if the USEPA proposed Phase 3 comes into effect3 (see below)

Particulate limits (2gkW-hr) also apply to two stroke engines Carbon monoxide and durability limits (or useful life) are also prescribed The durability criteria which were introduced in Phase 2 require that the emission limits must be met through the useful life of the engine The manufacturer determines useful life of each product using standardised product testing procedures and then based on the test results selects the useful life category for each product which can be 125 250 or 500 hours These durability criteria acknowledge the large disparity in usage patterns by equipment type and between commercial and residential users It also takes into account the ability of manufacturers to design and build engines for various design lives and which fit the types of equipment engine is produced for

The March 2000 USEPA report (USEPA 2000) estimated that the expected effects of the Phase 2 regulations would be

bull A 70 reduction in HC+NOx beyond the Phase I standards (which were estimated to have reduced emissions by 32 from the unregulated baseline)

bull A 30 reduction in fuel consumption of small handheld equipment bull Price increases of between $US23 (Class III) and $US56 (Class V) for

handheld equipment

3 Dave Gardner Briggs and Stratton email 22506

9

The US EPA is currently considering lsquoPhase 3rsquo regulations which are catalyst based standards to further reduce exhaust HC and NOx emissions from non handheld engines reduce evaporative HC and NOx emissions for both handheld and non handheld engines plus include extended durability criteria These limits are currently at discussion stage only They align with CARB Tier 3 but a longer lead time is proposed

Table 3 Proposed Phase 3 Exhaust Emissions

HC+NOx gkW-hr

CO gkW-hr

Year Useful life hrs

Class I 100 610 2010 125250500

Class II 80 610 2011 2505001000

Class III-V No changes

HC+NOx std is based on averaging

Californian Air Resources Board (CARB)

Spark ignition engines

CARB regulations first introduced emission limits for small engines manufactured from1995 The more recent schedule of emission limits are shown in Table 4 These limits depend solely on the engine capacity and apply to both handheld and non handheld classes

Table 4 CARB Emission Limits for Small Engines (HC+NOx in gkw-hr)

Engine Capacity 2000-2001 2002-2005 2006+

65cc or less 72 72 72

gt65cc to 225cc 161 161 161

gt225cc 134 121 121

California has particle limits for two strokes useful life criteria and mandatory engine labeling including a consumer advisory hang tag as shown in Figure 1 The USEPA is also considering introducing an air index label

10

Figure 1 Example of a Californian Consumer Advisory Hang Tag The Californian regulations take into account sales weighted emission performance for families of engines An engine family is essentially the same engine being used in different equipment items

In 2003 California adopted a Tier 3 program for exhaust and evaporative emissions and these are based on the use of catalytic convertors The engine classes better align with US EPA categories however the exhaust standards for Class I and Class II are more stringent than the existing US EPA standards

Table 5 CARB Tier 3 for Exhaust Emissions

Model Year Displacement Category

Durability Periods (hours)

HC+NOx gkw-hr

CO gkw-hr

Particulate gkw-hr

2005 and subsequent

lt50 cc 50125300 50 536 20 + 50-80 cc inclusive 50125300 72 536 20 +

2005 gt80 cc - lt225 cc Horizontal-shaft eng

125250500 161 549

gt80 cc - lt225 cc NA 161 467 Vertical-shaft Engine 225 cc 125250500 121 549

2006 gt80 cc - lt225 cc 125250500 161 549 225 cc 125250500 121 549

2007 gt80 cc - lt225 cc 125250500 100 549 225 cc 125250500 121 549

2008 and subsequent

gt80 cc - lt225 cc 125250500 100 549 225 cc 1252505001000 80 549

the 1000 hours is applicable for 2008+ Model Year (MY) + applies to 2 stroke only Source California Exhaust Emission Standards and Test Procedures For 2005 And Later Small Off-Road Engines Adopted July 26 2004 effective on October 20 2004

California also has Blue Sky provisions These are voluntary standards for engines that meet the criteria shown in Table 6 Blue Sky Series engines are not included in

11

the averaging banking and trading program Zero-emission small off-road equipment (eg push mowers) may certify to the Blue Sky Series emission standards

In 2005 CARB aligned its test procedures with the USEPA

Table 6 CARB Blue Sky Provisions

Model Year Displacement Category

HC+NOx gkw-hr

CO gkw-hr

Particulate

2005 and subsequent lt50 cc 25 536 20

50 - 80 cc inclusive 36 536 20

2007 and subsequent gt80 cc - lt225 cc 50 549

2008 and subsequent 225 cc 40 549 Applicable to all two stroke engines

33 Canada

The Canadian small engine market has similarities to the Australia market the majority of small engines are imported from the USA and there is one Canadian manufacturer of small spark ignition engines and one major manufacturer of lawn and garden machines

A Memorandum of Understanding (MOU) which came into effect on 1 January 2000 was signed between Environment Canada and ten manufacturers of handheld equipment and nine manufacturers of engines used in non handheld machines The MOU was intended as an interim measure until regulations could be put in place Under the MOU the manufacturers agreed to voluntarily supply small spark ignition engines designed to meet the applicable USEPA Phase 1 emission standards

In 2003 Canada regulated emission limits for handheld and non-handheld small engines based on USEPA emission limits The regulations apply to model years 2005 and later While there are no separate averaging banking and trading provisions in Canadian regulations Canada allows any USEPA certified engine to be sold in Canada This means that engines that do not meet the standard level but are averaged (or use credits) in the United States can be sold in Canada Manufacturers are required to produce upon request evidence of conformity to the standards and are required to provide written instructions on engine maintenance to the first retailer

12

Table 7 Canadian Small Spark-Ignition Engine Exhaust Emission Standards

Engine class

Engine Type

Engine Displacement (cm3)

Effective date (model year)

Standard HC+NOx (gkWshyhr)

Standard NMHC+NOx (gkW-hr)

Standard CO (gkWshyhr)

I-A Non-handheld lt66 2005 and

later 50a -shy 610a

I-B Non-handheld

lt100 and 66

2005 and later

40a 37a 610a

I Non-handheld

lt225 and 100

2005r 161b 148a 519b 610a

II Non-handheld 225 2005 and

later 121a 113a 610a

III Handheld 20 2005 and later 50a -shy 805a

IV Handheld lt50 and 20 2005 and later

50a -shy 805a

V Handheld 50 2005 2006 2007 and later

119a 96a

72a

-shy-shy

-shy

603a 603a

603a a Standards apply throughout the engine useful life b Standards apply only when the engine is new Source Canada Gazette Part II Vol 137 No 24 2003-11-19

34 Europe

In 1998 the European Union introduced exhaust emission limits for small petrol engines through Directive 9768EC and in 2002 introduced amendments through Directive 200288EC The limits in the Directives align with the US regulations however they do not have averaging and banking provisions

Table 8 European Emissions Standards

Small Engine Class Type (HC+NOx in gkW-hr) 2004 2005 2006 2007 2008

SN1 (lt66cc) Non-handheld (eg lawn mowers)

161 161 161 161 161

SN2 (66 to lt 100cc) 161 161 161 161 161

SN3 (100 to lt 225cc) - - - 161 161

SN4 (225cc or more) - - 121 121 121

SH1 (lt20cc) Handheld (eg trimmers)

- - - 50 50

SH2 (20 to lt50cc) - - - 50 50

SH3 (50cc or more) - - - - 72

13

The European Union is currently considering including useful life criteria and averaging and banking provisions plus it is considering introducing a Directive to further reduce emissions from diesel engines The objective of the proposal is to tighten emissions standards for engines in general non-road applications in light of technological developments and it taking into account the parallel developments for similar legislation in the United States in order to harmonise the environmental standards and to facilitate trade

Charts comparing the USA Californian and European Emission Limits are shown below

14

35 Summary of Regulations for Non Handheld Equipment

KEY TO CHARTS

USEPA CARB EU

0

10

20

30

40

50

60

70

80

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

0 to 49cc

0

10

20

30

40

50

60

70

80

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

50 to 65cc

0

2

4

6

8

10

12

14

16

18

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

100 to 224cc

0

2

4

6

8

10

12

14

16

18

20

2000

2002

2004

2006

2008

Year Model

HC

+N

Ox g

kW

-hr

225cc and over (up to 19kW)

15

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

36 Summary of Regulations for Handheld Equipment

KEY TO CHARTS

USEPA CARB EU

20 to 49cc 0 to 19cc

250 250

200

150

HC

+N

Ox g

kW

-hr

100

200

HC

+N

Ox g

kW

-hr

150

100

50 50

0 0

Year Model Year Model

50 to 65cc 66 to 80cc

160

160

140

140

120

40 40

20 20

0 0

120

HC

+N

Ox g

kW

-hr

HC

+N

Ox g

kW

-hr

100100

8080

60 60

Year Model Year Model

16

Summary of Regulations for Handheld Equipment (continued)

KEY TO CHARTS

USEPA CARB EU

0

20

40

60

80

100

120

140

160

2000

2001

2002

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

81 to 224cc

0

20

40

60

80

100

120

140

160

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

225cc and over (up to 19kW)

17

4 Australian Market for Small Engines

41 Likely compliance with overseas emissions standards

As part of this assessment an environmental profile of equipment currently on the Australian market has been developed initially based on information from manufacturersrsquo brochures and web sites and industry magazines and then confirmed through follow-up with relevant industry contacts

Each item of equipment has been assessed on its compliance with USEPA CARB or European regulations In most cases it was not possible to match models available on the Australian market with CARB lists (CARB publishes exhaust emissions data on all appliances on its web site) This was mainly due to the inconsistency of model designations and uncertainty about ldquoengine familiesrdquo

Engine characteristics and retail price were difficult to obtain Some brochures also made claims of compliance with USEPA European or CARB requirements The detailed breakdown of current equipment on the Australian market is given in Appendix 1

The majority of small engines sold in Australia are imported and many come from countries that impose emission limits The extent of imports into Australia that do not comply with the country of origin standards is not known Industry estimates that 40 of garden products are sold through importers who are not linked to manufacturers of US EPA or European certified equipment and the source of some products sold here is difficult to establish Victa is the only company producing small engines in Australia Its iconic 2-stroke lawnmower currently cannot meet overseas emission limits

Outdoor Power Equipment Association (OPEA) assisted in identifying the Australian distributors of most brands of powered garden equipment In April 2006 a survey form was sent to a total of 43 distributors representing 97 brands of equipment The survey form sought information about the engine for all petrol-fuelled garden equipment with a power not more than 19kW

Figure 2 Extract from survey form

18

Initial response to the survey was poor Despite follow-up action and efforts from the industry association at the beginning of September 2006 26 distributors had responded to the survey information and only 13 distributors provided all data necessary for benchmarking purposes This resulted in emission compliance data for about half of the estimated products on the Australian market Attempts to match Australian models with the database maintained by the Californian Air Resources Board were also of limited success due to inconsistencies in model designations between Australia and the USA and the manner in which model information is coded in the CARB database

Table 9 Summary of distributor responses

Responses status Not OPEA OPEA ALL

Number of responses 9 8 (31) 17 (40)

Response - all data 4 9 13 (30)

Response - extra time sought 3 3 (7)

Response - no petrol products 4 1 5 (12)

Response - some data 5 5 (12)

Grand Total 17 26 43 percentages may not add to 100 due to rounding

Of the 97 brands initially identified

bull 16 brands are apparently no longer sold in Australia

bull No responses were received for 29 brands

bull Partial data were received for 12 brands

bull All data was available for 30 brands

Table 10 Summary of responses by brand

Count of brands

Analysis status Not OPEA OPEA All

Missing some data 12 12

No data received 9 (27) 20 (31) 29 (30)

No longer sold 13 3 16

Response - no models to list 3 7 10

Response received (electronic form) 5 11 16

Response received (paper form) 3 2 5

Response received (spreadsheet) 9 9

All 33 64 97

A 2004 report for the NSW DEC estimated that there were about 1200 eligible garden

19

products in the Australian market The current project has obtained data for a total of 870 products or 72 of the estimated population In addition the sampling method is likely to be biased towards products with good environmental performance In these circumstances the following analysis should be regarded as indicative only

Survey results

The following tables and figures show expected compliance with European CARB or USEPA requirements based on the limited information provided by industry

Table 11 Engine type and compliance with overseas standards Count of products Engine type

Best STD 2c 4c Unknown All 1997 - US EPA I 53 32 85 (10) 200288EU 17 17 (2) 2004 - US EPA II 1 3 4 (lt1) 2004 EURO I 8 8 (1) 2005 - US EPA II 10 29 5 44 (5) 2006 - US EPA II 107 141 2 250 (29) 2006 EURO I 6 6 (1) 2007 - US EPA II 1 1 (lt1) 2007 Euro II 2 2 (lt1) None 118 90 208 (24 Unspecified 24 60 161 245 (28) All 344 358 168 870

Unknown means the type of engine is unknown (but is most likely to be 2c) Unspecified means that the status of emissions compliance was unable to be identified None means the manufacturerdistributor has indicated that the equipment does not comply with any overseas emissions standard

Figure 3 Compliance with overseas standards - all surveyed products Note Unknown in chart includes unspecified and unknown from Table 11

20

Figure 4 Compliance with overseas standards by equipment type ldquoPhase 1 equivrdquo means the engine complies with US EPA phase 1 or 200288EU ldquoPhase 2 equivrdquo means the engine complies with US EPA Phase 2 Euro I or Euro 2 ldquoUnknown means that engine cycle (stroke) was not provided

Of the 41 categories of equipment in the survey 15 had at least 10 current products Results for these categories are set out below

Figure 5 Engine type for popular categories

21

Figure 6 Compliance with overseas standards for popular categories ldquoPhase 1 equiv means the engine complies with US EPA phase 1 or 200288EU Phase 2 equiv means the engine complies with US EPA Phase 2 Euro I or Euro 2 ldquoUnknown means that engine cycle (stroke) was not provided

42 Australian Sales of Outdoor Powered Equipment

The Australian Outdoor Power Equipment Association (OPEA) whose membership represents about 80 of the manufacturersdistributors and dealers in the industry commissions regular independent industry audits of garden equipment sales (OPEA personal communications) Sales data from OPEA is shown in Table 12

22

Table 12 Sales of outdoor garden equipment 2002 and 2005-06 2005-06 2 stroke (1000)

2002 2 stroke (1000)

2005-06 4 stroke (1000)

2002 4 stroke (1000)

2005-06 TOTAL (1000)

2002 TOTAL (1000)

Walk behind mowers 72 170 351 76 424 246

Brushcuttertrimmer 321 12 17 180 339 192

Chainsaws 152 0 0 90 152 90

Chipper shredders 0 60 46 0 46 60

Blowerblower vacuums 98 0 11 50 109 50

Ride on mowers 0 25 51 0 51 25

Generators 11 32 96 0 107 32

Hedge trimmers ampothers 40 192 0 28 40 220

694 491 476 424 1267 915

for total sales 593 463 407 537

for mowers 152 280 848 720

According to OPEA approximately 424000 walk behind lawnmowers and more than 792000 units of outdoor handheld equipment were sold in Australia in 2005-06 In addition there were sales of about 80000 replacement engines and 70000 pumps in 2005-06 most of which were four strokes These figures show that there has been considerable growth in the sales of most products with the exception of chipper shredders and the category lsquohedge trimmers and othersrsquo whose sales declined in 2005shy06 compared with those in 2002 About 17 of walk behind lawnmowers were two stroke and 83 four stroke which is an improvement in the uptake of cleaner engines when compared to 2002 when about 30 were two stroke The situation with handheld equipment is reverse with nearly 79 being two strokes compared to 47 in 2002 However many models of two stroke handheld equipment meet current US emission standards and care should be exercised in using engine type (two stroke or four stroke) as an indicator of emissions performance for this class of equipment

The OPEA 2005-06 sales estimates are shown in Figure 7 OPEA cautions that there is considerable uncertainty about the estimates for brushcutters and blowerblower vacuums as OPEArsquos figures only represent 50 and 60 respectively of sales of these products No estimates of future sales trends were identified during research for this project

23

Australian sales of 2 and 4 stroke outdoor equipment 2005-6

0 50 100 150 200 250 300 350 400

Walk behind mowers

Brushcuttertrimmer

Chainsaws

Chipper shredders

Blowerblower vacuums

Ride on mowers

Generators

Other

Annual sales (x 1000)

4s 2s

Figure 7 OPEA estimates of equipment sales in 2005-06 Note Blowervac is an industry term for equipment that combines blowing and vacuuming functions

Briggs and Stratton (Australia) who import engines from the USA supply the majority of the four stroke engines for handheld equipment sold in Australia and these comply with all the current USA and CARB regulations Imported handheld garden equipment is shipped fully assembled to a branch or distributor and is then sent to a retailer The retailer may or may not provide equipment servicing

OPEA members have expressed concern regarding the increasing sales of imported high polluting two stroke engines that allegedly do not meet any emission standards and come from countries that do not have emission standards One industry representative reported that some of the imported trimmers were being manufactured in China using outdated designs and tooling from two old bankrupt American companies and these are being sold here at about 30 of the price of traditional brands and very low cost generators from China now account for around 70 of total sales It is difficult to confirm this trend without undertaking a detailed examination of Australian import data however the significant increase in the sales of two stroke handheld equipment provides some support for this trend

On the other hand it is claimed by industry that the ride on mower market (predominately with compliant four stroke engines) has been stimulated by the Australian USA free trade agreement

24

5 Australian Users of Small Engines This section examines the market segments for garden equipment and customer purchasing behaviour

51 General Public

Purchasing behaviour

Research into consumer purchasing behaviour has found that consumers assess a product against a range of attributes for example price weight brand reputation servicing and parts availability warrantees and guarantees experience size promotions and discounts Studies have also revealed that up to 82 of Australians had bought products on the basis of social or environmental factors in the previous year (State Chamber of Commerce 2001) Related to this point the energy star rating ecolabel on whitegoods was viewed as a credible environmental claims system which is well regarded by the general consumer (Product Category Manager Mitre 10 personal communications)

As the purchase of small engine garden equipment by the general consumer is an infrequent purchase which carries a certain of amount of risk With small engines the risk can be functional risk (will not perform as expected) physical risk (for example safe features such automatic cut out on an electric lawn mower) or financial risk especially for the more expensive items The general consumer is likely to lessen the risk by seeking information and by evaluating the information on the available products over a period of time The consumer may also lessen the risk by

bull purchasing well known brands

bull buying the brand offering the best warrantees and guarantees

bull buying the most expensive brand and

bull buying a brand they have used before

Research indicates that the desired attributes of a product may not be well established at the start of a consumerrsquos search process but will often be refined as the consumer learns more about the product The consumer will also use a ranking and weighting process based on desired qualities and trade offs may be made

Reportedly purchases of engine operated garden equipment are based on price yard size fitness for purpose and other features such as weight and ease of starting (Product Category Manager Mitre 10 personal communications) Males are the predominant purchasers of garden equipment however because of changing demographics there has been an increase in the number of women purchasing these products

Less than 5 of lawnmowers purchased are push or electric mowers (Product Category Manager Mitre 10 and industry sources personal communications 2003)

25

Electric mowers are generally perceived as not being as effective as cords have limited range and rechargeable electric mowers require frequent recharging

There is a recent trend towards ride on mowers (all four strokes) probably because of changing demographics specifically older age groups moving to more rural environments with larger yards (OPEA personal communications)

A study (Wilkie 1994) investigated consumer appliance purchasing behaviour and found that the general consumer consulted a range of information sources before purchasing an appliance The appliance salesperson was found to be the most important information source for many consumers Other important information sources include newspaper advertisements friends and relatives catalogues consumer reports and brochureslabels Since Wilkiersquos study the internet will have become increasingly important as a research tool and in some instances as a way to purchase products As part of this study there is evidence of low priced products being sold into the Australian market via the internet only ndash a practice that is likely to increase in the future It was difficult to source any compliance or details on these products

At the retail chain level staff product training is generally voluntary undertaken out of store hours and as an inducement to attend training sessions suppliers usually provide incentives for staff Retail chain purchases are very price driven although some chains are reportedly interested in stocking goods that have credible environmental claims (Mitre 10 and other retail chain sources)

IBIS (2006a) reports that the domestic hardware sector which is dominated by Danks (Home Timber and Hardware Thrifty - Link Hardware and Plants Plus Garden Centre) and Bunnings is classified as a growth market and the sales of lawnmowers and other lawn and garden machinery and equipment represent about 14 of sales revenue

In summary it appears that a range of product attributes influences consumer purchases of lawnmowers and outdoor equipment Currently there is very little information about emissions in any of the information sources a consumer is likely to consult when purchasing these products Nevertheless surveys indicate that consumers are concerned about the environment and are open to including environmental considerations into their purchase decision Educating sales staff about the air emissions from lawnmowers and outdoor equipment together with ecolabels could therefore be important methods for influencing consumers towards the purchase of cleaner products

Equipment Usage

The USA Outdoor Power Equipment Institute CARB (cited in USEPA 1998) and the USEPA (USEPA 1998) have made estimates of annual usage rates and average life spans of outdoor equipment for the general consumer user and for the commercial user Table 13 gives USA usage and lifespan range for selected items of powered equipment

26

Table 13 USA Average Usage and Lifespan of Outdoor Garden Equipment For General Consumers and Commercial Users Equipment Annual usage (Hours) Lifespan (years)

General Consumer

Walk- behind mowers 20-25 6 -7

Rear engine ride on mowers 4 6 -7

Chainsaws 7 5-9

Leaf blowers 9-12 5-9

Trimmers 10 5-9

Commercial User

Walk- behind mowers 320 27

Rear engine ride on mowers 380 38

Chainsaws 405 1-13

Leaf blowers 170-293 18-28

Trimmers 170 - 275 15-28

Discussions with members of the Australian industry confirm that Australian hours of use are likely to be similar to the American estimates although this can vary depending on location For example in tropical areas lawns are mowed more often because they grow faster in this climate The American turnover of equipment is however probably higher than here as the Australian consumer tends to keep their equipment longer and so the useful life of a mower is more likely to be on average 10 ndash12 years

52 Garden and Ground Maintenance Services

According to a recent IBIS report (2006b) the revenue for this industry in 2005-06 was $383 million and the industry outlook is lsquobrightrsquo with a predicted annual average 5 growth over the next few years The Australian customer base for garden maintenance services including for lawn mowing is

Households 55 Business 25 Government 20

The sector is reportedly a growth industry due to

bull the aging population

bull the increasing numbers of households that are time poor income rich and

bull the growing trend for professional landscaping which requires a higher level of garden maintenance

27

The main customer base for these businesses includes middle to upper socioeconomic groups the aged and people who are physically disabled Growth is predicted particularly for the franchise industry with demand from the commercialindustrialgovernment sectors (IBIS 2003) A 1999 ABS survey reported that nearly one-third of older people purchased at least one domestic service per fortnight with gardening assistance being the most common This accords with an industry estimate that about 25 of householders pay someone to mow their lawn (Jim Penman Jimrsquos Mowing personal communication) The industry is sensitive to economic conditions and weather for example the drought has slowed growth over the last few years

The garden maintenance sector is dominated by small independent operators with two major franchisers Jimrsquos Mowing and VIP VIP nationally has 600 franchises and Jimrsquos Mowing about 400 Jimrsquos Mowing reportedly mows about 15000 lawns and has 53 of the market (IBIS 2006b) As franchised lawn mowing services represents about 14 of the lawn mowing services nationally it can be estimated that approximately 280000 lawns are mowed nationally by commercial operators

Jimrsquos Mowing and VIP provide training and advice to new franchisees on equipment including proper maintenance schedules Training generally occurs before franchisees purchase their equipment Most franchisees equipment would consist of two mowers a brushcutter an air blower and possibly a hedge trimmer or chain saw Operators prefer four stroke mowers and these are used for an average eight hours per week Brushcutters are generally two strokes as are other motors (IBIS 2006b and Jim Penman personal communication)

From the above it is estimated commercial operators operate mowers for up 34 million hours per year (or 8 of the total estimated mowing hours per year) and purchase approximately 66000 lawnmowers annually (25 of purchases) The sectorrsquos purchases of brushcutters is estimated to be approximately 8000 units per year or 37 of purchases Table 13 provides US commercial userrsquos annual average hours of use and average equipment life spans ndash it would be anticipated Australian rates would be similar

The main businesses contracting to provide ground maintenance services to the corporate and government sector (including universities) are Spotlessrsquos Open Space Management Transfield and Programmed Maintenance Services all of which are diversified publicly listed companies plus the Danish owned company ISS (previously Tempo Services) (IBIS 2003 and 2006b and company websites) The type of services they provide means it is likely they would have an array of equipment and a preference for the more powerful ride-on mowers and for Class V handheld equipment

53 Government Purchasing

The way purchasing decisions are made by government or other large organizations is generally very different to the approach taken by the general household consumer

bull many of the purchases are for large quantities of goods

28

bull there are well established policies and procedures in place to guide purchasing with the purchase criteria established early in the buying process and

bull those making the purchase are likely to be more knowledgeable about the product than the average consumer and they are usually not the eventual user of the goods

Value for money fitness for purpose ability to supply and over recent years environmental aspects are likely to be important factors in the purchasing decision for Government

Local State and Commonwealth Governments have responsibility for the upkeep of public assets many of which include public open space and other outdoors areas At the State and Federal level these include schools universities sporting facilities hospitals and defence facilities These services may be outsourced individual departments may undertake maintenance and purchase their own equipment or they may purchase equipment through a central purchasing facility With the central purchasing facility these items are generally purchased under contract While there is an increase in the inclusion of environmental considerations in the selection criteria for purchasing goods and services especially under contract these considerations mainly relate to waste management and recycling criteria and not air emissions

Local councils in some states for example NSW generally take responsibility for ground maintenance within their council areas or for some smaller councils the service may be contracted to a neighbouring council In other states such as Victoria there is a trend to outsource ground maintenance contracts to commercial providers

It is unknown what proportion of total sales that direct Government purchases represent however it likely to represent a relatively small share of several percent of the overall market

In summary

bull The general household consumer represents the major market segment for garden equipment accounting for up to 90 of product sales

bull Government is likely to be relatively small direct purchaser of garden equipment

bull Commercial garden services to households purchase approximately 25 of lawnmowers per year and 37 of brushcutters

bull Large ground maintenance companies are likely to prefer larger and more powerful equipment such as ride-on mowers

29

6 Result of Stakeholder Consultation

61 Regulations

The Small Engine Expert Panel ndash Outdoor Equipment considered in depth an approach to take to improve the emissions performance of outdoor garden equipment sold in Australia Discussions were particularly focused on the growing influence of cheap high emissions imported products together with the difficulties that the local manufacturer of lawn mowers is likely to face in complying with the relevant overseas standards As part of this process the industry representatives on the Panel held additional discussions and they consulted international industry experts at the manufacturing level in Europe the USA and Japan

OPEArsquos preference is for the adoption of regulations based on the USEPA standards with Phase 1 being adopted possibly from as early as 2007-08 The industry then proposes that Phase 2 be introduced in 2012 Phase 1 USA EPA standards were adopted in the USA in 1995 to be applied to equipment manufactured from 1997 and Phase 2 standards were introduced in 2002 through to 2007 and these included averaging banking and trading provisions A comparison between the USA Phase 1 and Phase2 standards is given in Table 14 The USEPA is discussing Phase 3 limits for the adoption in 20102011 which includes tighter exhaust emission limits for non-handheld equipment

The emissions limit of the two stroke lawn mower manufactured by the sole Australian manufacturer are well above USA Phase 1 limit for non-handheld equipment One avenue to address this issue which was supported by the Expert Panel ndash Outdoor Equipment would be to place lawn mowers in the US EPA Category 5 (engines gt50cc) This would result in emissions for two stroke lawnmowers being limited to 161 gkW-hour HC + NOx compared to the USA regulated limit of 161 gkW-hour HC + NOx Doing this would align the ramp-up timetable for mowers with that of other garden products

Table 14 Comparison between the USA Phase 1 and Phase 2 standards

Emission Limits GkW-hr

Phase 1 (1997 ndash2001) Phase 2 (2007) HC NOx HC+NOx CO HC+NOx CO

Non-handheld I-A lt66cc 161 610 I-B 66-lt100cc 161 610 I 100-225 cm3 161 519 161 610 II 225 cm3 134 519 121 610 Handheld III lt20 cm3 295 536 805 50 805 IV 20-50 cm3 241 536 805 50 805 V 50 cm3 161 536 603 72 603

Phase 2 limits were phased in between 2002 -2007 during which time they became tighter for simplicity only the 2007 are shown in this table (see Table 2 for more details)

30

In addition to limiting emissions the Expert Panel support the inclusion of the durability criteria which apply in the USA under Phase 2 standards and certification documentation from either the USA or Europe as adequate proof of conformity Equipment that has not been tested and certified to USA or European standards will be required to have the engines tested in a NATA certified laboratory

Some in the industry argued that regulations should include provisions for averaging for companies that wish to use it however they felt banking and trading provisions would not be necessary Industry representatives were not supportive of any Australian consumer labeling requirement instead OPEA members are willing to supply emissions data for inclusion in a web-based database that would allow purchasers to assess the environmental credentials of different makes and models

62 Discussion on recommended regulations

Timing of introduction

Some industry representatives argue that introduction of Phase 1 standards in 2007-08 will not give the industry an adequate transition period in which to develop competence in emissions certification establish new procedures and tooling in the dealers workshops train dealers and technicians on legal requirements distribute specific tooling and spare parts and reduce stocks of old (non certified) products without incurring an undue financial burden While others in the industry prefer progressing straight to phase 2 standards

If the OPEA preference for the adoption of the United States Phase 1 regulations which operated in the USA between 1995 and 2001 were introduced in Australia in 2007-08 they would be well behind the USA standards and worldrsquos best practice Furthermore the introduction of the United States Phase 2 - 2007 limits in Australia in 2012 would if the USEPA introduce Phase 3 in 2010-11 see emission limits for lawnmowers and other non handheld garden equipment in Australia still lagging United States standards and worldrsquos best practice

To introduce regulations in 2007-08 will require Government firstly to determine the most appropriate mechanism under which to enact the regulations draft the regulations prepare the regulatory impact assessment consult with the broader community and then finalise the regulations It is likely an Act of Parliament will be required at the Commonwealth level followed by complementary legislation at the State and Territory level It is possible for this to be achieved in less than a two year timeframe (as was the case for the Water Efficiency Labelling Scheme) However regulations that do not have a level of perceived urgency would take longer The level of importance and urgency to control emissions from small engines has yet to be debated and determined

31

Modified USEPA limits for lawnmowers

From the 183 lawn mowers identified through the market survey Victa is the main (possibly sole) provider of two stroke mowers with the other lawnmowers having cleaner four stroke engines

Victa is undertaking work to produce a cleaner product Victa estimates it would need a number of years to complete development production tooling and commercialisation of the cleaner engines In January 2007 it released a new two stroke carburettor lawnmower that has reduced engine emissions by more 30 but the combined HC and NOx emissions are still above USEPA Phase 1 limits Victa says this new engine is the outcome of four years of collaborative work by Victa and the University of Technology Sydney Victa is continuing with this research to further reduce emissions

A clause that allows exemptions to be granted as occurs in other countries could be included in the regulations however Victa argues that this would create uncertain trading conditions for the company for a period of time until an exemption were granted

Placing lawn mowers in the US EPA Category 5 (engines gt50cc) has the risk of opening the Australian market to more two stroke lawn mowers which has the greatest use of any outdoor powered equipment however it should see the continuance of the sole engine being manufactured in Australia In 1995 when it was introducing small engine emission limits the USEPA faced a similar issue with two stroke lawn mowers and used a similar approach by allowing two stroke lawn mowers to comply with the handheld standards It also specified that the number of two stroke lawnmower engines allowed to meet handheld standards would be subject to a declining annual production cap with the allowance provided by the production cap being phased out in 2003 There is also similar precedent for small engine emission limits that depend on engine type - European regulations for marine outboard motors set less stringent requirements for two stroke motors

Averaging Banking and Trading Provisions

The US EPA did not have averaging banking and trading provisions in Phase 1 and therefore all small outdoor engines were required to meet the Phase 1 limits It only introduced ABT provisions in the much more stringent Phase 2 as they would allow the most economic introduction of cleaner engines The industry claims the systems to use this provision are available and can be implemented in Australia by those who wish to use it at little cost to government

Industry claim that any supportive economic data related to averaging is sensitive and confidential It is there difficult without substantial justification by the industry to support the provision for averaging in conjunction with Phase 1 particularly given the elapsed time between the introduction of Phase 1 in the USA and their recommended introduction in Australia If there are some low volume equipment items that still cannot meet the USAEPA Phase 1 standards then these could be subjected to

32

exemptions if adequate justification can be provided (exemptions for small volumes were available under the USEPA regulations)

It was noted that for government to implement regulations a regulatory impact statement is required and this requires an assessment of the costs and benefits of the options considered with clear overall benefits shown for the preferred option Therefore if the option for manufacturers to use averaging were to be considered more information to support its inclusion would be required

Other options that could be considered to circumvent the inclusion of averaging include

i including clauses that give manufacturers the ability to apply for exemptions from the regulations for classes of equipment that have small sales volumes (these provisions are available in the USA)

ii limiting the regulation to popular types of equipment

iii using the end-of-model life provisions that have been used in the Australian Design Rules for cars In effect the end of model life provisions require new designs to comply from the implementation date but allow older models to remain on sale for a few more years This is an alternative to ABT because it facilitates earlier introduction of the regulation

iv Having a phase in period of say 2 years during which existing models can continue to be sold but new models coming on to the market must comply with the new standards At the end of the phase-in period all models must comply with the new standards This is an approach that is used when Australian Design Rules (ADRs) are introduced for motor vehicles

Consumer Information

Current Australian directions to reduce the environmental impact of consumer products favor tiered benchmarks using a lsquostarrsquo rating system (see Appendix 3 for examples such as the Mandatory Energy Efficiency Label and the Water Efficiency Labelling Scheme)

As products generally arrive in Australia assembled and packaged industry considers a mandatory requirement to label products with an Australian style star rating would impose a cost on distributors that would drive up the retail price of products Instead the OPEA members were willing to supply emissions data for inclusion in a web-based database that would allow purchasers to assess the environmental credentials of different makes and models Given the diverse nature of the industry it is unlikely a database would provide complete coverage of all products on the Australian market but inclusion in the database would indicate that the manufacturer has a commitment to environmental performance It was acknowledged in discussions that at least some Phase 2 compliant products would become available prior to 2012 and the web-based database would provide one method to promote those cleaner engines

33

In summary the Recommendations of the Expert Panel

1 Mandatory air pollutant emission standards to be introduced in Australia for all outdoor equipment (lt19kW) powered by spark-ignition engines The development of any regulation would need to be based on a formal assessment of the costs and benefits of nationally regulating 2 and 4 stroke lawn mowers and handheld power equipment which should be commenced immediately

2 Proposed standards to mirror US EPA regulations (compliance with equivalent EU regulations also acceptable)

3 Timing (subject to completion of assessment of costs and benefits)

(a) US EPA Phase 1 ndash Effective from 2007 2008

(b) US EPA Phase 2 ndash Fully implemented in 2012 (in step with 2007 USEPA limits) with phase-in period andor ABT over 2008-2012 to provide for early introduction of cleaner product

4 Walk-behind 2 stroke mowers to be included in US EPA Category 5 (gt50cc) product classifications Implementation timing to be as in Recommendation 3 above

5 All products also to be certified to relevant EPA durability categories

6 Subject to further review ABT (if included) may be phased out after 2012

34

7 The Way Forward

The optimum approach for garden equipment out engine emissions of options needs to be sustainable and cost effective This will need to be determined through a costs and benefits analysis (CBA) CBA assigns monetary values and typically assesses the impacts on the consumer on human health on the environment on industry and on government A detailed costs and benefits analysis is beyond the scope of this report however the following sections draws on available information to provide some indication of the possible costs and benefits that are associated with emissions from garden equipment engines

Air Quality Benefits

Environment Canada estimated the introduction of the regulations would result in a 44 percent reduction in combined HC+NOx emissions from small engines used in garden equipment and reduction in individual air pollutants over a 25 year period as shown in Table 15 The Canadian estimates incorporate the benefits that would accrue from the MOU signed with the industry in 2000 plus the benefits from the regulations introduced in 2003 In 2000 Canada imported around 13 million small spark-ignition engines and machines (ie a similar number to Australia) with 80 supplied by the USA

Table 15 Canadian Small Spark-Ignition Engine Emissions in Year 2025

Substance Base Case Emissions in 2025

Emissions in 2025 with Regulations

Percentage Reduction in 2025 (Regulations vs Base Case)

Criteria Air Contaminants (kilotonnes)

HC 772 410 469

NOx a 84 67 201

CO 1413 1403 07

Greenhouse Gas (kilotonnes)

CO2 2903 2645 89 Base case year 2000 (accommodating voluntary agreement) Source Canada Gazette Part II Vol 137 No 24 2003-11-19

Other Environmental Costs and Benefits

In addition to the human health benefits associated with reduced exposure to ozone there is a range of other public benefits including reduced damage to vegetation and therefore higher crop yields less damage to materials and structures particularly

35

some rubber products and improved visibility due to a reduction in smog haze Plus there are benefits associated with lower emissions of other air pollutants

To date there appears to have been little work undertaken in assigning a monetary value to these benefits as it is considered that they are likely to be small compared to human health impacts

Health Costs and Benefits

The Final Impact Assessment for the Ambient Air Quality National Environment Protection Measure (NEPC 1998) estimated that the health damage costs from exposure to ozone nationally to be in the range of $90 ndash $270 million (in 1998 dollars) This figure did not include mortality costs because of difficulty in assigning a figure to human life nor did it include costs associated with minor symptoms such as sore throat cough headache chest discomfort and eye irritation that can result from ozone exposure On the cost of ozone exposure the Impact Assessment states that lsquothe social well-being associated with potentially 6 and 20 million fewer irritating symptoms annually cannot be reliably quantified but at $1 a symptom it adds up to an appreciable amountrsquo

Since the Air NEPM Impact Assessment ozone levels in Australian urban areas have not fallen significantly but the population and medical costs have increased since then However using the above figures to make a rough estimate the contribution made by engines used in lawnmowers (ie not including other garden equipment) to the health damages cost from ozone exposure would be at a minimum $36 - $108 million not including the cost of mortality or minor symptoms As any action on these engines is likely to only remove high emission engines over a decade or more a CBA would be required to include an assessment of the proportional health benefits that would accrue from only removing the high emitters over time

Costs and Benefits to the Consumer

In 1995 the USEPA estimated that on average the cost to the engine manufacturer to install the necessary emission control technology to meet Phase 1 standards (which didnrsquot have ABT) would be approximately $US2 per engine used in nonhandheld equipment and $US350 per engine used in handheld equipment It also estimated that this would translate to sales-weighted average price increases of about $US7

The introduction of phase 2 regulations USEPA estimated would result in price increases of between $US20 and $US64 for handheld equipment depending on the equipment class (USEPA 2000) where handheld engines ranges in price from $60 to $1000 (USEPA 1995)

In addition to emission reductions the implementation of exhaust emission limits has the advantage of reducing fuel consumption and lowering operating costs to the consumer For example the USEPA estimated that for Phase 1 limits that applied between 1995 and 2001 on an average sales-weighted engine basis would decrease fuel consumption by 26 percent for non handheld equipment and a 13 percent decrease in fuel consumption for handheld equipment (USEPA 1995) Phase 2

36

(current limits) would result in a further decrease in fuel consumption of approximately 30 percent for handheld engines

When the USEPA considered the fuel savings offset and the retail price increase it estimated that the average sales-weighted lifetime increase in cost would be about $US650 per handheld engine while nonhandheld engines will realize a lifetime savings of about $US250 per engine This does not include the lifetime savings in maintenance costs which should further benefit the consumer (USEPA 1995)

Euromot (The European Association of Internal Combustion Manufacturers) claims that compliance with European minimum performance standards that do not have ABT provisions adds around 30 to the cost of some products that have had to be brought into compliance4 compared to products sold under the ABT system in the US

Costs and Benefits to Industry and Government

As there is only one local manufacturer among the 43 distributors of powered outdoor garden equipment sold in Australia and all others are importers the main costs to reduce the emissions contribution made by these engines will be associated with program administration and compliance particularly if regulations are introduced

The Productivity Commission an independent agency which is the Australian Governmentrsquos principal review and advisory body on microeconomic policy and regulation recently examined the cost effectiveness of measures to improve the energy efficiency in household appliances As part of its review lsquoThe Private Cost Effectiveness of Improving Energy Efficiencyrsquo it examined labelling programs (ie regulated tiered benchmarks) and minimum mandatory energy efficiency requirements (ie a regulated simple benchmark) While the household appliance market is considerably larger than the garden equipment market the Commissionrsquos final report contains some information that is useful for determining the approach that could be used to establish an emissions reduction scheme for garden equipment A summary of relevant sections of this report is provided in Appendix 3

The Commission identified both administration and compliance costs associated with labelling programs and minimum mandatory energy efficiency requirements as well the impacts these had on product suppliers

The Department of the Environment and Water Resources provided details to the Commission on the costs involved in administering both the labelling scheme and the minimum performance standards for energy programs The information provided showed that

bull the administration costs of the simple benchmark approach were substantially lower (less than one tenth) than for labelling and 84 per cent of administration costs were passed on to appliance purchasers with the remainder borne by governments

4 Presentation by Dr Holger Lochmann Rob Baker Axel Rauch Stihl 19 April 2006

37

bull the compliance costs for labelling are higher

bull minimum mandatory energy efficiency requirements can have a greater cost for suppliers than labelling since suppliers must adjust their model ranges to meet the MEPS levels by the given date These compliance costs are however influenced by the lsquolead inrsquo time between introduction and the implementation of the regulations

bull The increased cost to appliance purchasers of labelled appliances was about two and half times higher compared to appliances purchased under minimum mandatory energy efficiency requirements this being due to consumers voluntarily purchasing more efficient appliances

Overall the Commission considered that labels should be more actively considered as an alternative to minimum performance standards The Commissionrsquos support was based on the ability of labels to amongst other things

bull directly address ldquoa source of market failure mdash the asymmetry of information between buyers and sellers of energy-using productsrdquo

bull provide information to the consumer that is readily-accessible and easily-understood so they can help the consumer make better-informed choices

bull Have net social benefits and possibly have net benefits for consumers

bull provide a greater incentive for suppliers to sell environmentally better products

bull warn consumers through a disendorsement label that an appliance is very inefficient This approach can discourage but not prevent consumers from buying the poor performing product

71 Options to Reduce Emissions from Garden Equipment Engines

There is a range of options that could be considered for reducing emissions from engines used in outdoor garden equipment in Australia These include

1 Do nothing

2 Partnership Programs

3 Quasi regulation

4 Co-regulation

5 Regulations

In the following discussion about these options many Australian examples are mentioned Further details about these programs plus an overview are provided in Appendix 2

38

72 Option 1 ndash Do Nothing

Based on data supplied by OPEA the sales of high emitting two stroke carburettor engines as a percentage of engines used in outdoor equipment increased during the period 2002 to 2005-6 (see Table 12) from 463 to 593 and overall sales number increased by 38 during that period There is no indication that in the short to medium term that sales of equipment with two stroke carburetor engines will decrease in overall sales numbers or as a percentage of sales Therefore under the lsquodo nothingrsquo option emissions from outdoor garden equipment will continue at the same rate or perhaps based on sales figures of two stroke carburetor powered equipment at an even higher rate in the future

73 Option 2 ndash Industry - Government Partnership

In the discussion papers prepared for the NSW small engine project (2004) some examples of successful voluntary Government-Industry Partnership programs were provided The examples included were

bull the National Industry Reduction Agreement where the major newspaper and magazine publishers in Australia agreed to promote recovery and recycling of old newspapers and magazines

bull the NSW EPA-Oil Industry MOU on Summer Fuel the National Packaging Covenant (which has legislative backup) and

bull the EPA Victoriarsquos agreement with the Altona Chemical Complex

From the Australian programs reviewed it appears that the best indicators for successful partnership programs are

bull a relatively small number of firms within the industry

bull a commitment and involvement by all of the industry

bull clear program aims and objectives plus program targets and

bull a willingness by the industry to enter into a cooperative partnership with government

There are 43 identified distributors selling 97 brands of outdoor powered equipment in Australia Many of the major distributors are members of OPEA but there are many distributors who are not members It is therefore unlikely that the even the majority let alone all of the Australian distributors would commit to a industry-government partnership to reduce emissions

74 Option 3 - Quasi Regulation

Quasi regulations can take a range of forms the most usual being the establishment of a code of practice that industry endorses and implements A fundamental part of the code of practice would be emissions standards There are few examples of the use of codes of practice to limit emissions

39

Governmentrsquos role under this scenario is likely to be in assisting in the development of standards

The likelihood of this option being successful for similar reasons to the industry government partnership option is low

75 Option 4 -Co Regulation

Co-regulation is an agreement by industry and government to certain undertakings that support the uptake of cleaner products with a regulatory base It allows industry program flexibility to achieve certain negotiated targets Australian examples of coshyregulation include

bull The Green Vehicle Guide which operates through an industry government agreement where industry report test results to government in an agreed format within a certain timeframe Government manages the data and promotes the program This program is underpinned by Australian Design Rules for motor vehicles

bull The electrical appliance stand-by power program where there are agreed targets established that industry is required lsquovoluntarilyrsquo to meet failure to achieve the targets will result in regulation

bull The Packaging Covenant which is a program that allows industry the flexibility to design it own programs to reduce packaging waste and achieve certain target The Covenant is complemented by the NEPM on used packaging which specifies certain government responsibilities to support the program plus measures that will be introduced if targets are not met

Given the large number of distributors on the Australia market co-regulation for engines used in garden equipment using a similar form to the standndashby power program or the packaging program - an agreement by industry and government on a percentage reduction target for the sale of high emitting engines within a specified timeframe together with an agreement that regulation will be adopted if the target is not met ndash is also unlikely to be successful

76 Option 5 - Regulation

Regulation which requires a clear acknowledgement of a sufficient problem by Government places uniform mandatory compliance obligations on industry The costs associated with regulations are usually shared between government and industry with the development of regulations and program administration costs being borne by government with industry meeting compliance costs including emissions testing and if applicable labelling costs

It could argued that regulation should be introduced in the States or Territories where there are exceedances of the Air NEPM ozone standards However development of state based regulations for garden equipment engines emissions is unlikely as they would be incompatible with the 1992 Intergovernmental Agreement on the

40

Environment signed by the Commonwealth States and Territories and existing Commonwealth and State Government mutual recognition legislation The Intergovernmental Agreement on the Environment which underpins the development of National Environment Protection Measures obligates all jurisdictions to ensure equivalent protection from air pollution to all Australians

In addition enforcement of any state based legislation would be a key problem Under the Commonwealth Mutual Recognition Act 1992 and the Trans-Tasman Mutual Recognition Act 1997 goods that are imported into or produced in an Australian State or Territory or New Zealand that can be sold lawfully in that jurisdiction can be sold freely in a second jurisdiction even if the goods do not comply with the regulatory standards of the second jurisdiction This means non-regulated small engine products legally sold in one State could be legally sold in any other state regardless of whether emissions limits on small engines applied in that State

National regulation on the other hand would provide national consistency It would also provide the opportunity to adopt worldrsquos best practice standards and incorporate penalties for non-complying parties

Under the Australian Constitution the Commonwealth does not possess specific legislative powers in relation to the environment and heritage There are however a number of legislative powers that can support environment and heritage legislation Furthermore Commonwealth legislative powers can be used cumulatively For example the Commonwealth Parliament can make laws under section 51(20) of the Constitution with respect to ldquoforeign corporations and trading or financial corporations formed within the limits of the Commonwealthrdquo

Legislative mechanisms may also be created through the development of a National Environment Protection Measure (NEPM) that then becomes law within each jurisdiction A NEPM can accommodate flexibility of implementation where jurisdictions that have elevated ozone levels can tailor their NEPM program to their specific air quality needs An example of this flexible approach is the Diesel NEPM which has a suite of programs which can be implemented by jurisdictions

From the review of Australian regulations to reduce the environmental impacts of products and the overseas approaches to control emissions from small engines two regulatory approaches become apparent a simple benchmark or tiered benchmarks These are outlined below

Regulatory Option1 - A Simple Benchmark Approach

The most basic regulatory approach that could be taken would be to have a single emission standard (or as per the USA Europe and California a number of emission standards based on power and application) for combined HC + NOx emissions All equipment with new engines sold in Australia from the date the regulations are introduced This approach would

bull remove the all high emission engines from sale

41

bull be supported by an Australian Standard and

bull provide consumers with confidence that all products meet certain emissions standard

Regulatory Option 2 -Tiered Benchmarks

Current Australian directions to reduce the environmental impact of consumer products favour tiered benchmarks using a lsquostarrsquo rating system (see Appendix 2 for examples)

For engines used in garden equipment a tiered emissions labelling system could be based on the USEPA Phase 1 and Phase 2 standards use a system of lsquostarsrsquo to provide information to consumers about environmental performance but not limit consumer choice A tiered lsquostarrsquo system approach would

bull reward those products with more stars that meet the more stringent overseas standards

bull either operate with minimum emissions performance standards or disendorsement labels

bull be supported by a product label and possibly a web database

bull provide consumers emissions information and the option to purchase a lower emission engine

bull be supported by an Australian Standard and

bull be devised to meet worldrsquos best practice which is an overarching approach supported by Government

Table 16 summarises the main strengths and weaknesses of the above options

42

Table 16 Main Strengths and Weaknesses of Each Option

Strengths Weaknesses

Do Nothing Does not limit consumer choice Emissions contribution likely to grow No cost to government No barrier to new market entrants selling

high emitters Consumers have a wide choice of products Industry unchecked amp product dumping

likely No enforcement recourse on environmental grounds available

Partnerships Some sharing of responsibility government Slow if any reduction in high emitters

ndash industry

Potential for Government assist in Few if any companies likely to join and no advancing reductions in high emitters restrictions on non signatories Reduction targets set Below worldrsquos best practice

Quasi Regulation Similar strengths to partnership option Similar weaknesses to partnership option as

few if any companies likely to adopt code of practice

Co-Regulation Ongoing consultation between industry and Due to industry diversity targets unlikely to government recourse to regulation be met Targets set and can require new market Slow reduction in emissions entrants to achieve targets Can have implementation flexibility Emissions test standard adopted

Regulation Option 1- Simple Benchmark Worldrsquos best practice standards can be ovide incentives to manufacturers to promote low adapted and is mandatory emitters

Recourse to legal action available for non Does not provide consumers with emissions compliance information Significant quantifiable health benefits Cost of enforcement borne by taxpayers Requires compliance by all industry and High cost to government bans high emitters

Regulation Option 2 ndash Tiered Benchmarks Provides consumers with emissions information but does not limit choice Incentives for manufacturers to sell low emitters Potentially significant quantifiable health benefits Can be designed to overcome ABT issue

Significant administration and compliance costs to Government High cost to government and industry and will increase retail price of engines Does not ban high emitters

43

77 Preferred Approach

From the above discussion and from the review of garden equipment on available to the Australian consumer there are many companies selling powered garden equipment on the Australian market and the market is very competitive Furthermore from the Expert Panel discussions and stakeholder consultation it is apparent that it is highly unlikely that all the companies in the garden equipment industry would engage in or commit to a voluntary program to reduce their productsrsquo exhaust emissions It is therefore clear that the only feasible path to reduce emissions from these small engines is through regulation

While regulations of emissions from small engines used in garden equipment in Australia are likely to be based on overseas regulations they need to strike a balance between improved environmental outcome harmonisation with international standards and the characteristics of the local industry With regulation optimum emissions reductions are achievable especially by combining minimum emissions standards with tiered product labelling Whether this approach is justifiable on economic grounds that is the benefits outweigh the costs can only be determined through a detailed impact assessment Based on these findings it is recommended that a formal assessment of the costs and benefits of nationally regulating 2 and 4 stroke lawn mowers and handheld power equipment should now be commenced

44

References Air Resources Board California Environmental Protection Agency Californian Exhaust Emission Standards and Test Procedures for 2005 and Later Small Off-road Engines July 26 2004

Artcraft 2003 A Major Research-Based Review and Scoping of Future Directions for Appliance Efficiency Labels in Australia and NZ prepared for the Australian Greenhouse Office viewed at wwwenergyratinggovaulibraryindexhtml

Australian Bureau of Statistics 1999 Older People Australia A Social Report Report Number 41090 December 1999

Australian Greenhouse Office 2002 Achievements 2002 National Appliance equipment energy efficiency program Commonwealth of Australia

Australian Greenhouse Office 2002 Achievements 2002 National Appliance equipment energy efficiency program Commonwealth of Australia

AustralianNew Zealand StandardtradeASNZS 64002005 Water efficient productsmdashRating and labeling Federal Register of Legislative Instruments F2005L01571

Bei L T and Widdows R1999 Product knowledge and product involvement as moderators of the effects of information on purchase decisions a case study using the perfect information frontier approach Journal of Consumer Affairs 33(1) 165-186

Buy Recycled Busines Alliance Briefing Paper Environmental Claims And Labelling Abstract lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10-2003

California Code of Regulations 1998 Final Regulation Order Article 1 and Article 3 Chapter 9 Division 3 Title 13 Attachment 1 26 March 1998 wwwarbcagovregactsoreregs_finpdf

Canada Gazette Part II Vol 137 No 24 2003-11-19

Canadian Gazette 29 March 2003 Vol 137 No 13 Part 1 pp 935- 955

Cap Gemini Ernst amp Young (2001) Cars Online 2001 Global consumer survey httpa593gakamainet75931951a8b278a28319eawwwcgeycomhightechautomediaC ars_online2pdf

Clothes Washers Australiarsquos Standby Power Strategy 2002 ndash 2012 Standby Product Profile 200308 October 2003 wwwenergyratinggovau

Craig ndash Lees M Joy Sally Browne B 1995 Consumer Behaviour John Wiley amp Sons Queensland 1995

Department of Environment and Conservation NSW 2004 Measures to Encourage the Supply and Uptake of Cleaner Lawnmowers and Outdoor Handheld Equipment

45

Department of Environment and Conservation 2003 Who cares about the environment in 2003 A survey of NSW peoplersquos environmental knowledge attitudes and behaviours DEC Social Research Series

Department of Environment and Conservation Action for Air update 2006

Department of Environment and Conservation The Buy Recycled Guide Online Directory viewed at wwwresourcenswgovauindex-RNSWhtm

EcoRecycle 2004 Paint Take-Back Takes Off in Bayswater Media release 24 March 2004 viewed at wwwecorecyclevicgovau May 2004

Enviromower viewed at wwwenviromowercomau June 2004

Environment Canada 2000 Future Canadian Emission Standards for Vehicles and Engines and Standards for Reformulation of Petroleum Based Fuels Discussion Paper in Advance Notice of Intent by the Federal Minister of the Environment April 2000 wwwecgccaenergfuelsreportsfuture_fuelsfuture_fuels1_ehtm

Environment Canada 2004 Environment Minister Urges Canadians to Reduce Greenhouse Gas Emissions and Mow Down Pollution With Unique Incentive Program Media Release April 23 2004 viewed at wwwecgccamediaroomnewsrelease May 2004

Environment Protection and Heritage Council National Environment Protection (Ambient Air Quality) Measure Report on the Preliminary Work for the Review of the Ozone Standard October 2005

Environment Protection Authority 2006 Victoriarsquos Air Quality ndash 2005 Publication 1044 June 2006 wwwepavicgovau

Environmental Choice NZ 2001 Public Good and Environmental Labelling An Internal Background Paper

European Commission Directive 200344EC amending the recreational craft directive and comments to the directive combined 211005

George Wilkenfeld and Associates Pty Ltd with Artcraft Research and Energy Efficient Strategies Tomorrow Today 2003 Final Report A Mandatory Water Efficiency Labelling Scheme for Australia Prepared for Environment Australia June 2003

George Wilkenfeld and Associates 2003 A National Strategy for Consumer Product Resource Labelling in Australia prepared for the Australian Greenhouse Office December 2003 viewed at wwwenergyratinggovaulibraryindexhtml

Green Vehicle Guide wwwgreenvehicleguidegovau

Harrington L and Holt S 2002 Matching Worldrsquos Best Regulated Efficiency Standards ndash Australiarsquos success in adopting new refrigerator MEPS wwwenergyratinggovaulibrarypubsaceee-2002apdf

46

Harris J and Cole A 2003 The role for government in ecolabelling ndash on the scenes or behind the scenes lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10-2003

Holt S and Harrington L2003 Lessons learnt from Australiarsquos standards and labeling program Paper presented at ECEEE Summer Study - 2-6 June 2003 wwwenergyratinggovaulibraryindexhtml

IBIS 2006a Domestic Hardware Retailing 09-Jun-2006 Industry Code G523b

IBIS 2006b Gardening Services 18-Jan-2006 Industry Code Q9525

IBIS 2003 Gardening Services in Australia 23 December 2003 Industry Code Q9525

Lawrence K Zeise K amp Morgan P 2005 Management Options for Non-Road Engine Emissions in Urban Areas Consultancy report for Department for Environment amp Heritage Canberra

Motor Vehicle Environment Committee (MVEC) in consultation with the Department of Transport and Regional Services 2002 Proposal for an Australian ldquoGreen Vehiclesrdquo Guide viewed at httpwwwdotarsgovaumvegreen_vehicles_guidedoc May 2004

National Appliance and Equipment Energy Efficiency Committee The Energy Label at wwwenergyratinggovau (3504)

National Environment Protection Council 2005 National Environment Protection (Ambient Air Quality) Measure Report on the Preliminary Work for the Review of the Ozone Standard October 2005

National Environment Protection Council 1998 Final Impact Assessment for Ambient Air Quality National Environment Protection Measure June 1998

National Environment Protection Council 1999 Used Packaging Materials Impact Statement for the Draft NEPM Used Packaging Material January 1999 viewed at wwwephcgovau

National Environment Protection Council 2004 National Environment Protection (Air Toxics) Measure April 2004 viewed at wwwephcgovau

New South Wales Government 2002 Protection of the Environment Operations (Clean Air) Regulation 2002

New South Wales Government 1999 NSW Government Procurement Policy Statement White Paper 1999

Nordic Council 2002 Ecolabelling of marine Engines Criteria Document 8 December 1995 ndash 6 December 2005 version 35 December 2002

47

Office of Public Sector Information Statutory Instrument 2004 No 2034 The Non-Road Mobile Machinery (Emission of Gaseous and Particulate Pollutants) (Amendment) Regulations 2004 wwwopsigovuksisi200420042034htm

Outdoor Power Equipment Institute 2001 Profile of the Outdoor Power Equipment Industry wwwopeiorg

Productivity Commission 2004 The Private Cost Effectiveness of Improving Energy Efficiency Final report October 2005 wwwpcgovauinquiryenergy

Publishers National Environment Bureau Media Release lsquoAustralia leads the world in newspaper recyclingrsquo 6 June 2006 wwwpnebcomau

Real J Jones A 2005 The Green Vehicle Guide Clean Air Soceity of Australia and New Zealand Conference 2005 Hobart

Salmon G Voluntary Sustainability Standards and Labels (VSSLs) The Case for Fostering Them OECD Round Table On Sustainable Development

Schkade D A and Kelinmutz D N 1994 Information displays and choice processes differential effects of organization form and sequence Organizational Behavior and Human Decision Processes 57(3) 319-337

Stephens A 2003 Eco Buy (Local Government Buy Recycled Alliance Victoria) Abstract lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10shy2003

Teisl M F Roe B and Hicks RL 2002 Can eco-labels fine tune a market Evidence from dolphin-safe labeling Journal of Environmental Economics and Management 43339-359

Teisl M F Roe B and Levy A S Ecolabelling What does consumer science tell us about which strategies work pp141-150

The ISO 14000 family of standards guides and technical reports

The Parliament of the Commonwealth of Australia 2004 House of Representatives Water Efficiency Labelling and Standards Bill 2004 Explanatory Memorandum wwwcomlawgovauComLawLegislationBills1nsf viewed February 2006

Thogerson J 2000 Promoting green consumer behaviour with eco-labels Workshop on Education Information and Voluntary Measures in Environmental Protection National Academy of Sciences ndashNational Research Council Washington DC November 29-30

United States Environmental Protection Agency Federal Register Vol 60 No 127 3 July 1995 Control of Air Pollution Emission Standards for New Nonroad Spark-ignition Engines At or Below 19 Kilowatts wwwepagovEPA-AIR1995JulyDay-03prshy805txthtml

48

United States Environmental Protection Agency Federal Register Vol 69 No 7 12 January 2004 Rules and Regulations 40 CFR Part 90 Amendments to the Phase 2 Requirements for Spark-Ignition Nonroad Engines at or Below 19 Kilowatts Direct Final Rule and Proposed Rule wwwepagovfedrgstrEPA-AIR2004JanuaryDay-12a458pdf

United States Environmental Protection Agency Office of Pollution Prevention and Toxics Pollution Prevention Division 1998 Ecolabelling Environmental Labelling - A Comprehensive Review of Issues Policies and Practices Worldwide

United States Environmental Protection Agency Office of Transportation and Air Quality March 2000 Regulatory Announcement Final Phase 2 Standards for Spark-Ignition Handheld Engines

United States Environmental Protection Agency 1998 Proposed Phase 2 Emission Standards for Small SI Engines 27 January 1998

United States Environmental Protection Agency 2000 Regulatory announcement Final Phase 2 Standards for Small Spark-Ignition Handheld Engines March 2000 EPA420-F-00shy007

United States Federal Register Vol 69 No 7 Monday January 12 2004 Rules and Regulations Environmental Protection Agency 40 CFR Part 90 Amendments to the Phase 2 Requirements for Spark-Ignition Nonroad Engines at or Below 19 Kilowatts Direct Final Rule and Proposed Rule United States Federal Register Vol 64 No 60 30 March 1999 40 CFR Part 90 Phase 2 Emission Standards for New Nonroad Spark-Ignition Nonhandheld Engines At or Below 19 Kilowatts Final Rule pp15214-15216

United States Federal Register Vol 65 No 80 25 April 2000 40 CFR Parts 90 and 91 Phase 2 Emission Standards for New Nonroad Spark-Ignition Handheld Engines at or Below 19 Kilowatts and Minor Amendments to Emission Requirements Applicable to Small Spark-Ignition Engines and Marine Spark-Ignition Engines Final Rule pp24282-24284

United States Environmental Protection Agency Control of Air Pollution Emission for New Nonroad Spark-ignition Engines At or Below 19 Kilowatts Final Rule 40 CFR Parts 9 and 90 1995 wwwepagovEPA-AIR1995JulyDay-03pr-805txthtml

United States Environmental Protection Agency Office of Pollution Prevention and Toxics Pollution Prevention Division 1998 Ecolabelling Environmental Labeling- A Comprehensive Review of Issues Policies and Practices Worldwide

Victorian Government Greenhouse Strategy Community Action Fund - Mow Down Lawn Mower Rebate Exchange Program wwwgreenhousevicgovaucommunitygrantscafsuccessfulprojectshtm

Water Efficiency Labelling and Standards Act 2005 No 4 wwwcomlawgovauComLawLegislation

49

Water Efficiency Labelling and Standards Determination 2005 wwwcomlawgovauComLawLegislationLegislativeInstrument1nsf

Water Efficiency Labelling and Standards Regulations 2005 wwwcomlawgovauComLawLegislationLegislativeInstrument1nsf

Wilkie W 1994 Consumer Behaviour John Wiley and Sons NY as cited in Craig ndash Lees M Joy Sally Browne B 1995 Consumer Behaviour John Wiley amp Sons Queensland 1995

wwwenergyratinggovau

wwwgreenvehicleguidegovau

wwwwaterratinggovau

50

Appendix 1 Detailed Breakdown of Powered Garden Equipment on the Australian Market

The following table gives a profile of the current equipment on the Australian market It is based mostly on distributor responses to a survey and might not be representative of the total market

Low sales indicates that no sales data was available but volumes are likely to be small compared with popular equipment Phase 1 is US EPA Phase 1 or EU Directive 200288EU Phase 2 is US EPA Phase 2 or Euro standards

Type Ranges Stroke Aerator 5 makes 6 models Sales Low

Engine power 26 to 172kW Engine displ 143-674 ml

2c -4c 5 Unspecified 1 Phase 1 - Phase 2 4

Auger 3 makes 5 models Sales Low

Engine power 12 to 16kW Engine displ 31-ml

2c 5 4c -Unspecified -Phase 1 1 Phase 2 1

Backhoe 0 makes 0 model Sales Low

(2 models in 2003) -

Blower 13 makes 49 models Sales 109K

Engine power 07 to 31kW Engine displ 24-80ml

2c 34 4c 2 Unspecified 13 Phase 1 10 Phase 2 17

Blower-wheeler 3 makes 6 models

Engine power 07 to97kW Engine displ 24-305ml

2c 1 4c 4 Unspecified 1 Phase 1 3 Phase 2 -

Blowervac 6 makes 9 models Sales

Engine power 07 to 11kW Engine displ 24-34ml

2c 6 4c -Unspecified 3 Phase 1- Phase 2 3

Brush cutter 12 makes 95 models Sales 339K

Engine power 06 to 23kW Engine displ 21-54ml

2c 66 4c 5 Unspecified 24 Phase 1 15 Phase 2 34

Chainsaw 9 makes 106 models Sales 152K

Engine power 1 to 58kW Engine displ 26-122ml

2c 74 4c -Unspecified 32 Phase 1 18 Phase 2 27

Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

51

Type Ranges Stroke Clearing saw Engine power 14 to 27kW 2c 6 3 makes Engine displ 36-57ml 4c 0 9 models Unspecified 3 Sales low Phase 1 4 Phase 2 -Cultivator Engine power 07 to 52kW 2c 2 4 makes Engine displ 25-190ml 4c 5 7 models Unspecified -Sales low Phase 1 - Phase 2 5 De-thatcher Engine power 1kW 2c 1 1 makes Engine displ 27ml 4c -1 models Unspecified -Sales low Phase 1 - Phase 2 1 Drill Engine power 1kW 2c 3 3 makes Engine displ 27ml 4c -4 models Unspecified 1 Sales low Phase 1 - Phase 2 1 Edger Engine power 1 to 4kW 2c 12 10 makes Engine displ 24-190ml 4c 11 36 models Unspecified 1 Sales Phase 1 3 Phase 2 22 Garden tractor Engine power 12 to 157kW 2c -2 makes Engine displ 465 to 675ml 4c 5 12 models Unspecified 9 Sales low Phase 1 - Phase 2 3 Grass trimmer Engine power- 2c 3 1 make Engine displ 31ml 4c -3 model Unspecified -Sales Phase 1 - Phase 2 3 Hedge trimmer Engine power 06 to 1kW 2c 28 10 makes Engine displ 21-31ml 4c 1 42 models Unspecified 13 Sales 40K Phase 1 4 Phase 2 35 Lawnmower Engine power 26 to 66kW 2c 22 19 makes Engine displ 100-270ml 4c 151 183 models Price $449-$3609 Unspecified 10 Sales 424K Phase 1 95 Phase 2 48 Line trimmer Engine power 07 to 45kW 2c 25 8 makes Engine displ 24-195ml 4c 2 29 models Price $136-$299 Unspecified 2 Sales Phase 1 2 Phase 2 6 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

52

Type Ranges Stroke Log splitter Engine power 26 to 45kW 2c -1 makes Engine displ 100-195ml 4c 2 2 models Unspecified -Sales low Phase 1 - Phase 2 1 Multicutter Engine power 08 to 14kW 2c 17 5 makes Engine displ 23-36ml 4c 1 19 model Unspecified 1 Sales Phase 1 2 Phase 2 13 Olive nut shaker Engine power - 2c -1 make Engine displ - 4c -1 model Unspecified 1

Phase 1 - Phase 2 -Pole saw Engine power 08 to 14kW 2c 6 4 makes Engine displ 23-36ml 4c -10 models Unspecified 4 Sales low Phase 1 1 Phase 2 3 Power carrier Engine power 37 to 231kW 2c -2 makes Engine displ 160 to 953ml 4c 11 11 models Unspecified -Sales low Phase 1 - Phase 2 10 Power cutter Engine power 32 to 45kW 2c 5 2 makes Engine displ 64-99ml 4c -8 models Unspecified 3 Sales low Phase 1 1 Phase 2 3 Pruner (3 models in 2003) 2c -0 make 4c -0 models Unspecified -Sales low Ride-on-mower Engine power 26 to 231kW 2c -12 makes Engine displ 100 to 725ml 4c 93 124 models Unspecified81 Sales 51K Ph1 1 Ph2106 Rotary hoe (4 models in 2003) 2c -0 makes 4c -0 models Unspecified -Sales low Shredder Engine power 3 to 96kW 2c 1 6 makes Engine displ 126-389ml 4c 16 20 models Unspecified 3 Sales 46K Phase 1 - Phase 2 4 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

53

Type Ranges Stroke Stump grinder Engine power 96kW 2c -1 make Engine displ 389ml 4c 1 1 model Unspecified -Sales low Phase 1 - Phase 2 1 Tiller Engine power 08 to 59kW 2c -3 makes Engine displ 25-243ml 4c 8 9 models Unspecified 1 Sales low Phase 1 - Phase 2 7 Trencher Engine power37kW 2c -1 makes Engine displ 183ml 4c -1 models Unspecified 1 Sales low Phase 1 - Phase 2 1 Trimmer Engine power - 2c 10 2 makes Engine displ - 4c -21 models Price - Unspecified 11 Sales Phase 1 4 Phase 2 -Turfcutter Engine power 37kW 2c -1 makes Engine displ - 4c 1 1 models Unspecified -Sales low Phase 1 - Phase 2 -Vac Engine power 22 to 172kW 2c 1 5 makes Engine displ 158 to 674ml 4c 13 15 models Unspecified 1 Sales Ph11 Ph24 Vac chipper Engine power 34 to 45kW 2c -2 makes Engine displ 158-195ml 4c 3 3 models Unspecified -Sales low Phase 1 - Phase 2 1 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

54

Appendix 2 Examples of Current Australian Benchmarking Programs

The following describes in varying degrees of detail a number of current Australian benchmarking schemes classified by program type simple bench mark approaches tiered benchmarks and government industry partnerships This appendix concludes with a summary table of these programs with an assessment of their effectiveness

1 Introduction

Simple benchmark schemes (described below) such as the woodheater standards set a single point hurdle rate whereas the green vehicle guide use tiered benchmarks The new water efficiency labelling scheme and minimum energy efficiency performance standards uses both a simple benchmark through minimum performance requirement plus tiered benchmarks incorporated into labels as lsquostarsrsquo Other approaches such as the stand-by power program and the Victorian Altona Complex VOC reduction target set goals for achievement within a specified time period Other approaches taken to reduce environmental impacts include the National Packaging Covenant which uses a program based on individual companies developing tailored approaches to suit their circumstances and is supported by enforcement capability through the National Environment Protection (Used Packaging Materials) Measure (the NEPM)

2 Simple Benchmarks

21 Minimum Energy Performance Standards (MEPS)

Purpose

MEPS prescribe a minimum allowed energy performance for specific appliances Appliances that are less efficient than the relevant standard are excluded from the market

Background and Strategy

In October 1999 as part of the National Greenhouse Strategy (1998) nationally consistent MEPS and labelling schemes were adopted across Australia

Independent NATA accredited laboratories undertake product compliance checks to see whether products perform in compliance with MEPS requirements For example

bull In 2003 the government conducted check tests on eight appliance models all of which were found not to meet the claims made on the energy performance labels Two products were deregistered one was found to have not been registered and action was pending on the remaining five products (AGO 2003b)

55

bull Other regulatory actions undertaken in 2003 included fines of $3000 and $8000 against two Western Australian retailers who were found to have sold appliances without energy performance labels Queensland and Victorian retailers received infringement notices and fines totalling $10 000 (AGO 2003b)

Summary RegulNated minimum performance standards based on an Australian Standard

22 Energy Star

Purpose

An endorsement label that indicates an electronic product has achieved a specified standard when it is not performing its core function (ie on stand by)

Background and Strategy

Energy Star is a voluntary endorsement labelling program developed by the US Environmental Protection Agency (US EPA) It has been operating in the USA since 1992 and has been adopted by a number of countries including Australia Energy Star sets voluntary standards for reducing the electricity consumption of electronic equipment when it is not performing its core function

The Government stand ndash by program which is outlined below complements the energy star labelling program

Summary Voluntary endorsement label

23 Woodheater Standards

Purpose

To reduce particle emissions through Australian Standard compliant woodheaters

Background and Strategy

Since 1992 Australian StandardNew Zealand Standards have been introduced to improve the performance of wood heaters

The first standard for wood heater emissions AS4013 (1992) was published in 1992 and was revised and published as a joint AustralianNew Zealand Standard in 1999 ASNZS4013 (1999) Domestic solid fuel burning appliances - Method for determination of flue gas emission This Standard provides a test method to measure particles emitted by residential solid-fuel burning heating appliances

56

The 1992 Standard included an upper limit for acceptable particle emissions of 55 grams of particles per kilogram (oven-dry weight) of fuel burnt This emission factor was reduced to 4 gkg in the 1999 revision of the Standard The Standard applies to solid-fuel burning space-heating appliances (including those fitted with water heating devices) with a heat output of 25KW or less It does not apply to masonry fireplaces cooking stoves central heating appliances or water-heating-only appliances

AS 4013 (1999) is complemented by ASNZS4014 (1999) Domestic solid fuel burning appliances - Test Fuels and ASNZS4012 (1999) Domestic solid fuel burning appliances - Method for determination of power output and efficiency

The woodheater industry was instrumental in initiating the development of standards and it lobbied states and territories to enact legislation to mandating that woodheaters be required to meet the standards As the health affects of particle pollution have become more apparent and as some jurisdictions are having difficulty in meeting national particle standards Government has become more proactive in controlling woodheaters and more supportive of tighter standards

All states and territories with the exception of South Australia have regulations that restrict emissions from new woodheaters although Victoria for example only introduced its regulations in 2004 compared to Tasmania who introduced regulations in 1993 These regulations require that new woodheaters comply with the Australian Standard ASNZS 4013 The State regulations however are not uniform

Many woodheaters that are currently certified for sale do not comply with the revised standard as verified in a National Woodheater Audit Program undertaken in 2004 Seven of the 12 wood heaters tested failed to meet the ASNZS 4013 particle emission limit In addition 55 of heaters were found to have deviations from the original designs and 72 had labelling faults that could adversely affect emissions performance

Testing and certification are administered by the industry association

Summary State and regulations requiring compliance with Australian Standards Certification administered by industry association

24 Standby Power

Purpose

To reduce lsquoexcessiversquo energy consumed in electrical appliance standby mode sold in Australia through in the first instance voluntary targets Appliances covered by the program range from information technology equipment such as PCs and photocopiers entertainment equipment such as TVs DVDs and sound systems major appliances such as water heaters dishwashers and refrigerators and small appliances such as smoke detectors and bread makers

57

Background and Strategy

In 2000 standby power was estimated to constitute 116 per cent of Australiarsquos residential energy use costing households over $500 million and leading to the emission of over 5 million tonnes of carbon dioxide equivalent (AGO 2002c) Holt and Harrington (2004) estimated that standby power consumption in Australia could be reduced by 56 per cent by 2020 (Productivity Commission 2005)

In August 2000 all Australian jurisdictions agreed to pursue efficiencies in standby power consumption of energy-consuming products through support for the International Energy Agencys One -Watt program and endorse its incorporation into theprogram of work

Australia reportedly has taken the lead on implementing the One- Watt program even though many of the products sold in Australia are imported

During 2002 government agencies consulted with stakeholders about ideas to reduce standby The standby strategy which proposed a list of targeted potential product types was presented to the Ministerial Council on Energy

In September 2003 an interim test method for the measurement of standby power ASNZS 62301-2003 (int) based on an internationally recognised standard was published Also during this period work commenced on developing draft product profiles for high priority targeted products

Once product profiles are completed interim voluntary date-specific targets are made The product sales are then monitored to determine progress towards the interim target If it is then determined that inadequate progress is being achieved by a significant number of suppliers then government will regulate

For example the interim 2007 target for clothes washers is as follows

Product Off mode power End of program mode

lt 1W lt 4 W

The National Standby Strategy Target to be achieved by 2012 for clothes washers is as follows

Off mode power End of program mode lt 03 W lt 1 W

In support of the clothes washer program Government will

bull consider creating a Government Purchasing Policy to buy low standby clothes washers where available and fit for purpose

bull collect data on all modes for new clothes washers and analyse trends

bull highlight the range of performances by publishing performance data on clothes washers on a website or by other means

58

bull progressively include standby energy consumption into the Comparative Energy Consumption for labelled products such as clothes washers and clothes dryers

bull work with the Standards Committees to finalise the details of modes and test methods for the relevant standards

bull determine in 2008 if progress is inadequate and if regulation is required

Summary Industry targets possible future regulation

3 Tiered Benchmarks

31 Mandatory Energy Efficiency Label ndash the Energy Star Programs

Purpose

To enable consumers to easily compare the energy performance of electrical appliances used by households and firms through a labelling scheme

Background and Strategy

Several Australian states commenced mandatory energy efficiency labelling for major appliances in the mid-1980s In 1992 it became mandatory across Australia for initially refrigerators and later freezers clothes washers clothes dryers dishwashers and air-conditioners (single phase only) to carry the label when they are offered for sale This labelling program is regarded as one of the most successful in the world (Wilkenfeld and Assoc 2003) It is administered through the Australian Greenhouse Office

The energy rating label for dishwashers

(ldquoa joint government and industry programrdquo) and a website address (wwwenergyratinggovau) and has two main features

bull the star rating which gives a quick comparative assessment of the models energy efficiency and

bull the comparative energy consumption (usually kilowatt hoursyear) which provides an estimate of the annual energy consumption of the appliance based on the tested energy consumption and information about the typical use of the appliance in the home These values are measured under Australian Standards which define test procedures for measuring energy consumption and minimum energy performance criteria Appliances must meet these criteria before they can be granted an Energy Rating Label

The Energy Rating Label includes an endorsement

59

Awards Brand ModelInstallat

ionType

Phase Available

10 Yr Energy

Cost StarRating

Output(kW)

TOSHIBA

Digital Inverter Series Air

Conditioner RAV-SM1102BT-

ERAV-SP1102AT-E (

RAV-SM1102BT-ERAV-

SP1102AT-E)

SingleSplit

SystemDucted

Single $1500 1000

CHUNLAN

KFR-32GWVWa (

NO)

SingleSplit

SystemDucted

Single $645 323

Since its introduction the star rating label seems to have established a high level of recognition with consumers Consumer research (Artcraft 2003) indicates that the different information on the label appeals to different consumer segments interested in purchasing an appliance

When a manufacturer gains approval to use the label they pay for and produce the label in accordance with specifications on size colours fonts layout and design A similar colour scheme and design to the energy consumption label is also used for the compulsory fuel consumption label on new passenger and light commercial vehicles

The labelling scheme is underpinned by regulation whereby regulated Minimum Energy Performance Standards (MEPS) provide the environmental benchmarks that the appliances are required to meet Appliances that do not meet the minimum energy performance standards can be withdrawn from the Australian market

When the energy rating program was reviewed in 2000 technology had advanced to the point where a large percentage of appliances had achieved the maximum number of stars so the rating system was tightened It is estimated that over the 25 year period 1980 to 2005 there will have been an overall reduction in energy consumption of around 70 by the most popular sized refrigerators (with freezers) (Harrington L and Holt S 2002)

In addition to the energy consumption label there is a website (wwwenergyratinggovau) with a comprehensive database of all appliances their star rating and energy consumption In 2002 there were around 220000 hits on the programrsquos various websites and 523000 in 2003 reportedly representing 80000 visits by individual inquirers The website hit rate is estimated to represent almost 10 of consumers who are considering purchasing an appliance (Holt et al 2003)

Cooling

Energy Input (kW)

250

104

Figure B Excerpt from Energy Rating web page for Air Conditioners (cooling cycle only shown)

When the energy rating program was reviewed in 2000 technology had advanced to the point where the Scheme had to be tightened because a large percentage of appliances had achieved the maximum number of stars For example energy use by refrigerators was around 70 compared to that used when the scheme started (Harrington L and Holt S 2002)

60

Regulations

State and Territory legislation refer to the relevant Australian Standards This approach simplifies the State and Territory legislation and makes it relatively straightforward to maintain national consistency of appliance and equipment energy efficiency standards even when standards are continually being revised

The testing procedures and technical requirements for the label and also Minimum Energy Performance Standards (MEPS see below) are incorporated into the applicable Australian Standards Products for sale must be registered with one of the State regulators

Program Administration

The labelling program and MEPS program are administered by the National Appliance and Equipment Energy Efficiency Committee (NAEEEC) which is ultimately directed by the Ministerial Council on Energy

Requirements for Appliance Suppliers

Appliance suppliers are required to

bull Submit applications for product registration and these must include a test report or other data to demonstrate that the appliance meets the relevant Australian Standard

bull While test reports on three separate units are required for most products there is no particular requirement for test laboratories to be accredited or products certified for registration for energy labelling and MEPS in Australia Test reports from the manufacturers laboratory are satisfactory However if there is evidence that results from a particular laboratory are unsatisfactory regulators can mandate test reports from an accredited laboratory

Summary Mandatory labelling scheme backed by regulations and an Australian Standard

32 Water Appliances Water Efficiency Labelling and Standards (WELS) Scheme

Purpose

A labelling scheme backed by legislation to promote domestic water efficient appliances

Background and Strategy

A voluntary water efficiency industry administered labelling scheme has been in existence since 1988 The water efficiency ratings and details on the label design are covered in ASNZS 6400 The main incentive of the voluntary lsquoAAAAArsquo scheme

61

has been the publicity and cash rebates offered by water utilities However the coverage water efficiency performance requirements and impact of this program have been limited

In 2003 the Environment and Heritage Ministers agreed to implement a national Water Efficiency Labelling Scheme (WELS) for products such as shower heads washing machines dishwashers and toilets Consultation with industry and stakeholders was undertaken in 2003 with a strategic study published that identified the products to be included in the new labelling Scheme A Regulation Impact Statement (RIS) which identified the costs and benefits of various options and made various recommendations was published in March 2004 Following public review of the RIS some modifications were made to WELS

The WELS Scheme is backed by the following legislation and standard

Water Efficiency Labelling and Standards Act 2005 which establishes

bull the products subject to the Scheme and the requirements for registration and labelling

bull the standards to apply to WELS products setting requirements for water efficiency performance registration and labelling of these products

bull enforcement provisions including penalties bull the appointment of inspectors to investigate possible contraventions and sets

out their powers and obligations bull review and dispute resolution bull a program Regulator bull the making of regulations bull a requirement for annual reports and for an independent review after five years

Water Efficiency Labelling and Standards Regulations 2005 which

bull prescribes the circumstances in which a person other than the manufacturer of a WELS product may be taken to be the manufacturer of the product (eg an importer)

bull sets out procedures for the issuing and the payment of penalty infringement notices as an alternative to prosecution for offences against the WELS Act

bull specifying the information to be included on an identity card issued to a WELS inspector

Water Efficiency Labelling and Standards Determination 2005 amongst other things determines and establishes product registration fees and calls up the Australian Standard ASNZS6400 2005 Water-efficient products - Rating and labelling which

bull defines the products

bull specifies the assessment procedures (ie identifies test procedures in other Australian Standards)

bull provides the formulas to give products their star rating

bull specifies the labels and their application to products

62

Approximately twenty organisations were represented on the Standards Committee that developed the Standard

State and Territory legislation

The States and Territories have also enacted or agreed to enact complementary legislation to ensure that the WELS Scheme has comprehensive national coverage State and Territory legislation which is almost a mirror of the Commonwealthrsquos Water Efficiency Labelling and Standards Act 2005 enables the States and Territories to for example undertake certain responsibilities delegated to them by the Commonwealth Regulator appoint their own inspectors and enforce the WELS

Other features of WELS include

bull A product web database

bull With the exception of toilets no other products are required to meet mandatory water efficiency requirements (WES) but this may change over time The introduction of mandatory WES means that products not meeting the minimum performance requirements can not legally be sold

bull Products must be tested in accordance with the relevant Standard and must meet any minimum performance and water efficiency requirements in the Standard before they can be granted a WELS Water Rating label

bull It is up to manufacturers or their agents (eg importers in the case of imported products) to ensure that their products are correctly registered and labelled and comply with any other requirements of the Standard

There is a transition phase which gives manufacturers and importers time to test register and label products and to sell pre-existing stock From 1 January 2008 all products are required to display the WELS Water Rating labels irrespective of their date of supply

63

The WELS Water Rating label

Label Features

bull A star rating for a quick comparative assessment of the models water efficiency

bull Labels with 1 to 6 stars

bull Some products may also be labelled with a Zero Star Rated label which indicates that the product is either not water efficient or does not meet basic performance requirements

bull A productrsquos water consumption figure

bull There are provisions for swing tags if there is inadequate surface area for label or the item is likely to be marked by sticking the label on the product

Summary Mandated product labelling using lsquostarrsquo rating system Has a disendorsement label and has provisions to ban products

33 Gas Appliance Rating Scheme

Purpose

A gas labelling program to improve the energy efficiency of gas powered products

Background and Strategy

The Gas and Fuel Corporation of Victoria introduced energy labelling for gas water heaters in 1981 This scheme was taken over by the AGA in 1985 who in 1988 introduced a six star energy performance label This label was intended to be visually consistent with the star rating labels already familiar to consumers of electrical appliances

The labelling scheme is currently voluntary and still administered by the industry body

A range of gas appliances have been subject to minimum energy performance standards (MEPS) since the 1960s The current MEPS levels were set in 1983 and

64

Brand Model Type MjyearStar

RatingSRI

StorageCapacity

(ltrs)IndoorOutdoor

NaturalGas

Instantaneous 18969 59 I N

Instantaneous 18969 59 I N

lsquothe majority of models currently on the market appear to exceed current requirements by a comfortable marginrsquo (SEAV 2003 p 23)

The gas energy labels are similar in format to those found on electrical appliances except they are blue and show annual energy use in MJ

A trial web site listing gas water heaters available in Australia is also available (see below)

Bottle Gas

Rinnai Infinity

V Series

REU-V2632FFU-A (Infinity 26 plus internal) P

Rinnai Infinity

V Series

REU-V2632FFUC-A (HD2001 internal) P

A joint review of the scheme is under way by the Gas Industry and Governments and regulation is under consideration A three year work plan has been published under the Australian and New Zealand Appliance and Equipment Energy Efficiency Program

Summary Currently voluntary labelling using lsquostarrsquo rating system with mandatory minimum energy performance standards Future regulation is under consideration

34 Green Vehicle Guide

Purpose

To provide web-based comparable and accessible environmental data on new motor vehicles

Background and strategy

65

The Commonwealth government started publishing a booklet of fuel consumption data for new passenger and light commercial vehicles in the early 1980s and a low cost web database in more recent years

In 2004 the Government through the Department of Transport and Regional Services (DOTARS) expanded the fuel consumption guide into the Green Vehicle Guide The Green Vehicle Guide is a web based database that rates new passenger and light commercial vehicles on air pollution greenhouse emissions and fuel consumption and gives an overall lsquostarrsquo rating for each vehicle within each vehicle category (small medium luxury sports etc)

The data on which the scores are derived are provided voluntarily by the vehicle manufacturers however this data is based on mandatory Australian Design Rule certification test data

The Guide uses a 5 star rating system however it also assigns half stars resulting in a total of 10 levels

The Greenhouse Ratings are based on carbon dioxide emissions and the Air Pollution Ratings take into account the relative environmental impact of oxides of nitrogen hydrocarbons and particles The relative harmfulness of the pollutants (shown in table below) has been quantified based on the allowable concentrations under the Ambient Air Quality National Environment Protection Measure (NEPM)

Green Vehicle Guide Weighting of Regulated Vehicle Emissions

Vehicle Emission

(equivalent pollutant under Air NEPM)

Calculated

Relative

Harmfulness

Final

Weighting

Carbon Monoxide (CO) 0088 Not included

Oxides of Nitrogen (NOx) (based on

Nitrogen Dioxide)

4 1

Hydrocarbons (HC) (based on

photochemical oxidants as ozone)

5 1

Particulate Matter (PM) (based on PM10) 20 5

Source Real and Jones 2005

NOx and HC were given equal final weightings despite the slight difference in the calculated relative harmfulness primarily because under ADR7900 a combined HC+NOx limit is prescribed rather than individual limits for each pollutant

The higher weighting for particulate matter recognises its significant health impacts The Air Pollution rating scale was devised in such a way that a lsquotypicalrsquo car (that is most petrol engined passenger cars meeting the current emission standard at the time) receives a mid-point rating (5 out of 10)

66

The overall rating or stars is derived from the sum of the air pollution and greenhouse scores ie they are equally weighted

Development of the Green Vehicle Guide (see extract below) involved extensive consultation with vehicle manufacturers

Website Costs

The new highly automated web database which contains data on approximately 1400 vehicles and has sophisticated search facilities cost approximately $200000 to develop plus around $100000 was spent recently to improve the sitersquos usability This compares to the previous low cost database which together with the printed guide cost less than about $80000 per annum The low cost version lacked the automation was only updated annually and did not have the ability to compared vehicles

The manufacturers provide the data on line using special access codes This data is checked by DOTARS before it is uploaded onto the website It takes close to a full time position within DOTARS to administer the website and respond to website related queries

Market Research and Marketing

Before the new greenvehicleguidegovau website was launched DOTARS commissioned consumer surveys to determine the level of knowledge about the environmental impacts made by vehicles This research showed that around half of those surveyed had the belief that ldquoall new cars have the same level of impact on the environmentrdquo

It became apparent through the surveys that there was a need to provide consumers with meaningful information on the relative performance of different vehicles This was a view shared by the Productivity Commission who said that while markets provide extensive information to consumers regarding fuel consumption of motor vehicles ldquothe Australian Governmentrsquos Fuel Consumption Labelling Scheme and Green Vehicle Guide provide relatively low cost accessible and comparable information to consumers and may be justified as part of the more fundamental objective of encouraging consumers to reduce the adverse environmental impacts of motor vehicle userdquo The Productivity Commission also commented that government

67

sources of information of this type were seen as credible and reliable and held in higher regard than information provided by others

DOTARS has scheduled some follow up consumer research for 200062007

DOTARS has spent about $600000 in marketing the Green Vehicle Guide This has included advertising in weekend guides in newspapers developing facts sheets plus targeted marketing to motor vehicle journalists

Summary Website - voluntary but legislative base

4 Government-Industry Partnership programs

Government-Industry Partnerships are the basis of many environmental initiatives and can take a number of forms Industry and government negotiate the terms of the program which are normally detailed in a formal agreement which sets out the environmental objectives and the responsibilities of each party towards their achievement

The GovernmentIndustry Partnership programs outlined below indicate the varied nature of these initiatives

41 The National Packaging Covenant

The National Packaging Covenant (the Covenant) commenced in 1999 and is a voluntary agreement between all levels of government and companies throughout the packaging chain including raw material suppliers packaging producers and retailers The Covenant commits signatories to the implementation of best practice environmental management in areas such as packaging design production and distribution and research into life cycle issues Signatories to the Covenant produce action plans on the measures they will implement to reduce packaging waste and they report annually on their progress In this sense the Covenant provides flexibility to signatories to develop plans suitable to their own circumstances The Covenantrsquos success (it currently has over 600 signatories) is due to the active promotion of it by Government and key industry players

The Covenant is complemented by a regulation the National Environment Protection (Used Packaging Materials) Measure (the NEPM) which enables states and territories to use enforcement action to require companies that donrsquot sign the agreement to take steps to reduce their packaging waste Preceding the Covenant and the NEPM were a number of voluntary industry agreements but these were limited in scope and largely focused on companies in the beverage industry

42 National Industry Reduction Agreement

The Publishers National Environment Bureau (PNEB) was formed in 1990 as an association of the major publishers of newspapers and magazines in Australia to promote the recovery and recycling of old newspapers and old magazines primarily from community kerbside collections organised by local councils

68

The PNEB and a newsprint manufacturer have voluntarily entered into a series of five-year Industry Waste Reduction Agreements with the Commonwealth and State Governments Under the current (third) plan 2001-2005 newsprint recycling in Australia has grown to 754 nationally in 2005 from the 28 level when the PNEB was formed in 1990

43 StateLocal target based programs

There have been a number of agreements signed by state government departments and an industry group where there is a stated goal to reach a specific environmental target For example in the early 1990s there was a voluntary agreement with the EPA Victoria and companies in the Altona Chemical Complex in the western suburbs of Melbourne (which includes Australian Vinyls BASF Dow Chemicals and Qenos) to reduce hydrocarbon emissions by 50 within a specified timeframe The target was met and further emissions reductions were negotiated The NSW EPA-Oil industry petrol volatility agreement outlined below is another example of a target based program

44 NSW EPA-Oil Industry Memorandum of Understanding on Summer Petrol Volatility

In 1998 NSW established arrangements for the supply of low volatility petrol in summer in the Sydney Greater Metropolitan Region implemented through a Memorandum of Understanding between the then EPA and oil companies The principal reason for controlling petrol volatility in summer is to reduce evaporative emissions of VOCs (from vehicles and production and storage sites) which contribute to ozone formation

The Memorandum of Understanding operated over four summer periods from 1998 to 2002 and involved companies voluntarily reducing petrol volatility (measured in kilopascals (kPa) of vapour pressure) over three summer periods from a base of 76kPa to 70kPa in the first summer 67kPa in the second and 62 kPa in the last two years

Although the Memorandum of Understanding was successful in progressively reducing petrol volatility over the period of its operation it was not supported by all industry members Consequently agreement was reached with industry that summer petrol volatility limits should be regulated to ensure a level playing field for all industry participants and regulated limits will apply from the summer of 200405

69

5 Summary of Australian Benchmark Programs

Program National State

Summary of Approach Impact

Voluntary Programs Altona Chemical Complex (Vic)

Local Small industry group worked towards self determined targets

Very high

Energy Star National Standards based label Limited Gas appliance Rating Scheme

National Industry operated labelling scheme with stars assigned therefore has graded benchmarksminimum performance standards out dated web database being developed

Low

National Industry Reduction Agreement

National Small industry group worked towards negotiated targets

High

NSW EPA-Oil Industry MOU

State Small industry group worked towards negotiated targets but not all involved ndash lead to regulations

Moderate

Top Energy Saver Award

National Achievement based label Limited

Quasi Regulatory Green Vehicle Guide

National Well promoted web database star ratings assigned therefore has graded benchmarks data provided voluntarily but backed by ADR requirements

High

Stand-by power National Required to achieve voluntary targets or regulation will be introduced

Unknown

National Packaging Covent

National Performance based targets backed by legislation High

Regulatory Energy Efficiency Labels

National Labelling scheme with stars assigned therefore has graded benchmarksbased on Australian Standard web database

High

MEPS National Sets base benchmark and works with energy rating

High

WELS Scheme National Labelling scheme with stars assigned therefore has graded benchmarksbased on Australian Standardweb database

High

Wood heaters State Only one benchmark assigned regulations are not uniform

Moderate

authorrsquos assessment based on direct or indirect knowledge of these programs

70

Appendix 3 Productivity Commission Comments on Labelling and Minimum Performance Standards

The Productivity Commission an independent agency which is the Australian Governmentrsquos principal review and advisory body on microeconomic policy and regulation recently examined the cost effectiveness of improving energy efficiency As part of its review lsquoThe Private Cost Effectiveness of Improving Energy Efficiencyrsquo it examined labelling programs minimum mandatory energy efficiency requirements and other means of providing consumer information The final report contains some highly relevant material that is applicable to establishing a benchmarking scheme for small engines

The following is a summary of relevant conclusions from the Inquiry

Government Operated Labelling Schemes

From consumer research provided to the Commission it concluded that ldquothere is some evidence to suggest that consumers are now paying more attention to labels than they have in the pastrdquo

The Commission was positive about labelling programs as labels

bull directly address ldquoa source of market failure mdash the asymmetry of information between buyers and sellers of energy-using productsrdquo

bull provide information to the consumer that is readily-accessible and easily-understood and therefore can assist in helping the consumer make better-informed choices

bull are likely to have produced net benefits for consumers

bull do not directly limit consumer choice

bull could provide a greater incentive for suppliers to sell products that use energy cost effectively

bull probably produced net social benefits

bull are most suited where there is a wide spread in the range of performances of comparable appliances and where information failures are most pronouncedrdquo

bull can be used to warn consumers that an appliance is very inefficient (through a disendorsement label) which could be effective in discouraging but not preventing consumers from buying the poor performing product

The Commission was supportive of Governmentrsquos role of drawing together and packaging information through labelling programs as this ensures that ldquorelevant and trusted information gets to those who would otherwise not get itrdquo In material reviewed by the Commission George Wilkenfeld and Associates and Energy Efficient Strategies (1999) claimed that labelling is unlikely to be effective if purchasers rarely inspect appliances in a showroom where they can compare performance across

71

different models or the purchaser is not the ultimate user and so has little interest in operating costs

Labelling programs involves both administration and compliance costs such as those incurred by suppliers in having their products tested but the Commission considered that labels should be more actively considered as an alternative to minimum performance standards

Minimum Performance Standards

Governments can prevent the sale of inefficient products by using minimum standards for example the Minimum Energy Performance Standards (MEPS) that apply to appliances such as refrigerators and freezers air conditioners and electric water heaters If appliances do not meet the minimum standard they cannot be sold in Australia Some appliances are covered by both MEPS and by labelling (for example refrigerators)

The Commission considered that MEPS and labels can be complementary as MEPS act to penalise the worst energy performers whereas labels rewarding the better performers

Costs comparisons of schemes

The Department of the Environment and Water Resources provided details about the costs involved in administering both the labelling scheme and the minimum performance standards for energy programs It stated that

bull the administration costs of MEPS are substantially lower than for labelling but the compliance costs can be higher

bull MEPS can have a greater cost for suppliers than labelling since suppliers must adjust their model ranges to meet the MEPS levels by the given date These compliance costs are however influenced by the lsquolead inrsquo time between the introduction of the regulatory proposal and the implementation of the MEPS

bull it is estimated that the administration costs for MEPS would be $3 million over the period 2000ndash15 compared to $39 million for labelling (in present value terms) (George Wilkenfeld and Associates and Energy Efficient Strategies 1999) Furthermore it was assumed that 84 per cent of administration costs were borne by appliance purchasers with the remainder borne by governments

It estimated that MEPS would increase the cost of appliances by $266 million over 2000ndash15 compared to $688 million for labelling (the latter cost being due to consumers voluntarily purchasing more efficient appliances)

72

Page 11: Outdoor Garden Equipment - Department of the Environment

Conclusion

From this review it is apparent that it is highly unlikely that the companies in the industry would engage in or commit to any voluntary type program It is therefore clear that the most expedient path to reduce emissions from these small engines is through national regulation State based regulations could only provide a piecemeal approach that would lead to product dumping in states where there are no regulations and inconsistent regulations that require industry to treat each state market differently In addition enforcement of any state based regulations would be a key problem due to existing Commonwealth and State Government mutual recognition legislation

While any national regulation of emissions from small engines used in garden equipment in Australia are likely to be based on overseas regulations they need to strike a balance between improved environmental outcome harmonisation with international standards and the characteristics of the local industry With regulations optimum emissions reduction are potentially achievable by combining minimum emissions standards with tiered product labelling Whether this approach is justifiable on economic grounds that is the benefits outweigh the costs can only be determined through a detailed impact assessment Based on these findings it is recommended that a formal assessment of the costs and benefits of nationally regulating two and four stroke lawn mowers and handheld power equipment should be commenced

vii

1 Introduction

This report sets out the results of a project to compare and benchmark emissions from engines used in outdoor garden equipment that were available for sale in Australia during 2006 Possible outcomes from the project range from consumer guidelines for selecting low emission engines to regulatory controls on emissions There are currently no state or national regulations that directly control emissions from these engines

The project was commissioned by the Commonwealth Department of the Environment and Water Resources on behalf of state and territory government departments working on reducing the impacts of small engine emissions This report was prepared in consultation with an Expert Panel that included representatives from the Outdoor Power Equipment Association (OPEA)

11 Emissions from outdoor garden equipment engines

Small engines particularly conventional two stroke engines used in applications such as outdoor garden equipment are high polluters relative to their engine size and usage1 These small engines emit volatile organic compounds (VOCs) and oxides of nitrogen (NOx) which contribute to ozone (photochemical smog) formation in summer They also emit particles carbon monoxide (CO) and a range of air toxics such as benzene The USA California Canada and Europe and regulate emissions of VOCs NOx carbon monoxide and particle emissions from outdoor garden equipment

There are five types of spark-ignition engines that can be used in outdoor garden equipment

bull two stroke with carburettor (2c)

bull two stroke with pre-chamber fuel injection (2i)

bull two stroke with direct fuel injection (2di)

bull four stroke with carburettor (4c)

bull four stroke with fuel injection (4i) (includes direct injection)

Carburettor and pre-chamber fuel injection two stroke engines are inherently more polluting than the other three types This is due to their inability to completely separate the inlet gases from the exhaust gases resulting in up to 30 of the fuel being left unburnt and the need to add oil to the fuel to lubricate the engine (four stroke engines have separate reservoirs for fuel and oil) However twostroke carburettor engines typically weigh less than a four stroke engine of the same power and this tends to make them attractive for handheld equipment They also tend to have fewer components are generally cheaper to purchase and are cheaper to maintain than

1 Outdoor equipment covered in this report are engines less than 19kW

1

four stroke motors Victa Lawncare is currently undertaking research and development to improve the environmental performance of two stroke carburettors and while some emission improvements have been made a two stroke compliant with US or European standards is still considered several years away

Four stroke carburettor engines are generally quieter more fuel efficient and are less polluting than conventional two stroke engines

Direct fuel injection (dfi) either two stroke or four stroke overcomes the unburnt fuel problem and can meet the stringent regulated exhaust emission limits that apply overseas However there is not any evidence that dfi engines are being used in outdoor garden equipment available in Australia It appears that engines used in outdoor garden equipment in Australia are generally restricted to two and four stroke carburettor engines

Small engines are not as advanced in environmental terms as motor vehicle engines As a result even the better-performing small engines emit far greater quantities of pollutants per hour than typical modern car engines For example the US Environmental Protection Agency (USEPA) 2002 limit for a typical 4 kilowatt (kW) lawnmower motor is about 66 grams (g) of regulated pollutants per hour of operation A typical 08kW brushcutter sold new in 2002 emitted about 160grams of pollutants per hour - reducing to 40grams per hour if bought new in 2006 The equivalent limit for cars under Australian Design Rule 79 is about 16g per hour In other words operated over a similar time one hour of operation of a brushcutter that meets USEPA 2002 limits produces the same pollution as ten cars and a 4kW lawnmower the same pollution as four cars These comparisons are subject to differences in test methods but they do provide an indication of the disproportionate amount of pollution emitted by small engines

Engines that do not comply with current USEPA requirements are likely to emit several times the amount of pollution calculated in the above example Therefore the worst performing engines are likely to emit some ten times the emissions of the best performers

Because of the combustion of oil these engines also emit high levels of particles Although small engines only contribute a small amount to total particle emissions the rate of particle release compared to other engines can be very high For example lawnmowers can emit over 10 times more particles (in terms of grams per hour) than a petrol motor vehicle (manufactured between 1994 and 2001)

All the above emission comparisons between outdoor garden equipment engines and motor vehicles are subject to differences in test methods but they indicate the disproportionate amount of pollution emitted by small garden equipment engines It also needs to be recognised that motor vehicles in Australia average more than 15000 kilometres per year (ABS 2003) while the annual average use of outdoor garden equipment is around 25 hours for a lawnmower and less for other types of equipment Commercial operators however are likely to have a much higher usage rates than the general public

2

This paper examines the Australian market for small engines used in lawnmowers and handheld garden equipment their impact on air quality relevant overseas regulations and their applicability to Australia and makes recommendations to reduce air quality impacts from these engines

A wide range of information sources has been referenced for this report including data and information supplied by manufacturers distributors and dealers in small engines

3

2 Air Quality and Outdoor Garden Equipment Engines

Emission inventories make estimates of emissions of substances from a multitude of sources into airsheds The National Pollutant Inventory (NPI) which is run cooperatively by the Australian state and territory governments contains data on 90 substances that are emitted to the Australian environment The substances included in the NPI have been identified as important because of their possible health and environmental effects Industry facilities estimate their own emissions annually and report to states and territories Non-industry (or diffuse) emissions estimates which includes emissions from outdoor garden equipment are made by the states and territories on a periodic basis using information sources such as surveys databases and sales figures

The NPI only reports emissions from domestic lawn mowing and for a few airsheds the contribution made by public open space lawn mowing It does not report on the contribution made by other types of outdoor garden equipment such as brushcutters National and selected state NPI emissions estimates for the common air pollutants and for Air Toxics NEPM pollutants from domestic lawn mowing are summarised in Table 1 It should be noted that national emissions from lawn mowing are underestimates as the NPI records emissions for major airsheds only and therefore is not Australia wide plus the estimates do not include evaporative emissions from fuel tanks and hoses

This NPI data is indicative only as the accuracy and completeness of the data sets varies across airsheds and is reliant on the estimation techniques used For example while the population in the NSW is higher than other airsheds its emissions look disproportionally high when compared to the other airsheds This could be because the estimation technique varies or it is due to some other factor

4

Table 1 National Pollutant Inventory Domestic Lawn Mowing Emission Estimates

Substance Port Phillip

Population 34 mill (1996)

SE Qld

Population 23 mill

NSW GMR

Population 47 mill

Adelaide

Population 10 mill

National

Common Air Pollutants (tonnesyear)

Carbon monoxide 12000 12000 24000 6100 69000

Total Volatile Organic Compounds 3600 3800 7000 2000 21000

Particulate Matter 100 um 86 94 170 9 460

Sulphur dioxide 5 5 9 50 81

Oxides of Nitrogen 63 54 120 24 330

Air Toxics (tonnesyear)

Benzene 230 210 390 130 1200

Formaldehyde 56 38 NA 31 180

Polycyclic aromatic hydrocarbons 07 11 21 04 41

Toluene (methylbenzene) 370 360 660 210 2000

Xylenes (individual or mixed isomers) 270 260 490 150 1500

Analysis of the NPI database at the national level shows that domestic lawn mowing is the

- Fourth largest source of benzene contributing 7 to the total reported airshed load

- Fourth largest source of formaldehyde contributing 3 to the total reported airshed load

- Fifth largest source of xylene contributing 6 to the total reported airshed load

- Fifth largest source of toluene contributing 6 to the total reported airshed load

- Sixth largest source of carbon monoxide contributing 12 to the total reported airshed load

- Ninth largest source of VOCs contributing 3 to the total reported airshed load when biogenics (natural sources such as trees and soil) are excluded

The NSW Department of Environment and Conservation has been upgrading its emissions inventory Based on 2003 emissions data non-road anthropogenic sources

5

contribute 619 of the VOCs to the GMR airshed Preliminary results2 indicate that VOC emissions from domestic and public open space lawn mowing contributes on an annual average 41 of all VOC emissions in the GMR On a typical weekend during warmer weather this percentage rises to 11

Therefore it could be assumed that lawn mowing could contribute approximately 4 on average to VOC emissions from anthropogenic sources in major airsheds in Australia when public open space lawn mowing is included This percentage is likely to rise significantly in the warmer spring and autumn weekends which is when lawns and other vegetation grow faster and when more people garden

21 Air Quality Standards

In June 1998 the National Environment Protection Measure for Ambient Air (Air NEPM) established national uniform standards for ambient air quality for the six most common air pollutants ndash carbon monoxide nitrogen dioxide photochemical oxidants (measured as ozone) sulfur dioxide lead and particles less than 10 microns (PM10) The NEPM was varied in 2003 to include PM25 advisory reporting standards and in April 2004 a National Environment Protection Measure for Air Toxics was adopted

Nationally the common pollutants of most concern (particularly in major urban areas) are fine particles and ground level photochemical smog (measured as ozone) which is formed in the warmer months when volatile organic compounds (VOCs) and oxides of nitrogen (NOx) react in the atmosphere under the influence of sunlight in a series of chemical reactions

Recent health studies (cited in NEPC 2005) have strengthened the evidence that there are short-term ozone effects on mortality and respiratory disease The studies also strengthen the view that there does not appear to be a threshold for ozone below which no effects on health are expected to occur In recent years Australian epidemiological studies have been conducted which confirm the results of overseas studies that there is a relationship between elevated ozone levels and hospitalisations and deaths from certain conditions

There are two national ozone standards a one hour standard of 010ppm and a four hour standard of 008ppm with a goal that allows for one exceedance per year by 2008 Sydney experiences a number of days each year of ozone levels above these standards In 2003 Sydney exceeded the one hour standard on 11 days in 2003 19 days in 2004 and 9 days in 2005 The four hour standard was exceeded on 13 days in 2003 19 days in 2004 and 13 days in 2005 Further reductions in VOC and NOx emissions are needed to reduce ozone concentrations in Sydney to levels that would comply with the Air NEPM

The other jurisdictions meet or are close to meeting the current National Environment Protection (Ambient Air Quality) Measure (Air NEPM) ozone standards (NEPC 2005) However the ozone standards are being reviewed and based on current human health evidence the argument appears to be strengthening for tighter ozone standards

2 Presentation to Expert Panel 27 April 2006 by Nick Agipades Manager Major Air Projects NSW DEC

6

Should a stricter standard or an eight-hour standard consistent with international standardsguidelines be adopted achievability of Air NEPM ozone standards or goals could become an issue for some of the other major urban airsheds (NEPC 2005)

Modeling of ozone for Sydneyrsquos Greater Metropolitan Region (GMR) indicates that the implementation of Euro emission limits for on-road vehicles and hence the increased presence of these less polluting vehicles in the fleet and retirement of old more polluting vehicles from the fleet is not sufficient to meet the current NEPM goals Modeling suggests that very large reductions in precursor emissions would be required to meet the current ozone one hour goal (NEPC 2005)

Even when the effects of bushfires and when hazard reduction burning are taken into consideration airsheds such as Launceston Melbourne and Sydney struggle to meet the national standards for particles (EPA 2006) However outdoor powered equipment predominantly from two stroke engines makes only a minor contribution to ambient fine particle loads

While carbon monoxide emissions from engines used in outdoor garden equipment are regulated overseas air monitoring in Australia indicates that carbon monoxides levels are well below the national air quality standards and there are no pressing issues requiring CO from outdoor powered equipment to be regulated In addition data indicates that lowering emissions of VOCs and NOx from small engines reduces CO emissions

Many of the pollutant sources which contribute to the formation of ozone and to particle levels also contain air toxics such as benzene toluene formaldehyde and xylenes These air toxics have been shown to be responsible for a range of health problems including asthma respiratory illnesses and cancer The National Environment Protection Measure for Air Toxics requires each jurisdiction to monitor and report annually on five air toxics benzene polycyclic aromatic hydrocarbons formaldehyde toluene and xylenes The monitoring data is intended to inform future policy and also the public on ambient levels of these air pollutants Monitoring of air toxics to date shows that levels are low and below the national monitoring investigation levels (EPA Vic 2006 DEC 2006)

7

3 Emission Standards for Small Engines

31 Australia

At present there are no Australian regulations or standards to limit air pollutant emissions from small (two and four stroke) engines Australia does benefit to some extent from overseas regulations as many lawnmowers and other gardening equipment sold in Australia have engines manufactured in the United States or Europe where strict standards apply

32 United States

In the United States emission regulations set by the United States Environmental Protection Agency (USEPA) and the Californian Air Resources Board (CARB) apply to lawn mowers and other powered gardening equipment Although CARB standards currently tend to be stricter than USEPA standards by 2006 emissions limits applying under the two standards will be very similar

United States Environment Protection Agency (US EPA)

In 1995 the USEPA introduced ldquoPhase 1rdquo regulations covering small non-road engines with a power of not more than 19kW (25HP) The regulations applied to equipment manufactured from 1997

These regulations have seven classes of equipment based on portability and engine displacement volume (ldquocapacityrdquo) In March 2000 the USEPA published ldquoPhase 2rdquo regulations which are shown in Table 2 These set limits for combined emissions of hydrocarbons (HC) and oxides of nitrogen (NOx) and separate limits for carbon monoxide (CO) emissions and for two stroke engines only particles

Table 2 US EPA Phase 2 Small Engine Emissions Standards (HC+NOx in gkW-hr) (a) (b)

Small Engine Class

Type 2002 2003 2004 2005 2006 2007+

I-A (lt66cc) Non-handheld (eg lawnmowers)

- 161 161 161 161 161

I-B (66 to lt 100cc) - 161 161 161 161 161

I (100 to lt 225cc) - 161 161 161 161 161

II (225cc or more) 180 166 150 136 121 121

III (lt20cc) Handheld (eg trimmers)

238 175 113 50 50 50

IV (20 to lt50cc) 196 148 99 50 50 50

V (50cc or more) - - 143 119 96 72 (a) As carbon monoxide (CO) levels in Australia are well below the Air NEPM standard the

USEPA emission limits for CO have not been included in this table (b) Includes useful life criteria of 50125300 hours

8

When the USEPA introduced ldquoPhase 2rdquo regulations it included averaging banking and trading provisions (ABT) which were seen ldquoas an important element in making stringent Phase 2 emissions standards achievable with regard to technological feasibility lead time and costrdquo (USA 1999) The USEPA also claimed (USA 2000) that the ABT program secures early emissions benefits through the early introduction of cleaner engines

ABT provisions which apply to handheld and non handheld engines are complex but in broad terms averaging means the exchange of emission credits among engine families within a given engine manufacturerrsquos product line This allows a manufacturer to produce some engines that exceed the standards and offsetting these exceedances with emissions from engines that are below the standard Manufacturers are allowed to exchange credits from handheld to non handheld and vice versa Banking means the retention of emission credits by the engine manufacturer generating the credits for use in a future model year (for averaging or trading) Trading is the exchange of emission credits between engine manufacturers which then can be used for averaging purposes banked for future use or traded to another engine manufacturer

In January 2004 USEPA reported that in 2002 averaging was being used but there was very little use of banking It determined that the initial ABT programs as too complex and included discount rates on credits ABT was simplified in 2004 including the elimination of credit discount and multipliers and limits on credit life To date there has reportedly been limited use of banking however it is anticipated that there will be more widespread use of banking credits if the USEPA proposed Phase 3 comes into effect3 (see below)

Particulate limits (2gkW-hr) also apply to two stroke engines Carbon monoxide and durability limits (or useful life) are also prescribed The durability criteria which were introduced in Phase 2 require that the emission limits must be met through the useful life of the engine The manufacturer determines useful life of each product using standardised product testing procedures and then based on the test results selects the useful life category for each product which can be 125 250 or 500 hours These durability criteria acknowledge the large disparity in usage patterns by equipment type and between commercial and residential users It also takes into account the ability of manufacturers to design and build engines for various design lives and which fit the types of equipment engine is produced for

The March 2000 USEPA report (USEPA 2000) estimated that the expected effects of the Phase 2 regulations would be

bull A 70 reduction in HC+NOx beyond the Phase I standards (which were estimated to have reduced emissions by 32 from the unregulated baseline)

bull A 30 reduction in fuel consumption of small handheld equipment bull Price increases of between $US23 (Class III) and $US56 (Class V) for

handheld equipment

3 Dave Gardner Briggs and Stratton email 22506

9

The US EPA is currently considering lsquoPhase 3rsquo regulations which are catalyst based standards to further reduce exhaust HC and NOx emissions from non handheld engines reduce evaporative HC and NOx emissions for both handheld and non handheld engines plus include extended durability criteria These limits are currently at discussion stage only They align with CARB Tier 3 but a longer lead time is proposed

Table 3 Proposed Phase 3 Exhaust Emissions

HC+NOx gkW-hr

CO gkW-hr

Year Useful life hrs

Class I 100 610 2010 125250500

Class II 80 610 2011 2505001000

Class III-V No changes

HC+NOx std is based on averaging

Californian Air Resources Board (CARB)

Spark ignition engines

CARB regulations first introduced emission limits for small engines manufactured from1995 The more recent schedule of emission limits are shown in Table 4 These limits depend solely on the engine capacity and apply to both handheld and non handheld classes

Table 4 CARB Emission Limits for Small Engines (HC+NOx in gkw-hr)

Engine Capacity 2000-2001 2002-2005 2006+

65cc or less 72 72 72

gt65cc to 225cc 161 161 161

gt225cc 134 121 121

California has particle limits for two strokes useful life criteria and mandatory engine labeling including a consumer advisory hang tag as shown in Figure 1 The USEPA is also considering introducing an air index label

10

Figure 1 Example of a Californian Consumer Advisory Hang Tag The Californian regulations take into account sales weighted emission performance for families of engines An engine family is essentially the same engine being used in different equipment items

In 2003 California adopted a Tier 3 program for exhaust and evaporative emissions and these are based on the use of catalytic convertors The engine classes better align with US EPA categories however the exhaust standards for Class I and Class II are more stringent than the existing US EPA standards

Table 5 CARB Tier 3 for Exhaust Emissions

Model Year Displacement Category

Durability Periods (hours)

HC+NOx gkw-hr

CO gkw-hr

Particulate gkw-hr

2005 and subsequent

lt50 cc 50125300 50 536 20 + 50-80 cc inclusive 50125300 72 536 20 +

2005 gt80 cc - lt225 cc Horizontal-shaft eng

125250500 161 549

gt80 cc - lt225 cc NA 161 467 Vertical-shaft Engine 225 cc 125250500 121 549

2006 gt80 cc - lt225 cc 125250500 161 549 225 cc 125250500 121 549

2007 gt80 cc - lt225 cc 125250500 100 549 225 cc 125250500 121 549

2008 and subsequent

gt80 cc - lt225 cc 125250500 100 549 225 cc 1252505001000 80 549

the 1000 hours is applicable for 2008+ Model Year (MY) + applies to 2 stroke only Source California Exhaust Emission Standards and Test Procedures For 2005 And Later Small Off-Road Engines Adopted July 26 2004 effective on October 20 2004

California also has Blue Sky provisions These are voluntary standards for engines that meet the criteria shown in Table 6 Blue Sky Series engines are not included in

11

the averaging banking and trading program Zero-emission small off-road equipment (eg push mowers) may certify to the Blue Sky Series emission standards

In 2005 CARB aligned its test procedures with the USEPA

Table 6 CARB Blue Sky Provisions

Model Year Displacement Category

HC+NOx gkw-hr

CO gkw-hr

Particulate

2005 and subsequent lt50 cc 25 536 20

50 - 80 cc inclusive 36 536 20

2007 and subsequent gt80 cc - lt225 cc 50 549

2008 and subsequent 225 cc 40 549 Applicable to all two stroke engines

33 Canada

The Canadian small engine market has similarities to the Australia market the majority of small engines are imported from the USA and there is one Canadian manufacturer of small spark ignition engines and one major manufacturer of lawn and garden machines

A Memorandum of Understanding (MOU) which came into effect on 1 January 2000 was signed between Environment Canada and ten manufacturers of handheld equipment and nine manufacturers of engines used in non handheld machines The MOU was intended as an interim measure until regulations could be put in place Under the MOU the manufacturers agreed to voluntarily supply small spark ignition engines designed to meet the applicable USEPA Phase 1 emission standards

In 2003 Canada regulated emission limits for handheld and non-handheld small engines based on USEPA emission limits The regulations apply to model years 2005 and later While there are no separate averaging banking and trading provisions in Canadian regulations Canada allows any USEPA certified engine to be sold in Canada This means that engines that do not meet the standard level but are averaged (or use credits) in the United States can be sold in Canada Manufacturers are required to produce upon request evidence of conformity to the standards and are required to provide written instructions on engine maintenance to the first retailer

12

Table 7 Canadian Small Spark-Ignition Engine Exhaust Emission Standards

Engine class

Engine Type

Engine Displacement (cm3)

Effective date (model year)

Standard HC+NOx (gkWshyhr)

Standard NMHC+NOx (gkW-hr)

Standard CO (gkWshyhr)

I-A Non-handheld lt66 2005 and

later 50a -shy 610a

I-B Non-handheld

lt100 and 66

2005 and later

40a 37a 610a

I Non-handheld

lt225 and 100

2005r 161b 148a 519b 610a

II Non-handheld 225 2005 and

later 121a 113a 610a

III Handheld 20 2005 and later 50a -shy 805a

IV Handheld lt50 and 20 2005 and later

50a -shy 805a

V Handheld 50 2005 2006 2007 and later

119a 96a

72a

-shy-shy

-shy

603a 603a

603a a Standards apply throughout the engine useful life b Standards apply only when the engine is new Source Canada Gazette Part II Vol 137 No 24 2003-11-19

34 Europe

In 1998 the European Union introduced exhaust emission limits for small petrol engines through Directive 9768EC and in 2002 introduced amendments through Directive 200288EC The limits in the Directives align with the US regulations however they do not have averaging and banking provisions

Table 8 European Emissions Standards

Small Engine Class Type (HC+NOx in gkW-hr) 2004 2005 2006 2007 2008

SN1 (lt66cc) Non-handheld (eg lawn mowers)

161 161 161 161 161

SN2 (66 to lt 100cc) 161 161 161 161 161

SN3 (100 to lt 225cc) - - - 161 161

SN4 (225cc or more) - - 121 121 121

SH1 (lt20cc) Handheld (eg trimmers)

- - - 50 50

SH2 (20 to lt50cc) - - - 50 50

SH3 (50cc or more) - - - - 72

13

The European Union is currently considering including useful life criteria and averaging and banking provisions plus it is considering introducing a Directive to further reduce emissions from diesel engines The objective of the proposal is to tighten emissions standards for engines in general non-road applications in light of technological developments and it taking into account the parallel developments for similar legislation in the United States in order to harmonise the environmental standards and to facilitate trade

Charts comparing the USA Californian and European Emission Limits are shown below

14

35 Summary of Regulations for Non Handheld Equipment

KEY TO CHARTS

USEPA CARB EU

0

10

20

30

40

50

60

70

80

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

0 to 49cc

0

10

20

30

40

50

60

70

80

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

50 to 65cc

0

2

4

6

8

10

12

14

16

18

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

100 to 224cc

0

2

4

6

8

10

12

14

16

18

20

2000

2002

2004

2006

2008

Year Model

HC

+N

Ox g

kW

-hr

225cc and over (up to 19kW)

15

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

36 Summary of Regulations for Handheld Equipment

KEY TO CHARTS

USEPA CARB EU

20 to 49cc 0 to 19cc

250 250

200

150

HC

+N

Ox g

kW

-hr

100

200

HC

+N

Ox g

kW

-hr

150

100

50 50

0 0

Year Model Year Model

50 to 65cc 66 to 80cc

160

160

140

140

120

40 40

20 20

0 0

120

HC

+N

Ox g

kW

-hr

HC

+N

Ox g

kW

-hr

100100

8080

60 60

Year Model Year Model

16

Summary of Regulations for Handheld Equipment (continued)

KEY TO CHARTS

USEPA CARB EU

0

20

40

60

80

100

120

140

160

2000

2001

2002

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

81 to 224cc

0

20

40

60

80

100

120

140

160

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

225cc and over (up to 19kW)

17

4 Australian Market for Small Engines

41 Likely compliance with overseas emissions standards

As part of this assessment an environmental profile of equipment currently on the Australian market has been developed initially based on information from manufacturersrsquo brochures and web sites and industry magazines and then confirmed through follow-up with relevant industry contacts

Each item of equipment has been assessed on its compliance with USEPA CARB or European regulations In most cases it was not possible to match models available on the Australian market with CARB lists (CARB publishes exhaust emissions data on all appliances on its web site) This was mainly due to the inconsistency of model designations and uncertainty about ldquoengine familiesrdquo

Engine characteristics and retail price were difficult to obtain Some brochures also made claims of compliance with USEPA European or CARB requirements The detailed breakdown of current equipment on the Australian market is given in Appendix 1

The majority of small engines sold in Australia are imported and many come from countries that impose emission limits The extent of imports into Australia that do not comply with the country of origin standards is not known Industry estimates that 40 of garden products are sold through importers who are not linked to manufacturers of US EPA or European certified equipment and the source of some products sold here is difficult to establish Victa is the only company producing small engines in Australia Its iconic 2-stroke lawnmower currently cannot meet overseas emission limits

Outdoor Power Equipment Association (OPEA) assisted in identifying the Australian distributors of most brands of powered garden equipment In April 2006 a survey form was sent to a total of 43 distributors representing 97 brands of equipment The survey form sought information about the engine for all petrol-fuelled garden equipment with a power not more than 19kW

Figure 2 Extract from survey form

18

Initial response to the survey was poor Despite follow-up action and efforts from the industry association at the beginning of September 2006 26 distributors had responded to the survey information and only 13 distributors provided all data necessary for benchmarking purposes This resulted in emission compliance data for about half of the estimated products on the Australian market Attempts to match Australian models with the database maintained by the Californian Air Resources Board were also of limited success due to inconsistencies in model designations between Australia and the USA and the manner in which model information is coded in the CARB database

Table 9 Summary of distributor responses

Responses status Not OPEA OPEA ALL

Number of responses 9 8 (31) 17 (40)

Response - all data 4 9 13 (30)

Response - extra time sought 3 3 (7)

Response - no petrol products 4 1 5 (12)

Response - some data 5 5 (12)

Grand Total 17 26 43 percentages may not add to 100 due to rounding

Of the 97 brands initially identified

bull 16 brands are apparently no longer sold in Australia

bull No responses were received for 29 brands

bull Partial data were received for 12 brands

bull All data was available for 30 brands

Table 10 Summary of responses by brand

Count of brands

Analysis status Not OPEA OPEA All

Missing some data 12 12

No data received 9 (27) 20 (31) 29 (30)

No longer sold 13 3 16

Response - no models to list 3 7 10

Response received (electronic form) 5 11 16

Response received (paper form) 3 2 5

Response received (spreadsheet) 9 9

All 33 64 97

A 2004 report for the NSW DEC estimated that there were about 1200 eligible garden

19

products in the Australian market The current project has obtained data for a total of 870 products or 72 of the estimated population In addition the sampling method is likely to be biased towards products with good environmental performance In these circumstances the following analysis should be regarded as indicative only

Survey results

The following tables and figures show expected compliance with European CARB or USEPA requirements based on the limited information provided by industry

Table 11 Engine type and compliance with overseas standards Count of products Engine type

Best STD 2c 4c Unknown All 1997 - US EPA I 53 32 85 (10) 200288EU 17 17 (2) 2004 - US EPA II 1 3 4 (lt1) 2004 EURO I 8 8 (1) 2005 - US EPA II 10 29 5 44 (5) 2006 - US EPA II 107 141 2 250 (29) 2006 EURO I 6 6 (1) 2007 - US EPA II 1 1 (lt1) 2007 Euro II 2 2 (lt1) None 118 90 208 (24 Unspecified 24 60 161 245 (28) All 344 358 168 870

Unknown means the type of engine is unknown (but is most likely to be 2c) Unspecified means that the status of emissions compliance was unable to be identified None means the manufacturerdistributor has indicated that the equipment does not comply with any overseas emissions standard

Figure 3 Compliance with overseas standards - all surveyed products Note Unknown in chart includes unspecified and unknown from Table 11

20

Figure 4 Compliance with overseas standards by equipment type ldquoPhase 1 equivrdquo means the engine complies with US EPA phase 1 or 200288EU ldquoPhase 2 equivrdquo means the engine complies with US EPA Phase 2 Euro I or Euro 2 ldquoUnknown means that engine cycle (stroke) was not provided

Of the 41 categories of equipment in the survey 15 had at least 10 current products Results for these categories are set out below

Figure 5 Engine type for popular categories

21

Figure 6 Compliance with overseas standards for popular categories ldquoPhase 1 equiv means the engine complies with US EPA phase 1 or 200288EU Phase 2 equiv means the engine complies with US EPA Phase 2 Euro I or Euro 2 ldquoUnknown means that engine cycle (stroke) was not provided

42 Australian Sales of Outdoor Powered Equipment

The Australian Outdoor Power Equipment Association (OPEA) whose membership represents about 80 of the manufacturersdistributors and dealers in the industry commissions regular independent industry audits of garden equipment sales (OPEA personal communications) Sales data from OPEA is shown in Table 12

22

Table 12 Sales of outdoor garden equipment 2002 and 2005-06 2005-06 2 stroke (1000)

2002 2 stroke (1000)

2005-06 4 stroke (1000)

2002 4 stroke (1000)

2005-06 TOTAL (1000)

2002 TOTAL (1000)

Walk behind mowers 72 170 351 76 424 246

Brushcuttertrimmer 321 12 17 180 339 192

Chainsaws 152 0 0 90 152 90

Chipper shredders 0 60 46 0 46 60

Blowerblower vacuums 98 0 11 50 109 50

Ride on mowers 0 25 51 0 51 25

Generators 11 32 96 0 107 32

Hedge trimmers ampothers 40 192 0 28 40 220

694 491 476 424 1267 915

for total sales 593 463 407 537

for mowers 152 280 848 720

According to OPEA approximately 424000 walk behind lawnmowers and more than 792000 units of outdoor handheld equipment were sold in Australia in 2005-06 In addition there were sales of about 80000 replacement engines and 70000 pumps in 2005-06 most of which were four strokes These figures show that there has been considerable growth in the sales of most products with the exception of chipper shredders and the category lsquohedge trimmers and othersrsquo whose sales declined in 2005shy06 compared with those in 2002 About 17 of walk behind lawnmowers were two stroke and 83 four stroke which is an improvement in the uptake of cleaner engines when compared to 2002 when about 30 were two stroke The situation with handheld equipment is reverse with nearly 79 being two strokes compared to 47 in 2002 However many models of two stroke handheld equipment meet current US emission standards and care should be exercised in using engine type (two stroke or four stroke) as an indicator of emissions performance for this class of equipment

The OPEA 2005-06 sales estimates are shown in Figure 7 OPEA cautions that there is considerable uncertainty about the estimates for brushcutters and blowerblower vacuums as OPEArsquos figures only represent 50 and 60 respectively of sales of these products No estimates of future sales trends were identified during research for this project

23

Australian sales of 2 and 4 stroke outdoor equipment 2005-6

0 50 100 150 200 250 300 350 400

Walk behind mowers

Brushcuttertrimmer

Chainsaws

Chipper shredders

Blowerblower vacuums

Ride on mowers

Generators

Other

Annual sales (x 1000)

4s 2s

Figure 7 OPEA estimates of equipment sales in 2005-06 Note Blowervac is an industry term for equipment that combines blowing and vacuuming functions

Briggs and Stratton (Australia) who import engines from the USA supply the majority of the four stroke engines for handheld equipment sold in Australia and these comply with all the current USA and CARB regulations Imported handheld garden equipment is shipped fully assembled to a branch or distributor and is then sent to a retailer The retailer may or may not provide equipment servicing

OPEA members have expressed concern regarding the increasing sales of imported high polluting two stroke engines that allegedly do not meet any emission standards and come from countries that do not have emission standards One industry representative reported that some of the imported trimmers were being manufactured in China using outdated designs and tooling from two old bankrupt American companies and these are being sold here at about 30 of the price of traditional brands and very low cost generators from China now account for around 70 of total sales It is difficult to confirm this trend without undertaking a detailed examination of Australian import data however the significant increase in the sales of two stroke handheld equipment provides some support for this trend

On the other hand it is claimed by industry that the ride on mower market (predominately with compliant four stroke engines) has been stimulated by the Australian USA free trade agreement

24

5 Australian Users of Small Engines This section examines the market segments for garden equipment and customer purchasing behaviour

51 General Public

Purchasing behaviour

Research into consumer purchasing behaviour has found that consumers assess a product against a range of attributes for example price weight brand reputation servicing and parts availability warrantees and guarantees experience size promotions and discounts Studies have also revealed that up to 82 of Australians had bought products on the basis of social or environmental factors in the previous year (State Chamber of Commerce 2001) Related to this point the energy star rating ecolabel on whitegoods was viewed as a credible environmental claims system which is well regarded by the general consumer (Product Category Manager Mitre 10 personal communications)

As the purchase of small engine garden equipment by the general consumer is an infrequent purchase which carries a certain of amount of risk With small engines the risk can be functional risk (will not perform as expected) physical risk (for example safe features such automatic cut out on an electric lawn mower) or financial risk especially for the more expensive items The general consumer is likely to lessen the risk by seeking information and by evaluating the information on the available products over a period of time The consumer may also lessen the risk by

bull purchasing well known brands

bull buying the brand offering the best warrantees and guarantees

bull buying the most expensive brand and

bull buying a brand they have used before

Research indicates that the desired attributes of a product may not be well established at the start of a consumerrsquos search process but will often be refined as the consumer learns more about the product The consumer will also use a ranking and weighting process based on desired qualities and trade offs may be made

Reportedly purchases of engine operated garden equipment are based on price yard size fitness for purpose and other features such as weight and ease of starting (Product Category Manager Mitre 10 personal communications) Males are the predominant purchasers of garden equipment however because of changing demographics there has been an increase in the number of women purchasing these products

Less than 5 of lawnmowers purchased are push or electric mowers (Product Category Manager Mitre 10 and industry sources personal communications 2003)

25

Electric mowers are generally perceived as not being as effective as cords have limited range and rechargeable electric mowers require frequent recharging

There is a recent trend towards ride on mowers (all four strokes) probably because of changing demographics specifically older age groups moving to more rural environments with larger yards (OPEA personal communications)

A study (Wilkie 1994) investigated consumer appliance purchasing behaviour and found that the general consumer consulted a range of information sources before purchasing an appliance The appliance salesperson was found to be the most important information source for many consumers Other important information sources include newspaper advertisements friends and relatives catalogues consumer reports and brochureslabels Since Wilkiersquos study the internet will have become increasingly important as a research tool and in some instances as a way to purchase products As part of this study there is evidence of low priced products being sold into the Australian market via the internet only ndash a practice that is likely to increase in the future It was difficult to source any compliance or details on these products

At the retail chain level staff product training is generally voluntary undertaken out of store hours and as an inducement to attend training sessions suppliers usually provide incentives for staff Retail chain purchases are very price driven although some chains are reportedly interested in stocking goods that have credible environmental claims (Mitre 10 and other retail chain sources)

IBIS (2006a) reports that the domestic hardware sector which is dominated by Danks (Home Timber and Hardware Thrifty - Link Hardware and Plants Plus Garden Centre) and Bunnings is classified as a growth market and the sales of lawnmowers and other lawn and garden machinery and equipment represent about 14 of sales revenue

In summary it appears that a range of product attributes influences consumer purchases of lawnmowers and outdoor equipment Currently there is very little information about emissions in any of the information sources a consumer is likely to consult when purchasing these products Nevertheless surveys indicate that consumers are concerned about the environment and are open to including environmental considerations into their purchase decision Educating sales staff about the air emissions from lawnmowers and outdoor equipment together with ecolabels could therefore be important methods for influencing consumers towards the purchase of cleaner products

Equipment Usage

The USA Outdoor Power Equipment Institute CARB (cited in USEPA 1998) and the USEPA (USEPA 1998) have made estimates of annual usage rates and average life spans of outdoor equipment for the general consumer user and for the commercial user Table 13 gives USA usage and lifespan range for selected items of powered equipment

26

Table 13 USA Average Usage and Lifespan of Outdoor Garden Equipment For General Consumers and Commercial Users Equipment Annual usage (Hours) Lifespan (years)

General Consumer

Walk- behind mowers 20-25 6 -7

Rear engine ride on mowers 4 6 -7

Chainsaws 7 5-9

Leaf blowers 9-12 5-9

Trimmers 10 5-9

Commercial User

Walk- behind mowers 320 27

Rear engine ride on mowers 380 38

Chainsaws 405 1-13

Leaf blowers 170-293 18-28

Trimmers 170 - 275 15-28

Discussions with members of the Australian industry confirm that Australian hours of use are likely to be similar to the American estimates although this can vary depending on location For example in tropical areas lawns are mowed more often because they grow faster in this climate The American turnover of equipment is however probably higher than here as the Australian consumer tends to keep their equipment longer and so the useful life of a mower is more likely to be on average 10 ndash12 years

52 Garden and Ground Maintenance Services

According to a recent IBIS report (2006b) the revenue for this industry in 2005-06 was $383 million and the industry outlook is lsquobrightrsquo with a predicted annual average 5 growth over the next few years The Australian customer base for garden maintenance services including for lawn mowing is

Households 55 Business 25 Government 20

The sector is reportedly a growth industry due to

bull the aging population

bull the increasing numbers of households that are time poor income rich and

bull the growing trend for professional landscaping which requires a higher level of garden maintenance

27

The main customer base for these businesses includes middle to upper socioeconomic groups the aged and people who are physically disabled Growth is predicted particularly for the franchise industry with demand from the commercialindustrialgovernment sectors (IBIS 2003) A 1999 ABS survey reported that nearly one-third of older people purchased at least one domestic service per fortnight with gardening assistance being the most common This accords with an industry estimate that about 25 of householders pay someone to mow their lawn (Jim Penman Jimrsquos Mowing personal communication) The industry is sensitive to economic conditions and weather for example the drought has slowed growth over the last few years

The garden maintenance sector is dominated by small independent operators with two major franchisers Jimrsquos Mowing and VIP VIP nationally has 600 franchises and Jimrsquos Mowing about 400 Jimrsquos Mowing reportedly mows about 15000 lawns and has 53 of the market (IBIS 2006b) As franchised lawn mowing services represents about 14 of the lawn mowing services nationally it can be estimated that approximately 280000 lawns are mowed nationally by commercial operators

Jimrsquos Mowing and VIP provide training and advice to new franchisees on equipment including proper maintenance schedules Training generally occurs before franchisees purchase their equipment Most franchisees equipment would consist of two mowers a brushcutter an air blower and possibly a hedge trimmer or chain saw Operators prefer four stroke mowers and these are used for an average eight hours per week Brushcutters are generally two strokes as are other motors (IBIS 2006b and Jim Penman personal communication)

From the above it is estimated commercial operators operate mowers for up 34 million hours per year (or 8 of the total estimated mowing hours per year) and purchase approximately 66000 lawnmowers annually (25 of purchases) The sectorrsquos purchases of brushcutters is estimated to be approximately 8000 units per year or 37 of purchases Table 13 provides US commercial userrsquos annual average hours of use and average equipment life spans ndash it would be anticipated Australian rates would be similar

The main businesses contracting to provide ground maintenance services to the corporate and government sector (including universities) are Spotlessrsquos Open Space Management Transfield and Programmed Maintenance Services all of which are diversified publicly listed companies plus the Danish owned company ISS (previously Tempo Services) (IBIS 2003 and 2006b and company websites) The type of services they provide means it is likely they would have an array of equipment and a preference for the more powerful ride-on mowers and for Class V handheld equipment

53 Government Purchasing

The way purchasing decisions are made by government or other large organizations is generally very different to the approach taken by the general household consumer

bull many of the purchases are for large quantities of goods

28

bull there are well established policies and procedures in place to guide purchasing with the purchase criteria established early in the buying process and

bull those making the purchase are likely to be more knowledgeable about the product than the average consumer and they are usually not the eventual user of the goods

Value for money fitness for purpose ability to supply and over recent years environmental aspects are likely to be important factors in the purchasing decision for Government

Local State and Commonwealth Governments have responsibility for the upkeep of public assets many of which include public open space and other outdoors areas At the State and Federal level these include schools universities sporting facilities hospitals and defence facilities These services may be outsourced individual departments may undertake maintenance and purchase their own equipment or they may purchase equipment through a central purchasing facility With the central purchasing facility these items are generally purchased under contract While there is an increase in the inclusion of environmental considerations in the selection criteria for purchasing goods and services especially under contract these considerations mainly relate to waste management and recycling criteria and not air emissions

Local councils in some states for example NSW generally take responsibility for ground maintenance within their council areas or for some smaller councils the service may be contracted to a neighbouring council In other states such as Victoria there is a trend to outsource ground maintenance contracts to commercial providers

It is unknown what proportion of total sales that direct Government purchases represent however it likely to represent a relatively small share of several percent of the overall market

In summary

bull The general household consumer represents the major market segment for garden equipment accounting for up to 90 of product sales

bull Government is likely to be relatively small direct purchaser of garden equipment

bull Commercial garden services to households purchase approximately 25 of lawnmowers per year and 37 of brushcutters

bull Large ground maintenance companies are likely to prefer larger and more powerful equipment such as ride-on mowers

29

6 Result of Stakeholder Consultation

61 Regulations

The Small Engine Expert Panel ndash Outdoor Equipment considered in depth an approach to take to improve the emissions performance of outdoor garden equipment sold in Australia Discussions were particularly focused on the growing influence of cheap high emissions imported products together with the difficulties that the local manufacturer of lawn mowers is likely to face in complying with the relevant overseas standards As part of this process the industry representatives on the Panel held additional discussions and they consulted international industry experts at the manufacturing level in Europe the USA and Japan

OPEArsquos preference is for the adoption of regulations based on the USEPA standards with Phase 1 being adopted possibly from as early as 2007-08 The industry then proposes that Phase 2 be introduced in 2012 Phase 1 USA EPA standards were adopted in the USA in 1995 to be applied to equipment manufactured from 1997 and Phase 2 standards were introduced in 2002 through to 2007 and these included averaging banking and trading provisions A comparison between the USA Phase 1 and Phase2 standards is given in Table 14 The USEPA is discussing Phase 3 limits for the adoption in 20102011 which includes tighter exhaust emission limits for non-handheld equipment

The emissions limit of the two stroke lawn mower manufactured by the sole Australian manufacturer are well above USA Phase 1 limit for non-handheld equipment One avenue to address this issue which was supported by the Expert Panel ndash Outdoor Equipment would be to place lawn mowers in the US EPA Category 5 (engines gt50cc) This would result in emissions for two stroke lawnmowers being limited to 161 gkW-hour HC + NOx compared to the USA regulated limit of 161 gkW-hour HC + NOx Doing this would align the ramp-up timetable for mowers with that of other garden products

Table 14 Comparison between the USA Phase 1 and Phase 2 standards

Emission Limits GkW-hr

Phase 1 (1997 ndash2001) Phase 2 (2007) HC NOx HC+NOx CO HC+NOx CO

Non-handheld I-A lt66cc 161 610 I-B 66-lt100cc 161 610 I 100-225 cm3 161 519 161 610 II 225 cm3 134 519 121 610 Handheld III lt20 cm3 295 536 805 50 805 IV 20-50 cm3 241 536 805 50 805 V 50 cm3 161 536 603 72 603

Phase 2 limits were phased in between 2002 -2007 during which time they became tighter for simplicity only the 2007 are shown in this table (see Table 2 for more details)

30

In addition to limiting emissions the Expert Panel support the inclusion of the durability criteria which apply in the USA under Phase 2 standards and certification documentation from either the USA or Europe as adequate proof of conformity Equipment that has not been tested and certified to USA or European standards will be required to have the engines tested in a NATA certified laboratory

Some in the industry argued that regulations should include provisions for averaging for companies that wish to use it however they felt banking and trading provisions would not be necessary Industry representatives were not supportive of any Australian consumer labeling requirement instead OPEA members are willing to supply emissions data for inclusion in a web-based database that would allow purchasers to assess the environmental credentials of different makes and models

62 Discussion on recommended regulations

Timing of introduction

Some industry representatives argue that introduction of Phase 1 standards in 2007-08 will not give the industry an adequate transition period in which to develop competence in emissions certification establish new procedures and tooling in the dealers workshops train dealers and technicians on legal requirements distribute specific tooling and spare parts and reduce stocks of old (non certified) products without incurring an undue financial burden While others in the industry prefer progressing straight to phase 2 standards

If the OPEA preference for the adoption of the United States Phase 1 regulations which operated in the USA between 1995 and 2001 were introduced in Australia in 2007-08 they would be well behind the USA standards and worldrsquos best practice Furthermore the introduction of the United States Phase 2 - 2007 limits in Australia in 2012 would if the USEPA introduce Phase 3 in 2010-11 see emission limits for lawnmowers and other non handheld garden equipment in Australia still lagging United States standards and worldrsquos best practice

To introduce regulations in 2007-08 will require Government firstly to determine the most appropriate mechanism under which to enact the regulations draft the regulations prepare the regulatory impact assessment consult with the broader community and then finalise the regulations It is likely an Act of Parliament will be required at the Commonwealth level followed by complementary legislation at the State and Territory level It is possible for this to be achieved in less than a two year timeframe (as was the case for the Water Efficiency Labelling Scheme) However regulations that do not have a level of perceived urgency would take longer The level of importance and urgency to control emissions from small engines has yet to be debated and determined

31

Modified USEPA limits for lawnmowers

From the 183 lawn mowers identified through the market survey Victa is the main (possibly sole) provider of two stroke mowers with the other lawnmowers having cleaner four stroke engines

Victa is undertaking work to produce a cleaner product Victa estimates it would need a number of years to complete development production tooling and commercialisation of the cleaner engines In January 2007 it released a new two stroke carburettor lawnmower that has reduced engine emissions by more 30 but the combined HC and NOx emissions are still above USEPA Phase 1 limits Victa says this new engine is the outcome of four years of collaborative work by Victa and the University of Technology Sydney Victa is continuing with this research to further reduce emissions

A clause that allows exemptions to be granted as occurs in other countries could be included in the regulations however Victa argues that this would create uncertain trading conditions for the company for a period of time until an exemption were granted

Placing lawn mowers in the US EPA Category 5 (engines gt50cc) has the risk of opening the Australian market to more two stroke lawn mowers which has the greatest use of any outdoor powered equipment however it should see the continuance of the sole engine being manufactured in Australia In 1995 when it was introducing small engine emission limits the USEPA faced a similar issue with two stroke lawn mowers and used a similar approach by allowing two stroke lawn mowers to comply with the handheld standards It also specified that the number of two stroke lawnmower engines allowed to meet handheld standards would be subject to a declining annual production cap with the allowance provided by the production cap being phased out in 2003 There is also similar precedent for small engine emission limits that depend on engine type - European regulations for marine outboard motors set less stringent requirements for two stroke motors

Averaging Banking and Trading Provisions

The US EPA did not have averaging banking and trading provisions in Phase 1 and therefore all small outdoor engines were required to meet the Phase 1 limits It only introduced ABT provisions in the much more stringent Phase 2 as they would allow the most economic introduction of cleaner engines The industry claims the systems to use this provision are available and can be implemented in Australia by those who wish to use it at little cost to government

Industry claim that any supportive economic data related to averaging is sensitive and confidential It is there difficult without substantial justification by the industry to support the provision for averaging in conjunction with Phase 1 particularly given the elapsed time between the introduction of Phase 1 in the USA and their recommended introduction in Australia If there are some low volume equipment items that still cannot meet the USAEPA Phase 1 standards then these could be subjected to

32

exemptions if adequate justification can be provided (exemptions for small volumes were available under the USEPA regulations)

It was noted that for government to implement regulations a regulatory impact statement is required and this requires an assessment of the costs and benefits of the options considered with clear overall benefits shown for the preferred option Therefore if the option for manufacturers to use averaging were to be considered more information to support its inclusion would be required

Other options that could be considered to circumvent the inclusion of averaging include

i including clauses that give manufacturers the ability to apply for exemptions from the regulations for classes of equipment that have small sales volumes (these provisions are available in the USA)

ii limiting the regulation to popular types of equipment

iii using the end-of-model life provisions that have been used in the Australian Design Rules for cars In effect the end of model life provisions require new designs to comply from the implementation date but allow older models to remain on sale for a few more years This is an alternative to ABT because it facilitates earlier introduction of the regulation

iv Having a phase in period of say 2 years during which existing models can continue to be sold but new models coming on to the market must comply with the new standards At the end of the phase-in period all models must comply with the new standards This is an approach that is used when Australian Design Rules (ADRs) are introduced for motor vehicles

Consumer Information

Current Australian directions to reduce the environmental impact of consumer products favor tiered benchmarks using a lsquostarrsquo rating system (see Appendix 3 for examples such as the Mandatory Energy Efficiency Label and the Water Efficiency Labelling Scheme)

As products generally arrive in Australia assembled and packaged industry considers a mandatory requirement to label products with an Australian style star rating would impose a cost on distributors that would drive up the retail price of products Instead the OPEA members were willing to supply emissions data for inclusion in a web-based database that would allow purchasers to assess the environmental credentials of different makes and models Given the diverse nature of the industry it is unlikely a database would provide complete coverage of all products on the Australian market but inclusion in the database would indicate that the manufacturer has a commitment to environmental performance It was acknowledged in discussions that at least some Phase 2 compliant products would become available prior to 2012 and the web-based database would provide one method to promote those cleaner engines

33

In summary the Recommendations of the Expert Panel

1 Mandatory air pollutant emission standards to be introduced in Australia for all outdoor equipment (lt19kW) powered by spark-ignition engines The development of any regulation would need to be based on a formal assessment of the costs and benefits of nationally regulating 2 and 4 stroke lawn mowers and handheld power equipment which should be commenced immediately

2 Proposed standards to mirror US EPA regulations (compliance with equivalent EU regulations also acceptable)

3 Timing (subject to completion of assessment of costs and benefits)

(a) US EPA Phase 1 ndash Effective from 2007 2008

(b) US EPA Phase 2 ndash Fully implemented in 2012 (in step with 2007 USEPA limits) with phase-in period andor ABT over 2008-2012 to provide for early introduction of cleaner product

4 Walk-behind 2 stroke mowers to be included in US EPA Category 5 (gt50cc) product classifications Implementation timing to be as in Recommendation 3 above

5 All products also to be certified to relevant EPA durability categories

6 Subject to further review ABT (if included) may be phased out after 2012

34

7 The Way Forward

The optimum approach for garden equipment out engine emissions of options needs to be sustainable and cost effective This will need to be determined through a costs and benefits analysis (CBA) CBA assigns monetary values and typically assesses the impacts on the consumer on human health on the environment on industry and on government A detailed costs and benefits analysis is beyond the scope of this report however the following sections draws on available information to provide some indication of the possible costs and benefits that are associated with emissions from garden equipment engines

Air Quality Benefits

Environment Canada estimated the introduction of the regulations would result in a 44 percent reduction in combined HC+NOx emissions from small engines used in garden equipment and reduction in individual air pollutants over a 25 year period as shown in Table 15 The Canadian estimates incorporate the benefits that would accrue from the MOU signed with the industry in 2000 plus the benefits from the regulations introduced in 2003 In 2000 Canada imported around 13 million small spark-ignition engines and machines (ie a similar number to Australia) with 80 supplied by the USA

Table 15 Canadian Small Spark-Ignition Engine Emissions in Year 2025

Substance Base Case Emissions in 2025

Emissions in 2025 with Regulations

Percentage Reduction in 2025 (Regulations vs Base Case)

Criteria Air Contaminants (kilotonnes)

HC 772 410 469

NOx a 84 67 201

CO 1413 1403 07

Greenhouse Gas (kilotonnes)

CO2 2903 2645 89 Base case year 2000 (accommodating voluntary agreement) Source Canada Gazette Part II Vol 137 No 24 2003-11-19

Other Environmental Costs and Benefits

In addition to the human health benefits associated with reduced exposure to ozone there is a range of other public benefits including reduced damage to vegetation and therefore higher crop yields less damage to materials and structures particularly

35

some rubber products and improved visibility due to a reduction in smog haze Plus there are benefits associated with lower emissions of other air pollutants

To date there appears to have been little work undertaken in assigning a monetary value to these benefits as it is considered that they are likely to be small compared to human health impacts

Health Costs and Benefits

The Final Impact Assessment for the Ambient Air Quality National Environment Protection Measure (NEPC 1998) estimated that the health damage costs from exposure to ozone nationally to be in the range of $90 ndash $270 million (in 1998 dollars) This figure did not include mortality costs because of difficulty in assigning a figure to human life nor did it include costs associated with minor symptoms such as sore throat cough headache chest discomfort and eye irritation that can result from ozone exposure On the cost of ozone exposure the Impact Assessment states that lsquothe social well-being associated with potentially 6 and 20 million fewer irritating symptoms annually cannot be reliably quantified but at $1 a symptom it adds up to an appreciable amountrsquo

Since the Air NEPM Impact Assessment ozone levels in Australian urban areas have not fallen significantly but the population and medical costs have increased since then However using the above figures to make a rough estimate the contribution made by engines used in lawnmowers (ie not including other garden equipment) to the health damages cost from ozone exposure would be at a minimum $36 - $108 million not including the cost of mortality or minor symptoms As any action on these engines is likely to only remove high emission engines over a decade or more a CBA would be required to include an assessment of the proportional health benefits that would accrue from only removing the high emitters over time

Costs and Benefits to the Consumer

In 1995 the USEPA estimated that on average the cost to the engine manufacturer to install the necessary emission control technology to meet Phase 1 standards (which didnrsquot have ABT) would be approximately $US2 per engine used in nonhandheld equipment and $US350 per engine used in handheld equipment It also estimated that this would translate to sales-weighted average price increases of about $US7

The introduction of phase 2 regulations USEPA estimated would result in price increases of between $US20 and $US64 for handheld equipment depending on the equipment class (USEPA 2000) where handheld engines ranges in price from $60 to $1000 (USEPA 1995)

In addition to emission reductions the implementation of exhaust emission limits has the advantage of reducing fuel consumption and lowering operating costs to the consumer For example the USEPA estimated that for Phase 1 limits that applied between 1995 and 2001 on an average sales-weighted engine basis would decrease fuel consumption by 26 percent for non handheld equipment and a 13 percent decrease in fuel consumption for handheld equipment (USEPA 1995) Phase 2

36

(current limits) would result in a further decrease in fuel consumption of approximately 30 percent for handheld engines

When the USEPA considered the fuel savings offset and the retail price increase it estimated that the average sales-weighted lifetime increase in cost would be about $US650 per handheld engine while nonhandheld engines will realize a lifetime savings of about $US250 per engine This does not include the lifetime savings in maintenance costs which should further benefit the consumer (USEPA 1995)

Euromot (The European Association of Internal Combustion Manufacturers) claims that compliance with European minimum performance standards that do not have ABT provisions adds around 30 to the cost of some products that have had to be brought into compliance4 compared to products sold under the ABT system in the US

Costs and Benefits to Industry and Government

As there is only one local manufacturer among the 43 distributors of powered outdoor garden equipment sold in Australia and all others are importers the main costs to reduce the emissions contribution made by these engines will be associated with program administration and compliance particularly if regulations are introduced

The Productivity Commission an independent agency which is the Australian Governmentrsquos principal review and advisory body on microeconomic policy and regulation recently examined the cost effectiveness of measures to improve the energy efficiency in household appliances As part of its review lsquoThe Private Cost Effectiveness of Improving Energy Efficiencyrsquo it examined labelling programs (ie regulated tiered benchmarks) and minimum mandatory energy efficiency requirements (ie a regulated simple benchmark) While the household appliance market is considerably larger than the garden equipment market the Commissionrsquos final report contains some information that is useful for determining the approach that could be used to establish an emissions reduction scheme for garden equipment A summary of relevant sections of this report is provided in Appendix 3

The Commission identified both administration and compliance costs associated with labelling programs and minimum mandatory energy efficiency requirements as well the impacts these had on product suppliers

The Department of the Environment and Water Resources provided details to the Commission on the costs involved in administering both the labelling scheme and the minimum performance standards for energy programs The information provided showed that

bull the administration costs of the simple benchmark approach were substantially lower (less than one tenth) than for labelling and 84 per cent of administration costs were passed on to appliance purchasers with the remainder borne by governments

4 Presentation by Dr Holger Lochmann Rob Baker Axel Rauch Stihl 19 April 2006

37

bull the compliance costs for labelling are higher

bull minimum mandatory energy efficiency requirements can have a greater cost for suppliers than labelling since suppliers must adjust their model ranges to meet the MEPS levels by the given date These compliance costs are however influenced by the lsquolead inrsquo time between introduction and the implementation of the regulations

bull The increased cost to appliance purchasers of labelled appliances was about two and half times higher compared to appliances purchased under minimum mandatory energy efficiency requirements this being due to consumers voluntarily purchasing more efficient appliances

Overall the Commission considered that labels should be more actively considered as an alternative to minimum performance standards The Commissionrsquos support was based on the ability of labels to amongst other things

bull directly address ldquoa source of market failure mdash the asymmetry of information between buyers and sellers of energy-using productsrdquo

bull provide information to the consumer that is readily-accessible and easily-understood so they can help the consumer make better-informed choices

bull Have net social benefits and possibly have net benefits for consumers

bull provide a greater incentive for suppliers to sell environmentally better products

bull warn consumers through a disendorsement label that an appliance is very inefficient This approach can discourage but not prevent consumers from buying the poor performing product

71 Options to Reduce Emissions from Garden Equipment Engines

There is a range of options that could be considered for reducing emissions from engines used in outdoor garden equipment in Australia These include

1 Do nothing

2 Partnership Programs

3 Quasi regulation

4 Co-regulation

5 Regulations

In the following discussion about these options many Australian examples are mentioned Further details about these programs plus an overview are provided in Appendix 2

38

72 Option 1 ndash Do Nothing

Based on data supplied by OPEA the sales of high emitting two stroke carburettor engines as a percentage of engines used in outdoor equipment increased during the period 2002 to 2005-6 (see Table 12) from 463 to 593 and overall sales number increased by 38 during that period There is no indication that in the short to medium term that sales of equipment with two stroke carburetor engines will decrease in overall sales numbers or as a percentage of sales Therefore under the lsquodo nothingrsquo option emissions from outdoor garden equipment will continue at the same rate or perhaps based on sales figures of two stroke carburetor powered equipment at an even higher rate in the future

73 Option 2 ndash Industry - Government Partnership

In the discussion papers prepared for the NSW small engine project (2004) some examples of successful voluntary Government-Industry Partnership programs were provided The examples included were

bull the National Industry Reduction Agreement where the major newspaper and magazine publishers in Australia agreed to promote recovery and recycling of old newspapers and magazines

bull the NSW EPA-Oil Industry MOU on Summer Fuel the National Packaging Covenant (which has legislative backup) and

bull the EPA Victoriarsquos agreement with the Altona Chemical Complex

From the Australian programs reviewed it appears that the best indicators for successful partnership programs are

bull a relatively small number of firms within the industry

bull a commitment and involvement by all of the industry

bull clear program aims and objectives plus program targets and

bull a willingness by the industry to enter into a cooperative partnership with government

There are 43 identified distributors selling 97 brands of outdoor powered equipment in Australia Many of the major distributors are members of OPEA but there are many distributors who are not members It is therefore unlikely that the even the majority let alone all of the Australian distributors would commit to a industry-government partnership to reduce emissions

74 Option 3 - Quasi Regulation

Quasi regulations can take a range of forms the most usual being the establishment of a code of practice that industry endorses and implements A fundamental part of the code of practice would be emissions standards There are few examples of the use of codes of practice to limit emissions

39

Governmentrsquos role under this scenario is likely to be in assisting in the development of standards

The likelihood of this option being successful for similar reasons to the industry government partnership option is low

75 Option 4 -Co Regulation

Co-regulation is an agreement by industry and government to certain undertakings that support the uptake of cleaner products with a regulatory base It allows industry program flexibility to achieve certain negotiated targets Australian examples of coshyregulation include

bull The Green Vehicle Guide which operates through an industry government agreement where industry report test results to government in an agreed format within a certain timeframe Government manages the data and promotes the program This program is underpinned by Australian Design Rules for motor vehicles

bull The electrical appliance stand-by power program where there are agreed targets established that industry is required lsquovoluntarilyrsquo to meet failure to achieve the targets will result in regulation

bull The Packaging Covenant which is a program that allows industry the flexibility to design it own programs to reduce packaging waste and achieve certain target The Covenant is complemented by the NEPM on used packaging which specifies certain government responsibilities to support the program plus measures that will be introduced if targets are not met

Given the large number of distributors on the Australia market co-regulation for engines used in garden equipment using a similar form to the standndashby power program or the packaging program - an agreement by industry and government on a percentage reduction target for the sale of high emitting engines within a specified timeframe together with an agreement that regulation will be adopted if the target is not met ndash is also unlikely to be successful

76 Option 5 - Regulation

Regulation which requires a clear acknowledgement of a sufficient problem by Government places uniform mandatory compliance obligations on industry The costs associated with regulations are usually shared between government and industry with the development of regulations and program administration costs being borne by government with industry meeting compliance costs including emissions testing and if applicable labelling costs

It could argued that regulation should be introduced in the States or Territories where there are exceedances of the Air NEPM ozone standards However development of state based regulations for garden equipment engines emissions is unlikely as they would be incompatible with the 1992 Intergovernmental Agreement on the

40

Environment signed by the Commonwealth States and Territories and existing Commonwealth and State Government mutual recognition legislation The Intergovernmental Agreement on the Environment which underpins the development of National Environment Protection Measures obligates all jurisdictions to ensure equivalent protection from air pollution to all Australians

In addition enforcement of any state based legislation would be a key problem Under the Commonwealth Mutual Recognition Act 1992 and the Trans-Tasman Mutual Recognition Act 1997 goods that are imported into or produced in an Australian State or Territory or New Zealand that can be sold lawfully in that jurisdiction can be sold freely in a second jurisdiction even if the goods do not comply with the regulatory standards of the second jurisdiction This means non-regulated small engine products legally sold in one State could be legally sold in any other state regardless of whether emissions limits on small engines applied in that State

National regulation on the other hand would provide national consistency It would also provide the opportunity to adopt worldrsquos best practice standards and incorporate penalties for non-complying parties

Under the Australian Constitution the Commonwealth does not possess specific legislative powers in relation to the environment and heritage There are however a number of legislative powers that can support environment and heritage legislation Furthermore Commonwealth legislative powers can be used cumulatively For example the Commonwealth Parliament can make laws under section 51(20) of the Constitution with respect to ldquoforeign corporations and trading or financial corporations formed within the limits of the Commonwealthrdquo

Legislative mechanisms may also be created through the development of a National Environment Protection Measure (NEPM) that then becomes law within each jurisdiction A NEPM can accommodate flexibility of implementation where jurisdictions that have elevated ozone levels can tailor their NEPM program to their specific air quality needs An example of this flexible approach is the Diesel NEPM which has a suite of programs which can be implemented by jurisdictions

From the review of Australian regulations to reduce the environmental impacts of products and the overseas approaches to control emissions from small engines two regulatory approaches become apparent a simple benchmark or tiered benchmarks These are outlined below

Regulatory Option1 - A Simple Benchmark Approach

The most basic regulatory approach that could be taken would be to have a single emission standard (or as per the USA Europe and California a number of emission standards based on power and application) for combined HC + NOx emissions All equipment with new engines sold in Australia from the date the regulations are introduced This approach would

bull remove the all high emission engines from sale

41

bull be supported by an Australian Standard and

bull provide consumers with confidence that all products meet certain emissions standard

Regulatory Option 2 -Tiered Benchmarks

Current Australian directions to reduce the environmental impact of consumer products favour tiered benchmarks using a lsquostarrsquo rating system (see Appendix 2 for examples)

For engines used in garden equipment a tiered emissions labelling system could be based on the USEPA Phase 1 and Phase 2 standards use a system of lsquostarsrsquo to provide information to consumers about environmental performance but not limit consumer choice A tiered lsquostarrsquo system approach would

bull reward those products with more stars that meet the more stringent overseas standards

bull either operate with minimum emissions performance standards or disendorsement labels

bull be supported by a product label and possibly a web database

bull provide consumers emissions information and the option to purchase a lower emission engine

bull be supported by an Australian Standard and

bull be devised to meet worldrsquos best practice which is an overarching approach supported by Government

Table 16 summarises the main strengths and weaknesses of the above options

42

Table 16 Main Strengths and Weaknesses of Each Option

Strengths Weaknesses

Do Nothing Does not limit consumer choice Emissions contribution likely to grow No cost to government No barrier to new market entrants selling

high emitters Consumers have a wide choice of products Industry unchecked amp product dumping

likely No enforcement recourse on environmental grounds available

Partnerships Some sharing of responsibility government Slow if any reduction in high emitters

ndash industry

Potential for Government assist in Few if any companies likely to join and no advancing reductions in high emitters restrictions on non signatories Reduction targets set Below worldrsquos best practice

Quasi Regulation Similar strengths to partnership option Similar weaknesses to partnership option as

few if any companies likely to adopt code of practice

Co-Regulation Ongoing consultation between industry and Due to industry diversity targets unlikely to government recourse to regulation be met Targets set and can require new market Slow reduction in emissions entrants to achieve targets Can have implementation flexibility Emissions test standard adopted

Regulation Option 1- Simple Benchmark Worldrsquos best practice standards can be ovide incentives to manufacturers to promote low adapted and is mandatory emitters

Recourse to legal action available for non Does not provide consumers with emissions compliance information Significant quantifiable health benefits Cost of enforcement borne by taxpayers Requires compliance by all industry and High cost to government bans high emitters

Regulation Option 2 ndash Tiered Benchmarks Provides consumers with emissions information but does not limit choice Incentives for manufacturers to sell low emitters Potentially significant quantifiable health benefits Can be designed to overcome ABT issue

Significant administration and compliance costs to Government High cost to government and industry and will increase retail price of engines Does not ban high emitters

43

77 Preferred Approach

From the above discussion and from the review of garden equipment on available to the Australian consumer there are many companies selling powered garden equipment on the Australian market and the market is very competitive Furthermore from the Expert Panel discussions and stakeholder consultation it is apparent that it is highly unlikely that all the companies in the garden equipment industry would engage in or commit to a voluntary program to reduce their productsrsquo exhaust emissions It is therefore clear that the only feasible path to reduce emissions from these small engines is through regulation

While regulations of emissions from small engines used in garden equipment in Australia are likely to be based on overseas regulations they need to strike a balance between improved environmental outcome harmonisation with international standards and the characteristics of the local industry With regulation optimum emissions reductions are achievable especially by combining minimum emissions standards with tiered product labelling Whether this approach is justifiable on economic grounds that is the benefits outweigh the costs can only be determined through a detailed impact assessment Based on these findings it is recommended that a formal assessment of the costs and benefits of nationally regulating 2 and 4 stroke lawn mowers and handheld power equipment should now be commenced

44

References Air Resources Board California Environmental Protection Agency Californian Exhaust Emission Standards and Test Procedures for 2005 and Later Small Off-road Engines July 26 2004

Artcraft 2003 A Major Research-Based Review and Scoping of Future Directions for Appliance Efficiency Labels in Australia and NZ prepared for the Australian Greenhouse Office viewed at wwwenergyratinggovaulibraryindexhtml

Australian Bureau of Statistics 1999 Older People Australia A Social Report Report Number 41090 December 1999

Australian Greenhouse Office 2002 Achievements 2002 National Appliance equipment energy efficiency program Commonwealth of Australia

Australian Greenhouse Office 2002 Achievements 2002 National Appliance equipment energy efficiency program Commonwealth of Australia

AustralianNew Zealand StandardtradeASNZS 64002005 Water efficient productsmdashRating and labeling Federal Register of Legislative Instruments F2005L01571

Bei L T and Widdows R1999 Product knowledge and product involvement as moderators of the effects of information on purchase decisions a case study using the perfect information frontier approach Journal of Consumer Affairs 33(1) 165-186

Buy Recycled Busines Alliance Briefing Paper Environmental Claims And Labelling Abstract lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10-2003

California Code of Regulations 1998 Final Regulation Order Article 1 and Article 3 Chapter 9 Division 3 Title 13 Attachment 1 26 March 1998 wwwarbcagovregactsoreregs_finpdf

Canada Gazette Part II Vol 137 No 24 2003-11-19

Canadian Gazette 29 March 2003 Vol 137 No 13 Part 1 pp 935- 955

Cap Gemini Ernst amp Young (2001) Cars Online 2001 Global consumer survey httpa593gakamainet75931951a8b278a28319eawwwcgeycomhightechautomediaC ars_online2pdf

Clothes Washers Australiarsquos Standby Power Strategy 2002 ndash 2012 Standby Product Profile 200308 October 2003 wwwenergyratinggovau

Craig ndash Lees M Joy Sally Browne B 1995 Consumer Behaviour John Wiley amp Sons Queensland 1995

Department of Environment and Conservation NSW 2004 Measures to Encourage the Supply and Uptake of Cleaner Lawnmowers and Outdoor Handheld Equipment

45

Department of Environment and Conservation 2003 Who cares about the environment in 2003 A survey of NSW peoplersquos environmental knowledge attitudes and behaviours DEC Social Research Series

Department of Environment and Conservation Action for Air update 2006

Department of Environment and Conservation The Buy Recycled Guide Online Directory viewed at wwwresourcenswgovauindex-RNSWhtm

EcoRecycle 2004 Paint Take-Back Takes Off in Bayswater Media release 24 March 2004 viewed at wwwecorecyclevicgovau May 2004

Enviromower viewed at wwwenviromowercomau June 2004

Environment Canada 2000 Future Canadian Emission Standards for Vehicles and Engines and Standards for Reformulation of Petroleum Based Fuels Discussion Paper in Advance Notice of Intent by the Federal Minister of the Environment April 2000 wwwecgccaenergfuelsreportsfuture_fuelsfuture_fuels1_ehtm

Environment Canada 2004 Environment Minister Urges Canadians to Reduce Greenhouse Gas Emissions and Mow Down Pollution With Unique Incentive Program Media Release April 23 2004 viewed at wwwecgccamediaroomnewsrelease May 2004

Environment Protection and Heritage Council National Environment Protection (Ambient Air Quality) Measure Report on the Preliminary Work for the Review of the Ozone Standard October 2005

Environment Protection Authority 2006 Victoriarsquos Air Quality ndash 2005 Publication 1044 June 2006 wwwepavicgovau

Environmental Choice NZ 2001 Public Good and Environmental Labelling An Internal Background Paper

European Commission Directive 200344EC amending the recreational craft directive and comments to the directive combined 211005

George Wilkenfeld and Associates Pty Ltd with Artcraft Research and Energy Efficient Strategies Tomorrow Today 2003 Final Report A Mandatory Water Efficiency Labelling Scheme for Australia Prepared for Environment Australia June 2003

George Wilkenfeld and Associates 2003 A National Strategy for Consumer Product Resource Labelling in Australia prepared for the Australian Greenhouse Office December 2003 viewed at wwwenergyratinggovaulibraryindexhtml

Green Vehicle Guide wwwgreenvehicleguidegovau

Harrington L and Holt S 2002 Matching Worldrsquos Best Regulated Efficiency Standards ndash Australiarsquos success in adopting new refrigerator MEPS wwwenergyratinggovaulibrarypubsaceee-2002apdf

46

Harris J and Cole A 2003 The role for government in ecolabelling ndash on the scenes or behind the scenes lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10-2003

Holt S and Harrington L2003 Lessons learnt from Australiarsquos standards and labeling program Paper presented at ECEEE Summer Study - 2-6 June 2003 wwwenergyratinggovaulibraryindexhtml

IBIS 2006a Domestic Hardware Retailing 09-Jun-2006 Industry Code G523b

IBIS 2006b Gardening Services 18-Jan-2006 Industry Code Q9525

IBIS 2003 Gardening Services in Australia 23 December 2003 Industry Code Q9525

Lawrence K Zeise K amp Morgan P 2005 Management Options for Non-Road Engine Emissions in Urban Areas Consultancy report for Department for Environment amp Heritage Canberra

Motor Vehicle Environment Committee (MVEC) in consultation with the Department of Transport and Regional Services 2002 Proposal for an Australian ldquoGreen Vehiclesrdquo Guide viewed at httpwwwdotarsgovaumvegreen_vehicles_guidedoc May 2004

National Appliance and Equipment Energy Efficiency Committee The Energy Label at wwwenergyratinggovau (3504)

National Environment Protection Council 2005 National Environment Protection (Ambient Air Quality) Measure Report on the Preliminary Work for the Review of the Ozone Standard October 2005

National Environment Protection Council 1998 Final Impact Assessment for Ambient Air Quality National Environment Protection Measure June 1998

National Environment Protection Council 1999 Used Packaging Materials Impact Statement for the Draft NEPM Used Packaging Material January 1999 viewed at wwwephcgovau

National Environment Protection Council 2004 National Environment Protection (Air Toxics) Measure April 2004 viewed at wwwephcgovau

New South Wales Government 2002 Protection of the Environment Operations (Clean Air) Regulation 2002

New South Wales Government 1999 NSW Government Procurement Policy Statement White Paper 1999

Nordic Council 2002 Ecolabelling of marine Engines Criteria Document 8 December 1995 ndash 6 December 2005 version 35 December 2002

47

Office of Public Sector Information Statutory Instrument 2004 No 2034 The Non-Road Mobile Machinery (Emission of Gaseous and Particulate Pollutants) (Amendment) Regulations 2004 wwwopsigovuksisi200420042034htm

Outdoor Power Equipment Institute 2001 Profile of the Outdoor Power Equipment Industry wwwopeiorg

Productivity Commission 2004 The Private Cost Effectiveness of Improving Energy Efficiency Final report October 2005 wwwpcgovauinquiryenergy

Publishers National Environment Bureau Media Release lsquoAustralia leads the world in newspaper recyclingrsquo 6 June 2006 wwwpnebcomau

Real J Jones A 2005 The Green Vehicle Guide Clean Air Soceity of Australia and New Zealand Conference 2005 Hobart

Salmon G Voluntary Sustainability Standards and Labels (VSSLs) The Case for Fostering Them OECD Round Table On Sustainable Development

Schkade D A and Kelinmutz D N 1994 Information displays and choice processes differential effects of organization form and sequence Organizational Behavior and Human Decision Processes 57(3) 319-337

Stephens A 2003 Eco Buy (Local Government Buy Recycled Alliance Victoria) Abstract lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10shy2003

Teisl M F Roe B and Hicks RL 2002 Can eco-labels fine tune a market Evidence from dolphin-safe labeling Journal of Environmental Economics and Management 43339-359

Teisl M F Roe B and Levy A S Ecolabelling What does consumer science tell us about which strategies work pp141-150

The ISO 14000 family of standards guides and technical reports

The Parliament of the Commonwealth of Australia 2004 House of Representatives Water Efficiency Labelling and Standards Bill 2004 Explanatory Memorandum wwwcomlawgovauComLawLegislationBills1nsf viewed February 2006

Thogerson J 2000 Promoting green consumer behaviour with eco-labels Workshop on Education Information and Voluntary Measures in Environmental Protection National Academy of Sciences ndashNational Research Council Washington DC November 29-30

United States Environmental Protection Agency Federal Register Vol 60 No 127 3 July 1995 Control of Air Pollution Emission Standards for New Nonroad Spark-ignition Engines At or Below 19 Kilowatts wwwepagovEPA-AIR1995JulyDay-03prshy805txthtml

48

United States Environmental Protection Agency Federal Register Vol 69 No 7 12 January 2004 Rules and Regulations 40 CFR Part 90 Amendments to the Phase 2 Requirements for Spark-Ignition Nonroad Engines at or Below 19 Kilowatts Direct Final Rule and Proposed Rule wwwepagovfedrgstrEPA-AIR2004JanuaryDay-12a458pdf

United States Environmental Protection Agency Office of Pollution Prevention and Toxics Pollution Prevention Division 1998 Ecolabelling Environmental Labelling - A Comprehensive Review of Issues Policies and Practices Worldwide

United States Environmental Protection Agency Office of Transportation and Air Quality March 2000 Regulatory Announcement Final Phase 2 Standards for Spark-Ignition Handheld Engines

United States Environmental Protection Agency 1998 Proposed Phase 2 Emission Standards for Small SI Engines 27 January 1998

United States Environmental Protection Agency 2000 Regulatory announcement Final Phase 2 Standards for Small Spark-Ignition Handheld Engines March 2000 EPA420-F-00shy007

United States Federal Register Vol 69 No 7 Monday January 12 2004 Rules and Regulations Environmental Protection Agency 40 CFR Part 90 Amendments to the Phase 2 Requirements for Spark-Ignition Nonroad Engines at or Below 19 Kilowatts Direct Final Rule and Proposed Rule United States Federal Register Vol 64 No 60 30 March 1999 40 CFR Part 90 Phase 2 Emission Standards for New Nonroad Spark-Ignition Nonhandheld Engines At or Below 19 Kilowatts Final Rule pp15214-15216

United States Federal Register Vol 65 No 80 25 April 2000 40 CFR Parts 90 and 91 Phase 2 Emission Standards for New Nonroad Spark-Ignition Handheld Engines at or Below 19 Kilowatts and Minor Amendments to Emission Requirements Applicable to Small Spark-Ignition Engines and Marine Spark-Ignition Engines Final Rule pp24282-24284

United States Environmental Protection Agency Control of Air Pollution Emission for New Nonroad Spark-ignition Engines At or Below 19 Kilowatts Final Rule 40 CFR Parts 9 and 90 1995 wwwepagovEPA-AIR1995JulyDay-03pr-805txthtml

United States Environmental Protection Agency Office of Pollution Prevention and Toxics Pollution Prevention Division 1998 Ecolabelling Environmental Labeling- A Comprehensive Review of Issues Policies and Practices Worldwide

Victorian Government Greenhouse Strategy Community Action Fund - Mow Down Lawn Mower Rebate Exchange Program wwwgreenhousevicgovaucommunitygrantscafsuccessfulprojectshtm

Water Efficiency Labelling and Standards Act 2005 No 4 wwwcomlawgovauComLawLegislation

49

Water Efficiency Labelling and Standards Determination 2005 wwwcomlawgovauComLawLegislationLegislativeInstrument1nsf

Water Efficiency Labelling and Standards Regulations 2005 wwwcomlawgovauComLawLegislationLegislativeInstrument1nsf

Wilkie W 1994 Consumer Behaviour John Wiley and Sons NY as cited in Craig ndash Lees M Joy Sally Browne B 1995 Consumer Behaviour John Wiley amp Sons Queensland 1995

wwwenergyratinggovau

wwwgreenvehicleguidegovau

wwwwaterratinggovau

50

Appendix 1 Detailed Breakdown of Powered Garden Equipment on the Australian Market

The following table gives a profile of the current equipment on the Australian market It is based mostly on distributor responses to a survey and might not be representative of the total market

Low sales indicates that no sales data was available but volumes are likely to be small compared with popular equipment Phase 1 is US EPA Phase 1 or EU Directive 200288EU Phase 2 is US EPA Phase 2 or Euro standards

Type Ranges Stroke Aerator 5 makes 6 models Sales Low

Engine power 26 to 172kW Engine displ 143-674 ml

2c -4c 5 Unspecified 1 Phase 1 - Phase 2 4

Auger 3 makes 5 models Sales Low

Engine power 12 to 16kW Engine displ 31-ml

2c 5 4c -Unspecified -Phase 1 1 Phase 2 1

Backhoe 0 makes 0 model Sales Low

(2 models in 2003) -

Blower 13 makes 49 models Sales 109K

Engine power 07 to 31kW Engine displ 24-80ml

2c 34 4c 2 Unspecified 13 Phase 1 10 Phase 2 17

Blower-wheeler 3 makes 6 models

Engine power 07 to97kW Engine displ 24-305ml

2c 1 4c 4 Unspecified 1 Phase 1 3 Phase 2 -

Blowervac 6 makes 9 models Sales

Engine power 07 to 11kW Engine displ 24-34ml

2c 6 4c -Unspecified 3 Phase 1- Phase 2 3

Brush cutter 12 makes 95 models Sales 339K

Engine power 06 to 23kW Engine displ 21-54ml

2c 66 4c 5 Unspecified 24 Phase 1 15 Phase 2 34

Chainsaw 9 makes 106 models Sales 152K

Engine power 1 to 58kW Engine displ 26-122ml

2c 74 4c -Unspecified 32 Phase 1 18 Phase 2 27

Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

51

Type Ranges Stroke Clearing saw Engine power 14 to 27kW 2c 6 3 makes Engine displ 36-57ml 4c 0 9 models Unspecified 3 Sales low Phase 1 4 Phase 2 -Cultivator Engine power 07 to 52kW 2c 2 4 makes Engine displ 25-190ml 4c 5 7 models Unspecified -Sales low Phase 1 - Phase 2 5 De-thatcher Engine power 1kW 2c 1 1 makes Engine displ 27ml 4c -1 models Unspecified -Sales low Phase 1 - Phase 2 1 Drill Engine power 1kW 2c 3 3 makes Engine displ 27ml 4c -4 models Unspecified 1 Sales low Phase 1 - Phase 2 1 Edger Engine power 1 to 4kW 2c 12 10 makes Engine displ 24-190ml 4c 11 36 models Unspecified 1 Sales Phase 1 3 Phase 2 22 Garden tractor Engine power 12 to 157kW 2c -2 makes Engine displ 465 to 675ml 4c 5 12 models Unspecified 9 Sales low Phase 1 - Phase 2 3 Grass trimmer Engine power- 2c 3 1 make Engine displ 31ml 4c -3 model Unspecified -Sales Phase 1 - Phase 2 3 Hedge trimmer Engine power 06 to 1kW 2c 28 10 makes Engine displ 21-31ml 4c 1 42 models Unspecified 13 Sales 40K Phase 1 4 Phase 2 35 Lawnmower Engine power 26 to 66kW 2c 22 19 makes Engine displ 100-270ml 4c 151 183 models Price $449-$3609 Unspecified 10 Sales 424K Phase 1 95 Phase 2 48 Line trimmer Engine power 07 to 45kW 2c 25 8 makes Engine displ 24-195ml 4c 2 29 models Price $136-$299 Unspecified 2 Sales Phase 1 2 Phase 2 6 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

52

Type Ranges Stroke Log splitter Engine power 26 to 45kW 2c -1 makes Engine displ 100-195ml 4c 2 2 models Unspecified -Sales low Phase 1 - Phase 2 1 Multicutter Engine power 08 to 14kW 2c 17 5 makes Engine displ 23-36ml 4c 1 19 model Unspecified 1 Sales Phase 1 2 Phase 2 13 Olive nut shaker Engine power - 2c -1 make Engine displ - 4c -1 model Unspecified 1

Phase 1 - Phase 2 -Pole saw Engine power 08 to 14kW 2c 6 4 makes Engine displ 23-36ml 4c -10 models Unspecified 4 Sales low Phase 1 1 Phase 2 3 Power carrier Engine power 37 to 231kW 2c -2 makes Engine displ 160 to 953ml 4c 11 11 models Unspecified -Sales low Phase 1 - Phase 2 10 Power cutter Engine power 32 to 45kW 2c 5 2 makes Engine displ 64-99ml 4c -8 models Unspecified 3 Sales low Phase 1 1 Phase 2 3 Pruner (3 models in 2003) 2c -0 make 4c -0 models Unspecified -Sales low Ride-on-mower Engine power 26 to 231kW 2c -12 makes Engine displ 100 to 725ml 4c 93 124 models Unspecified81 Sales 51K Ph1 1 Ph2106 Rotary hoe (4 models in 2003) 2c -0 makes 4c -0 models Unspecified -Sales low Shredder Engine power 3 to 96kW 2c 1 6 makes Engine displ 126-389ml 4c 16 20 models Unspecified 3 Sales 46K Phase 1 - Phase 2 4 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

53

Type Ranges Stroke Stump grinder Engine power 96kW 2c -1 make Engine displ 389ml 4c 1 1 model Unspecified -Sales low Phase 1 - Phase 2 1 Tiller Engine power 08 to 59kW 2c -3 makes Engine displ 25-243ml 4c 8 9 models Unspecified 1 Sales low Phase 1 - Phase 2 7 Trencher Engine power37kW 2c -1 makes Engine displ 183ml 4c -1 models Unspecified 1 Sales low Phase 1 - Phase 2 1 Trimmer Engine power - 2c 10 2 makes Engine displ - 4c -21 models Price - Unspecified 11 Sales Phase 1 4 Phase 2 -Turfcutter Engine power 37kW 2c -1 makes Engine displ - 4c 1 1 models Unspecified -Sales low Phase 1 - Phase 2 -Vac Engine power 22 to 172kW 2c 1 5 makes Engine displ 158 to 674ml 4c 13 15 models Unspecified 1 Sales Ph11 Ph24 Vac chipper Engine power 34 to 45kW 2c -2 makes Engine displ 158-195ml 4c 3 3 models Unspecified -Sales low Phase 1 - Phase 2 1 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

54

Appendix 2 Examples of Current Australian Benchmarking Programs

The following describes in varying degrees of detail a number of current Australian benchmarking schemes classified by program type simple bench mark approaches tiered benchmarks and government industry partnerships This appendix concludes with a summary table of these programs with an assessment of their effectiveness

1 Introduction

Simple benchmark schemes (described below) such as the woodheater standards set a single point hurdle rate whereas the green vehicle guide use tiered benchmarks The new water efficiency labelling scheme and minimum energy efficiency performance standards uses both a simple benchmark through minimum performance requirement plus tiered benchmarks incorporated into labels as lsquostarsrsquo Other approaches such as the stand-by power program and the Victorian Altona Complex VOC reduction target set goals for achievement within a specified time period Other approaches taken to reduce environmental impacts include the National Packaging Covenant which uses a program based on individual companies developing tailored approaches to suit their circumstances and is supported by enforcement capability through the National Environment Protection (Used Packaging Materials) Measure (the NEPM)

2 Simple Benchmarks

21 Minimum Energy Performance Standards (MEPS)

Purpose

MEPS prescribe a minimum allowed energy performance for specific appliances Appliances that are less efficient than the relevant standard are excluded from the market

Background and Strategy

In October 1999 as part of the National Greenhouse Strategy (1998) nationally consistent MEPS and labelling schemes were adopted across Australia

Independent NATA accredited laboratories undertake product compliance checks to see whether products perform in compliance with MEPS requirements For example

bull In 2003 the government conducted check tests on eight appliance models all of which were found not to meet the claims made on the energy performance labels Two products were deregistered one was found to have not been registered and action was pending on the remaining five products (AGO 2003b)

55

bull Other regulatory actions undertaken in 2003 included fines of $3000 and $8000 against two Western Australian retailers who were found to have sold appliances without energy performance labels Queensland and Victorian retailers received infringement notices and fines totalling $10 000 (AGO 2003b)

Summary RegulNated minimum performance standards based on an Australian Standard

22 Energy Star

Purpose

An endorsement label that indicates an electronic product has achieved a specified standard when it is not performing its core function (ie on stand by)

Background and Strategy

Energy Star is a voluntary endorsement labelling program developed by the US Environmental Protection Agency (US EPA) It has been operating in the USA since 1992 and has been adopted by a number of countries including Australia Energy Star sets voluntary standards for reducing the electricity consumption of electronic equipment when it is not performing its core function

The Government stand ndash by program which is outlined below complements the energy star labelling program

Summary Voluntary endorsement label

23 Woodheater Standards

Purpose

To reduce particle emissions through Australian Standard compliant woodheaters

Background and Strategy

Since 1992 Australian StandardNew Zealand Standards have been introduced to improve the performance of wood heaters

The first standard for wood heater emissions AS4013 (1992) was published in 1992 and was revised and published as a joint AustralianNew Zealand Standard in 1999 ASNZS4013 (1999) Domestic solid fuel burning appliances - Method for determination of flue gas emission This Standard provides a test method to measure particles emitted by residential solid-fuel burning heating appliances

56

The 1992 Standard included an upper limit for acceptable particle emissions of 55 grams of particles per kilogram (oven-dry weight) of fuel burnt This emission factor was reduced to 4 gkg in the 1999 revision of the Standard The Standard applies to solid-fuel burning space-heating appliances (including those fitted with water heating devices) with a heat output of 25KW or less It does not apply to masonry fireplaces cooking stoves central heating appliances or water-heating-only appliances

AS 4013 (1999) is complemented by ASNZS4014 (1999) Domestic solid fuel burning appliances - Test Fuels and ASNZS4012 (1999) Domestic solid fuel burning appliances - Method for determination of power output and efficiency

The woodheater industry was instrumental in initiating the development of standards and it lobbied states and territories to enact legislation to mandating that woodheaters be required to meet the standards As the health affects of particle pollution have become more apparent and as some jurisdictions are having difficulty in meeting national particle standards Government has become more proactive in controlling woodheaters and more supportive of tighter standards

All states and territories with the exception of South Australia have regulations that restrict emissions from new woodheaters although Victoria for example only introduced its regulations in 2004 compared to Tasmania who introduced regulations in 1993 These regulations require that new woodheaters comply with the Australian Standard ASNZS 4013 The State regulations however are not uniform

Many woodheaters that are currently certified for sale do not comply with the revised standard as verified in a National Woodheater Audit Program undertaken in 2004 Seven of the 12 wood heaters tested failed to meet the ASNZS 4013 particle emission limit In addition 55 of heaters were found to have deviations from the original designs and 72 had labelling faults that could adversely affect emissions performance

Testing and certification are administered by the industry association

Summary State and regulations requiring compliance with Australian Standards Certification administered by industry association

24 Standby Power

Purpose

To reduce lsquoexcessiversquo energy consumed in electrical appliance standby mode sold in Australia through in the first instance voluntary targets Appliances covered by the program range from information technology equipment such as PCs and photocopiers entertainment equipment such as TVs DVDs and sound systems major appliances such as water heaters dishwashers and refrigerators and small appliances such as smoke detectors and bread makers

57

Background and Strategy

In 2000 standby power was estimated to constitute 116 per cent of Australiarsquos residential energy use costing households over $500 million and leading to the emission of over 5 million tonnes of carbon dioxide equivalent (AGO 2002c) Holt and Harrington (2004) estimated that standby power consumption in Australia could be reduced by 56 per cent by 2020 (Productivity Commission 2005)

In August 2000 all Australian jurisdictions agreed to pursue efficiencies in standby power consumption of energy-consuming products through support for the International Energy Agencys One -Watt program and endorse its incorporation into theprogram of work

Australia reportedly has taken the lead on implementing the One- Watt program even though many of the products sold in Australia are imported

During 2002 government agencies consulted with stakeholders about ideas to reduce standby The standby strategy which proposed a list of targeted potential product types was presented to the Ministerial Council on Energy

In September 2003 an interim test method for the measurement of standby power ASNZS 62301-2003 (int) based on an internationally recognised standard was published Also during this period work commenced on developing draft product profiles for high priority targeted products

Once product profiles are completed interim voluntary date-specific targets are made The product sales are then monitored to determine progress towards the interim target If it is then determined that inadequate progress is being achieved by a significant number of suppliers then government will regulate

For example the interim 2007 target for clothes washers is as follows

Product Off mode power End of program mode

lt 1W lt 4 W

The National Standby Strategy Target to be achieved by 2012 for clothes washers is as follows

Off mode power End of program mode lt 03 W lt 1 W

In support of the clothes washer program Government will

bull consider creating a Government Purchasing Policy to buy low standby clothes washers where available and fit for purpose

bull collect data on all modes for new clothes washers and analyse trends

bull highlight the range of performances by publishing performance data on clothes washers on a website or by other means

58

bull progressively include standby energy consumption into the Comparative Energy Consumption for labelled products such as clothes washers and clothes dryers

bull work with the Standards Committees to finalise the details of modes and test methods for the relevant standards

bull determine in 2008 if progress is inadequate and if regulation is required

Summary Industry targets possible future regulation

3 Tiered Benchmarks

31 Mandatory Energy Efficiency Label ndash the Energy Star Programs

Purpose

To enable consumers to easily compare the energy performance of electrical appliances used by households and firms through a labelling scheme

Background and Strategy

Several Australian states commenced mandatory energy efficiency labelling for major appliances in the mid-1980s In 1992 it became mandatory across Australia for initially refrigerators and later freezers clothes washers clothes dryers dishwashers and air-conditioners (single phase only) to carry the label when they are offered for sale This labelling program is regarded as one of the most successful in the world (Wilkenfeld and Assoc 2003) It is administered through the Australian Greenhouse Office

The energy rating label for dishwashers

(ldquoa joint government and industry programrdquo) and a website address (wwwenergyratinggovau) and has two main features

bull the star rating which gives a quick comparative assessment of the models energy efficiency and

bull the comparative energy consumption (usually kilowatt hoursyear) which provides an estimate of the annual energy consumption of the appliance based on the tested energy consumption and information about the typical use of the appliance in the home These values are measured under Australian Standards which define test procedures for measuring energy consumption and minimum energy performance criteria Appliances must meet these criteria before they can be granted an Energy Rating Label

The Energy Rating Label includes an endorsement

59

Awards Brand ModelInstallat

ionType

Phase Available

10 Yr Energy

Cost StarRating

Output(kW)

TOSHIBA

Digital Inverter Series Air

Conditioner RAV-SM1102BT-

ERAV-SP1102AT-E (

RAV-SM1102BT-ERAV-

SP1102AT-E)

SingleSplit

SystemDucted

Single $1500 1000

CHUNLAN

KFR-32GWVWa (

NO)

SingleSplit

SystemDucted

Single $645 323

Since its introduction the star rating label seems to have established a high level of recognition with consumers Consumer research (Artcraft 2003) indicates that the different information on the label appeals to different consumer segments interested in purchasing an appliance

When a manufacturer gains approval to use the label they pay for and produce the label in accordance with specifications on size colours fonts layout and design A similar colour scheme and design to the energy consumption label is also used for the compulsory fuel consumption label on new passenger and light commercial vehicles

The labelling scheme is underpinned by regulation whereby regulated Minimum Energy Performance Standards (MEPS) provide the environmental benchmarks that the appliances are required to meet Appliances that do not meet the minimum energy performance standards can be withdrawn from the Australian market

When the energy rating program was reviewed in 2000 technology had advanced to the point where a large percentage of appliances had achieved the maximum number of stars so the rating system was tightened It is estimated that over the 25 year period 1980 to 2005 there will have been an overall reduction in energy consumption of around 70 by the most popular sized refrigerators (with freezers) (Harrington L and Holt S 2002)

In addition to the energy consumption label there is a website (wwwenergyratinggovau) with a comprehensive database of all appliances their star rating and energy consumption In 2002 there were around 220000 hits on the programrsquos various websites and 523000 in 2003 reportedly representing 80000 visits by individual inquirers The website hit rate is estimated to represent almost 10 of consumers who are considering purchasing an appliance (Holt et al 2003)

Cooling

Energy Input (kW)

250

104

Figure B Excerpt from Energy Rating web page for Air Conditioners (cooling cycle only shown)

When the energy rating program was reviewed in 2000 technology had advanced to the point where the Scheme had to be tightened because a large percentage of appliances had achieved the maximum number of stars For example energy use by refrigerators was around 70 compared to that used when the scheme started (Harrington L and Holt S 2002)

60

Regulations

State and Territory legislation refer to the relevant Australian Standards This approach simplifies the State and Territory legislation and makes it relatively straightforward to maintain national consistency of appliance and equipment energy efficiency standards even when standards are continually being revised

The testing procedures and technical requirements for the label and also Minimum Energy Performance Standards (MEPS see below) are incorporated into the applicable Australian Standards Products for sale must be registered with one of the State regulators

Program Administration

The labelling program and MEPS program are administered by the National Appliance and Equipment Energy Efficiency Committee (NAEEEC) which is ultimately directed by the Ministerial Council on Energy

Requirements for Appliance Suppliers

Appliance suppliers are required to

bull Submit applications for product registration and these must include a test report or other data to demonstrate that the appliance meets the relevant Australian Standard

bull While test reports on three separate units are required for most products there is no particular requirement for test laboratories to be accredited or products certified for registration for energy labelling and MEPS in Australia Test reports from the manufacturers laboratory are satisfactory However if there is evidence that results from a particular laboratory are unsatisfactory regulators can mandate test reports from an accredited laboratory

Summary Mandatory labelling scheme backed by regulations and an Australian Standard

32 Water Appliances Water Efficiency Labelling and Standards (WELS) Scheme

Purpose

A labelling scheme backed by legislation to promote domestic water efficient appliances

Background and Strategy

A voluntary water efficiency industry administered labelling scheme has been in existence since 1988 The water efficiency ratings and details on the label design are covered in ASNZS 6400 The main incentive of the voluntary lsquoAAAAArsquo scheme

61

has been the publicity and cash rebates offered by water utilities However the coverage water efficiency performance requirements and impact of this program have been limited

In 2003 the Environment and Heritage Ministers agreed to implement a national Water Efficiency Labelling Scheme (WELS) for products such as shower heads washing machines dishwashers and toilets Consultation with industry and stakeholders was undertaken in 2003 with a strategic study published that identified the products to be included in the new labelling Scheme A Regulation Impact Statement (RIS) which identified the costs and benefits of various options and made various recommendations was published in March 2004 Following public review of the RIS some modifications were made to WELS

The WELS Scheme is backed by the following legislation and standard

Water Efficiency Labelling and Standards Act 2005 which establishes

bull the products subject to the Scheme and the requirements for registration and labelling

bull the standards to apply to WELS products setting requirements for water efficiency performance registration and labelling of these products

bull enforcement provisions including penalties bull the appointment of inspectors to investigate possible contraventions and sets

out their powers and obligations bull review and dispute resolution bull a program Regulator bull the making of regulations bull a requirement for annual reports and for an independent review after five years

Water Efficiency Labelling and Standards Regulations 2005 which

bull prescribes the circumstances in which a person other than the manufacturer of a WELS product may be taken to be the manufacturer of the product (eg an importer)

bull sets out procedures for the issuing and the payment of penalty infringement notices as an alternative to prosecution for offences against the WELS Act

bull specifying the information to be included on an identity card issued to a WELS inspector

Water Efficiency Labelling and Standards Determination 2005 amongst other things determines and establishes product registration fees and calls up the Australian Standard ASNZS6400 2005 Water-efficient products - Rating and labelling which

bull defines the products

bull specifies the assessment procedures (ie identifies test procedures in other Australian Standards)

bull provides the formulas to give products their star rating

bull specifies the labels and their application to products

62

Approximately twenty organisations were represented on the Standards Committee that developed the Standard

State and Territory legislation

The States and Territories have also enacted or agreed to enact complementary legislation to ensure that the WELS Scheme has comprehensive national coverage State and Territory legislation which is almost a mirror of the Commonwealthrsquos Water Efficiency Labelling and Standards Act 2005 enables the States and Territories to for example undertake certain responsibilities delegated to them by the Commonwealth Regulator appoint their own inspectors and enforce the WELS

Other features of WELS include

bull A product web database

bull With the exception of toilets no other products are required to meet mandatory water efficiency requirements (WES) but this may change over time The introduction of mandatory WES means that products not meeting the minimum performance requirements can not legally be sold

bull Products must be tested in accordance with the relevant Standard and must meet any minimum performance and water efficiency requirements in the Standard before they can be granted a WELS Water Rating label

bull It is up to manufacturers or their agents (eg importers in the case of imported products) to ensure that their products are correctly registered and labelled and comply with any other requirements of the Standard

There is a transition phase which gives manufacturers and importers time to test register and label products and to sell pre-existing stock From 1 January 2008 all products are required to display the WELS Water Rating labels irrespective of their date of supply

63

The WELS Water Rating label

Label Features

bull A star rating for a quick comparative assessment of the models water efficiency

bull Labels with 1 to 6 stars

bull Some products may also be labelled with a Zero Star Rated label which indicates that the product is either not water efficient or does not meet basic performance requirements

bull A productrsquos water consumption figure

bull There are provisions for swing tags if there is inadequate surface area for label or the item is likely to be marked by sticking the label on the product

Summary Mandated product labelling using lsquostarrsquo rating system Has a disendorsement label and has provisions to ban products

33 Gas Appliance Rating Scheme

Purpose

A gas labelling program to improve the energy efficiency of gas powered products

Background and Strategy

The Gas and Fuel Corporation of Victoria introduced energy labelling for gas water heaters in 1981 This scheme was taken over by the AGA in 1985 who in 1988 introduced a six star energy performance label This label was intended to be visually consistent with the star rating labels already familiar to consumers of electrical appliances

The labelling scheme is currently voluntary and still administered by the industry body

A range of gas appliances have been subject to minimum energy performance standards (MEPS) since the 1960s The current MEPS levels were set in 1983 and

64

Brand Model Type MjyearStar

RatingSRI

StorageCapacity

(ltrs)IndoorOutdoor

NaturalGas

Instantaneous 18969 59 I N

Instantaneous 18969 59 I N

lsquothe majority of models currently on the market appear to exceed current requirements by a comfortable marginrsquo (SEAV 2003 p 23)

The gas energy labels are similar in format to those found on electrical appliances except they are blue and show annual energy use in MJ

A trial web site listing gas water heaters available in Australia is also available (see below)

Bottle Gas

Rinnai Infinity

V Series

REU-V2632FFU-A (Infinity 26 plus internal) P

Rinnai Infinity

V Series

REU-V2632FFUC-A (HD2001 internal) P

A joint review of the scheme is under way by the Gas Industry and Governments and regulation is under consideration A three year work plan has been published under the Australian and New Zealand Appliance and Equipment Energy Efficiency Program

Summary Currently voluntary labelling using lsquostarrsquo rating system with mandatory minimum energy performance standards Future regulation is under consideration

34 Green Vehicle Guide

Purpose

To provide web-based comparable and accessible environmental data on new motor vehicles

Background and strategy

65

The Commonwealth government started publishing a booklet of fuel consumption data for new passenger and light commercial vehicles in the early 1980s and a low cost web database in more recent years

In 2004 the Government through the Department of Transport and Regional Services (DOTARS) expanded the fuel consumption guide into the Green Vehicle Guide The Green Vehicle Guide is a web based database that rates new passenger and light commercial vehicles on air pollution greenhouse emissions and fuel consumption and gives an overall lsquostarrsquo rating for each vehicle within each vehicle category (small medium luxury sports etc)

The data on which the scores are derived are provided voluntarily by the vehicle manufacturers however this data is based on mandatory Australian Design Rule certification test data

The Guide uses a 5 star rating system however it also assigns half stars resulting in a total of 10 levels

The Greenhouse Ratings are based on carbon dioxide emissions and the Air Pollution Ratings take into account the relative environmental impact of oxides of nitrogen hydrocarbons and particles The relative harmfulness of the pollutants (shown in table below) has been quantified based on the allowable concentrations under the Ambient Air Quality National Environment Protection Measure (NEPM)

Green Vehicle Guide Weighting of Regulated Vehicle Emissions

Vehicle Emission

(equivalent pollutant under Air NEPM)

Calculated

Relative

Harmfulness

Final

Weighting

Carbon Monoxide (CO) 0088 Not included

Oxides of Nitrogen (NOx) (based on

Nitrogen Dioxide)

4 1

Hydrocarbons (HC) (based on

photochemical oxidants as ozone)

5 1

Particulate Matter (PM) (based on PM10) 20 5

Source Real and Jones 2005

NOx and HC were given equal final weightings despite the slight difference in the calculated relative harmfulness primarily because under ADR7900 a combined HC+NOx limit is prescribed rather than individual limits for each pollutant

The higher weighting for particulate matter recognises its significant health impacts The Air Pollution rating scale was devised in such a way that a lsquotypicalrsquo car (that is most petrol engined passenger cars meeting the current emission standard at the time) receives a mid-point rating (5 out of 10)

66

The overall rating or stars is derived from the sum of the air pollution and greenhouse scores ie they are equally weighted

Development of the Green Vehicle Guide (see extract below) involved extensive consultation with vehicle manufacturers

Website Costs

The new highly automated web database which contains data on approximately 1400 vehicles and has sophisticated search facilities cost approximately $200000 to develop plus around $100000 was spent recently to improve the sitersquos usability This compares to the previous low cost database which together with the printed guide cost less than about $80000 per annum The low cost version lacked the automation was only updated annually and did not have the ability to compared vehicles

The manufacturers provide the data on line using special access codes This data is checked by DOTARS before it is uploaded onto the website It takes close to a full time position within DOTARS to administer the website and respond to website related queries

Market Research and Marketing

Before the new greenvehicleguidegovau website was launched DOTARS commissioned consumer surveys to determine the level of knowledge about the environmental impacts made by vehicles This research showed that around half of those surveyed had the belief that ldquoall new cars have the same level of impact on the environmentrdquo

It became apparent through the surveys that there was a need to provide consumers with meaningful information on the relative performance of different vehicles This was a view shared by the Productivity Commission who said that while markets provide extensive information to consumers regarding fuel consumption of motor vehicles ldquothe Australian Governmentrsquos Fuel Consumption Labelling Scheme and Green Vehicle Guide provide relatively low cost accessible and comparable information to consumers and may be justified as part of the more fundamental objective of encouraging consumers to reduce the adverse environmental impacts of motor vehicle userdquo The Productivity Commission also commented that government

67

sources of information of this type were seen as credible and reliable and held in higher regard than information provided by others

DOTARS has scheduled some follow up consumer research for 200062007

DOTARS has spent about $600000 in marketing the Green Vehicle Guide This has included advertising in weekend guides in newspapers developing facts sheets plus targeted marketing to motor vehicle journalists

Summary Website - voluntary but legislative base

4 Government-Industry Partnership programs

Government-Industry Partnerships are the basis of many environmental initiatives and can take a number of forms Industry and government negotiate the terms of the program which are normally detailed in a formal agreement which sets out the environmental objectives and the responsibilities of each party towards their achievement

The GovernmentIndustry Partnership programs outlined below indicate the varied nature of these initiatives

41 The National Packaging Covenant

The National Packaging Covenant (the Covenant) commenced in 1999 and is a voluntary agreement between all levels of government and companies throughout the packaging chain including raw material suppliers packaging producers and retailers The Covenant commits signatories to the implementation of best practice environmental management in areas such as packaging design production and distribution and research into life cycle issues Signatories to the Covenant produce action plans on the measures they will implement to reduce packaging waste and they report annually on their progress In this sense the Covenant provides flexibility to signatories to develop plans suitable to their own circumstances The Covenantrsquos success (it currently has over 600 signatories) is due to the active promotion of it by Government and key industry players

The Covenant is complemented by a regulation the National Environment Protection (Used Packaging Materials) Measure (the NEPM) which enables states and territories to use enforcement action to require companies that donrsquot sign the agreement to take steps to reduce their packaging waste Preceding the Covenant and the NEPM were a number of voluntary industry agreements but these were limited in scope and largely focused on companies in the beverage industry

42 National Industry Reduction Agreement

The Publishers National Environment Bureau (PNEB) was formed in 1990 as an association of the major publishers of newspapers and magazines in Australia to promote the recovery and recycling of old newspapers and old magazines primarily from community kerbside collections organised by local councils

68

The PNEB and a newsprint manufacturer have voluntarily entered into a series of five-year Industry Waste Reduction Agreements with the Commonwealth and State Governments Under the current (third) plan 2001-2005 newsprint recycling in Australia has grown to 754 nationally in 2005 from the 28 level when the PNEB was formed in 1990

43 StateLocal target based programs

There have been a number of agreements signed by state government departments and an industry group where there is a stated goal to reach a specific environmental target For example in the early 1990s there was a voluntary agreement with the EPA Victoria and companies in the Altona Chemical Complex in the western suburbs of Melbourne (which includes Australian Vinyls BASF Dow Chemicals and Qenos) to reduce hydrocarbon emissions by 50 within a specified timeframe The target was met and further emissions reductions were negotiated The NSW EPA-Oil industry petrol volatility agreement outlined below is another example of a target based program

44 NSW EPA-Oil Industry Memorandum of Understanding on Summer Petrol Volatility

In 1998 NSW established arrangements for the supply of low volatility petrol in summer in the Sydney Greater Metropolitan Region implemented through a Memorandum of Understanding between the then EPA and oil companies The principal reason for controlling petrol volatility in summer is to reduce evaporative emissions of VOCs (from vehicles and production and storage sites) which contribute to ozone formation

The Memorandum of Understanding operated over four summer periods from 1998 to 2002 and involved companies voluntarily reducing petrol volatility (measured in kilopascals (kPa) of vapour pressure) over three summer periods from a base of 76kPa to 70kPa in the first summer 67kPa in the second and 62 kPa in the last two years

Although the Memorandum of Understanding was successful in progressively reducing petrol volatility over the period of its operation it was not supported by all industry members Consequently agreement was reached with industry that summer petrol volatility limits should be regulated to ensure a level playing field for all industry participants and regulated limits will apply from the summer of 200405

69

5 Summary of Australian Benchmark Programs

Program National State

Summary of Approach Impact

Voluntary Programs Altona Chemical Complex (Vic)

Local Small industry group worked towards self determined targets

Very high

Energy Star National Standards based label Limited Gas appliance Rating Scheme

National Industry operated labelling scheme with stars assigned therefore has graded benchmarksminimum performance standards out dated web database being developed

Low

National Industry Reduction Agreement

National Small industry group worked towards negotiated targets

High

NSW EPA-Oil Industry MOU

State Small industry group worked towards negotiated targets but not all involved ndash lead to regulations

Moderate

Top Energy Saver Award

National Achievement based label Limited

Quasi Regulatory Green Vehicle Guide

National Well promoted web database star ratings assigned therefore has graded benchmarks data provided voluntarily but backed by ADR requirements

High

Stand-by power National Required to achieve voluntary targets or regulation will be introduced

Unknown

National Packaging Covent

National Performance based targets backed by legislation High

Regulatory Energy Efficiency Labels

National Labelling scheme with stars assigned therefore has graded benchmarksbased on Australian Standard web database

High

MEPS National Sets base benchmark and works with energy rating

High

WELS Scheme National Labelling scheme with stars assigned therefore has graded benchmarksbased on Australian Standardweb database

High

Wood heaters State Only one benchmark assigned regulations are not uniform

Moderate

authorrsquos assessment based on direct or indirect knowledge of these programs

70

Appendix 3 Productivity Commission Comments on Labelling and Minimum Performance Standards

The Productivity Commission an independent agency which is the Australian Governmentrsquos principal review and advisory body on microeconomic policy and regulation recently examined the cost effectiveness of improving energy efficiency As part of its review lsquoThe Private Cost Effectiveness of Improving Energy Efficiencyrsquo it examined labelling programs minimum mandatory energy efficiency requirements and other means of providing consumer information The final report contains some highly relevant material that is applicable to establishing a benchmarking scheme for small engines

The following is a summary of relevant conclusions from the Inquiry

Government Operated Labelling Schemes

From consumer research provided to the Commission it concluded that ldquothere is some evidence to suggest that consumers are now paying more attention to labels than they have in the pastrdquo

The Commission was positive about labelling programs as labels

bull directly address ldquoa source of market failure mdash the asymmetry of information between buyers and sellers of energy-using productsrdquo

bull provide information to the consumer that is readily-accessible and easily-understood and therefore can assist in helping the consumer make better-informed choices

bull are likely to have produced net benefits for consumers

bull do not directly limit consumer choice

bull could provide a greater incentive for suppliers to sell products that use energy cost effectively

bull probably produced net social benefits

bull are most suited where there is a wide spread in the range of performances of comparable appliances and where information failures are most pronouncedrdquo

bull can be used to warn consumers that an appliance is very inefficient (through a disendorsement label) which could be effective in discouraging but not preventing consumers from buying the poor performing product

The Commission was supportive of Governmentrsquos role of drawing together and packaging information through labelling programs as this ensures that ldquorelevant and trusted information gets to those who would otherwise not get itrdquo In material reviewed by the Commission George Wilkenfeld and Associates and Energy Efficient Strategies (1999) claimed that labelling is unlikely to be effective if purchasers rarely inspect appliances in a showroom where they can compare performance across

71

different models or the purchaser is not the ultimate user and so has little interest in operating costs

Labelling programs involves both administration and compliance costs such as those incurred by suppliers in having their products tested but the Commission considered that labels should be more actively considered as an alternative to minimum performance standards

Minimum Performance Standards

Governments can prevent the sale of inefficient products by using minimum standards for example the Minimum Energy Performance Standards (MEPS) that apply to appliances such as refrigerators and freezers air conditioners and electric water heaters If appliances do not meet the minimum standard they cannot be sold in Australia Some appliances are covered by both MEPS and by labelling (for example refrigerators)

The Commission considered that MEPS and labels can be complementary as MEPS act to penalise the worst energy performers whereas labels rewarding the better performers

Costs comparisons of schemes

The Department of the Environment and Water Resources provided details about the costs involved in administering both the labelling scheme and the minimum performance standards for energy programs It stated that

bull the administration costs of MEPS are substantially lower than for labelling but the compliance costs can be higher

bull MEPS can have a greater cost for suppliers than labelling since suppliers must adjust their model ranges to meet the MEPS levels by the given date These compliance costs are however influenced by the lsquolead inrsquo time between the introduction of the regulatory proposal and the implementation of the MEPS

bull it is estimated that the administration costs for MEPS would be $3 million over the period 2000ndash15 compared to $39 million for labelling (in present value terms) (George Wilkenfeld and Associates and Energy Efficient Strategies 1999) Furthermore it was assumed that 84 per cent of administration costs were borne by appliance purchasers with the remainder borne by governments

It estimated that MEPS would increase the cost of appliances by $266 million over 2000ndash15 compared to $688 million for labelling (the latter cost being due to consumers voluntarily purchasing more efficient appliances)

72

Page 12: Outdoor Garden Equipment - Department of the Environment

1 Introduction

This report sets out the results of a project to compare and benchmark emissions from engines used in outdoor garden equipment that were available for sale in Australia during 2006 Possible outcomes from the project range from consumer guidelines for selecting low emission engines to regulatory controls on emissions There are currently no state or national regulations that directly control emissions from these engines

The project was commissioned by the Commonwealth Department of the Environment and Water Resources on behalf of state and territory government departments working on reducing the impacts of small engine emissions This report was prepared in consultation with an Expert Panel that included representatives from the Outdoor Power Equipment Association (OPEA)

11 Emissions from outdoor garden equipment engines

Small engines particularly conventional two stroke engines used in applications such as outdoor garden equipment are high polluters relative to their engine size and usage1 These small engines emit volatile organic compounds (VOCs) and oxides of nitrogen (NOx) which contribute to ozone (photochemical smog) formation in summer They also emit particles carbon monoxide (CO) and a range of air toxics such as benzene The USA California Canada and Europe and regulate emissions of VOCs NOx carbon monoxide and particle emissions from outdoor garden equipment

There are five types of spark-ignition engines that can be used in outdoor garden equipment

bull two stroke with carburettor (2c)

bull two stroke with pre-chamber fuel injection (2i)

bull two stroke with direct fuel injection (2di)

bull four stroke with carburettor (4c)

bull four stroke with fuel injection (4i) (includes direct injection)

Carburettor and pre-chamber fuel injection two stroke engines are inherently more polluting than the other three types This is due to their inability to completely separate the inlet gases from the exhaust gases resulting in up to 30 of the fuel being left unburnt and the need to add oil to the fuel to lubricate the engine (four stroke engines have separate reservoirs for fuel and oil) However twostroke carburettor engines typically weigh less than a four stroke engine of the same power and this tends to make them attractive for handheld equipment They also tend to have fewer components are generally cheaper to purchase and are cheaper to maintain than

1 Outdoor equipment covered in this report are engines less than 19kW

1

four stroke motors Victa Lawncare is currently undertaking research and development to improve the environmental performance of two stroke carburettors and while some emission improvements have been made a two stroke compliant with US or European standards is still considered several years away

Four stroke carburettor engines are generally quieter more fuel efficient and are less polluting than conventional two stroke engines

Direct fuel injection (dfi) either two stroke or four stroke overcomes the unburnt fuel problem and can meet the stringent regulated exhaust emission limits that apply overseas However there is not any evidence that dfi engines are being used in outdoor garden equipment available in Australia It appears that engines used in outdoor garden equipment in Australia are generally restricted to two and four stroke carburettor engines

Small engines are not as advanced in environmental terms as motor vehicle engines As a result even the better-performing small engines emit far greater quantities of pollutants per hour than typical modern car engines For example the US Environmental Protection Agency (USEPA) 2002 limit for a typical 4 kilowatt (kW) lawnmower motor is about 66 grams (g) of regulated pollutants per hour of operation A typical 08kW brushcutter sold new in 2002 emitted about 160grams of pollutants per hour - reducing to 40grams per hour if bought new in 2006 The equivalent limit for cars under Australian Design Rule 79 is about 16g per hour In other words operated over a similar time one hour of operation of a brushcutter that meets USEPA 2002 limits produces the same pollution as ten cars and a 4kW lawnmower the same pollution as four cars These comparisons are subject to differences in test methods but they do provide an indication of the disproportionate amount of pollution emitted by small engines

Engines that do not comply with current USEPA requirements are likely to emit several times the amount of pollution calculated in the above example Therefore the worst performing engines are likely to emit some ten times the emissions of the best performers

Because of the combustion of oil these engines also emit high levels of particles Although small engines only contribute a small amount to total particle emissions the rate of particle release compared to other engines can be very high For example lawnmowers can emit over 10 times more particles (in terms of grams per hour) than a petrol motor vehicle (manufactured between 1994 and 2001)

All the above emission comparisons between outdoor garden equipment engines and motor vehicles are subject to differences in test methods but they indicate the disproportionate amount of pollution emitted by small garden equipment engines It also needs to be recognised that motor vehicles in Australia average more than 15000 kilometres per year (ABS 2003) while the annual average use of outdoor garden equipment is around 25 hours for a lawnmower and less for other types of equipment Commercial operators however are likely to have a much higher usage rates than the general public

2

This paper examines the Australian market for small engines used in lawnmowers and handheld garden equipment their impact on air quality relevant overseas regulations and their applicability to Australia and makes recommendations to reduce air quality impacts from these engines

A wide range of information sources has been referenced for this report including data and information supplied by manufacturers distributors and dealers in small engines

3

2 Air Quality and Outdoor Garden Equipment Engines

Emission inventories make estimates of emissions of substances from a multitude of sources into airsheds The National Pollutant Inventory (NPI) which is run cooperatively by the Australian state and territory governments contains data on 90 substances that are emitted to the Australian environment The substances included in the NPI have been identified as important because of their possible health and environmental effects Industry facilities estimate their own emissions annually and report to states and territories Non-industry (or diffuse) emissions estimates which includes emissions from outdoor garden equipment are made by the states and territories on a periodic basis using information sources such as surveys databases and sales figures

The NPI only reports emissions from domestic lawn mowing and for a few airsheds the contribution made by public open space lawn mowing It does not report on the contribution made by other types of outdoor garden equipment such as brushcutters National and selected state NPI emissions estimates for the common air pollutants and for Air Toxics NEPM pollutants from domestic lawn mowing are summarised in Table 1 It should be noted that national emissions from lawn mowing are underestimates as the NPI records emissions for major airsheds only and therefore is not Australia wide plus the estimates do not include evaporative emissions from fuel tanks and hoses

This NPI data is indicative only as the accuracy and completeness of the data sets varies across airsheds and is reliant on the estimation techniques used For example while the population in the NSW is higher than other airsheds its emissions look disproportionally high when compared to the other airsheds This could be because the estimation technique varies or it is due to some other factor

4

Table 1 National Pollutant Inventory Domestic Lawn Mowing Emission Estimates

Substance Port Phillip

Population 34 mill (1996)

SE Qld

Population 23 mill

NSW GMR

Population 47 mill

Adelaide

Population 10 mill

National

Common Air Pollutants (tonnesyear)

Carbon monoxide 12000 12000 24000 6100 69000

Total Volatile Organic Compounds 3600 3800 7000 2000 21000

Particulate Matter 100 um 86 94 170 9 460

Sulphur dioxide 5 5 9 50 81

Oxides of Nitrogen 63 54 120 24 330

Air Toxics (tonnesyear)

Benzene 230 210 390 130 1200

Formaldehyde 56 38 NA 31 180

Polycyclic aromatic hydrocarbons 07 11 21 04 41

Toluene (methylbenzene) 370 360 660 210 2000

Xylenes (individual or mixed isomers) 270 260 490 150 1500

Analysis of the NPI database at the national level shows that domestic lawn mowing is the

- Fourth largest source of benzene contributing 7 to the total reported airshed load

- Fourth largest source of formaldehyde contributing 3 to the total reported airshed load

- Fifth largest source of xylene contributing 6 to the total reported airshed load

- Fifth largest source of toluene contributing 6 to the total reported airshed load

- Sixth largest source of carbon monoxide contributing 12 to the total reported airshed load

- Ninth largest source of VOCs contributing 3 to the total reported airshed load when biogenics (natural sources such as trees and soil) are excluded

The NSW Department of Environment and Conservation has been upgrading its emissions inventory Based on 2003 emissions data non-road anthropogenic sources

5

contribute 619 of the VOCs to the GMR airshed Preliminary results2 indicate that VOC emissions from domestic and public open space lawn mowing contributes on an annual average 41 of all VOC emissions in the GMR On a typical weekend during warmer weather this percentage rises to 11

Therefore it could be assumed that lawn mowing could contribute approximately 4 on average to VOC emissions from anthropogenic sources in major airsheds in Australia when public open space lawn mowing is included This percentage is likely to rise significantly in the warmer spring and autumn weekends which is when lawns and other vegetation grow faster and when more people garden

21 Air Quality Standards

In June 1998 the National Environment Protection Measure for Ambient Air (Air NEPM) established national uniform standards for ambient air quality for the six most common air pollutants ndash carbon monoxide nitrogen dioxide photochemical oxidants (measured as ozone) sulfur dioxide lead and particles less than 10 microns (PM10) The NEPM was varied in 2003 to include PM25 advisory reporting standards and in April 2004 a National Environment Protection Measure for Air Toxics was adopted

Nationally the common pollutants of most concern (particularly in major urban areas) are fine particles and ground level photochemical smog (measured as ozone) which is formed in the warmer months when volatile organic compounds (VOCs) and oxides of nitrogen (NOx) react in the atmosphere under the influence of sunlight in a series of chemical reactions

Recent health studies (cited in NEPC 2005) have strengthened the evidence that there are short-term ozone effects on mortality and respiratory disease The studies also strengthen the view that there does not appear to be a threshold for ozone below which no effects on health are expected to occur In recent years Australian epidemiological studies have been conducted which confirm the results of overseas studies that there is a relationship between elevated ozone levels and hospitalisations and deaths from certain conditions

There are two national ozone standards a one hour standard of 010ppm and a four hour standard of 008ppm with a goal that allows for one exceedance per year by 2008 Sydney experiences a number of days each year of ozone levels above these standards In 2003 Sydney exceeded the one hour standard on 11 days in 2003 19 days in 2004 and 9 days in 2005 The four hour standard was exceeded on 13 days in 2003 19 days in 2004 and 13 days in 2005 Further reductions in VOC and NOx emissions are needed to reduce ozone concentrations in Sydney to levels that would comply with the Air NEPM

The other jurisdictions meet or are close to meeting the current National Environment Protection (Ambient Air Quality) Measure (Air NEPM) ozone standards (NEPC 2005) However the ozone standards are being reviewed and based on current human health evidence the argument appears to be strengthening for tighter ozone standards

2 Presentation to Expert Panel 27 April 2006 by Nick Agipades Manager Major Air Projects NSW DEC

6

Should a stricter standard or an eight-hour standard consistent with international standardsguidelines be adopted achievability of Air NEPM ozone standards or goals could become an issue for some of the other major urban airsheds (NEPC 2005)

Modeling of ozone for Sydneyrsquos Greater Metropolitan Region (GMR) indicates that the implementation of Euro emission limits for on-road vehicles and hence the increased presence of these less polluting vehicles in the fleet and retirement of old more polluting vehicles from the fleet is not sufficient to meet the current NEPM goals Modeling suggests that very large reductions in precursor emissions would be required to meet the current ozone one hour goal (NEPC 2005)

Even when the effects of bushfires and when hazard reduction burning are taken into consideration airsheds such as Launceston Melbourne and Sydney struggle to meet the national standards for particles (EPA 2006) However outdoor powered equipment predominantly from two stroke engines makes only a minor contribution to ambient fine particle loads

While carbon monoxide emissions from engines used in outdoor garden equipment are regulated overseas air monitoring in Australia indicates that carbon monoxides levels are well below the national air quality standards and there are no pressing issues requiring CO from outdoor powered equipment to be regulated In addition data indicates that lowering emissions of VOCs and NOx from small engines reduces CO emissions

Many of the pollutant sources which contribute to the formation of ozone and to particle levels also contain air toxics such as benzene toluene formaldehyde and xylenes These air toxics have been shown to be responsible for a range of health problems including asthma respiratory illnesses and cancer The National Environment Protection Measure for Air Toxics requires each jurisdiction to monitor and report annually on five air toxics benzene polycyclic aromatic hydrocarbons formaldehyde toluene and xylenes The monitoring data is intended to inform future policy and also the public on ambient levels of these air pollutants Monitoring of air toxics to date shows that levels are low and below the national monitoring investigation levels (EPA Vic 2006 DEC 2006)

7

3 Emission Standards for Small Engines

31 Australia

At present there are no Australian regulations or standards to limit air pollutant emissions from small (two and four stroke) engines Australia does benefit to some extent from overseas regulations as many lawnmowers and other gardening equipment sold in Australia have engines manufactured in the United States or Europe where strict standards apply

32 United States

In the United States emission regulations set by the United States Environmental Protection Agency (USEPA) and the Californian Air Resources Board (CARB) apply to lawn mowers and other powered gardening equipment Although CARB standards currently tend to be stricter than USEPA standards by 2006 emissions limits applying under the two standards will be very similar

United States Environment Protection Agency (US EPA)

In 1995 the USEPA introduced ldquoPhase 1rdquo regulations covering small non-road engines with a power of not more than 19kW (25HP) The regulations applied to equipment manufactured from 1997

These regulations have seven classes of equipment based on portability and engine displacement volume (ldquocapacityrdquo) In March 2000 the USEPA published ldquoPhase 2rdquo regulations which are shown in Table 2 These set limits for combined emissions of hydrocarbons (HC) and oxides of nitrogen (NOx) and separate limits for carbon monoxide (CO) emissions and for two stroke engines only particles

Table 2 US EPA Phase 2 Small Engine Emissions Standards (HC+NOx in gkW-hr) (a) (b)

Small Engine Class

Type 2002 2003 2004 2005 2006 2007+

I-A (lt66cc) Non-handheld (eg lawnmowers)

- 161 161 161 161 161

I-B (66 to lt 100cc) - 161 161 161 161 161

I (100 to lt 225cc) - 161 161 161 161 161

II (225cc or more) 180 166 150 136 121 121

III (lt20cc) Handheld (eg trimmers)

238 175 113 50 50 50

IV (20 to lt50cc) 196 148 99 50 50 50

V (50cc or more) - - 143 119 96 72 (a) As carbon monoxide (CO) levels in Australia are well below the Air NEPM standard the

USEPA emission limits for CO have not been included in this table (b) Includes useful life criteria of 50125300 hours

8

When the USEPA introduced ldquoPhase 2rdquo regulations it included averaging banking and trading provisions (ABT) which were seen ldquoas an important element in making stringent Phase 2 emissions standards achievable with regard to technological feasibility lead time and costrdquo (USA 1999) The USEPA also claimed (USA 2000) that the ABT program secures early emissions benefits through the early introduction of cleaner engines

ABT provisions which apply to handheld and non handheld engines are complex but in broad terms averaging means the exchange of emission credits among engine families within a given engine manufacturerrsquos product line This allows a manufacturer to produce some engines that exceed the standards and offsetting these exceedances with emissions from engines that are below the standard Manufacturers are allowed to exchange credits from handheld to non handheld and vice versa Banking means the retention of emission credits by the engine manufacturer generating the credits for use in a future model year (for averaging or trading) Trading is the exchange of emission credits between engine manufacturers which then can be used for averaging purposes banked for future use or traded to another engine manufacturer

In January 2004 USEPA reported that in 2002 averaging was being used but there was very little use of banking It determined that the initial ABT programs as too complex and included discount rates on credits ABT was simplified in 2004 including the elimination of credit discount and multipliers and limits on credit life To date there has reportedly been limited use of banking however it is anticipated that there will be more widespread use of banking credits if the USEPA proposed Phase 3 comes into effect3 (see below)

Particulate limits (2gkW-hr) also apply to two stroke engines Carbon monoxide and durability limits (or useful life) are also prescribed The durability criteria which were introduced in Phase 2 require that the emission limits must be met through the useful life of the engine The manufacturer determines useful life of each product using standardised product testing procedures and then based on the test results selects the useful life category for each product which can be 125 250 or 500 hours These durability criteria acknowledge the large disparity in usage patterns by equipment type and between commercial and residential users It also takes into account the ability of manufacturers to design and build engines for various design lives and which fit the types of equipment engine is produced for

The March 2000 USEPA report (USEPA 2000) estimated that the expected effects of the Phase 2 regulations would be

bull A 70 reduction in HC+NOx beyond the Phase I standards (which were estimated to have reduced emissions by 32 from the unregulated baseline)

bull A 30 reduction in fuel consumption of small handheld equipment bull Price increases of between $US23 (Class III) and $US56 (Class V) for

handheld equipment

3 Dave Gardner Briggs and Stratton email 22506

9

The US EPA is currently considering lsquoPhase 3rsquo regulations which are catalyst based standards to further reduce exhaust HC and NOx emissions from non handheld engines reduce evaporative HC and NOx emissions for both handheld and non handheld engines plus include extended durability criteria These limits are currently at discussion stage only They align with CARB Tier 3 but a longer lead time is proposed

Table 3 Proposed Phase 3 Exhaust Emissions

HC+NOx gkW-hr

CO gkW-hr

Year Useful life hrs

Class I 100 610 2010 125250500

Class II 80 610 2011 2505001000

Class III-V No changes

HC+NOx std is based on averaging

Californian Air Resources Board (CARB)

Spark ignition engines

CARB regulations first introduced emission limits for small engines manufactured from1995 The more recent schedule of emission limits are shown in Table 4 These limits depend solely on the engine capacity and apply to both handheld and non handheld classes

Table 4 CARB Emission Limits for Small Engines (HC+NOx in gkw-hr)

Engine Capacity 2000-2001 2002-2005 2006+

65cc or less 72 72 72

gt65cc to 225cc 161 161 161

gt225cc 134 121 121

California has particle limits for two strokes useful life criteria and mandatory engine labeling including a consumer advisory hang tag as shown in Figure 1 The USEPA is also considering introducing an air index label

10

Figure 1 Example of a Californian Consumer Advisory Hang Tag The Californian regulations take into account sales weighted emission performance for families of engines An engine family is essentially the same engine being used in different equipment items

In 2003 California adopted a Tier 3 program for exhaust and evaporative emissions and these are based on the use of catalytic convertors The engine classes better align with US EPA categories however the exhaust standards for Class I and Class II are more stringent than the existing US EPA standards

Table 5 CARB Tier 3 for Exhaust Emissions

Model Year Displacement Category

Durability Periods (hours)

HC+NOx gkw-hr

CO gkw-hr

Particulate gkw-hr

2005 and subsequent

lt50 cc 50125300 50 536 20 + 50-80 cc inclusive 50125300 72 536 20 +

2005 gt80 cc - lt225 cc Horizontal-shaft eng

125250500 161 549

gt80 cc - lt225 cc NA 161 467 Vertical-shaft Engine 225 cc 125250500 121 549

2006 gt80 cc - lt225 cc 125250500 161 549 225 cc 125250500 121 549

2007 gt80 cc - lt225 cc 125250500 100 549 225 cc 125250500 121 549

2008 and subsequent

gt80 cc - lt225 cc 125250500 100 549 225 cc 1252505001000 80 549

the 1000 hours is applicable for 2008+ Model Year (MY) + applies to 2 stroke only Source California Exhaust Emission Standards and Test Procedures For 2005 And Later Small Off-Road Engines Adopted July 26 2004 effective on October 20 2004

California also has Blue Sky provisions These are voluntary standards for engines that meet the criteria shown in Table 6 Blue Sky Series engines are not included in

11

the averaging banking and trading program Zero-emission small off-road equipment (eg push mowers) may certify to the Blue Sky Series emission standards

In 2005 CARB aligned its test procedures with the USEPA

Table 6 CARB Blue Sky Provisions

Model Year Displacement Category

HC+NOx gkw-hr

CO gkw-hr

Particulate

2005 and subsequent lt50 cc 25 536 20

50 - 80 cc inclusive 36 536 20

2007 and subsequent gt80 cc - lt225 cc 50 549

2008 and subsequent 225 cc 40 549 Applicable to all two stroke engines

33 Canada

The Canadian small engine market has similarities to the Australia market the majority of small engines are imported from the USA and there is one Canadian manufacturer of small spark ignition engines and one major manufacturer of lawn and garden machines

A Memorandum of Understanding (MOU) which came into effect on 1 January 2000 was signed between Environment Canada and ten manufacturers of handheld equipment and nine manufacturers of engines used in non handheld machines The MOU was intended as an interim measure until regulations could be put in place Under the MOU the manufacturers agreed to voluntarily supply small spark ignition engines designed to meet the applicable USEPA Phase 1 emission standards

In 2003 Canada regulated emission limits for handheld and non-handheld small engines based on USEPA emission limits The regulations apply to model years 2005 and later While there are no separate averaging banking and trading provisions in Canadian regulations Canada allows any USEPA certified engine to be sold in Canada This means that engines that do not meet the standard level but are averaged (or use credits) in the United States can be sold in Canada Manufacturers are required to produce upon request evidence of conformity to the standards and are required to provide written instructions on engine maintenance to the first retailer

12

Table 7 Canadian Small Spark-Ignition Engine Exhaust Emission Standards

Engine class

Engine Type

Engine Displacement (cm3)

Effective date (model year)

Standard HC+NOx (gkWshyhr)

Standard NMHC+NOx (gkW-hr)

Standard CO (gkWshyhr)

I-A Non-handheld lt66 2005 and

later 50a -shy 610a

I-B Non-handheld

lt100 and 66

2005 and later

40a 37a 610a

I Non-handheld

lt225 and 100

2005r 161b 148a 519b 610a

II Non-handheld 225 2005 and

later 121a 113a 610a

III Handheld 20 2005 and later 50a -shy 805a

IV Handheld lt50 and 20 2005 and later

50a -shy 805a

V Handheld 50 2005 2006 2007 and later

119a 96a

72a

-shy-shy

-shy

603a 603a

603a a Standards apply throughout the engine useful life b Standards apply only when the engine is new Source Canada Gazette Part II Vol 137 No 24 2003-11-19

34 Europe

In 1998 the European Union introduced exhaust emission limits for small petrol engines through Directive 9768EC and in 2002 introduced amendments through Directive 200288EC The limits in the Directives align with the US regulations however they do not have averaging and banking provisions

Table 8 European Emissions Standards

Small Engine Class Type (HC+NOx in gkW-hr) 2004 2005 2006 2007 2008

SN1 (lt66cc) Non-handheld (eg lawn mowers)

161 161 161 161 161

SN2 (66 to lt 100cc) 161 161 161 161 161

SN3 (100 to lt 225cc) - - - 161 161

SN4 (225cc or more) - - 121 121 121

SH1 (lt20cc) Handheld (eg trimmers)

- - - 50 50

SH2 (20 to lt50cc) - - - 50 50

SH3 (50cc or more) - - - - 72

13

The European Union is currently considering including useful life criteria and averaging and banking provisions plus it is considering introducing a Directive to further reduce emissions from diesel engines The objective of the proposal is to tighten emissions standards for engines in general non-road applications in light of technological developments and it taking into account the parallel developments for similar legislation in the United States in order to harmonise the environmental standards and to facilitate trade

Charts comparing the USA Californian and European Emission Limits are shown below

14

35 Summary of Regulations for Non Handheld Equipment

KEY TO CHARTS

USEPA CARB EU

0

10

20

30

40

50

60

70

80

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

0 to 49cc

0

10

20

30

40

50

60

70

80

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

50 to 65cc

0

2

4

6

8

10

12

14

16

18

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

100 to 224cc

0

2

4

6

8

10

12

14

16

18

20

2000

2002

2004

2006

2008

Year Model

HC

+N

Ox g

kW

-hr

225cc and over (up to 19kW)

15

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

36 Summary of Regulations for Handheld Equipment

KEY TO CHARTS

USEPA CARB EU

20 to 49cc 0 to 19cc

250 250

200

150

HC

+N

Ox g

kW

-hr

100

200

HC

+N

Ox g

kW

-hr

150

100

50 50

0 0

Year Model Year Model

50 to 65cc 66 to 80cc

160

160

140

140

120

40 40

20 20

0 0

120

HC

+N

Ox g

kW

-hr

HC

+N

Ox g

kW

-hr

100100

8080

60 60

Year Model Year Model

16

Summary of Regulations for Handheld Equipment (continued)

KEY TO CHARTS

USEPA CARB EU

0

20

40

60

80

100

120

140

160

2000

2001

2002

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

81 to 224cc

0

20

40

60

80

100

120

140

160

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

225cc and over (up to 19kW)

17

4 Australian Market for Small Engines

41 Likely compliance with overseas emissions standards

As part of this assessment an environmental profile of equipment currently on the Australian market has been developed initially based on information from manufacturersrsquo brochures and web sites and industry magazines and then confirmed through follow-up with relevant industry contacts

Each item of equipment has been assessed on its compliance with USEPA CARB or European regulations In most cases it was not possible to match models available on the Australian market with CARB lists (CARB publishes exhaust emissions data on all appliances on its web site) This was mainly due to the inconsistency of model designations and uncertainty about ldquoengine familiesrdquo

Engine characteristics and retail price were difficult to obtain Some brochures also made claims of compliance with USEPA European or CARB requirements The detailed breakdown of current equipment on the Australian market is given in Appendix 1

The majority of small engines sold in Australia are imported and many come from countries that impose emission limits The extent of imports into Australia that do not comply with the country of origin standards is not known Industry estimates that 40 of garden products are sold through importers who are not linked to manufacturers of US EPA or European certified equipment and the source of some products sold here is difficult to establish Victa is the only company producing small engines in Australia Its iconic 2-stroke lawnmower currently cannot meet overseas emission limits

Outdoor Power Equipment Association (OPEA) assisted in identifying the Australian distributors of most brands of powered garden equipment In April 2006 a survey form was sent to a total of 43 distributors representing 97 brands of equipment The survey form sought information about the engine for all petrol-fuelled garden equipment with a power not more than 19kW

Figure 2 Extract from survey form

18

Initial response to the survey was poor Despite follow-up action and efforts from the industry association at the beginning of September 2006 26 distributors had responded to the survey information and only 13 distributors provided all data necessary for benchmarking purposes This resulted in emission compliance data for about half of the estimated products on the Australian market Attempts to match Australian models with the database maintained by the Californian Air Resources Board were also of limited success due to inconsistencies in model designations between Australia and the USA and the manner in which model information is coded in the CARB database

Table 9 Summary of distributor responses

Responses status Not OPEA OPEA ALL

Number of responses 9 8 (31) 17 (40)

Response - all data 4 9 13 (30)

Response - extra time sought 3 3 (7)

Response - no petrol products 4 1 5 (12)

Response - some data 5 5 (12)

Grand Total 17 26 43 percentages may not add to 100 due to rounding

Of the 97 brands initially identified

bull 16 brands are apparently no longer sold in Australia

bull No responses were received for 29 brands

bull Partial data were received for 12 brands

bull All data was available for 30 brands

Table 10 Summary of responses by brand

Count of brands

Analysis status Not OPEA OPEA All

Missing some data 12 12

No data received 9 (27) 20 (31) 29 (30)

No longer sold 13 3 16

Response - no models to list 3 7 10

Response received (electronic form) 5 11 16

Response received (paper form) 3 2 5

Response received (spreadsheet) 9 9

All 33 64 97

A 2004 report for the NSW DEC estimated that there were about 1200 eligible garden

19

products in the Australian market The current project has obtained data for a total of 870 products or 72 of the estimated population In addition the sampling method is likely to be biased towards products with good environmental performance In these circumstances the following analysis should be regarded as indicative only

Survey results

The following tables and figures show expected compliance with European CARB or USEPA requirements based on the limited information provided by industry

Table 11 Engine type and compliance with overseas standards Count of products Engine type

Best STD 2c 4c Unknown All 1997 - US EPA I 53 32 85 (10) 200288EU 17 17 (2) 2004 - US EPA II 1 3 4 (lt1) 2004 EURO I 8 8 (1) 2005 - US EPA II 10 29 5 44 (5) 2006 - US EPA II 107 141 2 250 (29) 2006 EURO I 6 6 (1) 2007 - US EPA II 1 1 (lt1) 2007 Euro II 2 2 (lt1) None 118 90 208 (24 Unspecified 24 60 161 245 (28) All 344 358 168 870

Unknown means the type of engine is unknown (but is most likely to be 2c) Unspecified means that the status of emissions compliance was unable to be identified None means the manufacturerdistributor has indicated that the equipment does not comply with any overseas emissions standard

Figure 3 Compliance with overseas standards - all surveyed products Note Unknown in chart includes unspecified and unknown from Table 11

20

Figure 4 Compliance with overseas standards by equipment type ldquoPhase 1 equivrdquo means the engine complies with US EPA phase 1 or 200288EU ldquoPhase 2 equivrdquo means the engine complies with US EPA Phase 2 Euro I or Euro 2 ldquoUnknown means that engine cycle (stroke) was not provided

Of the 41 categories of equipment in the survey 15 had at least 10 current products Results for these categories are set out below

Figure 5 Engine type for popular categories

21

Figure 6 Compliance with overseas standards for popular categories ldquoPhase 1 equiv means the engine complies with US EPA phase 1 or 200288EU Phase 2 equiv means the engine complies with US EPA Phase 2 Euro I or Euro 2 ldquoUnknown means that engine cycle (stroke) was not provided

42 Australian Sales of Outdoor Powered Equipment

The Australian Outdoor Power Equipment Association (OPEA) whose membership represents about 80 of the manufacturersdistributors and dealers in the industry commissions regular independent industry audits of garden equipment sales (OPEA personal communications) Sales data from OPEA is shown in Table 12

22

Table 12 Sales of outdoor garden equipment 2002 and 2005-06 2005-06 2 stroke (1000)

2002 2 stroke (1000)

2005-06 4 stroke (1000)

2002 4 stroke (1000)

2005-06 TOTAL (1000)

2002 TOTAL (1000)

Walk behind mowers 72 170 351 76 424 246

Brushcuttertrimmer 321 12 17 180 339 192

Chainsaws 152 0 0 90 152 90

Chipper shredders 0 60 46 0 46 60

Blowerblower vacuums 98 0 11 50 109 50

Ride on mowers 0 25 51 0 51 25

Generators 11 32 96 0 107 32

Hedge trimmers ampothers 40 192 0 28 40 220

694 491 476 424 1267 915

for total sales 593 463 407 537

for mowers 152 280 848 720

According to OPEA approximately 424000 walk behind lawnmowers and more than 792000 units of outdoor handheld equipment were sold in Australia in 2005-06 In addition there were sales of about 80000 replacement engines and 70000 pumps in 2005-06 most of which were four strokes These figures show that there has been considerable growth in the sales of most products with the exception of chipper shredders and the category lsquohedge trimmers and othersrsquo whose sales declined in 2005shy06 compared with those in 2002 About 17 of walk behind lawnmowers were two stroke and 83 four stroke which is an improvement in the uptake of cleaner engines when compared to 2002 when about 30 were two stroke The situation with handheld equipment is reverse with nearly 79 being two strokes compared to 47 in 2002 However many models of two stroke handheld equipment meet current US emission standards and care should be exercised in using engine type (two stroke or four stroke) as an indicator of emissions performance for this class of equipment

The OPEA 2005-06 sales estimates are shown in Figure 7 OPEA cautions that there is considerable uncertainty about the estimates for brushcutters and blowerblower vacuums as OPEArsquos figures only represent 50 and 60 respectively of sales of these products No estimates of future sales trends were identified during research for this project

23

Australian sales of 2 and 4 stroke outdoor equipment 2005-6

0 50 100 150 200 250 300 350 400

Walk behind mowers

Brushcuttertrimmer

Chainsaws

Chipper shredders

Blowerblower vacuums

Ride on mowers

Generators

Other

Annual sales (x 1000)

4s 2s

Figure 7 OPEA estimates of equipment sales in 2005-06 Note Blowervac is an industry term for equipment that combines blowing and vacuuming functions

Briggs and Stratton (Australia) who import engines from the USA supply the majority of the four stroke engines for handheld equipment sold in Australia and these comply with all the current USA and CARB regulations Imported handheld garden equipment is shipped fully assembled to a branch or distributor and is then sent to a retailer The retailer may or may not provide equipment servicing

OPEA members have expressed concern regarding the increasing sales of imported high polluting two stroke engines that allegedly do not meet any emission standards and come from countries that do not have emission standards One industry representative reported that some of the imported trimmers were being manufactured in China using outdated designs and tooling from two old bankrupt American companies and these are being sold here at about 30 of the price of traditional brands and very low cost generators from China now account for around 70 of total sales It is difficult to confirm this trend without undertaking a detailed examination of Australian import data however the significant increase in the sales of two stroke handheld equipment provides some support for this trend

On the other hand it is claimed by industry that the ride on mower market (predominately with compliant four stroke engines) has been stimulated by the Australian USA free trade agreement

24

5 Australian Users of Small Engines This section examines the market segments for garden equipment and customer purchasing behaviour

51 General Public

Purchasing behaviour

Research into consumer purchasing behaviour has found that consumers assess a product against a range of attributes for example price weight brand reputation servicing and parts availability warrantees and guarantees experience size promotions and discounts Studies have also revealed that up to 82 of Australians had bought products on the basis of social or environmental factors in the previous year (State Chamber of Commerce 2001) Related to this point the energy star rating ecolabel on whitegoods was viewed as a credible environmental claims system which is well regarded by the general consumer (Product Category Manager Mitre 10 personal communications)

As the purchase of small engine garden equipment by the general consumer is an infrequent purchase which carries a certain of amount of risk With small engines the risk can be functional risk (will not perform as expected) physical risk (for example safe features such automatic cut out on an electric lawn mower) or financial risk especially for the more expensive items The general consumer is likely to lessen the risk by seeking information and by evaluating the information on the available products over a period of time The consumer may also lessen the risk by

bull purchasing well known brands

bull buying the brand offering the best warrantees and guarantees

bull buying the most expensive brand and

bull buying a brand they have used before

Research indicates that the desired attributes of a product may not be well established at the start of a consumerrsquos search process but will often be refined as the consumer learns more about the product The consumer will also use a ranking and weighting process based on desired qualities and trade offs may be made

Reportedly purchases of engine operated garden equipment are based on price yard size fitness for purpose and other features such as weight and ease of starting (Product Category Manager Mitre 10 personal communications) Males are the predominant purchasers of garden equipment however because of changing demographics there has been an increase in the number of women purchasing these products

Less than 5 of lawnmowers purchased are push or electric mowers (Product Category Manager Mitre 10 and industry sources personal communications 2003)

25

Electric mowers are generally perceived as not being as effective as cords have limited range and rechargeable electric mowers require frequent recharging

There is a recent trend towards ride on mowers (all four strokes) probably because of changing demographics specifically older age groups moving to more rural environments with larger yards (OPEA personal communications)

A study (Wilkie 1994) investigated consumer appliance purchasing behaviour and found that the general consumer consulted a range of information sources before purchasing an appliance The appliance salesperson was found to be the most important information source for many consumers Other important information sources include newspaper advertisements friends and relatives catalogues consumer reports and brochureslabels Since Wilkiersquos study the internet will have become increasingly important as a research tool and in some instances as a way to purchase products As part of this study there is evidence of low priced products being sold into the Australian market via the internet only ndash a practice that is likely to increase in the future It was difficult to source any compliance or details on these products

At the retail chain level staff product training is generally voluntary undertaken out of store hours and as an inducement to attend training sessions suppliers usually provide incentives for staff Retail chain purchases are very price driven although some chains are reportedly interested in stocking goods that have credible environmental claims (Mitre 10 and other retail chain sources)

IBIS (2006a) reports that the domestic hardware sector which is dominated by Danks (Home Timber and Hardware Thrifty - Link Hardware and Plants Plus Garden Centre) and Bunnings is classified as a growth market and the sales of lawnmowers and other lawn and garden machinery and equipment represent about 14 of sales revenue

In summary it appears that a range of product attributes influences consumer purchases of lawnmowers and outdoor equipment Currently there is very little information about emissions in any of the information sources a consumer is likely to consult when purchasing these products Nevertheless surveys indicate that consumers are concerned about the environment and are open to including environmental considerations into their purchase decision Educating sales staff about the air emissions from lawnmowers and outdoor equipment together with ecolabels could therefore be important methods for influencing consumers towards the purchase of cleaner products

Equipment Usage

The USA Outdoor Power Equipment Institute CARB (cited in USEPA 1998) and the USEPA (USEPA 1998) have made estimates of annual usage rates and average life spans of outdoor equipment for the general consumer user and for the commercial user Table 13 gives USA usage and lifespan range for selected items of powered equipment

26

Table 13 USA Average Usage and Lifespan of Outdoor Garden Equipment For General Consumers and Commercial Users Equipment Annual usage (Hours) Lifespan (years)

General Consumer

Walk- behind mowers 20-25 6 -7

Rear engine ride on mowers 4 6 -7

Chainsaws 7 5-9

Leaf blowers 9-12 5-9

Trimmers 10 5-9

Commercial User

Walk- behind mowers 320 27

Rear engine ride on mowers 380 38

Chainsaws 405 1-13

Leaf blowers 170-293 18-28

Trimmers 170 - 275 15-28

Discussions with members of the Australian industry confirm that Australian hours of use are likely to be similar to the American estimates although this can vary depending on location For example in tropical areas lawns are mowed more often because they grow faster in this climate The American turnover of equipment is however probably higher than here as the Australian consumer tends to keep their equipment longer and so the useful life of a mower is more likely to be on average 10 ndash12 years

52 Garden and Ground Maintenance Services

According to a recent IBIS report (2006b) the revenue for this industry in 2005-06 was $383 million and the industry outlook is lsquobrightrsquo with a predicted annual average 5 growth over the next few years The Australian customer base for garden maintenance services including for lawn mowing is

Households 55 Business 25 Government 20

The sector is reportedly a growth industry due to

bull the aging population

bull the increasing numbers of households that are time poor income rich and

bull the growing trend for professional landscaping which requires a higher level of garden maintenance

27

The main customer base for these businesses includes middle to upper socioeconomic groups the aged and people who are physically disabled Growth is predicted particularly for the franchise industry with demand from the commercialindustrialgovernment sectors (IBIS 2003) A 1999 ABS survey reported that nearly one-third of older people purchased at least one domestic service per fortnight with gardening assistance being the most common This accords with an industry estimate that about 25 of householders pay someone to mow their lawn (Jim Penman Jimrsquos Mowing personal communication) The industry is sensitive to economic conditions and weather for example the drought has slowed growth over the last few years

The garden maintenance sector is dominated by small independent operators with two major franchisers Jimrsquos Mowing and VIP VIP nationally has 600 franchises and Jimrsquos Mowing about 400 Jimrsquos Mowing reportedly mows about 15000 lawns and has 53 of the market (IBIS 2006b) As franchised lawn mowing services represents about 14 of the lawn mowing services nationally it can be estimated that approximately 280000 lawns are mowed nationally by commercial operators

Jimrsquos Mowing and VIP provide training and advice to new franchisees on equipment including proper maintenance schedules Training generally occurs before franchisees purchase their equipment Most franchisees equipment would consist of two mowers a brushcutter an air blower and possibly a hedge trimmer or chain saw Operators prefer four stroke mowers and these are used for an average eight hours per week Brushcutters are generally two strokes as are other motors (IBIS 2006b and Jim Penman personal communication)

From the above it is estimated commercial operators operate mowers for up 34 million hours per year (or 8 of the total estimated mowing hours per year) and purchase approximately 66000 lawnmowers annually (25 of purchases) The sectorrsquos purchases of brushcutters is estimated to be approximately 8000 units per year or 37 of purchases Table 13 provides US commercial userrsquos annual average hours of use and average equipment life spans ndash it would be anticipated Australian rates would be similar

The main businesses contracting to provide ground maintenance services to the corporate and government sector (including universities) are Spotlessrsquos Open Space Management Transfield and Programmed Maintenance Services all of which are diversified publicly listed companies plus the Danish owned company ISS (previously Tempo Services) (IBIS 2003 and 2006b and company websites) The type of services they provide means it is likely they would have an array of equipment and a preference for the more powerful ride-on mowers and for Class V handheld equipment

53 Government Purchasing

The way purchasing decisions are made by government or other large organizations is generally very different to the approach taken by the general household consumer

bull many of the purchases are for large quantities of goods

28

bull there are well established policies and procedures in place to guide purchasing with the purchase criteria established early in the buying process and

bull those making the purchase are likely to be more knowledgeable about the product than the average consumer and they are usually not the eventual user of the goods

Value for money fitness for purpose ability to supply and over recent years environmental aspects are likely to be important factors in the purchasing decision for Government

Local State and Commonwealth Governments have responsibility for the upkeep of public assets many of which include public open space and other outdoors areas At the State and Federal level these include schools universities sporting facilities hospitals and defence facilities These services may be outsourced individual departments may undertake maintenance and purchase their own equipment or they may purchase equipment through a central purchasing facility With the central purchasing facility these items are generally purchased under contract While there is an increase in the inclusion of environmental considerations in the selection criteria for purchasing goods and services especially under contract these considerations mainly relate to waste management and recycling criteria and not air emissions

Local councils in some states for example NSW generally take responsibility for ground maintenance within their council areas or for some smaller councils the service may be contracted to a neighbouring council In other states such as Victoria there is a trend to outsource ground maintenance contracts to commercial providers

It is unknown what proportion of total sales that direct Government purchases represent however it likely to represent a relatively small share of several percent of the overall market

In summary

bull The general household consumer represents the major market segment for garden equipment accounting for up to 90 of product sales

bull Government is likely to be relatively small direct purchaser of garden equipment

bull Commercial garden services to households purchase approximately 25 of lawnmowers per year and 37 of brushcutters

bull Large ground maintenance companies are likely to prefer larger and more powerful equipment such as ride-on mowers

29

6 Result of Stakeholder Consultation

61 Regulations

The Small Engine Expert Panel ndash Outdoor Equipment considered in depth an approach to take to improve the emissions performance of outdoor garden equipment sold in Australia Discussions were particularly focused on the growing influence of cheap high emissions imported products together with the difficulties that the local manufacturer of lawn mowers is likely to face in complying with the relevant overseas standards As part of this process the industry representatives on the Panel held additional discussions and they consulted international industry experts at the manufacturing level in Europe the USA and Japan

OPEArsquos preference is for the adoption of regulations based on the USEPA standards with Phase 1 being adopted possibly from as early as 2007-08 The industry then proposes that Phase 2 be introduced in 2012 Phase 1 USA EPA standards were adopted in the USA in 1995 to be applied to equipment manufactured from 1997 and Phase 2 standards were introduced in 2002 through to 2007 and these included averaging banking and trading provisions A comparison between the USA Phase 1 and Phase2 standards is given in Table 14 The USEPA is discussing Phase 3 limits for the adoption in 20102011 which includes tighter exhaust emission limits for non-handheld equipment

The emissions limit of the two stroke lawn mower manufactured by the sole Australian manufacturer are well above USA Phase 1 limit for non-handheld equipment One avenue to address this issue which was supported by the Expert Panel ndash Outdoor Equipment would be to place lawn mowers in the US EPA Category 5 (engines gt50cc) This would result in emissions for two stroke lawnmowers being limited to 161 gkW-hour HC + NOx compared to the USA regulated limit of 161 gkW-hour HC + NOx Doing this would align the ramp-up timetable for mowers with that of other garden products

Table 14 Comparison between the USA Phase 1 and Phase 2 standards

Emission Limits GkW-hr

Phase 1 (1997 ndash2001) Phase 2 (2007) HC NOx HC+NOx CO HC+NOx CO

Non-handheld I-A lt66cc 161 610 I-B 66-lt100cc 161 610 I 100-225 cm3 161 519 161 610 II 225 cm3 134 519 121 610 Handheld III lt20 cm3 295 536 805 50 805 IV 20-50 cm3 241 536 805 50 805 V 50 cm3 161 536 603 72 603

Phase 2 limits were phased in between 2002 -2007 during which time they became tighter for simplicity only the 2007 are shown in this table (see Table 2 for more details)

30

In addition to limiting emissions the Expert Panel support the inclusion of the durability criteria which apply in the USA under Phase 2 standards and certification documentation from either the USA or Europe as adequate proof of conformity Equipment that has not been tested and certified to USA or European standards will be required to have the engines tested in a NATA certified laboratory

Some in the industry argued that regulations should include provisions for averaging for companies that wish to use it however they felt banking and trading provisions would not be necessary Industry representatives were not supportive of any Australian consumer labeling requirement instead OPEA members are willing to supply emissions data for inclusion in a web-based database that would allow purchasers to assess the environmental credentials of different makes and models

62 Discussion on recommended regulations

Timing of introduction

Some industry representatives argue that introduction of Phase 1 standards in 2007-08 will not give the industry an adequate transition period in which to develop competence in emissions certification establish new procedures and tooling in the dealers workshops train dealers and technicians on legal requirements distribute specific tooling and spare parts and reduce stocks of old (non certified) products without incurring an undue financial burden While others in the industry prefer progressing straight to phase 2 standards

If the OPEA preference for the adoption of the United States Phase 1 regulations which operated in the USA between 1995 and 2001 were introduced in Australia in 2007-08 they would be well behind the USA standards and worldrsquos best practice Furthermore the introduction of the United States Phase 2 - 2007 limits in Australia in 2012 would if the USEPA introduce Phase 3 in 2010-11 see emission limits for lawnmowers and other non handheld garden equipment in Australia still lagging United States standards and worldrsquos best practice

To introduce regulations in 2007-08 will require Government firstly to determine the most appropriate mechanism under which to enact the regulations draft the regulations prepare the regulatory impact assessment consult with the broader community and then finalise the regulations It is likely an Act of Parliament will be required at the Commonwealth level followed by complementary legislation at the State and Territory level It is possible for this to be achieved in less than a two year timeframe (as was the case for the Water Efficiency Labelling Scheme) However regulations that do not have a level of perceived urgency would take longer The level of importance and urgency to control emissions from small engines has yet to be debated and determined

31

Modified USEPA limits for lawnmowers

From the 183 lawn mowers identified through the market survey Victa is the main (possibly sole) provider of two stroke mowers with the other lawnmowers having cleaner four stroke engines

Victa is undertaking work to produce a cleaner product Victa estimates it would need a number of years to complete development production tooling and commercialisation of the cleaner engines In January 2007 it released a new two stroke carburettor lawnmower that has reduced engine emissions by more 30 but the combined HC and NOx emissions are still above USEPA Phase 1 limits Victa says this new engine is the outcome of four years of collaborative work by Victa and the University of Technology Sydney Victa is continuing with this research to further reduce emissions

A clause that allows exemptions to be granted as occurs in other countries could be included in the regulations however Victa argues that this would create uncertain trading conditions for the company for a period of time until an exemption were granted

Placing lawn mowers in the US EPA Category 5 (engines gt50cc) has the risk of opening the Australian market to more two stroke lawn mowers which has the greatest use of any outdoor powered equipment however it should see the continuance of the sole engine being manufactured in Australia In 1995 when it was introducing small engine emission limits the USEPA faced a similar issue with two stroke lawn mowers and used a similar approach by allowing two stroke lawn mowers to comply with the handheld standards It also specified that the number of two stroke lawnmower engines allowed to meet handheld standards would be subject to a declining annual production cap with the allowance provided by the production cap being phased out in 2003 There is also similar precedent for small engine emission limits that depend on engine type - European regulations for marine outboard motors set less stringent requirements for two stroke motors

Averaging Banking and Trading Provisions

The US EPA did not have averaging banking and trading provisions in Phase 1 and therefore all small outdoor engines were required to meet the Phase 1 limits It only introduced ABT provisions in the much more stringent Phase 2 as they would allow the most economic introduction of cleaner engines The industry claims the systems to use this provision are available and can be implemented in Australia by those who wish to use it at little cost to government

Industry claim that any supportive economic data related to averaging is sensitive and confidential It is there difficult without substantial justification by the industry to support the provision for averaging in conjunction with Phase 1 particularly given the elapsed time between the introduction of Phase 1 in the USA and their recommended introduction in Australia If there are some low volume equipment items that still cannot meet the USAEPA Phase 1 standards then these could be subjected to

32

exemptions if adequate justification can be provided (exemptions for small volumes were available under the USEPA regulations)

It was noted that for government to implement regulations a regulatory impact statement is required and this requires an assessment of the costs and benefits of the options considered with clear overall benefits shown for the preferred option Therefore if the option for manufacturers to use averaging were to be considered more information to support its inclusion would be required

Other options that could be considered to circumvent the inclusion of averaging include

i including clauses that give manufacturers the ability to apply for exemptions from the regulations for classes of equipment that have small sales volumes (these provisions are available in the USA)

ii limiting the regulation to popular types of equipment

iii using the end-of-model life provisions that have been used in the Australian Design Rules for cars In effect the end of model life provisions require new designs to comply from the implementation date but allow older models to remain on sale for a few more years This is an alternative to ABT because it facilitates earlier introduction of the regulation

iv Having a phase in period of say 2 years during which existing models can continue to be sold but new models coming on to the market must comply with the new standards At the end of the phase-in period all models must comply with the new standards This is an approach that is used when Australian Design Rules (ADRs) are introduced for motor vehicles

Consumer Information

Current Australian directions to reduce the environmental impact of consumer products favor tiered benchmarks using a lsquostarrsquo rating system (see Appendix 3 for examples such as the Mandatory Energy Efficiency Label and the Water Efficiency Labelling Scheme)

As products generally arrive in Australia assembled and packaged industry considers a mandatory requirement to label products with an Australian style star rating would impose a cost on distributors that would drive up the retail price of products Instead the OPEA members were willing to supply emissions data for inclusion in a web-based database that would allow purchasers to assess the environmental credentials of different makes and models Given the diverse nature of the industry it is unlikely a database would provide complete coverage of all products on the Australian market but inclusion in the database would indicate that the manufacturer has a commitment to environmental performance It was acknowledged in discussions that at least some Phase 2 compliant products would become available prior to 2012 and the web-based database would provide one method to promote those cleaner engines

33

In summary the Recommendations of the Expert Panel

1 Mandatory air pollutant emission standards to be introduced in Australia for all outdoor equipment (lt19kW) powered by spark-ignition engines The development of any regulation would need to be based on a formal assessment of the costs and benefits of nationally regulating 2 and 4 stroke lawn mowers and handheld power equipment which should be commenced immediately

2 Proposed standards to mirror US EPA regulations (compliance with equivalent EU regulations also acceptable)

3 Timing (subject to completion of assessment of costs and benefits)

(a) US EPA Phase 1 ndash Effective from 2007 2008

(b) US EPA Phase 2 ndash Fully implemented in 2012 (in step with 2007 USEPA limits) with phase-in period andor ABT over 2008-2012 to provide for early introduction of cleaner product

4 Walk-behind 2 stroke mowers to be included in US EPA Category 5 (gt50cc) product classifications Implementation timing to be as in Recommendation 3 above

5 All products also to be certified to relevant EPA durability categories

6 Subject to further review ABT (if included) may be phased out after 2012

34

7 The Way Forward

The optimum approach for garden equipment out engine emissions of options needs to be sustainable and cost effective This will need to be determined through a costs and benefits analysis (CBA) CBA assigns monetary values and typically assesses the impacts on the consumer on human health on the environment on industry and on government A detailed costs and benefits analysis is beyond the scope of this report however the following sections draws on available information to provide some indication of the possible costs and benefits that are associated with emissions from garden equipment engines

Air Quality Benefits

Environment Canada estimated the introduction of the regulations would result in a 44 percent reduction in combined HC+NOx emissions from small engines used in garden equipment and reduction in individual air pollutants over a 25 year period as shown in Table 15 The Canadian estimates incorporate the benefits that would accrue from the MOU signed with the industry in 2000 plus the benefits from the regulations introduced in 2003 In 2000 Canada imported around 13 million small spark-ignition engines and machines (ie a similar number to Australia) with 80 supplied by the USA

Table 15 Canadian Small Spark-Ignition Engine Emissions in Year 2025

Substance Base Case Emissions in 2025

Emissions in 2025 with Regulations

Percentage Reduction in 2025 (Regulations vs Base Case)

Criteria Air Contaminants (kilotonnes)

HC 772 410 469

NOx a 84 67 201

CO 1413 1403 07

Greenhouse Gas (kilotonnes)

CO2 2903 2645 89 Base case year 2000 (accommodating voluntary agreement) Source Canada Gazette Part II Vol 137 No 24 2003-11-19

Other Environmental Costs and Benefits

In addition to the human health benefits associated with reduced exposure to ozone there is a range of other public benefits including reduced damage to vegetation and therefore higher crop yields less damage to materials and structures particularly

35

some rubber products and improved visibility due to a reduction in smog haze Plus there are benefits associated with lower emissions of other air pollutants

To date there appears to have been little work undertaken in assigning a monetary value to these benefits as it is considered that they are likely to be small compared to human health impacts

Health Costs and Benefits

The Final Impact Assessment for the Ambient Air Quality National Environment Protection Measure (NEPC 1998) estimated that the health damage costs from exposure to ozone nationally to be in the range of $90 ndash $270 million (in 1998 dollars) This figure did not include mortality costs because of difficulty in assigning a figure to human life nor did it include costs associated with minor symptoms such as sore throat cough headache chest discomfort and eye irritation that can result from ozone exposure On the cost of ozone exposure the Impact Assessment states that lsquothe social well-being associated with potentially 6 and 20 million fewer irritating symptoms annually cannot be reliably quantified but at $1 a symptom it adds up to an appreciable amountrsquo

Since the Air NEPM Impact Assessment ozone levels in Australian urban areas have not fallen significantly but the population and medical costs have increased since then However using the above figures to make a rough estimate the contribution made by engines used in lawnmowers (ie not including other garden equipment) to the health damages cost from ozone exposure would be at a minimum $36 - $108 million not including the cost of mortality or minor symptoms As any action on these engines is likely to only remove high emission engines over a decade or more a CBA would be required to include an assessment of the proportional health benefits that would accrue from only removing the high emitters over time

Costs and Benefits to the Consumer

In 1995 the USEPA estimated that on average the cost to the engine manufacturer to install the necessary emission control technology to meet Phase 1 standards (which didnrsquot have ABT) would be approximately $US2 per engine used in nonhandheld equipment and $US350 per engine used in handheld equipment It also estimated that this would translate to sales-weighted average price increases of about $US7

The introduction of phase 2 regulations USEPA estimated would result in price increases of between $US20 and $US64 for handheld equipment depending on the equipment class (USEPA 2000) where handheld engines ranges in price from $60 to $1000 (USEPA 1995)

In addition to emission reductions the implementation of exhaust emission limits has the advantage of reducing fuel consumption and lowering operating costs to the consumer For example the USEPA estimated that for Phase 1 limits that applied between 1995 and 2001 on an average sales-weighted engine basis would decrease fuel consumption by 26 percent for non handheld equipment and a 13 percent decrease in fuel consumption for handheld equipment (USEPA 1995) Phase 2

36

(current limits) would result in a further decrease in fuel consumption of approximately 30 percent for handheld engines

When the USEPA considered the fuel savings offset and the retail price increase it estimated that the average sales-weighted lifetime increase in cost would be about $US650 per handheld engine while nonhandheld engines will realize a lifetime savings of about $US250 per engine This does not include the lifetime savings in maintenance costs which should further benefit the consumer (USEPA 1995)

Euromot (The European Association of Internal Combustion Manufacturers) claims that compliance with European minimum performance standards that do not have ABT provisions adds around 30 to the cost of some products that have had to be brought into compliance4 compared to products sold under the ABT system in the US

Costs and Benefits to Industry and Government

As there is only one local manufacturer among the 43 distributors of powered outdoor garden equipment sold in Australia and all others are importers the main costs to reduce the emissions contribution made by these engines will be associated with program administration and compliance particularly if regulations are introduced

The Productivity Commission an independent agency which is the Australian Governmentrsquos principal review and advisory body on microeconomic policy and regulation recently examined the cost effectiveness of measures to improve the energy efficiency in household appliances As part of its review lsquoThe Private Cost Effectiveness of Improving Energy Efficiencyrsquo it examined labelling programs (ie regulated tiered benchmarks) and minimum mandatory energy efficiency requirements (ie a regulated simple benchmark) While the household appliance market is considerably larger than the garden equipment market the Commissionrsquos final report contains some information that is useful for determining the approach that could be used to establish an emissions reduction scheme for garden equipment A summary of relevant sections of this report is provided in Appendix 3

The Commission identified both administration and compliance costs associated with labelling programs and minimum mandatory energy efficiency requirements as well the impacts these had on product suppliers

The Department of the Environment and Water Resources provided details to the Commission on the costs involved in administering both the labelling scheme and the minimum performance standards for energy programs The information provided showed that

bull the administration costs of the simple benchmark approach were substantially lower (less than one tenth) than for labelling and 84 per cent of administration costs were passed on to appliance purchasers with the remainder borne by governments

4 Presentation by Dr Holger Lochmann Rob Baker Axel Rauch Stihl 19 April 2006

37

bull the compliance costs for labelling are higher

bull minimum mandatory energy efficiency requirements can have a greater cost for suppliers than labelling since suppliers must adjust their model ranges to meet the MEPS levels by the given date These compliance costs are however influenced by the lsquolead inrsquo time between introduction and the implementation of the regulations

bull The increased cost to appliance purchasers of labelled appliances was about two and half times higher compared to appliances purchased under minimum mandatory energy efficiency requirements this being due to consumers voluntarily purchasing more efficient appliances

Overall the Commission considered that labels should be more actively considered as an alternative to minimum performance standards The Commissionrsquos support was based on the ability of labels to amongst other things

bull directly address ldquoa source of market failure mdash the asymmetry of information between buyers and sellers of energy-using productsrdquo

bull provide information to the consumer that is readily-accessible and easily-understood so they can help the consumer make better-informed choices

bull Have net social benefits and possibly have net benefits for consumers

bull provide a greater incentive for suppliers to sell environmentally better products

bull warn consumers through a disendorsement label that an appliance is very inefficient This approach can discourage but not prevent consumers from buying the poor performing product

71 Options to Reduce Emissions from Garden Equipment Engines

There is a range of options that could be considered for reducing emissions from engines used in outdoor garden equipment in Australia These include

1 Do nothing

2 Partnership Programs

3 Quasi regulation

4 Co-regulation

5 Regulations

In the following discussion about these options many Australian examples are mentioned Further details about these programs plus an overview are provided in Appendix 2

38

72 Option 1 ndash Do Nothing

Based on data supplied by OPEA the sales of high emitting two stroke carburettor engines as a percentage of engines used in outdoor equipment increased during the period 2002 to 2005-6 (see Table 12) from 463 to 593 and overall sales number increased by 38 during that period There is no indication that in the short to medium term that sales of equipment with two stroke carburetor engines will decrease in overall sales numbers or as a percentage of sales Therefore under the lsquodo nothingrsquo option emissions from outdoor garden equipment will continue at the same rate or perhaps based on sales figures of two stroke carburetor powered equipment at an even higher rate in the future

73 Option 2 ndash Industry - Government Partnership

In the discussion papers prepared for the NSW small engine project (2004) some examples of successful voluntary Government-Industry Partnership programs were provided The examples included were

bull the National Industry Reduction Agreement where the major newspaper and magazine publishers in Australia agreed to promote recovery and recycling of old newspapers and magazines

bull the NSW EPA-Oil Industry MOU on Summer Fuel the National Packaging Covenant (which has legislative backup) and

bull the EPA Victoriarsquos agreement with the Altona Chemical Complex

From the Australian programs reviewed it appears that the best indicators for successful partnership programs are

bull a relatively small number of firms within the industry

bull a commitment and involvement by all of the industry

bull clear program aims and objectives plus program targets and

bull a willingness by the industry to enter into a cooperative partnership with government

There are 43 identified distributors selling 97 brands of outdoor powered equipment in Australia Many of the major distributors are members of OPEA but there are many distributors who are not members It is therefore unlikely that the even the majority let alone all of the Australian distributors would commit to a industry-government partnership to reduce emissions

74 Option 3 - Quasi Regulation

Quasi regulations can take a range of forms the most usual being the establishment of a code of practice that industry endorses and implements A fundamental part of the code of practice would be emissions standards There are few examples of the use of codes of practice to limit emissions

39

Governmentrsquos role under this scenario is likely to be in assisting in the development of standards

The likelihood of this option being successful for similar reasons to the industry government partnership option is low

75 Option 4 -Co Regulation

Co-regulation is an agreement by industry and government to certain undertakings that support the uptake of cleaner products with a regulatory base It allows industry program flexibility to achieve certain negotiated targets Australian examples of coshyregulation include

bull The Green Vehicle Guide which operates through an industry government agreement where industry report test results to government in an agreed format within a certain timeframe Government manages the data and promotes the program This program is underpinned by Australian Design Rules for motor vehicles

bull The electrical appliance stand-by power program where there are agreed targets established that industry is required lsquovoluntarilyrsquo to meet failure to achieve the targets will result in regulation

bull The Packaging Covenant which is a program that allows industry the flexibility to design it own programs to reduce packaging waste and achieve certain target The Covenant is complemented by the NEPM on used packaging which specifies certain government responsibilities to support the program plus measures that will be introduced if targets are not met

Given the large number of distributors on the Australia market co-regulation for engines used in garden equipment using a similar form to the standndashby power program or the packaging program - an agreement by industry and government on a percentage reduction target for the sale of high emitting engines within a specified timeframe together with an agreement that regulation will be adopted if the target is not met ndash is also unlikely to be successful

76 Option 5 - Regulation

Regulation which requires a clear acknowledgement of a sufficient problem by Government places uniform mandatory compliance obligations on industry The costs associated with regulations are usually shared between government and industry with the development of regulations and program administration costs being borne by government with industry meeting compliance costs including emissions testing and if applicable labelling costs

It could argued that regulation should be introduced in the States or Territories where there are exceedances of the Air NEPM ozone standards However development of state based regulations for garden equipment engines emissions is unlikely as they would be incompatible with the 1992 Intergovernmental Agreement on the

40

Environment signed by the Commonwealth States and Territories and existing Commonwealth and State Government mutual recognition legislation The Intergovernmental Agreement on the Environment which underpins the development of National Environment Protection Measures obligates all jurisdictions to ensure equivalent protection from air pollution to all Australians

In addition enforcement of any state based legislation would be a key problem Under the Commonwealth Mutual Recognition Act 1992 and the Trans-Tasman Mutual Recognition Act 1997 goods that are imported into or produced in an Australian State or Territory or New Zealand that can be sold lawfully in that jurisdiction can be sold freely in a second jurisdiction even if the goods do not comply with the regulatory standards of the second jurisdiction This means non-regulated small engine products legally sold in one State could be legally sold in any other state regardless of whether emissions limits on small engines applied in that State

National regulation on the other hand would provide national consistency It would also provide the opportunity to adopt worldrsquos best practice standards and incorporate penalties for non-complying parties

Under the Australian Constitution the Commonwealth does not possess specific legislative powers in relation to the environment and heritage There are however a number of legislative powers that can support environment and heritage legislation Furthermore Commonwealth legislative powers can be used cumulatively For example the Commonwealth Parliament can make laws under section 51(20) of the Constitution with respect to ldquoforeign corporations and trading or financial corporations formed within the limits of the Commonwealthrdquo

Legislative mechanisms may also be created through the development of a National Environment Protection Measure (NEPM) that then becomes law within each jurisdiction A NEPM can accommodate flexibility of implementation where jurisdictions that have elevated ozone levels can tailor their NEPM program to their specific air quality needs An example of this flexible approach is the Diesel NEPM which has a suite of programs which can be implemented by jurisdictions

From the review of Australian regulations to reduce the environmental impacts of products and the overseas approaches to control emissions from small engines two regulatory approaches become apparent a simple benchmark or tiered benchmarks These are outlined below

Regulatory Option1 - A Simple Benchmark Approach

The most basic regulatory approach that could be taken would be to have a single emission standard (or as per the USA Europe and California a number of emission standards based on power and application) for combined HC + NOx emissions All equipment with new engines sold in Australia from the date the regulations are introduced This approach would

bull remove the all high emission engines from sale

41

bull be supported by an Australian Standard and

bull provide consumers with confidence that all products meet certain emissions standard

Regulatory Option 2 -Tiered Benchmarks

Current Australian directions to reduce the environmental impact of consumer products favour tiered benchmarks using a lsquostarrsquo rating system (see Appendix 2 for examples)

For engines used in garden equipment a tiered emissions labelling system could be based on the USEPA Phase 1 and Phase 2 standards use a system of lsquostarsrsquo to provide information to consumers about environmental performance but not limit consumer choice A tiered lsquostarrsquo system approach would

bull reward those products with more stars that meet the more stringent overseas standards

bull either operate with minimum emissions performance standards or disendorsement labels

bull be supported by a product label and possibly a web database

bull provide consumers emissions information and the option to purchase a lower emission engine

bull be supported by an Australian Standard and

bull be devised to meet worldrsquos best practice which is an overarching approach supported by Government

Table 16 summarises the main strengths and weaknesses of the above options

42

Table 16 Main Strengths and Weaknesses of Each Option

Strengths Weaknesses

Do Nothing Does not limit consumer choice Emissions contribution likely to grow No cost to government No barrier to new market entrants selling

high emitters Consumers have a wide choice of products Industry unchecked amp product dumping

likely No enforcement recourse on environmental grounds available

Partnerships Some sharing of responsibility government Slow if any reduction in high emitters

ndash industry

Potential for Government assist in Few if any companies likely to join and no advancing reductions in high emitters restrictions on non signatories Reduction targets set Below worldrsquos best practice

Quasi Regulation Similar strengths to partnership option Similar weaknesses to partnership option as

few if any companies likely to adopt code of practice

Co-Regulation Ongoing consultation between industry and Due to industry diversity targets unlikely to government recourse to regulation be met Targets set and can require new market Slow reduction in emissions entrants to achieve targets Can have implementation flexibility Emissions test standard adopted

Regulation Option 1- Simple Benchmark Worldrsquos best practice standards can be ovide incentives to manufacturers to promote low adapted and is mandatory emitters

Recourse to legal action available for non Does not provide consumers with emissions compliance information Significant quantifiable health benefits Cost of enforcement borne by taxpayers Requires compliance by all industry and High cost to government bans high emitters

Regulation Option 2 ndash Tiered Benchmarks Provides consumers with emissions information but does not limit choice Incentives for manufacturers to sell low emitters Potentially significant quantifiable health benefits Can be designed to overcome ABT issue

Significant administration and compliance costs to Government High cost to government and industry and will increase retail price of engines Does not ban high emitters

43

77 Preferred Approach

From the above discussion and from the review of garden equipment on available to the Australian consumer there are many companies selling powered garden equipment on the Australian market and the market is very competitive Furthermore from the Expert Panel discussions and stakeholder consultation it is apparent that it is highly unlikely that all the companies in the garden equipment industry would engage in or commit to a voluntary program to reduce their productsrsquo exhaust emissions It is therefore clear that the only feasible path to reduce emissions from these small engines is through regulation

While regulations of emissions from small engines used in garden equipment in Australia are likely to be based on overseas regulations they need to strike a balance between improved environmental outcome harmonisation with international standards and the characteristics of the local industry With regulation optimum emissions reductions are achievable especially by combining minimum emissions standards with tiered product labelling Whether this approach is justifiable on economic grounds that is the benefits outweigh the costs can only be determined through a detailed impact assessment Based on these findings it is recommended that a formal assessment of the costs and benefits of nationally regulating 2 and 4 stroke lawn mowers and handheld power equipment should now be commenced

44

References Air Resources Board California Environmental Protection Agency Californian Exhaust Emission Standards and Test Procedures for 2005 and Later Small Off-road Engines July 26 2004

Artcraft 2003 A Major Research-Based Review and Scoping of Future Directions for Appliance Efficiency Labels in Australia and NZ prepared for the Australian Greenhouse Office viewed at wwwenergyratinggovaulibraryindexhtml

Australian Bureau of Statistics 1999 Older People Australia A Social Report Report Number 41090 December 1999

Australian Greenhouse Office 2002 Achievements 2002 National Appliance equipment energy efficiency program Commonwealth of Australia

Australian Greenhouse Office 2002 Achievements 2002 National Appliance equipment energy efficiency program Commonwealth of Australia

AustralianNew Zealand StandardtradeASNZS 64002005 Water efficient productsmdashRating and labeling Federal Register of Legislative Instruments F2005L01571

Bei L T and Widdows R1999 Product knowledge and product involvement as moderators of the effects of information on purchase decisions a case study using the perfect information frontier approach Journal of Consumer Affairs 33(1) 165-186

Buy Recycled Busines Alliance Briefing Paper Environmental Claims And Labelling Abstract lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10-2003

California Code of Regulations 1998 Final Regulation Order Article 1 and Article 3 Chapter 9 Division 3 Title 13 Attachment 1 26 March 1998 wwwarbcagovregactsoreregs_finpdf

Canada Gazette Part II Vol 137 No 24 2003-11-19

Canadian Gazette 29 March 2003 Vol 137 No 13 Part 1 pp 935- 955

Cap Gemini Ernst amp Young (2001) Cars Online 2001 Global consumer survey httpa593gakamainet75931951a8b278a28319eawwwcgeycomhightechautomediaC ars_online2pdf

Clothes Washers Australiarsquos Standby Power Strategy 2002 ndash 2012 Standby Product Profile 200308 October 2003 wwwenergyratinggovau

Craig ndash Lees M Joy Sally Browne B 1995 Consumer Behaviour John Wiley amp Sons Queensland 1995

Department of Environment and Conservation NSW 2004 Measures to Encourage the Supply and Uptake of Cleaner Lawnmowers and Outdoor Handheld Equipment

45

Department of Environment and Conservation 2003 Who cares about the environment in 2003 A survey of NSW peoplersquos environmental knowledge attitudes and behaviours DEC Social Research Series

Department of Environment and Conservation Action for Air update 2006

Department of Environment and Conservation The Buy Recycled Guide Online Directory viewed at wwwresourcenswgovauindex-RNSWhtm

EcoRecycle 2004 Paint Take-Back Takes Off in Bayswater Media release 24 March 2004 viewed at wwwecorecyclevicgovau May 2004

Enviromower viewed at wwwenviromowercomau June 2004

Environment Canada 2000 Future Canadian Emission Standards for Vehicles and Engines and Standards for Reformulation of Petroleum Based Fuels Discussion Paper in Advance Notice of Intent by the Federal Minister of the Environment April 2000 wwwecgccaenergfuelsreportsfuture_fuelsfuture_fuels1_ehtm

Environment Canada 2004 Environment Minister Urges Canadians to Reduce Greenhouse Gas Emissions and Mow Down Pollution With Unique Incentive Program Media Release April 23 2004 viewed at wwwecgccamediaroomnewsrelease May 2004

Environment Protection and Heritage Council National Environment Protection (Ambient Air Quality) Measure Report on the Preliminary Work for the Review of the Ozone Standard October 2005

Environment Protection Authority 2006 Victoriarsquos Air Quality ndash 2005 Publication 1044 June 2006 wwwepavicgovau

Environmental Choice NZ 2001 Public Good and Environmental Labelling An Internal Background Paper

European Commission Directive 200344EC amending the recreational craft directive and comments to the directive combined 211005

George Wilkenfeld and Associates Pty Ltd with Artcraft Research and Energy Efficient Strategies Tomorrow Today 2003 Final Report A Mandatory Water Efficiency Labelling Scheme for Australia Prepared for Environment Australia June 2003

George Wilkenfeld and Associates 2003 A National Strategy for Consumer Product Resource Labelling in Australia prepared for the Australian Greenhouse Office December 2003 viewed at wwwenergyratinggovaulibraryindexhtml

Green Vehicle Guide wwwgreenvehicleguidegovau

Harrington L and Holt S 2002 Matching Worldrsquos Best Regulated Efficiency Standards ndash Australiarsquos success in adopting new refrigerator MEPS wwwenergyratinggovaulibrarypubsaceee-2002apdf

46

Harris J and Cole A 2003 The role for government in ecolabelling ndash on the scenes or behind the scenes lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10-2003

Holt S and Harrington L2003 Lessons learnt from Australiarsquos standards and labeling program Paper presented at ECEEE Summer Study - 2-6 June 2003 wwwenergyratinggovaulibraryindexhtml

IBIS 2006a Domestic Hardware Retailing 09-Jun-2006 Industry Code G523b

IBIS 2006b Gardening Services 18-Jan-2006 Industry Code Q9525

IBIS 2003 Gardening Services in Australia 23 December 2003 Industry Code Q9525

Lawrence K Zeise K amp Morgan P 2005 Management Options for Non-Road Engine Emissions in Urban Areas Consultancy report for Department for Environment amp Heritage Canberra

Motor Vehicle Environment Committee (MVEC) in consultation with the Department of Transport and Regional Services 2002 Proposal for an Australian ldquoGreen Vehiclesrdquo Guide viewed at httpwwwdotarsgovaumvegreen_vehicles_guidedoc May 2004

National Appliance and Equipment Energy Efficiency Committee The Energy Label at wwwenergyratinggovau (3504)

National Environment Protection Council 2005 National Environment Protection (Ambient Air Quality) Measure Report on the Preliminary Work for the Review of the Ozone Standard October 2005

National Environment Protection Council 1998 Final Impact Assessment for Ambient Air Quality National Environment Protection Measure June 1998

National Environment Protection Council 1999 Used Packaging Materials Impact Statement for the Draft NEPM Used Packaging Material January 1999 viewed at wwwephcgovau

National Environment Protection Council 2004 National Environment Protection (Air Toxics) Measure April 2004 viewed at wwwephcgovau

New South Wales Government 2002 Protection of the Environment Operations (Clean Air) Regulation 2002

New South Wales Government 1999 NSW Government Procurement Policy Statement White Paper 1999

Nordic Council 2002 Ecolabelling of marine Engines Criteria Document 8 December 1995 ndash 6 December 2005 version 35 December 2002

47

Office of Public Sector Information Statutory Instrument 2004 No 2034 The Non-Road Mobile Machinery (Emission of Gaseous and Particulate Pollutants) (Amendment) Regulations 2004 wwwopsigovuksisi200420042034htm

Outdoor Power Equipment Institute 2001 Profile of the Outdoor Power Equipment Industry wwwopeiorg

Productivity Commission 2004 The Private Cost Effectiveness of Improving Energy Efficiency Final report October 2005 wwwpcgovauinquiryenergy

Publishers National Environment Bureau Media Release lsquoAustralia leads the world in newspaper recyclingrsquo 6 June 2006 wwwpnebcomau

Real J Jones A 2005 The Green Vehicle Guide Clean Air Soceity of Australia and New Zealand Conference 2005 Hobart

Salmon G Voluntary Sustainability Standards and Labels (VSSLs) The Case for Fostering Them OECD Round Table On Sustainable Development

Schkade D A and Kelinmutz D N 1994 Information displays and choice processes differential effects of organization form and sequence Organizational Behavior and Human Decision Processes 57(3) 319-337

Stephens A 2003 Eco Buy (Local Government Buy Recycled Alliance Victoria) Abstract lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10shy2003

Teisl M F Roe B and Hicks RL 2002 Can eco-labels fine tune a market Evidence from dolphin-safe labeling Journal of Environmental Economics and Management 43339-359

Teisl M F Roe B and Levy A S Ecolabelling What does consumer science tell us about which strategies work pp141-150

The ISO 14000 family of standards guides and technical reports

The Parliament of the Commonwealth of Australia 2004 House of Representatives Water Efficiency Labelling and Standards Bill 2004 Explanatory Memorandum wwwcomlawgovauComLawLegislationBills1nsf viewed February 2006

Thogerson J 2000 Promoting green consumer behaviour with eco-labels Workshop on Education Information and Voluntary Measures in Environmental Protection National Academy of Sciences ndashNational Research Council Washington DC November 29-30

United States Environmental Protection Agency Federal Register Vol 60 No 127 3 July 1995 Control of Air Pollution Emission Standards for New Nonroad Spark-ignition Engines At or Below 19 Kilowatts wwwepagovEPA-AIR1995JulyDay-03prshy805txthtml

48

United States Environmental Protection Agency Federal Register Vol 69 No 7 12 January 2004 Rules and Regulations 40 CFR Part 90 Amendments to the Phase 2 Requirements for Spark-Ignition Nonroad Engines at or Below 19 Kilowatts Direct Final Rule and Proposed Rule wwwepagovfedrgstrEPA-AIR2004JanuaryDay-12a458pdf

United States Environmental Protection Agency Office of Pollution Prevention and Toxics Pollution Prevention Division 1998 Ecolabelling Environmental Labelling - A Comprehensive Review of Issues Policies and Practices Worldwide

United States Environmental Protection Agency Office of Transportation and Air Quality March 2000 Regulatory Announcement Final Phase 2 Standards for Spark-Ignition Handheld Engines

United States Environmental Protection Agency 1998 Proposed Phase 2 Emission Standards for Small SI Engines 27 January 1998

United States Environmental Protection Agency 2000 Regulatory announcement Final Phase 2 Standards for Small Spark-Ignition Handheld Engines March 2000 EPA420-F-00shy007

United States Federal Register Vol 69 No 7 Monday January 12 2004 Rules and Regulations Environmental Protection Agency 40 CFR Part 90 Amendments to the Phase 2 Requirements for Spark-Ignition Nonroad Engines at or Below 19 Kilowatts Direct Final Rule and Proposed Rule United States Federal Register Vol 64 No 60 30 March 1999 40 CFR Part 90 Phase 2 Emission Standards for New Nonroad Spark-Ignition Nonhandheld Engines At or Below 19 Kilowatts Final Rule pp15214-15216

United States Federal Register Vol 65 No 80 25 April 2000 40 CFR Parts 90 and 91 Phase 2 Emission Standards for New Nonroad Spark-Ignition Handheld Engines at or Below 19 Kilowatts and Minor Amendments to Emission Requirements Applicable to Small Spark-Ignition Engines and Marine Spark-Ignition Engines Final Rule pp24282-24284

United States Environmental Protection Agency Control of Air Pollution Emission for New Nonroad Spark-ignition Engines At or Below 19 Kilowatts Final Rule 40 CFR Parts 9 and 90 1995 wwwepagovEPA-AIR1995JulyDay-03pr-805txthtml

United States Environmental Protection Agency Office of Pollution Prevention and Toxics Pollution Prevention Division 1998 Ecolabelling Environmental Labeling- A Comprehensive Review of Issues Policies and Practices Worldwide

Victorian Government Greenhouse Strategy Community Action Fund - Mow Down Lawn Mower Rebate Exchange Program wwwgreenhousevicgovaucommunitygrantscafsuccessfulprojectshtm

Water Efficiency Labelling and Standards Act 2005 No 4 wwwcomlawgovauComLawLegislation

49

Water Efficiency Labelling and Standards Determination 2005 wwwcomlawgovauComLawLegislationLegislativeInstrument1nsf

Water Efficiency Labelling and Standards Regulations 2005 wwwcomlawgovauComLawLegislationLegislativeInstrument1nsf

Wilkie W 1994 Consumer Behaviour John Wiley and Sons NY as cited in Craig ndash Lees M Joy Sally Browne B 1995 Consumer Behaviour John Wiley amp Sons Queensland 1995

wwwenergyratinggovau

wwwgreenvehicleguidegovau

wwwwaterratinggovau

50

Appendix 1 Detailed Breakdown of Powered Garden Equipment on the Australian Market

The following table gives a profile of the current equipment on the Australian market It is based mostly on distributor responses to a survey and might not be representative of the total market

Low sales indicates that no sales data was available but volumes are likely to be small compared with popular equipment Phase 1 is US EPA Phase 1 or EU Directive 200288EU Phase 2 is US EPA Phase 2 or Euro standards

Type Ranges Stroke Aerator 5 makes 6 models Sales Low

Engine power 26 to 172kW Engine displ 143-674 ml

2c -4c 5 Unspecified 1 Phase 1 - Phase 2 4

Auger 3 makes 5 models Sales Low

Engine power 12 to 16kW Engine displ 31-ml

2c 5 4c -Unspecified -Phase 1 1 Phase 2 1

Backhoe 0 makes 0 model Sales Low

(2 models in 2003) -

Blower 13 makes 49 models Sales 109K

Engine power 07 to 31kW Engine displ 24-80ml

2c 34 4c 2 Unspecified 13 Phase 1 10 Phase 2 17

Blower-wheeler 3 makes 6 models

Engine power 07 to97kW Engine displ 24-305ml

2c 1 4c 4 Unspecified 1 Phase 1 3 Phase 2 -

Blowervac 6 makes 9 models Sales

Engine power 07 to 11kW Engine displ 24-34ml

2c 6 4c -Unspecified 3 Phase 1- Phase 2 3

Brush cutter 12 makes 95 models Sales 339K

Engine power 06 to 23kW Engine displ 21-54ml

2c 66 4c 5 Unspecified 24 Phase 1 15 Phase 2 34

Chainsaw 9 makes 106 models Sales 152K

Engine power 1 to 58kW Engine displ 26-122ml

2c 74 4c -Unspecified 32 Phase 1 18 Phase 2 27

Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

51

Type Ranges Stroke Clearing saw Engine power 14 to 27kW 2c 6 3 makes Engine displ 36-57ml 4c 0 9 models Unspecified 3 Sales low Phase 1 4 Phase 2 -Cultivator Engine power 07 to 52kW 2c 2 4 makes Engine displ 25-190ml 4c 5 7 models Unspecified -Sales low Phase 1 - Phase 2 5 De-thatcher Engine power 1kW 2c 1 1 makes Engine displ 27ml 4c -1 models Unspecified -Sales low Phase 1 - Phase 2 1 Drill Engine power 1kW 2c 3 3 makes Engine displ 27ml 4c -4 models Unspecified 1 Sales low Phase 1 - Phase 2 1 Edger Engine power 1 to 4kW 2c 12 10 makes Engine displ 24-190ml 4c 11 36 models Unspecified 1 Sales Phase 1 3 Phase 2 22 Garden tractor Engine power 12 to 157kW 2c -2 makes Engine displ 465 to 675ml 4c 5 12 models Unspecified 9 Sales low Phase 1 - Phase 2 3 Grass trimmer Engine power- 2c 3 1 make Engine displ 31ml 4c -3 model Unspecified -Sales Phase 1 - Phase 2 3 Hedge trimmer Engine power 06 to 1kW 2c 28 10 makes Engine displ 21-31ml 4c 1 42 models Unspecified 13 Sales 40K Phase 1 4 Phase 2 35 Lawnmower Engine power 26 to 66kW 2c 22 19 makes Engine displ 100-270ml 4c 151 183 models Price $449-$3609 Unspecified 10 Sales 424K Phase 1 95 Phase 2 48 Line trimmer Engine power 07 to 45kW 2c 25 8 makes Engine displ 24-195ml 4c 2 29 models Price $136-$299 Unspecified 2 Sales Phase 1 2 Phase 2 6 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

52

Type Ranges Stroke Log splitter Engine power 26 to 45kW 2c -1 makes Engine displ 100-195ml 4c 2 2 models Unspecified -Sales low Phase 1 - Phase 2 1 Multicutter Engine power 08 to 14kW 2c 17 5 makes Engine displ 23-36ml 4c 1 19 model Unspecified 1 Sales Phase 1 2 Phase 2 13 Olive nut shaker Engine power - 2c -1 make Engine displ - 4c -1 model Unspecified 1

Phase 1 - Phase 2 -Pole saw Engine power 08 to 14kW 2c 6 4 makes Engine displ 23-36ml 4c -10 models Unspecified 4 Sales low Phase 1 1 Phase 2 3 Power carrier Engine power 37 to 231kW 2c -2 makes Engine displ 160 to 953ml 4c 11 11 models Unspecified -Sales low Phase 1 - Phase 2 10 Power cutter Engine power 32 to 45kW 2c 5 2 makes Engine displ 64-99ml 4c -8 models Unspecified 3 Sales low Phase 1 1 Phase 2 3 Pruner (3 models in 2003) 2c -0 make 4c -0 models Unspecified -Sales low Ride-on-mower Engine power 26 to 231kW 2c -12 makes Engine displ 100 to 725ml 4c 93 124 models Unspecified81 Sales 51K Ph1 1 Ph2106 Rotary hoe (4 models in 2003) 2c -0 makes 4c -0 models Unspecified -Sales low Shredder Engine power 3 to 96kW 2c 1 6 makes Engine displ 126-389ml 4c 16 20 models Unspecified 3 Sales 46K Phase 1 - Phase 2 4 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

53

Type Ranges Stroke Stump grinder Engine power 96kW 2c -1 make Engine displ 389ml 4c 1 1 model Unspecified -Sales low Phase 1 - Phase 2 1 Tiller Engine power 08 to 59kW 2c -3 makes Engine displ 25-243ml 4c 8 9 models Unspecified 1 Sales low Phase 1 - Phase 2 7 Trencher Engine power37kW 2c -1 makes Engine displ 183ml 4c -1 models Unspecified 1 Sales low Phase 1 - Phase 2 1 Trimmer Engine power - 2c 10 2 makes Engine displ - 4c -21 models Price - Unspecified 11 Sales Phase 1 4 Phase 2 -Turfcutter Engine power 37kW 2c -1 makes Engine displ - 4c 1 1 models Unspecified -Sales low Phase 1 - Phase 2 -Vac Engine power 22 to 172kW 2c 1 5 makes Engine displ 158 to 674ml 4c 13 15 models Unspecified 1 Sales Ph11 Ph24 Vac chipper Engine power 34 to 45kW 2c -2 makes Engine displ 158-195ml 4c 3 3 models Unspecified -Sales low Phase 1 - Phase 2 1 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

54

Appendix 2 Examples of Current Australian Benchmarking Programs

The following describes in varying degrees of detail a number of current Australian benchmarking schemes classified by program type simple bench mark approaches tiered benchmarks and government industry partnerships This appendix concludes with a summary table of these programs with an assessment of their effectiveness

1 Introduction

Simple benchmark schemes (described below) such as the woodheater standards set a single point hurdle rate whereas the green vehicle guide use tiered benchmarks The new water efficiency labelling scheme and minimum energy efficiency performance standards uses both a simple benchmark through minimum performance requirement plus tiered benchmarks incorporated into labels as lsquostarsrsquo Other approaches such as the stand-by power program and the Victorian Altona Complex VOC reduction target set goals for achievement within a specified time period Other approaches taken to reduce environmental impacts include the National Packaging Covenant which uses a program based on individual companies developing tailored approaches to suit their circumstances and is supported by enforcement capability through the National Environment Protection (Used Packaging Materials) Measure (the NEPM)

2 Simple Benchmarks

21 Minimum Energy Performance Standards (MEPS)

Purpose

MEPS prescribe a minimum allowed energy performance for specific appliances Appliances that are less efficient than the relevant standard are excluded from the market

Background and Strategy

In October 1999 as part of the National Greenhouse Strategy (1998) nationally consistent MEPS and labelling schemes were adopted across Australia

Independent NATA accredited laboratories undertake product compliance checks to see whether products perform in compliance with MEPS requirements For example

bull In 2003 the government conducted check tests on eight appliance models all of which were found not to meet the claims made on the energy performance labels Two products were deregistered one was found to have not been registered and action was pending on the remaining five products (AGO 2003b)

55

bull Other regulatory actions undertaken in 2003 included fines of $3000 and $8000 against two Western Australian retailers who were found to have sold appliances without energy performance labels Queensland and Victorian retailers received infringement notices and fines totalling $10 000 (AGO 2003b)

Summary RegulNated minimum performance standards based on an Australian Standard

22 Energy Star

Purpose

An endorsement label that indicates an electronic product has achieved a specified standard when it is not performing its core function (ie on stand by)

Background and Strategy

Energy Star is a voluntary endorsement labelling program developed by the US Environmental Protection Agency (US EPA) It has been operating in the USA since 1992 and has been adopted by a number of countries including Australia Energy Star sets voluntary standards for reducing the electricity consumption of electronic equipment when it is not performing its core function

The Government stand ndash by program which is outlined below complements the energy star labelling program

Summary Voluntary endorsement label

23 Woodheater Standards

Purpose

To reduce particle emissions through Australian Standard compliant woodheaters

Background and Strategy

Since 1992 Australian StandardNew Zealand Standards have been introduced to improve the performance of wood heaters

The first standard for wood heater emissions AS4013 (1992) was published in 1992 and was revised and published as a joint AustralianNew Zealand Standard in 1999 ASNZS4013 (1999) Domestic solid fuel burning appliances - Method for determination of flue gas emission This Standard provides a test method to measure particles emitted by residential solid-fuel burning heating appliances

56

The 1992 Standard included an upper limit for acceptable particle emissions of 55 grams of particles per kilogram (oven-dry weight) of fuel burnt This emission factor was reduced to 4 gkg in the 1999 revision of the Standard The Standard applies to solid-fuel burning space-heating appliances (including those fitted with water heating devices) with a heat output of 25KW or less It does not apply to masonry fireplaces cooking stoves central heating appliances or water-heating-only appliances

AS 4013 (1999) is complemented by ASNZS4014 (1999) Domestic solid fuel burning appliances - Test Fuels and ASNZS4012 (1999) Domestic solid fuel burning appliances - Method for determination of power output and efficiency

The woodheater industry was instrumental in initiating the development of standards and it lobbied states and territories to enact legislation to mandating that woodheaters be required to meet the standards As the health affects of particle pollution have become more apparent and as some jurisdictions are having difficulty in meeting national particle standards Government has become more proactive in controlling woodheaters and more supportive of tighter standards

All states and territories with the exception of South Australia have regulations that restrict emissions from new woodheaters although Victoria for example only introduced its regulations in 2004 compared to Tasmania who introduced regulations in 1993 These regulations require that new woodheaters comply with the Australian Standard ASNZS 4013 The State regulations however are not uniform

Many woodheaters that are currently certified for sale do not comply with the revised standard as verified in a National Woodheater Audit Program undertaken in 2004 Seven of the 12 wood heaters tested failed to meet the ASNZS 4013 particle emission limit In addition 55 of heaters were found to have deviations from the original designs and 72 had labelling faults that could adversely affect emissions performance

Testing and certification are administered by the industry association

Summary State and regulations requiring compliance with Australian Standards Certification administered by industry association

24 Standby Power

Purpose

To reduce lsquoexcessiversquo energy consumed in electrical appliance standby mode sold in Australia through in the first instance voluntary targets Appliances covered by the program range from information technology equipment such as PCs and photocopiers entertainment equipment such as TVs DVDs and sound systems major appliances such as water heaters dishwashers and refrigerators and small appliances such as smoke detectors and bread makers

57

Background and Strategy

In 2000 standby power was estimated to constitute 116 per cent of Australiarsquos residential energy use costing households over $500 million and leading to the emission of over 5 million tonnes of carbon dioxide equivalent (AGO 2002c) Holt and Harrington (2004) estimated that standby power consumption in Australia could be reduced by 56 per cent by 2020 (Productivity Commission 2005)

In August 2000 all Australian jurisdictions agreed to pursue efficiencies in standby power consumption of energy-consuming products through support for the International Energy Agencys One -Watt program and endorse its incorporation into theprogram of work

Australia reportedly has taken the lead on implementing the One- Watt program even though many of the products sold in Australia are imported

During 2002 government agencies consulted with stakeholders about ideas to reduce standby The standby strategy which proposed a list of targeted potential product types was presented to the Ministerial Council on Energy

In September 2003 an interim test method for the measurement of standby power ASNZS 62301-2003 (int) based on an internationally recognised standard was published Also during this period work commenced on developing draft product profiles for high priority targeted products

Once product profiles are completed interim voluntary date-specific targets are made The product sales are then monitored to determine progress towards the interim target If it is then determined that inadequate progress is being achieved by a significant number of suppliers then government will regulate

For example the interim 2007 target for clothes washers is as follows

Product Off mode power End of program mode

lt 1W lt 4 W

The National Standby Strategy Target to be achieved by 2012 for clothes washers is as follows

Off mode power End of program mode lt 03 W lt 1 W

In support of the clothes washer program Government will

bull consider creating a Government Purchasing Policy to buy low standby clothes washers where available and fit for purpose

bull collect data on all modes for new clothes washers and analyse trends

bull highlight the range of performances by publishing performance data on clothes washers on a website or by other means

58

bull progressively include standby energy consumption into the Comparative Energy Consumption for labelled products such as clothes washers and clothes dryers

bull work with the Standards Committees to finalise the details of modes and test methods for the relevant standards

bull determine in 2008 if progress is inadequate and if regulation is required

Summary Industry targets possible future regulation

3 Tiered Benchmarks

31 Mandatory Energy Efficiency Label ndash the Energy Star Programs

Purpose

To enable consumers to easily compare the energy performance of electrical appliances used by households and firms through a labelling scheme

Background and Strategy

Several Australian states commenced mandatory energy efficiency labelling for major appliances in the mid-1980s In 1992 it became mandatory across Australia for initially refrigerators and later freezers clothes washers clothes dryers dishwashers and air-conditioners (single phase only) to carry the label when they are offered for sale This labelling program is regarded as one of the most successful in the world (Wilkenfeld and Assoc 2003) It is administered through the Australian Greenhouse Office

The energy rating label for dishwashers

(ldquoa joint government and industry programrdquo) and a website address (wwwenergyratinggovau) and has two main features

bull the star rating which gives a quick comparative assessment of the models energy efficiency and

bull the comparative energy consumption (usually kilowatt hoursyear) which provides an estimate of the annual energy consumption of the appliance based on the tested energy consumption and information about the typical use of the appliance in the home These values are measured under Australian Standards which define test procedures for measuring energy consumption and minimum energy performance criteria Appliances must meet these criteria before they can be granted an Energy Rating Label

The Energy Rating Label includes an endorsement

59

Awards Brand ModelInstallat

ionType

Phase Available

10 Yr Energy

Cost StarRating

Output(kW)

TOSHIBA

Digital Inverter Series Air

Conditioner RAV-SM1102BT-

ERAV-SP1102AT-E (

RAV-SM1102BT-ERAV-

SP1102AT-E)

SingleSplit

SystemDucted

Single $1500 1000

CHUNLAN

KFR-32GWVWa (

NO)

SingleSplit

SystemDucted

Single $645 323

Since its introduction the star rating label seems to have established a high level of recognition with consumers Consumer research (Artcraft 2003) indicates that the different information on the label appeals to different consumer segments interested in purchasing an appliance

When a manufacturer gains approval to use the label they pay for and produce the label in accordance with specifications on size colours fonts layout and design A similar colour scheme and design to the energy consumption label is also used for the compulsory fuel consumption label on new passenger and light commercial vehicles

The labelling scheme is underpinned by regulation whereby regulated Minimum Energy Performance Standards (MEPS) provide the environmental benchmarks that the appliances are required to meet Appliances that do not meet the minimum energy performance standards can be withdrawn from the Australian market

When the energy rating program was reviewed in 2000 technology had advanced to the point where a large percentage of appliances had achieved the maximum number of stars so the rating system was tightened It is estimated that over the 25 year period 1980 to 2005 there will have been an overall reduction in energy consumption of around 70 by the most popular sized refrigerators (with freezers) (Harrington L and Holt S 2002)

In addition to the energy consumption label there is a website (wwwenergyratinggovau) with a comprehensive database of all appliances their star rating and energy consumption In 2002 there were around 220000 hits on the programrsquos various websites and 523000 in 2003 reportedly representing 80000 visits by individual inquirers The website hit rate is estimated to represent almost 10 of consumers who are considering purchasing an appliance (Holt et al 2003)

Cooling

Energy Input (kW)

250

104

Figure B Excerpt from Energy Rating web page for Air Conditioners (cooling cycle only shown)

When the energy rating program was reviewed in 2000 technology had advanced to the point where the Scheme had to be tightened because a large percentage of appliances had achieved the maximum number of stars For example energy use by refrigerators was around 70 compared to that used when the scheme started (Harrington L and Holt S 2002)

60

Regulations

State and Territory legislation refer to the relevant Australian Standards This approach simplifies the State and Territory legislation and makes it relatively straightforward to maintain national consistency of appliance and equipment energy efficiency standards even when standards are continually being revised

The testing procedures and technical requirements for the label and also Minimum Energy Performance Standards (MEPS see below) are incorporated into the applicable Australian Standards Products for sale must be registered with one of the State regulators

Program Administration

The labelling program and MEPS program are administered by the National Appliance and Equipment Energy Efficiency Committee (NAEEEC) which is ultimately directed by the Ministerial Council on Energy

Requirements for Appliance Suppliers

Appliance suppliers are required to

bull Submit applications for product registration and these must include a test report or other data to demonstrate that the appliance meets the relevant Australian Standard

bull While test reports on three separate units are required for most products there is no particular requirement for test laboratories to be accredited or products certified for registration for energy labelling and MEPS in Australia Test reports from the manufacturers laboratory are satisfactory However if there is evidence that results from a particular laboratory are unsatisfactory regulators can mandate test reports from an accredited laboratory

Summary Mandatory labelling scheme backed by regulations and an Australian Standard

32 Water Appliances Water Efficiency Labelling and Standards (WELS) Scheme

Purpose

A labelling scheme backed by legislation to promote domestic water efficient appliances

Background and Strategy

A voluntary water efficiency industry administered labelling scheme has been in existence since 1988 The water efficiency ratings and details on the label design are covered in ASNZS 6400 The main incentive of the voluntary lsquoAAAAArsquo scheme

61

has been the publicity and cash rebates offered by water utilities However the coverage water efficiency performance requirements and impact of this program have been limited

In 2003 the Environment and Heritage Ministers agreed to implement a national Water Efficiency Labelling Scheme (WELS) for products such as shower heads washing machines dishwashers and toilets Consultation with industry and stakeholders was undertaken in 2003 with a strategic study published that identified the products to be included in the new labelling Scheme A Regulation Impact Statement (RIS) which identified the costs and benefits of various options and made various recommendations was published in March 2004 Following public review of the RIS some modifications were made to WELS

The WELS Scheme is backed by the following legislation and standard

Water Efficiency Labelling and Standards Act 2005 which establishes

bull the products subject to the Scheme and the requirements for registration and labelling

bull the standards to apply to WELS products setting requirements for water efficiency performance registration and labelling of these products

bull enforcement provisions including penalties bull the appointment of inspectors to investigate possible contraventions and sets

out their powers and obligations bull review and dispute resolution bull a program Regulator bull the making of regulations bull a requirement for annual reports and for an independent review after five years

Water Efficiency Labelling and Standards Regulations 2005 which

bull prescribes the circumstances in which a person other than the manufacturer of a WELS product may be taken to be the manufacturer of the product (eg an importer)

bull sets out procedures for the issuing and the payment of penalty infringement notices as an alternative to prosecution for offences against the WELS Act

bull specifying the information to be included on an identity card issued to a WELS inspector

Water Efficiency Labelling and Standards Determination 2005 amongst other things determines and establishes product registration fees and calls up the Australian Standard ASNZS6400 2005 Water-efficient products - Rating and labelling which

bull defines the products

bull specifies the assessment procedures (ie identifies test procedures in other Australian Standards)

bull provides the formulas to give products their star rating

bull specifies the labels and their application to products

62

Approximately twenty organisations were represented on the Standards Committee that developed the Standard

State and Territory legislation

The States and Territories have also enacted or agreed to enact complementary legislation to ensure that the WELS Scheme has comprehensive national coverage State and Territory legislation which is almost a mirror of the Commonwealthrsquos Water Efficiency Labelling and Standards Act 2005 enables the States and Territories to for example undertake certain responsibilities delegated to them by the Commonwealth Regulator appoint their own inspectors and enforce the WELS

Other features of WELS include

bull A product web database

bull With the exception of toilets no other products are required to meet mandatory water efficiency requirements (WES) but this may change over time The introduction of mandatory WES means that products not meeting the minimum performance requirements can not legally be sold

bull Products must be tested in accordance with the relevant Standard and must meet any minimum performance and water efficiency requirements in the Standard before they can be granted a WELS Water Rating label

bull It is up to manufacturers or their agents (eg importers in the case of imported products) to ensure that their products are correctly registered and labelled and comply with any other requirements of the Standard

There is a transition phase which gives manufacturers and importers time to test register and label products and to sell pre-existing stock From 1 January 2008 all products are required to display the WELS Water Rating labels irrespective of their date of supply

63

The WELS Water Rating label

Label Features

bull A star rating for a quick comparative assessment of the models water efficiency

bull Labels with 1 to 6 stars

bull Some products may also be labelled with a Zero Star Rated label which indicates that the product is either not water efficient or does not meet basic performance requirements

bull A productrsquos water consumption figure

bull There are provisions for swing tags if there is inadequate surface area for label or the item is likely to be marked by sticking the label on the product

Summary Mandated product labelling using lsquostarrsquo rating system Has a disendorsement label and has provisions to ban products

33 Gas Appliance Rating Scheme

Purpose

A gas labelling program to improve the energy efficiency of gas powered products

Background and Strategy

The Gas and Fuel Corporation of Victoria introduced energy labelling for gas water heaters in 1981 This scheme was taken over by the AGA in 1985 who in 1988 introduced a six star energy performance label This label was intended to be visually consistent with the star rating labels already familiar to consumers of electrical appliances

The labelling scheme is currently voluntary and still administered by the industry body

A range of gas appliances have been subject to minimum energy performance standards (MEPS) since the 1960s The current MEPS levels were set in 1983 and

64

Brand Model Type MjyearStar

RatingSRI

StorageCapacity

(ltrs)IndoorOutdoor

NaturalGas

Instantaneous 18969 59 I N

Instantaneous 18969 59 I N

lsquothe majority of models currently on the market appear to exceed current requirements by a comfortable marginrsquo (SEAV 2003 p 23)

The gas energy labels are similar in format to those found on electrical appliances except they are blue and show annual energy use in MJ

A trial web site listing gas water heaters available in Australia is also available (see below)

Bottle Gas

Rinnai Infinity

V Series

REU-V2632FFU-A (Infinity 26 plus internal) P

Rinnai Infinity

V Series

REU-V2632FFUC-A (HD2001 internal) P

A joint review of the scheme is under way by the Gas Industry and Governments and regulation is under consideration A three year work plan has been published under the Australian and New Zealand Appliance and Equipment Energy Efficiency Program

Summary Currently voluntary labelling using lsquostarrsquo rating system with mandatory minimum energy performance standards Future regulation is under consideration

34 Green Vehicle Guide

Purpose

To provide web-based comparable and accessible environmental data on new motor vehicles

Background and strategy

65

The Commonwealth government started publishing a booklet of fuel consumption data for new passenger and light commercial vehicles in the early 1980s and a low cost web database in more recent years

In 2004 the Government through the Department of Transport and Regional Services (DOTARS) expanded the fuel consumption guide into the Green Vehicle Guide The Green Vehicle Guide is a web based database that rates new passenger and light commercial vehicles on air pollution greenhouse emissions and fuel consumption and gives an overall lsquostarrsquo rating for each vehicle within each vehicle category (small medium luxury sports etc)

The data on which the scores are derived are provided voluntarily by the vehicle manufacturers however this data is based on mandatory Australian Design Rule certification test data

The Guide uses a 5 star rating system however it also assigns half stars resulting in a total of 10 levels

The Greenhouse Ratings are based on carbon dioxide emissions and the Air Pollution Ratings take into account the relative environmental impact of oxides of nitrogen hydrocarbons and particles The relative harmfulness of the pollutants (shown in table below) has been quantified based on the allowable concentrations under the Ambient Air Quality National Environment Protection Measure (NEPM)

Green Vehicle Guide Weighting of Regulated Vehicle Emissions

Vehicle Emission

(equivalent pollutant under Air NEPM)

Calculated

Relative

Harmfulness

Final

Weighting

Carbon Monoxide (CO) 0088 Not included

Oxides of Nitrogen (NOx) (based on

Nitrogen Dioxide)

4 1

Hydrocarbons (HC) (based on

photochemical oxidants as ozone)

5 1

Particulate Matter (PM) (based on PM10) 20 5

Source Real and Jones 2005

NOx and HC were given equal final weightings despite the slight difference in the calculated relative harmfulness primarily because under ADR7900 a combined HC+NOx limit is prescribed rather than individual limits for each pollutant

The higher weighting for particulate matter recognises its significant health impacts The Air Pollution rating scale was devised in such a way that a lsquotypicalrsquo car (that is most petrol engined passenger cars meeting the current emission standard at the time) receives a mid-point rating (5 out of 10)

66

The overall rating or stars is derived from the sum of the air pollution and greenhouse scores ie they are equally weighted

Development of the Green Vehicle Guide (see extract below) involved extensive consultation with vehicle manufacturers

Website Costs

The new highly automated web database which contains data on approximately 1400 vehicles and has sophisticated search facilities cost approximately $200000 to develop plus around $100000 was spent recently to improve the sitersquos usability This compares to the previous low cost database which together with the printed guide cost less than about $80000 per annum The low cost version lacked the automation was only updated annually and did not have the ability to compared vehicles

The manufacturers provide the data on line using special access codes This data is checked by DOTARS before it is uploaded onto the website It takes close to a full time position within DOTARS to administer the website and respond to website related queries

Market Research and Marketing

Before the new greenvehicleguidegovau website was launched DOTARS commissioned consumer surveys to determine the level of knowledge about the environmental impacts made by vehicles This research showed that around half of those surveyed had the belief that ldquoall new cars have the same level of impact on the environmentrdquo

It became apparent through the surveys that there was a need to provide consumers with meaningful information on the relative performance of different vehicles This was a view shared by the Productivity Commission who said that while markets provide extensive information to consumers regarding fuel consumption of motor vehicles ldquothe Australian Governmentrsquos Fuel Consumption Labelling Scheme and Green Vehicle Guide provide relatively low cost accessible and comparable information to consumers and may be justified as part of the more fundamental objective of encouraging consumers to reduce the adverse environmental impacts of motor vehicle userdquo The Productivity Commission also commented that government

67

sources of information of this type were seen as credible and reliable and held in higher regard than information provided by others

DOTARS has scheduled some follow up consumer research for 200062007

DOTARS has spent about $600000 in marketing the Green Vehicle Guide This has included advertising in weekend guides in newspapers developing facts sheets plus targeted marketing to motor vehicle journalists

Summary Website - voluntary but legislative base

4 Government-Industry Partnership programs

Government-Industry Partnerships are the basis of many environmental initiatives and can take a number of forms Industry and government negotiate the terms of the program which are normally detailed in a formal agreement which sets out the environmental objectives and the responsibilities of each party towards their achievement

The GovernmentIndustry Partnership programs outlined below indicate the varied nature of these initiatives

41 The National Packaging Covenant

The National Packaging Covenant (the Covenant) commenced in 1999 and is a voluntary agreement between all levels of government and companies throughout the packaging chain including raw material suppliers packaging producers and retailers The Covenant commits signatories to the implementation of best practice environmental management in areas such as packaging design production and distribution and research into life cycle issues Signatories to the Covenant produce action plans on the measures they will implement to reduce packaging waste and they report annually on their progress In this sense the Covenant provides flexibility to signatories to develop plans suitable to their own circumstances The Covenantrsquos success (it currently has over 600 signatories) is due to the active promotion of it by Government and key industry players

The Covenant is complemented by a regulation the National Environment Protection (Used Packaging Materials) Measure (the NEPM) which enables states and territories to use enforcement action to require companies that donrsquot sign the agreement to take steps to reduce their packaging waste Preceding the Covenant and the NEPM were a number of voluntary industry agreements but these were limited in scope and largely focused on companies in the beverage industry

42 National Industry Reduction Agreement

The Publishers National Environment Bureau (PNEB) was formed in 1990 as an association of the major publishers of newspapers and magazines in Australia to promote the recovery and recycling of old newspapers and old magazines primarily from community kerbside collections organised by local councils

68

The PNEB and a newsprint manufacturer have voluntarily entered into a series of five-year Industry Waste Reduction Agreements with the Commonwealth and State Governments Under the current (third) plan 2001-2005 newsprint recycling in Australia has grown to 754 nationally in 2005 from the 28 level when the PNEB was formed in 1990

43 StateLocal target based programs

There have been a number of agreements signed by state government departments and an industry group where there is a stated goal to reach a specific environmental target For example in the early 1990s there was a voluntary agreement with the EPA Victoria and companies in the Altona Chemical Complex in the western suburbs of Melbourne (which includes Australian Vinyls BASF Dow Chemicals and Qenos) to reduce hydrocarbon emissions by 50 within a specified timeframe The target was met and further emissions reductions were negotiated The NSW EPA-Oil industry petrol volatility agreement outlined below is another example of a target based program

44 NSW EPA-Oil Industry Memorandum of Understanding on Summer Petrol Volatility

In 1998 NSW established arrangements for the supply of low volatility petrol in summer in the Sydney Greater Metropolitan Region implemented through a Memorandum of Understanding between the then EPA and oil companies The principal reason for controlling petrol volatility in summer is to reduce evaporative emissions of VOCs (from vehicles and production and storage sites) which contribute to ozone formation

The Memorandum of Understanding operated over four summer periods from 1998 to 2002 and involved companies voluntarily reducing petrol volatility (measured in kilopascals (kPa) of vapour pressure) over three summer periods from a base of 76kPa to 70kPa in the first summer 67kPa in the second and 62 kPa in the last two years

Although the Memorandum of Understanding was successful in progressively reducing petrol volatility over the period of its operation it was not supported by all industry members Consequently agreement was reached with industry that summer petrol volatility limits should be regulated to ensure a level playing field for all industry participants and regulated limits will apply from the summer of 200405

69

5 Summary of Australian Benchmark Programs

Program National State

Summary of Approach Impact

Voluntary Programs Altona Chemical Complex (Vic)

Local Small industry group worked towards self determined targets

Very high

Energy Star National Standards based label Limited Gas appliance Rating Scheme

National Industry operated labelling scheme with stars assigned therefore has graded benchmarksminimum performance standards out dated web database being developed

Low

National Industry Reduction Agreement

National Small industry group worked towards negotiated targets

High

NSW EPA-Oil Industry MOU

State Small industry group worked towards negotiated targets but not all involved ndash lead to regulations

Moderate

Top Energy Saver Award

National Achievement based label Limited

Quasi Regulatory Green Vehicle Guide

National Well promoted web database star ratings assigned therefore has graded benchmarks data provided voluntarily but backed by ADR requirements

High

Stand-by power National Required to achieve voluntary targets or regulation will be introduced

Unknown

National Packaging Covent

National Performance based targets backed by legislation High

Regulatory Energy Efficiency Labels

National Labelling scheme with stars assigned therefore has graded benchmarksbased on Australian Standard web database

High

MEPS National Sets base benchmark and works with energy rating

High

WELS Scheme National Labelling scheme with stars assigned therefore has graded benchmarksbased on Australian Standardweb database

High

Wood heaters State Only one benchmark assigned regulations are not uniform

Moderate

authorrsquos assessment based on direct or indirect knowledge of these programs

70

Appendix 3 Productivity Commission Comments on Labelling and Minimum Performance Standards

The Productivity Commission an independent agency which is the Australian Governmentrsquos principal review and advisory body on microeconomic policy and regulation recently examined the cost effectiveness of improving energy efficiency As part of its review lsquoThe Private Cost Effectiveness of Improving Energy Efficiencyrsquo it examined labelling programs minimum mandatory energy efficiency requirements and other means of providing consumer information The final report contains some highly relevant material that is applicable to establishing a benchmarking scheme for small engines

The following is a summary of relevant conclusions from the Inquiry

Government Operated Labelling Schemes

From consumer research provided to the Commission it concluded that ldquothere is some evidence to suggest that consumers are now paying more attention to labels than they have in the pastrdquo

The Commission was positive about labelling programs as labels

bull directly address ldquoa source of market failure mdash the asymmetry of information between buyers and sellers of energy-using productsrdquo

bull provide information to the consumer that is readily-accessible and easily-understood and therefore can assist in helping the consumer make better-informed choices

bull are likely to have produced net benefits for consumers

bull do not directly limit consumer choice

bull could provide a greater incentive for suppliers to sell products that use energy cost effectively

bull probably produced net social benefits

bull are most suited where there is a wide spread in the range of performances of comparable appliances and where information failures are most pronouncedrdquo

bull can be used to warn consumers that an appliance is very inefficient (through a disendorsement label) which could be effective in discouraging but not preventing consumers from buying the poor performing product

The Commission was supportive of Governmentrsquos role of drawing together and packaging information through labelling programs as this ensures that ldquorelevant and trusted information gets to those who would otherwise not get itrdquo In material reviewed by the Commission George Wilkenfeld and Associates and Energy Efficient Strategies (1999) claimed that labelling is unlikely to be effective if purchasers rarely inspect appliances in a showroom where they can compare performance across

71

different models or the purchaser is not the ultimate user and so has little interest in operating costs

Labelling programs involves both administration and compliance costs such as those incurred by suppliers in having their products tested but the Commission considered that labels should be more actively considered as an alternative to minimum performance standards

Minimum Performance Standards

Governments can prevent the sale of inefficient products by using minimum standards for example the Minimum Energy Performance Standards (MEPS) that apply to appliances such as refrigerators and freezers air conditioners and electric water heaters If appliances do not meet the minimum standard they cannot be sold in Australia Some appliances are covered by both MEPS and by labelling (for example refrigerators)

The Commission considered that MEPS and labels can be complementary as MEPS act to penalise the worst energy performers whereas labels rewarding the better performers

Costs comparisons of schemes

The Department of the Environment and Water Resources provided details about the costs involved in administering both the labelling scheme and the minimum performance standards for energy programs It stated that

bull the administration costs of MEPS are substantially lower than for labelling but the compliance costs can be higher

bull MEPS can have a greater cost for suppliers than labelling since suppliers must adjust their model ranges to meet the MEPS levels by the given date These compliance costs are however influenced by the lsquolead inrsquo time between the introduction of the regulatory proposal and the implementation of the MEPS

bull it is estimated that the administration costs for MEPS would be $3 million over the period 2000ndash15 compared to $39 million for labelling (in present value terms) (George Wilkenfeld and Associates and Energy Efficient Strategies 1999) Furthermore it was assumed that 84 per cent of administration costs were borne by appliance purchasers with the remainder borne by governments

It estimated that MEPS would increase the cost of appliances by $266 million over 2000ndash15 compared to $688 million for labelling (the latter cost being due to consumers voluntarily purchasing more efficient appliances)

72

Page 13: Outdoor Garden Equipment - Department of the Environment

four stroke motors Victa Lawncare is currently undertaking research and development to improve the environmental performance of two stroke carburettors and while some emission improvements have been made a two stroke compliant with US or European standards is still considered several years away

Four stroke carburettor engines are generally quieter more fuel efficient and are less polluting than conventional two stroke engines

Direct fuel injection (dfi) either two stroke or four stroke overcomes the unburnt fuel problem and can meet the stringent regulated exhaust emission limits that apply overseas However there is not any evidence that dfi engines are being used in outdoor garden equipment available in Australia It appears that engines used in outdoor garden equipment in Australia are generally restricted to two and four stroke carburettor engines

Small engines are not as advanced in environmental terms as motor vehicle engines As a result even the better-performing small engines emit far greater quantities of pollutants per hour than typical modern car engines For example the US Environmental Protection Agency (USEPA) 2002 limit for a typical 4 kilowatt (kW) lawnmower motor is about 66 grams (g) of regulated pollutants per hour of operation A typical 08kW brushcutter sold new in 2002 emitted about 160grams of pollutants per hour - reducing to 40grams per hour if bought new in 2006 The equivalent limit for cars under Australian Design Rule 79 is about 16g per hour In other words operated over a similar time one hour of operation of a brushcutter that meets USEPA 2002 limits produces the same pollution as ten cars and a 4kW lawnmower the same pollution as four cars These comparisons are subject to differences in test methods but they do provide an indication of the disproportionate amount of pollution emitted by small engines

Engines that do not comply with current USEPA requirements are likely to emit several times the amount of pollution calculated in the above example Therefore the worst performing engines are likely to emit some ten times the emissions of the best performers

Because of the combustion of oil these engines also emit high levels of particles Although small engines only contribute a small amount to total particle emissions the rate of particle release compared to other engines can be very high For example lawnmowers can emit over 10 times more particles (in terms of grams per hour) than a petrol motor vehicle (manufactured between 1994 and 2001)

All the above emission comparisons between outdoor garden equipment engines and motor vehicles are subject to differences in test methods but they indicate the disproportionate amount of pollution emitted by small garden equipment engines It also needs to be recognised that motor vehicles in Australia average more than 15000 kilometres per year (ABS 2003) while the annual average use of outdoor garden equipment is around 25 hours for a lawnmower and less for other types of equipment Commercial operators however are likely to have a much higher usage rates than the general public

2

This paper examines the Australian market for small engines used in lawnmowers and handheld garden equipment their impact on air quality relevant overseas regulations and their applicability to Australia and makes recommendations to reduce air quality impacts from these engines

A wide range of information sources has been referenced for this report including data and information supplied by manufacturers distributors and dealers in small engines

3

2 Air Quality and Outdoor Garden Equipment Engines

Emission inventories make estimates of emissions of substances from a multitude of sources into airsheds The National Pollutant Inventory (NPI) which is run cooperatively by the Australian state and territory governments contains data on 90 substances that are emitted to the Australian environment The substances included in the NPI have been identified as important because of their possible health and environmental effects Industry facilities estimate their own emissions annually and report to states and territories Non-industry (or diffuse) emissions estimates which includes emissions from outdoor garden equipment are made by the states and territories on a periodic basis using information sources such as surveys databases and sales figures

The NPI only reports emissions from domestic lawn mowing and for a few airsheds the contribution made by public open space lawn mowing It does not report on the contribution made by other types of outdoor garden equipment such as brushcutters National and selected state NPI emissions estimates for the common air pollutants and for Air Toxics NEPM pollutants from domestic lawn mowing are summarised in Table 1 It should be noted that national emissions from lawn mowing are underestimates as the NPI records emissions for major airsheds only and therefore is not Australia wide plus the estimates do not include evaporative emissions from fuel tanks and hoses

This NPI data is indicative only as the accuracy and completeness of the data sets varies across airsheds and is reliant on the estimation techniques used For example while the population in the NSW is higher than other airsheds its emissions look disproportionally high when compared to the other airsheds This could be because the estimation technique varies or it is due to some other factor

4

Table 1 National Pollutant Inventory Domestic Lawn Mowing Emission Estimates

Substance Port Phillip

Population 34 mill (1996)

SE Qld

Population 23 mill

NSW GMR

Population 47 mill

Adelaide

Population 10 mill

National

Common Air Pollutants (tonnesyear)

Carbon monoxide 12000 12000 24000 6100 69000

Total Volatile Organic Compounds 3600 3800 7000 2000 21000

Particulate Matter 100 um 86 94 170 9 460

Sulphur dioxide 5 5 9 50 81

Oxides of Nitrogen 63 54 120 24 330

Air Toxics (tonnesyear)

Benzene 230 210 390 130 1200

Formaldehyde 56 38 NA 31 180

Polycyclic aromatic hydrocarbons 07 11 21 04 41

Toluene (methylbenzene) 370 360 660 210 2000

Xylenes (individual or mixed isomers) 270 260 490 150 1500

Analysis of the NPI database at the national level shows that domestic lawn mowing is the

- Fourth largest source of benzene contributing 7 to the total reported airshed load

- Fourth largest source of formaldehyde contributing 3 to the total reported airshed load

- Fifth largest source of xylene contributing 6 to the total reported airshed load

- Fifth largest source of toluene contributing 6 to the total reported airshed load

- Sixth largest source of carbon monoxide contributing 12 to the total reported airshed load

- Ninth largest source of VOCs contributing 3 to the total reported airshed load when biogenics (natural sources such as trees and soil) are excluded

The NSW Department of Environment and Conservation has been upgrading its emissions inventory Based on 2003 emissions data non-road anthropogenic sources

5

contribute 619 of the VOCs to the GMR airshed Preliminary results2 indicate that VOC emissions from domestic and public open space lawn mowing contributes on an annual average 41 of all VOC emissions in the GMR On a typical weekend during warmer weather this percentage rises to 11

Therefore it could be assumed that lawn mowing could contribute approximately 4 on average to VOC emissions from anthropogenic sources in major airsheds in Australia when public open space lawn mowing is included This percentage is likely to rise significantly in the warmer spring and autumn weekends which is when lawns and other vegetation grow faster and when more people garden

21 Air Quality Standards

In June 1998 the National Environment Protection Measure for Ambient Air (Air NEPM) established national uniform standards for ambient air quality for the six most common air pollutants ndash carbon monoxide nitrogen dioxide photochemical oxidants (measured as ozone) sulfur dioxide lead and particles less than 10 microns (PM10) The NEPM was varied in 2003 to include PM25 advisory reporting standards and in April 2004 a National Environment Protection Measure for Air Toxics was adopted

Nationally the common pollutants of most concern (particularly in major urban areas) are fine particles and ground level photochemical smog (measured as ozone) which is formed in the warmer months when volatile organic compounds (VOCs) and oxides of nitrogen (NOx) react in the atmosphere under the influence of sunlight in a series of chemical reactions

Recent health studies (cited in NEPC 2005) have strengthened the evidence that there are short-term ozone effects on mortality and respiratory disease The studies also strengthen the view that there does not appear to be a threshold for ozone below which no effects on health are expected to occur In recent years Australian epidemiological studies have been conducted which confirm the results of overseas studies that there is a relationship between elevated ozone levels and hospitalisations and deaths from certain conditions

There are two national ozone standards a one hour standard of 010ppm and a four hour standard of 008ppm with a goal that allows for one exceedance per year by 2008 Sydney experiences a number of days each year of ozone levels above these standards In 2003 Sydney exceeded the one hour standard on 11 days in 2003 19 days in 2004 and 9 days in 2005 The four hour standard was exceeded on 13 days in 2003 19 days in 2004 and 13 days in 2005 Further reductions in VOC and NOx emissions are needed to reduce ozone concentrations in Sydney to levels that would comply with the Air NEPM

The other jurisdictions meet or are close to meeting the current National Environment Protection (Ambient Air Quality) Measure (Air NEPM) ozone standards (NEPC 2005) However the ozone standards are being reviewed and based on current human health evidence the argument appears to be strengthening for tighter ozone standards

2 Presentation to Expert Panel 27 April 2006 by Nick Agipades Manager Major Air Projects NSW DEC

6

Should a stricter standard or an eight-hour standard consistent with international standardsguidelines be adopted achievability of Air NEPM ozone standards or goals could become an issue for some of the other major urban airsheds (NEPC 2005)

Modeling of ozone for Sydneyrsquos Greater Metropolitan Region (GMR) indicates that the implementation of Euro emission limits for on-road vehicles and hence the increased presence of these less polluting vehicles in the fleet and retirement of old more polluting vehicles from the fleet is not sufficient to meet the current NEPM goals Modeling suggests that very large reductions in precursor emissions would be required to meet the current ozone one hour goal (NEPC 2005)

Even when the effects of bushfires and when hazard reduction burning are taken into consideration airsheds such as Launceston Melbourne and Sydney struggle to meet the national standards for particles (EPA 2006) However outdoor powered equipment predominantly from two stroke engines makes only a minor contribution to ambient fine particle loads

While carbon monoxide emissions from engines used in outdoor garden equipment are regulated overseas air monitoring in Australia indicates that carbon monoxides levels are well below the national air quality standards and there are no pressing issues requiring CO from outdoor powered equipment to be regulated In addition data indicates that lowering emissions of VOCs and NOx from small engines reduces CO emissions

Many of the pollutant sources which contribute to the formation of ozone and to particle levels also contain air toxics such as benzene toluene formaldehyde and xylenes These air toxics have been shown to be responsible for a range of health problems including asthma respiratory illnesses and cancer The National Environment Protection Measure for Air Toxics requires each jurisdiction to monitor and report annually on five air toxics benzene polycyclic aromatic hydrocarbons formaldehyde toluene and xylenes The monitoring data is intended to inform future policy and also the public on ambient levels of these air pollutants Monitoring of air toxics to date shows that levels are low and below the national monitoring investigation levels (EPA Vic 2006 DEC 2006)

7

3 Emission Standards for Small Engines

31 Australia

At present there are no Australian regulations or standards to limit air pollutant emissions from small (two and four stroke) engines Australia does benefit to some extent from overseas regulations as many lawnmowers and other gardening equipment sold in Australia have engines manufactured in the United States or Europe where strict standards apply

32 United States

In the United States emission regulations set by the United States Environmental Protection Agency (USEPA) and the Californian Air Resources Board (CARB) apply to lawn mowers and other powered gardening equipment Although CARB standards currently tend to be stricter than USEPA standards by 2006 emissions limits applying under the two standards will be very similar

United States Environment Protection Agency (US EPA)

In 1995 the USEPA introduced ldquoPhase 1rdquo regulations covering small non-road engines with a power of not more than 19kW (25HP) The regulations applied to equipment manufactured from 1997

These regulations have seven classes of equipment based on portability and engine displacement volume (ldquocapacityrdquo) In March 2000 the USEPA published ldquoPhase 2rdquo regulations which are shown in Table 2 These set limits for combined emissions of hydrocarbons (HC) and oxides of nitrogen (NOx) and separate limits for carbon monoxide (CO) emissions and for two stroke engines only particles

Table 2 US EPA Phase 2 Small Engine Emissions Standards (HC+NOx in gkW-hr) (a) (b)

Small Engine Class

Type 2002 2003 2004 2005 2006 2007+

I-A (lt66cc) Non-handheld (eg lawnmowers)

- 161 161 161 161 161

I-B (66 to lt 100cc) - 161 161 161 161 161

I (100 to lt 225cc) - 161 161 161 161 161

II (225cc or more) 180 166 150 136 121 121

III (lt20cc) Handheld (eg trimmers)

238 175 113 50 50 50

IV (20 to lt50cc) 196 148 99 50 50 50

V (50cc or more) - - 143 119 96 72 (a) As carbon monoxide (CO) levels in Australia are well below the Air NEPM standard the

USEPA emission limits for CO have not been included in this table (b) Includes useful life criteria of 50125300 hours

8

When the USEPA introduced ldquoPhase 2rdquo regulations it included averaging banking and trading provisions (ABT) which were seen ldquoas an important element in making stringent Phase 2 emissions standards achievable with regard to technological feasibility lead time and costrdquo (USA 1999) The USEPA also claimed (USA 2000) that the ABT program secures early emissions benefits through the early introduction of cleaner engines

ABT provisions which apply to handheld and non handheld engines are complex but in broad terms averaging means the exchange of emission credits among engine families within a given engine manufacturerrsquos product line This allows a manufacturer to produce some engines that exceed the standards and offsetting these exceedances with emissions from engines that are below the standard Manufacturers are allowed to exchange credits from handheld to non handheld and vice versa Banking means the retention of emission credits by the engine manufacturer generating the credits for use in a future model year (for averaging or trading) Trading is the exchange of emission credits between engine manufacturers which then can be used for averaging purposes banked for future use or traded to another engine manufacturer

In January 2004 USEPA reported that in 2002 averaging was being used but there was very little use of banking It determined that the initial ABT programs as too complex and included discount rates on credits ABT was simplified in 2004 including the elimination of credit discount and multipliers and limits on credit life To date there has reportedly been limited use of banking however it is anticipated that there will be more widespread use of banking credits if the USEPA proposed Phase 3 comes into effect3 (see below)

Particulate limits (2gkW-hr) also apply to two stroke engines Carbon monoxide and durability limits (or useful life) are also prescribed The durability criteria which were introduced in Phase 2 require that the emission limits must be met through the useful life of the engine The manufacturer determines useful life of each product using standardised product testing procedures and then based on the test results selects the useful life category for each product which can be 125 250 or 500 hours These durability criteria acknowledge the large disparity in usage patterns by equipment type and between commercial and residential users It also takes into account the ability of manufacturers to design and build engines for various design lives and which fit the types of equipment engine is produced for

The March 2000 USEPA report (USEPA 2000) estimated that the expected effects of the Phase 2 regulations would be

bull A 70 reduction in HC+NOx beyond the Phase I standards (which were estimated to have reduced emissions by 32 from the unregulated baseline)

bull A 30 reduction in fuel consumption of small handheld equipment bull Price increases of between $US23 (Class III) and $US56 (Class V) for

handheld equipment

3 Dave Gardner Briggs and Stratton email 22506

9

The US EPA is currently considering lsquoPhase 3rsquo regulations which are catalyst based standards to further reduce exhaust HC and NOx emissions from non handheld engines reduce evaporative HC and NOx emissions for both handheld and non handheld engines plus include extended durability criteria These limits are currently at discussion stage only They align with CARB Tier 3 but a longer lead time is proposed

Table 3 Proposed Phase 3 Exhaust Emissions

HC+NOx gkW-hr

CO gkW-hr

Year Useful life hrs

Class I 100 610 2010 125250500

Class II 80 610 2011 2505001000

Class III-V No changes

HC+NOx std is based on averaging

Californian Air Resources Board (CARB)

Spark ignition engines

CARB regulations first introduced emission limits for small engines manufactured from1995 The more recent schedule of emission limits are shown in Table 4 These limits depend solely on the engine capacity and apply to both handheld and non handheld classes

Table 4 CARB Emission Limits for Small Engines (HC+NOx in gkw-hr)

Engine Capacity 2000-2001 2002-2005 2006+

65cc or less 72 72 72

gt65cc to 225cc 161 161 161

gt225cc 134 121 121

California has particle limits for two strokes useful life criteria and mandatory engine labeling including a consumer advisory hang tag as shown in Figure 1 The USEPA is also considering introducing an air index label

10

Figure 1 Example of a Californian Consumer Advisory Hang Tag The Californian regulations take into account sales weighted emission performance for families of engines An engine family is essentially the same engine being used in different equipment items

In 2003 California adopted a Tier 3 program for exhaust and evaporative emissions and these are based on the use of catalytic convertors The engine classes better align with US EPA categories however the exhaust standards for Class I and Class II are more stringent than the existing US EPA standards

Table 5 CARB Tier 3 for Exhaust Emissions

Model Year Displacement Category

Durability Periods (hours)

HC+NOx gkw-hr

CO gkw-hr

Particulate gkw-hr

2005 and subsequent

lt50 cc 50125300 50 536 20 + 50-80 cc inclusive 50125300 72 536 20 +

2005 gt80 cc - lt225 cc Horizontal-shaft eng

125250500 161 549

gt80 cc - lt225 cc NA 161 467 Vertical-shaft Engine 225 cc 125250500 121 549

2006 gt80 cc - lt225 cc 125250500 161 549 225 cc 125250500 121 549

2007 gt80 cc - lt225 cc 125250500 100 549 225 cc 125250500 121 549

2008 and subsequent

gt80 cc - lt225 cc 125250500 100 549 225 cc 1252505001000 80 549

the 1000 hours is applicable for 2008+ Model Year (MY) + applies to 2 stroke only Source California Exhaust Emission Standards and Test Procedures For 2005 And Later Small Off-Road Engines Adopted July 26 2004 effective on October 20 2004

California also has Blue Sky provisions These are voluntary standards for engines that meet the criteria shown in Table 6 Blue Sky Series engines are not included in

11

the averaging banking and trading program Zero-emission small off-road equipment (eg push mowers) may certify to the Blue Sky Series emission standards

In 2005 CARB aligned its test procedures with the USEPA

Table 6 CARB Blue Sky Provisions

Model Year Displacement Category

HC+NOx gkw-hr

CO gkw-hr

Particulate

2005 and subsequent lt50 cc 25 536 20

50 - 80 cc inclusive 36 536 20

2007 and subsequent gt80 cc - lt225 cc 50 549

2008 and subsequent 225 cc 40 549 Applicable to all two stroke engines

33 Canada

The Canadian small engine market has similarities to the Australia market the majority of small engines are imported from the USA and there is one Canadian manufacturer of small spark ignition engines and one major manufacturer of lawn and garden machines

A Memorandum of Understanding (MOU) which came into effect on 1 January 2000 was signed between Environment Canada and ten manufacturers of handheld equipment and nine manufacturers of engines used in non handheld machines The MOU was intended as an interim measure until regulations could be put in place Under the MOU the manufacturers agreed to voluntarily supply small spark ignition engines designed to meet the applicable USEPA Phase 1 emission standards

In 2003 Canada regulated emission limits for handheld and non-handheld small engines based on USEPA emission limits The regulations apply to model years 2005 and later While there are no separate averaging banking and trading provisions in Canadian regulations Canada allows any USEPA certified engine to be sold in Canada This means that engines that do not meet the standard level but are averaged (or use credits) in the United States can be sold in Canada Manufacturers are required to produce upon request evidence of conformity to the standards and are required to provide written instructions on engine maintenance to the first retailer

12

Table 7 Canadian Small Spark-Ignition Engine Exhaust Emission Standards

Engine class

Engine Type

Engine Displacement (cm3)

Effective date (model year)

Standard HC+NOx (gkWshyhr)

Standard NMHC+NOx (gkW-hr)

Standard CO (gkWshyhr)

I-A Non-handheld lt66 2005 and

later 50a -shy 610a

I-B Non-handheld

lt100 and 66

2005 and later

40a 37a 610a

I Non-handheld

lt225 and 100

2005r 161b 148a 519b 610a

II Non-handheld 225 2005 and

later 121a 113a 610a

III Handheld 20 2005 and later 50a -shy 805a

IV Handheld lt50 and 20 2005 and later

50a -shy 805a

V Handheld 50 2005 2006 2007 and later

119a 96a

72a

-shy-shy

-shy

603a 603a

603a a Standards apply throughout the engine useful life b Standards apply only when the engine is new Source Canada Gazette Part II Vol 137 No 24 2003-11-19

34 Europe

In 1998 the European Union introduced exhaust emission limits for small petrol engines through Directive 9768EC and in 2002 introduced amendments through Directive 200288EC The limits in the Directives align with the US regulations however they do not have averaging and banking provisions

Table 8 European Emissions Standards

Small Engine Class Type (HC+NOx in gkW-hr) 2004 2005 2006 2007 2008

SN1 (lt66cc) Non-handheld (eg lawn mowers)

161 161 161 161 161

SN2 (66 to lt 100cc) 161 161 161 161 161

SN3 (100 to lt 225cc) - - - 161 161

SN4 (225cc or more) - - 121 121 121

SH1 (lt20cc) Handheld (eg trimmers)

- - - 50 50

SH2 (20 to lt50cc) - - - 50 50

SH3 (50cc or more) - - - - 72

13

The European Union is currently considering including useful life criteria and averaging and banking provisions plus it is considering introducing a Directive to further reduce emissions from diesel engines The objective of the proposal is to tighten emissions standards for engines in general non-road applications in light of technological developments and it taking into account the parallel developments for similar legislation in the United States in order to harmonise the environmental standards and to facilitate trade

Charts comparing the USA Californian and European Emission Limits are shown below

14

35 Summary of Regulations for Non Handheld Equipment

KEY TO CHARTS

USEPA CARB EU

0

10

20

30

40

50

60

70

80

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

0 to 49cc

0

10

20

30

40

50

60

70

80

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

50 to 65cc

0

2

4

6

8

10

12

14

16

18

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

100 to 224cc

0

2

4

6

8

10

12

14

16

18

20

2000

2002

2004

2006

2008

Year Model

HC

+N

Ox g

kW

-hr

225cc and over (up to 19kW)

15

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

2000

2001

2002

2003

2004

2005

2006

2007

2008

36 Summary of Regulations for Handheld Equipment

KEY TO CHARTS

USEPA CARB EU

20 to 49cc 0 to 19cc

250 250

200

150

HC

+N

Ox g

kW

-hr

100

200

HC

+N

Ox g

kW

-hr

150

100

50 50

0 0

Year Model Year Model

50 to 65cc 66 to 80cc

160

160

140

140

120

40 40

20 20

0 0

120

HC

+N

Ox g

kW

-hr

HC

+N

Ox g

kW

-hr

100100

8080

60 60

Year Model Year Model

16

Summary of Regulations for Handheld Equipment (continued)

KEY TO CHARTS

USEPA CARB EU

0

20

40

60

80

100

120

140

160

2000

2001

2002

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

81 to 224cc

0

20

40

60

80

100

120

140

160

2000

2001

2002

2003

2004

2005

2006

2007

2008

Year Model

HC

+N

Ox g

kW

-hr

225cc and over (up to 19kW)

17

4 Australian Market for Small Engines

41 Likely compliance with overseas emissions standards

As part of this assessment an environmental profile of equipment currently on the Australian market has been developed initially based on information from manufacturersrsquo brochures and web sites and industry magazines and then confirmed through follow-up with relevant industry contacts

Each item of equipment has been assessed on its compliance with USEPA CARB or European regulations In most cases it was not possible to match models available on the Australian market with CARB lists (CARB publishes exhaust emissions data on all appliances on its web site) This was mainly due to the inconsistency of model designations and uncertainty about ldquoengine familiesrdquo

Engine characteristics and retail price were difficult to obtain Some brochures also made claims of compliance with USEPA European or CARB requirements The detailed breakdown of current equipment on the Australian market is given in Appendix 1

The majority of small engines sold in Australia are imported and many come from countries that impose emission limits The extent of imports into Australia that do not comply with the country of origin standards is not known Industry estimates that 40 of garden products are sold through importers who are not linked to manufacturers of US EPA or European certified equipment and the source of some products sold here is difficult to establish Victa is the only company producing small engines in Australia Its iconic 2-stroke lawnmower currently cannot meet overseas emission limits

Outdoor Power Equipment Association (OPEA) assisted in identifying the Australian distributors of most brands of powered garden equipment In April 2006 a survey form was sent to a total of 43 distributors representing 97 brands of equipment The survey form sought information about the engine for all petrol-fuelled garden equipment with a power not more than 19kW

Figure 2 Extract from survey form

18

Initial response to the survey was poor Despite follow-up action and efforts from the industry association at the beginning of September 2006 26 distributors had responded to the survey information and only 13 distributors provided all data necessary for benchmarking purposes This resulted in emission compliance data for about half of the estimated products on the Australian market Attempts to match Australian models with the database maintained by the Californian Air Resources Board were also of limited success due to inconsistencies in model designations between Australia and the USA and the manner in which model information is coded in the CARB database

Table 9 Summary of distributor responses

Responses status Not OPEA OPEA ALL

Number of responses 9 8 (31) 17 (40)

Response - all data 4 9 13 (30)

Response - extra time sought 3 3 (7)

Response - no petrol products 4 1 5 (12)

Response - some data 5 5 (12)

Grand Total 17 26 43 percentages may not add to 100 due to rounding

Of the 97 brands initially identified

bull 16 brands are apparently no longer sold in Australia

bull No responses were received for 29 brands

bull Partial data were received for 12 brands

bull All data was available for 30 brands

Table 10 Summary of responses by brand

Count of brands

Analysis status Not OPEA OPEA All

Missing some data 12 12

No data received 9 (27) 20 (31) 29 (30)

No longer sold 13 3 16

Response - no models to list 3 7 10

Response received (electronic form) 5 11 16

Response received (paper form) 3 2 5

Response received (spreadsheet) 9 9

All 33 64 97

A 2004 report for the NSW DEC estimated that there were about 1200 eligible garden

19

products in the Australian market The current project has obtained data for a total of 870 products or 72 of the estimated population In addition the sampling method is likely to be biased towards products with good environmental performance In these circumstances the following analysis should be regarded as indicative only

Survey results

The following tables and figures show expected compliance with European CARB or USEPA requirements based on the limited information provided by industry

Table 11 Engine type and compliance with overseas standards Count of products Engine type

Best STD 2c 4c Unknown All 1997 - US EPA I 53 32 85 (10) 200288EU 17 17 (2) 2004 - US EPA II 1 3 4 (lt1) 2004 EURO I 8 8 (1) 2005 - US EPA II 10 29 5 44 (5) 2006 - US EPA II 107 141 2 250 (29) 2006 EURO I 6 6 (1) 2007 - US EPA II 1 1 (lt1) 2007 Euro II 2 2 (lt1) None 118 90 208 (24 Unspecified 24 60 161 245 (28) All 344 358 168 870

Unknown means the type of engine is unknown (but is most likely to be 2c) Unspecified means that the status of emissions compliance was unable to be identified None means the manufacturerdistributor has indicated that the equipment does not comply with any overseas emissions standard

Figure 3 Compliance with overseas standards - all surveyed products Note Unknown in chart includes unspecified and unknown from Table 11

20

Figure 4 Compliance with overseas standards by equipment type ldquoPhase 1 equivrdquo means the engine complies with US EPA phase 1 or 200288EU ldquoPhase 2 equivrdquo means the engine complies with US EPA Phase 2 Euro I or Euro 2 ldquoUnknown means that engine cycle (stroke) was not provided

Of the 41 categories of equipment in the survey 15 had at least 10 current products Results for these categories are set out below

Figure 5 Engine type for popular categories

21

Figure 6 Compliance with overseas standards for popular categories ldquoPhase 1 equiv means the engine complies with US EPA phase 1 or 200288EU Phase 2 equiv means the engine complies with US EPA Phase 2 Euro I or Euro 2 ldquoUnknown means that engine cycle (stroke) was not provided

42 Australian Sales of Outdoor Powered Equipment

The Australian Outdoor Power Equipment Association (OPEA) whose membership represents about 80 of the manufacturersdistributors and dealers in the industry commissions regular independent industry audits of garden equipment sales (OPEA personal communications) Sales data from OPEA is shown in Table 12

22

Table 12 Sales of outdoor garden equipment 2002 and 2005-06 2005-06 2 stroke (1000)

2002 2 stroke (1000)

2005-06 4 stroke (1000)

2002 4 stroke (1000)

2005-06 TOTAL (1000)

2002 TOTAL (1000)

Walk behind mowers 72 170 351 76 424 246

Brushcuttertrimmer 321 12 17 180 339 192

Chainsaws 152 0 0 90 152 90

Chipper shredders 0 60 46 0 46 60

Blowerblower vacuums 98 0 11 50 109 50

Ride on mowers 0 25 51 0 51 25

Generators 11 32 96 0 107 32

Hedge trimmers ampothers 40 192 0 28 40 220

694 491 476 424 1267 915

for total sales 593 463 407 537

for mowers 152 280 848 720

According to OPEA approximately 424000 walk behind lawnmowers and more than 792000 units of outdoor handheld equipment were sold in Australia in 2005-06 In addition there were sales of about 80000 replacement engines and 70000 pumps in 2005-06 most of which were four strokes These figures show that there has been considerable growth in the sales of most products with the exception of chipper shredders and the category lsquohedge trimmers and othersrsquo whose sales declined in 2005shy06 compared with those in 2002 About 17 of walk behind lawnmowers were two stroke and 83 four stroke which is an improvement in the uptake of cleaner engines when compared to 2002 when about 30 were two stroke The situation with handheld equipment is reverse with nearly 79 being two strokes compared to 47 in 2002 However many models of two stroke handheld equipment meet current US emission standards and care should be exercised in using engine type (two stroke or four stroke) as an indicator of emissions performance for this class of equipment

The OPEA 2005-06 sales estimates are shown in Figure 7 OPEA cautions that there is considerable uncertainty about the estimates for brushcutters and blowerblower vacuums as OPEArsquos figures only represent 50 and 60 respectively of sales of these products No estimates of future sales trends were identified during research for this project

23

Australian sales of 2 and 4 stroke outdoor equipment 2005-6

0 50 100 150 200 250 300 350 400

Walk behind mowers

Brushcuttertrimmer

Chainsaws

Chipper shredders

Blowerblower vacuums

Ride on mowers

Generators

Other

Annual sales (x 1000)

4s 2s

Figure 7 OPEA estimates of equipment sales in 2005-06 Note Blowervac is an industry term for equipment that combines blowing and vacuuming functions

Briggs and Stratton (Australia) who import engines from the USA supply the majority of the four stroke engines for handheld equipment sold in Australia and these comply with all the current USA and CARB regulations Imported handheld garden equipment is shipped fully assembled to a branch or distributor and is then sent to a retailer The retailer may or may not provide equipment servicing

OPEA members have expressed concern regarding the increasing sales of imported high polluting two stroke engines that allegedly do not meet any emission standards and come from countries that do not have emission standards One industry representative reported that some of the imported trimmers were being manufactured in China using outdated designs and tooling from two old bankrupt American companies and these are being sold here at about 30 of the price of traditional brands and very low cost generators from China now account for around 70 of total sales It is difficult to confirm this trend without undertaking a detailed examination of Australian import data however the significant increase in the sales of two stroke handheld equipment provides some support for this trend

On the other hand it is claimed by industry that the ride on mower market (predominately with compliant four stroke engines) has been stimulated by the Australian USA free trade agreement

24

5 Australian Users of Small Engines This section examines the market segments for garden equipment and customer purchasing behaviour

51 General Public

Purchasing behaviour

Research into consumer purchasing behaviour has found that consumers assess a product against a range of attributes for example price weight brand reputation servicing and parts availability warrantees and guarantees experience size promotions and discounts Studies have also revealed that up to 82 of Australians had bought products on the basis of social or environmental factors in the previous year (State Chamber of Commerce 2001) Related to this point the energy star rating ecolabel on whitegoods was viewed as a credible environmental claims system which is well regarded by the general consumer (Product Category Manager Mitre 10 personal communications)

As the purchase of small engine garden equipment by the general consumer is an infrequent purchase which carries a certain of amount of risk With small engines the risk can be functional risk (will not perform as expected) physical risk (for example safe features such automatic cut out on an electric lawn mower) or financial risk especially for the more expensive items The general consumer is likely to lessen the risk by seeking information and by evaluating the information on the available products over a period of time The consumer may also lessen the risk by

bull purchasing well known brands

bull buying the brand offering the best warrantees and guarantees

bull buying the most expensive brand and

bull buying a brand they have used before

Research indicates that the desired attributes of a product may not be well established at the start of a consumerrsquos search process but will often be refined as the consumer learns more about the product The consumer will also use a ranking and weighting process based on desired qualities and trade offs may be made

Reportedly purchases of engine operated garden equipment are based on price yard size fitness for purpose and other features such as weight and ease of starting (Product Category Manager Mitre 10 personal communications) Males are the predominant purchasers of garden equipment however because of changing demographics there has been an increase in the number of women purchasing these products

Less than 5 of lawnmowers purchased are push or electric mowers (Product Category Manager Mitre 10 and industry sources personal communications 2003)

25

Electric mowers are generally perceived as not being as effective as cords have limited range and rechargeable electric mowers require frequent recharging

There is a recent trend towards ride on mowers (all four strokes) probably because of changing demographics specifically older age groups moving to more rural environments with larger yards (OPEA personal communications)

A study (Wilkie 1994) investigated consumer appliance purchasing behaviour and found that the general consumer consulted a range of information sources before purchasing an appliance The appliance salesperson was found to be the most important information source for many consumers Other important information sources include newspaper advertisements friends and relatives catalogues consumer reports and brochureslabels Since Wilkiersquos study the internet will have become increasingly important as a research tool and in some instances as a way to purchase products As part of this study there is evidence of low priced products being sold into the Australian market via the internet only ndash a practice that is likely to increase in the future It was difficult to source any compliance or details on these products

At the retail chain level staff product training is generally voluntary undertaken out of store hours and as an inducement to attend training sessions suppliers usually provide incentives for staff Retail chain purchases are very price driven although some chains are reportedly interested in stocking goods that have credible environmental claims (Mitre 10 and other retail chain sources)

IBIS (2006a) reports that the domestic hardware sector which is dominated by Danks (Home Timber and Hardware Thrifty - Link Hardware and Plants Plus Garden Centre) and Bunnings is classified as a growth market and the sales of lawnmowers and other lawn and garden machinery and equipment represent about 14 of sales revenue

In summary it appears that a range of product attributes influences consumer purchases of lawnmowers and outdoor equipment Currently there is very little information about emissions in any of the information sources a consumer is likely to consult when purchasing these products Nevertheless surveys indicate that consumers are concerned about the environment and are open to including environmental considerations into their purchase decision Educating sales staff about the air emissions from lawnmowers and outdoor equipment together with ecolabels could therefore be important methods for influencing consumers towards the purchase of cleaner products

Equipment Usage

The USA Outdoor Power Equipment Institute CARB (cited in USEPA 1998) and the USEPA (USEPA 1998) have made estimates of annual usage rates and average life spans of outdoor equipment for the general consumer user and for the commercial user Table 13 gives USA usage and lifespan range for selected items of powered equipment

26

Table 13 USA Average Usage and Lifespan of Outdoor Garden Equipment For General Consumers and Commercial Users Equipment Annual usage (Hours) Lifespan (years)

General Consumer

Walk- behind mowers 20-25 6 -7

Rear engine ride on mowers 4 6 -7

Chainsaws 7 5-9

Leaf blowers 9-12 5-9

Trimmers 10 5-9

Commercial User

Walk- behind mowers 320 27

Rear engine ride on mowers 380 38

Chainsaws 405 1-13

Leaf blowers 170-293 18-28

Trimmers 170 - 275 15-28

Discussions with members of the Australian industry confirm that Australian hours of use are likely to be similar to the American estimates although this can vary depending on location For example in tropical areas lawns are mowed more often because they grow faster in this climate The American turnover of equipment is however probably higher than here as the Australian consumer tends to keep their equipment longer and so the useful life of a mower is more likely to be on average 10 ndash12 years

52 Garden and Ground Maintenance Services

According to a recent IBIS report (2006b) the revenue for this industry in 2005-06 was $383 million and the industry outlook is lsquobrightrsquo with a predicted annual average 5 growth over the next few years The Australian customer base for garden maintenance services including for lawn mowing is

Households 55 Business 25 Government 20

The sector is reportedly a growth industry due to

bull the aging population

bull the increasing numbers of households that are time poor income rich and

bull the growing trend for professional landscaping which requires a higher level of garden maintenance

27

The main customer base for these businesses includes middle to upper socioeconomic groups the aged and people who are physically disabled Growth is predicted particularly for the franchise industry with demand from the commercialindustrialgovernment sectors (IBIS 2003) A 1999 ABS survey reported that nearly one-third of older people purchased at least one domestic service per fortnight with gardening assistance being the most common This accords with an industry estimate that about 25 of householders pay someone to mow their lawn (Jim Penman Jimrsquos Mowing personal communication) The industry is sensitive to economic conditions and weather for example the drought has slowed growth over the last few years

The garden maintenance sector is dominated by small independent operators with two major franchisers Jimrsquos Mowing and VIP VIP nationally has 600 franchises and Jimrsquos Mowing about 400 Jimrsquos Mowing reportedly mows about 15000 lawns and has 53 of the market (IBIS 2006b) As franchised lawn mowing services represents about 14 of the lawn mowing services nationally it can be estimated that approximately 280000 lawns are mowed nationally by commercial operators

Jimrsquos Mowing and VIP provide training and advice to new franchisees on equipment including proper maintenance schedules Training generally occurs before franchisees purchase their equipment Most franchisees equipment would consist of two mowers a brushcutter an air blower and possibly a hedge trimmer or chain saw Operators prefer four stroke mowers and these are used for an average eight hours per week Brushcutters are generally two strokes as are other motors (IBIS 2006b and Jim Penman personal communication)

From the above it is estimated commercial operators operate mowers for up 34 million hours per year (or 8 of the total estimated mowing hours per year) and purchase approximately 66000 lawnmowers annually (25 of purchases) The sectorrsquos purchases of brushcutters is estimated to be approximately 8000 units per year or 37 of purchases Table 13 provides US commercial userrsquos annual average hours of use and average equipment life spans ndash it would be anticipated Australian rates would be similar

The main businesses contracting to provide ground maintenance services to the corporate and government sector (including universities) are Spotlessrsquos Open Space Management Transfield and Programmed Maintenance Services all of which are diversified publicly listed companies plus the Danish owned company ISS (previously Tempo Services) (IBIS 2003 and 2006b and company websites) The type of services they provide means it is likely they would have an array of equipment and a preference for the more powerful ride-on mowers and for Class V handheld equipment

53 Government Purchasing

The way purchasing decisions are made by government or other large organizations is generally very different to the approach taken by the general household consumer

bull many of the purchases are for large quantities of goods

28

bull there are well established policies and procedures in place to guide purchasing with the purchase criteria established early in the buying process and

bull those making the purchase are likely to be more knowledgeable about the product than the average consumer and they are usually not the eventual user of the goods

Value for money fitness for purpose ability to supply and over recent years environmental aspects are likely to be important factors in the purchasing decision for Government

Local State and Commonwealth Governments have responsibility for the upkeep of public assets many of which include public open space and other outdoors areas At the State and Federal level these include schools universities sporting facilities hospitals and defence facilities These services may be outsourced individual departments may undertake maintenance and purchase their own equipment or they may purchase equipment through a central purchasing facility With the central purchasing facility these items are generally purchased under contract While there is an increase in the inclusion of environmental considerations in the selection criteria for purchasing goods and services especially under contract these considerations mainly relate to waste management and recycling criteria and not air emissions

Local councils in some states for example NSW generally take responsibility for ground maintenance within their council areas or for some smaller councils the service may be contracted to a neighbouring council In other states such as Victoria there is a trend to outsource ground maintenance contracts to commercial providers

It is unknown what proportion of total sales that direct Government purchases represent however it likely to represent a relatively small share of several percent of the overall market

In summary

bull The general household consumer represents the major market segment for garden equipment accounting for up to 90 of product sales

bull Government is likely to be relatively small direct purchaser of garden equipment

bull Commercial garden services to households purchase approximately 25 of lawnmowers per year and 37 of brushcutters

bull Large ground maintenance companies are likely to prefer larger and more powerful equipment such as ride-on mowers

29

6 Result of Stakeholder Consultation

61 Regulations

The Small Engine Expert Panel ndash Outdoor Equipment considered in depth an approach to take to improve the emissions performance of outdoor garden equipment sold in Australia Discussions were particularly focused on the growing influence of cheap high emissions imported products together with the difficulties that the local manufacturer of lawn mowers is likely to face in complying with the relevant overseas standards As part of this process the industry representatives on the Panel held additional discussions and they consulted international industry experts at the manufacturing level in Europe the USA and Japan

OPEArsquos preference is for the adoption of regulations based on the USEPA standards with Phase 1 being adopted possibly from as early as 2007-08 The industry then proposes that Phase 2 be introduced in 2012 Phase 1 USA EPA standards were adopted in the USA in 1995 to be applied to equipment manufactured from 1997 and Phase 2 standards were introduced in 2002 through to 2007 and these included averaging banking and trading provisions A comparison between the USA Phase 1 and Phase2 standards is given in Table 14 The USEPA is discussing Phase 3 limits for the adoption in 20102011 which includes tighter exhaust emission limits for non-handheld equipment

The emissions limit of the two stroke lawn mower manufactured by the sole Australian manufacturer are well above USA Phase 1 limit for non-handheld equipment One avenue to address this issue which was supported by the Expert Panel ndash Outdoor Equipment would be to place lawn mowers in the US EPA Category 5 (engines gt50cc) This would result in emissions for two stroke lawnmowers being limited to 161 gkW-hour HC + NOx compared to the USA regulated limit of 161 gkW-hour HC + NOx Doing this would align the ramp-up timetable for mowers with that of other garden products

Table 14 Comparison between the USA Phase 1 and Phase 2 standards

Emission Limits GkW-hr

Phase 1 (1997 ndash2001) Phase 2 (2007) HC NOx HC+NOx CO HC+NOx CO

Non-handheld I-A lt66cc 161 610 I-B 66-lt100cc 161 610 I 100-225 cm3 161 519 161 610 II 225 cm3 134 519 121 610 Handheld III lt20 cm3 295 536 805 50 805 IV 20-50 cm3 241 536 805 50 805 V 50 cm3 161 536 603 72 603

Phase 2 limits were phased in between 2002 -2007 during which time they became tighter for simplicity only the 2007 are shown in this table (see Table 2 for more details)

30

In addition to limiting emissions the Expert Panel support the inclusion of the durability criteria which apply in the USA under Phase 2 standards and certification documentation from either the USA or Europe as adequate proof of conformity Equipment that has not been tested and certified to USA or European standards will be required to have the engines tested in a NATA certified laboratory

Some in the industry argued that regulations should include provisions for averaging for companies that wish to use it however they felt banking and trading provisions would not be necessary Industry representatives were not supportive of any Australian consumer labeling requirement instead OPEA members are willing to supply emissions data for inclusion in a web-based database that would allow purchasers to assess the environmental credentials of different makes and models

62 Discussion on recommended regulations

Timing of introduction

Some industry representatives argue that introduction of Phase 1 standards in 2007-08 will not give the industry an adequate transition period in which to develop competence in emissions certification establish new procedures and tooling in the dealers workshops train dealers and technicians on legal requirements distribute specific tooling and spare parts and reduce stocks of old (non certified) products without incurring an undue financial burden While others in the industry prefer progressing straight to phase 2 standards

If the OPEA preference for the adoption of the United States Phase 1 regulations which operated in the USA between 1995 and 2001 were introduced in Australia in 2007-08 they would be well behind the USA standards and worldrsquos best practice Furthermore the introduction of the United States Phase 2 - 2007 limits in Australia in 2012 would if the USEPA introduce Phase 3 in 2010-11 see emission limits for lawnmowers and other non handheld garden equipment in Australia still lagging United States standards and worldrsquos best practice

To introduce regulations in 2007-08 will require Government firstly to determine the most appropriate mechanism under which to enact the regulations draft the regulations prepare the regulatory impact assessment consult with the broader community and then finalise the regulations It is likely an Act of Parliament will be required at the Commonwealth level followed by complementary legislation at the State and Territory level It is possible for this to be achieved in less than a two year timeframe (as was the case for the Water Efficiency Labelling Scheme) However regulations that do not have a level of perceived urgency would take longer The level of importance and urgency to control emissions from small engines has yet to be debated and determined

31

Modified USEPA limits for lawnmowers

From the 183 lawn mowers identified through the market survey Victa is the main (possibly sole) provider of two stroke mowers with the other lawnmowers having cleaner four stroke engines

Victa is undertaking work to produce a cleaner product Victa estimates it would need a number of years to complete development production tooling and commercialisation of the cleaner engines In January 2007 it released a new two stroke carburettor lawnmower that has reduced engine emissions by more 30 but the combined HC and NOx emissions are still above USEPA Phase 1 limits Victa says this new engine is the outcome of four years of collaborative work by Victa and the University of Technology Sydney Victa is continuing with this research to further reduce emissions

A clause that allows exemptions to be granted as occurs in other countries could be included in the regulations however Victa argues that this would create uncertain trading conditions for the company for a period of time until an exemption were granted

Placing lawn mowers in the US EPA Category 5 (engines gt50cc) has the risk of opening the Australian market to more two stroke lawn mowers which has the greatest use of any outdoor powered equipment however it should see the continuance of the sole engine being manufactured in Australia In 1995 when it was introducing small engine emission limits the USEPA faced a similar issue with two stroke lawn mowers and used a similar approach by allowing two stroke lawn mowers to comply with the handheld standards It also specified that the number of two stroke lawnmower engines allowed to meet handheld standards would be subject to a declining annual production cap with the allowance provided by the production cap being phased out in 2003 There is also similar precedent for small engine emission limits that depend on engine type - European regulations for marine outboard motors set less stringent requirements for two stroke motors

Averaging Banking and Trading Provisions

The US EPA did not have averaging banking and trading provisions in Phase 1 and therefore all small outdoor engines were required to meet the Phase 1 limits It only introduced ABT provisions in the much more stringent Phase 2 as they would allow the most economic introduction of cleaner engines The industry claims the systems to use this provision are available and can be implemented in Australia by those who wish to use it at little cost to government

Industry claim that any supportive economic data related to averaging is sensitive and confidential It is there difficult without substantial justification by the industry to support the provision for averaging in conjunction with Phase 1 particularly given the elapsed time between the introduction of Phase 1 in the USA and their recommended introduction in Australia If there are some low volume equipment items that still cannot meet the USAEPA Phase 1 standards then these could be subjected to

32

exemptions if adequate justification can be provided (exemptions for small volumes were available under the USEPA regulations)

It was noted that for government to implement regulations a regulatory impact statement is required and this requires an assessment of the costs and benefits of the options considered with clear overall benefits shown for the preferred option Therefore if the option for manufacturers to use averaging were to be considered more information to support its inclusion would be required

Other options that could be considered to circumvent the inclusion of averaging include

i including clauses that give manufacturers the ability to apply for exemptions from the regulations for classes of equipment that have small sales volumes (these provisions are available in the USA)

ii limiting the regulation to popular types of equipment

iii using the end-of-model life provisions that have been used in the Australian Design Rules for cars In effect the end of model life provisions require new designs to comply from the implementation date but allow older models to remain on sale for a few more years This is an alternative to ABT because it facilitates earlier introduction of the regulation

iv Having a phase in period of say 2 years during which existing models can continue to be sold but new models coming on to the market must comply with the new standards At the end of the phase-in period all models must comply with the new standards This is an approach that is used when Australian Design Rules (ADRs) are introduced for motor vehicles

Consumer Information

Current Australian directions to reduce the environmental impact of consumer products favor tiered benchmarks using a lsquostarrsquo rating system (see Appendix 3 for examples such as the Mandatory Energy Efficiency Label and the Water Efficiency Labelling Scheme)

As products generally arrive in Australia assembled and packaged industry considers a mandatory requirement to label products with an Australian style star rating would impose a cost on distributors that would drive up the retail price of products Instead the OPEA members were willing to supply emissions data for inclusion in a web-based database that would allow purchasers to assess the environmental credentials of different makes and models Given the diverse nature of the industry it is unlikely a database would provide complete coverage of all products on the Australian market but inclusion in the database would indicate that the manufacturer has a commitment to environmental performance It was acknowledged in discussions that at least some Phase 2 compliant products would become available prior to 2012 and the web-based database would provide one method to promote those cleaner engines

33

In summary the Recommendations of the Expert Panel

1 Mandatory air pollutant emission standards to be introduced in Australia for all outdoor equipment (lt19kW) powered by spark-ignition engines The development of any regulation would need to be based on a formal assessment of the costs and benefits of nationally regulating 2 and 4 stroke lawn mowers and handheld power equipment which should be commenced immediately

2 Proposed standards to mirror US EPA regulations (compliance with equivalent EU regulations also acceptable)

3 Timing (subject to completion of assessment of costs and benefits)

(a) US EPA Phase 1 ndash Effective from 2007 2008

(b) US EPA Phase 2 ndash Fully implemented in 2012 (in step with 2007 USEPA limits) with phase-in period andor ABT over 2008-2012 to provide for early introduction of cleaner product

4 Walk-behind 2 stroke mowers to be included in US EPA Category 5 (gt50cc) product classifications Implementation timing to be as in Recommendation 3 above

5 All products also to be certified to relevant EPA durability categories

6 Subject to further review ABT (if included) may be phased out after 2012

34

7 The Way Forward

The optimum approach for garden equipment out engine emissions of options needs to be sustainable and cost effective This will need to be determined through a costs and benefits analysis (CBA) CBA assigns monetary values and typically assesses the impacts on the consumer on human health on the environment on industry and on government A detailed costs and benefits analysis is beyond the scope of this report however the following sections draws on available information to provide some indication of the possible costs and benefits that are associated with emissions from garden equipment engines

Air Quality Benefits

Environment Canada estimated the introduction of the regulations would result in a 44 percent reduction in combined HC+NOx emissions from small engines used in garden equipment and reduction in individual air pollutants over a 25 year period as shown in Table 15 The Canadian estimates incorporate the benefits that would accrue from the MOU signed with the industry in 2000 plus the benefits from the regulations introduced in 2003 In 2000 Canada imported around 13 million small spark-ignition engines and machines (ie a similar number to Australia) with 80 supplied by the USA

Table 15 Canadian Small Spark-Ignition Engine Emissions in Year 2025

Substance Base Case Emissions in 2025

Emissions in 2025 with Regulations

Percentage Reduction in 2025 (Regulations vs Base Case)

Criteria Air Contaminants (kilotonnes)

HC 772 410 469

NOx a 84 67 201

CO 1413 1403 07

Greenhouse Gas (kilotonnes)

CO2 2903 2645 89 Base case year 2000 (accommodating voluntary agreement) Source Canada Gazette Part II Vol 137 No 24 2003-11-19

Other Environmental Costs and Benefits

In addition to the human health benefits associated with reduced exposure to ozone there is a range of other public benefits including reduced damage to vegetation and therefore higher crop yields less damage to materials and structures particularly

35

some rubber products and improved visibility due to a reduction in smog haze Plus there are benefits associated with lower emissions of other air pollutants

To date there appears to have been little work undertaken in assigning a monetary value to these benefits as it is considered that they are likely to be small compared to human health impacts

Health Costs and Benefits

The Final Impact Assessment for the Ambient Air Quality National Environment Protection Measure (NEPC 1998) estimated that the health damage costs from exposure to ozone nationally to be in the range of $90 ndash $270 million (in 1998 dollars) This figure did not include mortality costs because of difficulty in assigning a figure to human life nor did it include costs associated with minor symptoms such as sore throat cough headache chest discomfort and eye irritation that can result from ozone exposure On the cost of ozone exposure the Impact Assessment states that lsquothe social well-being associated with potentially 6 and 20 million fewer irritating symptoms annually cannot be reliably quantified but at $1 a symptom it adds up to an appreciable amountrsquo

Since the Air NEPM Impact Assessment ozone levels in Australian urban areas have not fallen significantly but the population and medical costs have increased since then However using the above figures to make a rough estimate the contribution made by engines used in lawnmowers (ie not including other garden equipment) to the health damages cost from ozone exposure would be at a minimum $36 - $108 million not including the cost of mortality or minor symptoms As any action on these engines is likely to only remove high emission engines over a decade or more a CBA would be required to include an assessment of the proportional health benefits that would accrue from only removing the high emitters over time

Costs and Benefits to the Consumer

In 1995 the USEPA estimated that on average the cost to the engine manufacturer to install the necessary emission control technology to meet Phase 1 standards (which didnrsquot have ABT) would be approximately $US2 per engine used in nonhandheld equipment and $US350 per engine used in handheld equipment It also estimated that this would translate to sales-weighted average price increases of about $US7

The introduction of phase 2 regulations USEPA estimated would result in price increases of between $US20 and $US64 for handheld equipment depending on the equipment class (USEPA 2000) where handheld engines ranges in price from $60 to $1000 (USEPA 1995)

In addition to emission reductions the implementation of exhaust emission limits has the advantage of reducing fuel consumption and lowering operating costs to the consumer For example the USEPA estimated that for Phase 1 limits that applied between 1995 and 2001 on an average sales-weighted engine basis would decrease fuel consumption by 26 percent for non handheld equipment and a 13 percent decrease in fuel consumption for handheld equipment (USEPA 1995) Phase 2

36

(current limits) would result in a further decrease in fuel consumption of approximately 30 percent for handheld engines

When the USEPA considered the fuel savings offset and the retail price increase it estimated that the average sales-weighted lifetime increase in cost would be about $US650 per handheld engine while nonhandheld engines will realize a lifetime savings of about $US250 per engine This does not include the lifetime savings in maintenance costs which should further benefit the consumer (USEPA 1995)

Euromot (The European Association of Internal Combustion Manufacturers) claims that compliance with European minimum performance standards that do not have ABT provisions adds around 30 to the cost of some products that have had to be brought into compliance4 compared to products sold under the ABT system in the US

Costs and Benefits to Industry and Government

As there is only one local manufacturer among the 43 distributors of powered outdoor garden equipment sold in Australia and all others are importers the main costs to reduce the emissions contribution made by these engines will be associated with program administration and compliance particularly if regulations are introduced

The Productivity Commission an independent agency which is the Australian Governmentrsquos principal review and advisory body on microeconomic policy and regulation recently examined the cost effectiveness of measures to improve the energy efficiency in household appliances As part of its review lsquoThe Private Cost Effectiveness of Improving Energy Efficiencyrsquo it examined labelling programs (ie regulated tiered benchmarks) and minimum mandatory energy efficiency requirements (ie a regulated simple benchmark) While the household appliance market is considerably larger than the garden equipment market the Commissionrsquos final report contains some information that is useful for determining the approach that could be used to establish an emissions reduction scheme for garden equipment A summary of relevant sections of this report is provided in Appendix 3

The Commission identified both administration and compliance costs associated with labelling programs and minimum mandatory energy efficiency requirements as well the impacts these had on product suppliers

The Department of the Environment and Water Resources provided details to the Commission on the costs involved in administering both the labelling scheme and the minimum performance standards for energy programs The information provided showed that

bull the administration costs of the simple benchmark approach were substantially lower (less than one tenth) than for labelling and 84 per cent of administration costs were passed on to appliance purchasers with the remainder borne by governments

4 Presentation by Dr Holger Lochmann Rob Baker Axel Rauch Stihl 19 April 2006

37

bull the compliance costs for labelling are higher

bull minimum mandatory energy efficiency requirements can have a greater cost for suppliers than labelling since suppliers must adjust their model ranges to meet the MEPS levels by the given date These compliance costs are however influenced by the lsquolead inrsquo time between introduction and the implementation of the regulations

bull The increased cost to appliance purchasers of labelled appliances was about two and half times higher compared to appliances purchased under minimum mandatory energy efficiency requirements this being due to consumers voluntarily purchasing more efficient appliances

Overall the Commission considered that labels should be more actively considered as an alternative to minimum performance standards The Commissionrsquos support was based on the ability of labels to amongst other things

bull directly address ldquoa source of market failure mdash the asymmetry of information between buyers and sellers of energy-using productsrdquo

bull provide information to the consumer that is readily-accessible and easily-understood so they can help the consumer make better-informed choices

bull Have net social benefits and possibly have net benefits for consumers

bull provide a greater incentive for suppliers to sell environmentally better products

bull warn consumers through a disendorsement label that an appliance is very inefficient This approach can discourage but not prevent consumers from buying the poor performing product

71 Options to Reduce Emissions from Garden Equipment Engines

There is a range of options that could be considered for reducing emissions from engines used in outdoor garden equipment in Australia These include

1 Do nothing

2 Partnership Programs

3 Quasi regulation

4 Co-regulation

5 Regulations

In the following discussion about these options many Australian examples are mentioned Further details about these programs plus an overview are provided in Appendix 2

38

72 Option 1 ndash Do Nothing

Based on data supplied by OPEA the sales of high emitting two stroke carburettor engines as a percentage of engines used in outdoor equipment increased during the period 2002 to 2005-6 (see Table 12) from 463 to 593 and overall sales number increased by 38 during that period There is no indication that in the short to medium term that sales of equipment with two stroke carburetor engines will decrease in overall sales numbers or as a percentage of sales Therefore under the lsquodo nothingrsquo option emissions from outdoor garden equipment will continue at the same rate or perhaps based on sales figures of two stroke carburetor powered equipment at an even higher rate in the future

73 Option 2 ndash Industry - Government Partnership

In the discussion papers prepared for the NSW small engine project (2004) some examples of successful voluntary Government-Industry Partnership programs were provided The examples included were

bull the National Industry Reduction Agreement where the major newspaper and magazine publishers in Australia agreed to promote recovery and recycling of old newspapers and magazines

bull the NSW EPA-Oil Industry MOU on Summer Fuel the National Packaging Covenant (which has legislative backup) and

bull the EPA Victoriarsquos agreement with the Altona Chemical Complex

From the Australian programs reviewed it appears that the best indicators for successful partnership programs are

bull a relatively small number of firms within the industry

bull a commitment and involvement by all of the industry

bull clear program aims and objectives plus program targets and

bull a willingness by the industry to enter into a cooperative partnership with government

There are 43 identified distributors selling 97 brands of outdoor powered equipment in Australia Many of the major distributors are members of OPEA but there are many distributors who are not members It is therefore unlikely that the even the majority let alone all of the Australian distributors would commit to a industry-government partnership to reduce emissions

74 Option 3 - Quasi Regulation

Quasi regulations can take a range of forms the most usual being the establishment of a code of practice that industry endorses and implements A fundamental part of the code of practice would be emissions standards There are few examples of the use of codes of practice to limit emissions

39

Governmentrsquos role under this scenario is likely to be in assisting in the development of standards

The likelihood of this option being successful for similar reasons to the industry government partnership option is low

75 Option 4 -Co Regulation

Co-regulation is an agreement by industry and government to certain undertakings that support the uptake of cleaner products with a regulatory base It allows industry program flexibility to achieve certain negotiated targets Australian examples of coshyregulation include

bull The Green Vehicle Guide which operates through an industry government agreement where industry report test results to government in an agreed format within a certain timeframe Government manages the data and promotes the program This program is underpinned by Australian Design Rules for motor vehicles

bull The electrical appliance stand-by power program where there are agreed targets established that industry is required lsquovoluntarilyrsquo to meet failure to achieve the targets will result in regulation

bull The Packaging Covenant which is a program that allows industry the flexibility to design it own programs to reduce packaging waste and achieve certain target The Covenant is complemented by the NEPM on used packaging which specifies certain government responsibilities to support the program plus measures that will be introduced if targets are not met

Given the large number of distributors on the Australia market co-regulation for engines used in garden equipment using a similar form to the standndashby power program or the packaging program - an agreement by industry and government on a percentage reduction target for the sale of high emitting engines within a specified timeframe together with an agreement that regulation will be adopted if the target is not met ndash is also unlikely to be successful

76 Option 5 - Regulation

Regulation which requires a clear acknowledgement of a sufficient problem by Government places uniform mandatory compliance obligations on industry The costs associated with regulations are usually shared between government and industry with the development of regulations and program administration costs being borne by government with industry meeting compliance costs including emissions testing and if applicable labelling costs

It could argued that regulation should be introduced in the States or Territories where there are exceedances of the Air NEPM ozone standards However development of state based regulations for garden equipment engines emissions is unlikely as they would be incompatible with the 1992 Intergovernmental Agreement on the

40

Environment signed by the Commonwealth States and Territories and existing Commonwealth and State Government mutual recognition legislation The Intergovernmental Agreement on the Environment which underpins the development of National Environment Protection Measures obligates all jurisdictions to ensure equivalent protection from air pollution to all Australians

In addition enforcement of any state based legislation would be a key problem Under the Commonwealth Mutual Recognition Act 1992 and the Trans-Tasman Mutual Recognition Act 1997 goods that are imported into or produced in an Australian State or Territory or New Zealand that can be sold lawfully in that jurisdiction can be sold freely in a second jurisdiction even if the goods do not comply with the regulatory standards of the second jurisdiction This means non-regulated small engine products legally sold in one State could be legally sold in any other state regardless of whether emissions limits on small engines applied in that State

National regulation on the other hand would provide national consistency It would also provide the opportunity to adopt worldrsquos best practice standards and incorporate penalties for non-complying parties

Under the Australian Constitution the Commonwealth does not possess specific legislative powers in relation to the environment and heritage There are however a number of legislative powers that can support environment and heritage legislation Furthermore Commonwealth legislative powers can be used cumulatively For example the Commonwealth Parliament can make laws under section 51(20) of the Constitution with respect to ldquoforeign corporations and trading or financial corporations formed within the limits of the Commonwealthrdquo

Legislative mechanisms may also be created through the development of a National Environment Protection Measure (NEPM) that then becomes law within each jurisdiction A NEPM can accommodate flexibility of implementation where jurisdictions that have elevated ozone levels can tailor their NEPM program to their specific air quality needs An example of this flexible approach is the Diesel NEPM which has a suite of programs which can be implemented by jurisdictions

From the review of Australian regulations to reduce the environmental impacts of products and the overseas approaches to control emissions from small engines two regulatory approaches become apparent a simple benchmark or tiered benchmarks These are outlined below

Regulatory Option1 - A Simple Benchmark Approach

The most basic regulatory approach that could be taken would be to have a single emission standard (or as per the USA Europe and California a number of emission standards based on power and application) for combined HC + NOx emissions All equipment with new engines sold in Australia from the date the regulations are introduced This approach would

bull remove the all high emission engines from sale

41

bull be supported by an Australian Standard and

bull provide consumers with confidence that all products meet certain emissions standard

Regulatory Option 2 -Tiered Benchmarks

Current Australian directions to reduce the environmental impact of consumer products favour tiered benchmarks using a lsquostarrsquo rating system (see Appendix 2 for examples)

For engines used in garden equipment a tiered emissions labelling system could be based on the USEPA Phase 1 and Phase 2 standards use a system of lsquostarsrsquo to provide information to consumers about environmental performance but not limit consumer choice A tiered lsquostarrsquo system approach would

bull reward those products with more stars that meet the more stringent overseas standards

bull either operate with minimum emissions performance standards or disendorsement labels

bull be supported by a product label and possibly a web database

bull provide consumers emissions information and the option to purchase a lower emission engine

bull be supported by an Australian Standard and

bull be devised to meet worldrsquos best practice which is an overarching approach supported by Government

Table 16 summarises the main strengths and weaknesses of the above options

42

Table 16 Main Strengths and Weaknesses of Each Option

Strengths Weaknesses

Do Nothing Does not limit consumer choice Emissions contribution likely to grow No cost to government No barrier to new market entrants selling

high emitters Consumers have a wide choice of products Industry unchecked amp product dumping

likely No enforcement recourse on environmental grounds available

Partnerships Some sharing of responsibility government Slow if any reduction in high emitters

ndash industry

Potential for Government assist in Few if any companies likely to join and no advancing reductions in high emitters restrictions on non signatories Reduction targets set Below worldrsquos best practice

Quasi Regulation Similar strengths to partnership option Similar weaknesses to partnership option as

few if any companies likely to adopt code of practice

Co-Regulation Ongoing consultation between industry and Due to industry diversity targets unlikely to government recourse to regulation be met Targets set and can require new market Slow reduction in emissions entrants to achieve targets Can have implementation flexibility Emissions test standard adopted

Regulation Option 1- Simple Benchmark Worldrsquos best practice standards can be ovide incentives to manufacturers to promote low adapted and is mandatory emitters

Recourse to legal action available for non Does not provide consumers with emissions compliance information Significant quantifiable health benefits Cost of enforcement borne by taxpayers Requires compliance by all industry and High cost to government bans high emitters

Regulation Option 2 ndash Tiered Benchmarks Provides consumers with emissions information but does not limit choice Incentives for manufacturers to sell low emitters Potentially significant quantifiable health benefits Can be designed to overcome ABT issue

Significant administration and compliance costs to Government High cost to government and industry and will increase retail price of engines Does not ban high emitters

43

77 Preferred Approach

From the above discussion and from the review of garden equipment on available to the Australian consumer there are many companies selling powered garden equipment on the Australian market and the market is very competitive Furthermore from the Expert Panel discussions and stakeholder consultation it is apparent that it is highly unlikely that all the companies in the garden equipment industry would engage in or commit to a voluntary program to reduce their productsrsquo exhaust emissions It is therefore clear that the only feasible path to reduce emissions from these small engines is through regulation

While regulations of emissions from small engines used in garden equipment in Australia are likely to be based on overseas regulations they need to strike a balance between improved environmental outcome harmonisation with international standards and the characteristics of the local industry With regulation optimum emissions reductions are achievable especially by combining minimum emissions standards with tiered product labelling Whether this approach is justifiable on economic grounds that is the benefits outweigh the costs can only be determined through a detailed impact assessment Based on these findings it is recommended that a formal assessment of the costs and benefits of nationally regulating 2 and 4 stroke lawn mowers and handheld power equipment should now be commenced

44

References Air Resources Board California Environmental Protection Agency Californian Exhaust Emission Standards and Test Procedures for 2005 and Later Small Off-road Engines July 26 2004

Artcraft 2003 A Major Research-Based Review and Scoping of Future Directions for Appliance Efficiency Labels in Australia and NZ prepared for the Australian Greenhouse Office viewed at wwwenergyratinggovaulibraryindexhtml

Australian Bureau of Statistics 1999 Older People Australia A Social Report Report Number 41090 December 1999

Australian Greenhouse Office 2002 Achievements 2002 National Appliance equipment energy efficiency program Commonwealth of Australia

Australian Greenhouse Office 2002 Achievements 2002 National Appliance equipment energy efficiency program Commonwealth of Australia

AustralianNew Zealand StandardtradeASNZS 64002005 Water efficient productsmdashRating and labeling Federal Register of Legislative Instruments F2005L01571

Bei L T and Widdows R1999 Product knowledge and product involvement as moderators of the effects of information on purchase decisions a case study using the perfect information frontier approach Journal of Consumer Affairs 33(1) 165-186

Buy Recycled Busines Alliance Briefing Paper Environmental Claims And Labelling Abstract lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10-2003

California Code of Regulations 1998 Final Regulation Order Article 1 and Article 3 Chapter 9 Division 3 Title 13 Attachment 1 26 March 1998 wwwarbcagovregactsoreregs_finpdf

Canada Gazette Part II Vol 137 No 24 2003-11-19

Canadian Gazette 29 March 2003 Vol 137 No 13 Part 1 pp 935- 955

Cap Gemini Ernst amp Young (2001) Cars Online 2001 Global consumer survey httpa593gakamainet75931951a8b278a28319eawwwcgeycomhightechautomediaC ars_online2pdf

Clothes Washers Australiarsquos Standby Power Strategy 2002 ndash 2012 Standby Product Profile 200308 October 2003 wwwenergyratinggovau

Craig ndash Lees M Joy Sally Browne B 1995 Consumer Behaviour John Wiley amp Sons Queensland 1995

Department of Environment and Conservation NSW 2004 Measures to Encourage the Supply and Uptake of Cleaner Lawnmowers and Outdoor Handheld Equipment

45

Department of Environment and Conservation 2003 Who cares about the environment in 2003 A survey of NSW peoplersquos environmental knowledge attitudes and behaviours DEC Social Research Series

Department of Environment and Conservation Action for Air update 2006

Department of Environment and Conservation The Buy Recycled Guide Online Directory viewed at wwwresourcenswgovauindex-RNSWhtm

EcoRecycle 2004 Paint Take-Back Takes Off in Bayswater Media release 24 March 2004 viewed at wwwecorecyclevicgovau May 2004

Enviromower viewed at wwwenviromowercomau June 2004

Environment Canada 2000 Future Canadian Emission Standards for Vehicles and Engines and Standards for Reformulation of Petroleum Based Fuels Discussion Paper in Advance Notice of Intent by the Federal Minister of the Environment April 2000 wwwecgccaenergfuelsreportsfuture_fuelsfuture_fuels1_ehtm

Environment Canada 2004 Environment Minister Urges Canadians to Reduce Greenhouse Gas Emissions and Mow Down Pollution With Unique Incentive Program Media Release April 23 2004 viewed at wwwecgccamediaroomnewsrelease May 2004

Environment Protection and Heritage Council National Environment Protection (Ambient Air Quality) Measure Report on the Preliminary Work for the Review of the Ozone Standard October 2005

Environment Protection Authority 2006 Victoriarsquos Air Quality ndash 2005 Publication 1044 June 2006 wwwepavicgovau

Environmental Choice NZ 2001 Public Good and Environmental Labelling An Internal Background Paper

European Commission Directive 200344EC amending the recreational craft directive and comments to the directive combined 211005

George Wilkenfeld and Associates Pty Ltd with Artcraft Research and Energy Efficient Strategies Tomorrow Today 2003 Final Report A Mandatory Water Efficiency Labelling Scheme for Australia Prepared for Environment Australia June 2003

George Wilkenfeld and Associates 2003 A National Strategy for Consumer Product Resource Labelling in Australia prepared for the Australian Greenhouse Office December 2003 viewed at wwwenergyratinggovaulibraryindexhtml

Green Vehicle Guide wwwgreenvehicleguidegovau

Harrington L and Holt S 2002 Matching Worldrsquos Best Regulated Efficiency Standards ndash Australiarsquos success in adopting new refrigerator MEPS wwwenergyratinggovaulibrarypubsaceee-2002apdf

46

Harris J and Cole A 2003 The role for government in ecolabelling ndash on the scenes or behind the scenes lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10-2003

Holt S and Harrington L2003 Lessons learnt from Australiarsquos standards and labeling program Paper presented at ECEEE Summer Study - 2-6 June 2003 wwwenergyratinggovaulibraryindexhtml

IBIS 2006a Domestic Hardware Retailing 09-Jun-2006 Industry Code G523b

IBIS 2006b Gardening Services 18-Jan-2006 Industry Code Q9525

IBIS 2003 Gardening Services in Australia 23 December 2003 Industry Code Q9525

Lawrence K Zeise K amp Morgan P 2005 Management Options for Non-Road Engine Emissions in Urban Areas Consultancy report for Department for Environment amp Heritage Canberra

Motor Vehicle Environment Committee (MVEC) in consultation with the Department of Transport and Regional Services 2002 Proposal for an Australian ldquoGreen Vehiclesrdquo Guide viewed at httpwwwdotarsgovaumvegreen_vehicles_guidedoc May 2004

National Appliance and Equipment Energy Efficiency Committee The Energy Label at wwwenergyratinggovau (3504)

National Environment Protection Council 2005 National Environment Protection (Ambient Air Quality) Measure Report on the Preliminary Work for the Review of the Ozone Standard October 2005

National Environment Protection Council 1998 Final Impact Assessment for Ambient Air Quality National Environment Protection Measure June 1998

National Environment Protection Council 1999 Used Packaging Materials Impact Statement for the Draft NEPM Used Packaging Material January 1999 viewed at wwwephcgovau

National Environment Protection Council 2004 National Environment Protection (Air Toxics) Measure April 2004 viewed at wwwephcgovau

New South Wales Government 2002 Protection of the Environment Operations (Clean Air) Regulation 2002

New South Wales Government 1999 NSW Government Procurement Policy Statement White Paper 1999

Nordic Council 2002 Ecolabelling of marine Engines Criteria Document 8 December 1995 ndash 6 December 2005 version 35 December 2002

47

Office of Public Sector Information Statutory Instrument 2004 No 2034 The Non-Road Mobile Machinery (Emission of Gaseous and Particulate Pollutants) (Amendment) Regulations 2004 wwwopsigovuksisi200420042034htm

Outdoor Power Equipment Institute 2001 Profile of the Outdoor Power Equipment Industry wwwopeiorg

Productivity Commission 2004 The Private Cost Effectiveness of Improving Energy Efficiency Final report October 2005 wwwpcgovauinquiryenergy

Publishers National Environment Bureau Media Release lsquoAustralia leads the world in newspaper recyclingrsquo 6 June 2006 wwwpnebcomau

Real J Jones A 2005 The Green Vehicle Guide Clean Air Soceity of Australia and New Zealand Conference 2005 Hobart

Salmon G Voluntary Sustainability Standards and Labels (VSSLs) The Case for Fostering Them OECD Round Table On Sustainable Development

Schkade D A and Kelinmutz D N 1994 Information displays and choice processes differential effects of organization form and sequence Organizational Behavior and Human Decision Processes 57(3) 319-337

Stephens A 2003 Eco Buy (Local Government Buy Recycled Alliance Victoria) Abstract lsquoThe Future of Ecolabelling in Australiarsquo a conference organized by The Australian Ecolabelling Association and the Australian Academy of Science Canberra October 9-10shy2003

Teisl M F Roe B and Hicks RL 2002 Can eco-labels fine tune a market Evidence from dolphin-safe labeling Journal of Environmental Economics and Management 43339-359

Teisl M F Roe B and Levy A S Ecolabelling What does consumer science tell us about which strategies work pp141-150

The ISO 14000 family of standards guides and technical reports

The Parliament of the Commonwealth of Australia 2004 House of Representatives Water Efficiency Labelling and Standards Bill 2004 Explanatory Memorandum wwwcomlawgovauComLawLegislationBills1nsf viewed February 2006

Thogerson J 2000 Promoting green consumer behaviour with eco-labels Workshop on Education Information and Voluntary Measures in Environmental Protection National Academy of Sciences ndashNational Research Council Washington DC November 29-30

United States Environmental Protection Agency Federal Register Vol 60 No 127 3 July 1995 Control of Air Pollution Emission Standards for New Nonroad Spark-ignition Engines At or Below 19 Kilowatts wwwepagovEPA-AIR1995JulyDay-03prshy805txthtml

48

United States Environmental Protection Agency Federal Register Vol 69 No 7 12 January 2004 Rules and Regulations 40 CFR Part 90 Amendments to the Phase 2 Requirements for Spark-Ignition Nonroad Engines at or Below 19 Kilowatts Direct Final Rule and Proposed Rule wwwepagovfedrgstrEPA-AIR2004JanuaryDay-12a458pdf

United States Environmental Protection Agency Office of Pollution Prevention and Toxics Pollution Prevention Division 1998 Ecolabelling Environmental Labelling - A Comprehensive Review of Issues Policies and Practices Worldwide

United States Environmental Protection Agency Office of Transportation and Air Quality March 2000 Regulatory Announcement Final Phase 2 Standards for Spark-Ignition Handheld Engines

United States Environmental Protection Agency 1998 Proposed Phase 2 Emission Standards for Small SI Engines 27 January 1998

United States Environmental Protection Agency 2000 Regulatory announcement Final Phase 2 Standards for Small Spark-Ignition Handheld Engines March 2000 EPA420-F-00shy007

United States Federal Register Vol 69 No 7 Monday January 12 2004 Rules and Regulations Environmental Protection Agency 40 CFR Part 90 Amendments to the Phase 2 Requirements for Spark-Ignition Nonroad Engines at or Below 19 Kilowatts Direct Final Rule and Proposed Rule United States Federal Register Vol 64 No 60 30 March 1999 40 CFR Part 90 Phase 2 Emission Standards for New Nonroad Spark-Ignition Nonhandheld Engines At or Below 19 Kilowatts Final Rule pp15214-15216

United States Federal Register Vol 65 No 80 25 April 2000 40 CFR Parts 90 and 91 Phase 2 Emission Standards for New Nonroad Spark-Ignition Handheld Engines at or Below 19 Kilowatts and Minor Amendments to Emission Requirements Applicable to Small Spark-Ignition Engines and Marine Spark-Ignition Engines Final Rule pp24282-24284

United States Environmental Protection Agency Control of Air Pollution Emission for New Nonroad Spark-ignition Engines At or Below 19 Kilowatts Final Rule 40 CFR Parts 9 and 90 1995 wwwepagovEPA-AIR1995JulyDay-03pr-805txthtml

United States Environmental Protection Agency Office of Pollution Prevention and Toxics Pollution Prevention Division 1998 Ecolabelling Environmental Labeling- A Comprehensive Review of Issues Policies and Practices Worldwide

Victorian Government Greenhouse Strategy Community Action Fund - Mow Down Lawn Mower Rebate Exchange Program wwwgreenhousevicgovaucommunitygrantscafsuccessfulprojectshtm

Water Efficiency Labelling and Standards Act 2005 No 4 wwwcomlawgovauComLawLegislation

49

Water Efficiency Labelling and Standards Determination 2005 wwwcomlawgovauComLawLegislationLegislativeInstrument1nsf

Water Efficiency Labelling and Standards Regulations 2005 wwwcomlawgovauComLawLegislationLegislativeInstrument1nsf

Wilkie W 1994 Consumer Behaviour John Wiley and Sons NY as cited in Craig ndash Lees M Joy Sally Browne B 1995 Consumer Behaviour John Wiley amp Sons Queensland 1995

wwwenergyratinggovau

wwwgreenvehicleguidegovau

wwwwaterratinggovau

50

Appendix 1 Detailed Breakdown of Powered Garden Equipment on the Australian Market

The following table gives a profile of the current equipment on the Australian market It is based mostly on distributor responses to a survey and might not be representative of the total market

Low sales indicates that no sales data was available but volumes are likely to be small compared with popular equipment Phase 1 is US EPA Phase 1 or EU Directive 200288EU Phase 2 is US EPA Phase 2 or Euro standards

Type Ranges Stroke Aerator 5 makes 6 models Sales Low

Engine power 26 to 172kW Engine displ 143-674 ml

2c -4c 5 Unspecified 1 Phase 1 - Phase 2 4

Auger 3 makes 5 models Sales Low

Engine power 12 to 16kW Engine displ 31-ml

2c 5 4c -Unspecified -Phase 1 1 Phase 2 1

Backhoe 0 makes 0 model Sales Low

(2 models in 2003) -

Blower 13 makes 49 models Sales 109K

Engine power 07 to 31kW Engine displ 24-80ml

2c 34 4c 2 Unspecified 13 Phase 1 10 Phase 2 17

Blower-wheeler 3 makes 6 models

Engine power 07 to97kW Engine displ 24-305ml

2c 1 4c 4 Unspecified 1 Phase 1 3 Phase 2 -

Blowervac 6 makes 9 models Sales

Engine power 07 to 11kW Engine displ 24-34ml

2c 6 4c -Unspecified 3 Phase 1- Phase 2 3

Brush cutter 12 makes 95 models Sales 339K

Engine power 06 to 23kW Engine displ 21-54ml

2c 66 4c 5 Unspecified 24 Phase 1 15 Phase 2 34

Chainsaw 9 makes 106 models Sales 152K

Engine power 1 to 58kW Engine displ 26-122ml

2c 74 4c -Unspecified 32 Phase 1 18 Phase 2 27

Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

51

Type Ranges Stroke Clearing saw Engine power 14 to 27kW 2c 6 3 makes Engine displ 36-57ml 4c 0 9 models Unspecified 3 Sales low Phase 1 4 Phase 2 -Cultivator Engine power 07 to 52kW 2c 2 4 makes Engine displ 25-190ml 4c 5 7 models Unspecified -Sales low Phase 1 - Phase 2 5 De-thatcher Engine power 1kW 2c 1 1 makes Engine displ 27ml 4c -1 models Unspecified -Sales low Phase 1 - Phase 2 1 Drill Engine power 1kW 2c 3 3 makes Engine displ 27ml 4c -4 models Unspecified 1 Sales low Phase 1 - Phase 2 1 Edger Engine power 1 to 4kW 2c 12 10 makes Engine displ 24-190ml 4c 11 36 models Unspecified 1 Sales Phase 1 3 Phase 2 22 Garden tractor Engine power 12 to 157kW 2c -2 makes Engine displ 465 to 675ml 4c 5 12 models Unspecified 9 Sales low Phase 1 - Phase 2 3 Grass trimmer Engine power- 2c 3 1 make Engine displ 31ml 4c -3 model Unspecified -Sales Phase 1 - Phase 2 3 Hedge trimmer Engine power 06 to 1kW 2c 28 10 makes Engine displ 21-31ml 4c 1 42 models Unspecified 13 Sales 40K Phase 1 4 Phase 2 35 Lawnmower Engine power 26 to 66kW 2c 22 19 makes Engine displ 100-270ml 4c 151 183 models Price $449-$3609 Unspecified 10 Sales 424K Phase 1 95 Phase 2 48 Line trimmer Engine power 07 to 45kW 2c 25 8 makes Engine displ 24-195ml 4c 2 29 models Price $136-$299 Unspecified 2 Sales Phase 1 2 Phase 2 6 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

52

Type Ranges Stroke Log splitter Engine power 26 to 45kW 2c -1 makes Engine displ 100-195ml 4c 2 2 models Unspecified -Sales low Phase 1 - Phase 2 1 Multicutter Engine power 08 to 14kW 2c 17 5 makes Engine displ 23-36ml 4c 1 19 model Unspecified 1 Sales Phase 1 2 Phase 2 13 Olive nut shaker Engine power - 2c -1 make Engine displ - 4c -1 model Unspecified 1

Phase 1 - Phase 2 -Pole saw Engine power 08 to 14kW 2c 6 4 makes Engine displ 23-36ml 4c -10 models Unspecified 4 Sales low Phase 1 1 Phase 2 3 Power carrier Engine power 37 to 231kW 2c -2 makes Engine displ 160 to 953ml 4c 11 11 models Unspecified -Sales low Phase 1 - Phase 2 10 Power cutter Engine power 32 to 45kW 2c 5 2 makes Engine displ 64-99ml 4c -8 models Unspecified 3 Sales low Phase 1 1 Phase 2 3 Pruner (3 models in 2003) 2c -0 make 4c -0 models Unspecified -Sales low Ride-on-mower Engine power 26 to 231kW 2c -12 makes Engine displ 100 to 725ml 4c 93 124 models Unspecified81 Sales 51K Ph1 1 Ph2106 Rotary hoe (4 models in 2003) 2c -0 makes 4c -0 models Unspecified -Sales low Shredder Engine power 3 to 96kW 2c 1 6 makes Engine displ 126-389ml 4c 16 20 models Unspecified 3 Sales 46K Phase 1 - Phase 2 4 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

53

Type Ranges Stroke Stump grinder Engine power 96kW 2c -1 make Engine displ 389ml 4c 1 1 model Unspecified -Sales low Phase 1 - Phase 2 1 Tiller Engine power 08 to 59kW 2c -3 makes Engine displ 25-243ml 4c 8 9 models Unspecified 1 Sales low Phase 1 - Phase 2 7 Trencher Engine power37kW 2c -1 makes Engine displ 183ml 4c -1 models Unspecified 1 Sales low Phase 1 - Phase 2 1 Trimmer Engine power - 2c 10 2 makes Engine displ - 4c -21 models Price - Unspecified 11 Sales Phase 1 4 Phase 2 -Turfcutter Engine power 37kW 2c -1 makes Engine displ - 4c 1 1 models Unspecified -Sales low Phase 1 - Phase 2 -Vac Engine power 22 to 172kW 2c 1 5 makes Engine displ 158 to 674ml 4c 13 15 models Unspecified 1 Sales Ph11 Ph24 Vac chipper Engine power 34 to 45kW 2c -2 makes Engine displ 158-195ml 4c 3 3 models Unspecified -Sales low Phase 1 - Phase 2 1 Sales of brushcutters and trimmers combined Sales of blowers blowervacs and vac combined Sales of hedgetrimmers edgers and other handheld equipment combined

54

Appendix 2 Examples of Current Australian Benchmarking Programs

The following describes in varying degrees of detail a number of current Australian benchmarking schemes classified by program type simple bench mark approaches tiered benchmarks and government industry partnerships This appendix concludes with a summary table of these programs with an assessment of their effectiveness

1 Introduction

Simple benchmark schemes (described below) such as the woodheater standards set a single point hurdle rate whereas the green vehicle guide use tiered benchmarks The new water efficiency labelling scheme and minimum energy efficiency performance standards uses both a simple benchmark through minimum performance requirement plus tiered benchmarks incorporated into labels as lsquostarsrsquo Other approaches such as the stand-by power program and the Victorian Altona Complex VOC reduction target set goals for achievement within a specified time period Other approaches taken to reduce environmental impacts include the National Packaging Covenant which uses a program based on individual companies developing tailored approaches to suit their circumstances and is supported by enforcement capability through the National Environment Protection (Used Packaging Materials) Measure (the NEPM)

2 Simple Benchmarks

21 Minimum Energy Performance Standards (MEPS)

Purpose

MEPS prescribe a minimum allowed energy performance for specific appliances Appliances that are less efficient than the relevant standard are excluded from the market

Background and Strategy

In October 1999 as part of the National Greenhouse Strategy (1998) nationally consistent MEPS and labelling schemes were adopted across Australia

Independent NATA accredited laboratories undertake product compliance checks to see whether products perform in compliance with MEPS requirements For example

bull In 2003 the government conducted check tests on eight appliance models all of which were found not to meet the claims made on the energy performance labels Two products were deregistered one was found to have not been registered and action was pending on the remaining five products (AGO 2003b)

55

bull Other regulatory actions undertaken in 2003 included fines of $3000 and $8000 against two Western Australian retailers who were found to have sold appliances without energy performance labels Queensland and Victorian retailers received infringement notices and fines totalling $10 000 (AGO 2003b)

Summary RegulNated minimum performance standards based on an Australian Standard

22 Energy Star

Purpose

An endorsement label that indicates an electronic product has achieved a specified standard when it is not performing its core function (ie on stand by)

Background and Strategy

Energy Star is a voluntary endorsement labelling program developed by the US Environmental Protection Agency (US EPA) It has been operating in the USA since 1992 and has been adopted by a number of countries including Australia Energy Star sets voluntary standards for reducing the electricity consumption of electronic equipment when it is not performing its core function

The Government stand ndash by program which is outlined below complements the energy star labelling program

Summary Voluntary endorsement label

23 Woodheater Standards

Purpose

To reduce particle emissions through Australian Standard compliant woodheaters

Background and Strategy

Since 1992 Australian StandardNew Zealand Standards have been introduced to improve the performance of wood heaters

The first standard for wood heater emissions AS4013 (1992) was published in 1992 and was revised and published as a joint AustralianNew Zealand Standard in 1999 ASNZS4013 (1999) Domestic solid fuel burning appliances - Method for determination of flue gas emission This Standard provides a test method to measure particles emitted by residential solid-fuel burning heating appliances

56

The 1992 Standard included an upper limit for acceptable particle emissions of 55 grams of particles per kilogram (oven-dry weight) of fuel burnt This emission factor was reduced to 4 gkg in the 1999 revision of the Standard The Standard applies to solid-fuel burning space-heating appliances (including those fitted with water heating devices) with a heat output of 25KW or less It does not apply to masonry fireplaces cooking stoves central heating appliances or water-heating-only appliances

AS 4013 (1999) is complemented by ASNZS4014 (1999) Domestic solid fuel burning appliances - Test Fuels and ASNZS4012 (1999) Domestic solid fuel burning appliances - Method for determination of power output and efficiency

The woodheater industry was instrumental in initiating the development of standards and it lobbied states and territories to enact legislation to mandating that woodheaters be required to meet the standards As the health affects of particle pollution have become more apparent and as some jurisdictions are having difficulty in meeting national particle standards Government has become more proactive in controlling woodheaters and more supportive of tighter standards

All states and territories with the exception of South Australia have regulations that restrict emissions from new woodheaters although Victoria for example only introduced its regulations in 2004 compared to Tasmania who introduced regulations in 1993 These regulations require that new woodheaters comply with the Australian Standard ASNZS 4013 The State regulations however are not uniform

Many woodheaters that are currently certified for sale do not comply with the revised standard as verified in a National Woodheater Audit Program undertaken in 2004 Seven of the 12 wood heaters tested failed to meet the ASNZS 4013 particle emission limit In addition 55 of heaters were found to have deviations from the original designs and 72 had labelling faults that could adversely affect emissions performance

Testing and certification are administered by the industry association

Summary State and regulations requiring compliance with Australian Standards Certification administered by industry association

24 Standby Power

Purpose

To reduce lsquoexcessiversquo energy consumed in electrical appliance standby mode sold in Australia through in the first instance voluntary targets Appliances covered by the program range from information technology equipment such as PCs and photocopiers entertainment equipment such as TVs DVDs and sound systems major appliances such as water heaters dishwashers and refrigerators and small appliances such as smoke detectors and bread makers

57

Background and Strategy

In 2000 standby power was estimated to constitute 116 per cent of Australiarsquos residential energy use costing households over $500 million and leading to the emission of over 5 million tonnes of carbon dioxide equivalent (AGO 2002c) Holt and Harrington (2004) estimated that standby power consumption in Australia could be reduced by 56 per cent by 2020 (Productivity Commission 2005)

In August 2000 all Australian jurisdictions agreed to pursue efficiencies in standby power consumption of energy-consuming products through support for the International Energy Agencys One -Watt program and endorse its incorporation into theprogram of work

Australia reportedly has taken the lead on implementing the One- Watt program even though many of the products sold in Australia are imported

During 2002 government agencies consulted with stakeholders about ideas to reduce standby The standby strategy which proposed a list of targeted potential product types was presented to the Ministerial Council on Energy

In September 2003 an interim test method for the measurement of standby power ASNZS 62301-2003 (int) based on an internationally recognised standard was published Also during this period work commenced on developing draft product profiles for high priority targeted products

Once product profiles are completed interim voluntary date-specific targets are made The product sales are then monitored to determine progress towards the interim target If it is then determined that inadequate progress is being achieved by a significant number of suppliers then government will regulate

For example the interim 2007 target for clothes washers is as follows

Product Off mode power End of program mode

lt 1W lt 4 W

The National Standby Strategy Target to be achieved by 2012 for clothes washers is as follows

Off mode power End of program mode lt 03 W lt 1 W

In support of the clothes washer program Government will

bull consider creating a Government Purchasing Policy to buy low standby clothes washers where available and fit for purpose

bull collect data on all modes for new clothes washers and analyse trends

bull highlight the range of performances by publishing performance data on clothes washers on a website or by other means

58

bull progressively include standby energy consumption into the Comparative Energy Consumption for labelled products such as clothes washers and clothes dryers

bull work with the Standards Committees to finalise the details of modes and test methods for the relevant standards

bull determine in 2008 if progress is inadequate and if regulation is required

Summary Industry targets possible future regulation

3 Tiered Benchmarks

31 Mandatory Energy Efficiency Label ndash the Energy Star Programs

Purpose

To enable consumers to easily compare the energy performance of electrical appliances used by households and firms through a labelling scheme

Background and Strategy

Several Australian states commenced mandatory energy efficiency labelling for major appliances in the mid-1980s In 1992 it became mandatory across Australia for initially refrigerators and later freezers clothes washers clothes dryers dishwashers and air-conditioners (single phase only) to carry the label when they are offered for sale This labelling program is regarded as one of the most successful in the world (Wilkenfeld and Assoc 2003) It is administered through the Australian Greenhouse Office

The energy rating label for dishwashers

(ldquoa joint government and industry programrdquo) and a website address (wwwenergyratinggovau) and has two main features

bull the star rating which gives a quick comparative assessment of the models energy efficiency and

bull the comparative energy consumption (usually kilowatt hoursyear) which provides an estimate of the annual energy consumption of the appliance based on the tested energy consumption and information about the typical use of the appliance in the home These values are measured under Australian Standards which define test procedures for measuring energy consumption and minimum energy performance criteria Appliances must meet these criteria before they can be granted an Energy Rating Label

The Energy Rating Label includes an endorsement

59

Awards Brand ModelInstallat

ionType

Phase Available

10 Yr Energy

Cost StarRating

Output(kW)

TOSHIBA

Digital Inverter Series Air

Conditioner RAV-SM1102BT-

ERAV-SP1102AT-E (

RAV-SM1102BT-ERAV-

SP1102AT-E)

SingleSplit

SystemDucted

Single $1500 1000

CHUNLAN

KFR-32GWVWa (

NO)

SingleSplit

SystemDucted

Single $645 323

Since its introduction the star rating label seems to have established a high level of recognition with consumers Consumer research (Artcraft 2003) indicates that the different information on the label appeals to different consumer segments interested in purchasing an appliance

When a manufacturer gains approval to use the label they pay for and produce the label in accordance with specifications on size colours fonts layout and design A similar colour scheme and design to the energy consumption label is also used for the compulsory fuel consumption label on new passenger and light commercial vehicles

The labelling scheme is underpinned by regulation whereby regulated Minimum Energy Performance Standards (MEPS) provide the environmental benchmarks that the appliances are required to meet Appliances that do not meet the minimum energy performance standards can be withdrawn from the Australian market

When the energy rating program was reviewed in 2000 technology had advanced to the point where a large percentage of appliances had achieved the maximum number of stars so the rating system was tightened It is estimated that over the 25 year period 1980 to 2005 there will have been an overall reduction in energy consumption of around 70 by the most popular sized refrigerators (with freezers) (Harrington L and Holt S 2002)

In addition to the energy consumption label there is a website (wwwenergyratinggovau) with a comprehensive database of all appliances their star rating and energy consumption In 2002 there were around 220000 hits on the programrsquos various websites and 523000 in 2003 reportedly representing 80000 visits by individual inquirers The website hit rate is estimated to represent almost 10 of consumers who are considering purchasing an appliance (Holt et al 2003)

Cooling

Energy Input (kW)

250

104

Figure B Excerpt from Energy Rating web page for Air Conditioners (cooling cycle only shown)

When the energy rating program was reviewed in 2000 technology had advanced to the point where the Scheme had to be tightened because a large percentage of appliances had achieved the maximum number of stars For example energy use by refrigerators was around 70 compared to that used when the scheme started (Harrington L and Holt S 2002)

60

Regulations

State and Territory legislation refer to the relevant Australian Standards This approach simplifies the State and Territory legislation and makes it relatively straightforward to maintain national consistency of appliance and equipment energy efficiency standards even when standards are continually being revised

The testing procedures and technical requirements for the label and also Minimum Energy Performance Standards (MEPS see below) are incorporated into the applicable Australian Standards Products for sale must be registered with one of the State regulators

Program Administration

The labelling program and MEPS program are administered by the National Appliance and Equipment Energy Efficiency Committee (NAEEEC) which is ultimately directed by the Ministerial Council on Energy

Requirements for Appliance Suppliers

Appliance suppliers are required to

bull Submit applications for product registration and these must include a test report or other data to demonstrate that the appliance meets the relevant Australian Standard

bull While test reports on three separate units are required for most products there is no particular requirement for test laboratories to be accredited or products certified for registration for energy labelling and MEPS in Australia Test reports from the manufacturers laboratory are satisfactory However if there is evidence that results from a particular laboratory are unsatisfactory regulators can mandate test reports from an accredited laboratory

Summary Mandatory labelling scheme backed by regulations and an Australian Standard

32 Water Appliances Water Efficiency Labelling and Standards (WELS) Scheme

Purpose

A labelling scheme backed by legislation to promote domestic water efficient appliances

Background and Strategy

A voluntary water efficiency industry administered labelling scheme has been in existence since 1988 The water efficiency ratings and details on the label design are covered in ASNZS 6400 The main incentive of the voluntary lsquoAAAAArsquo scheme

61

has been the publicity and cash rebates offered by water utilities However the coverage water efficiency performance requirements and impact of this program have been limited

In 2003 the Environment and Heritage Ministers agreed to implement a national Water Efficiency Labelling Scheme (WELS) for products such as shower heads washing machines dishwashers and toilets Consultation with industry and stakeholders was undertaken in 2003 with a strategic study published that identified the products to be included in the new labelling Scheme A Regulation Impact Statement (RIS) which identified the costs and benefits of various options and made various recommendations was published in March 2004 Following public review of the RIS some modifications were made to WELS

The WELS Scheme is backed by the following legislation and standard

Water Efficiency Labelling and Standards Act 2005 which establishes

bull the products subject to the Scheme and the requirements for registration and labelling

bull the standards to apply to WELS products setting requirements for water efficiency performance registration and labelling of these products

bull enforcement provisions including penalties bull the appointment of inspectors to investigate possible contraventions and sets

out their powers and obligations bull review and dispute resolution bull a program Regulator bull the making of regulations bull a requirement for annual reports and for an independent review after five years

Water Efficiency Labelling and Standards Regulations 2005 which

bull prescribes the circumstances in which a person other than the manufacturer of a WELS product may be taken to be the manufacturer of the product (eg an importer)

bull sets out procedures for the issuing and the payment of penalty infringement notices as an alternative to prosecution for offences against the WELS Act

bull specifying the information to be included on an identity card issued to a WELS inspector

Water Efficiency Labelling and Standards Determination 2005 amongst other things determines and establishes product registration fees and calls up the Australian Standard ASNZS6400 2005 Water-efficient products - Rating and labelling which

bull defines the products

bull specifies the assessment procedures (ie identifies test procedures in other Australian Standards)

bull provides the formulas to give products their star rating

bull specifies the labels and their application to products

62

Approximately twenty organisations were represented on the Standards Committee that developed the Standard

State and Territory legislation

The States and Territories have also enacted or agreed to enact complementary legislation to ensure that the WELS Scheme has comprehensive national coverage State and Territory legislation which is almost a mirror of the Commonwealthrsquos Water Efficiency Labelling and Standards Act 2005 enables the States and Territories to for example undertake certain responsibilities delegated to them by the Commonwealth Regulator appoint their own inspectors and enforce the WELS

Other features of WELS include

bull A product web database

bull With the exception of toilets no other products are required to meet mandatory water efficiency requirements (WES) but this may change over time The introduction of mandatory WES means that products not meeting the minimum performance requirements can not legally be sold

bull Products must be tested in accordance with the relevant Standard and must meet any minimum performance and water efficiency requirements in the Standard before they can be granted a WELS Water Rating label

bull It is up to manufacturers or their agents (eg importers in the case of imported products) to ensure that their products are correctly registered and labelled and comply with any other requirements of the Standard

There is a transition phase which gives manufacturers and importers time to test register and label products and to sell pre-existing stock From 1 January 2008 all products are required to display the WELS Water Rating labels irrespective of their date of supply

63

The WELS Water Rating label

Label Features

bull A star rating for a quick comparative assessment of the models water efficiency

bull Labels with 1 to 6 stars

bull Some products may also be labelled with a Zero Star Rated label which indicates that the product is either not water efficient or does not meet basic performance requirements

bull A productrsquos water consumption figure

bull There are provisions for swing tags if there is inadequate surface area for label or the item is likely to be marked by sticking the label on the product

Summary Mandated product labelling using lsquostarrsquo rating system Has a disendorsement label and has provisions to ban products

33 Gas Appliance Rating Scheme

Purpose

A gas labelling program to improve the energy efficiency of gas powered products

Background and Strategy

The Gas and Fuel Corporation of Victoria introduced energy labelling for gas water heaters in 1981 This scheme was taken over by the AGA in 1985 who in 1988 introduced a six star energy performance label This label was intended to be visually consistent with the star rating labels already familiar to consumers of electrical appliances

The labelling scheme is currently voluntary and still administered by the industry body

A range of gas appliances have been subject to minimum energy performance standards (MEPS) since the 1960s The current MEPS levels were set in 1983 and

64

Brand Model Type MjyearStar

RatingSRI

StorageCapacity

(ltrs)IndoorOutdoor

NaturalGas

Instantaneous 18969 59 I N

Instantaneous 18969 59 I N

lsquothe majority of models currently on the market appear to exceed current requirements by a comfortable marginrsquo (SEAV 2003 p 23)

The gas energy labels are similar in format to those found on electrical appliances except they are blue and show annual energy use in MJ

A trial web site listing gas water heaters available in Australia is also available (see below)

Bottle Gas

Rinnai Infinity

V Series

REU-V2632FFU-A (Infinity 26 plus internal) P

Rinnai Infinity

V Series

REU-V2632FFUC-A (HD2001 internal) P

A joint review of the scheme is under way by the Gas Industry and Governments and regulation is under consideration A three year work plan has been published under the Australian and New Zealand Appliance and Equipment Energy Efficiency Program

Summary Currently voluntary labelling using lsquostarrsquo rating system with mandatory minimum energy performance standards Future regulation is under consideration

34 Green Vehicle Guide

Purpose

To provide web-based comparable and accessible environmental data on new motor vehicles

Background and strategy

65

The Commonwealth government started publishing a booklet of fuel consumption data for new passenger and light commercial vehicles in the early 1980s and a low cost web database in more recent years

In 2004 the Government through the Department of Transport and Regional Services (DOTARS) expanded the fuel consumption guide into the Green Vehicle Guide The Green Vehicle Guide is a web based database that rates new passenger and light commercial vehicles on air pollution greenhouse emissions and fuel consumption and gives an overall lsquostarrsquo rating for each vehicle within each vehicle category (small medium luxury sports etc)

The data on which the scores are derived are provided voluntarily by the vehicle manufacturers however this data is based on mandatory Australian Design Rule certification test data

The Guide uses a 5 star rating system however it also assigns half stars resulting in a total of 10 levels

The Greenhouse Ratings are based on carbon dioxide emissions and the Air Pollution Ratings take into account the relative environmental impact of oxides of nitrogen hydrocarbons and particles The relative harmfulness of the pollutants (shown in table below) has been quantified based on the allowable concentrations under the Ambient Air Quality National Environment Protection Measure (NEPM)

Green Vehicle Guide Weighting of Regulated Vehicle Emissions

Vehicle Emission

(equivalent pollutant under Air NEPM)

Calculated

Relative

Harmfulness

Final

Weighting

Carbon Monoxide (CO) 0088 Not included

Oxides of Nitrogen (NOx) (based on

Nitrogen Dioxide)

4 1

Hydrocarbons (HC) (based on

photochemical oxidants as ozone)

5 1

Particulate Matter (PM) (based on PM10) 20 5

Source Real and Jones 2005

NOx and HC were given equal final weightings despite the slight difference in the calculated relative harmfulness primarily because under ADR7900 a combined HC+NOx limit is prescribed rather than individual limits for each pollutant

The higher weighting for particulate matter recognises its significant health impacts The Air Pollution rating scale was devised in such a way that a lsquotypicalrsquo car (that is most petrol engined passenger cars meeting the current emission standard at the time) receives a mid-point rating (5 out of 10)

66

The overall rating or stars is derived from the sum of the air pollution and greenhouse scores ie they are equally weighted

Development of the Green Vehicle Guide (see extract below) involved extensive consultation with vehicle manufacturers

Website Costs

The new highly automated web database which contains data on approximately 1400 vehicles and has sophisticated search facilities cost approximately $200000 to develop plus around $100000 was spent recently to improve the sitersquos usability This compares to the previous low cost database which together with the printed guide cost less than about $80000 per annum The low cost version lacked the automation was only updated annually and did not have the ability to compared vehicles

The manufacturers provide the data on line using special access codes This data is checked by DOTARS before it is uploaded onto the website It takes close to a full time position within DOTARS to administer the website and respond to website related queries

Market Research and Marketing

Before the new greenvehicleguidegovau website was launched DOTARS commissioned consumer surveys to determine the level of knowledge about the environmental impacts made by vehicles This research showed that around half of those surveyed had the belief that ldquoall new cars have the same level of impact on the environmentrdquo

It became apparent through the surveys that there was a need to provide consumers with meaningful information on the relative performance of different vehicles This was a view shared by the Productivity Commission who said that while markets provide extensive information to consumers regarding fuel consumption of motor vehicles ldquothe Australian Governmentrsquos Fuel Consumption Labelling Scheme and Green Vehicle Guide provide relatively low cost accessible and comparable information to consumers and may be justified as part of the more fundamental objective of encouraging consumers to reduce the adverse environmental impacts of motor vehicle userdquo The Productivity Commission also commented that government

67

sources of information of this type were seen as credible and reliable and held in higher regard than information provided by others

DOTARS has scheduled some follow up consumer research for 200062007

DOTARS has spent about $600000 in marketing the Green Vehicle Guide This has included advertising in weekend guides in newspapers developing facts sheets plus targeted marketing to motor vehicle journalists

Summary Website - voluntary but legislative base

4 Government-Industry Partnership programs

Government-Industry Partnerships are the basis of many environmental initiatives and can take a number of forms Industry and government negotiate the terms of the program which are normally detailed in a formal agreement which sets out the environmental objectives and the responsibilities of each party towards their achievement

The GovernmentIndustry Partnership programs outlined below indicate the varied nature of these initiatives

41 The National Packaging Covenant

The National Packaging Covenant (the Covenant) commenced in 1999 and is a voluntary agreement between all levels of government and companies throughout the packaging chain including raw material suppliers packaging producers and retailers The Covenant commits signatories to the implementation of best practice environmental management in areas such as packaging design production and distribution and research into life cycle issues Signatories to the Covenant produce action plans on the measures they will implement to reduce packaging waste and they report annually on their progress In this sense the Covenant provides flexibility to signatories to develop plans suitable to their own circumstances The Covenantrsquos success (it currently has over 600 signatories) is due to the active promotion of it by Government and key industry players

The Covenant is complemented by a regulation the National Environment Protection (Used Packaging Materials) Measure (the NEPM) which enables states and territories to use enforcement action to require companies that donrsquot sign the agreement to take steps to reduce their packaging waste Preceding the Covenant and the NEPM were a number of voluntary industry agreements but these were limited in scope and largely focused on companies in the beverage industry

42 National Industry Reduction Agreement

The Publishers National Environment Bureau (PNEB) was formed in 1990 as an association of the major publishers of newspapers and magazines in Australia to promote the recovery and recycling of old newspapers and old magazines primarily from community kerbside collections organised by local councils

68

The PNEB and a newsprint manufacturer have voluntarily entered into a series of five-year Industry Waste Reduction Agreements with the Commonwealth and State Governments Under the current (third) plan 2001-2005 newsprint recycling in Australia has grown to 754 nationally in 2005 from the 28 level when the PNEB was formed in 1990

43 StateLocal target based programs

There have been a number of agreements signed by state government departments and an industry group where there is a stated goal to reach a specific environmental target For example in the early 1990s there was a voluntary agreement with the EPA Victoria and companies in the Altona Chemical Complex in the western suburbs of Melbourne (which includes Australian Vinyls BASF Dow Chemicals and Qenos) to reduce hydrocarbon emissions by 50 within a specified timeframe The target was met and further emissions reductions were negotiated The NSW EPA-Oil industry petrol volatility agreement outlined below is another example of a target based program

44 NSW EPA-Oil Industry Memorandum of Understanding on Summer Petrol Volatility

In 1998 NSW established arrangements for the supply of low volatility petrol in summer in the Sydney Greater Metropolitan Region implemented through a Memorandum of Understanding between the then EPA and oil companies The principal reason for controlling petrol volatility in summer is to reduce evaporative emissions of VOCs (from vehicles and production and storage sites) which contribute to ozone formation

The Memorandum of Understanding operated over four summer periods from 1998 to 2002 and involved companies voluntarily reducing petrol volatility (measured in kilopascals (kPa) of vapour pressure) over three summer periods from a base of 76kPa to 70kPa in the first summer 67kPa in the second and 62 kPa in the last two years

Although the Memorandum of Understanding was successful in progressively reducing petrol volatility over the period of its operation it was not supported by all industry members Consequently agreement was reached with industry that summer petrol volatility limits should be regulated to ensure a level playing field for all industry participants and regulated limits will apply from the summer of 200405

69

5 Summary of Australian Benchmark Programs

Program National State

Summary of Approach Impact

Voluntary Programs Altona Chemical Complex (Vic)

Local Small industry group worked towards self determined targets

Very high

Energy Star National Standards based label Limited Gas appliance Rating Scheme

National Industry operated labelling scheme with stars assigned therefore has graded benchmarksminimum performance standards out dated web database being developed

Low

National Industry Reduction Agreement

National Small industry group worked towards negotiated targets

High

NSW EPA-Oil Industry MOU

State Small industry group worked towards negotiated targets but not all involved ndash lead to regulations

Moderate

Top Energy Saver Award

National Achievement based label Limited

Quasi Regulatory Green Vehicle Guide

National Well promoted web database star ratings assigned therefore has graded benchmarks data provided voluntarily but backed by ADR requirements

High

Stand-by power National Required to achieve voluntary targets or regulation will be introduced

Unknown

National Packaging Covent

National Performance based targets backed by legislation High

Regulatory Energy Efficiency Labels

National Labelling scheme with stars assigned therefore has graded benchmarksbased on Australian Standard web database

High

MEPS National Sets base benchmark and works with energy rating

High

WELS Scheme National Labelling scheme with stars assigned therefore has graded benchmarksbased on Australian Standardweb database

High

Wood heaters State Only one benchmark assigned regulations are not uniform

Moderate

authorrsquos assessment based on direct or indirect knowledge of these programs

70

Appendix 3 Productivity Commission Comments on Labelling and Minimum Performance Standards

The Productivity Commission an independent agency which is the Australian Governmentrsquos principal review and advisory body on microeconomic policy and regulation recently examined the cost effectiveness of improving energy efficiency As part of its review lsquoThe Private Cost Effectiveness of Improving Energy Efficiencyrsquo it examined labelling programs minimum mandatory energy efficiency requirements and other means of providing consumer information The final report contains some highly relevant material that is applicable to establishing a benchmarking scheme for small engines

The following is a summary of relevant conclusions from the Inquiry

Government Operated Labelling Schemes

From consumer research provided to the Commission it concluded that ldquothere is some evidence to suggest that consumers are now paying more attention to labels than they have in the pastrdquo

The Commission was positive about labelling programs as labels

bull directly address ldquoa source of market failure mdash the asymmetry of information between buyers and sellers of energy-using productsrdquo

bull provide information to the consumer that is readily-accessible and easily-understood and therefore can assist in helping the consumer make better-informed choices

bull are likely to have produced net benefits for consumers

bull do not directly limit consumer choice

bull could provide a greater incentive for suppliers to sell products that use energy cost effectively

bull probably produced net social benefits

bull are most suited where there is a wide spread in the range of performances of comparable appliances and where information failures are most pronouncedrdquo

bull can be used to warn consumers that an appliance is very inefficient (through a disendorsement label) which could be effective in discouraging but not preventing consumers from buying the poor performing product

The Commission was supportive of Governmentrsquos role of drawing together and packaging information through labelling programs as this ensures that ldquorelevant and trusted information gets to those who would otherwise not get itrdquo In material reviewed by the Commission George Wilkenfeld and Associates and Energy Efficient Strategies (1999) claimed that labelling is unlikely to be effective if purchasers rarely inspect appliances in a showroom where they can compare performance across

71

different models or the purchaser is not the ultimate user and so has little interest in operating costs

Labelling programs involves both administration and compliance costs such as those incurred by suppliers in having their products tested but the Commission considered that labels should be more actively considered as an alternative to minimum performance standards

Minimum Performance Standards

Governments can prevent the sale of inefficient products by using minimum standards for example the Minimum Energy Performance Standards (MEPS) that apply to appliances such as refrigerators and freezers air conditioners and electric water heaters If appliances do not meet the minimum standard they cannot be sold in Australia Some appliances are covered by both MEPS and by labelling (for example refrigerators)

The Commission considered that MEPS and labels can be complementary as MEPS act to penalise the worst energy performers whereas labels rewarding the better performers

Costs comparisons of schemes

The Department of the Environment and Water Resources provided details about the costs involved in administering both the labelling scheme and the minimum performance standards for energy programs It stated that

bull the administration costs of MEPS are substantially lower than for labelling but the compliance costs can be higher

bull MEPS can have a greater cost for suppliers than labelling since suppliers must adjust their model ranges to meet the MEPS levels by the given date These compliance costs are however influenced by the lsquolead inrsquo time between the introduction of the regulatory proposal and the implementation of the MEPS

bull it is estimated that the administration costs for MEPS would be $3 million over the period 2000ndash15 compared to $39 million for labelling (in present value terms) (George Wilkenfeld and Associates and Energy Efficient Strategies 1999) Furthermore it was assumed that 84 per cent of administration costs were borne by appliance purchasers with the remainder borne by governments

It estimated that MEPS would increase the cost of appliances by $266 million over 2000ndash15 compared to $688 million for labelling (the latter cost being due to consumers voluntarily purchasing more efficient appliances)

72

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