Meeting Date: July 13, 2005

Subject: Procurement Authorization - Revision To Engine Exhaust Aftertreatment - Orion VII Buses

Recommendation

It is recommended that the Commission authorize Contract Amendment C32PY04839 #2 in the credit amount of $445,004, to Orion Bus Industries Inc. to allow the first 80 buses of the 330 bus order to be delivered with Diesel Oxidizing Catalyst exhaust aftertreatment instead of the Diesel Particulate Filters originally specified.

Funding

Approval of the recommendation will allow the Commission to realize a reduction in the cost of the bus procurement project in the amount of $417,917 (excluding GST content).  This amount will be reflected in a credit against the Purchase of Buses Program 4.11 in the TTC 2005-2009 Capital Program as approved by City Council on February 23, 2005. 

Background

In early 2005, a contract for the supply of 330 buses, made up of 150 diesel-hybrid and 180 clean diesel buses, was awarded to Orion Bus Industries in Mississauga, Ontario.  In an effort to provide the City with the best available technology for the control of engine exhaust emissions, the Commission’s specifications required that all buses be fitted with Diesel Particulate Filters (DPF’s) as part of the exhaust system.  These filters are intended to trap and burn combustible particulate matter and unburned hydrocarbon contained in diesel exhaust after the combustion process.  The use of these systems is relatively “leading edge” in fleet operation, and field experience is limited.  Some transit properties, including OC Transpo in Ottawa and Golden Gate in California, are reporting problems with plugging of the filters, and other engine problems, resulting in significant down time while the filters are serviced.

It is a requirement of the DPF’s that Ultra Low Sulphur Diesel (ULSD) fuel be used exclusively to ensure that the internal coating on the catalyst portion of the substrate is not poisoned by sulphur contained in the fuel currently being used.  Although ULSD is available in some areas of Canada, and the United States, it is not mandatory until September, 2006. TTC’s current supplier will not commit to providing this new product until the mandatory deadline.

The bus delivery schedule in the contract with Orion required delivery of the diesel buses after the September, 2006 deadline for ULSD availability.  More recently, because of unexpected failures of older General Motors and New Flyer buses in the fleet, it was necessary to approach Orion on the possibility of early delivery of some buses in the order to address the unplanned withdrawal of these buses from the fleet.  Orion responded with a proposal to deliver the 80 diesel buses in the period of February to April, 2006, rather than during November and December as specified in our contract.

Since the required ULSD fuel will not be available until September, the DPF’s will have to be replaced by the more commonly used Diesel Oxidizing Catalyst (DOC’s) aftertreatment that is compatible with the diesel fuel currently available.  As the DOC’s are much less expensive than the DPF’s, a credit in the amount of $445,004 would be realized by the Commission.

Contract details are as follows:

Contract C32PY04839

Original Contract Amount / $208,086,892.35

Previously Approved Amendments / 1,815,735.00

Amendment # 2 /(445,004.00)

Revised Contract Amount / $209,457,623.35

Work on this proposed amendment has not yet begun.

Discussion

In view of the foregoing issues mentioned in regard to the need to receive buses earlier than originally planned, and the incompatibility of the specified DPF exhaust aftertreatment with the fuel currently available, and in consideration of the high maintenance and engine problems related to the use of DPF aftertreatment technology, it is recommended that approval be given to revert to the more common practice of using Diesel Oxidizing Catalyst exhaust aftertreatment until the performance problems are resolved by industry and Ultra Low Sulphur Fuel is available.

Justification

Based on the experience of other transit properties such as Ottawa and Golden Gate in California, it has become evident that the introduction of Diesel Particulate Filters to large fleets is premature and is leading to high filter maintenance and reduced availability of buses for service.  Additionally, because DPF’s can be damaged by the use of currently available diesel fuel, this aftertreatment cannot be introduced to a fleet until the supply of Ultra Low Sulphur fuel becomes mandatory in September, 2006.  It is recommended that the Commission approve the use of DOC’s until the DPF technology is proven, and ULSD becomes available.

June 24, 2005

5-92-91