06/27/2024

Breaking Down The Indirect Source Rule (ISR) and the Warehouse Actions and Investments to Reduce Emissions (WAIRE) program

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Guest Blog Post: Alexa Branco, Director of Sustainability at NFI

The state of California continues to evolve its environmental regulations, some of which have a direct impact on shippers and carriers. The South Coast Air Quality Management District (SCAQMD) implemented the Indirect Source Rule (ISR) and Warehouse Actions and Investments to Reduce Emissions (WAIRE) program.

What is the Indirect Source Rule (ISR)?

The Indirect Source Rule (ISR) affects warehouse operators in the SCAQMD. This rule was developed to require large warehouses to reduce air pollution from mobile sources such as trucks delivering goods to and from the facilities.

The outcome is that facilities greater than 100,000 square feet are required to pay an emission mitigation fee of approximately $1 per square foot annually based on their truck visits and the type of truck delivering to their facility.

The SCAQMDs jurisdiction covers Southern California, specifically large areas of Los Angeles, Orange, Riverside, and San Bernardino Counties.

What is the Warehouse Actions and Investments to Reduce Emissions (WAIRE) Program?

Through the Warehouse Actions and Investments to Reduce Emissions (WAIRE) Program, the WAIRE menu allows operators to earn points for using Zero-Emission Vehicles (ZEV) and sustainable warehouse infrastructure. Applying these tactics allows companies to earn WAIRE points to offset emission mitigation fees, also called Waire Point Compliance Obligation (WPCO). 

How to earn WAIRE points

At NFI, we take a consultative approach, calculating our customers’ Weighted Annual Truck Trip (WATT) to determine their WPCO score and then recommending unique solutions. From NFI’s experience, the best ways to earn points include:

  • Use an EV yard tractor- Purchasing just one EV yard tractor gives you upfront points with additional points available once it’s in use.
  • Partner with clean fleets that can offer ZEV for class 2b-8 trips. 
  • Install solar on the warehouse to power the building with renewable energy.
  • Install and use electric vehicle chargers at the warehouse. The installation gets the most points, but the usage gives you promised points for the future. This is for both commercial and noncommercial vehicles.

NFI has developed internal expertise by being an early adopter of various zero-emission technologies and partnering with one of North America’s largest clean transportation consultants. From running battery-electric yard tractors at our California operations since 2019 to installing commercial and noncommercial charging infrastructure and solar on our warehouses, NFI has fully mitigated the expense from the Indirect Source Rule with the amount of WAIRE points produced and is ready to help our customers.

NFI operates over 15 million square feet in the SCAQMD. In 2022, NFI was the second-largest producer of WAIRE credits. In both 2022 and 2023, we produced more than enough credits to cover the sites we operate for our customers. Since then, we’ve opened our charging facility with 100 ZEVs to operate in Southern California by the end of 2024. These updates allow us to serve more customers in the SCAQMD area and help alleviate the WPCO fees. With the fleet, distribution, and reporting experience, we look forward to helping more customers offset fees and contribute to a more sustainable future.

For more information, visit NFI’s sustainability page

Alexa Branco, Director of Sustainability

Alexa Branco is the Director of Sustainability at NFI, where she focuses on implementing sustainable supply chain solutions for NFI and our customers. Prior to her role in sustainability, Alexa was a Senior Operations Support Manager on NFI’s transportation team and has spent much of her career working in the transportation industry.