February 24, 2026
Economic Development
PORT
DATE: February 24, 2026
TO: Mayor Martinez and Members of the City Council
FROM:
Charles Gerard, Port Director
Subject:
Agreement with STAX Engineering for Deployment of a
CARB-Approved Emissions Control Solution Barge
FINANCIAL IMPACT: There is no impact to the City’s General Fund.
The proposed agreement authorizes up to $750,000
annually, and up to $2,250,000 over three years starting in fiscal year 2026-2027, representing the maximum
potential exposure of the Port of Richmond Enterprise
Fund (Account String: 40162380-400532).
The Port’s commitment is limited to filling a service gap in the approximately 1,260 annual CAECS hours required
by STAX Engineering after shipping line commitments,
and actual costs are expected to decline as additional
vessels utilize the service and as expanded CARB At-
Berth Regulation requirements take effect in 2027. Costs are anticipated to be recovered over time through the
Environmental Services Fee Tariff.
PREVIOUS COUNCIL
ACTION:
October 1, 2024
November 19, 2024
August 26, 2025
AGENDA
REPORT
February 24, 2026
STATEMENT OF THE
ISSUE:
The California Air Resources Board (CARB) At‑ Berth
Regulation for Automotive Roll‑ On/Roll‑ Off (RoRo)
vessels became effective on January 1, 2025, requiring
covered vessels to reduce emissions from auxiliary
engines while docked at California ports. The Port of
Richmond has remained compliant with the regulation
through a CARB‑ approved prospective remediation
process while continuing to pursue a deployable
long‑ term compliance solution.
Due to operational constraints, limited RoRo vessel calls, and the absence of shore‑ power‑ ready vessels,
deployment of shore power is not currently feasible at the Port. Authorization of an agreement with STAX
Engineering enables deployment of a CARB‑ approved
emissions control barge that captures and controls vessel exhaust while docked, providing a practical near‑ term
compliance solution.
RECOMMENDED ACTION: ADOPT a resolution appropriating $750,000 annually for three fiscal years (Fiscal Year (FY) 2026–2027, FY
2027–2028, and FY 2028–2029), for a total appropriation of $2,250,000; APPROVE and AUTHORIZE the city
manager or their designee to negotiate and execute an
agreement with STAX Engineering, pursuant to a
previously issued Request for Proposals, for the
deployment and operation of a California Air Resources
Board (CARB)-Approved Emissions Control Solution
(CAECS) barge at the Port of Richmond, for an annual
amount not-to-exceed $750,000, and a total contract
amount not-to-exceed $2,250,000, for a three-year term
ending March 31, 2029 – Economic Development
Department/Port (Charles Gerard 510-620-6792).
DISCUSSION:
California Air Resources Board (CARB) At‑ Berth Regulation The CARB At‑ Berth Regulation is intended to reduce emissions of diesel particulate matter, nitrogen oxides, and greenhouse gases from vessels while docked at California ports, thereby improving local and regional air quality. Compliance for Automotive Roll‑ On/Roll‑ Off (RoRo) vessels became mandatory on January 1, 2025. Compliance may be achieved either through connection to shore power infrastructure or through use of a CARB‑ Approved Emissions Control Solution.
February 24, 2026
Port of Richmond Compliance History
The Port of Richmond is a smaller port with approximately 60 RoRo vessel calls per year, compared to larger California ports that may experience more than 200 calls annually. This lower volume presents unique financial and operational challenges for deployment of emissions control solutions.
The Port has remained compliant with the At‑ Berth Regulation through a CARB‑ approved prospective remediation process. Under this process, shipping lines pay a fee to CARB for each hour a vessel is docked at the Port, and those funds are used by CARB and the local air district to support regional clean‑ air initiatives.
Procurement History
The Port issued a competitive Request for Proposals (RFP) seeking a CARB‑ Approved Emissions Control System (CAECS) to support long‑ term compliance. Two proposals were received, from STAX Engineering and G4. City staff evaluated and scored the proposals in accordance with the RFP criteria and determined that STAX Engineering was the highest‑ ranked proposer and the only proposer offering a CARB‑ approved solution.
Following City Council authorization on October 1, 2024, and approval of an agreement on November 19 2024, execution of the agreement was deferred after one of the shipping lines calling the Port discontinued service, reducing anticipated vessel calls and increasing the cost burden per service hour. City staff continued negotiations with shipping lines, terminal operators, and STAX Engineering under the same RFP procurement framework while evaluating alternative cost‑ recovery structures.
Current Proposed Solution
STAX Engineering is a CARB‑ approved provider of emissions control services utilizing a barge‑ mounted exhaust capture and treatment system. STAX Engineering requires a minimum annual commitment of approximately 1,260 service hours at a rate of $2,850 per hour to finance construction and deployment of a CAECS barge to Richmond.
Major ocean shipping companies calling at the Port have committed approximately 900 annual service hours, including 700 hours from Nippon Yusen Kaisha (NYK) and 200 hours from Mitsui O.S.K. Lines (MOL). To address the remaining service gap, the Port proposes to contract for up to 260 additional service hours per year, billed only when third-party commitments are insufficient.
Assuming deployment of the CAECS barge in late 2026 following a six‑ month construction and delivery schedule, the Port’s estimated maximum financial exposure in Calendar Year 2026 is approximately $185,250, depending on actual vessel usage.
Beginning January 1, 2027, additional vessel categories, including liquid bulk vessels, will be subject to the At‑ Berth Regulation, and private terminal demand for CAECS services is expected to reduce or eliminate the need for Port‑ funded service hours.
February 24, 2026
Cost Recovery and Long-Term Outlook
To recover costs associated with compliance with the California Air Resources Board (CARB) At-Berth Regulation and to support ongoing environmental initiatives at the Port of Richmond, City staff proposes adoption of an Environmental Services Fee Tariff. The tariff is intended to equitably distribute regulatory compliance costs across vessels calling Port of Richmond berths that are subject to the At-Berth Regulation.
The Environmental Services Fee Tariff would apply to vessels calling Port of Richmond berths that are subject to the CARB At-Berth Regulation and would be assessed as an hourly charge while a vessel is docked at berth, at a proposed rate of $200 per vessel hour. At a minimum, the tariff is expected to generate approximately $200,000 annually, with the potential for higher revenue depending on vessel activity. The effective date of the tariff will be established by the Port following required review by the California Association of Port Authorities (CAPA) and filing with the Federal Maritime Commission (FMC).
Revenues generated by the Environmental Services Fee Tariff will be deposited into the Port of Richmond Enterprise Fund and may be used to offset CAECS service costs, support future CARB compliance requirements, and fund Port-related environmental projects. Such projects may include, but are not limited to, renewable energy installations, stormwater and drainage improvements, environmental monitoring and abatement activities, and environmentally related dredging and maintenance.
Beginning January 1, 2027, additional vessel categories, including liquid bulk vessels, will be required to comply with the CARB At-Berth Regulation. Private liquid bulk terminals in Richmond are expected to procure CAECS services directly, which is anticipated to reduce or eliminate the need for Port-funded service hours. As a result, staff anticipates that tariff revenues, combined with increased third-party utilization of CAECS services, will offset initial compliance costs and generate a net-positive financial outcome over time, allowing the Port to reinvest in additional environmental and sustainability initiatives.
Project Cash Flow (Illustrative)
Notes and Assumptions:
The estimated 2026 Port cost reflects partial-year operation following anticipated mid-year deployment of the CAECS barge.
The 2026 estimate assumes approximately 65 hours (one quarter of the Port’s maximum annual commitment of 260 hours) at a CAECS service rate of $2,850 per hour, resulting in an estimated maximum cost of $185,250. Tariff revenue estimates are based on an Environmental Services Fee Tariff of $200 per vessel hour assessed while vessels are docked at berth. Beginning January 1, 2027, expanded CARB At-Berth Regulation requirements applicable to additional vessel categories, including liquid bulk vessels, are expected to increase private-terminal demand for CAECS services, thereby reducing or eliminating the Port’s required service hours and resulting in net-positive financial outcomes over time.
February 24, 2026
Actual costs and revenues will vary based on vessel calls and utilization of CAECS service hours by third parties.
Calendar Year Estimated CAECS
Cost (Port)
Estimated Tariff
Revenues
Net Impact to Port
2026 Up to $185,250 ~$100,000 ($85,250)
2027 Minimal to $0 ~$200,000+ Positive
2028 $0 ~$200,000+ Positive
DOCUMENTS ATTACHED:
Attachment 1 – Proposed Resolution