Zero-Emission Cargo Handling Equipment Pilot Project 

About the Program 

The Zero-Emission Cargo Handling Equipment Pilot Project (ZE CHE Pilot) is a collaboration between The California Air Resources Board (CARB), the San Diego Unified Port District (POSD), the Portside Steering Committee, and the San Diego County Air Pollution Control District (SDAPCD) to transition diesel powered cargo handling equipment to zero-emission alternatives to improve air quality in the Portside Environmental Justice Community.  Approved by CARB in October 2026, the ZE CHE Pilot Project Plan includes information on objectives, eligibility, funding, and more which are summarized below.  Participants are reimbursed through the AB 617 Community Air Protection Program, which is funded by California Climate Investments (CCI).  CCI uses billions of Cap-and-Invest dollars to fund projects that reduce harmful emissions, protect public health, strengthen local economies, and support natural environments. With a strong focus on communities most impacted by pollution and limited access to resources, California Climate Investments helps build a more equitable and sustainable future. 

Eligibility and Requirements 

ZE CHE Pilot incentive funding may be awarded to tenants or service providers of the Port of San Diego (Port) that own diesel-powered cargo-handling equipment operating at or in support of Port marine cargo terminals within the AB 617 Portside Community boundaries.  Any equipment with a cargo handling function will be considered for funding.  Awardees must commit to operating equipment for a minimum of three years.  Additional requirements include, but are not limited to the following: 

• Applicants must provide documentation of existing equipment, including engine specifications and usage. 

• Scrappage is not required; however, higher funding percentages will be awarded to participants who agree to scrap existing equipment.  More information on funding is included below. 

• Access to charging/fueling must be confirmed. 

• Applicants must certify compliance with all air quality regulations. 

• Awardees must make equipment available for inspections by SDAPCD staff. 

• Awardees must participate in one zero-emission outreach event per year for the duration of the contract. 

A full list of requirements is available in the Project Plan. 

Funding

The maximum percentage of eligible costs covered by funding from the CHE Pilot will depend on the disposition of the existing equipment that is to be replaced: 

If the ZE CHE Pilot is oversubscribed, SDAPCD may impose funding caps on equipment that reduce grant amounts below the percentages listed above so that a higher number of projects can receive funding.  Additional funding may be awarded for electric charging infrastructure on a case-by-case basis, which will be capped at $30,000 per charger installed. 

*Fleet expansion projects will be considered when the applicant intends to purchase new cargo handling equipment and will commit to new zero-emission equipment instead of new diesel-powered equipment.  Funding amount, emission reductions, and cost-effectiveness will all be calculated based on the gap between purchasing the cleanest available new diesel equipment versus new ZE equipment. 

Application 

The application form for the ZE CHE Pilot is available to download here.  Applications will be accepted starting Thursday, November 12, 2026, until 5 pm on Tuesday, January 19, 2027.  For any questions or support with your application, please contact us at CleanAirGrants@sdapcd.org.  SDAPCD staff will contact all applicants to request additional information and provide updates as needed. Applications will be ranked by emission reductions achieved through the project, cost effectiveness, and contribution to the goals of the Portside Community Emission Reduction Plan.