Unocal Corp. is recycling its cash-for-clunkers program into a subsidiary company.
The big Los Angeles oil company has formed Eco-Scrap Inc., which will buy privately owned, 1981 and older cars and take them off the road. Unocal will pay up to $600 each for the vehicles.
It makes the company a player in the South Coast Air Quality Management District’s program designed to lower pollution-control costs for businesses. AQMD rules require companies with 100 or more employees to implement ride-sharing programs, thus cutting vehicle traffic during the work week. It’s expensive, averaging $110 per employee.
But businesses can also use old-vehicle scrapping programs to meet their AQMD goals at a savings of up to 67 percent of the ride-sharing program’s cost.
Enter Unocal. Its Eco-Scrap unit will charge businesses a fee to find old cars, process the paperwork and have the emission credits issued in the company’s name, said Ronald J. Mertz, the unit’s president.
“We won’t make a bunch of money but it will be profitable, we hope,” said Mertz. “Of course we don’t expect the client to produce the money up front. We’ll use our financial strength to do that because we know we can deliver the credits. We’ll have a substantial (financial) outlay at any given time and we’re willing to take that risk.”
Unocal pioneered the auto scrapping concept in 1990 as a way to reduce pollution caused by older vehicles that were not equipped with government mandated emission control equipment. The company has acquired 10,200 vehicles during its intermittent buyback programs, paying consumers more than $7 million.
Now, Unocal expects to buy 10,000 cars a year, Mertz said.
These older cars produce 50 to 100 times more pollution-forming compounds per mile than new vehicles.
AQMD officials liked the idea and included it in the smog-fighting plan in 1993.
Since then auto scrapping has helped reduce pollution by eliminating from the air 800 tons of hydrocarbons, 200 tons of nitrogen oxide and 4,700 tons of carbon monoxide, said Dave Coel, AQMD’s program supervisor for on-road mobile sources.
“We think they have been successful,” he said of scrapping programs. “We’re happy to see someone who has experience in vehicle scrapping getting in the business.”
The environmental group Coalition for Clean Air thinks taking old cars off the road is a good idea but does not consider it a panacea for the region’s pollution problem.
“Scrapping is a short-term solution,” said Linda Waade, the coalition’s executive director who says older cars are the main mode of transportation of the elderly and lowincome drivers. These people may sell their car for scrap then buy a similar vehicle, she said.
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