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Boat Builder Regulatory Update ABYC Standards Week H 24 Fuel Standard John Mc. Knight Boat Builder Regulatory Update ABYC Standards Week H 24 Fuel Standard John Mc. Knight

Marine Regulations • California Evaporative Emission Update • Canada Marine Engine and Evaporative Emission Marine Regulations • California Evaporative Emission Update • Canada Marine Engine and Evaporative Emission Update • EU Update For more information, or a copy of today’s presentation, please visit www. nmma. org/government/issues/environmental. aspx

How will the US fuel supply affect the boats you build? • What do How will the US fuel supply affect the boats you build? • What do we now know about ethanol in fuel at amounts >10%? • What do we know about alternatives to ethanol enhanced fuels? • What are the US and California Governments doing about this?

Results Summary • Verado – Initial E 15 engine generated HC+NOx emissions in excess Results Summary • Verado – Initial E 15 engine generated HC+NOx emissions in excess of FEL when operated on E 15 fuel. – E 15 engine failed exhaust valves. Metlab analysis showed excessive metal temperatures caused a reduction in fatigue strength. • F 9. 9 HP – The E 15 engine on E 15 fuel showed high HC variability at the post-endurance emissions testing. It is believed that this engine was misfiring at idle due to the lean operation. – The E 15 engine showed evidence of hotter metal temperatures due to carbon deposits, etc. – The E 15 engine showed signs of gasket deterioration on the fuel pump. • 200 HP EFI 2. 5 L 2 Stroke – E 15 engine showed no difference in emission deterioration. – E 15 engine failed the rod bearing. Root cause is indeterminate due to the degree of damage. • How does ethanol affect oil dispersion in two stroke engines? – Other than the bearing failure, the end of test teardown and inspection did not show any significant difference between the 2 engines

Results Summary-Continued • 4. 3 L V 6 ECT Mercruiser – Two emissions tests Results Summary-Continued • 4. 3 L V 6 ECT Mercruiser – Two emissions tests were performed on a 4. 3 L catalyzed sterndrive engine to compare the E 0 fuel and the E 15 fuel. No durability testing was completed on the 4. 3 L engine with E 15 fuel. – This testing was not part of the contract, but was performed due to the fact that the E 15 test fuel and a catalyzed engine were readily available on the dyno. Also, it compliments the testing on a 4. 3 L carbureted engine done by Volvo Penta. – EGT increased ~20 C and catalyst temperatures increased ~32 C at Mode 1 (WOT). • Valvetrain durability and catalyst system deterioration concerns. – Fuel consumption increased by ~5% (mass-based fuel flow) in closed loop operation. – Aside from HC and CO reductions at Mode 1 (open loop), the E 15 fuel afforded no real benefit to reduced emissions overall. • • • NOx increased at Mode 1, but not as much as HC decreased for a slight overall reduction. HC, NOx and CO in closed loop operation are essentially unchanged between the 2 fuels. Overall – The CO emissions were lower on all engines with E 15 fuel due to leaner running (as would be expected). – Fuel analysis showed the E 15 fuel that was used in testing was in line with expectations.

F 9. 9 HP 4 -Stroke Teardown and Inspection More carbon deposits on intake F 9. 9 HP 4 -Stroke Teardown and Inspection More carbon deposits on intake valves of E 15 engine.

F 9. 9 HP 4 -Stroke Teardown and Inspection • More carbon deposits on F 9. 9 HP 4 -Stroke Teardown and Inspection • More carbon deposits on intake port of E 15 engine. E 0 E 15

F 9. 9 HP 4 -Stroke Teardown and Inspection • More carbon deposits on F 9. 9 HP 4 -Stroke Teardown and Inspection • More carbon deposits on piston undercrown and rods of E 15 engine.

Verado E 15 Valve Failure Investigation Cylinder 6 Top Valve Cylinder 3 Bottom Valve Verado E 15 Valve Failure Investigation Cylinder 6 Top Valve Cylinder 3 Bottom Valve

Verado E 15 Valve Failure Investigation Cylinder 3 Bottom Valve Verado E 15 Valve Failure Investigation Cylinder 3 Bottom Valve

200 HP EFI E 15 Engine-Bearing Failure • • • Root cause of bearing 200 HP EFI E 15 Engine-Bearing Failure • • • Root cause of bearing failure is unknown. 283 total engine hours, 256 WOT endurance hours No rollers were recovered. Remaining Pieces from Cyl 3 Rod Bearing Cage Undamaged Bearing Undamaged Rod from Cyl 3

Conclusions and Recommendations Summary • Despite the limited scope of project several significant issues Conclusions and Recommendations Summary • Despite the limited scope of project several significant issues were discovered. – Durability Failures – Emissions Issues (elevated NOx, HC variability) – Run Quality due to Lean Operation • More testing is necessary to understand effects on: – Drivability- Ex. cold and hot start, transient accel/decel, “boil off”, etc. – Oil dispersion in 2 stroke engines – Storage (phase separation, corrosion, etc. ) • Test program was a cursory look at the effects of E 15. – Sample size was insufficient to have statistical significance. – WOT operation only-masks effects of true customer duty cycle

So we had to put some the great minds in the boating industry to So we had to put some the great minds in the boating industry to think about this

And at the end of the day we decided to test this new type And at the end of the day we decided to test this new type of biofuel called isobutanol

What is Butanol? • A four carbon alcohol (C 4 H 9 OH), colorless, What is Butanol? • A four carbon alcohol (C 4 H 9 OH), colorless, neutral liquid of medium volatility with a characteristic banana-like odor. • Can be biologically derived from biomass in a fermentation process using microorganisms – Biobutanol • Biobutanol fermentation differs from bioethanol mainly in the use of bacteria. • An existing ethanol plant can be converted to make butanol

Butanol Properties: • Butanol 99, 800 BTU/gallon • Gasoline 116, 000 BTU/gallon • Approximately Butanol Properties: • Butanol 99, 800 BTU/gallon • Gasoline 116, 000 BTU/gallon • Approximately 86% of the energy content of gasoline • Ethanol 76, 300 BTU/gallon (68% of the energy content of gasoline)

Butanol Properties: • Phase Separation • As water enters a boat fuel system containing Butanol Properties: • Phase Separation • As water enters a boat fuel system containing ethanol-extended fuels, phase separation may occur creating an ethanol/water fuel mixture. • Butanol does not phaseseparate as shown in the cylinder on the right Figure 1. Effect of adding 10% water by volume to 85% ethanol and 10% water by volume to 85% butanol

Butanol Introduction: • Less susceptible to phase separation means butanol could be successfully delivered Butanol Introduction: • Less susceptible to phase separation means butanol could be successfully delivered in existing pipelines • Eliminates need for splash-blending • Least corrosive of alcohols • Higher energy content – can be blended into gasoline at higher percentages than ethanol

Energy Content: • 16. 1% butanol by volume is equivalent to 10% ethanol by Energy Content: • 16. 1% butanol by volume is equivalent to 10% ethanol by volume • ~3% O 2 Gasoline

Purpose of Testing: • To evaluate the effect of butanol-extended fuels in a harsh Purpose of Testing: • To evaluate the effect of butanol-extended fuels in a harsh marine environment and to see if there is a better alternative to ethanol-extended fuels

Test Set-up: • On-water emissions testing using the Marine Portable Bag Sampling (MPSS) unit Test Set-up: • On-water emissions testing using the Marine Portable Bag Sampling (MPSS) unit developed for the EPA/NMMA green house gas study.

The Capture The Capture

The Boats & Crew The Boats & Crew

The Boats & Crew The Boats & Crew

Tests Conducted: • On-water emissions testing • Emissions data reported using EPA certification fuel Tests Conducted: • On-water emissions testing • Emissions data reported using EPA certification fuel (non-oxygenated) and 16. 1% isobutanol-extended fuel. • Values reported in grams per ICOMIA hour: – Total Hydrocarbons – Nitrogen Oxides – Carbon Monoxide

Test Results: HC + NOx emissions are virtually the same between the two fuels. Test Results: HC + NOx emissions are virtually the same between the two fuels. CO is reduced using isobutanol (as expected) Evinrude E-TEC 175 Stratified Charged Direct Fuel Injection Two-Stroke on water emissions evaluation [HC, NOx, CO] – 18' Mako Boat. Comparison between Indolene fuel and 16. 1% isobutanol extended fuel. Values in grams per ICOMIA hour average of two tests per fuel type

Test Results: HC decreased slightly and NOx increased slightly using isobutanol…but the total HC+NOx Test Results: HC decreased slightly and NOx increased slightly using isobutanol…but the total HC+NOx was virtually the same between the two fuels. CO is reduced using isobutanol (as expected) Jet-boat on water emissions evaluation [HC, NOx, CO] – Rotax 1503 Supercharged Four-stroke engine. Comparison between Indolene fuel and 16. 1% isobutanol extended fuel. Values in grams per ICOMIA hour average of two tests per test fuel.

Product Testing Product Testing

Vintage Tank Testing…. . Vintage Tank Testing…. .

Coupon testing Coupon testing

E 10/E 15 as Certification Fuel? • EPA is expecting to propose a new E 10/E 15 as Certification Fuel? • EPA is expecting to propose a new certification fuel for cars and light-trucks at the end of 2011 – Likely to propose a 15% ethanol/gasoline (E 15) blend – EPA recently approved a waiver for E 15 and expects use to grow significantly in coming years • EPA is considering proposing the new certification fuel for all nonroad categories that use gasoline – Apply to Marine SI, Small SI, Large SI, and Rec Vehicles – Apply to both exhaust and evaporative emissions 31

E 10/E 15 as Certification Fuel? • For marine engines, EPA has explored three E 10/E 15 as Certification Fuel? • For marine engines, EPA has explored three options – E 15 – E 10 initially, then move to E 15 after market review indicates E 15 is a “significant” fraction of fuel sold – E 10 • EPA would allow multiple years for manufacturers to re-certify their products on the new fuel – Open to allowing carryover of existing CE 10/E 10 data from fuel tank and fuel line permeation testing • • No decisions have been made yet Proposal will be available on EPA website after signature – http: //www. epa. gov/otaq/hwy. htm 32

The Ongoing Debate “Recent claims from some marine engine manufacturers that E 15 ethanol The Ongoing Debate “Recent claims from some marine engine manufacturers that E 15 ethanol blends will ruin marine engines are meant solely to incite fear and not meaningful discussion. ”

Congressional Testimony Jeff Wasil, Engineer, Emissions and Compliance for Bombardier Recreational Products July 7, Congressional Testimony Jeff Wasil, Engineer, Emissions and Compliance for Bombardier Recreational Products July 7, 2011 David Hilbert, Thermodynamic Engineer for Mercury Marine November 2, 2011

What’s Next? • Continue to lobby Congress to revisit the Energy Independence Act of What’s Next? • Continue to lobby Congress to revisit the Energy Independence Act of 2007 – Freeze the blend wall at 2011 levels – Variable legal challenge to the EPA E 15 partial waiver • DOE is helping with funding for additional butanol testing: – Four in-water boats • Water ski boat • Boat with Yamaha 08 engine • Center console with Johnson 2 stroke • Runabout with Volvo. Penta engine – Laboratory testing at BRP • Durability • Cold Starting • Emissions