I'm no expert on emission control (or Amazons, for that matter), but I would imagine to meet CA 2007 standards in a 122:

1- you'd absolutely need a tight, well-tuned engine (holds compression, good sealing valves and rings, etc), and

2- you'd absolutely need a catalytic converter, and

3- you'd probably need fuel injection (i.e. engine swap to a F.I. B20).


as far as difficulty and cost...

(1) is fairly straightforward. People rebuild old Volvo engines all the time. Depending on how much work you're willing to do yourself, and where you aim on the stock~performance spectrum, a top and bottom rebuild runs roughly $1k-$5k. Sometimes people get lucky and find recently rebuilt or low-milage engines for less.

(2) I think cat hardware runs roughly $500-$1.5k. Figure another couple hundred bucks at the muffler shop in labor.

(3) Having never worked with a F.I. B20, I can't really comment on this. Suffice to say that there are a variety of ways of doing this (stock, Megasquirt, etc), and again, a broad range of costs, depending how you want to go about it.

All in all, I imagine you could attempt this project (to meet CA emission standards in a 122) with a low budget of maybe $3k and a lot of work.

Again, I'm no expert. I'm sure others can weigh in.

(Maybe there is some absolute barrier to success that I'm not aware of; i.e. "a pushrod engine can never meet CA standards because _______")