BILL ANALYSIS Ó AB 1126 SENATE COMMITTEE ON ENVIRONMENTAL QUALITY Senator Jerry Hill, Chair 2013-2014 Regular Session BILL NO: AB 1126 AUTHOR: Gordon AMENDED: June 19, 2013 FISCAL: Yes HEARING DATE: June 26, 2013 URGENCY: No CONSULTANT: Rebecca Newhouse SUBJECT : MUNICIPAL SOLID WASTE CONVERSION SUMMARY : Existing law , under the Integrated Waste Management Act of 1989 (Act): 1) Requires each city or county source reduction and recycling element to include an implementation schedule that shows a city or county must divert 25% of solid waste from landfill disposal or transformation by January 1, 1995, and must divert 50% of solid waste on and after January 1, 2000 through source reduction, recycling, and composting activities (Public Resources Code §41780). 2) Declares that it is the policy goal of the state to divert 75% of the state's solid waste through source reduction, recycling and composting by 2020 (PRC §41780.01). 3) Defines "transformation" as incineration, pyrolysis, distillation, or biological conversion and does not include composting, gasification, or biomass conversion (PRC §40201). 4) Defines "transfer or processing station" as those facilities utilized to receive solid wastes, temporarily store, separate, convert, or otherwise process the materials in the solid wastes, or to transfer the solid waste directly from smaller to larger vehicles for transport and those facilities utilized for transformation (PRC §40200). 5) Defines "solid waste disposal" for the purposes of AB 1126 Page 2 preparing integrated waste management plans, as the management of solid waste through landfill disposal, transformation (PRC §40192). 6) Defines "disposal facility" to mean a facility or location where disposal or solid waste occurs (PRC §40121). 7) Specifies that "solid waste facility" include a solid waste transfer or processing station, a composting facility, gasification facility and a disposal facility (PRC §40194). 8) Requires each county to prepare a countywide siting element that provides a description of the areas to be used for development of adequate transformation or disposal capacity concurrent and consistent with the development and implementation of the county and city source reduction recycling requirements and requires the countywide siting element to be approved by the county and by a majority of cities within the county with a majority of the population (PRC §§41700, 41721). 9) Prohibits a person from disposing of solid waste, arranging for the disposal of solid waste, transporting solid waste for purposes of disposal, or accepting solid waste for disposal, except at a solid waste disposal facility for which a solid waste facilities permit has been issued, as specified (PRC §44000.5). 10)Prohibits the establishment or expansion of a solid waste facility in the county unless the solid waste facility is a disposal facility or a transformation facility which is identified in the countywide siting element or amendment to the element, or is a solid waste facility that is designed to recover for reuse or recycling at least 5% of the total volume of material received by the facility and has been identified in the nondisposal facility element that has been approved, as specified (PRC §50001). This bill : 1) Defines "engineered municipal solid waste conversion," or "EMSW conversion," as the conversion of solid waste through a process that meets all the following requirements: AB 1126 Page 3 a) The waste to be converted is beneficial and effective in that it replaces or supplants the use of fossil fuels. b) The waste to be converted, the resulting ash, and any other products of conversion do not meet the criteria or guidelines for the identification of a hazardous waste adopted by the Department of Toxic Substances Control, as specified. c) The conversion is efficient and maximizes the net calorific value and burn rate of the waste. d) The waste to be processed contains less than 25 percent moisture and less than 25 percent noncombustible waste. e) The waste to be processed is handled in compliance with the solid waste handling requirements, as specified, and no more than a seven-day supply of that waste, based on the throughput capacity of the operation or facility, is stored at the facility at any one time. f) No more than 500 tons per day of waste is converted at the facility where the operation takes place. g) The waste has a value of 5,000 BTU per pound after conversion. 2) Defines an "engineered MSW conversion facility" as a facility where municipal solid waste conversion that meets the above requirements takes place. 3) Specifies that "recycling" does not include EMSW conversion. 4) Specifies that "solid waste disposal" includes processed EMSW conversion and that a "solid waste facility" or "disposal facility" includes an EMSW conversion facility. 5) Specifies that a "transfer or processing station" does not include an EMSW conversion facility. AB 1126 Page 4 6) Specifies that "transformation" does not include processed EMSW conversion. 7) Requires a countywide siting element to include a description of areas to be used for MSW conversion and allows a siting element provided for an MSW conversion facility to only be approved by the city in which it is located, or if the MSW is not located in a city, by the county. 8) Specifies that tires and biomass processed by conversion facilities are not considered disposal under the Act. 9) Prohibits the establishment or expansion of a solid waste facility in the county unless the solid waste facility is a disposal facility, transformation, or engineered MSW facility, which is identified in the countywide siting element or amendment to the element, or is a solid waste facility that is designed to recover for reuse or recycling at least 5% of the total volume of material received by the facility and has been identified in the nondisposal facility element that has been approved, as specified. COMMENTS : 1)Purpose of Bill . According to the author, "AB 1126 defines an Engineered Municipal Solid Waste conversion facility and properly identifies it as a solid waste facility under CalReycle's regulatory authority. This permitting pathway is needed because current statute is outdated and does not adequately address the new types of waste-to-energy technologies and processes that have started to be commercialized in California. Existing state solid waste rules do not adequately define these facilities to provide the best-possible environmental protection and oversight while minimizing unnecessary burdens. Under this bill, engineered MSW conversion would be clearly defined, and would allow these facilities to replace fossil fuel energy sources such as coal, thereby reducing California's GHG emissions. Properly utilized, AB 1126 would help California meet the goals outlined in AB 32." AB 1126 Page 5 2)Background . Municipal solid waste . Municipal solid waste (MSW) refers to the stream of garbage collected through community sanitation services. Although MSW consists mainly of renewable resources such as food, paper, and wood products, it also includes nonrenewable materials derived from fossil fuels, such as tires and plastics. According to the 2008 Statewide Waste Characterization Study, the California waste stream is composed of primarily food and greenwaste (e.g., lumber, leaves, etc.) at about 47%, with the next highest contributors being paper, plastic and metal waste comprising 17.3%, 9.6%, and 4.6%, respectively. Conversion technologies . According to CalRecycle, conversion technologies are processes that can convert organic materials into usable forms of energy including heat, steam, electricity, natural gas, and liquid fuels. Thermochemical conversion processes are characterized by higher temperatures and faster conversion rates and include combustion, gasification, and pyrolysis. Pyrolysis is the thermal decomposition of feedstock at high temperatures (greater than 400?F) in the absence of air, whereas gasification is a process that uses air or oxygen and high heat, (typically above 1300?F) to convert feedstock into a synthetic gas or fuel gas. Gasification uses less air or oxygen than incineration processes. Thermochemical conversion is best suited for lower moisture feedstocks. Biochemical conversion processes include aerobic conversion (i.e., composting), anaerobic digestion (which occurs in landfills and controlled reactors or digesters), and anaerobic fermentation (for example, the conversion of sugars from cellulose to ethanol). Biochemical conversion proceeds at lower temperatures and lower reaction rates. Higher moisture feedstocks are generally good candidates for biochemical processes. The definition of transformation in current law captures many thermochemical and biochemical conversion technologies, but some processes that would technically qualify as conversion are specifically excluded by statute, namely AB 1126 Page 6 composting, gasification and biomass conversion (i.e., combustion of greenwaste). AB 1126 specifies that engineered MSW conversion is not included in the definition of "transformation" and would instead define MSW conversion based on whether a process meets a defined set of criteria, as specified in the bill. Some of the processes defined as "transformation" including combustion, pyrolysis, distillation, or biological conversion may be able to meet the performance criteria of EMSW conversion. In order to be technology neutral, an amendment is needed to specify that, notwithstanding the definition of transformation, a transformation facility that meets the requirements of an engineered municipal solid waste facility shall be considered to be an engineered MSW facility. 3)Environmental impacts of MSW conversion . According to CalRecycle, combustion or incineration is a type of thermochemical "conversion" technology. There is a variety of conversion technologies and depending on the technology and controls they use to mitigate negative environmental impacts, the environmental impacts of an individual conversion facility can significantly vary. The conversion of MSW reduces MSW waste streams, reducing the creation of new landfills. MSW combustion creates a solid waste called ash that can contain any of the elements that were originally present in the waste. MSW conversion facilities reduce the need for landfill capacity because disposal of MSW ash requires less land area than does unprocessed MSW, however, depending on the waste stream, MSW ash can concentrate toxic constituents that were originally present in the MSW and can create new toxic chemicals, depending on the chemical makeup of the feedstock and reaction conditions. Some conversion processes, such as gasification, use temperatures that can create a glass-like or vitreous ash, where potential toxins in the ash are bound in the glass matrix. In terms of air quality, MSW conversion can produce AB 1126 Page 7 greenhouse gases, criteria air pollutants such as nitrogen oxides and sulfur dioxides, and trace amounts of toxic air contaminants such as mercury, dioxins and furans. The GHGs released from the biomass-derived portion of MSW conversion facilities is considered to be renewable since the plants and trees that make up the paper, food, and other biogenic waste removed carbon dioxide from the air while they were growing, which is returned to the air when this material is burned. The types and quantities of air emissions vary depending on the MSW conversion technology. For example, combustion of MSW may result in a much larger quantity of nitrogen oxides then pyrolysis, which does not use oxygen in the conversion process. A variety of air pollution control technologies can be used to reduce criteria and toxic air pollutants. In addition, burning MSW instead of landfilling can achieve significant GHG benefits due to the prevention of methane formation, which is approximately 21 times more powerful in terms of global warming potential than CO2. Under AB 1126, no MSW conversion process that converted hazardous waste or resulted in ash that is classified as hazardous according to DTSC, would qualify as an engineered MSW conversion process. AB 1126 would not alter existing law that requires all stationary sources of air pollution to comply with all local, state and federal air and water quality rules and regulations, including requirements under the federal Clean Air Act, Clean Water Act, additional local requirements and state GHG regulations pursuant to AB 32. 4)Solid Waste Facility Permits . In1994, regulations were adopted implementing a tiered regulatory structure for the permitting of all solid waste facilities and solid waste handling operations, including solid waste transfer or processing stations, composting facilities, transformation facilities, and disposal facilities. According to CalRecycle, the structure was designed to provide a level of regulatory oversight commensurate with the impacts associated with a particular solid waste handling or disposal activity. From the highest level of regulation to the lowest, the tiers are full, standardized, registration, enforcement agency notification, and facilities that are excluded from permitting. A full permit is required for solid waste landfills, large composting operations, AB 1126 Page 8 transformation facilities and other waste operations that are typically large volume. Engineered MSW conversion facilities, as defined by AB 1126, would qualify for the highest level of regulatory compliance and require full permits approved by CalRecycle. 5)Countywide siting elements . Disposal facilities must obtain a Solid Waste Facility Permit. One of the requirements to obtain a permit is for that facility to be identified in the countywide siting element (CSE) which is one component of an Integrated Waste Management Plan for a jurisdiction. A CSE contains a description and identification of areas, numbers, and types of new or expanded solid waste disposal and transformation facilities to meet a minimum of 15 years of combined permitted disposal capacity. If new or expanded facilities cannot be established, then a discussion of strategies selected by the local jurisdiction to dispose of the excess solid waste is included. The element also includes a discussion and description of the siting criteria used in the county's siting process for new or expanded solid waste disposal or transformation facilities. The siting criteria are required to address environmental considerations, environmental impacts, socio-economic and legal considerations, and any other additional criteria included by jurisdictions that approve the element. The CSE and any subsequent amendments must be approved by the county and by the majority of the cities within the county that contain the majority of the population of the incorporated area. This approval is known as the "majority/majority" requirement. More cities within a particular county make this process more involved and it can take years before a facility is approved. AB 1126 requires any engineered MSW conversion facility be described in the CSE, but its addition would only require approval by the city where the project will be located, or if not located in a city, by the county. 6)MSW thermal conversion . There are currently three commercial facilities in the state that use combustion technology to combust unprocessed or minimally processed solid waste. AB 1126 Page 9 Collectively, they have the capacity to process 2,500 tons per day of MSW and produce about 68 MW of electrical power. In terms of the MSW that they process per day, only one (Commerce Refuse-to-Energy facility in Commerce, CA) would meet the criterion for engineered MSW conversion of processing not more than 500 tons per day of MSW. It is unclear whether the facility would meet the other requirements for Engineered MSW, including having a moisture content and noncombustible waste fraction of less than 25%. The two other facilities, Covanta Stanislaus and Long Beach SERRF process 800 and 1,380 tons per day of MSW. In order to meet the criteria of an engineered MSW conversion under AB 1126, traditional stream MSW conversion would most likely have to be processed or engineered in some way in order to remove certain organic waste or noncombustibles, as well as other materials that do not readily undergo conversion into electricity, heat or fuel to meet the requirements of a moisture content below 25% and noncombustible waste below 25%, as well as ensuring the conversion is efficient and maximizes the net calorific value and burn rate of the waste. However, certain MSW waste streams, depending on where they are generated from, may be able to meet the requirements without being mechanically processed before conversion. In addition, some of this MSW may contain chlorinated plastics, such as polyvinylchloride (PVC), which may release certain toxic air contaminants when converted. An amendment is needed to require that MSW be mechanically processed at some type of transfer and processing station before conversion in order to prevent raw MSW from qualifying as EMSW, and to reduce the fraction of chlorinated plastics and other materials that do not maximize the net calorific value and burn rate of the waste. 7)Solid waste diversion . Prior to 2008, diversion estimates of solid waste for jurisdictions were performed by calculating the quantity of solid waste generation and estimating the amount of diversion. SB 1016 (Wiggins) Chapter 343, Statutes of 2008, changed the diversion calculation by only considering the quantity of disposal, as reported by AB 1126 Page 10 disposal facilities and the population of the jurisdiction, and comparing that value to a baseline rate of disposal determined from the disposal rate as of January 1, 1990. All waste converted at an engineered MSW conversion facility would be counted as disposal for the purpose of determining the diversion rate, excluding tires and biomass. Tires and biomass excluded ? The bill would exempt any tires or biomass from being counted as solid waste for the purposes of determining diversion rates when converted at engineered MSW conversion facilities. Biomass incinerated at biomass conversion facilities is not counted as disposal under current law. Tires are counted as disposal under current law if they are disposed of at a disposal facility or a transformation facility. However, tires that are burned at facilities that are not permitted as disposal or transformation facilities, such as cement kilns, are not regulated by CalRecycle, and therefore, have not counted as disposal under current law. To the extent that entities previously unregulated by CalRecycle meet the criteria of an engineered MSW conversion facility, the exemption for counting tires as disposal will be consistent with current practice. One impetus for facilities previously unregulated by CalRecycle, such as cement manufacturers, for potentially seeking classification and permitting as "engineered MSW conversion facilities" is so that they might reduce their emissions under AB 32 and cap-and-trade. Cement manufacturers currently primarily burn coal and switching to MSW represents a significant reduction in GHG emissions, since the biogenic portion of any engineered MSW that they convert is not counted toward their GHG emissions under cap-and-trade, and therefore reduces their costs associated with purchasing allowances and offsets to meet their compliance obligation under the cap-and-trade program. 8)Energy content . One of the criteria in order to meet the definition of EMSW conversion specified in AB 1126 is that, AB 1126 Page 11 after conversion, the waste have an energy value of 5,000 BTU per pound. As written, this requirement does not make sense, since it is the conversion of the engineered waste, and not the waste after conversion (which is typically ash), that has an energy value that can be expressed in terms of BTU. An amendment is needed to strike the language that references "after conversion" and instead require that the engineered waste must have an energy content equal to or greater than 5,000 BTU per pound. 9)Engineered MSW conversion does not qualify for RPS credit . Under the Renewable Portfolio Standard, investor-owned utilities (IOUs) and publicly owned utilities must achieve 33% of their energy sales from an eligible renewable electrical generation facility by December 31, 2020. Municipal solid waste conversion, in order to qualify as a renewable electrical generation facility, must meet numerous conditions, one of which being that it does not use air or oxygen in the conversion process, except ambient air to maintain temperature control, and that it produces no discharges of air contaminants or emissions, including greenhouse gas emissions and does not produce any discharges to surface or groundwaters of the state. No current technology can meet those stringent statutory requirements. Meeting the requirements of an engineered MSW conversion as defined by AB 1126, is not sufficient to be considered MSW conversion for the RPS credit. In fact, only if technology advances to a point where no criteria or toxic air pollutants or GHGs are released through MSW conversion will any type of conversion using MSW potentially qualify for RPS credit. SOURCE : Author SUPPORT : None on file OPPOSITION : None on file AB 1126 Page 12