BILL ANALYSIS Ó SB 804 Page 1 Date of Hearing: September 10, 2013 ASSEMBLY COMMITTEE ON ENVIRONMENTAL SAFETY AND TOXIC MATERIALS Luis Alejo, Chair SB 804 (Lara) - As Amended: September 9, 2013 SENATE VOTE : 32-7 SUBJECT : Biomass SUMMARY : Specifies that conversion technologies that use specified biomass feedstocks are included in the definition of "biomass conversion" for purposes of the Integrated Waste Management Act (IWMA). Specifically, this bill : 1)Adds "conversion technologies other than controlled combustion" to the definition of biomass conversion. 2)Defines "biomass conversion technology facility" as a facility that uses a conversion technology capable of converting biomass into marketable products and fuels through noncombustion thermal, chemical, or biological processes. Specifies that a biomass conversion technology facility does not include composting or biomass controlled combustion. 3)Requires biomass conversion technology facilities to: a) Certify to the air district (e.g., air quality management districts and air pollution control districts) that a local agency sending biomass to the facility is in compliance with the IWMA; and, b) Allow Department of Resource Recycling and Recovery (CalRecycle), consistent with their existing authority to inspect legal and illegal solid waste facilities, to inspect the facility to ensure that the facility is only processing biomass that meets the local certification requirement and is limited to the "biomass eligible waste stream." 4)Requires CalRecycle to notify the air district within 48 hours if there is a violation of the state's solid waste laws, and requires the air district to investigate and begin necessary enforcement actions. SB 804 Page 2 5)Requires an air district, prior to issuing a permit for a biomass conversion technology facility, to determine whether or not the facility meets the requirements for best available control technology for criteria air pollutants, toxic air contaminants, and greenhouse gases. 6)Requires the applicant for a biomass conversion technology facility to demonstrate to the local land use permitting agency that the technology to be used: a) Is designed to cause no net increase in toxic air contaminants or criteria air pollutants when compared to existing biomass controlled combustion technology; b) Is not designed to produce hazardous waste as a byproduct of the technology; and, c) Complies with a state law relating to biomass conversion ash. EXISTING LAW : 1)Requires cities and counties to divert 50% of the solid waste disposed within their jurisdiction through source reduction, recycling, and composting, but authorizes a city or county to comply with up to 10% of the 50% diversion requirement through biomass conversion. This requirement is contained in the IWMA. 2)Defines "biomass conversion" as the controlled combustion of agricultural waste, yard and garden clippings, leaves and forestry residue, wood chips, wood waste and non-recyclable pulp or non-recyclable paper materials when these substances are separated from other solid waste. The combustion of these materials is used for producing electricity or heat. 3)Excludes from the definition of "biomass conversion" the controlled combustion of pulp or paper materials, sewage or industrial sludge, medical, hazardous, or radioactive wastes. FISCAL EFFECT : According to the Assembly Appropriations Committee, the bill is likely to increase costs to CalRecycle in the $160,000 range for rulemaking and enforcement. COMMENTS : SB 804 Page 3 1)Need for the bill . According to the author, existing California law defines "biomass conversion" as the direct combustion of certain listed types of biomass materials. This definition excludes conversion technologies that can more efficiently generate electricity from biomass with lower air emissions. Additionally, existing law is unclear regarding how anaerobic digestion facilities should be permitted. This hampers the state's goals of diverting additional organic materials from disposal." 2)Biomass in California According to the State Energy Commission, at present biomass in California is converted to electric power though one of two processes based on the characteristics of the biomass. Two-thirds of California's biomass power capacity is generated by the direct combustion of solid biomass in boiler-steam turbine plants, ranging in size from about 5 to 50 MW. The remainder is generated by the combustion of landfill gas and biogas in a range of power generating equipment including boiler-steam turbine systems, reciprocating engines, and gas turbines. According to information from the California Biomass Collaborative, there are 22 biomass conversion facilities in commercial operation in California. These plants are located throughout the state, often near timber harvest or agricultural operations. Most of these facilities were built in the 1980s or early 1990s, after the federal Public Utilities Regulatory Policy Act of 1978 required utilities to purchase power provided by qualifying independent power producers at relatively attractive rates. However, California's regulatory policies were restructured in 1996, decreasing the financial incentives available for biomass conversion facilities. Biomass facilities are generally subject to local air quality district regulations and permit requirements. For new or modified facilities, "New Source Review" (NSR) regulations may require the use of "best available control technology" (BACT) for particulate matter, sulphur oxides and nitrogen oxides or other emissions. NSR may also require the use of emission reduction credits (ERCs). In addition, federal rules that govern the permitting of new or modified facilities may apply. The primary green house gas (GHG) emitted from biomass conversion plants is carbon dioxide, which is not controlled. SB 804 Page 4 Pending Biomass Projects . The County of Los Angles (a sponsor of the proposed legislation) has undertaken a Conversion Technology Demonstration Project and has approved three conversion technology demonstration projects designed to address the dwindling landfill space in Los Angeles. To date, none of the proposed projects would rely on a biomass conversion technology include in this bill. According to the CalRecycle, one potential project that may be affected by his change in facility definition is the Cabin Creek Biomass Facility Project Truckee, Placer County. Placer County is proposing to construct a two-megawatt (MW) wood-to-energy biomass facility at the Eastern Regional Materials Recovery Facility (MRF) and Transfer Station that would use a gasification technology. 3)Biomass Projects Problems in California . Some biomass facilities in California a have a history of environmental issues including Clear Air Act violations. In 2011, the U.S. Environmental Protection Agency and the San Joaquin Valley Air Pollution Control District lodged consent decrees against two biomass power plants in Chowchilla and El Nido, California. The two companies have agreed to pay a combined civil penalty of $835,000 to resolve alleged violations of the federal Clean Air Act and District rules, including excess emissions of air pollutants such as nitrogen oxides, a precursor to ozone, and fine particulates. 4)Arguments in Support . Support for this bill comes from local government including Ventura County who stated: "SB 804 redefines the term "biomass conversion" to include other conversion?. Such technologies promote the highest and best use of resources while supporting the state's key environmental goals. Ventura County supports the vision of solid waste as a potential local resource rather than material destined for disposal within our local landfills. Further, by including conversion technology as a viable option for solid waste management, we can address the state's Bioenergy Plan, which has identified municipal solid waste as a substantially underutilized resource for biomass feedstock; not only can this feedstock produce renewable fuels and energy but it can also help achieve the environmental goals established by AB 32, including the Renewable Portfolio SB 804 Page 5 Standard, Low Carbon Fuel Standard and reducing Green House Gas (GHG) emissions. California can benefit from conversion technologies through their potential to create green jobs, reduce greenhouse gas emissions and other pollutants, reduce groundwater contamination, produce green fuels and electricity, and improve recycling rates while diverting trash from our state's landfills." 5)Arguments in Opposition . Opposition to this bill from environmentalists raise concerns about the safety of conversion technologies. According to the Sierra Club California, "Conversion technologies using high-heat processes like pyrolysis and gasification bear substantial similarities to incineration. Combustion for energy production is responsible for air, water and land pollution. These pollutants, including smog, acid rain, and persistent bioaccumulative toxics, threaten human health and the environment. Since burning produces CO2, biomass conversion technologies can aggravate global warming. The EPA now suggests it is not safe to assume biomass power plants are carbon neutral." 6)Related legislation : a) AB 997 (Chesbro) of 2013 defines anaerobic digestion in the Integrated Waste Management Act and amends the definition of composting to include anaerobic digestion processes. AB 997 is on the Senate Inactive File. b) AB 1126 (Gordon) of 2013 adds thermal conversion to the definition of biomass conversion, clarifies that composting includes anaerobic digestion, and makes other changes related to municipal solid waste conversion. AB 1126 is on the Assembly Floor awaiting Concurrence in Senate amendments. 7)Double Referral . SB 804 was heard in the Assembly Natural Resources Committee on July 1, 2013 and passed on a 9 to 0 vote. REGISTERED SUPPORT / OPPOSITION : Support County of Los Angeles (sponsor) SB 804 Page 6 California State Association of Counties (sponsor) City of Torrance County of Ventura Environmental Problem Solving Enterprise North Valley Coalition of Concerned Citizens, Inc. Salinas Valley Solid Waste Authority Opposition Global Alliance for Incinerator Alternatives Greenaction for Health and Environmental Justice Sierra Club California Analysis Prepared by : Bob Fredenburg / E.S. & T.M. / (916) 319-3965