BILL ANALYSIS Ó
Bill No: SB
916
SENATE COMMITTEE ON GOVERNMENTAL ORGANIZATION
Senator Lou Correa, Chair
2013-2014 Regular Session
Staff Analysis
SB 916 Author: Correa
As Amended: March 19, 2014
Hearing Date: April 22, 2014
Consultant: Paul Donahue
SUBJECT
Biosynthetic lubricating oil: State procurement and retail
sale
DESCRIPTION
Effective January 1, 2016, requires state agencies that
procure lubricating oil for state vehicles to purchase
biosynthetic lubricating oil that meets specified standards
for biodegradability and that has been certified, as
specified.
Subject to certain conditions, prohibits the sale of
lubricating oil in California after January 1, 2017 unless
these specific standards are met and certifications
obtained. Specifically, this bill :
1)Defines "lubricating oil" as motor oil intended for use
in an internal combustion gasoline or diesel engine used
in passenger cars, light-duty trucks, or vans.
2)Expands the definition of "used oil" in existing law to
include synthetic oils composed of bio-based feedstock,
not just oil or synthetic oil refined from crude oil.
3)States that "minimal standards for biodegradability"
SB 916 (Correa) continued
PageB
means that the amount of biobased content<1> within the
lubricating oil is not less than 25 percent and that the
biobased content is biodegradable.<2>
4)Provides that, on and after January 1, 2016, every
procuring agency<3> in state government that purchases
lubricating oil shall only purchase biosynthetic
lubricants<4> that meet the all of the following
requirements:
a) It is a biosynthetic lubricant and meets or exceeds
minimal standards for biodegradability.
b) It is, at the time of sale, certified for use by
the American Petroleum Institute's Engine Oil
Licensing Certification System.
c) It is, at the time of sale and based on a
life-cycle analysis, certified by a third party
sustainable biomaterials certification entity to be
both of the following:
i) Produced without causing higher greenhouse gas
----------------------
<1> "Biobased content" is defined in the bill as the amount
of biobased carbon within a biosynthetic lubricant,
expressed as a percent of total weight (mass) of the
organic carbon within the product, as determined by using
the ASTM D6866-12 (standard test methods for determining
the biobased content of solid, liquid, and gaseous samples
using radiocarbon analysis), as that test method read on
January 1, 2013.
<2> This bill defines "biodegradable" to mean a substance
that can demonstrate the removal of at least 70 percent of
dissolved organic carbon; produces at least 60 percent
theoretical carbon dioxide; consumes at least 60 percent of
the theoretical oxygen demand; OR the substance meets other
specified requirements.
<3> "Procuring agency" means any state agency or any person
or entity contracting with that agency for the supply of
lubricating oil to the state.
<4> A "biosynthetic lubricant" is lubricating oil that
contains a biobased product.
SB 916 (Correa) continued
PageC
or criteria pollutant emissions than comparable
petroleum-based lubricants.
ii) Produced without having significant negative
impacts on food security.<5>
5)Specifies that before July 31, 2015, the Department of
General Services (DGS) shall provide language for a state
agency to include in a contract or grant that implements
the above biosynthetic lubricating oil procurement
requirements.
6)Specifies that, when procuring lubricating oil for
gasoline or diesel engines used in passenger cars,
light-duty trucks, and vans, a state agency, city,
county, district, including a school district and
community college district, may purchase lubricating oil
that meets the standards and is certified according to
the terms of this bill.
7)Requires DGS to list on its website the names of
lubricating oil products that meet or exceed the
standards and certifications of the bill, and transmit a
copy of this list to the University of California (UC) to
facilitate UC's procurement efforts.
8)Prohibits the sale of lubricating oil in the State after
January 1, 2017 unless the producer of the lubricating
oil files a document with the Department of Resources
Recycling and Recovery (CalRecycle), by which the
producer verifies that the lubricating oil is in
compliance with biodegradability standards and other
certifications and requirements outlined above [See
Paragraph 4), supra].
a) Requires CalRecycle to acknowledge receipt of this
self-verification by providing the producer with a
unique lubricating oil biodegradability compliance
number for each product self-verified by the producer.
-----------------------
<5> The bill authorizes a Director of the Department of
Resources, Recycling and Recovery (CalRecycle), who has
reason to believe that either of the certifications
(greenhouse gas/criteria pollutant or food security) is not
scientifically conclusive, to require another third party
sustainable biomaterials certification entity to re-examine
the certification.
SB 916 (Correa) continued
PageD
b) Specifies that by acknowledging receipt of
self-verification of compliance, CalRecycle shall not
be deemed to be ensuring the veracity of the
information provided by the producer.
c) Specifies that a producer of lubricating oil shall
verify that the biosynthetic oil meets all applicable
standards and requirements each time the lubricating
oil is re-certified by the American Petroleum
Institute's Engine Oil Licensing Certification System.
9)Authorizes the Director of CalRecycle, in consultation
with an advisory committee created by this bill , to grant
one-year delays, beginning on July 1, 2015, in both the
government procurement and retail sale mandates if the
director finds that the biosynthetic lubricating oil is
not commercially available.<6>
10)Provides that a procuring agency or sellers of oil are
allowed no longer than the later of 12 months after the
retail sale mandate, or after the end of the last of all
extensions granted by the director of CalRecycle, to sell
stock on hand, and requires that persons subject to these
mandates to maintain records for review by CalRecycle to
verify that the lubricating oil sold was in the legal
possession of the seller before those times.
11)Requires CalRecycle to inform local agencies and
individuals of the benefits of biosynthetic lubricating
oils.
12)Contains several legislative findings and declarations
claiming, among other things, that a significant source
of stormwater pollution will be reduced with the use of
biosynthetic lubricants; these lubricants will reduce
greenhouse gases; and that the benefits to public health
and the environment make biosynthetic oil a
cost-effective alternative to petroleum-based lubricating
oil.
EXISTING LAW
-------------------------
<6> In deciding whether to grant of deny an extension, the
director of CalRecycle shall consider, but not be bound by,
the recommendation of the advisory committee.
SB 916 (Correa) continued
PageE
1)Prohibits the sale of engine oil and lubricating oil
unless the product conforms to certain specifications.
2)Regulates used oil as a hazardous waste, and defines
"used oil" to mean oil that has been refined from crude
oil, or any synthetic oil, that has been used, and, as a
result of use or as a consequence of extended storage, or
spillage, has been contaminated with physical or chemical
impurities.
3)Requires state agencies and contractors with state
agencies to purchase lubricating oil containing the
greatest percentage of recycled oil, unless a specified
certification is made.
4)Requires local agencies to purchase lubricating oil that
contains recycled oil if the product meets specified
conditions.
5)The California Oil Recycling Enhancement Act,
administered by CalRecycle, imposes a charge upon the
sale of lubricating oil to provide, among other things,
grants and contracts to local governments, nonprofit
entities, and private entities and recycling incentives
to every industrial generator, curbside collection
program, and certified used oil collection center for
collected or generated used lubricating oil.
6)Establishes a goal of reducing or displacing the
consumption of petroleum products by the State fleet when
compared to the 2003 consumption levels.
7)Requires DGS, in consultation with the California
Environmental Protection Agency, members of the public,
industry, and public health and environmental
organizations, to provide state agencies with information
and assistance regarding environmentally preferable
purchasing.
BACKGROUND
1)Author's statement : According to the author's office,
biosynthetic lubricating oils, formulated with a
percentage of bio-based, biodegradable content, are newly
developed technologies that can reduce the adverse
SB 916 (Correa) continued
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environmental impacts of motor oil, improve water and air
quality, and reduce greenhouse gas emissions, all while
improving vehicle performance and fuel economy. The
author's office states that these biosynthetic
lubricating oils have performance qualities similar or
superior to other synthetic lubricants, but with added
environmental and public health benefits - the oils are
biodegradable, non-toxic and do not bio-accumulate in
marine organisms.
The author notes that used motor oil is the largest
volume of hazardous waste generated in California, with
approximately 150 million gallons of motor oil purchased
every year generating over 90 million gallons of used
oil. The author states that an estimated 14-16 million
gallons are illegally dumped, ending up in California's
rivers, lakes and streams, degrading our drinking water
supplies and adding to storm water and coastal pollution.
Furthermore, about 60 million gallons of motor oil are
lost in use, either burned in the combustion chamber or
dripped onto streets and parking lots, creating a "silent
oil spill." Federal reports indicate that used motor oil
accounts for more than 40 percent of the total oil
pollution of our nation's harbors and waterways. This oil
is, by definition, uncollectable. That these materials
are problematic to our nation's waterways and the oceans
of the world is widely understood.
Reducing the source of toxic contaminants such as
petroleum oils has significant economic and environmental
benefits. SB 916 will benefit California's water
resources and foster accelerated development of this
important, emerging technology.
2)Biosynthetic lubricants : According to the proponents,
biosynthetic lubricant manufacturing technology is well
established, and is capable of supplying a
high-performance, bio-based, biodegradable blend of
lubricating oil for use as a base oil<7> in gasoline and
diesel engines in passenger cars, light-duty trucks, and
vans. Proponents add that a recent life cycle analysis
-------------------------
<7> According to Biosynthetic Technologies, a sponsor of SB
916, finished motor oils and lubricants are formulated by
blending the base oil and additives to make the final
product.
SB 916 (Correa) continued
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shows this new technology offers an 83% to 88% reduction
in greenhouse gas emissions as compared to similar
petroleum based synthetic oils.
According to industry literature, there are a number of
advantages to bio-based crankcase oils. Technically, when
compared to mineral oils, bio-based oils have excellent
lubricity, low evaporation rates, and high viscosity
indices. The primary disadvantage of bio-based oils is
that they lack sufficient oxidative stability in their
natural form. Chemical additives and antioxidants are
being used to address this problem.<8>
Proponents state that, in the past, arguments against
lubricants sourced from biological sources have cited
poor engine protection performance, oil degradation and
cleanliness with their use. Until recently, these were
reasonable concerns, but new proprietary technologies
have shown that the motor oils currently being used by
automakers could perform equally well - or even much
better - when co-blended with as much as 25% biosynthetic
oil.
3)Is there sufficient production capacity ? Effective
January 1, 2016, SB 916 requires state agencies and state
contractors to purchase lubricating oil that meets
minimal standards and certifications, and bans the sale
of lubricating oil in California after January 1, 2017
unless it meets these minimal standards for biosynthetic
lubricants.
The author's office states that, if SB 916 were fully
implemented, approximately 32 million gallons of
biosynthetic base oil would be required, but that, per
industry estimates, there are approximately 135 million
gallons of base oil production capacity currently
available, with expansion capacity at over 330 million
------------------------
<8> Josh Pickle; "The Advantages and Disadvantages of
Biodegradable Lubricants," Machinery Lubrication, February,
2012. See also, European Renewable Resources & Materials
Association, at
http://www.errma.com/technologies/bio-based-lubricants/
SB 916 (Correa) continued
PageH
gallons.<9> The author states that, as markets develop,
investment will continue to flow to production of these
products. Many producers can manufacture bio-based
synthetic esters, with little or no modification to
existing equipment. All that is required in many
instances is to switch to a bio-based feedstock.
The author's office states further that procurement
officials now have access to environmentally superior,
cost-effective technologies such as that developed by the
USDA. Many companies have developed this biosynthetic
technology based on the USDA patents. Availability of
large quantities of bio-based base oil definitely helps
to accelerate prospects for widespread commercialization
of biosynthetic lubricants.<10>
Opponents dispute the fact that there is sufficient
production capacity of biosynthetic oils to meet the
mandates set forth in SB 916. They state that bio-based
oils are classified in the American Petroleum Institute
(API) Group V category, which requires each unique
lubricant formulation with bio-based oils to be certified
through a comprehensive testing program, which is
rigorous, expensive and time-consuming, requiring
laboratory and actual engine-use tests, and in some
cases, lengthy field tests. Qualifying a single
formulation can cost millions of dollars. The opponents
state that few if any bio-based, biodegradable lubricants
are currently approved for use, and contend that it would
likely be impossible to have enough qualified lubricants
by the 2016 state procurement deadline, let alone the
2017 retail sale mandate deadline.
The author's office responds by first noting that
biosynthetic motor oils are simply synthetic motor oils
formulated with a percentage of bio-based and
biodegradable content, and that feedstocks used to
------------------------
<9> According to information supplied by proponents, the
largest existing suppliers of biosynthetic base oils
currently operating include ExxonMobil (Louisiana), with
annual production capacity of 45 million gallons, Elevance
(Indonesia), with annual production capacity of 41 million
gallons, and BASF (Texas, France, & Germany), with annual
production capacity of 25 million gallons.
<10> See, e.g., Fuels and Lubes International Journal,
Quarter Four, pp 22- 28, 2013
SB 916 (Correa) continued
PageI
produce this motor oil are readily available. The author
further notes that practically every major oil and
chemical company in the world is investing in this
technology, including BP, Shell and Exxon.
Finally, the author states that, based on industry
recommendations, SB 916 allows the Director of CalRecycle
to grant one-year extensions to the mandates in the bill
if biosynthetic motor oils are not commercially
available. These safeguards will help ensure sufficient
supply and give the market time to adjust.
4)API certification, auto manufacturer warranties, and
related issues : As noted above, SB 916 requires state
agencies and state contractors to purchase lubricating
oil that meets minimal standards for biodegradability,
and bans the sale of lubricating oil in California after
January 1, 2017 unless it meets these minimal standards
for biodegradability.
However, the above mandates will not be imposed in
California under SB 916 unless the biosynthetic
lubricating oils are, at the time of sale, certified for
use by the Engine Oil Licensing Certification System
(EOLCS) of the American Petroleum Institute (API).<11>
The International Lubricants Standardization and Approval
Committee (ILSAC), was formed in 1992 by American and
Japanese auto manufacturers to represent their interests
to the API. Since 1992, there have been five successive
------------------------
<11> According to the API, the EOLCS is a voluntary
licensing and certification program that authorizes engine
oil marketers who meet specified requirements to use the
API Engine Oil Quality Marks. Launched in 1993, API's
Engine Oil Program is a cooperative effort between the oil
and additive industries and vehicle and engine
manufacturers Ford, General Motors, and Chrysler and those
represented by the Japan Automobile Manufacturers
Association and the Engine Manufacturers Association. The
performance requirements and test methods are established
by vehicle and engine manufacturers and technical societies
and trade associations. The EOLCS Program is backed by an
ongoing monitoring and enforcement program that ensures
licensees adhere to program requirements.
(http://www.api.org/eolcs)
SB 916 (Correa) continued
PageJ
API/ILSAC standards that have become the minimum
requirement for oil used in American and Japanese
automobiles.<12> This standard is typically amended every
3-5 years, and the next ILSAC standard (ILSAC GF-6) is
expected to be certified and introduced to the market in
January 2017.<13>
Opponents contend that, given the limitations of API and
ILSAC classifications and certifications, it is highly
unlikely that any of the biosynthetic engine oils
mandated by SB 916 would receive next generation
API/ILSAC approval in time for the planned introduction
date of these oils in 2017. Therefore, opponents question
the appropriateness of the statewide retail mandate for
these oils in SB 916 that also begins in January 2017.
The opponents add that auto manufacturers are reluctant
to grant approvals to new components with which they are
unfamiliar unless sufficient data has been developed and
real world testing has demonstrated adequate performance,
which they contend hasn't been done for bio-based
lubricating oils. Opponents suggest that this API/ILSAC
certification issue is hugely problematic for state
purchasing programs, because it raises concerns about the
risk that vehicle manufacturers will void warranties of
any vehicles using bio-based motor oil products not
licensed by API.
The author counters, first by reminding opponents that
the retail sale mandate does not take effect unless the
biosynthetic lubricating oils are, at the time of sale,
certified for use by the API. The author also notes that,
due to superior performance, many new and
high-performance vehicle manufacturers like Mercedes
Benz, BMW and Volkswagen require the use of synthetic
motor oil in their vehicles, and that biosynthetic motor
oils meet or exceed all existing motor oil standards. The
------------------------
<12> The current standard is ILSAC GF-5. Introduced in
October 2010 for 2011 and older vehicles, it is designed to
provide improved high temperature deposit protection for
pistons and turbochargers, more stringent sludge control,
improved fuel economy, enhanced emission control system
compatibility, seal compatibility, and protection of
engines operating on ethanol-containing fuels up to E85.
<13> See, e.g., http://www.pceo.com/ilsac_timeline
SB 916 (Correa) continued
PageK
author reiterates that the API and ILSAC standards are
the baseline, but states that vehicle manufacturers are
prohibited by federal law from including the requirement
of the use of a specific brand or trade name of product
or service as a condition of a warranty.<14>
5)Recycling and rerefining of used oil : CalRecycle
licenses used oil collection centers, which accept used
lubricating oil from the public and are exempt from laws
requiring hazardous waste facility permits.<15>
CalRecycle also licenses used oil recycling facilities
that convert used oil into recycled oil.<16> The recycled
oil program administered by CalRecycle promotes advances
in technologies, including use of rerefined oil in
automotive and industrial lubricants.<17> According to
CalRecycle, there are 4 used oil recycling facilities in
California, and one used oil rerefining facilities. Used
oil is managed as a hazardous waste under California
law.<18>
In 1991, the US EPA issued guidelines for used oil
management standards that classified used oil as a
hazardous waste only if it contained specific
contaminants, such as chlorine. Federal law and
regulations define used oil as "any oil that has been
refined from crude oil, or any synthetic oil, that has
------------------------
<14> This is an apparent reference to the Magnuson-Moss
Warranty Act (15 U.S.C. § 2301 et seq.), which makes it
illegal for companies to void a warranty, or deny coverage
under the warranty, simply because an aftermarket or
recycled part was used. If an aftermarket product is
defective, and causes damage to another part that is
covered under the warranty, the manufacturer or dealer has
the right to deny coverage for that part and charge for any
repairs. (See
https://www.consumer.ftc.gov/articles/0138-auto-warranties-r
outine-maintenance)
<15> Pub. Res. Code § 48622.
<16> Pub. Res. Code § 48624.
<17> Pub.Res. Code § 48632.
<18> Health & Safety Code 25250.4 (a)
SB 916 (Correa) continued
PageL
been used and as a result of such use is contaminated by
physical or chemical impurities." <19>According to the US
EPA, the first criterion for identifying used oil is
based on the origin of the oil. Used oil must have been
refined from crude oil or made from synthetic materials.
Animal and vegetable oils are excluded from EPA's
definition of used oil. In a used oil guidance document,
US EPA states that used oil is not vegetable and animal
oil, even when used as a lubricant. <20>
Relying on these federal documents and regulations,
opponents to SB 916 contend that the inclusion of
bio-based animal and vegetable oils in lubricating oil,
and ultimately, used oil, is a direct violation of
federal law and as a result, it jeopardizes the state's
increasingly successful used oil management program,
particularly since most oil recycling and all oil
rerefining is done outside California. Opponents say that
there has been no testing to determine whether bio-based
oil can be rerefined and whether it is compatible with
existing refining technology. Opponents contend that
their own internal testing suggests that used material
generated from bio-based lubricants cannot be rerefined.
Regardless of the results of any testing, opponents state
that re-refiners will not violate federal law by
accepting used motor oil that is bio-based.
The author and proponents counter argue that opponents
are ignoring federal regulations that govern mixtures of
used oil and products, such as bio-based materials, that
are also subject to regulation as used oil. In
particular, 40 CFR § 279.10(d) provides in part that
"mixtures of used oils and fuels or other fuel products
are subject to regulation as used oil?"
The issue raised is whether or not a "mixture" of used
oil containing bio-based materials would be classified as
a mixture of used oil and fuel or other fuel products.
Proponents argue that it is, and state that a clarifying
letter from US EPA should be forthcoming. Moreover,
------------------------
<19> See 42 U.S.C. § 6903; 40 CFR § 279.1
<20> See,
http://www.epa.gov/osw/conserve/materials/usedoil/usedoil.ht
m
SB 916 (Correa) continued
PageM
proponents say that this is clearly the intent of federal
laws, noting that US Department of Agriculture's
Bio-Preferred Program recently designated bio-based
crankcase oils as a new product category under the
federal procurement preference for bio-based products.
Opponents state that mixtures of used oil and other
products are expressly limited by federal regulation to
fuels, i.e., diesel.
The author and proponents also note that California
regulations define synthetic oil and specify that
"vegetable or animal oil used as a lubricant, hydraulic
fluid, heat transfer fluid, or for other similar
industrial purposes shall be managed as used oil if it is
identified as a non-RCRA [California-only] hazardous
waste."
6)Environmental benefits : The author states that, compared
to petroleum based lubricants, biosynthetic lubricants
biodegrade much faster, helping to reduce stormwater
pollution at the source. In addition to biodegradability,
biosynthetic lubricants have substantially lower toxicity
and do not bioaccumulate. The author also notes that the
Department of Defense has stated that the "control of
pollutants from automobile use could be a more direct and
cost effective method to reduce the level of contaminants
entering water bodies statewide.<21>
The author also states that, compared to petroleum based
lubricants, biosynthetic lubricants biodegrade much
faster, helping to reduce stormwater pollution at the
source. In addition to biodegradability, biosynthetic
lubricants have substantially lower toxicity and do not
-------------------------
<21> Comment letter, C.L. Stathos, Regional Environmental
Coordinator, Department of Defense, on Final Draft
Industrial General Permit, State Water Resources Control
Board, dated March 13, 2014
SB 916 (Correa) continued
PageN
bio-accumulate.<22>
A third party life cycle analysis demonstrates
biosynthetic motor oils have significantly lower
greenhouse gas emissions.<23> These motor oils reduce
piston deposits and allow for longer oil drain intervals,
providing for cleaner engines and better fuel
efficiency<24>.
The author and proponents state further that product
performance data on biosynthetic oils greatly reduced
piston deposits, and that these products have oxidative
stability, meaning that they will reduce petroleum
consumption and prevent pollution. As to
biodegradability, proponents state that testing of
biosynthetic lubricants indicate that these oils achieved
between 68% and 74% biodegradation, as compared to 41% to
47% for conventional motor oils.
Among other things, opponents argue that the desired
outcome of biodegradable lubricants will not be achieved
because fully-formulated, additized lubricants will
inhibit biodegradation of the base oil fraction and
ecotoxicity impacts will remain essentially the same as
petroleum-based lubricating oils. Opponents add that the
metal and polycyclic aromatic hydrocarbon contaminants
associated with used motor oil in storm water discharges
do not originate from the base oil, but rather occur as a
result of the lubricant being used in its intended
application.
------------------------
<22>United States Environmental Protection Agency, Office
of Waste Water Management, "Environmentally Acceptable
Lubricants," EPA 800-R-11-002, Washington, DC, November
2011,
http://nepis.epa.gov/EPA/html/DLwait.htm?url=/Exe/ZyPDF.cgi?
Dockey=P100DCJI.PDF
<23> Dustin Mulvaney, "Life Cycle Analysis of Greenhouse
Gas Emissions from Biosynthetic Base Oil (BBO) compared to
Poly-Alpha Olefin (PAO) Base Oil," EcoShift Consulting,
February 3, 2013,
http://biosynthetic.com/wp-content/uploads/Biosynthetic-Tech
nologies-GHG-LCA-Report2.pdf
<24> "Lubricant Technical Performance," Biosynthetic
Technologies,
http://biosynthetic.com/lubricant-technical-performance
SB 916 (Correa) continued
PageO
7)State procurement mandate to purchase biosynthetic oil :
Existing law requires state agencies to reduce
consumption of petroleum products in their fleet of
vehicles, including through the use of synthetic motor
oils.<25> The author and proponents state that the use of
biosynthetic lubricating oil will advance state policy to
reduce the state fleet's petroleum consumption, and will
also protect the environment. The author also notes that
the State Petroleum Reduction Plan identifies the use of
synthetic motor oil and extending the intervals between
oil changes (which is an added benefit of synthetic oils)
as a way to reduce the state fleet's consumption of
petroleum.
DGS reports that, in working to meet the statutory goals,
the State fleet has reduced its petroleum consumption by
13% and is projected to attain the 2020 goal of a 20%
overall reduction. Key to the success has been
development and implementation of a plan that has
improved the State fleet's overall use of alternative
fuels, the reduction of unneeded fleet vehicles, and
reducing unnecessary vehicle miles traveled. DGS
concludes that the State fleet is on a trajectory to
"meet or exceed the 20-percent petroleum reduction goal
by 2020." <26>
In further support of the state procurement mandate for
biosynthetic motor oil in state vehicles, proponents cite
the US Department of Agriculture's Bio-Preferred Program,
noting that the USDA program also requires a minimum 25%
bio-content for motor fuels. In addition, bio-based
crankcase oils have recently been added to the Program as
a new product category under the federal procurement
------------------------
<25> Public Resources Code § 25722.8 requires DGS to
implement a plan to improve the overall state fleet's use
of alternative fuels, synthetic lubricants, and
fuel-efficient vehicles by reducing or displacing the
consumption of petroleum products by the state fleet when
compared to the 2003 consumption level. The goal is a 20%
reduction or displacement by January 1, 2020.
<26> 2012 Progress Report For Reducing or Displacing the
Consumption of Petroleum Products by the State Fleet,
available at
http://www.dgs.ca.gov/ofam/Resources/PetrolReduc.aspx
SB 916 (Correa) continued
PageP
preference. The USDA Bio-Preferred Program designates
categories of bio-based products that are afforded
preference by Federal agencies when making purchasing
decisions.
Opponents to SB 916 contend that SB 916 would impose
significant new costs on state and local governments
because bio-based lubricant ingredients can be
substantially more costly than current base oil
components. They state that SB 916 would force
governmental agencies and the public to shoulder the
higher production cost without corresponding, measurable
reduction in environmental impacts.
8)Additional arguments in support and opposition :
Supporters believe that SB 916 will offer California
companies new opportunities to compete with the fossil
fuel industry in motor oil as well as other lubricants
and bio-based products not covered by this new standard.
Additionally, the benefits of longer intervals between
oil changes, the reduced consumption of lubricating oil
over the life of a vehicle, and the reduction in
greenhouse gas emissions make biosynthetic oils a
cost-effective alternative for vehicles in the state
fleet and in general use by Californians.
Opponents are concerned that SB 916 would establish a
troubling precedent by having the Legislature mandate an
unproven technology based on speculative benefits and
without regard for predictable impacts on the private and
public sectors. If added testing bears out the sponsor's
claims, opponents suggest that biosynthetic lubricating
oil will succeed in the marketplace on its own merits,
and it does not need a market share guaranteed in state
law.
9)Lubricating oil definitions : The definition of
"lubricating oils" in existing law differs from that
which is contained in SB 916. In Section 48618 of the
Public Resources Code, "lubricating oil" includes, but is
not limited to, "any oil intended for use in an internal
combustion engine crankcase, transmission, gearbox, or
differential in an automobile, bus, truck, vessel, plane,
train, heavy equipment, or other machinery powered by an
internal combustion engine." In SB 916, "lubricating oil"
means "oil intended for use in an internal combustion
SB 916 (Correa) continued
PageQ
gasoline or diesel engine used in passenger cars,
light-duty trucks, or vans." To avoid confusion, SB 916
should be amended to conform to the more complete
definition of "lubricating oils" in Pub. Res. Code §
48618. Alternatively, SB 916 should be amended to
expressly acknowledge that the definition of "lubricating
oil" in SB 916 is intended to be narrower than that which
exists in existing law.
PRIOR/RELATED LEGISLATION
SB 546 (Lowenthal), Chapter 353, Statutes of 2009. Raised
the recycling fee paid by lubricating oil manufacturers
from $0.16 to $0.26 per gallon; increased the incentives
paid for recycling used oil; increased the testing
requirements for used oil transporters and requires a life
cycle analysis of used oil.
AB 236 (Lieu), Chapter 593, Statutes of 2007. Among other
things, established the goal of reducing or displacing the
consumption of petroleum products by the State fleet when
compared to the 2003 consumption levels
AB 1201 (Pavley), Chapter 317, Statutes of 2001. Added
stormwater pollution mitigation and education projects to
the activities considered as eligible projects for the
various competitive grant programs funded through the
California Used Oil Recycling Fund, upon approval of the
California Integrated Waste Management Board (CIWMB).
SB 1979 (O'Connell), Chapter 901, Statutes of 1996. Among
other things, mandates a funding level for CIWMB grants and
loans for used oil research, testing and demonstration
projects designed to develop uses and markets for products
resulting from the recycling of used oil. Includes asphalt
flux produced from the reprocessing or re-refining of used
oil as a recycled material to be used in specified paving
materials purchased by the California Department of
Transportation.
SB 734 (Rosenthal), Chapter 939, Statutes of 1993. Requires
state agencies to purchase rerefined products when they are
of the same quality and not more than 5 percent more costly
than virgin lubricants.
AB 712 (Sher) Chapter 675, Statutes of 1993. Extended from
SB 916 (Correa) continued
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70 to 120 the number of days the CIWMB has to report on
accumulated industrial and lubricating oil sales and used
oil recycling rates. Created a misdemeanor for making a
false claim of exemption from payment of used oil recycling
fees, punishable by imprisonment for not more than one year
and a fine not to exceed $5,000. Made other technical
amendments to the Used Oil Recycling Program.
AB 2076 (Sher), Chapter 817, Statutes of 1991. Enacted the
California Oil Recycling Enhancement Act, creating a Used
Oil Recycling Program to promote and develop alternatives
to the illegal disposal of used oil. Among other things,
requires certified collection centers to accept used oil
from the public, without charge, during business hours, and
to remit recycling incentives to those who bring oil to the
centers.
SUPPORT:
Biosynthetic Technologies (sponsor)
Orange County Coastkeeper (sponsor)
Algae Biomass Organization
American Logistics Company
American Neuro-Psychiatric Network, Inc.
American Sustainable Business Council
Arnel & Affiliates
ASEA Holdings, LLC
Athletes First
Bioamerica
Beta Analytic, Inc.
Blue River Advisors
California Black Health Network
CleanTECH San Diego
EcoShift Consulting (Dustin Mulvaney, Principal)
Elevance Renewable Science, Inc.
Environmental Defense Fund
Flexi-Liner Corporation
G-C Lubricants Company
Green Earth Technologies
Insight Accounting
Insight Wealth Strategies
Jerry Kohlenberger
Marine Watch
Mission Blue
Modlar, Inc.
SB 916 (Correa) continued
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M-Wave International
Nettleton Strategies, LLC
Newport Bay Hospital
Ohio State University, Bioproduct Innovation Center (Dennis
Hall, Director)
Preferred Hotel Group
Redwood Innovation Partners
Sapphire Energy, Inc.
Scheweickert and Company
Searles Company
Solazyme, Inc.
Strategic Ocean Solutions
T2e Energy
Verdezyne
Wildcoast
World Innovation
OPPOSE:
Alliance of Automobile Manufacturers
American Chemical Council
Associated Builders and Contractors of California
Automotive Specialty Products Alliance
California Chamber of Commerce
California Construction Trucking Association
California Council for Environmental and Economic Balance
California Independent Oil Marketers Association
California League of Food Processors
California Manufacturers and Technology Association
California Metals Coalition
Center for Food Safety
Chemical Industry Council of California
Clean Harbors
Coalition of Energy Users
Consumer Specialty Products Association
Enterprise Holdings (Enterprise Rent a Car)
Independent Lubricant Manufacturers Association
Independent Oil Producers Association
Kern County Taxpayers Association
Motor and Equipment Manufacturers Association
National Federation of Independent Business
Safety-Kleen
Santa Barbara Technology and Industry Association
Small Business Action Committee
Truck and Engine Manufacturers Association
Western States Petroleum Association
SB 916 (Correa) continued
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DUAL REFFERRAL : Senate Environmental Quality Committee
FISCAL COMMITTEE: Senate Appropriations Committee
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