BILL ANALYSIS
AB 907
Page 1
Date of Hearing: April 27, 2009
ASSEMBLY COMMITTEE ON NATURAL RESOURCES
Nancy Skinner, Chair
AB 907 (Chesbro) - As Amended: April 14, 2009
SUBJECT : California Oil Recycling Enhancement Act: rerefined
oil.
SUMMARY : Increases the recycling fee on lubricating oil sold in
the state, increases the collection and recycling incentive
payments awarded by the California Integrated Waste Management
Board (CIWMB), and makes related changes to the California Used
Oil Recycling and Enhancement Act (Act).
EXISTING LAW , pursuant to the Act, which is administered by
CIWMB, establishes a used oil recycling program designed to
discourage the illegal disposal of used oil. The Act requires
oil manufacturers to pay a 16 cent fee to CIWMB for each gallon
of lubricating oil sold in California. Registered industrial
generators, curbside collection programs, and certified
collection centers are eligible to receive a 16 cent incentive
payment for each gallon of used lubricating oil recycled.
THIS BILL : Updates, clarifies, and makes numerous changes to
the Act, including:
1)Defines "rerefined oil."
2)Authorizes CIWMB to enter into public and private partnerships
with local governments, nonprofit organizations, and private
entities to encourage the collection and recycling of used
oil.
3)Increases the recycling fee collected on lubricating oil from
4 cents per quart to 6 cents and authorizes CIWMB to adjust
the fee annually to reflect changes in the California Consumer
Price Index.
4)Increases the recycling incentive awarded by CIWMB to
industrial generators, curbside collection programs, and
certified used oil collection centers for used oil collected
from a minimum of 4 cents per quart to a minimum of 10 cents
per quart. Authorizes CIWMB to award this incentive to
registered or certified out-of-state facilities, as specified.
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5)Authorizes CIWMB to award a rerefining incentive to registered
or certified in-state and out-of-state facilities of not less
than 2 cents per quart to promote the rerefining of used oil.
6)Increases the total amount of payments issued by CIWMB to
local governments for local used oil collection programs from
$10 million to $13 million annually.
7)Lengthens the certification term for used oil collection
centers from two years to four years.
FISCAL EFFECT : Unknown
COMMENTS :
1)Background
According to CIWMB, used oil can contain toxic substances,
including benzene, lead, zinc, and cadmium. The oil from a
single oil change can ruin the taste of a million gallons of
drinking water, the supply of 50 people for one year.
Improperly disposed oil, such as dumped in the storm drain,
harms surface water by preventing the replenishment of dissolved
oxygen, and impairs photosynthetic processes. Improper
disposal onto land pollutes soil and groundwater supplies.
In 2008 CIWMB released the report, Improving Used Oil Recycling
in California, which was prepared by the Lawrence Livermore
National Laboratory. According to the report, in 2006
approximately 115.8 million gallons, or 71% of all used oil
generated in the state, was collected. 45.7 million gallons
(approximately 4 times the amount spilled by the Exxon Valdez)
is unaccounted for. Of the oil collected in California, only
10% is currently rerefined, even though rerefineries in the
state are operating at maximum capacity. The remainder is used
for energy generation out-of-state or is processed into marine
diesel oil (MDO).
According to the American Petroleum Institute, "rerefined oil is
as high quality as virgin product. In fact, rerefining used oil
uses from 50% to 80% less energy than refining crude oil."
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2)This bill
According to the author, this bill would authorize [CIWMB] to
develop a program to provide incentives to manufacturers of
rerefined oil and to develop additional capacity for the
rerefining of used oil within the state." Because California's
strict air emissions standards do not allow the burning of used
oil for energy generation, 85% of used oil collected is
transferred to out-of-state energy facilities where the oil is
burned, untreated, and contributes to greenhouse gas emissions.
3)Clarification needed
The language in this bill contains unclear provisions and
drafting errors. The author may wish to amend the bill to add
clarity and correct the drafting errors as follows:
a) Delete Section 1 of the bill (Public Resources Code
48100), which is not relevant to the subject matter of the
bill.
b) Section 48631(b) (beginning on page 6, line 37) should
be amended to specify that the public and private
partnerships may include grants and contracts.
c) Section 48650(c) (page 10, lines 7 and 8) is obsolete
and should be repealed.
d) Section 48651(a)(2) and (b) (page 10, lines 20-26 and
page 11, lines 5-7) should be amended to clarify that the
provision applies to out-of-state facilities that are
registered or certified by CIWMB pursuant to Section 48662.
e) On page 14, line 7, delete "by the act adding this
paragraph." On page 14, lines 10-14, delete "including the
implementation of the reporting, monitoring, and
enforcement program pursuant to subdivision (d) of Section
48631." On page 14, lines 15 and 16, delete "the sum of."
These provisions are redundant.
f) In Section 48673 (page 21, line 3), delete "Beginning
July 1, 2991" as this provision is obsolete.
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g) In Section 48690 (page 21, beginning on line 29),
clarify that the payments CIWMB is authorized to issue may
include "advanced payments."
REGISTERED SUPPORT / OPPOSITION :
Support
Californians Against Waste
Safety-Kleen Systems, Inc.
Sierra Club California
Opposition
Evergreen Oil, Inc.
Western States Petroleum Association
Analysis Prepared by : Elizabeth MacMillan / NAT. RES. / (916)
319-2092