BILL ANALYSIS �
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|SENATE RULES COMMITTEE | AB 1900|
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THIRD READING
Bill No: AB 1900
Author: Gatto (D), et al.
Amended: 8/24/12 in Senate
Vote: 21
SENATE ENERGY, UTIL. & COMMUNIC. COMM. : 11-0, 6/25/12
AYES: Padilla, Fuller, Berryhill, Corbett, De Le�n,
DeSaulnier, Emmerson, Kehoe, Pavley, Rubio, Wright
NO VOTE RECORDED: Simitian, Strickland
SENATE ENVIRONMENTAL QUALITY COMMITTEE : 7-0, 7/2/12
AYES: Simitian, Strickland, Blakeslee, Hancock, Kehoe,
Lowenthal, Pavley
SENATE APPROPRIATIONS COMMITTEE : 7-0, 8/16/12
AYES: Kehoe, Walters, Alquist, Dutton, Lieu, Price,
Steinberg
SENATE ENVIRONMENTAL QUALITY COMMITTEE : 6-0, 8/28/12
(pursuant to Senate Rule 29.10)
AYES: Simitian, Strickland, Blakeslee, Hancock, Kehoe,
Lowenthal
NO VOTE RECORDED: Pavley
ASSEMBLY FLOOR : 72-1, 5/31/12 - See last page for vote
SUBJECT : Renewable energy resources: biomethane
SOURCE : Author
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DIGEST : This bill requires the Office of Environmental
Health Hazard Assessment (OEHHA) to determine the maximum
concentration of constituents (COCs) of concern in
landfill gas and requires the Public Utilities Commission
(PUC) to develop testing protocols for the those COCs.
This bill also requires PUC to adopt nondiscriminatory
pipeline access rules and requires the State Energy
Resources Conservation and Development Commission (Energy
Commission) to identify impediments, to biomethane
electricity procurement, and prohibits a gas producer from
knowingly selling, transporting, or supplying gas from a
hazardous waste landfill.
Senate Floor Amendments of 8/24/12 extend the date by which
PUC must adopt regulations, remove contingent enactment
language and avoid chaptering out conflicts.
Senate Floor Amendments of 8/22/12 expand the scope of the
overhaul of landfill biogas health, safety and monitoring
standards currently in this bill to include biogas from
various sources, to be accomplished in a specified time
frame with input from the California Environmental
Protection Agency (CalEPA), and make other conforming and
clarifying changes.
ANALYSIS :
Existing law (Health and Safety Code Section 25420 et seq.)
sets requirements for vinyl chloride in landfill gas to be
sold, transported and supplied and specifies testing and
monitoring requirements for carcinogens and reproductive
toxins in landfill gas sold to gas corporation. Under the
Renewable Portfolio Standard (RPS) (Public Utilities Code
Section 399.11 et seq.), electricity generated from
landfill gas may count toward RPS requirements.
Existing law:
1. Requires the PUC to specify the maximum amount of vinyl
chloride that may be found in landfill gas.
2. Prohibits a gas producer from knowingly selling,
supplying, or transporting to a gas corporation, and a
gas corporation from knowingly purchasing, landfill gas
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containing vinyl chloride in a concentration exceeding
the maximum amount determined by the PUC.
3. Requires a person who produces, sells, supplies, or
releases landfill gas for sale offsite to a gas
corporation to sample and test, bimonthly, the gas at
the point of distribution for chemicals known to the
state to cause cancer or reproductive toxicity.
4. Requires the OEHHA to evaluate the environmental and
health risks posed by various hazardous substances.
The Warren-Alquist State Energy Resources Conservation and
Development Act establishes the Energy Commission and
requires it to prepare an integrated energy policy report
on or before November 1, 2003, and every two years
thereafter. The Act requires the report to contain an
overview of major energy trends and issues facing the
state, including, but not limited to, supply, demand,
pricing, reliability, efficiency, and impacts on public
health and safety, the economy, resources, and the
environment.
This bill:
1. Requires OEHHA, in consultation with the Air Resources
Board (ARB), Department of Toxic Substance Control
(DTSC), Department of Resources Recycling and Recovery
(DRRR) and CalEPA (a) to compile a list of COCs found in
biogas at concentrations significantly higher than
natural gas and that could pose a health risk; (b) OEHHA
to determine health protective levels for the list of
COCs and consider potential health impacts and risks to
utility workers and gas end users; (c) ARB to identify
realistic exposure scenarios, and health risks
associated with the exposure scenarios for the
identified COCs, in consultation with OEHHA; and (d)
ARB, in consultation with DTSC, DRRR, and CalEPA to
determine concentrations of COCs, and use the health
protective levels and exposure scenarios identified, and
to determine monitoring, testing, reporting and
recordkeeping requirements separately for each source of
biogas and that the above determinations be completed by
May 15, 2013, and updated at least every five years.
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This bill specifies that the actions taken by the CalEPA
agencies are not regulations and not subject to the
Administrative Procedures Act.
2. Requires PUC to do the following: (a) adopt standards
for the concentrations of COCs that may be found in
biomethane to ensure the protection of human health and
pipeline facility safety; (b) adopt the monitoring
testing and reporting and recordkeeping requirements
identified by ARB; and (c) adopt the above standards and
requirements by December 15, 2013, to be updated every
five years, or earlier if new information becomes
available. This bill requires PUC to require gas
corporation tariffs to condition access to common
carrier pipelines on the applicable customer meeting
specified standards and requirements.
3. Prohibits a person from injecting biogas into a common
carrier pipeline unless it satisfies specified standards
and prohibit a person from selling, transporting,
supplying or purchasing, and a gas corporation from
purchasing, biogas collected from a hazardous waste
landfill gas through a common carrier pipeline.
4. Defines terms including "biogas," "biomethane," "common
carrier pipeline," and "dedicated pipeline."
5. Requires the Energy Commission to hold public hearings
to identify impediments that limit procurement from
biomethane in California, including, but not limited to,
impediments to interconnection.
6. Requires the Energy Commission to offer solutions to
those impediments as part of the above-mentioned report.
7. Requires the PUC to adopt policies and programs that
promote the in-state production and distribution of
biomethane.
Background
Biomethane in California . Biomethane is a renewable fuel
that is produced at several types of facilities, including
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dairy farms and landfills. The gas can be collected and
then transported to a generation facility where it can be
used to make electricity. Transportation of biofuels via
truck or rail is not economically feasible. Transport via
pipeline is the preferred method. This energy release
allows biogas to be used as a fuel. The methane can also
be used onsite, such as at dairies, in anaerobic digesters
where it is typically used in a combustion engine to
convert the energy in the gas into electricity and heat.
As a result of state law, California's major gas
corporations, Sempra Utilities and Pacific Gas and Electric
(investor-owned utilities or IOUs), operate common carrier
pipelines but will not allow biomethane from landfills to
be injected into the pipelines they operate.
Landfill gas may have constituents present that could
adversely impact human health. Some constituents (e.g.
lead, arsenic, cadmium) could cause cancer or birth
defects. Since the delivery of the gas to a household
appliance could inadvertently provide close exposure to
these constituents, IOUs do not allow landfill or dairy gas
into their pipelines. IOUs are also concerned about
potential damage to the pipelines themselves, depending
upon what is in the gas - moisture, for example, could
cause corrosion.
The California Energy Commission (CEC) estimates that 358
megawatts (MW) is potentially available from new landfill
gas development. Of these landfills, some are small and
are therefore unlikely to be developed for gas by 2020.
Many are not near a gas transmission line. According to
the Assembly Natural Resources Committee, of 10 landfills
operated by Waste Management, four are sufficiently close
to a suitable pipeline with a sufficient volume of gas to
be considered for development for landfill gas. Waste
Management estimates around 150 MW of in-state gas that
could be developed in California for delivery to a
generation facility. There is also the potential to
produce electricity at a landfill if it were equipped with
a small generation facility (such as a fuel cell). As
electricity generators these facilities would count toward
a utility's requirements under the RPS. Owners and
developers of landfill gas facilities can also bid into the
utility RPS solicitations, the Reverse Auction
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solicitations, and the Feed in Tariff. Some landfills
currently have fuel cells or combustion turbines and use
the electricity generated on site.
IOU procurement . California's three largest electric
utilities all have contracts in their renewable portfolios
which use biomethane gas onsite at dairies and landfills to
generate electricity. San Diego Gas and Electric has 13
landfill gas projects totaling almost 40 MW and a few small
dairy digester gas projects. Southern California Edison
advises that it has 14 landfill and dairy contracts with a
total capacity of 139 MW. Pacific Gas and Electric reports
eight dairy contracts for 10 MW and 13 landfill gas
contracts with a total capacity of 62 MW. The statewide
total is 48 contracts for a total capacity of 252 MW.
2011 bioenergy action plan . A 2006 executive order set a
target of generating 20% of the state's renewable energy
from biopower (biomass to electricity) by 2010 and
maintaining this ratio through 2020. To achieve those
targets, the CEC developed an action plan in 2006 and
updated that plan last year with the "2011 Bioenergy Action
Plan." That plan summarized the barriers to deployment of
biomethane as:
California utilities do not have uniform biomethane
quality standards and the standards in place may not be
appropriate for biomethane, most standards were designed
for natural gas injection;
Current utility tariffs require project developers to
pay for the costs of the interconnection which is a
large cost barrier;
The commercially available conversion technologies,
such as anaerobic digestion, are generally limited to
high moisture (non-woody) feedstocks;
New technologies are in development, but have high
capital costs and other economic, regulatory, and
development barriers; and
Statute currently prohibits the injection of landfill
gas, despite allowing landfill gas from out-of-state to
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be scheduled into California; other states allow
landfill gas to be injected into their systems that
deliver gas into the California system.
Comments
According to the author's office, current statute sets
strict standards for the use of landfill gas in natural gas
pipelines in California and current regulations adopted by
the IOUs and later by the PUC ban landfill gas from
entering into common carrier pipelines completely. The
author's office notes that restrictions against landfill
gas rose out of fear in the 1980's that landfill gas
contained harmful amounts of vinyl chloride, a chemical
known to cause cancer, but recently the Gas Technologies
Institute has since shown that vinyl chloride is not
present in harmful levels, if at all, in landfill gas. The
author's office adds that these statutes and regulations
have stifled the growth of the biomethane industry in
California and other biomethane producers, such as
waste-water treatment facilities and dairy farms, and have
intimated that regulations surrounding biomethane have made
it impossible to compete with other state-subsidized
renewables, such as solar, in an attempt to develop a
diverse renewables portfolio for the state. According to
the author's office, this bill breaks down barriers to
transporting biomethane in-state by requiring the PUC to
develop new gas safety standards for nonhazardous landfill
gas and prohibiting IOUs from implementing anti-competitive
barriers to non-hazardous landfill gas once it has met
safety specifications and standards.
Related legislation . AB 2196 (Chesbro) clarifies the
definition of an eligible renewable electrical generation
facility to include a facility that generates electricity
utilizing biomethane delivered through a common carrier
pipeline if the source and delivery of the fuel can be
verified by the CEC.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: Yes
According to the Senate Appropriations Committee:
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$139,000 in 2012-13 and 2013-14 from the Public
Utilities Reimbursement Account to OEHHA for a health
and safety study of landfill gas.
$100,000 in 2012-13 and 2013-14 from the Energy
Resources Programs Account (General Fund) to the CEC for
hearings to identify impediments to interconnections and
to develop solutions.
$150,000 in 2012-13 and 2013-14 from the Public
Utilities Reimbursement Account to the PUC to set
standards for landfill gas, adopt testing protocols and
policies that promote in-state production and
distribution of biomethane, $120,000 annually thereafter
to monitor standards, protocols and, as necessary, pilot
projects.
SUPPORT : (Verified 8/29/12)
Biofuels Energy
Bloom Energy
California Association of Sanitation Agencies
California Municipal Utilities Association
California State Association of Electrical Workers
California State Council of Laborers
California State Pipe Trades Council
Californians Against Waste
CALSTART
Cambrian Energy
City of San Diego
Coalition for Renewable Natural Gas
Cornerstone Environmental Group
County of Nevada
County Sanitation Districts of Los Angeles County
First Southwest Company
Glendale Water and Power
Pasadena Water and Power
Regional Council of Rural Counties
Sacramento Municipal Utility District
SCS Energy
Sonoma County Water Agency
South Coast Air Quality Management District
Union of Concerned Scientists
Waste Management
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ASSEMBLY FLOOR : 72-1, 5/31/12
AYES: Achadjian, Alejo, Allen, Ammiano, Atkins, Beall,
Bill Berryhill, Block, Blumenfield, Bonilla, Bradford,
Brownley, Buchanan, Butler, Campos, Carter, Chesbro,
Conway, Cook, Davis, Dickinson, Donnelly, Eng, Feuer,
Fong, Fuentes, Furutani, Beth Gaines, Galgiani, Garrick,
Gatto, Gordon, Gorell, Grove, Halderman, Hall, Harkey,
Hayashi, Roger Hern�ndez, Hill, Huber, Hueso, Huffman,
Jeffries, Jones, Knight, Lara, Logue, Bonnie Lowenthal,
Ma, Miller, Mitchell, Monning, Morrell, Nestande,
Nielsen, Olsen, Pan, Perea, V. Manuel P�rez, Portantino,
Silva, Skinner, Smyth, Solorio, Swanson, Torres, Wagner,
Wieckowski, Williams, Yamada, John A. P�rez
NOES: Hagman
NO VOTE RECORDED: Charles Calderon, Cedillo, Fletcher,
Mansoor, Mendoza, Norby, Valadao
RM:k 8/30/12 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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