CITY AND COUNTY OF SAN FRANCISCO
BIODIESEL ACCESS TASK FORCE REGULAR MEETING
TUESDAY, AUGUST 3, 2010, 10:00 A.M.
CITY HALL, ROOM 278, ONE DR. CARLTON B. GOODLETT PLACE
SAN FRANCISCO, CA 94102
TASK FORCE MEMBERS: VOTING: Eric Bowen (Chair), Eric Smith (Vice-Chair), Joe Burgard, Kevin Clark, Shannon Devine, Benjamin Jordan, and Michele Swiggers. Advisory: David Augustine (Treasurer/Tax Collector), Vandana Bali (Department of the Environment), Richard Berman (Port), Sarah Dennis (Planning Department), Mike Ferry (Fire Department), Laurence Kornfield (DBI), Vacant (MOCD), Marty Mellera (MTA), Virginia St. Jean (DPH), Karri Ving (PUC).
ORDER OF BUSINESS
1. Call to Order and Roll Call. The Biodiesel Access Task Force meeting convened at 10:08 a.m. Present: Chair Bowen, Vice-Chair Smith, Members Clark and Devine; Excused: Members Burgard and Jordan; Advisory Members Present: Members Berman and Ving; Advisory Members Excused: Members Augustine, Bali, Dennis, Ferry, Kornfield, Mellera and St. Jean. Ms. Fish announced that Ms. Swiggers had resigned from the Task Force.
2. Approval of the April 6, 2010 Biodiesel Access Task Force Regular Meeting Draft Minutes. (Explanatory Document: April 6, 2010 Draft and Approved Minutes) (Discussion and Action) Upon Motion by Chair Bowen, second by Vice Chair Smith, the April 6, 2010 Meeting Minutes were approved without objection (AYES: Chair Bowen, Vice-Chair Smith, Members Clark and Devine; Absent: Members Burgard and Jordan).
3. Public Comments: Members of the public may address the Task Force on matters that are within the Task Force’s jurisdiction and are not on today’s agenda. There was no public comment at this time.
4. City Biodiesel Pilot Program discussion on the acceptance of biodiesel and biodiesel blends across the city to ensure all fleets are capable to run the Mayors minimum mandate and have sufficient support in determining higher blend pilot programs. (Continued Discussion from the April 6, 2010 Meeting) (Discussion) SPONSOR: Member Jordan; SPEAKER: Chair Bowen
Chair Bowen reported that this agenda item is to check on the City’s current biodiesel use and identify who might be interested in exploring higher blends. The goal is to get everyone on B20 and explore where appropriate higher blends B50, B80 and B100 may be applied. He inquired whether Member Bali has reconvened the City’s biodiesel fleet user’s group. Vice Chair Smith stated that Member Bali has less time and funding available to work on the biodiesel program, but that he and Member Jordan have a tentative meeting scheduled with Ms. Johanna Partin of the Mayor’s Office to discuss these topics and more moving forward. Chair Bowen stated that because of the lapse in the biodiesel tax credit, a lot of biodiesel users dropped to B5. Vice-Chair Smith reported that Member Mellera has moved into a planning role with MUNI and does not have someone hired yet to fill the gap, but would provide updates to the Task Force as soon as possible.
Member Ving reported that she had met last week with Western States, the City’s biodiesel provider, to identify what the City is currently consuming because PUC plans to sell biodiesel blends in small quantities. She reported that MUNI, with the exception of a couple of yards, and Central Shops are currently using B20. The Fire Department is interested in B1, so Western States is accommodating them by splash blending B5. Without a point person driving biodiesel forward at the Fire Department, it is the prerogative of the fleet manager. Since PUC is all under the Central Shops fleet, it is the General Manager’s intention to honor B20, and there is interest in higher blends and a pilot B100 program. She reported that Western States stated that the current master contract is being extended, but does not know whether it will be for one or four years. Western States offered to retrofit MUNI tanks at their expense so that the tanks would be in compliance with higher biodiesel blends, but City decision makers have not yet accepted the offer.
This agenda item was continued to the October 5, 2010 meeting for a discussion of next steps.
5. Update on the Greasecycle Program and San Francisco Public Utilities Commission (SFPUC) Pilot Plant. (Continued Discussion from the April 6, 2010 Meeting) (Informational Report and Discussion) SPEAKER: Member Ving
Member Ving reported that San Francisco’s Greasecycle program is still continuing to provide a significant service. SFPUC did a policy comparison on continuing the program as it is or considering other alternatives to accomplish the same goal, which is to make sure smaller restaurants are in compliance. The two policy alternatives were to issue fines to restaurants or to establish a citywide franchise agreement where the collection of the cooking oil from the big hotels would subsidize the smaller restaurants. Both alternatives require a significant increase in staffing, inspectors, and City-planning staff and are not popular with the restaurant community. They do not want to be told that they will be fined or that they have to sell their oil.
Member Ving reported that the brown grease to biodiesel program is in a research and development phase, and that SFPUC has begun generating small quantities of ASTM biodiesel. She discussed current plans, setbacks, and challenges. Member Ving reported on current negotiations with NASA to do a pilot project to harvest algae that would be used for various biofuels. She discussed NASA’s Offshore Membrane Enclosures for Growing Algae (OMEGA) program.
Member Devine discussed the possibility of the SFPUC setting up partnerships with a small local biodiesel producer. Member Ving stated that the City does not set up partnerships and does not know how joint ventures work. Member Berman inquired whether the SFPUC is seeing a decrease in sewer clogs as a result of the Greasecycle programs. Member Ving reported that improvements would only be seen after a significant amount of time because it would take time to repair and clean the lines.
Public Comment: Mr. Wesley Caddell stated that there are three wastewater treatments plants that use algae for activating sludge and to treat their waste and was encouraged to hear about NASA’s project.
6. Update on the Status of Darling’s Proposed Biodiesel Manufacturing Plant in San Francisco. (Continued Discussion from the April 6, 2010 Meeting) (Informational Report and Discussion) SPEAKER: Vice-Chair Smith
Vice Chair Smith reported that he recently received an Addendum to the Supplemental Environmental Impact Report for the Darling Facility http://www.sf-planning.org/ftp/files/MEA/2008.1052E_Pier_92_EIR_Adm.pdf. He stated that the EIR is thorough and comprehensive, and conclusions reflect that there is nothing major that Darling needed to do. Member Berman reported that the report issued was an addendum to the San Francisco Southern Waterfront Final Supplemental EIR and found that there were no significant impacts. He stated that the original CEQA analysis resulted in a categorical exemption, which was legally challenged. The EIR was rescinded and submitted for the analysis. It is likely that Port staff would issue a lease amendment request that would be reviewed at a Port Commission hearing in the next few months, possibly October. If the lease amendment is approved and there are no further legal challenges, then all that is needed is permission for Darling to produce biodiesel. Darling would not be obligated to do so, but may be obliged to implement recommendations.
Vice Chair Smith reported that he had spoken to earlier opponents of the project who read the EIR and were pleased with its thoroughness and were comfortable with it moving forward. They felt that recommendations by the Port and others to deal with odor issues were satisfied with this process and gave credit to the Port for bringing the process to where it currently is.
7. Legislative update on the Biodiesel Fuel Tax Credit and discussion on Industry Impact. (Continued Discussion from the April 6, 2010 Meeting) (Informational Report and Discussion) Sponsor: Member Jordan; Speaker: Chair Bowen
Chair Bowen reported that a biodiesel tax credit has not yet been approved. He stated that the credit always passes the House and has bipartisan support, but always needs to be attached to something else. He explained that it is nearly impossible to get anything through the Senate at this time because of a shortage of funding. Member Ving inquired whether the credit would be approved in 2011, but would not be retroactive. Chair Bowen stated that would be a possibility as well as other possibilities. He stated that there is a mandate to implement biodiesel, but the subsidies are not there to implement the mandate. He explained that the industry would like to get away from the blender’s one dollar tax credit and move it into a domestic biodiesel production credit. There are advocates in Congress but it is a larger effort which involves creating a new program as a producer’s credit versus an extension of the existing credit and would require a substantial increase in legislation text. There would be an additional attempt to push the existing tax credit forward before the end of the year.
Chair Bowen reported that the ethanol tax credit may have an impact on the biodiesel credit because it also expires this year and both credits are modeled the same way. It may be that the biofuel credits gets restructured. He stated that it makes it difficult for biodiesel distributors, producers and users because of the uncertainty for the past seven months that is resulting in a less than healthy market.
Public Comment: Mr. Caddell inquired whether the lapse in the tax credit has affected the City’s Master Fuel Contract and the City’s procurement with Western States. Mr. Dave Williamson, Western States reported that Western States has bought a significant amount of biodiesel so is safe for the time being. He stated that some suppliers are seeing their inventory depleted. He explained that the Renewable Identification Number (RIN) values may substitute the value of the subsidy. If the credit does not pass, the City’s supply is still safe, but would not be good for Western States. Chair Bowen inquired how much longer Western States would be able to satisfy the City’s biodiesel needs based on the current volume that was pre purchased. Mr. Williamson stated that he would provide a report back on Chair Bowen’s question after he receives additional information. He explained that their supplier recently met with the owner of Western States. He was assured that there would not be a severe price disruption, but would provide Member Ving with the current status.
8. Master Fuel Contract and City Biodiesel Program Update. (Continued Discussion from the April 6, 2010 Meeting) (Discussion) SPEAKER: Vice Chair Smith
Vice Chair Smith reported that Member Mellera is looking for someone to help with the Master Fuel Contract because of his change in assignment, but that he is positive about what is going on and wants to make sure that the City has a good supply of fuel. Member Ving reported that the City is discussing an extension of the fuel contract from one to four years.
Public Comment: Mr. Williamson reported that the City has asked for concessions that were provided, but explained that the funds received through the sale of fuel are mostly provided to suppliers. He stated that City staff liked their proposal, but that there had been a change in Purchasing Department staff that may have resulted in delays. He has had no response to extending the contract from one year to two, three or four years at this time, but is certain it would be for one year.
9. State Water Resources Control Board Underground Storage Tank (UST) Update. (Continued Discussion from the April 6, 2010 Meeting) (Informational Report and Discussion) SPEAKER: Chair Bowen
Chair Bowen reported that various tank owners find that there are not available underground tank certifications for biodiesel use and have to work with their local CUPA’s on what to do. The point person at the California Biodiesel Alliance is interfacing with equipment manufacturers, the State Resource Water Control Board, and the National Biodiesel Board on this issue but efforts are under-resourced for the size of the issue. There are a significant number of underground storage tanks across the state that contains biodiesel, and there are not enough resources at the local, state, and federal level to deal with the issue. The situation is better than before when there was no variance program, and everyone was told to pull biodiesel out of their tanks even if there was no risk and the tank was biodiesel compatible. The current status is not perfect, but tank owners and the industry are muddling through as best as they can with limited resources.
Public Comment: Mr. Williamson stated that there are potential simple fixes available that will substantially increase the amount of B20 being used by the MUNI bus fleet. He explained that he is the tank point person for Western States and has been working with MUNI staff to implement fixes to update their system.
10. Update on the Local Biofuels Permit Work Group. (Continued Discussion from the April 6, 2010 Meeting) (Discussion) SPEAKER: Member Jordan. This agenda item was continued to the October 5, 2010 meeting.
11. Status update on correspondence to engine manufacturers that educates them that the technology that they are using may have unintended impacts such as non-compatibility with current fuels used in municipal fleets, state mandates and others. (Continued Discussion from the April 6, 2010 Meeting) SPEAKER: Member Ving (Discussion and Possible Action)
Member Ving reported that she was considering purchasing an Isuzu truck for SFPUC that uses a different technology to handle particulates and does not have the compatibility issues, but the distributor went out of business. She does not know that the City has an approved vendor to buy the product from at this time.
Public Comment: Mr. Caddell stated that the City should have a plan for a new or secondary vendor. Member Ving discussed the difficulty in becoming a City-approved vendor and discussed the possibility of waivers if a City approved vendor cannot be found.
This agenda item was continued to the October 5, 2010 meeting.
12. Green Depot Program Report. (Continued Discussion from the April 6, 2010 Meeting) (Informational Report and Discussion) SPEAKER: Vice-Chair Smith
Vice Chair Smith reported that Green Depot continues to do many green jobs forums with Mr. Caddell who represents Biofuel Recycling. He announced that Green Depot grant funding is coming to a close, and Green Depot’s focus and purpose has been changing. There has been discussion about Green Depot and Biofuels Recycling merging. Vice Chair Smith stated that he and Members Ving and Caddell would be visiting San Quentin to discuss programs with the re-entry population. In addition, he and Mr. Caddell are holding educational community meetings partnering with Clean Cities and the Conservation Corp predominantly in District 10 where funding is directed. Work would continue with Global Exchange and others on green jobs activities, providing literature to the produce mart, providing assistance with outreach, volunteer eco-tours of the different biodiesel facilities, and disseminating information on jobs available.
Vice Chair Smith discussed the new ownership of Dogpatch Biofuels and his participation in several events, which Dogpatch has been involved with. He stated that Girls Inc. from Oakland participated in a recent event and were educated on biofuel and the important part that women have played in biodiesel. He discussed other biodiesel-related enterprises that are currently in progress such as biodiesel lighter fluid for barbecues. He reported that due to the price of oil and the gulf spill, Dogpatch Biofuels has seen its business quadruple in that month. People are refusing to use petroleum because of what happened in the gulf. He announced that Green Depot and Biofuels Recycling along with Mr. Darian Rodriguez Heyman convened a community meeting with folks from Nevada City and Grass Valley that were interested in the City’s Greasecycle and biofuel programs.
13. Dogpatch Biofuels Update. (Continued Discussion from the April 6, 2010 Meeting) (Informational Report and Discussion) SPEAKER: Vice-Chair Smith. This agenda item was heard during Agenda Item 12.
14. Fat Free Biofuel LLC Refinery Update. (Continued Discussion from the April 6, 2010 Meeting) (Informational Report and Discussion) SPEAKER: Member Devine
Member Devine reported that there is a lack of funding for her venture and hopes that someone will see the advantage of her permits and location and utilize the facility for community-based recycling or a public or private small biofuel refinery. Vice-Chair Smith inquired about the location of the property. Member Devine reported that the property is located down the street from Lowe’s in the Bayshore district. She explained that she selected this property because Lowe’s is committed to biodiesel. Member Devine stated that she has all her Planning approvals and EIR exemption and can acquire building approvals quickly. She has permit approvals for blending, storing 40,000 gallons of any kind of oil in tanks, and a refinery which can produce 40,000 gallons. Vice Chair Smith discussed all the challenges surrounding biodiesel in the current climate and encouraged Ms. Devine to look at other ways to utilize the property.
15. New Business/Future Agenda Items. (Information and Discussion) Chair Bowen reported that the Task Force is set to sunset at the end of this year, and requested that a discussion be held at the next meeting on how to wrap up the Task Force work or whether to issue a request to the Board of Supervisors for a conditional extension. Vice Chair Smith suggested requesting a change in venue to a Biofuel Task Force that would look at all alternative methods of transportation. Chair Bowen requested a discussion on the proposed scope of work and creating a report on work that has been accomplished by the Task Force to date that would include all of the environmental and green house gas benefits that have been achieved through this program. Vice Chair Smith suggested a discussion on the challenges for the biodiesel industry and the future of the Task Force. Member Ving suggested that the report be structured as an update to the initial report so that it is one report that captures four years of hard work and describes the current state of the industry. Member Berman suggested that the report data be consistent with the City’s Climate Action Plan.
Member Clark stated that biodiesel vehicles should be included in electric vehicle events promoted at city events. He suggested that there be equal time for biodiesel where electric vehicles appear. Vice-Chair Smith explained that City vehicles are mostly CNG or Prius’s, and there are not that many passenger vehicles that are City owned that run on biodiesel. It was explained that biodiesel is looked at as a workhorse fleet, but not as a fuel for other cars.
Public Comment: Mr. Caddell stated that he brings vehicles to events as a volunteer effort and asked to be kept apprised of events. Chair Bowen suggested reaching out to the Department and others to make sure the Task Force is included in event invitations so there are publicity opportunities.
16. Public Comments: Members of the public may address the Task Force on matters that are within the Task Force’s jurisdiction and are not on today’s agenda.
Mr. Williamson reported that there was a Berkeley Biodiesel car show that attracted a lot of people including many policy makers. He suggested that people start thinking about higher blends of biodiesel in lawn mowers and other low volume engines. Mr. Williamson stated that biodiesel is the most cost-effective alternative fuel and has less impact. A discussion was held about the feasibility of biodiesel use in school buses instead of diesel and offering this alternative in the renewal of the contract.
17. Adjournment. The Biodiesel Access Task Force meeting adjourned at 11:45 a.m.
The next meeting of the Biodiesel Access Task Force is scheduled for Tuesday, October 5, 2010, in City Hall, Room 278.
Respectfully submitted by,
Monica Fish, Task Force Secretary
**Copies of explanatory documents are available at (1) the Biodiesel Access Task Force Office, 11 Grove Street, San Francisco, California between the hours of 9 a.m. and 5 p.m., (2) upon request to the Task Force Secretary, at telephone number 415-355-3709 or via e-mail at Monica.Fish@sfgov.org, or (3) on the website with each agenda or meeting minutes at https://sites.google.com/a/sfenvironment.org/commission/biodiesel-access-task-force.
*Approved: October 5, 2010