CITY AND COUNTY OF SAN FRANCISCO

BIODIESEL ACCESS TASK FORCE

 

REGULAR MEETING

 

APPROVED MINUTES

 

THURSDAY, JULY 20, 2006, 10:00 A.M.

 

CITY HALL, ROOM 278

ONE DR. CARLTON B. GOODLETT PLACE

SAN FRANCISCO, CA 94102

 

*The Thursday, July 20, 2006 Regular Meeting was held in Room 278 and not in Room 408, City Hall.

 

TASK FORCE MEMBERS:  VOTING:  Eric Bowen (Chair), Adam Hagen (Vice-Chair), Melissa Hardy, Benjamin Jordan, Karri Ving. NON-VOTING: David Augustine (Treasurer/Tax Collector), Richard Berman (Port), Sarah Dennis (Planning Department), Kevin Drew (Department of the Environment), Mike Ferry (Fire Department), Tom Franza (SFPUC), Laurence Kornfield (DBI), Jennifer Matz (MOCD), Marty Mellera (MTA).

 

TASK FORCE SECRETARY:  Monica Fish

 

ORDER OF BUSINESS

 

1.      CALL TO ORDER AND ROLL CALL

 

The meeting was called to order at 10:08 a.m.  Present: Members Berman, Bowen, Hardy , Jordan, Ving (10:15), Dennis, Drew, Franza, and Matz.  Absent:  Members Hagen, Augustine, Ferry, Kornfield, and Mellera.  Vacant:  Member representing the Department of Public Health.

 

2.      ACTION:  Approval of the June 13, 2006 Special Rescheduled Meeting Draft Minutes.  Upon Motion by Member Jordan and second by Chair Bowen, the June 13, 2006 Special Meeting Minutes were approved with no objection (Absent:  Members Hagen and Ving).  (Explanatory Document: June 13, 2006 Approved Minutes).

 

Item 5 was heard before Items 3-4.

 

3.      INFORMATIONAL PRESENTATION and DISCUSSION:  Informational presentation of the mechanics and economics of converting an existing gas station diesel tank and pump to biodiesel.

SPEAKER:  Rob Elam, Propel Fuels

 

Chair Bowen introduced Mr. Rob Elam of Propel Fuels in Seattle who works with biodiesel quality issues and has direct experience selling biodiesel in the retail environment in the Seattle area.  Mr. Rob Elam discussed Seattle and Puget Sound’s progress in the use of biodiesel in comparison to San Francisco.  It was indicated that passenger vehicles can be purchased in the area which creates a greater public demand.  Puget Sound’s larger fleets such as King County Metro, which is their bus transit in Seattle, Tacoma, and Olympia, have had experience with the B5 and B20 biodiesel program in the last two years with varying degrees of success.  Propel Fuels pioneered the permitting process in the region and manages three stations in the Seattle area, two retrofit and one new construction.

 

Mr. Elam gave a presentation on public biodiesel pump installations and best practices.  Topics included:

 

§         Steps for Building Publicly Available Biodiesel Pumps.

§         Foundations for a Successful Project—committed project owners; public private partnerships, existing stations or new businesses; understanding challenges; establishing a realistic budget; and commitment to ongoing customer education.

§         Importance of Location--three projects in Puget Sound are in existing diesel fueling locations.  Users switched to biodiesel from petroleum diesel based on price and emotional reasons.

§         Product Enhancement Methods—developing products to meet or beat petroleum and development of user interfaces.

§         Permits and Partners—education, choosing experienced construction partners, building trust, and following rules.

§         Tanks and Dispensing Equipment—sizing, converting tanks, material and handling, cleaning methods and resolving problems, inspection, spill containment, and above or below ground pump location considerations.

§         Assuring Quality Fuel Supply—BQ9000 or equivalent, choosing distribution partners.

§         Utilizing local, state, and federal Incentives—Form 8911, Alternative Fuel Vehicle Refueling Property Credit and keeping apprised of evolving legislation.

 

Public speakers were not identified.

 

Public Comment:  Speaker requested more elaboration on tank cleaning problems.  Mr. Elam indicated that (1) particularly in underground tanks, there usually is a problem in getting all the material out; (2) the location of the opening is important in being able to flush all the material out, and (3) discussed the importance of a final inspection. 

 

Public Comment:  An inquiry was made regarding biodiesel tank cleaning expenses.  Mr. Elam stated that cleaning can be anywhere from $2,000 to $5,000.  It was stated that biodiesel tanks require additional cleaning steps in comparison to conventional cleaning methods for diesel tanks.

 

Public Comment:  An inquiry was made regarding the quality of the cleaning and inspection of tanks.  Mr. Elam recommended that someone be there during cleaning and inspection and that the final inspection be documented on a sign-off sheet.

 

Public Comment:  It was indicated that older tanks that have switched to biodiesel may have contained various fuels and would require additional cleaning.

 

Public Comment:  An inquiry was made as to whether quality could be judged visually after a tank had been filled.  Mr. Elam stated that visual quality judgments were difficult because the small openings make it too dark to see.

 

Public Comment:  An inquiry was made regarding the success of blended fuel polishing.  Mr. Elam stated that he does not have information on fuel polishing for blended fuel.

 

Mr. Elam discussed his experience in recruiting gas station owners and discussed major business hurdles that would prevent station owners from offering alternative fuels.  Examples discussed included station owners being locked into traditional fuel supply contracts that do not allow them to receive fuel from another provider, the fear of the unknown, and pricing issues.  It was stated that station owners that are offering biodiesel have been happy with their choice, have had a high profit margin, and are selling more than anticipated.  Mr. Elam discussed the importance of locating biodiesel fuel-pumps as close to existing petroleum diesel pumps as possible.

 

Public Comment:  An inquiry was made as to whether independent station owners would be more successful in offering biodiesel as chains are not eligible to offer the product contractually.  Mr. Elam stated that independent station owners had the most flexibility.

 

Member Dennis indicated that she would research the availability of a list of all gas station owners in order to determine independent owners.

 

Public Comment:  An inquiry was made as to whether there was a City-approved contract vendor that is being used to polish tanks.  Another public speaker stated that there is a public contractor in Berkeley that is beginning to work with the City.

 

Mr. Elam explained Propel Fuel’s role as a consultant supplying the expertise and process to make sure it all works.  It was stated that Propel Fuel works with the distribution partner, supplies the education component, addresses the hurdles by offering different kinds of products and lessening the up-front costs for station owners.

 

4.      DISCUSSION:  Biodiesel Access Task Force meeting room—discussion of City Hall availability and suitability of meeting rooms for meetings. 

 

Task Force members recommended that meetings continue in Room 278 instead of Room 408.  The Task Force Secretary indicated that a Bylaws change notice and Resolution would be prepared for the next meeting in order to change the regular meeting room to 278.

 

5.      INFORMATIONAL REPORT and DISCUSSION:  Report on the permitting process by regular gas stations and other agencies.

SPEAKERS:  Members Sarah Dennis and Benjamin Jordan

 

Member Jordan circulated a “Traditional Fuel Dispensing and Storage Site Permitting Summary” and reported on the lead municipal agencies that conduct how permitting requirements and regulations are conducted for new fueling stations dispensing diesel, gasoline and other petroleum products.  It was stated that the requirements for traditional fuel dispensing serve as a baseline for determining neat and blended biodiesel requirements.  A “Biodiesel Dispensing and Storage Site Permitting Summary” that shows potential permitting scenarios for biodiesel and vegetable based fuels was also circulated and discussed.

 

Member Dennis circulated a memorandum on the “Permitting Process Current Requirements for Regular Gas Stations” and discussed the process and agencies involved in the permitting of gas stations.

 

Chair Bowen stated that he believed that the Bay Area Air Quality Management District does not regulate diesel based on its vapor characteristics and requested a report on whether the Bay Area Air Quality Management District would regulate biodiesel based on its similar characteristics of diesel.

 

Member Hardy asked if a spill plan permit for fueling stations exists.  Member Dennis reported that the Health Department calls it a “Spill Control and Counter Measures Plan” and would present a report at a future meeting.   It was recommended that exemptions and thresholds for biodiesel should be checked.

 

Public Comment:  Speaker stated that all departments listed in the “Traditional Fuel Dispensing and Storage Site Permitting Summary” were City departments except for the Agriculture and Weights and Measures Program.  Member Jordan stated that there is a local department run by the local Health Department that goes to establishments to check meters. 

 

6.      DISCUSSION:  Incentives and benefits for new and existing fuel stations to convert diesel tanks to biodiesel.

SPEAKER:  Member Karri Ving

 

Member Ving discussed reducing the capital investment for new and existing stations by having the distributor subsidize the stations and taking on the liability if the fuel did not sell.   

 

Chair Bowen recommended that Member Ving contact local distributors to determine their response to the concept.

 

Public Comment:  Speaker recommended doing a web search for a national list of independent station-owners.

 

Chair Bowen discussed an upcoming report that will be given by Member Augustine at the next meeting on the fiscal impact of eliminating the payroll tax and other fees as an incentive for gas station owners to switch over, and if feasible, to recommend to the Board of Supervisors.  Member Matz recommended streamlining the permitting process for new stations, but advised against utilizing sales tax incentives.

 

7.      INFORMATION:  New Business. 

 

The Task Force discussed inviting the Golden Gate Restaurant Association to participate in future Task Force meetings.

 

8.      DISCUSSION:  Future Agenda Items.  August 17 meeting:  (1) report on the potential fiscal impact of payroll tax exemptions for gas stations to switch over to biodiesel; (2) Members Jordan and Dennis would provide a list of station owners and a handbook on the City permitting process.

 

9.      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. Peter Govorchin inquired as to the legality of running a car on vegetable oil and described the Pacific Bus Museum that houses 21 historic coaches.  Mr. Govorchin suggested that the vehicles would be ideal for exhibiting biodiesel in San Francisco, but would require funding to showcase.  Website: www.pacbus.org.  

 

Mr. Jeffrey Singer inquired as to the availability of a map of existing diesel selling stations.  It was indicated that the Task Force would work on creating a map in the future.  Mr. Elam recommended a web search.

 

10.  ADJOURNMENT.  The meeting of the Biodiesel Access Task Force adjourned at 11:40 a.m.