CITY AND COUNTY OF SAN FRANCISCO
BIODIESEL ACCESS TASK FORCE REGULAR MEETING
WEDNESDAY, OCTOBER 8, 2008, 10:00 A.M.
CITY HALL, ROOM 278, ONE DR. CARLTON B. GOODLETT PLACE,
SAN FRANCISCO, CA 94102
TASK FORCE MEMBERS: VOTING: Eric Bowen, Joe Burgard, Kevin Clark, Benjamin Jordan, Eric Smith and Michele Swiggers (One Vacant). NON-VOTING: 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 10:10 a.m. Present Voting: Chair Bowen, Members Burgard, Clark (10:15), Jordan, Smith and Swiggers. Non-Voting Present: Member Bali, Berman, and Ving (10:25). Non-Voting Excused: Members Augustine, Kornfield and St. Jean. Absent: Members Dennis, Ferry, and Mellera.
2. Approval of the August 13, 2008 Biodiesel Access Task Force Special Meeting Draft Minutes. (Discussion and Action) Upon Motion by Member Burgard and second by Member Jordan, without objection the Meeting minutes were approved as written (Explanatory Document: August 13, 2008 Approved Minutes).
3. Status of Dogpatch Biofuels Plans submitted to City and County Offices. (Continued Discussion from the August 13, 2008 Meeting) (Discussion) Speaker: Member Swiggers.
Member Swiggers reported that Dogpatch Biofuels is scheduled to receive their tank and dispensers next week that should be installed by the following week, and then be open for business mid-November, if all goes as planned. Permits have already been granted a few months ago.
4. Letter of Commendation to Dogpatch Biofuels on their success in starting a new Biodiesel Fueling Station in San Francisco. (Explanatory Document: Draft Commendation Letter) (Discussion and Action).
Chair Bowen distributed a Draft Commendation Letter for review and recommended that the letter be issued once the station is officially open for business. Member Smith read the commendation letter. Upon Motion by Member Smith and second by Member Jordan, without objection, the commendation letter was approved for issuance once Dogpatch Fuels is open for business.
5. Proposal to Create a B20 Mandate in San Francisco. (Discussion) Chair Bowen reported that the Task Force as one of their goals has been discussing whether to recommend a B5 or other mandate for all diesel sold within City limits. It was explained that Supervisor McGoldrick had been supportive of the idea and requested additional information, but the idea would have to be presented to additional Supervisors since Supervisor McGoldrick’s term limit would be reached this year. Member Smith reported that he had presented the idea to Supervisor Mirkarimi who seemed to be supportive and Member Smith would be scheduling a formal meeting with the Supervisor in the future. Member Ving reported that she had brought the idea to the Mayor’s attention so that the initiative could be sponsored by both the Mayor and Board of Supervisors, and that the feedback had been supportive.
Chair Bowen reported that the current B20 mandate being explored contains an acknowledgement that recommending this blend is premature because of underground storage tank, high biodiesel pricing, and engine warranty manufacturing issues. The implementation date for the B20 mandate would be a date uncertain, and it would be stated that a B5 mandate is implementable and should be started right away. The B20 mandate would be phased in and implemented as soon as it is deemed that tanks, infrastructure, and vehicles were sufficiently compatible to make that a realistic change, which may be a couple of years in the future. In addition, the B20 mandate would be effective based on when there is x amount of biodiesel available in the marketplace. Chair Bowen reported that the Mayor’s Office is researching additional information for the mandate and would be reporting back. An announcement would be made before the National Biodiesel Board conference, and there would be a 6-12 month timeframe before initial implementation. Member Smith reported that Mayor’s Office representatives would also be reaching out to Portland on methods they used to implement their mandate.
Member Bali inquired whether there would be any investments or up front cost concerns for retail station owners. Chair Bowen reported that there should not be in switching to B5, but there would be a concern on how to supply the B5 to the stations. Work would have to be done with the distribution companies to make sure that everything is in place for successful implementation.
6. Master Fuel Contract. Recommendation to the Office of Contract Administration that the City adopts a definition for fuel sustainability and includes sustainable fuel sources in their Master Fuel Contract. (Discussion)
Chair Bowen reported that Member Smith and he met with Mr. Wade Crowfoot of the Mayor’s Office to discuss the Master Fuel Contract. It was explained that coordination has to be in place between the Task Force as to the correct definition of sustainability and the Mayor’s Office sustainable biofuels policy in order to determine how to incorporate these considerations into the contractual language for the bids going out in a couple of months. Chair Bowen reported that the timeframe is short, and that there are many parties to coordinate with, which tends to cause difficulties. Member Bali reported that now is a good time to present the draft that had been created earlier for this purpose.
Member Jordan asked if there would be a way to implement the Master Fuel Contract so that the distribution company would be required to provide sufficient information on the sustainability and environmental impact of their biodiesel and on whether their costs are competitive. Chair Bowen explained that it would be a challenge since the City does not have enough resources to police the contract. Chair Bowen stated that Member Mellera has tried above and beyond the call of duty to make sure that MUNI is receiving quality fuel and that their contract is being honored. It was suggested that the petroleum company could be asked to submit a quarterly report to the Department of the Environment so that there could be an estimation of the true sustainability of the fuel. Chair Bowen explained that the United Kingdom (UK) model requires all petroleum refineries and importers to report on the life cycle impacts and feedstock origins of their biofuel and could be used as a model.
Chair Bowen recommended incorporating the City’s environmental principles into the contract and asking bidders to respond in the bid process on what they would propose in order to solve the City’s sustainability objectives. Member Jordan recommended creating a list of questions to ask producers in order to assess the footprint, e.g., cost, recovery, distance traveled, etc.
Member Jordan asked if the City would be asked to develop the capacity internally to implement quality assurance, control and sustainability. Member Bali stated that she would be restarting the monthly biodiesel meetings the 3rd week of this month to discuss issues surrounding underground storage tanks, the master fuel contract, biodiesel content, waste grease collection, and production facilities. Member Jordan stated that there needs to be a mechanism in place for writing the contract in sufficient enough time and a plan should be in place. Member Bali recommended setting up a meeting with Member Mellera who is working on this effort. Chair Bowen explained that Member Mellera had reported that for MUNI quality, pricing affordability, and reliability would be equally important to sustainability.
Member Burgard suggested that in order to give the local producers (whether they are able to offer biodiesel at the time the contract is signed or at sometime in the future) an opportunity to compete for at least a portion of the biodiesel being supplied to San Francisco that a stipulation be added to the contract that the fuel supplier would have to source some percentage of their biodiesel (randomly suggested 10%) from local, sustainable sources (both local and sustainable would have to be defined). The stipulation could hold that the supplier would not be obligated to that stipulation if the local, sustainable biodiesel was not available for a price within some margin above the national biodiesel standard price. An example of the concept would be: that the fuel supplier may source sustainable biodiesel from the producer of their choice. However, ten percent of the sustainable biodiesel per year will be sourced from the local market (the local market being that produced within the following geographic region –defined by zip codes for instance). The supplier will be relieved of this ten percent local supply requirement if local, sustainable biodiesel cannot be sourced for less than $.XX over the term for the standard rack price. This would assume that there is existing quality standards that apply to all biodiesel supplied.
Member Ving stated that it should be the role of the Task Force to open up the pathway for small biodiesel manufacturers and concurred with Member Burgard’s suggestion. Member Smith recommended adding a component similar to the Navy’s where the contractor has to get a certain amount of local participants to work based on three zip codes and if people in those zip codes meet the criteria, they are selected. If not, they are allowed to go outside those zip codes. Chair Bowen explained that the fuel contract is structured with one contractor and they buy the fuel. The suppliers of the fuel aren’t conceptualized as sub contractors so there is not a framework in place to say the suppliers of the fuel must come from certain areas of the city. Chair Bowen stated that maybe the contract should be restructured to add all those standard City subcontractor preferential components. Member Ving explained that there are very few approved City vendors, and the more stipulations put in the contract, the tougher it will be. Member Jordan recommended reformulating the contract in order to increase the number of people able to sell to the City and to allow a management company to bid, so it can manage several different distribution companies. Member Bali reported that Member Mellera is leading the effort for renegotiating and rewriting the contracts and would report back after consulting with Member Mellera. Member Jordan suggested that a Task Force subcommittee be established to work on the Master Fuel Contract stipulations with Member Bali.
Ms. Shannon Devine recommended that the Master Fuel Contract contain a contingent that the City can purchase ten 100,000 gallons a month from new local businesses. Ms. Devine explained that she would be building a processing plant that won’t be up and running for at least a year and inquired about the length of the contract. Chair Bowen reported that historically, Master Fuel Contracts run for three years. Ms. Devine stated that if that were the case, she would not have the ability to sell fuel to the City for two years. Chair Bowen stated that any definition of sustainability should include using local feedstock as there are fewer transportation issues around sustainability and local production. Ms. Devine stated that the Master Fuel Contract should be adjusted to include a contingent on the amount of biofuel that can be purchased from smaller businesses over the years. Member Bali reported on the City’s requirements for doing business with vendors, which involves an approval process. It was recommended that Ms. Devine start the approval process early in order to be placed on the list of approved vendors. Ms. Bali explained that the process would involve the issuance of a Request for Proposal (RFP) and then approved vendors would bid on the RFP. Qualified vendors that are on the list receive a letter notifying them when the RFP has been issued. Ms. Devine recommended that tradition be changed to support small City businesses since biofuel and environmentally friendly fuels are the new mandate.
Mr. von Wedel thanked Member Bali for working on this effort and discussed past inconsistencies with distribution, timing, and the City not knowing what blend it was getting. One analysis was done, and it was discovered that the blend the City was getting was B4 instead of B10. Having one person review the paperwork would be a big help.
7. Biodiesel Access Task Force Major Goals and Initiatives for 2008. (Continued Discussion from the August 13, 2008 Meeting) (Discussion) This item was not heard at this meeting. Continued to the December 10, 2008 meeting.
8. Update on the Status of the Biodiesel Manufacturing Plant in San Francisco. (Continued Discussion from the August 13, 2008 Meeting) SPEAKER: Member Eric Smith. Member Smith reported on his attendance at a press conference a few weeks ago to announce Darling International’s plans that were approved by the Port, Board of Supervisors, and Mayor to start a biodiesel production facility at Pier 92. The facility is scheduled to open for business in December 2009. Member Smith stated that he had recommended that Darling hire from the Bayview community and discussed training programs for Bayview residents on the biodiesel process. It was reported that Darling indicated that they would be utilizing methods to reduce the odors caused by their plant, and reports were made that the odors have decreased. Member Smith reported that Darling plans to produce B100 only and ship it to local blenders. Member Smith also discussed his interest in Darling supplying sustainable quality biodiesel for San Francisco and turning them into a greener company.
9. Status Report on Recommendations to the Board of Supervisors on Incentives and Other Measures that the Task Force should take to Promote Biodiesel. Review and approval of draft letters to send to the Fire Department and other City agencies recommending fee waivers. (Explanatory Document: Fee Waiver Draft Letters) (Continued from the August 13, 2008 Meeting) (Discussion and Action)
Member Jordan distributed two Fee Waiver Draft Letters addressed to Chief Building Inspector Kornfield, Department of Building Inspection, and to Fire Chief Hayes-White of the San Francisco Fire Department requesting fee waivers for existing and new franchise gas stations and small business owners in San Francisco in order to offer an incentive to dispense biodiesel. It was explained that these are very similar to a letter that was submitted to the Department of Public Health and for which approval was granted by the Department. Member Swiggers inquired whether the fee waiver could be retroactive. Member Jordan reported that he would edit the document to add a retroactive request. Upon Motion by Chair Bowen and second by Member Smith, without objection, the letters were approved with an amendment to add a retroactive stipulation.
10. Status Report on Discussions with Gas Stations on the Prospect of Selling Biodiesel to Individual Consumers and Green Depot Program Report. (Continued from the August 13, 2008 Meeting) (Informational Report and Discussion) Member Jordan reported that Rainbow Grocery’s membership had approved the permanent station on their parking lot to sell a sustainable biodiesel B99.9 or B100. Another entrance would be added so cars can drive through and fill up during Rainbow’s normal business hours. This project is also helping integrate with all other biodiesel companies locally San Francisco’s carbon fund so carbon credit incentives can be identified. Member Ving congratulated Member Jordan on his efforts in this area.
11. Update on Permitting Regulations for Biodiesel. (Continued from the August 13, 2008 Meeting) (Informational Report and Discussion) SPEAKER: Member Jordan. This item was not heard at this time. Continued to the December 10, 2008 meeting.
12. Hazardous Material Classification of Biodiesel. (Continued from the August 13, 2008 Meeting) (Discussion and Action)
Mr. Jorge Villa, State Division of Measurement Standards (DMS), reported that he received an email from Member St. Jean questioning approved meters and dispensers for B100. It was explained that there is only one approved dispenser for B100 at this time, and that he has run into a situation where there are salespeople selling dispensers that they claim are approved, but are not. Mr. Villa stated that he would put together a list of all approved truck meters, but that there is only one at this time. Mr. Villa discussed B20 specifications and labeling issues that are being worked on that California will be adopting. It was explained that the Division of Measurement Standards is issuing variances for developable fuels at this time, and that anything above a B20 blend needs a variance. B5 is the easiest fuel to work with because it is covered under the engine manufacturer’s warranty.
Mr. Villa offered his assistance in coming out to the site to make sure that all material is compatible. Chair Bowen stated that DMS has been very helpful in getting the earlier biodiesel programs started and appreciates their constructive attitude in working with the industry.
13. Informational Report to the Board of Supervisors Update. Review and approval of Draft of Final Report to the Board of Supervisors (Explanatory Document: (1) Report Draft; (2) Report Draft Continued) (Continued from the August 13, 2008 Meeting) (Discussion and Action) SPEAKER: Member Jordan
Member Jordan submitted the near final draft report that requires minor formatting, a City seal, and a title page in order to be issued to the Board of Supervisors. A Table of Contents was distributed. Task Force Secretary Monica Fish would assemble and scan the document and forward it to the Department’s Program Outreach Manager to forward to the Board of Supervisors. Once finalized, the Report would be added to the Biodiesel Task Force’s website housed at the Department of the Environment. Upon Motion by Chair Bowen and second by Member Smith, without objection, the Report was approved for finalization and submission to the Board of Supervisors.
14. Update on the Biofuel Recycling Waste Cooking Oil Program. (Continued from the August 13, 2008 Meeting) (Informational Report and Discussion)
Member Ving reported that there are over 500 restaurants participating in this program, and the focus is now on the residential sector. It was explained that there are three components to the residential program and they are all centered on how to reach out to the San Francisco community and make it as easy as possible in a number of ways for people to donate their grease and cooking oil. Member Ving reported on last year’s successful post holiday events after Thanksgiving and Christmas where people dropped off their used cooking oil in non-breakable collection containers at Costco for a three-day period. People were respectful of the information and instructions were very clear. It was reported that Costco will be participating again this year. There have been conversations with Whole Foods, and there are a number of smaller chains and independent markets that are being looked into.
Member Ving discussed the second component, which is the Gigantic 3 program run by Sunset Scavenger, the Department of the Environment, and Norcal, where they go region by region in the City and offer a household collection of all kinds of material from sofas, batteries, fluorescent lights to now cooking oil. Approximately 400 cars line up before 7:30 a.m. on Saturdays to do this. Member Ving stated that the third component is establishing permanent sites for collection. There is currently one Norcal hazardous waste site on Tunnel Avenue that generally generates about 250 gallons of cooking oil donated from residents each month. Consideration is being given on how to get more of those sites throughout the City, which Member Jordan has been working on. An effort is also being made to educate residents not to put cooking oil down the drain and for residents and businesses to recognize the commercial value and the organic BTU’s that is in this material that is being thrown away.
Member Ving reported that there will be a huge campaign for the next four months, bus signs, etc. to really focus on no oil down the drain campaign. The second major endeavor is the brown grease to biofuel demonstration that is a free demonstration to pilot and ideally bring to market brown grease to biodiesel technologies, to showcase small business technologies, and work out their commercial viability for brown grease to biodiesel. In addition, there will be intern programs and development of green jobs from this program.
Member Jordan stated that the program is in a great stage for behavior and development change messages for feedstock development. Member Ving explained that it is turning a different course for a large utility to endeavor into organic resource management. The objective is to capture as much of this organic BTU at the source (kitchens) because there is still grease coming through the sewers. Methods are being researched on how the treatment plant can segregate and utilize the material.
Member Burgard discussed the possibility of picking up waste grease on a regular basis as opposed to holidays only. Member Ving stated that it is a matter of working out the logistics with the City and Norcal. Jordan stated that curbside collection is a new concept which needs to find its way into the existing infrastructure. Member Ving stated that curbside collection would require consideration of solutions to various scenarios, such as oil spills on sidewalks, etc. Member Berman recommended a contact that works with solving problems with special waste streams that do not work well in the traditional solid waste management infrastructure.
Public Comment: Mr. von Wedel reported that Disneyland collects all of their used cooking oil to process into biodiesel and running their B99 trains and the Monorail truck that pulls the Monorail when it shuts down.
15. New Business/Future Agenda Items. (Information and Discussion)
Chair Bowen introduced Ms. Jenna Higgins and Mr. Joseph Jobe from the National Biodiesel Board. Ms. Jenna Higgins, Director of Communications for the National Biodiesel Board, reported that she has been working on the biodiesel issue for eight years, organizes the general sessions, and works on a panel to discuss the City’s involvement. Ms. Higgins reported that the Biodiesel Board’s upcoming conference would include a discussion on the City’s successful biodiesel accomplishments. Mr. Joseph Jobe, Chief Executive Officer of the National Biodiesel Board, reported on his work with biodiesel since 1997. Mr. Jobe stated that the Biodiesel Board would be showcasing the City’s accomplishments and leadership at their February conference.
Mr. Jobe reported on accomplishments in Washington D.C. to extend and modify the biodiesel tax credit for one year that was passed by the House of Representatives and signed by the President. Mr. Jobe outlined the tax credit provisions/policy changes and discussed their plans to work on a longer extension. A discussion was held on the Presidential candidates’ positions on alternative fuel tax credits and cap and trade programs for carbon reduction.
Member Smith stated that California has been dealing with the State Water Resources Board in terms of underground storage tanks and hazardous material classification without a lot of success. Mr. Jobe reported on difficulties they have experienced working with the Water Resources Board. It was reported that work is being done on producing certifications for the underground storage tanks for biodiesel, but that it is a minimum 18-month process. Mr. Jobe stated that they are working on efforts to see if anything can be accomplished legislatively.
Member Smith reported on testing that had been done by the California Air Resources Board (CARB) on 1944 railyard locomotives using B50 and B100 biodiesel. CARB’s test indicated that when the trains ran on B100, it was a 73% reduction in particulate matter; and 50% reduction when using B50. It was explained that the NOx was high, but it is assumed that it is due to the fuel injectors and that it is an old engine and does not burn as cleanly. Member Smith explained that this is the first train ever tested by CARB, and they would be returning to do another test on a second locomotive. CARB also wants to do a test on a more modern train and then share information with the Environmental Protection Agency and other relevant agencies. Member Bali stated that the Department of the Environment and Public Health would not want to move forward with something that would increase pollutants that is known to adversely impact children and the elderly.
Ms. Fish distributed a memo from the City Attorney’s Office on Political Activity by City Officers and Employees and requested that members contact Deputy City Attorney Catherine Barnes with any questions.
Public Comment: Ms. Devine announced that Fat Free Biofuel is having an awareness party on October 18th and extended an invitation to everyone. Ms. Devine stated that it would be a good opportunity for people to set up booths and distribute literature. Ms. Devine stated that she would be sending an email invitation to Ms. Fish to forward to everyone.
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. There was no public comment at this time.
17. Adjournment. The Biodiesel Access Task Force meeting adjourned at 12:06 p.m.
** Copies of explanatory documents are available at (1) the 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 meeting website as attachments to the agendas or meeting minutes.
*Approved: December 10, 2008