CaliforniaBiomass Collaborative

Executive Board Meeting Minutes

March 24, 2008

Founders Room, BuehlerAlumniCenter, University of California, Davis

Attending:

Trip Allen

Fernando Berton

Kevin Chen

Cynthia Cory

Bob Crandall

Robert Glass

Bruce Goines

Steve Kaffka

Ken Krich

Hal LaFlash

John Lazlo

Kay Martin

Gary Matteson

John Menke

Patricia Monahan

Gregg Morris

Steve Shaffer

John Shears

Matt Summers (for George Simons)

Val Tiangco

Mike Tollstrup

Fred Tornatore

Chuck White

Doug Wickizer

Bryan Jenkins

Steve Kaffka

Rob Williams

Martha Gildart

Cora Monce

Gerry Braun--CEC (guest)

The meeting convened at 10:00 a.m.

Welcome and Introductions:

Executive Director Bryan Jenkins welcomed members and conducted around-the-table introductions. John Lazlo with PG&E will be retiring and Hal LaFLash will take his position on the board.

Meeting Overview:

Jenkins summarized the agenda and meeting goals and indicated the meeting would cover the collaborative 2007-08 work status, planning for the 5th annual forum, committee efforts on the roadmap implementation plan, state permit streamlining, and future work projects. Val Tiangco requested moving the discussion on the 2007-08 work status first on the agenda.

Jenkins described staff work updating the biomass resources database, with crop data from 2007, waste data from 2006, and forest data from 2004. A draft of the update report will be available in April. He described other data collection efforts for dedicated crops, food processing residues, and a forestry study with the Western Governor’s Association. He also described the annual reports and planning for the 5th annual forum.

Preparation for the Collaborative’s 5th Annual forum

Martha Gildart described the preparations for the three-day forum on sustainable bioenergy, to be put on jointly by CBC, CEC, CIFAR, CEERT and CARB. It is scheduled for the end of May at the SacramentoConvention Center. To date about two thirds of the speakers have confirmed participation. The draft program topics include: national and international efforts to define sustainability and establish principles of sustainability; life-cycle analysis approaches and modeling; and industry needs, practices, and certification; winding up with a panel discussing state policy development on the last day.

Chuck White asked how greenhouse gas credits and the carbon market would work, suggested that an important topic for the forum is to explain the incentives available to bioenergy projects, particularly those using urban waste, such as tradable carbon credits and describing how it all comes together. Fernando Berton suggested that the speakers in session 10 could be asked to cover incentives in their policy discussions. Patricia Monahan suggested names of potential speakers: Fargionne, Tillman, Houghton and a possible GTAP presentation.

Kay Martin asked how types of biomass other than crops enter in to the program? She suggested the forum should have equal treatment of forestry and urban waste and how lifecycle analysis supports those resources. She provided a handout for Pacific Northwest National Laboratory work on waste conversion (attached.) Jenkins responded that there is a proposed speaker on forestry – Mark Nechodom - and we intend for speakers to cover all resource bases. Chuck White suggested the contractor for the CIWMB organic waste analysis – Keith Weitz – and Berton added the study is an LCA for biological carbon in California’s urban waste, he suggested a fit in session 6.

Patricia Monahan felt the renewable fuel standard should be brought out and added more names, some of whom are already scheduled to speak.

Steve Kaffka summarized the discussion indicating the need for more concrete discussion on carbon credits and the low carbon fuel standard, urban waste streams, land use modeling, and organic life-cycle analysis study.

Cynthia Cory felt that there needed to be more focus on industry efforts and that session 9 could be expanded.

Gildart pointed out there is time available for evening receptions on the first and second days and asked if there was interest on the Board to co-sponsor them. White volunteered that WMI could provide the same level of support as for last year’s reception.

Kaffka described a pre-forum Workshop on May 27th for the UCCE Bioenergy Workgroupwith the objective to discuss biomass feedstock production from CA landscape.

Board Committee Reports

Committee chairs were requested to report on progress to-date in developing information for the Biomass Roadmap implementation plan.

Sustainability Committee Chair – John Shears

Presented slides of the outline for the sustainability committee’s white paper (see attachments.) Paper will cover the environmental footprint of bioenergy such as land-use changes and greenhouse gas emissions; how to estimate and measure benefits and changes, for example, cellulosic biofuels has a net benefit but cannot always see the magnitude; need to assess resource adequacy; evaluate climate change; look at the effect of second and third generation technologies such as algae and thermochemical technologies; and develop a process on how to arrive at a set of principles that would gain national and international acceptance particularly under WTO.

Ken Krich asked are we defining sustainability? Will this be in the forum?

Shears replied that there is a consistent theme through many of the proposed sustainability principles based on a growing knowledge of the complexity of biofuels with a coalescing of standards - recent papers are buttressing the more restrictive standards of the Netherlands and Germany. Social values are more difficult to account for, they are being included in EU efforts, not so much here in US or CA.

Monahan added that principles have been developed by other groups too and Doug Wickizer asked if the board had developed a definition to which Shears responded that we need to establish the principles first. A general discussion of principles and definitions being needed in the forum followed.

Gregg Morris asked if this effort focused just on crops or beyond? Use of urban waste and forestry thinnings has hit a “paralysis by analysis” stage where their use is overly restricted to the point the USFS is unable to remove excess fuel loading. Shears replied that while the outline does focus on purpose-grown crops, other presentations will be talking about forestry and waste resources.

Martin felt that there appeared to be an agricultural focus, don’t ignore urban wastes and residues. Need to evaluate tradeoffs because of difficulty to get to these resources.

Monahan asked if Shears wanted feedback now or go to sustainability workgroup to tackle comments?Krich felt we should move on with agenda and Jenkins recommended convening the committee to get this out and reviewed before the forum.

Permitting and Regulations Committee Chair – Fernando Berton

The committee (Pat Sullivan, George Simons, and John Menke) was to review the permitting regulations of state agencies for biomass facilities and suggest ways to improve the permitting pathway. Permit regulations have not kept pace with the development of new technologies. The committee has had conference calls but has not had much time to work. A draft document was prepared by Martha Gildart that described permit requirements for air and water quality and forestry regulations but it has not been reviewed by the three agencies concerned. The committee does not have much yet on land use and planning, which is difficult because that is primarily a local issue.

The CIWMB has finalized an organics roadmap and has started revising requirements on ADC (alternative daily cover). They are holding a workshop on April 16 and 23 on policies and the siting and planning issues in the solid waste facilities permit. Theyare looking for comments on what the board can do to help in local planning issues, for example, can CIWMB come in earlier to help pass facility permits. The chief counsel is reviewing the CT policy.

Also, Bob Crandall of the Department of Toxic SubstancesControl is working on streamlining of permit requirements for handling manure at dairy digesters.

John Menke added that he had looked for examples at the water board of projects facing difficulties getting permits and had not found any. Berton replied with the example of composting facilities that are unnecessarily required to meet waste discharge requirement as strict as landfill. Menke indicated that a process was needed to capture these issues. Steve Kaffka asked if a clearinghouse could be created on the web so that such problems could be posted. There followed a general discussion on the concept of a clearinghouse for permits to be included in the implementation plan and how it should be managed.

Berton stated that there are more stringent air quality regulations at the local level and asked how far down does this committee need to go in regulation review? Local or state level? Need guidance there. Krich replied that he viewed the purpose as to come up with specific examples that can be changed to improve the system. Berton said that he would schedule a conference call with the committee to get members engaged.

Incentives and Market Development Committee Chair – Gary Matteson

Matteson presented slides describing the white paper he prepared on incentives and sustainability for biomass use. The paper had been circulated but he did not receive comments back. The paper lists federal and state incentives, credits, etc. with over 100 identified. The incentives fall into both rewards and penalties related to the costs of acquiring and using biomass and the resultant pollution. Discussed the concept of paying rent for use of carbon and the release of CO2. The market development aspect describes new ways of providing services and that the cost of biomass management should not be a cost to the biomass production plant. Biomass currently falls between wind and solar in cost.

Martin asked if the research looked only at power production and Matteson answered that it was broad based and included any bio-product.

State Permit Streamlining Discussion

Bob Crandall from DTSC is working with the CalEPA agencies on methods to simplify the permitting of bioenergy projects. They are starting with manure digesters at dairies and hope to expand efforts to co-digestion next. The workgroup is charged with putting in one place the requirements for obtaining a digester permit with timetables, costs, etc. They have developed a draft manual to be finalized in June. Second assignment is to develop a general state-wide water permit for all types of digesters, he has $1 million for the study. Will need to prepare a statewide programmatic EIR rather that complying with CEQA on a case-by-case basis.

White asked what kinds of digesters were considered and Crandall replied they are looking broadly, for instance, including food waste digestion. Ken Krich asked about resolving permitting conflicts, Crandall replied that Ken Brennan with PG&E will track such issues. Discussion occurred about conflicts between methane emissions and NOx regulations; operations with the same processing but different endpoints such as compost, ADC, fuel and digesters; diversion credit availability; and the need to not lower environmental standards.

Wickizer asked which agency would be the lead on the programmatic EIR and Crandall replied their attorneys are looking at the definition as a project under CEQA and who should be involved at the state and local level. Martin asked about acceptance by ARB and Waste Board and Crandall replied that most of the projects were in the San Joaquin district, may have to adjust some standards.

Matteson asked to what extent they tie in to the carbon offsets market, if capturing methane and emitting NOx, can they offset each other and Crandall replied that was not part of the effort but could be.

Shaffer described a dairy digester project that ran into high costs of obtaining a permit, they were required to complete a CEQA review and install low-NOx burners which added a half million to a $4 million project. Berton asked about sunset dates on WDR [waste discharge requirements] and John Menke replied that they have a 5-year lifetime and one for dairies would have performance standards.

Crandall summarized by saying they need flexibility in their approach and will be considering a centralized project serving several dairies to make it economical. He will circulate the draft permit manual to the executive board for comment when it is ready near the end of April. Cory cautioned on BACT standard-setting by giving an example of a project provided with a non-replicable “sales job” that became BACT for the state under the ARB.

Priority Actions – John Menke

Menke handed out a document listing the 192 or so roadmap actions where he indicated who he thought were the essential participants needed to accomplish the actions and in what timeframe. He felt it necessary to get commitments from the stakeholder groups which he has identified as: Government, Regulatory Agencies, Industry, Utilities, Research, Education, and the Public.

Berton stated that industry stakeholders have major influence over government when it comes to changing regulations, more so than the regulatory agencies. He added that, regarding the integrated waste management definitions, education is key. Legislators may not currently be objectively informed. Steve Kaffka expressed his concern that policies can have non-intended consequences if not evaluated beforehand and the process requires feedback from the regulated community.

Tiangco felt the need to prioritize the RD&D activities and get the roadmap implementation plan going--- maybe a separate meeting is required. Menke felt that there has been limited representation from government (ie legislative and executive branches).When asked, Jenkins stated that the intent is to design a plan to implement the priority actions. Discussion followed on who, when, and where to design the plan. Consensus that the 3 existing committees should prioritize the actions, identify the stakeholders, and draft steps to accomplish this via e-mail exchanges and conference calls. Gildart said that the driving force to carry out the plan will be the regulatory agencies so there is a need for the collaborative to meet with the agency chiefs. Martin agreed that we should at least give the agencies the opinion of the Collaborative.

Wickizer felt thatthe first need was getting the dedicated resources and then get broader support from agencies. Jenkins said that the Bioenergy Interagency Workgroup could contribute, Berton said he thought he could get staff support from the CIWMB, Crandall felt DTSC had skills to contribute, and Shaffer would ask existing CDFA committees.

Tiangco thanked the Collaborative for its effort and pointed out that the Collaborative was the only one with a roadmap at this time.

CEC/PIER – Gerry Braun

CEC’s Public Interest Energy Research program financially supports the CBC as well as wind and geothermal collaboratives and is about to launch a solar collaborative. They are in the process of developing next year’s research and development budget and are looking at the funding levels for demonstration projects and tasks done by the collaboratives. CEC is considering moving to fewer but largerprojects such as integrating renewables into high-voltage systems and zero-energy communities and buildings.

Jenkins asked how they were integrating with other state planning efforts and how this could fold into the CBC implementation plan. Braun replied that they were working with the CPUC and utilities. CPUC has a $50 million program supporting the solar initiative. The California Institute for Climate Solutions was planning work in PV as well.

Matteson said that developing the implementation plan will take months, may need to consider sustainability definitions in near-term, define principles then conduct beta-testing. Braun replied they are looking at how to work more effectively with the collaboratives, support for RDD at collaboratives has been short term, want to consider a more sustaining level of support with the potential for adding tasks and budgets.

Berton asked whether funding from AB118 could be used if collaboratives support the effort. Braun thought the collaboratives could match funds and Tiangco stated they were still in the planning mode. Braun added they are discussing how to achieve cost efficiency in contracting and integration with the collaboratives, thinking about an umbrella contract, probably will be moving forward in the next few months, expect individual collaboratives to continue on their technologies.

Dedicated Crops Economics Modeling – Stephen Kaffka

The Collaborative is conducting an assessment of sustainability in California crops and globally, using a linear programming model approach. He gave the example of almond growers planting energy crops between rows during winter. They are looking at options for northern and southern locations, wet or dry climate and soils, etc. and can add constraints and policy issues such as NOx emission limits, crop prices, crop rotation, growing seasons, use of salt-contaminated soils or retired lands, desert versus valleys, delta region versus dry-farming, etc.