How Biomass Electricity Can Satisfy�SB 1383 Requirements�

September 2023

Based on Original Presentation 1/23/2023

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Agenda

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• SB 1383 background and compliance options
• Biomass-to-Electricity within SB 1383
• Procurement Compliance Attributes
• Compliance Process, including record-keeping requirements
• Desert View Power Plant

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SB 1383 background and compliance options

• SB 1383 requires reduction of organic materials entering landfills
• Effective Jan 1, 2022
• Sets requirements for jurisdictions to procure Recovered Organic Waste Products (“ROWP”)
• Jurisdictions may comply by direct procurement or by working with a Direct Service Provider (DSP).
• Products may either be used or given away (e.g., free mulch to citizens)

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Additional material: helpful summary presentation by StopWaste.org can be found at https://www.stopwaste.org/sites/default/files/SB-1383-procurement-pres_DRAFT.pdf

Procurement Compliance Attributes

Electricity attributes generated by Desert View Power

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Electricity & remaining attributes sold to grid/offtakers

PCA sold to jurisdiction based on its usage

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Compliance Process Overview

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Jurisdiction

Desert View Power

Jurisdictions purchase power from their normal provider (i.e., PG&E, SDG&E, CCA’s, etc.),

DVP converts biomass to electricity, sells power to California utility

California power grid

Electricity meters measure DVP production

DVP and jurisdiction enter into agreement to sell Procurement Compliance Attribute from biomass-to-electricity to jurisdiction (“paper transaction”). Agreement includes necessary record-keeping requirements to comply with CalRecycle regulations.

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Biomass-to-Electricity within SB 1383

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• Greenleaf has worked with CalRecycle on the drafting of the FAQs regarding the use of biomass electricity to satisfy the ROWP procurement requirement in the regulations: electricity consumption by a jurisdiction may be counted as ROWP from biomass conversion¹ subject to certain restrictions
• Can only count actual electricity purchased and used by the jurisdiction (i.e., usage for municipal operations only – not usage by residents or businesses unless there is a direct service provider relationship per 14 CCR 18993.1(e)(2).)
• Jurisdiction must acquire Procurement Compliance Attributes (PCAs) from a biomass facility to match with the energy the jurisdiction consumes
• Does not matter whether jurisdiction’s direct electricity provider is investor-owned utility, municipal utility, or community choice aggregator
• There are record-keeping requirements to demonstrate compliance

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¹ See “Electricity from Biomass Conversion” section of CalRecycle FAQ: https://calrecycle.ca.gov/organics/slcp/faq/recycledproducts/#electricity

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Desert View Power is well-situated to receive 1383-compliant biomass feedstocks and convert this material to ROWPs that can be transferred to jurisdictions for their compliance

Compliance Process Best Practices

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Key point: Jurisdictions are NOT purchasing electricity directly from DVP, only Procurement Compliance Attributes that comply with SB 1383’s ROWP requirements

• This is a “paper transaction” that recognizes DVP is converting biomass to electricity for the California power grid, and jurisdictions are procuring electricity from their normal supplier.

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How does a jurisdiction show procurement of electricity from biomass conversion?

• Two elements: (1) energy and (2) procurement compliance attribute
• Energy will be measured in kWh or MWh and will appear on electricity bills received from the jurisdiction’s existing electric provider
• The procurement compliance attribute comes from a biomass facility that is using material received from an approved source as listed in 14 CCR Section 18993.1(i) to create electricity that is placed on the electricity grid.
• Energy: Copies of the jurisdiction’s electricity bills are sufficient evidence to document procurement of the energy
• Procurement Compliance Attribute:
• Jurisdiction should have a signed agreement with a biomass facility to receive PCAs from the facility
• Alternatively, a jurisdiction may contract to purchase PCAs from a third party that has acquired the attributes from a biomass facility
• For example, some waste haulers may have contracts directly with biomass facilities to acquire PCAs which would then be available for resale to jurisdictions

Compliance Process Best Practices

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Additional documentation jurisdictions should receive from biomass facilities

• Jurisdictions should be prepared to have all documentation that demonstrates to CalRecycle that electricity from biomass conversion has been legitimately procured in compliance with the terms of the regulations (14 CCR Section 18993.2). In the case of electricity from biomass conversion procured via the utility electric grid, CalRecycle, in a compliance review, would be looking for:

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• Written certification from the biomass conversion facility certifying that biomass feedstocks were received directly from permitted solid waste facilities and operations, i.e., composting facilities or operations, transfer/processing facilities or operations, and/or landfills [see 14 CCR Section 18993.1(i)].
• Documentation that the electricity from biomass conversion has legitimately been procured and can be counted towards the jurisdiction’s procurement target. This could include, in addition to other relevant records, documentation that:
• The procurement compliance attribute is being supplied exclusively to the jurisdiction and there are no duplicate sales or double counting to other jurisdictions of the generated biomass electricity.
• The total quantity of biomass electricity exported and the total quantity of electricity procured to demonstrate procurement that the quantity procured is not in excess of actual generated supply.
• The total quantity procured does not exceed the amount used for municipal operations.

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• If jurisdiction is purchasing from a third party, that third party should receive the above information from the biomass facility which it can provide to the jurisdiction
• Third party documentation should include further detail on that party’s disposition of the PCAs to demonstrate that there are no duplicate sales or double counting to other jurisdictions of the generated biomass electricity
• For example, third parties could be waste haulers or brokers. These entities would purchase PCAs from biomass facilities and resell to jurisdictions for compliance purposes. The limitation that jurisdictions can only count actual electricity purchased and used by the jurisdiction (i.e., usage for municipal operations only – not usage by residents or businesses) would still apply

Desert View Power�Plant Overview�

• Owned since 2010 by Greenleaf Power
• Certified Renewable Energy
• 5-year Power Purchase Agreement with IID signed April 2022
• Located on the Cabazon Band of Cahuilla Indians Reservation
• Produces enough energy to power nearly 50,000 homes for a year

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• Diverts significant waste from landfills throughout southern California
• Eliminates the need for open burning of agricultural waste in Coachella Valley (not related to SB 1383)
• Controlled combustion in a biomass boiler coupled with emissions controls technology dramatically reduces the creation and release of criteria pollutants.
• Versus open burning, DVP reduces particulate matter (PM), nitrogen oxides, carbon monoxide, and volatile organic compounds

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Desert View Power�Scale of ROWP Offering

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Desert View Power�Available ROWP Opportunity

• Procurement Compliance Attributes (PCA) allow jurisdictions compliance at low cost, immediately and without any capital or infrastructure costs
• PCAs can be used by a jurisdiction in California
• PCA offering has near-zero overhead cost to jurisdiction.
• Attestations, fuel tracking, and PCA creation is all performed by DVP.
• Jurisdiction only needs to verify energy consumption from existing billing.
• DVP will assist jurisdictions with CalRecycle Reporting
• Limitation: jurisdictions can only use as many PCAs as they use power for municipal operations
• Requires monthly kWh usage from power bills
• Desert View Power has been generating procurement compliance attributes since January 1, 2022
• Procurement compliance attributes from electricity generated during any year can be applied toward that year’s procurement requirements

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Latest Updates

• Desert View Power has entered into contracts with certain cities in Northern California
• Agreements for multiple years of sales to cities for SB 1383 procurement compliance
• Contracts directly with jurisdictions, but worked with CCA to negotiate group discount
• DVP is open to informal groups or joint ventures to allow for volume discounts
• PCA Contracts may qualify for use with grant funds (determined by language of grant application)
• The SB 1383 Local Assistance Grant Program application is now open.  Instructions on how to apply, as well as relevant program information and fundings estimates, can be found on the SB 1383 Local Assistance Grant Program - CalRecycle Home Page.

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Summary

• Biomass to electricity is an acceptable procurement option under SB 1383
• Desert View Power takes material received from an approved source and sells electricity onto California power grid
• DVP will provide all required records, including fuel purchases and power production
• Jurisdictions purchase electricity as normal from their utility, maintain records of power used for municipal operations
• Jurisdiction purchases “paper transaction” from DVP or third-party (e.g., waste hauler) to document compliance
• Jurisdiction maintains records to comply with SB 1383 procurement requirements

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Contact Information

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Additional Questions?

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Greenleaf Power:

Geoff Harmon

gharmon@greenleaf-power.com

(916) 596-2513

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CalRecycle:

Your Local Assistance and Market Development Branch Liaison

https://calrecycle.ca.gov/lgcentral/contacts

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