rgy, Ocean Resources and Federal
Consistency
Division

Subject: STAFF REPORT ADDENDUM for Item F5a

Coastal Development Permit E-07-011 (Whole Energy Fuels Corp., San
Mateo County, Biodiesel Production Facility at Calera Creek Wastewater
Recycling Plant site)
Staff is correcting information in the original staff report mailed for this agenda item.
Proposed new language is shown in underline text; language to be deleted is shown in
strikeout text. Language suggested by persons other than staff is italicized.
Additional information from the applicant, as well as Commissioner ex parte
communications, public comment letters and letters received from two law firms
representing the City of Pacifica and the Quarry owner (to be included in staff report as
Exhibit H), since the publication of the staff report are also included in the Addendum
packet.
Based on this new information, staff is recommending the following revisions to the staff
report:
Summary Project Description, page 1, middle of page:

An 800 350 HP boiler and a 35 kW co-generator (to be fueled with biodiesel product) will be
located adjacent to the new building within the new building.

Executive Summary, page 2, end of first paragraph:

A boiler and a co-generator to provide heat energy for the processing will be located adjacent
to the new building within the new building in a separate area from the biodiesel processing
equipment, based on planning with fire and structural engineers. The boiler will be 350 HP,
or 900,000 Btu. Page 2



Executive Summary, page 4, middle of first paragraph:

Based on this analysis, it appears the BPF will produce approximately 352 metric tons per
year of CO
2
and near negligible amounts of other greenhouse gases; however, 99% a certain
amount of these emissions will be removed through the CCWRP soil scrubber process,
depending on the amount of carbon consumed by the microorganisms in the soil scrubbers.

Special Conditions, page 8:
Add the following additional special condition:

17.

Disposal of Glycerin. By December 31
st
of each year, the applicant shall
provide for Executive Director review and approval an annual report on the
percentage of glycerin by-product that is sold and disposed of and the location of
the disposal, if any. If glycerin is disposed of within the coastal zone, the
applicant shall apply for an amendment to this permit for the existing disposal and
for any future disposal that may occur.

Project Description, page 9:

The facility includes twelve tanks in the 2,000 to 12,000 gallon range containing materials
required for or produced by the biodiesel production process, including: used cooking
(vegetable) oil, wash water, glycerin, methanol, and sodium and/or potassium methylate, and
sulfuric acid.

Exhaust gas from these units will be piped into the BPF where it will be connected to the
base of the used vegetable oil (feedstock) tank to allow emissions to bubble up through the
waste oil to remove particulates and Volatile Organic Compounds (VOCs). Whole Energy
estimates that up to 99% of particulate matter and VOCs will be absorbed through this oil
scrubbing process. From the top of the oil tank, the remaining gases will mix with the
ventilation air in a manifold before being drawn by a blower through an underground exhaust
duct that is linked to the biological soil scrubbers located on the roof of the CCWRP. Whole
Energy estimates that the use of the scrubber devices will reduce BPF emissions of carbon
dioxide and other GHGs, as well as methanol vapors, particulate matter and odors by up to
99%.

Project Description, page 12, top of page:

Whole Energy, which has built several other biodiesel wastewater treatment plants in
Washington state, states that wastewater facilities are suitable candidates for co-location as
they readily provide water for biodiesel processing and treatment equipment for wastewater as
well as air emissions, in this case, with biological scrubber systems.

Biological Resources (ESHA), page 13:

Coastal Act Section 30107.5 states: Page 3



Environmentally sensitive area" means any area in which plant or animal life or their
habitats are either rare or especially valuable because of their special nature or role in an
ecosystem and which could be easily disturbed or degraded by human activities and
developments.

The lower reaches of Calera Creek and its associated wetlands were restored under the
permit for the CCWRP (1-95-040), which included significant re-alignment and re-grading
activities to re-establish the creek and its functionality; the original creek bed had been filled
as a result of grading activities conducted by the previous quarry owner (see 1-95-040).

The Commission considers Calera Creek and the upland areas within 300 feet,
including the settlement ponds,

to be environmentally sensitive habitat area (ESHA, see
Exhibit D) per the definition found under Coastal Act Section 30107.5 due to the
presence of a federally threatened species, the California red-legged frog (CRLF).

Biological Resources (ESHA), page 14, paragraph 4:

Operational noises at the BPF would consist of sounds from the loading and unloading
of materials from delivery trucks in the loading area and from the operation of the 50 HP
(35 kW) generator and 800 350 HP boiler. The 200 HP of noise-producing noise from
equipment in the BPF will likely be non-detectable from outside the insulated building;
the generator and boiler would be separately housed within an insulated container to
minimize noise impacts. Whole Energy is seeking to eventually upgrade the generator to
800 HP, pending approval by the BAAQMD, which would result in a noise level of
approximately 70-75 dBA, or the equivalent of an idling truck engine inside the insulated
shed. The 800 350 HP boiler is essentially a water heater and would not generate
considerable noise.

Biological Resources (ESHA), page 14, footnote 8 at end of first paragraph:
8
The Commission received a comment letter on July 8, 2008, from Shute, Mihaly & Weinberger LLP,
representing the City of Pacifica, which recommends two clarifications of the staff report (see Exhibit H for
letter). The Commission concurs with and has made the first recommended change to remove mention of who
filled the original Calera Creek bed. The Commission declines to adopt the second suggested change to the
staff report recommended by Shute, Mihaly & Weinberger LLP consisting of omitting staffs recommended
ESHA designation for Calera Creek and the adjacent wetlands because the Commission did not include this area
as ESHA under the previous permit for the CCWRP (1-95-040). With regard to designating the riparian areas
adjacent to the CCWRP as ESHA, staff points to data in the January 2007 Swaim report that clearly
demonstrates these areas currently support California red-legged frogs; therefore, these habitats qualify as
environmentally sensitive habitat areas (ESHA) as defined under Section 30107.5. This designation applies for
the proposed project regardless of the previous status of the area when the CCWRP was permitted in 1995. The
letter from Shute, Mihaly & Weinberger LLP also recommends that the Commission delay its ESHA
determination of the subject area until such time as a development is proposed in the vicinity of Calera Creek
and its associated wetlands that may pose adverse impacts. As stated elsewhere in the biological resources
section and the hazardous material spills section, staff believes that the proposed biodiesel facility may pose
potential adverse impacts to Calera Creek and the wetlands adjacent to the CCWRP due to the threat of
hazardous spills. The Commission therefore believes that it is appropriate to consider the ESHA when
evaluating a permit application for this proposed development. Page 4



A separate letter from Luce, Forward, Hamilton & Scripps LLP (representatives of the Peebles Pacific
Development Company, owners of the Pacifica Quarry) received on July 8, 2008, posits similar concerns
with the staff report findings (see Exhibit H for letter). Luce Forward states they believe that the staff
findings regarding the restoration of Calera Creek and its wetlands are misleading. The Commission
disagrees with the need to revise the staff report findings regarding the restoration of Calera Creek as
recommended by Luce Forward, but has deleted reference to the filling in of the original Calera Creek bed
originally included on page 13. Calera Creek was realigned under the permit for the CCWRP (1-95-040)
following previous grading in the area; as a result, the functionality of the creek and associated wetlands
was re-established and habitat restored, as intended under the CCWRP permit. Luce Forward also contests
the inclusion of the ESHA designation in the staff report findings for biological resources and recommends
instead referencing the open space deed restriction over an approximate 8 acre, upland hillside habitat area
located west of the CCWRP required under 1-95-040. The Commission declines to adopt the second
suggested change to the staff report recommended by Luce Forward and believes the open space deed
restriction required under the permit for the CCWRP does not address the issue of potential impacts to
ESHA from the proposed biodiesel project, whic