Legislature(2003 - 2004)
04/14/2003 01:05 PM RES
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
HJR 19-FEDERAL DIESEL FUEL REQUIREMENTS CHAIR FATE announced that the first order of business would be HOUSE JOINT RESOLUTION NO. 19, Relating to the ultra low sulfur diesel fuel requirements of the United States Environmental Protection Agency and their application to Alaska. Number 0270 REPRESENTATIVE RALPH SAMUELS, Alaska State Legislature, sponsor, characterized HJR 19 as a resolution that would address an unfunded mandate from the federal Environmental Protection Agency (EPA). He explained that low sulfur diesel fuel is going to be mandated regardless of the actions of the state, including the Department of Environmental Conservation (DEC) or other state entities. He indicated low sulfur diesel fuel will be used [more frequently] in mainly rural communities in Alaska, where energy is mostly produced by diesel generators. Whether this fuel will work remains to be seen; also unknown are the kinds of retrofits required. It won't be this year or next year, but there are going to be problems associated with it. Engine manufacturers are going to have to start developing engines that use this low sulfur fuel, if they have not already, he suggested. He commented that if people did not use this type of fuel, there would not be new engines on the road. REPRESENTATIVE SAMUELS cited two problems that the resolution addresses. First, the state has authority to receive receipts from the federal government to do a health study to see whether there actually is a health risk involved in mostly rural communities with the diesel generation; however, thus far Congress hasn't funded the health study, and so the first phase of the resolution asks that the federal government provide the money to do the health study. Second, the resolution addresses how this will affect the logistics and the economy of rural Alaska and whether tanks need to be retrofitted or whether someone needs to go to the Denali Commission to build new tanks. Fuels cannot be mixed. Therefore, if a barge only delivered fuel to rural communities once a year and tanks were half full of the old type of fuel, the tanks would have to be emptied and scrubbed before the low sulfur fuel could be added. Number 0454 REPRESENTATIVE SAMUELS said retrofits might be needed on the generators themselves, but it was not known what exactly would be involved. There's no way to predict what the cost of the [low sulfur] fuel might be; market conditions are going to determine that. Currently, he said, there's only one manufacturer of the arctic-grade fuel, and it is in Canada; assuming that this happens, there will probably be more. Tankers will need to be scrubbed also. "If we go 50/50, you could only take half the load; that's also going to affect the prices of fuel," he said. He added that while the cost of fuel cannot be determined, the logistical costs can be - the cost to retrofit [equipment], the costs to scrub the tanks, and whether new tanks need to be built are all things that can be [determined]. REPRESENTATIVE SAMUELS explained that the resolution asks the delegation to work with the EPA and to coordinate with DEC, the Department of Community & Economic Development (DCED), and potentially the Denali Commission to pool their resources and get the EPA to fund the health study and determine the costs. He expressed concern if the costs and the health risks aren't determined. He said there's absolutely no doubt that this is going to happen, so [the legislature] should know about it and [work] to get the congressional delegation to help [the state with funding]. Number 0628 CHAIR FATE asked Representative Samuels if any timeline that he knew of would compel [the legislature] to set dates. Number 0665 ERNESTA BALLARD, Commissioner, Department of Environmental Conservation, explained that low sulfur diesel requirements for trucks and buses [become effective] in 2006, so before that date it should be known what needs to be done. She said [DEC] wants to have a good handle on the health issues, but that's not really the subject of Representative Samuels' initiative; his is far more an interest for the communities' sake in planning how they will handle fuel management. Number 0742 REPRESENTATIVE GATTO asked Commissioner Ballard what health issues would be involved in switching from using high sulfur fuel to low sulfur fuel. COMMISSIONER BALLARD said that's what [DEC] would like to know. REPRESENTATIVE GATTO asked if it would reasonable to expect that there would be a [health risk]. COMMISSIONER BALLARD said regarding health information, the [department] had recently come to understand a great deal more than in the past about exposures to diesel fumes. For many years, those exposures were considered to be comparable to the exposures to dust. In the last five or six years, however, national analysis has demonstrated that there's a far greater risk associated with those exposures in chronic respiratory diseases such as emphysema and asthma, and that there is clearly an established link between exposure to diesel fumes and cancer, she explained. COMMISSIONER BALLARD said it's that work and the exposures associated with trucks and bus diesel-exhaust fumes that led EPA to the national promulgation and the requirement for the low sulfur diesel fuel. [The department] realized that although Alaska doesn't have highway exposures comparable to those which were the basis for that study, the state has very unusual rural exposures to diesel from combustion in diesel generators. There is no other place in the country that would have those comparable kinds of exposures, she added. COMMISSIONER BALLARD offered her belief that the department should have a good handle on the health effects of high sulfur, low sulfur, or any sulfur diesel fuel. She said this is because [DEC] issues permits for all of those generators; if there is a health issue that the department should be aware of, it needs to build that into the permit conditions. The department's work is independent of the issue that really is at the heart of Representative Samuels' resolution, which is to find some way for communities to better prepare themselves to manage the fuel, she suggested. She said regardless of how communities manage the fuel, [DEC] should know what health issue may pertain to those exposures. Number 0914 REPRESENTATIVE GATTO asked if would there be a need for support for this kind of resolution if the engine manufacturers determine that they don't need any modification to switch to low sulfur diesel fuel. REPRESENTATIVE SAMUELS offered his understanding that the engine manufacturers have already made the modifications, and using high sulfur diesel fuel in an engine would result in major engine damage. He said it's a major modification and it's going to happen, because once the engines change over, high sulfur fuel cannot be used. Number 0970 CHAIR FATE offered that it seems the unintended economic consequences far outweigh the unknown health hazards [of low sulfur fuel]. He mentioned the remanufacture of engines or people going broke because they can't afford the new fuel. REPRESENTATIVE SAMUELS said he agrees with Commissioner Ballard that it is necessary to know the health risks, which is the point of the resolution. He reiterated that [switching from high to low sulfur diesel fuel] is going to happen in the future whether the state likes it or not. The EPA has come down with a ruling, and the manufacturers have been given the date [by which compliance is required]. Representative Samuels suggested [it is necessary] to find out about the health risks and address them if they exist, and to find out the logistical problems that are going to arise. For example, how much is it going to cost to retrofit or to keep using the high sulfur fuel? If there are no health problems and someone can't afford to retrofit, [using the high sulfur fuel] would be an option, he said. He noted that there were a lot of options available but didn't know what they were. Representative Samuels told members it shouldn't be too much to determine what would be required or what the choices are going to be. Number 1152 REPRESENTATIVE WOLF moved to adopt as the proposed committee substitute (CS) an unofficial, unnumbered work draft labeled "Conceptual CS for House Joint Resolution No. 19." There being no objection, the proposed CS was before the committee. [Tom Chapple, Acting Director, Division of Air and Water Quality, Department of Environmental Conservation, offered to answer questions.] Number 1245 REPRESENTATIVE WOLF moved to report CSHJR 19 [the work draft labeled "Conceptual CS for House Joint Resolution No. 19"] out of committee with individual recommendations and the accompanying fiscal notes. There being no objection, CSHJR 19(RES) was reported from the House Resources Standing Committee.