TOSCO Cogeneration Facility (TOSCO, TOSCO Martinez, Foster Wheeler Martinez)

Docket No. 83-SPPE-1

Small Power Plant Exemption Granted November 30, 1983

Project Manager: Gary Walker

Staff Counsel: David Mundstock


Project Summary

SPPE Filing and Project Description

TOSCO filed its Application for a Small Power Plant Exemption (SPPE) on March 29, 1983. It proposed an 88 MW cogeneration facility at TOSCO’s Avon Refinery near Martinez in northern Contra Costa County. The fuel was refinery gas, a by-product of refinery operations, with natural gas as the backup fuel. TOSCO planned to offset its new air emissions by shutting down existing refinery oil-fired boilers that would be replaced by the cogeneration plant. The cogeneration plant would provide steam to the refinery and electricity for sale to Pacific Gas and Electric (PG&E).

The SPPE Process

SPPEs are governed by Public Resources Code section 25541. The CEC must make two separate findings in order to grant an SPPE - that "No substantial adverse impact on the environment or energy resources will result from the construction or operation of the proposed facility" and that "Generating capacity will not be added which is substantially in excess of the forecast of electrical energy demands adopted pursuant to subdivision (e) of section 25305)." If an SPPE is granted, an applicant then obtains local permits for its powerplant rather than a CEC license.

Assuming SPPE approval, the major permit TOSCO had to obtain was an Authority to Construct from the Bay Area Air Quality Management District (BAAQMD). The application and review process for that permit was conducted concurrently with the SPPE process.

CEC staff’s environmental analysis for an SPPE is presented in an Initial Study, which the CEC conducts as the CEQA lead agency for the project under Public Resources Code section 25519(c). Traditionally, a facility which qualifies for issuance of a negative declaration is considered to also satisfy the environmental finding for granting an SPPE.

Air Quality and the BAAQMD Review

The BAAQMD review was a lengthy process because it incorporated all aspects of the cogeneration plant’s functions and emissions as part of an Authority to Construct and Permit to Operate. BAAQMD initially determined that TOSCO’s application to the air district was incomplete. Once the deficiencies were satisfied, the air district intended to reduce project emissions through agreement with TOSCO over a more stringent interpretation of what constituted Best Available Control Technology (BACT). CEC staff then needed to review BAAQMD’s work, plus that of the U.S. Environmental Protection Agency (EPA), in order to fully understand the project’s air quality impacts prior to issuing its Initial Study.

At the June 23, 1983 Pre-Hearing Conference, TOSCO agreed to an extension of the schedule to accommodate both BAAQMD and the CEC staff. Thus, although the TOSCO Cogeneration Facility had no opposition and ultimately no issues, the review still took eight months.

The Initial Study/Draft Negative Declaration

On August 1, 1983, BAAQMD issued its Preliminary Decision granting TOSCO a permit to construct the cogeneration plant, with lower emissions than originally proposed. This was followed by a similar Preliminary Determination in TOSCO’s favor from EPA, issued on September 23, 1983. All air quality issues had been resolved.

The CEC staff then issued its Initial Study and proposed Negative Declaration for TOSCO on October 4, 1983. Staff found that the mitigation measures in all areas, including air quality, were acceptable, and the proposed facility would not have a significant impact on the environment. The Initial Study included staff’s demand conformance analysis, which determined that TOSCO was not likely to add generating capacity substantially in excess of PG&E’s forecasted needs.

CEC Approval

After an uncontested evidentiary hearing, the full Commission approved the TOSCO SPPE in a 2-page Decision issued on November 30, 1983 that contained the necessary findings under Public Resources Code section 25541. The project was constructed under local permits, beginning operations in 1985.

Safety problems and accidents at the TOSCO refinery, including fatalities, resulted in the refinery later being sold to Foster Wheeler.