GUAM ENVIRONMENTAL PROTECTION AGENCY AHENSIAN PRUTEKSION LIN A' LA GUAHAN FELIX P. CAMACHO GOVERNOR OF GUAM
P.O. Box 22439 GMF • BARRIGADA. GUAM 96921 TEL: 475-1658/9 • FAX: 475-8007
MICHAEL
December 0 1, 2010
The Honorable Judith T. Won Pat, Ed.D. Speaker I Mina' Trenta na Liheslaturan Guahan 155 Hesler Place Hagatfia, Guam 96910
Buenas Speaker Won Pat, Attached is the final report from the Ultra Low Sulfur Diesel task force , organized by Guam EPA under the direction of Public Law 30-184. The necessary documents included on a CD attached to the report. If you have questions about this report, or would like more information on Ultra Low Sulfur Diesel and Guam's transition to using this fuel, please do not hesitate to contact myself or the Air Pollution Control Program at 475-1658/59.
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LT. GOVERNOR OF GUAM
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"A LL LIVING THINGS OF THE EARTH ARE ONE "
Findings and recommendations Ultra Low Sulfur Diesel Transition
Guam
Compiled by the ULSD Task Force, organized by the Guam Environmental Protection Agency as outlined by Public Law 30-184
Submitted to I Liheslatura on Dec . 1, 2010
Ultra Low Sulfur Diesel Overview What is Ultra Low Sulfur DieseP
' ltra Lm SuJfur Diesel ( LSD) fud a cleaner- burning eli sel fuel c ntaining a maximum 15 part:-per-million (ppm) suJfur. ,·uam current! · u:e dies I with 5,000 ppm sulfur.
Th use of D and d1e n " er chicle rechnology a::;sociar d with the fuel are scimat d m r uce annual emi sions b,· rem ,._ ing the p llution from more than 90 p rceot of today'. truck: and buses," hen the curr nt heavy-duty vehicle fl t ha. bec11 completely r placed in 2030.
ers of diesel fuel ha been hampe.rcd b • the lack of LSD on uam. B cau. e L: D was not required, commercial u.crs couJd not ucilizc nc-.: er. posr 2. 06, engine m d I. that could T.Y u 'D. ot o nly will bri.ngLSD to 'uam all " newer, post-2 6 n · m el. to be used on i. land, it will also reduce th amount of air pollutanr. b · ng emitred very c..b.y.
ln aclditi n to th tnm porr industry. 1 wlll also be used for stationary u. c applicaci n such as uam Power uth ciry generat r and other backup generators. Th use f 'T wil l reduce emi ion. from these g n rators - - - - - - - - - - - - - - - - - - - particularl "hen GP:\'s fast-track generator How will using ULSD help Guam? become used more frequencly in conjunction uring the recent year , many commercial us- with the military buildup.
A lthough tJ1crc v a already an e ·tabli. b.cd m vcment tn the market to bring L D ro G uam. 'uam Power Aut hority '.S. EP :\, Guam EP.\, and industry r prcsentativcs formed a working
gr up
to address :.. . E.P, 's concern with the I. for the propo. t.!d military buildup. This work-
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Table .of Contents- ·· :1 1
Background
2
Transition to ULSD in the U.S. Mainland
4
Background of ULSD and Public Law 30-184 oJune11,201 , Bill ' o. 414- (C R) wa · inrroduccd and proposed to odify uam' transtnon to 'L 'D. The 30•h Guam Lcgilarurc un:mtmously passed Bill4 14 o n ,\ugust 16 2010, ~hi h was subseL'ton< .\ s.,c.
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Donald u c .c ... ... > c .., 0 GJ IV GJ IV c. IV .., :::s :::s :::s GJ
ULS
Mixture ULSD 15 ppm
This graph di play one way of ttansitioning torage tanks from higher ulfur die el to U D. This is th method that one of the ULSD provide on Guam plan to u e to prepare for upplying only U Don ·land. Page 10
Is the infrastructure ready? Challenges transitioning to ULSD outlined by oil companies
Specification Issues
' e are ready to import and oon will be ready to di tribute only D."
- IP&E
(She/~
Management
One of the questions raised by the
content. It was clarified that Guam
working group was in regards to
fuel follows U.S. mainland specifica-
whether or not Guam's exemption
tions and the exemption does not
applied to all specifications outlined
necessarily apply to parts of the fuel
in the federal Clean Air Act or just
other than sulfur content.
the specifications referring to sulfur
"Our first shipment of D i planned to arrive in Guam on ovember 29 and it will take a fe months to complete the tran ition to ULSD.' -Mobil Management
Issue of mixed fuel
1
• One oil company on Guam raised • The company has made a suggesconcerns about Guam's law and tion about an addition to Guam's their ability to sell "interphase" law that would allow this fuel. (Diagram below) This fuel "interphase" fuel to be sold for would be created when changing Marine use. Many of the vessels fuel in the pipeline between jet using this interphase fuel would fuel and ULSD. Jet fuel has 3,000 be operating offshore, therefore ppm sulfur content. ULSD has 15 limiting the affect this mixed fuel ppm sulfur content. The fuel bewould have on the health of the tween the jet fuel and ULSD people of Guam. would be unsuitable for jet fuel • This is not a concern for the other and would have too much sulfur oil company on Guam. to be used in engines requiring 15 ppm or less sulfur.
Regular ULSD running through the single diesel piepline
Regular ULSD
For more information about Ultra Low Sulfur Diesel visit www.cleanairforguam.com
let fuel
Regular ULSD
Page 11
Impact to Diesel Supply for Guam? Do you have stable sources for ULSD in our region IP&E has stable ULSD sources. IP&E's supplier is contractual bound to provide the company with a reliable supply of ULSD. They do not anticipate any risk of ULSD not being available to IP&E based on our supplier's track record and their contractual obligations . As a prudent business exercise IP&E has identified alternative ULSD supply sources in the region.
....
"Yes."
Would thiJ include multiple JourceJ Jhouldyour primary .wurce not be able to JUpp!J? "Yes"
-Mobil
-IP&E
Would the transition to ULSD affect any of your current contracts? IP&E responded: "Public Law 30184 only addressed the sulfur specification of diesel fuel to be sold on Guam and did not address other important parts of a ULSD specification. For instance, when moving to ULSD it is common for the heating value of the diesel fuel to change. Heating values of diesel fuel are a negotiation driver between petroleum suppliers and public utilities. Public Law 30-184 only addressed the change of the sulfur specification and not the heating value and a few other important specification variances that naturally occur between 5,000 ppm sulfur diesel and ULSD. IP&E is working with Guam's power utility in seeking compensation for a theoretical loss in engine output due to a variance in heating values between 5,000 ppm and the lower sulfur products we have been providing.
A comprehensive review of the critical ULSD (m;ai!able in the region) specification components should take place and be adopted as a base specification; or legislation should be put in place guiding the utilities to accept the diesel specification available from local suppliers based on Public Law 30-184 broader 15 ppm sulfur call out."
Concerns raised Raised by SPPC: The biggest problem facing the future of SPPC under a ULSD ONLY environment is the handling of aviation fuel. SPPC does not have dedicated Aviation and diesel systems. Such sys tems were not required in the past. They would have been counter productive. Note- there iJ a recommendation on page 15 regarding thiJ com·ern.
For more information about Ultra Low Sulfur Diesel visit www.cleanairforguam.com
Concerns raised about long-term supply "SPPC does have concerns about the reliability of supply, not tomorrow, but perhaps 3 to 10 years into the future. Oil is known to be a diminishing resource. As we m ove forward there is a high likelihood that there will be periods o f shortage. At those times Guam will have no leverage compared with the demand from larger countries." "Since Singapore's refmed ULSD is primarily manufactured for the Australian market (Japan also uses ULSD), Guam will be competing against Australia for what then might well be scarce product. We consider such a situation to pose a moderate to high level of risk to Guam's supply reliability." "Singapore's own retail grade, and the more general Asian ULSD grade, is 50 ppm. It has a maximum level of 50 ppm and is likely to be more abundant." Page 12
Supply Would Guam's transition to ULSD have an impact on other markets in Micronesia? "In terms of the fuel supplies on the other islands, Mobil is working on several options to reduce the impact of the ULSD introduction in Guam (as known, Mobil uses Cabras terminal as a fuels redistribution center for the wider Micronesia). We also understand that the law allows import of high sulfur diesel for further export."
Mobil
•
ISSUeS
for the Region
Concerns raised by PPC SPPC does not supply the markets outside of Guam, however, the limitation imposed to sell only ULSD to the fishing fleet is a further burden on that particular market. It almost certainly will send the last of the fleet to open-ocean or unrestricted diesel markets. It is worth noting that ULSD limitations for marine are not mirrored within US EPA regulations for the mainland until at least December 1, 2014.
The impact would be "minimal."
IP&E
For more Information about Ultra Low Sulfur Diesel visit www.cleanalrforguam.com
Page 13
General Timeline What has been done so far? Task force meeting and work 2009
U.S. EPA calls ULSD task force together on Guam.
Aug. 16, 2010
Public Law 30-184 passed
Sept. 20, 2010
Task force meets
Oct. 5, 2010
Task force meets
Oct. 18, 2010
Task force meets
Nov. 4, 2010
Task Force meets
Nov. 10, 2010
Draft report created
Nov. 18, 2010
Draft report reviewed
Nov. 20, 2010
Final report created
Nov. 23, 2010
Final report reviewed
Dec. 1, 2010
Report submitted to Legislature Web site launched
Transition to ULSD Early 1990s
Law requiring ULSD passes Guam/rural Alaska granted exemptions
2006
U.S. mainland begins transitioning to using ULSD
2009
IP&E begins planning for transition to ULSD
Sept. 17, 2010
IP&E brings in first shipment of ULSD to Guam. Begins the transition from Low Sulfur Diesel in their tanks to ULSD.
Nov. 28, 2010
Mobil brings in first ULSD shipment
Jan. 1, 2011
All diesel unloaded on Guam must be ULSD as required by Public Law 30-184
Jan. 1, 2011
IP&E plans to have only USLD for distribution at all pumps across Guam.
Suggested Benchmark Dates
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