For any city, county, or regional agency source reduction and recycling element submitted to the department after January 1, 1995, the 50 percent diversion requirement specified in paragraph (2) of subdivision (a) of Section 41780 may include not more than 10 percent through biomass conversion if all of the following conditions are met:
(a) The biomass conversion project exclusively processes biomass.
(b) The biomass conversion project is in compliance with all applicable air quality laws, rules, and regulations.
(c) The ash or other residue from the biomass conversion project is regularly tested to determine if it is hazardous waste and, if it is determined to be hazardous waste, the ash or other residue is sent to a class 1 hazardous waste disposal facility.
(d) The department determines, at a public hearing, based upon substantial evidence in the record, that the city, county, or regional agency is, and will continue to be, effectively implementing all feasible source reduction, recycling, and composting measures.
(e) The city, county, or regional agency does not include transformation in its source reduction and recycling element.