The California Air Resources Board (CARB) on Friday re-adopted a Low Carbon Fuel Standard (LCFS), which requires a 10% reduction by 2020 in the carbon intensity of transportation fuels.
“Today’s action builds on years of successful implementation and will continue reducing carbon emissions from the transportation sector. Transportation is the largest source of greenhouse gases in the state,” said Air Resources Board Chair Mary D. Nichols. “This program is a key element of California’s plans to enact Governor Brown’s Executive Order mandating a 50% cut in petroleum use by 2030.”
According to The New York Times, the state projects that fuel costs could rise 13 cents per gallon by 2020 as a result of the new standard. It adds that environmental groups, focused on advances in natural gas, biodiesel and the growing use of hybrid and electric cars in California, say the standard will not be difficult to meet.
CARB explains the LCFS is “an important tool in California’s efforts to reduce the impacts of climate change by spurring innovation in an array of cleaner fuels.” The program requires that transportation fuels used in California meet a baseline target for carbon intensity. That target is reduced each year. If a product is above the annual carbon intensity target, the fuel incurs deficits. If a product is below that target, the fuel generates credits which may be used later for compliance, or sold to other producers who have deficits. So far, fuel producers are over-complying with the regulation, according to CARB.
The decline in the LCFS carbon intensity targets was frozen due to a legal challenge, CARB said. According to the Times, the rule was originally approved by CARB in 2009, but fought by oil and gas companies. To address the court’s ruling, the board said it readopted the LCFS regulation following public testimony delivered recently at the first of a two-day board meeting.
The readopted version of the LCFS includes a number of modifications developed with stakeholder input. These include:
Incorporating additional cost containment in response to stakeholder concerns about possible price spikes by including a mechanism to cap LCFS credit prices;
Streamlining the application process for alternative fuel producers seeking a carbon intensity score;
Improving the process for earning LCFS credits by charging electric vehicles.
To view the amended regulation, click here.