24 April 2009

The California Air Resources Board (ARB) adopted a regulation that will implement the Low Carbon Fuel Standard (LCFS), calling for the reduction of greenhouse gas emissions from California's transportation fuels by 10% by 2020.

The new regulation will boost the market for alternative fuel vehicles and achieve 16 million metric tons of greenhouse gas emission reductions by 2020, said ARB. The measure is the most important early action called for under AB 32, the Global Warming Solutions Act (Nunez, 2006).

The regulation requires providers, refiners, importers and blenders to ensure that the fuels they provide for the California market meet an average declining standard of “carbon intensity”. This is established by determining the sum of greenhouse gas emissions associated with the production, transportation and consumption of a fuel, also referred to as the “fuel pathway”.

The carbon intensity calculation in the finalized regulation also includes the indirect land use change (ILUC) effects, that account for the release of additional greenhouse gas emissions through the conversion of forest lands and other carbon-containing habitats. However, the ILUC effects are calculated from a model that is based on many assumptions. The biofuels industry generally opposed the indirect effects provisions, fearing that they will assign higher carbon intensity to several agricultural biofuels, such as corn ethanol.

The ARB expects that new low carbon fuels will be generated from such feedstocks as algae, wood, agricultural waste such as straw, common invasive weeds such as switchgrass, and from municipal solid waste. The standard is also expected to drive the availability of plug-in hybrid, battery electric and fuel-cell powered cars while promoting investment in electric charging stations and hydrogen fueling stations.

California will be providing funding to assist in the early development of the most promising low-carbon fuels. The Alternative and Renewable Fuel and Vehicle Technology Program, AB 118 (Nunez, 2007), managed by the California Energy Commission, will provide approximately $120 million per year over seven years to deploy the cleanest fuels and vehicles.

Governor Schwarzenegger issued the executive order requiring a low carbon fuel standard in early 2007. The proposed LCFS regulation was released in March 2009.

Source: California ARB