SACRAMENTO - The Air Resources Board today re-adopted a Low Carbon Fuel Standard (LCFS), which requires a 10 percent reduction by 2020 in the carbon intensity of transportation fuels. The LCFS, a pillar supporting the state’s efforts to fight climate change, delivers more clean fuels for Californians, and reduces emissions of greenhouse gases and other air pollutants.

“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 percent cut in petroleum use by 2030.” 

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.

Carbon intensity is determined through a life cycle analysis measuring the amount of carbon generated during the extraction, production, transportation, and combustion of a fuel. The LCFS does not require use of any specific fuel, only that regulated parties find a blend of fuels and credits that will meet the declining target each year.

The LCFS is a pillar supporting California’s effort to reduce greenhouse gas emissions in accordance with AB 32’s 2020 target and to achieve further reductions beyond that.  The regulation is also intended to spur innovation in transportation fuels and to reduce California’s dependence on petroleum.

The decline in the LCFS carbon intensity targets was frozen due to a legal challenge. To address the court’s ruling and to strengthen the program, the Air Resources Board readopted the LCFS regulation following public testimony delivered yesterday 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.

Alternative Diesel Fuels

The Board today also adopted a regulation governing alternative diesel fuels (ADF). The regulation puts in place a three-step process beginning in 2016 to create a path to bring cleaner diesel substitutes into the market. This regulation also establishes requirements and fuel specifications for biodiesel to ensure the emissions of nitrogen oxides (NOx) from biodiesel use will not increase, and will be reduced over time.  Biodiesel and other ADFs can help producers achieve their target under the LCFS.

Other programs that will result in a decreased use of petroleum while helping achieve the 40 percent reduction of greenhouse gases by 2030 as called for by Governor Brown include the advanced clean car regulations that deliver greater fuel efficiency, the zero-emission vehicle mandate putting more electric and hydrogen powered cars on the streets, and the State's efforts under SB 375 to develop more livable, walkable communities and improve public transit.

California’s greenhouse gas reduction programs achieve additional benefits. For example, the reduction of greenhouse gases as a result of reduced petroleum use often coincides with reductions of air pollutants that increase the severity of asthma and cardiovascular disease, and ultimately cost Californians their lives.  

To view the amended LCFS and ADF regulation, click here.