Low-carbon fuel standard

A low-carbon fuel standard (LCFS) is an emissions trading rule designed to reduce the average carbon intensity of transportation fuels in a given jurisdiction, as compared to conventional petroleum fuels, such as gasoline and diesel. The most common methods for reducing transportation carbon emissions are supplying electricity to electric vehicles, supplying hydrogen fuel to fuel cell vehicles and blending biofuels, such as ethanol, biodiesel, renewable diesel, and renewable natural gas into fossil fuels. The main purpose of a low-carbon fuel standard is to decrease carbon dioxide emissions associated with vehicles powered by various types of internal combustion engines while also considering the entire life cycle ("well to wheels"), in order to reduce the carbon footprint of transportation. The first low-carbon fuel standard mandate in the world was enacted by California in 2007, with specific eligibility criteria defined by the California Air Resources Board (CARB) in April 2009 but taking effect in January 2011. Similar legislation was approved in British Columbia in April 2008, and by European Union which proposed its legislation in January 2007 and which was adopted in December 2008. The United Kingdom is implementing its Renewable Transport Fuel Obligation Program, which also applies the concept of low-carbon fuels. Several bills have been proposed in the United States for similar low-carbon fuel regulation at a national level but with less stringent standards than California. As of early 2010 none have been approved. The U.S. Environmental Protection Agency (EPA) issued its final rule regarding the expanded Renewable Fuel Standard (RFS2) for 2010 and beyond on February 3, 2010. This ruling, as mandated by the Energy Independence and Security Act of 2007 (EISA), included direct emissions and significant indirect emissions from land use changes.

California Low-Carbon Fuel Standard Californian Governor Arnold Schwarzenegger issued Executive Order S-1-07 on January 19, 2007, to enact a low-carbon fuel standard (LCFS). The LCFS requires oil refineries and distributors to ensure that the mix of fuel they sell in the Californian market meets the established declining targets for greenhouse gas (GHG) emissions measured in CO2-equivalent grams per unit of fuel energy sold for transport purposes. The LCFS directive calls for a reduction of at least 10 percent in the carbon intensity of California's transportation fuels by 2020. These reductions include not only tailpipe emissions but also all other associated emissions from production, distribution and use of transport fuels within the state. Therefore, California LCFS considers the fuel's full life cycle, also known as the "well to wheels" or "seed to wheels" efficiency of transport fuels. The standard is also aimed to reduce the state's dependence on petroleum, create a market for clean transportation technology, and stimulate the production and use of alternative, low-carbon fuels in California. There have been efforts to change the intensity measurement model from the CARB GREET model to the Argonne GREET model in order to more fully capture the carbon intensity impact of the fuels. The LCFS is a mix of command and control regulation and emissions trading, as it will use market-based mechanisms that allow providers to choose how they will reduce emissions while responding to consumer demand. Some believe that oil companies could opt for several actions to comply. For example, they state that refiners and producers could improve the efficiency of the refineries and upstream production, or may purchase and blend more low-carbon ethanol into gasoline products, or purchase credits from electric utilities supplying low carbon electrons to electric passenger vehicles, or diversifying and selling low carbon hydrogen for use by vehicles as a product, or any new strategy as the standard is being designed. The California Global Warming Solutions Act of 2006 authorized the establishment of emissions trading in California, with rules to be adopted by 2010, and taking effect no later than January 2012.

Regulatory proceedings In accordance to the California Global Warming Solutions Act of 2006 and the Governor's Directive, the California Air Resources Board is the agency responsible for developing the "Low-Carbon Fuel Standard Program", and it was directed to initiate the regulatory proceedings to establish and implement the LCFS." CARB identified the LCFS as an early action item with a regulation to be adopted and implemented by 2010. Also Executive Order S-1-07 ordered the California Environmental Protection Agency to coordinate activities between the University of California, the California Energy Commission and other state agencies to develop and propose a draft compliance schedule to meet the 2020 target. As mandated by the Executive Order, a University of California team, led by Daniel Sperling of UC Davis and the late Alexander E. Farrell (UC Berkeley), developed two reports that established the technical feasibility of an LCFS, proposed the methodology to calculate the full life cycle GHG emissions from all fuels sold in the state, identified technical and policy issues, and provided a number of specific recommendations, thus providing an initial framework for the development of CARB's LCFS. This study was presented by Governor Schwarzenegger in May 2007 and they were the backbone of CARB's initial efforts to develop the LCFS, even though not all of the specific recommendations were incorporated in the final LCFS staff's proposed regulation.

Public consultation process During 2008 and until the April 2009 LCFS ruling, CARB published in its website all technical reports prepared by its staff and collaborators regarding the definition and calculations related to the proposed LCFS regulation, conducted 16 public workshops, and also submitted its studies for external peer review. Before the April 23, 2009 ruling, the Board held a 45-day public hearing that received 229 comments, 21 of which were presented during the Board Hearing.

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