Renewable fuels industry urges Californian lawmakers to back low carbon fuel standard

Around 60 producers and providers of clean fuels – ranging from electricity to biofuels – signed a joint letter urging state policymakers to sustain California’s low carbon fuel policy.

The industry leaders say the tool is a “critical” part of the plan to reduce California’s greenhouse gases and that it is already driving in-state investment.

Biofuel stakeholders that have signed the letter include Aemetis, California Biodiesel Alliance, the National Biodiesel Board and Low Carbon Fuels Coalition.

The companies backing the state’s Low Carbon Fuel Standard (LCFS) and signing the letter range from the state’s largest natural gas utility to a company providing electric vehicle chargers to companies producing biodiesel in California.

All of these businesses and fuel providers indicate that the LCFS is working as planned and encouraging the production of cost-effective, cleaner, lower carbon fuels. 

The LCFS calls for reducing the carbon intensity of transportation fuels 10% by 2020. The measure was developed and enacted as a result of an Executive Order issued by former California Governor Schwarzenegger.

A legal challenge resulted in a significant delay in the implementation of the policy but since the Air Resources Board re-adopted the policy in 2015, it has been driving investment and innovation.  

A wide array of firms and companies are responding to the LCFS and producing enough fuels to meet the regulation’s requirements.

‘Real monetary value’

According to the firms backing LCFS, the LCFS has helped encourage the growth of the California biofuel industry, and is also providing real monetary value for fleets using electricity and natural gas. Thus far, since being implemented, the LCFS has helped encouraged more than $650 million in investment in clean fuel production in California.  

The letter states: “The LCFS is good policy. It doesn’t favor one fuel over another, but instead, it creates incentives that encourage businesses to produce a suite of clean fuels including biodiesel, biomethane, electricity, ethanol, hydrogen, next generation biofuels, renewable natural gas, and more.”

“The more than 50 fuel producers and providers that signed this letter strongly back this policy because they know it is driving innovation and investment, and will lead California to a better transportation future,” said CALSTART President and CEO, John Boesel.

“The LCFS program is driving investment and innovation in our industry. Incentives to generate renewable fuels enable us to develop new low carbon fuel projects in California – which is good for the economy and good for the environment,” said George Minter, Vice President for External Affairs and Environmental Strategy at the Southern California Gas Company. 

The letter states that the LCFS is a good public policy because it sets a target but it does not pick technologies. The marketplace is responding with a number of different approaches.

According to Lisa Mortensen, CEO of Community Fuels, “The LCFS is well-crafted and it is working as intended.  More low carbon fuels are being integrated into the state’s fuel supply than ever before.  If policymakers support the LCFS and provide clear indications that it will be stable, the marketplace will provide more than enough low carbon fuels to meet LCFS targets.”