The California LCFS and Ethanol: A Decade of Reducing Greenhouse Gas Emissions


The California Global Warming Solutions Act of 2006 (Assembly Bill 32) established the first-ever Low Carbon Fuel Standard (or “LCFS”). The objective of the program was to reduce greenhouse gas emissions from the state’s transportation sector, while also lessening dependence on petroleum.

The LCFS achieves GHG reductions by requiring individual fuel producers and distributors to annually reduce the average lifecycle carbon intensity (“CI”) of the fuels they supply to the market. Fuels with CI values below the annual standard set by the California Air Resources Board (CARB) generate compliance credits, while fuels with CI values above the standard generate compliance deficits. Regulated parties are in compliance with the annual standards when their credits offset or exceed their deficits.


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Bill to expand, extend 45Q tax credit introduced in House

Reps. David Schweikert, R-Ariz.; Brad Wenstrup, R-Ohio; and Carol Miller, R-W.V., on April 19 joined House Minority Leader Kevin McCarthy, R-Calif., in announcing a bill to improve and extend the 45Q tax credit for carbon capture and sequestration (CCS).

The bill, H.R. 2633, was introduced April 16 and referred to the House Committee on Ways and Means.

The bill aims to make the 45Q tax credit permanent. It would also increase the value of the credit from $35 to $50 per ton for carbon sequestered as part of enhanced oil and gas recovery. For other sequestered carbon, the value would increase from $50 to $85 per ton.

– Ethanol Producer Magazine, Erin Voegele

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Research shows E30 is safe for long-term use in non-FFVs

Nebraska Gov. Pete Ricketts on March 8 announced that ground-breaking research conducted by the University of Nebraska-Lincoln with support from the Nebraska Department of Administrative Services clearly demonstrates that E30 is safe for long-term use in non-flex fuel vehicles (FFVs).

“The research partnership between the State and the University clearly demonstrates that E30 is a safe and reliable fuel for vehicles,” Ricketts said. “Ethanol saves drivers money at the pump, is good for air quality, and creates opportunities for our farm families. This study will be a great aid as we advocate for growing the volume of E30 in our nation’s fuel supply. In turn, raising demand for E30 biofuel will benefit Nebraska’s corn growers who supply 35 percent of their crop to our state’s ethanol industry.”

– Ethanol Producer Magazine, Erin Voegele

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Embracing Alcohol-based Fuels as the Key to Decarbonizing Long-Haul Trucking

Automobile manufacturers such as Nissan, Chevy, Tesla, BYD, and others have successfully elevated battery-powered electric cars, vans, and even buses from being niche, expensive, and poor-performing transportation solutions to becoming mainstream and affordable with marked improvements in performance and range. But a BloombergNEF forecast shows that the 2040 market penetration of these EVs remains a relatively small proportion of the overall fleet, especially for heavy commercial vehicles. To meet our greenhouse gas mitigation goals and impending state and national emissions regulations, we need new solutions to road and other highly polluting segments of the transportation sector – air, ocean, and rail transport, for example – where economic and performance traction of clean fuels are critically lagging.

One sub-segment of the transportation sector that is especially difficult to decarbonize are those that rely on heavy-duty diesel engines. According to the 2014 ICCT State of Clean Transport Policy report, heavy-duty on-road vehicles emit 3 GtCO2e per year globally, accounting for 34 percent of transportation sector emissions and 8 percent of the 38 GtCO2e of global anthropogenic emissions. Diesel-fired long-haul trucks, which are used for cross-country and long-distance ground shipping, make up an overwhelming portion of these emissions.

– By Peter Sopher, Senior Associate at Clean Energy Ventures, Special to The Biofuels Digest

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Court decision casts doubt on dozens of U.S. refinery biofuel waivers

(Reuters) – A U.S. court decision last week striking down three biofuel waivers that the Environmental Protection Agency gave oil refineries in 2017 has cast doubt on the legitimacy of dozens of other EPA exemptions granted under similar circumstances, according to industry experts and agency data.

That spells uncertainty for a handful of independent refiners that secured lucrative waivers from the Trump administration, and could fire up prices for the biofuel blending credits those facilities need to comply with the nation’s biofuel law.

“The potential ramifications are huge,” said James Stock, an economist and professor at Harvard University who has researched biofuel policy.

– Richard Valdmanis, Reuters

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Life Cycle Associates Report: GHG Emissions Reductions due to the RFS2 A 2018 Update

“The expanded Renewable Fuel Standard (RFS2) has resulted in aggregate GHG emissions reductions from the use of biofuels, which exceed the original projections from the Environmental Protection Agency’s (EPA) final rule for the first 10 years of its implementation. The RFS2 has resulted in significant GHG reductions, with cumulative CO2 savings of nearly 600 million metric tonnes over the period of implementation. The GHG reductions are due to the greater than expected savings from ethanol and other biofuels. These emissions savings occur even though cellulosic biofuels have not met the RFS2 production targets. In addition, EPA underestimated the petroleum baseline in the Rule. Studies by Life Cycle Associates and the Carnegie Institute have shown that the GHG emissions from U.S. petroleum are higher than the EPA calculated in 2005 (Boland, 2014; Gordon, 2012, 2015). This study calculates the annual U.S. petroleum GHG intensity based on the changing trends in feedstock availability over time and determines the GHG savings calculated from the aggregate mix of renewable fuels. The GHG intensity for each category of ethanol plant and biodiesel feedstock is estimated for the resource mix over the past 11 years and combined to determine an aggregate estimate. Figure 1 shows the total emissions reductions from the RFS2 compared with the GHG reductions projected from the rule.”

– Life Cycle Associates: GHG Emissions Reductions due to the RFS2 A 2018 Update

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Court of Appeals rules in favor of California’s Low Carbon Fuel Standard

In California, the Ninth Circuit Court of Appeals issued a decisive ruling upholding California’s Low Carbon Fuel Standard – the state’s landmark program to reduce climate pollution from the fuel used in cars and trucks.

The court sided with California on all issues in the case, dismissed challenges to the Low Carbon Fuel Standard on numerous grounds, and awarded attorneys’ fees to the state.

“This is a thorough victory for the climate and for the health and safety of Californians,” said Tim O’Connor, Senior Director of California Energy Policy for Environmental Defense Fund, which was a party to the case. “California is working hard to address the dangers of air pollution, including climate pollution, from cars and trucks. Today the court affirmed California’s right to develop regulations that can help with that critical work, and can provide cleaner and healthier air for families and communities around the state.”

– Meghan Sapp, Biofuels Digest

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Investment linked US visa programme extended to September end, likely to see rush of new applicants

“MUMBAI: As expected, the EB-5 visa programme has been extended for six months, up to September 30, 2018. This extension is part of the spending bill, funding the US federal government, which was passed by the US Parliament and signed by President Trump.

As this is a mere extension and not an amendment to the EB-5 programme, various proposals such as an increased investment limit for the visa applicants is not included. Thus, applicants can continue to invest at the current lower norms.

According to immigration experts, the extension may see a sudden rush of applicants who want to beat any proposed reforms.”

– Lubna Kably, Times of India

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