Calif. Demands 10% Carbon Cut in Transportation Fuels by 2020

This story appears in the May 4 print edition of Transport Topics.

California environmental regulators have approved a new standard that will require a 10% reduction in the carbon content of transportation fuels by 2020 and encourage a transition to nonpetroleum-based fuels.

The California Air Resources Board adopted the low-carbon fuel standard April 23. It is aimed at fuel producers, refiners and blenders and is intended not only to reduce greenhouse gas emissions from cars and trucks and U.S. dependence on foreign oil but also to encourage the use of electric and natural gas vehicles and the development of new fuels to replace corn-based ethanol.

Plans call for the regulation to begin taking effect in 2012, reaching the 10% carbon intensity reduction by 2020. The standard is “backloaded” in that more reductions are required in the last five years than the first five years.

“The drive to force the market toward greater use of alternative fuels will be a boon to the state’ economy and public health: It reduces air pollution, creates new jobs and continues California’s leadership in the fight against global warming,” said CARB Chairwoman Mary Nichols.

While the CARB board of directors approved the measure in an 8-1 vote, dozens of speakers at a daylong public hearing preceding the vote were sharply divided.

Nichols said the public hearing was a “really good short course” into why nothing has been done in many years to change the fuel supply in the United States. “The dissonance and the division couldn’t have been more clearly illustrated,” Nichols said.

Truckers expressed concern that the low-carbon fuel will cost too much; ethanol producers complained that the new standard unfairly overstates the economic effects of using food crops for fuel; and cattlemen argued that using corn for ethanol has increased their feed costs.

California’s new standards “will increase costs for consumers of transportation fuels,” Richard Moskowitz, vice president and regulatory affairs counsel for American Trucking Associations, told Transport Topics. “Unfortunately, this will have an adverse impact upon trucking companies, who are the largest consumers of diesel fuel.”

Moskowitz said CARB should be taking a nationally-coordinated approach to reducing carbon emissions.

“It’s difficult to predict what the impact on greenhouse gases will be, because California is pursuing this regulation without coordinating with the rest of the country,” Moskowitz said. “California’s rule may force low-carbon fuels that are produced in other states to be transported into California rather than consumed locally. This could actually increase the total amount of carbon emissions.”

CARB officials said they have been working with officials of the U.S. Environmental Protection Agency and the European Union with the hope of eventually setting a common national and international standard.

While the new regulation has not faced stiff opposition from many in the oil industry, some fuel producers had been seeking delays because of questions about land-use and the current state of the science used to measure the carbon footprint of all fuels.

Although there are currently no transportation fuels that would meet the new standard, CARB officials said they were confident such fuels can be developed. They said studies by University of California researchers provided the initial framework for the standard and established the regulation’s technical feasibility.

CARB officials said the standard will reduce greenhouse gas emissions from the transportation sector in California by about 16 million metric tons in 2020.

According to a CARB analysis, the new regulation also will create a need for more than 1.5 billion gallons of biofuels, require 25 new biofuel facilities to be built, and generate 3,000 new jobs, mostly in the state’s rural areas.

Lee Hobbs, director of operations for Hobbs Trucking, Anaheim, Calif., said the low-carbon fuel standard was just another blow to the heavy trucking industry, which already faces a host of mandatory state requirements to reduce diesel emissions through retrofits and new trucks and to improve fuel efficiency by reducing aerodynamic drag. 

Hobbs said he was concerned that the new standard would raise fuel costs and that CARB set a new standard even though there are no fuels now that would meet it.

“They just pass a law and try to make it work,” Hobbs told TT. “Sometimes it works, and sometimes it doesn’t.”

But most CARB board members said the new carbon standard is forward-looking and will send a message to oil producers that the future rests in alternative fuels.

“This is an example of government at its best,” said board member Daniel Sperling. “It’s science-based, uses a single metric and a good process and doesn’t pick a winner. I think we’ve got something here that really will work.”