Air Board Adopts Major Changes to Low Carbon Fuel Standard

The California Air Resources Board (CARB) made significant changes to the Low Carbon Fuel Standard. After more than two years of back and forth, CARB adopted several major changes to the state’s Low Carbon Fuel Standard. On the positive side, CARB adopted more stringent carbon reductions between 2025 and 2030, including interim targets and an overall 30 percent reduction in the carbon intensity of fuels on the road by 2030. These targets should stimulate faster growth in the production of low carbon fuels, including biomethane, electricity and hydrogen generated from organic waste.

CARB also adopted several more controversial changes, including the phase-out of credit for avoided methane emissions. This makes sense, and is consistent with established carbon accounting practices, when methane reductions are required by law, but the change to the LCFS goes beyond methane reductions that are required by law to include all methane reductions, even those that are voluntary or in excess of legal requirements. Fortunately, there is a multi-year phase-out, but this change will gradually reduce the value of biofuels from organic waste that participate in the LCFS program.

CARB also made changes to eventually phase in a delivery requirement for out of state fuels so that California drivers do not pay for fuels that are never delivered to California. The current LCFS rules allow “book and claim” for biomethane that is injected into a pipeline anywhere in the U.S., whether or not that biomethane is ever actually delivered to California. Allowing undelivered fuels to compete with fuels that are produced and actually used in California sets up a very unlevel playing field and hurts instate projects that are helping to meet the waste diversion, wildfire mitigation and other requirements in California.

The LCFS revisions contain many other changes as well. To see the final package of LCFS regulations adopted in November, click here.