Status Review of California's Low Carbon Fuel Standard - Spring 2013 (Revised Version)

Abstract

The Low Carbon Fuel Standard (LCFS) is a performance-based regulation adopted in California in 2009 that requires regulated parties (e.g., oil producers and importers to California) to reduce the carbon intensity (CI) of their fuel mix by at least 10% by 2020. It sets declining annual targets, starting slowly with a 0.25% reduction in 2011 and increasing to 10% reduction by 2020. This regulation contributes to California’s overall greenhouse gas (GHG) emission reduction goals under the Global Warming Solutions Act of 2006 (AB 32).

This is the second in a series of periodic status reports of California’s LCFS. Each report will provide updates on LCFS compliance and markets, and address selected special topics. The reports review data, analyze trends, and identify potential challenges, but avoid making predictions. This second report addresses the following topics: Credits and deficits; Carbon intensity of fuels; Credit trading and credit prices; Federal Renewable Fuel Standard (RFS2) and implications for LCFS feedstocks; Issues that affect compliance (special topic).

Keywords: low carbon fuels, ethanol, transportation, climate policy, energy policy