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REGULATION: Calif.’s pioneering low-carbon fuels rule could see multiple changes

California’s landmark law requiring lower-carbon fuels is poised for a rewrite.

Advisers to the state’s Air Resources Board yesterday detailed proposed revisions to the low-carbon fuel standard (LCFS), a first-in-the-nation regulation. Potential changes include allowing oil companies to earn program credits for making refinery upgrades that shrink greenhouse gas pollution.

That amendment would give businesses more options while still meeting goals of the program, ARB staff said. The projects also could lower the cost of complying with the state’s cap-and-trade program for carbon emissions, said Mike Waugh, chief of ARB’s transportation fuels branch.

“If you can reduce your GHG emissions at the refinery itself, you reduce your obligation under cap and trade, but legitimately, you reduce your emissions and your life cycle for the LCFS,” Waugh said. “So you can do something that benefits both programs.”

Representatives from oil companies, alternative fuels manufacturers, environmental groups and health associations crowded into a meeting room in Sacramento to hear about the changes. It became so packed that it violated a fire code limit of 90 people, forcing many to relocate to another site where they watched remotely.

Revisions to LCFS would go before the board for a vote later this year. Agency staff is recommending that ARB readopt the regulation, which was first approved in 2009. It’s one of several rules rolled out after passage of the states’ 2006 climate law, A.B. 32. Transportation accounts for about 40 percent of California’s greenhouse gas emissions.

The proposed LCFS rewrite follows a 5th District Court of Appeal ruling that ARB when it approved the fuels law violated the California Environmental Quality Act (CEQA) and the state Administrative Procedures Act (APA). The court last summer said that the agency could continue to enforce LCFS while it worked to rectify the issues (ClimateWire, July 16, 2013).

The LCFS aims to cut the carbon content of fuels sold in California 10 percent by 2020. To meet that goal, a fuel blender must keep the average carbon intensity (or CI) in its total volume produced below an annual limit set by ARB. The mandate is frozen at 1 percent reduction because of the court ruling.

Source:  http://www.eenews.net/stories/1059995992 

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