Oregon Takes Big Step on Clean Fuels Program, but Corn Ethanol Concession Needs to be Cut

Oregon's Environmental Quality Commission voted unanimously today to changes that will extend the state's Clean Fuels Program (CFP) to 2025. The new fuel standard requires the oil industry to reduce the carbon-intensity of transportation fuels by 10% by 2025 compared to 2015 through greater use of lower carbon alternatives including clean electricity, biogas, and advanced biofuels. Earlier this year, Governor Kate Brown signed SB324 which lifted a previous legislative sunset on the state's CFP -- allowing the program to continue beyond 2015 -- while also establishing the 10% reduction level for 2025.

West coast to oil industry: time to transition to cleaner fuel sources

Oregon's adoption of the new standards sends a clear message that the state will push forward on clean energy policies, despite record-breaking spending by the oil industry lobby to stop it. The supply of cleaner, lower-carbon fuels will grow when the program effectively restarts on January 1st of 2016.

By extending the program, Oregon is helping create one of the world's largest regional markets for low-carbon fuels together with similar programs in California and British Columbia. This also comes after announcements in Paris at the climate negotiations around Oregon's commitment, with thirteen other jurisdictions, to electric-drive vehicles, as I blogged on earlier.

Land use change concession to corn ethanol industry needs to be cut

While Oregon is going forward with a strong structure with the Clean Fuels Program, which even accounts for high-carbon intensity crude oils such as tar sands, the corn ethanol industry pushed through an 11th hour weakening on the land use accounting side for its industry. The Department of Environmental Quality (DEQ) should correct this weak accounting going forward. At the hearing, DEQ Administrator Dick Pederson voiced support for the agency to continue to review this issue going forward.

The use of biomass to produce fuels has long been known to potentially increase or decrease greenhouse gas emissions depending on changes in land use and soil carbon. The structure of the Clean Fuels Program requires that full lifecycle accounting of greenhouse gas emissions, including direct and indirect land use change, be included in assessing how to score various fuels. To capture the land use effects, Oregon chose to use well-vetted and peer reviewed values the California Air Resources Board (ARB) uses under its Low Carbon Fuel Standard for biofuels such as sugarcane ethanol, soy biodiesel, canola, and high-carbon intensity biofuels like palm oil. Those values have been developed through a transparent, consultative process including use of expert review panels.

But pressure by the corn ethanol industry, including its warning of a lawsuit if the state adopted California's more conservative values, resulted in DEQ adopting an entirely different model and land use change value favored by the industry. The land use change value for corn ethanol, more than halved, now sticks out like a sore thumb. The effects of these changes will be a weakened signal for advanced, sustainable biofuels that avoid competition with food production.

In California, the corn ethanol industry's lawsuit against California's program has failed at nearly every turn. A judge also threw out the oil industry's lawsuit in Oregon earlier this year. Oregon should send a clear signal that the legal threats won't work, and should strengthen and harmonize its land use change accounting approach with California for corn ethanol next year. As various organizations, including NRDC, Union of Concerned Scientists, and International Council on Clean Transportation have all put on the public record, Oregon is on more solid ground to adopt consistent, stronger land use change values.

Oregon will benefit from a strong Clean Fuels Program

As Oregon looks to further improve and implement its Clean Fuels Program, the state is set to attract and grow clean energy businesses and jobs, cut the state's need for petroleum, and creating a healthier future for its citizens. Today's vote was a big step toward making dirty, pollution energy sources a thing of the past, and making a cleaner energy future a reality.

About the Authors

Simon Mui

Director, California Vehicles and Fuels, Energy & Transportation program

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