Governor Kate Brown signed an executive order on Tuesday, March 10 that will expand and intensify Oregon’s Clean Fuels Program, also known as the low carbon fuel standard. This program is designed to reduce Oregon’s greenhouse gas emissions; more specifically, it seeks to lessen the “lifecycle carbon intensity” of fuels produced by the state.
History of the program: This program was initially passed in 2009 and took effect in 2015. The plan has faced criticism for its potential to increase gas prices, inefficiency and supposed unlawfulness, and possibility to leave Oregon at an economic disadvantage when compared to nearby states. Four years later, the Clean Fuels Program has hardly affected gas prices, but Oregon is still short of reaching its emission reduction goals, specifically in the sphere of transportation.
New expansion of this program: Doubling Oregon’s original goal with plans to reduce the state’s carbon intensity 20% below 2015 levels by 2030 and 25% below that by 2035, makes it the strongest, most assertive goal in the country. To do this, the state will need to utilize cleaner fuels like ethanol, biodiesel, renewable diesel, electricity, propane, compressed natural gas, renewable natural gas, and eventually hydrogen.
Program penalizes dirtier fuels: In order to accomplish this, Oregon will be punishing distributors who sell dirty oil and rewarding those who sell clean oil. In addition, it will use incentives so that oil companies are more likely to invest in more efficient equipment and use more lower-carbon fuels in their products. Essentially, distributors of dirtier fuels will have to buy credits.
This low carbon fuel standard is only one part of a much larger solution. Another smaller fix includes encouraging people to invest in electric cars by making more of them and installing more charging stations across the state. Some of the dollars from the credits will be used to achieve these goals.
More recently, the 2019 standard was 2.5% below 2015 levels, which is far from the existing goal of reducing carbon intensity by 10% below 2015 levels by 2025. This means that fuel importers are going to have to work hard to make up the difference in the next six years.