Issue of the Day: California Adopts New Regulation Ahead of Summit
Project America - Issue of the Day: California Adopts New Regulation Ahead of Summit

Published Monday, April 27th, 2009

Governor Schwarzenegger’s Low Carbon Fuel Standard, which calls for a 10% reduction of greenhouse gas emissions by 2020, has been adopted by California’s Air Resources Board. According to the Board, the regulation aims to increase the market for alternative-fuel vehicles and achieve 16 million metric tons of greenhouse gas emission reductions by 2020. This is a regulation under California’s Global Warming Solutions Act. The regulation means that fuel providers must prove that their California fuels meet an average declining standard of “Carbon Intensity.” Intensity is a figure related to the sum of greenhouse gas emissions associated with the production, transportation and consumption of a specific fuel. California’s regulation efforts have come under fire from those who claim the new regulation will indirectly affect land use changes that further inflate grain prices and reduce forests. This move comes ahead of the Major Economies Forum on Energy and Climate, to which President Obama has invited the 16 states with the highest emissions of greenhouse gases.

The total summary of on-road alternative fuel and hybrid vehicles has Ethanol (E85) far surpassing all other fuels, which have remained flat (Compressed Natural Gas, Liquefied Natural Gas, and Hydrogen) or have reduced (Liquefied Petroleum Gas). The price of a bushel of wheat, a growing Alternative Fuel ingredient, has skyrocketed from $3.42 in 2005 to $6.65 in 2007. A bushel of corn, the main ingredient in ethanol, has also doubled from $2.00 in 2005 to $4.00 in 2007.

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