Comments from the CARB Public Hearing on LCFS

·         Most commenters were strong supporters of the program.  CARB officials noted that while the program is still new, it appeared to be working well and they had confidence that next-generation fuels needed to meet future requirements would be developed.  The uncertainty of the availability of sufficient quantities of alternative fuels for 2015 and beyond was stressed by several speakers.  CARB officials acknowledged the concern and answered that they were confident that new sources would be developed to meet the demand.

·         Some changes were tentatively adopted (there will be a 15 day comment period prior to finalization)

o   A provision to allow exempted fuel providers who currently meet 2020 carbon intensity standards to opt out of the program.  Out of state fuel producers, intermediate fuel suppliers, and gas utilities would also have the ability to become regulated parties.  The definitions of “producer”, “importer” and “importer facility” are being revised to accommodate the opt in/out provisions.

o   Method 2A/2B Certification requirements are being streamlined for more expeditious reviews.

o   A new section has been added to provide details on credit trading, banking, and retirements.

o   Revisions were made to extend regulated party status to additional members of the electric vehicle community.

o   Energy Economy Ratios for heavy-duty vehicles burning CNG or LNG, light-duty battery electric vehicles, plug –in-hybrid electric vehicles, and light-duty fuel cell vehicles are being modified.  Also included are changes in how the EERs are used in LCFS calculations.

o   Reporting requirements are being modified and the requirement that all reporting must be done via the LCFS Reporting Tool has been added.

o   CARB staff reviewed several options for changing the High Carbon-Intensity Crude Oil (HCICO) portion of the regulations and offered their suggestion to the Board for adoption.  The proposal generated much comment from the refining community and resulted in a great deal of discussion between representatives for the refiners and Board and staff members.  This issue will be reviewed further during the 15 day comment period and further changes may be made during that time.

Weaver personnel asked for and were allowed a meeting with CARB staff responsible for creating the details of the Credit Trading regulations.  Among the items discussed were the extent of individual credit identification in both trading and banking, the role and requirements of brokers, current and future trading platforms, and the desired transformation to a fully automated system.  Weaver plans to maintain close communication with staff as these and other details are developed.  We will be active in assisting our clients in all phases of the LCFS program including credit trading.

For additional information or assistance with the regulations or credit trading please contact: