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Schwarzenegger Establishes Low Carbon Fuel Standard in California

January 10, 2007

California Gov. Arnold Schwarzenegger announced this week he will issue an Executive Order establishing a Low Carbon Fuel Standard (LCFS) for transportation fuels sold in the state. By 2020 the standard will reduce the carbon content of California's passenger vehicle fuels by at least 10 percent, supporting the emissions targets laid out in AB 32 signed into law earlier this year as part of California's overall strategy to fight global warming. The LCFS requires fuel providers to ensure that the mix of fuel they sell into the California market meets, on average, a declining standard for greenhouse gas emissions measured in CO2-equivalent gram per unit of fuel energy sold. The LCFS will use market-based mechanisms that allow providers to choose how they reduce emissions while responding to consumer demand. For example, providers may purchase and blend more low-carbon ethanol into gasoline products, purchase credits from electric utilities supplying low carbon electrons to electric passenger vehicles, diversify into low carbon hydrogen as a product or adopt new strategies yet to be developed.The California Air Resources Board (ARB), in partnership with other agencies, will develop the LCFS protocols for adoption as an early action no later than June 2007. It is expected that the regulatory process at ARB to implement the new standard will be completed no later than December 2008.
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