California expected to approve Low Carbon Fuel Standard; once the hope of biofuels, now the savior of petroleum courtesy of Indirect Land Use Change analysis

In California, the state Air Resources Board is expected today to approve the Low Carbon Fuel Standard.

Commencing in 2011, the Standard will progressively lower the carbon intensity of fuels, and will include a penalty on indirect land use change.

The standard will require a 10 percent reduction in the carbon intensity of fuels by 2020. Corn ethanol and to a lesser degree cellulosic ethanol is at great risk under the proposal, and Canadian producers of fuel from tar sands are also facing difficulty in meeting the standard.

SF Gate is reporting that estimates of the cost of the Standard’s deployment range from an $11 billion savings suggested by the ARB, and up to $3.7 billion in cost by critics of the Standard.

A perceptive set of recommendations from Brent Erickson of BIO can be viewed here.

Erickson said in part: “The Board should direct its staff to continue soliciting input from all stakeholders and from the scientific community on appropriate ILUC modeling and reliable data sources, without any fixed commitment to GTAP or the parameters used in GTAP, for a period of up to 2 years….Next time, peer reviews should be completed and posted for public comment before the public comment period on the proposed regulations begins…During the period in which ILUC methodologies are finalized in California, the LCFS regulations should be implemented without ILUC penalties.”

BIO also released “Sustainable Biofuels: a commonsense perspective on California’s approach to biofuels and global land use,” by industry consultant Jack Sheehan, which can be downloaded here. Sheehan wrote:

“The declining land clearing debt estimates in CARB’s GTAP analysis relative to the ?rst published estimates by Searchinger in 2008 re?ect progress being made in the re?nement of the estimates of iLUC impacts, particularly with regard to the types of land affected by the increased demand for biofuels production. The sharply differing estimates between 2008 and 2009 demonstrate how rapidly our understanding the iLUC phenomenon is changing.”

The summary of the ILUC draft analysis can be downloaded here.

Also, the Huffington Post published an article by Andrew Gumbel, in which the LA-based freelancer writes: “A few years ago, CARB caved to pressure from the oil and car industries and gave the green light that enabled GM and the rest of the automotive behemoths to “kill” the electric car. Now it is on the brink of performing another disservice to the future of the planet – this time by considering the adoption of an unproven, brand new method of “carbon scoring” different fuel types that happens to discriminate heavily in favor of old-fashioned fossil fuels like oil and gas and penalize biofuels.

“CARB’s decision, which has already been drafted and may or may not be made final on the first day of a two-day board meeting in Sacramento today, will be crucial not just to the fight against global warming in California. The means it chooses to determine the carbon intensity of different fuel types is likely to set the standard nationally, if not also globally. So a great deal is at stake.

“The methodology is not without its complications, but essentially CARB has two choices. The first is to “carbon score” different fuel types based on their chemistry and means of production alone, the so-called “well to wheels” model known by the acronym GREET which has been used and fully peer-reviewed.

“The second choice is to try to throw in considerations of broader economic and geopolitical realities. That’s not a bad idea in and of itself. It’s hard to assess the total environmental cost of importing oil from the Middle East without considering, say, the fuel burned on the tanker that brings it to the United States, or considering the impact of the continuing U.S. military presence in Iraq. The problem with the model being touted by CARB, though, is that it looks at these indirect factors in the context of biofuels only. It factors in the cost of driving ethanol by truck from Iowa to California, but lets oil and gas off the hook completely for comparable factors.

“A group of more than 100 scientists specializing in energy and the environment have written both to Governor Schwarzenegger and to Mary Nichols, who chairs CARB, to voice their concerns. “We’re basically talking about increasing the carbon score of some alternative fuels by 40-200% based on dubious economic modeling that is nowhere near ready for prime time, and then to add insult to injury they are not doing the same economic analysis on other eligible fuels in the program or petroleum,” the letter’s lead signatory, Blake Simmons of the Sandia National Laboratory, said in a statement. “This is indefensible from either a scientific or public policy perspective and will ultimately fail.”

The CARB hearing today is available via video (or audio only) webcast here.

POET CEO Jeff Broin made a last-minute appeal full text here:

“The ethanol industry supports an accounting of carbon emissions that includes all direct effects from all fuels, including direct land use change. It does not support the selective inclusion of indirect effects as CARB is proposing. Their proposal unfairly penalizes ethanol for indirect effects without considering the indirect effects of any other fuel. POET is not requesting special preference for our products. We are simply requesting the level playing field promised as part of the LCFS and that CARB hold ethanol to the same carbon accounting standard as petroleum, hydrogen, electricity, and all other fuels.”

The director of the Berkeley office of the Union of Concerned Scientists, Patricia Monahan, said in a statement:

“California’s low carbon fuel standard is a critical part of the state’s strategy to build a clean energy economy. But to fulfill the intent of the standard, CARB must account for all pollution caused by growing food crops for fuel. Scientific studies conclude that growing biofuels in the United States can trigger deforestation and other land use changes in other countries, resulting in more heat-trapping emissions going into the atmosphere. If we do not account for these emissions, the standard could result in more pollution than if we continued to rely on gasoline and diesel.

“The biofuel industry’s call for ’sound science’ is dishonest. The science is clear on this point. California needs a biofuels industry that’s part of a clean energy economy, not one that receives a blank check to pollute.

“The proposed value for corn ethanol is conservative, and a proper accounting would push the value up further. Corn ethanol producers should be aware that the future could look even more bleak. We are confident the air board will continue to refine how it calculates pollution from biofuels, and that emissions will likely be higher in future estimates. Biofuel investors should take the long view and invest in truly low carbon fuels, including ones made from waste, woodchips or switchgrass.”

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