In recent amendments to the Low Carbon Fuel Standard, the California Air Resources Board has proposed giving Low Carbon Fuel Standard (LCFS) credit to hydrogen and electric vehicle fueling stations, whether or not they provide low carbon fuels and regardless of the carbon intensity of the hydrogen or power provided. BAC and other biofuels producers submitted a joint letter objecting to this proposal as it would undercut the core strength of the LCFS program, which is based solely on the lifecycle carbon intensity of fuels. Picking technology winners and losers takes away the performance (science) based foundation of the LCFS program and makes if far less likely to achieve the state’s carbon and petroleum reduction goals.
In late August, the California Legislature passed SB 100 (de Leon), which increases California’s renewable electricity (RPS) requirement from 50 to 60 percent by 2030. SB 100 also requires the California Public Utilities Commission to plan for 100 percent of the state’s electricity to come from RPS eligible or zero carbon power by 2045. These two provisions will help to keep renewable power growing in California and will force the CPUC to plan for a more diverse portfolio of resources to meet the 100 percent target in 2045.
The California Public Utilities Commission (CPUC) has reopened its proceeding on pipeline biomethane to reconsider the current standards and incentive programs for pipeline biomethane. Legislation that BAC sponsored in 2016 required the CPUC to hire the California Council on Science and Technology (CCST) to review pipeline standards for heating value (BTU) and siloxanes. CCST issued its report earlier this summer recommending a number of changes and the CPUC then asked parties to comment on CCST’s recommendations as well as a number of other issues related to incentives for biomethane. The CPUC is expected to rule on these issues before the end the year. BAC’s Reply Comments on Pipeline Biomethane focus on several key issues:
- Need to adopt a biomethane procurement requirement that focuses on instate biomethane production from all organic waste sectors and conversion technologies.
- Need to increase incentives for pipeline biomethane, including an allocation of the gas utilities’ Cap & Trade revenues and an increase in R&D for biomethane.
- Support for the California Council on Science and Technology’s recommendations to revise the standards and monitoring requirements for BTU and siloxanes.
See BAC’s Comments on proposed changes to pipeline biomethane standards, opportunities for additional funding for pipeline biomethane, and the need for a biomethane procurement program. These were filed with the CPUC in late July 2018.
California has some of the strictest pipeline biogas requirements in the country, which can add significantly to the costs of pipeline biogas projects. As a result, the state enacted legislation in 2016 requiring the California Council on Science and Technology (CCST) to review the standards for the heating value (BTU) and siloxanes. The CCST report recommends that the CPUC consider reducing the BTU requirement to as low as 970. CCST recommends further study on the siloxanes standard and suggests that monitoring requirements be reduced for biogas sources that are unlikely to have siloxanes (diverted organic waste, dairy, forest and agricultural waste).
Click here to see the CCST study and executive summary.
The Governor and Legislature have reached agreement on how to spend $1.4 billion in Cap & Trade auction revenues. The bioenergy related funding allocations in the Cap & Trade Investment Plan are:
- $175 million for clean vehicle rebate program
- $180 million for clean trucks, buses and offroad vehicles
- $112 million for agricultural diesel engine replacement
- $12.5 million for low carbon fuel production
- $5 million for Healthy Soils
- $210 million for healthy forests and forest carbon
- $99 million for dairy methane reduction
- $25 million for waste diversion
- $40 million for transformative climate communities/research
This is the full Cap & Trade Investment Plan 2018-19
Despite numerous Orders and direction from CPUC staff, PG&E and the other utilities were delaying executing a dozen BioMAT contracts that have been pending since last fall. The CPUC rejected a motion by PG&E to suspend the BioMAT program, but then PG&E claimed that a federal court decision on the ReMAT program justified the utility’s continuing refusal to sign BioMAT contracts. After reviewing the Winding Creek decision and parties’ comments on it, the CPUC ordered the utilities – yet again – to continue BioMAT contract execution. The CPUC issued Resolution E-4922 on March 22, ordering PG&E and other utilities to continue BioMAT procurement and contract execution.
BAC provided comments on several of the proposed changes to the LCFS that would adversely affect the instate biomethane industry, including a proposed reduction in the 2020 target, proposed change to biomethane that would require it to meet pipeline standards whether or not it will be injected into a utility pipeline, carbon intensities for temporary fuel pathways that are much higher than the actual carbon intensities for biomethane projects, and other changes.
Thee California Air Resources Board has proposed major changes to the Low Carbon Fuel Standard, including changes to the 2020 and 2030 targets for carbon intensity, changes to the definition of “biomethane,” temporary carbon intensity levels for various types of fuels, and other changes that could have major impacts on biomethane development in California.
Despite repeated orders from the CPUC telling PG&E that it does not have the authority to suspend BioMAT procurement, PG&E has tried yet again by announcing that it will not sign BioMAT contracts until a federal court case involving the ReMAT has been resolved. That could be years. Meanwhile, the CPUC has ordered PG&E to continue BioMAT procurement, but PG&E will not sign any new BioMAT contracts until the CPUC orders it – yet again – to do so.
Fortunately, Phoenix Energy filed a motion to compel PG&E to execute BioMAT contracts. BAC filed this joint response with the California Association of Sanitation Agencies, Placer County Air Pollution Control District, and Aries Clean Energy in support of Phoenix Energy’s motion.