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State LCFS Profile: Pennsylvania

Wednesday, March 17th, 2010

State of Play: LCFS in Pennsylvania

In December, Pennsylvania governor Ed Rendell joined several states in signing a Memorandum of Understanding laying out a timetable for the future implementation of a Low-Carbon Fuel Standard (LCFS). In committing his state to the agreement, Gov. Rendell pledged to work with other states to “ensure the development of a strong federal program” for imposing an LCFS nationwide. After signing the document, the governor characterized the LCFS as a policy that “can create thousands of more jobs” – all while “breaking the addiction to foreign oil.”

Unfortunately, the only way an LCFS can “work” as engineered is by rendering secure, affordable sources of energy off limits – thereby having the effect of significantly expanding our nation’s dependence on foreign, LCFS-favored energy to meet its daily needs.

Production and Distribution: How/Where Does Pennsylvania Get Its Energy?

Pennsylvania is credited with the distinction of being home to the first commercial oil well ever successfully drilled – Drake Well, August 1859, Titusville, Pa. One hundred and fifty years later, Pennsylvania today produces scarcely 0.2 percent of the nation’s petroleum supplies, according to EIA — although recent advancements in technology have allowed the state to dramatically increase the volume of natural gas produced from the Marcellus Shale.

Although Pennsylvania may not produce much oil, it remains the most prolific refining state in the entire Northeast – receiving daily shipments of foreign crude through ports in Marcus Hook and Philadelphia. All told, the state receives crude oil imports from eight separate foreign countries, in addition to shipments from the Gulf Coast and points south. The following graph presents this reality in greater detail:

LCFS Impact on Pennsylvania

Like many Northeastern states, Pennsylvania relies heavily upon home heating oil to keep warm during the cold winters. In fact, almost a third of households in the state use fuel oil as their primary energy source for space heating – supplies that a regional LCFS program will make more expensive to purchase and more difficult to access in the future.

In 2009, Pennsylvania secured over $308 million from the federal Low-Income Home Energy Assistance Program (LIHEAP) to help subsidize the purchase of these fuel resources for those in need. Unfortunately, under the LCFS, a large portion of this fuel oil may be targeted for elimination, adding additional strain to an already over-extended LIHEAP budget.

But while an LCFS is sure to impact the residents of Pennsylvania, the vast majority of energy in the state is consumed by the state’s industrial sector, including aluminum production, chemical manufacturing, glass making, petroleum refining, forest product manufacturing and steel production. With higher costs for fuel and dramatically reduced availability of it, the ultimate effect of an LCFS could be significant job losses in the state.

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The Big Chill: As Millions of Americans Turn to LIHEAP to Get Through Winter, NE Guvs Sign LCFS Pact Designed to Make Heating Oil More Expensive

Wednesday, March 3rd, 2010

WASHINGTON – Hours before the ball dropped on 2010 in Times Square, governors from 11 Northeast and mid-Atlantic states signed an agreement paving the way for the region-wide adoption of a California-style Low-Carbon Fuel Standard (LCFS), a policy that will dramatically restrict consumers’ access to local and affordable supplies of home heating fuel without doing a thing to reduce global greenhouse gas emissions.

By design, an LCFS is engineered to deliver higher prices at the pump, and sharp reductions in the availability of LCFS-targeted home heating oil – essential energy supplies that have become prohibitively expensive for many working-class families in New England. Remarkably, even at a time when more Americans are seeking assistance under the federal Low-Income Home Energy Assistance Program (LIHEAP) than ever before, governors across the region are actively working to make those fuel resources more expensive – by actively working to impose a Low-Carbon Fuel Standard.

A story in yesterday’s USA Today sheds new light on just how severe the situation has become:

  • “A record number of U.S. households are applying for help to pay home heating bills with 17 states fielding application requests that are up more than 20% from last year, the National Energy Assistance Directors’ Association says. Almost 9 million U.S. households are expected to need help paying winter energy bills. That’s up 15% from the record-setting 7.7 million last year, the association says.”

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State LCFS Profile: Massachusetts

Friday, February 26th, 2010

State of Play: LCFS in Massachusetts

On July 28, 2008, Massachusetts governor Deval Patrick signed the Clean Energy Biofuels Act, directing the state to develop and implement a Low-Carbon Fuel Standard (LCFS). Working hand-in-glove with the Boston-based Northeast States for Coordinated Air Use Management (NESCAUM) office, Gov. Patrick convinced other governors to sign onto the Dec. 2009 NESCAUM-drafted memorandum of understanding (MOU), thus committing their states down a path whose terminus is the ultimate adoption statewide of an LCFS.

In signing that memorandum, Gov. Patrick characterized the LCFS as a policy initiative that would make Massachusetts “more energy independent and environmentally sustainable.” Unfortunately, for reasons described below, an LCFS is likely to have a disproportionately severe impact on the Bay State relative to other state signers of the MOU – without doing a thing to reduce the global concentration of carbon dioxide in the atmosphere.

Production and Distribution: How/Where Does Massachusetts Get Its Energy?

Massachusetts has no homegrown petroleum reserves, and doesn’t refine any petroleum either. The state is thus almost completely reliant on fuel imports originating outside the state and nation, which arrive in Boston Harbor via barge and tanker. Additionally, refined product is exchanged between Massachusetts and its neighbors through the use of two small-capacity pipelines, which link up ports in Connecticut and Rhode Island to Springfield.

According to data collected by the Energy Information Administration (EIA), the vast majority of the state’s gasoline, diesel fuel, kerosene (jet fuel) and home heating oil is imported from refineries in Canada and the U.S. Virgin Islands, with smaller percentages barged in from the United Kingdom and Portugal. Unfortunately, under the LCFS, refined energy supplies from both Canada and the Virgin Islands would be targeted for gradual elimination – since both sources use oil that scores poorly under the bizarre accounting methodology of the LCFS.

LCFS Impact on Massachusetts

Plainly put, no state in America is more heavily reliant on heating oil than Massachusetts. In the Bay State alone, more than 963,000 homes — almost half – use it to keep warm during the winter. All told, Massachusetts consumes 2 billion gallons of the stuff every year, accounting for almost 20 percent of the nation’s heating oil demand.

What does the state’s dependence on heating oil have to do with the imposition of an LCFS? According to a statement in the MOU initiated by Massachusetts and signed by 11 governors in December, home heating oil will receive no special regulatory treatment under an LCFS – that is, any effort to prevent LCFS-targeted gasoline and diesel from entering the state will also be extended to home heating oil, which tends to come from the exact same places.

As a result, Gov. Patrick’s support for an LCFS could lead to higher energy prices for those who can least afford them – especially middle- and working-class families and retirees living on fixed-incomes.

In 2009, Massachusetts secured more than $213 million from the federal Low-Income Home Energy Assistance Program (LIHEAP) to help subsidize the purchase of these home heating resources for those in need. Unfortunately, under the LCFS, a large portion of this fuel oil may be targeted for elimination, adding additionally strain to an already over-extended LIHEAP budget.

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State LCFS Profile: Maine

Friday, February 26th, 2010

What Is a Low-Carbon Fuel Standard (LCFS)?

Sold to the public as a way to lower the carbon content of fuel and reduce the amount of CO2 emitted from our tailpipes, in reality the Low-Carbon Fuel Standard (LCFS) isn’t about making the fuels in your vehicle any better, cleaner or more affordable than they already are – it simply seeks to render those fuels more difficult to find and even more expensive to purchase.

State of Play: LCFS in Maine

In 2009, Maine’s Dept. of Environmental Protection (DEP) cited the LCFS as one of 12 emerging issues as part of its annual Government Evaluation Act Report.  By December of that year, Gov. Baldacci joined 10 other northeast and mid-Atlantic states in signing a Memorandum of Understanding (MOU) addressing an LCFS – a memo that initiates the process of implementing a statewide LCFS regime in Maine.

Following Gov. Baldacci’s announcement, James Brooks, director DEP’s Air Quality Bureau, told reporters that his department will likely conduct an independent analysis aimed at assessing how the imposition of an LCFS may ultimately impact Maine residents.

Production and Distribution: How/Where Maine Gets Its Energy

Maine has no fossil fuel reserves, and produces less than 35 percent of the energy it consumes.  But thanks to the coastal ports of Portland, Searsport and Calais, Maine is able to receive petroleum products from a number of friendly foreign sources — with over 60 percent of those imports coming from Canada.  Maine also reaches across its border for refining capability, receiving crude oil through its ports and sending product via the Portland Pipeline to refineries in Quebec and Ontario.

Like many northeastern states, Maine is also highly dependent on others for its essential supplies of home heating oil.  In fact, Maine has the highest share of households in the nation that use fuel oil for space heating during winter months. Again, the state leans heavily on Canada for those supplies – and thus stands to be tremendously impacted by an LCFS policy that explicitly targets Canadian energy.

LCFS Impact on Maine

As mentioned, Maine’s reliance on Canadian energy imports both for the purposes of fueling vehicles and warming houses renders the state among the most vulnerable to price and supply disruption under an LCFS regime.

As they often do, these impacts are likely to fall disproportionately upon those who can least afford them. Earlier this year, President Obama issued a budget blueprint that proposes a $1.8 billion cut in the federal Low-Income Home Energy Assistance Program (LIHEAP) – a fund that’s used to defray some of the costs associated with the purchase of heating oil for those in need. Under the LCFS, that heating oil is likely to see a dramatic increase in cost – and that, coupled with the reality of less money available pursuant to the LIHEAP program, may mean even tougher winters ahead for the residents of Maine.

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State LCFS Profile: Delaware

Wednesday, February 17th, 2010

What Is a Low-Carbon Fuel Standard (LCFS)?

Sold to the public as a way to lower the carbon content of fuel and reduce the amount of CO2 emitted from our tailpipes, in reality the Low-Carbon Fuel Standard (LCFS) isn’t about making the fuels in your vehicle any better, cleaner or more affordable than they already are – it simply seeks to render those fuels more difficult to find and even more expensive to purchase.

State of Play: LCFS in Delaware

On December 30, 2009, Delaware joined 10 other Northeast and mid-Atlantic states in endorsing a plan that calls for the eventual region-wide adoption of a blanket LCFS policy. On the day that he signed the memorandum, Gov. Jack Markell lauded the LCFS as a way to “improve our environment and create jobs” by “join[ing] other states in addressing carbon emissions.”

Unfortunately, what Gov. Markell failed to mention is that an LCFS doesn’t actually seek to impact the amount of carbon emitted from our tailpipes – and can’t. According to EPA, the carbon content of gasoline is constant – 19.4 pounds of carbon dioxide emitted for every gallon of fuel combusted.

Production and Distribution: How/Where Delaware Gets Its Energy

Delaware produces none of its own oil or natural gas, and just recently experienced the closure of its only refinery (although news last week indicates that it may re-open in the future). Because of that, the First State is almost completely dependent on others for the energy it needs to run – with most of the state’s petroleum resources piped in from the Gulf Coast, and imported via tanker from foreign suppliers in Canada, Russia, Angola and Azerbaijan.

Nearly 300,000 barrels of oil received at the Port of Wilmington each month is considered “heavy” under the byzantine accounting methodology of the LCFS – and would thus be targeted for eventual elimination.

LCFS Impact on Delaware

Currently, more than 20 percent of households in the state of Delaware use fuel oil as their primary energy source for home heating – not as high a percentage as one would find in New England, but still considered a major source of energy for more than 200,000 Delaware residents.  Regrettably, under an LCFS, those who rely on this heating oil are likely to see those resources grow increasingly expensive, as shipments of refined product derived from LCFS-targeted oil become more scarce.

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N-O Canada! Whole Foods Bows to Pressure Groups on Canadian Oil-Sands, Provides China with New Opening to Claim U.S-bound Energy

Thursday, February 11th, 2010

WASHINGTON, D.C. – It may be true that energy resources derived from Canada’s oil-sands today are 33 percent less carbon-intensive than they were a decade ago. It may be true that emissions from the oil-sands are lower than heavy oil production in many U.S. states. And it also may be true that diverting millions of barrels a day of secure, oil-sands energy to far-away China may actually increase global GHG emissions – all while costing Americans their jobs, and expanding our already dangerous dependence on energy from the Middle East.

Unfortunately, for executives at Whole Foods and Bed Bath & Beyond, none of that seems to matter.

Following the announcement yesterday that these two companies — in partnership with the environmental pressure group ForestEthics — will attempt to purge oil sands-derived energy from their transportation fleets, Michael Whatley, vice-president of Consumer Energy Alliance and a leading American expert on the oil-sands, released the following statement:

“The anti-oil sands position taken by these companies fails to take into account that GHG emissions from oil sands are comparable to other U.S. crude oil imports – and continue to go lower every year,” said Whatley. “More than that, it fails to recognize that turning our backs on this secure, affordable, North American energy resource will simply allow our competitors in China and elsewhere to claim energy that would’ve otherwise come to us — rendering our country even more dependent on the Middle East for its energy.”

According to a story posted yesterday by the Canadian Press, Whole Foods’ master plan to purge its transportation fleet of energy derived from the oil-sands appears to be focused on a single refinery in a single state – begging the question of how the company intends to apply this new policy to its remaining 288 locations spread across three countries. Also left unaddressed is how Whole Foods locations in states such as Montana, Wisconsin, Minnesota, Michigan and Illinois can possibly expect to comply with this stricture – given that more than 50 percent of petroleum supplies available in these states come from Canada.

“These announcements send a troubling message to our closest strategic and trading ally,” Whatley added, citing our nation’s long-time partnership with Canada. “One can only assume these companies will also boycott heavy oil produced in places like California, Mexico and Venezuela – as well as crude produced in the Middle East, and then shipped over 10,000 miles to get here. Otherwise, this exercise seems fairly hypocritical in the best case, and downright disingenuous in the worst.”

The announcements will certainly be welcome news to our competitors in China, who would like nothing more than to claim for themselves the secure, affordable, North American energy resources that would have otherwise be sent to consumers here in the U.S. In particular, Whatley pointed to the recent investment by the Chinese government of nearly $2 billion to purchase oil-sands concessions in Alberta – the clearest indication yet that the Chinese are actively working to secure these resources for themselves.

Independent analyses have also confirmed this plan. According to a report compiled by President Obama’s top energy analyst at the U.S. Department of Energy, closing off U.S. markets to oil-sands energy would simply open up new opportunities for China to send that energy thousands of miles abroad, potentially increasing global greenhouse gas emissions while rendering the United States even more dependent on unstable Middle East oil to run its economy.

“While CEA stands four-square against the decision made by these firms this week, we also recognize this may be an opportunity to work with these companies – and others that might be considering a similar course of action – to educate them on what the oil-sands are really about, and how they can be used to create jobs here at home and strengthen America’s energy security, all while protecting and preserving our environment,” Whatle concluded.

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State LCFS Profile: New York

Thursday, February 11th, 2010

What Is a Low-Carbon Fuel Standard (LCFS)?

Sold to the public as a way to lower the carbon content of fuel and reduce the amount of CO2 emitted from our tailpipes, in reality the Low-Carbon Fuel Standard (LCFS) isn’t about making the fuels in your vehicle any better, cleaner or more affordable than they already are – it simply seeks to render those fuels more difficult to find and even more expensive to purchase.

State of Play: LCFS in New York

On December 30, 2009, New York joined 10 other Northeast and Mid-Atlantic states in signing a Memorandum of Understanding (MOU) on LCFS – a memo that lays the groundwork for the eventual implementation of a statewide LCFS regime in New York. In a statement issued the day of the agreement, New York Gov. David Paterson characterized the LCFS as a means for “creating the next generation of fuels that will address climate change.”

Unfortunately, according to several recent studies on the topic, an LCFS not only won’t do a thing to reduce the amount of carbon emitted into the atmosphere – it may actually contribute to an overall increase in global greenhouse gas emissions.

Production and Distribution: How/Where New York Gets Its Energy

Unlike many states in the Northeast, New York does produce small quantities of oil, and a respectable amount of natural gas — mostly in the western part of the state. Unfortunately, that production contributes only marginally to total energy demand of New York, with most of the state’s petroleum products supplied from the outside — by refineries in New Jersey and Pennsylvania, the Colonial Pipeline from the Gulf Coast, and foreign imports from Canada, Norway, Russia, Portugal and India.

But while energy may arrive in New York from no fewer than 15 separate states and foreign entities, the vast majority of the state’s foreign imports come from Canada – energy that stands to be severely restricted under the LCFS regime currently in the works. The graph below details the disparity:

LCFS Impact on New York State

Like many Northeastern states, New York relies heavily upon home heating oil to keep warm during the typically cold and volatile winters (see: 2009-2010). All told, roughly a third of households in the state use fuel oil as their primary energy source for space heating – supplies that a regional LCFS program will make more expensive to purchase in the short-term, and much more difficult to access beyond that.

Last year, the state of New York secured $537 million from the federal Low-Income Home Energy Assistance Program (LIHEAP) to help subsidize the purchase of these fuel resources for those in need. Unfortunately, under the LCFS, a large portion of this fuel oil may be targeted for elimination under a regime that’s fundamentally set up to disadvantage Canadian reserves, adding additionally strain to an already over-extended LIHEAP budget.

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State LCFS Profile: Connecticut

Tuesday, February 9th, 2010

What Is A Low-Carbon Fuel Standard (LCFS)?

Sold to the public as a way to lower the carbon content of fuel and reduce the amount of CO2 emitted from our tailpipes, in reality the Low-Carbon Fuel Standard (LCFS) isn’t about making the fuels in your vehicle any better, cleaner or more affordable than they already are – it simply seeks to render those fuels more difficult to find and even more expensive to purchase.

State of Play: LCFS in Connecticut

On December 13, 2009, Consumer Energy Alliance vice president Michael Whatley sent Gov. Jodi Rell a detailed letter laying out the precise consequences that the imposition of a statewide LCFS could have on Connecticut residents. Nevertheless, two weeks later, Gov. Rell signed a Memorandum of Understanding with 10 other Northeast and mid-Atlantic states that sets the stage for an LCFS regime to be implemented by the end of next year.

Connecticut, unlike several of its regional neighbors, has yet to announce whether it will study how the adoption of a regional LCFS might impact local fuel supply markets.

Production and Distribution: How/Where Connecticut Gets Its Energy

While Connecticut may rank No. 2 in the nation in the production of oysters, the state unfortunately does not produce any significant energy resources – instead, relying on fuel imports from outside the state and the country that arrive in Connecticut via the port of New Haven.

According to the Energy Information Administration (EIA), imports of refined diesel fuel and home heating oil arrive each day from the Netherlands, the Virgin Islands, France, Mexico and Canada. Under the LCFS, fuel resources from both Mexico and Canada would be targeted for eventual elimination – exacerbating the state’s already dangerous status as a “fuel island,” and contributing to a significant and likely immediate increase in price.

But while an LCFS is sure to impact Connecticut residents, the vast majority of LCFS-targeted distillate fuel is consumed by the state’s industrial sector. With higher costs for fuel and dramatically reduced availability of it, the ultimate effect of an LCFS could be significant job loss in the state.

LCFS Impact on Connecticut

Like many Northeastern states, Connecticut relies heavily upon home heating oil to keep warm during the winter. All told, roughly half the households in the state use fuel oil as their primary energy source for space heating – consuming 545,000,000 gallons of the stuff each year.

Last year, Connecticut secured $126 million from the federal Low-Income Home Energy Assistance Program (LIHEAP) to help subsidize the purchase of these fuel resources for those in need. Unfortunately, under the LCFS, a large portion of this fuel oil may be targeted for elimination under a regime that’s fundamentally set up to disadvantage Canadian and Mexican reserves, resulting in higher prices and less access for residents.

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State LCFS Profile: Maryland

Tuesday, February 9th, 2010

What Is A Low-Carbon Fuel Standard (LCFS)?

Sold to the public as a way to lower the carbon content of fuel and reduce the amount of CO2 emitted from our tailpipes, in reality the Low-Carbon Fuel Standard (LCFS) isn’t about making the fuels in your vehicle any better, cleaner or more affordable than they already are – it simply seeks to render those fuels more difficult to find and even more expensive to purchase.

State of Play: LCFS in Maryland

In December 2009, Maryland joined 10 other Northeast and Mid-Atlantic states in signing a Memorandum of Understanding (MOU) on LCFS – one that demands that Maryland follow the lead of Massachusetts and implement virtually whatever policy initiative comes from the NESCAUM drafting process, based in Boston. In a statement following the signing, Gov. O’Malley suggested that the imposition of an LCFS “presents another opportunity to reduce carbon emissions and create green jobs.”

Unlike other states, Maryland does not appear to be engaging in any independent research examining whether an LCFS would actually work as advertised in the state.

Production and Distribution: How/Where Maryland Gets Its Energy

According to the Energy Information Administration (EIA), Maryland produces only 17 percent of the energy it consumes.  To make up the difference, it relies heavily on refined petroleum imports originating in the Gulf Region that travel along the Colonial Pipeline, as well as shipments from Canada and the UK that dock at the Port of Baltimore.

LCFS Impact on Maryland

Despite the fact that temperatures average around 40 degrees in the middle of winter, Maryland consistently ranks among the top five in the category of most expensive home heating oil states in the country.  Under the proposed LCFS, it’s quite possible that petroleum imports from the Gulf and Canada will no longer be accepted as fuel options – since these sources receive failing grades under the bizarre accounting methodology of the LCFS.

Since Maryland looks to these regions to provide more than 80 percent of its required energy supply, the state will be forced to look elsewhere to supplement the loss, with the most-likely candidates being volatile producers from the Middle East.  The result of this decision will be even higher home heating prices, expanded dependence on foreign, unstable sources, and the loss of jobs due to the added financial strain on Maryland’s economy.

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CEA: California LCFS Bad for Consumers, Bad for Producers, and Violates Federal Law

Tuesday, February 2nd, 2010

Consumer Energy Alliance files complaint with District Court in Fresno asking for immediate injunction on Low-Carbon Fuel Standard

FRESNO – California’s recently implemented Low-Carbon Fuel Standard (LCFS) violates federal law by attempting to regulate “commerce and conduct” outside of the state, while imposing a mandate that even regulators admit will result in “little or no net change” to the carbon intensity of fuels on “a global-scale.” Such is the formal complaint filed by Consumer Energy Alliance (CEA) in the U.S. District Court for the Eastern District of California today, asking the court to suspend the imposition of a statewide LCFS until a number of substantive legal concerns can be addressed.

“The practical outcomes of the California LCFS are higher fuel costs for consumers, dramatic reductions in the availability of those fuels, and a rapid expansion of the state’s already unacceptable level of dependence on foreign, unstable regimes for its energy,” said Michael Whatley, vice-president of CEA and former chief counsel for the U.S. Senate subcommittee on clean air and climate change. “More relevant to today’s filing, the California LCFS also actually violates federal law – and stands in direct contravention of key consumer protections and safeguards enshrined in the U.S. Constitution.”

Formally adopted last month after the state’s Office of Administrative Law (OAL) issued its final approval, the California LCFS, according to its authors, seeks to reduce the carbon-intensity of fuels included in the state’s transportation mix “while stimulat[ing] the production and use of alternative, low-carbon fuels.” But under the bizarre accounting methodology of the plan, energy sources with physically identical chemical properties and carbon contents can – and, in fact, must be – treated differently under the law, with in-state sources significantly advantaged over resources that are found and produced outside California.

“Perhaps it wasn’t the state’s intent, but as written, the California LCFS is an example of parochial protectionism run amok,” added Whatley. “But make no mistake: This isn’t the type of protectionism that will benefit California consumers; it’s the type that will ensure sources of essential energy are harder to find in the future, and much more expensive to purchase.”

In support of that statement, Whatley pointed to a recent analysis of the proposed state LCFS completed by California-based Sierra Research. In that study, analysts from Sierra found that an LCFS will increase the cost of fuel in California by $3.7 billion over the next decade – all while producing “no detectable change in climate.”

With more than 260,000 grassroots supporters and 130 affiliates representing both the major consuming and producing segments of the U.S. energy sector, CEA has been an active contributor to the national debate on LCFS – including the proceedings in California – for the better part of the last two years.

Last August, the Washington, D.C.-based Center for North American Energy Security, a CEA member, sent a letter to the California Air Resources Board (CARB) detailing the myriad short-comings with the LCFS, and several CEA members (including the National Petrochemical & Refiners Association and the American Trucking Associations – which joined CEA in filing the complaint today) have lodged formal comments with CARB objecting to the plan as well. In addition, CEA wrote directly to U.S. Sen. Barbara Boxer (D-Calif.) in October identifying several significant consequences that consumers should expect to encounter under the initiative.

What follows are several key excerpts taken from the CEA complaint filed in Fresno this morning:

42.        Because “carbon intensity” is designed to account not only for a fuel’s physical characteristics, but also the energy necessary to bring the transportation fuel to market in California, chemically identical fuels are assigned different carbon intensities under the LCFS.  LCFS  § 95486(b), Tables 6–7.

44.        By regulating the “fuel pathway” of transportation fuels – i.e., the manner in which transportation fuels are produced and ultimately reach the California market – the LCFS directly regulates interstate commerce and conduct occurring outside of California.

47.        CARB has admitted that, because no other states have adopted a similar standard, “fuel producers are free to ship lower-carbon-intensity fuels to areas with such standards, while shipping higher-carbon-intensity fuels elsewhere.”  CARB, California’s Low Carbon Fuel Standard: An Update on the California Air Resources Board’s Low Carbon Fuel Standard Program (Oct. 2009) at 1.

48.        According to CARB, “[t]he end result of this fuel ‘shuffling’ process is little or no net change in fuel carbon-intensity on a global scale.”  Id.

49.        In fact, the “fuel shuffling” promoted by the LCFS likely will lead to an overall increase in GHG emissions, because it will mean redirecting fuels and feedstocks destined for California to other states through less efficient and redundant supply lines.  Id.; see also CARB, Final Statement of Reasons (Dec. 2009) at 234–35.

50.        The burdens imposed by the LCFS on the interstate market for transportation fuels and fuel feedstocks in California are clearly excessive when measured against the putative local benefits of the LCFS in California.

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