A low-carbon fuel standard (LCFS) is a policy that requires fuel producers and importers to reduce the carbon intensity of the transportation fuels they sell in a specific jurisdiction. The goal of an LCFS is to encourage the use of lower-carbon alternative fuels and to reduce greenhouse gas emissions from the transportation sector. The standard typically sets a declining target for the average carbon intensity of fuels sold over time, and allows fuel producers to generate credits or trade them with other producers if they produce fuels with lower carbon intensity than the target. Some examples include California’s LCFS, British Columbia’s Renewable and Low Carbon Fuel Requirements Regulation.
This is typically achieved by requiring fuel providers to reduce the lifecycle greenhouse gas emissions of the fuels they sell, or by incentivizing the use of lower-carbon alternative fuels. The goal of an LCFS is to reduce greenhouse gas emissions from the transportation sector and help achieve climate change mitigation goals. The specific design and implementation of an LCFS can vary depending on the jurisdiction and the intended goals of the policy.
The carbon intensity of a fuel is a measure of the amount of greenhouse gases emitted per unit of energy produced when the fuel is used. Under an LCFS, fuel providers must either reduce the carbon intensity of their fuel or purchase credits from other fuel providers that have achieved greater reductions. The goal of an LCFS is to reduce greenhouse gas emissions associated with transportation and to promote the development and use of low-carbon transportation fuels.
The standard sets a benchmark for the average carbon intensity of fuels sold within a jurisdiction, and requires fuel producers and importers to reduce the carbon intensity of their products over time. This is typically done by promoting the use of alternative, lower-carbon fuels such as biofuels, electricity, and hydrogen, and by increasing the efficiency of the transportation sector. The goal of an LCFS is to reduce greenhouse gas emissions from the transportation sector, which is a major contributor to climate change. Supplying electricity to electric vehicles, supplying hydrogen fuel to fuel cell vehicles, and blending biofuels such as ethanol, biodiesel, renewable diesel, and renewable natural gas into fossil fuels are the most common methods for reducing transportation carbon emissions. The primary goal of a low-carbon fuel standard is to reduce carbon dioxide emissions associated with vehicles powered by various types of internal combustion engines while also taking into account the entire life cycle (“well to wheels”) in order to reduce transportation’s carbon footprint.