Updating Low Carbon Fuel Standard Credit Quantification Methods to Support Equitable Outcomes

Research Team: Colin Murphy (lead), Julie Witcover, Jin Wook Ro, and Juan Carlos Garcia Sanchez

UC Campus(es): UC Davis

Problem Statement: The Low Carbon Fuel Standard (LCFS) plays a crucial role in California's climate policy, promoting emissions reduction by incentivizing the use of fuels derived from waste materials like agricultural residue or livestock manure. Environmental justice groups submitted a petition to the California Air Resources Board seeking the removal of livestock digesters from the LCFS, citing concerns over perceived excessive credits and insufficient consideration of local environmental impacts. CARB's current methodology for determining credits involves assessing whether greenhouse gas impacts are "additional" compared to a scenario without the LCFS. However, the criteria for additionality focus solely on emissions reductions relative to customary practices or legal limits, neglecting broader economic, social, and technological influences that drive emission reductions across industries. This simplistic additionality test may lead to overestimation of fuel incentives' impact, resulting in excessive crediting in some instances.

Project Description: This project will examine how livestock digesters are treated in the LCFS and understand how the determination of additionality and counterfactual baselines influences the credits generated for a given project. The goal is to propose a new approach to additionality that aligns LCFS credit generation more closely with actual emissions benefits, utilizing recent advancements in life cycle analysis methods. While there isn't a universally "correct" method for determining additionality or establishing a baseline, life cycle assessment literature provides various guidelines and methods suitable for specific situations. This project will review these guidelines to propose approaches for additionality determination and counterfactual baseline creation applicable to the LCFS. The researchers will also model the impacts of these proposed approaches.

Status: In Progress

Budget: $91,872