Driving Decarbonization – Better Policy Means Better Fuels

In an apparent warning to prevent thought-leaders and policy-makers from getting complacent about the necessary actions to keep global warming below 2 degrees, the IEA Executive Director, Dr. Fatih Barol, pointed out that “Today modern bioenergy consumption to produce electricity, industrial heat, and transport biofuels is equal to all other renewables combined, including hydropower, wind and solar energy. Yet the role of modern bioenergy in decarbonizing the global energy system is not widely recognized, nor does it receive the attention it deserves.”

Based on its scenario modeling, the IEA concludes that “to meet long-term climate and other sustainability goals, renewable energy development in the heat, electricity and transport sectors must accelerate” with transportation clearly emerging as the most difficult sector to decarbonize. The need to accelerate the de-carbonization of all forms of transportation leads the IEA to call for “more favorable market and policy conditions”, which leads naturally to a number of questions, including inter alia

To answer these questions, we should first consider places where policy is driving de-carbonization of transport further and faster. The one – two punch of the U.S. Renewable Fuel Standard (RFS) and the California Low Carbon Fuel Standard (LCFS) is supporting rapid development and accelerating uptake of virtually all low carbon fuels, including ethanol, biodiesel and renewable diesel.

To draw attention to the success of the LCFS in driving emissions reductions from the transportation sector, the California Low Carbon Fuels Coalition (LCFC), the Biotechnology Innovation Organization (BIO) and below50 jointly organized and hosted “Driving Decarbonization”. This event explored the mechanics of the LCFS as well as the way it benefits human health, job creation, and economic growth.

The LCFS rewards fuels for reducing their carbon intensity and is technology neutral. In addition to reducing transportation emissions, an intended co-product of the LCFS was to stimulate investment in new LCF biorefineries. Already, California’s program has increased the value of the global clean fuels market by an estimated $2.8 billion. Excitingly, this demand signal is beginning to motiviate investment.

Given this success, carbon-intensity based transportation policy appears increasingly likely in Washington State and is becoming much less far-fetched in the Midwest. In other international jurisdictions, the LCFC is working with BIO, the World Business Council for Sustainable Development’s below50 campaign and local stakeholders and organizations to help develop comparable policies. below50 is active in Australia, Brazil, Europe and the U.S. and is promoting CA LCFS-like policies in these countries at both the federal and the state/provincial level. For example, below50 strongly endorsed Brazil’s Renovabio policyand is working to see that policy implemented in a way that generates a strong market signal for low carbon fuels.

Inevitably, these discussions will lead to calls for policies to realize the potential of the bioeconomy. The ABLC Global participants should look at the carbon-intensity based, technology-agnostic approach of California and ask how this approach can be tailored to their geographies and jurisdictions. To move this discussion forward, the LCFC and below50 and their member companies will highlight California’s approach at ABLC Global. It will be interesting to see which lessons new jurisdictions take from the California experience and how they tailor the carbon-intensity based and technology-agnostic approach to meeting their own carbon emission reduction and sustainable development goals. READ MORE