California’s LCFS Solution Gets National Stage Time in Canada
Stillwater has written a lot about the California Low Carbon Fuel Standard (LCFS) program over the years, and we even publish a one-of-a-kind LCFS Newsletter covering California’s program. We’ve also reported on Oregon’s Clean Fuels Program (CFP) from its inception in 2016. Now, we turn to Canada’s under-construction Clean Fuel Standard (CFS) which aims to reduce Canada’s greenhouse gas (GHG) emissions by 30 million tonnes annually by 2030 through the increased use of lower-carbon fuels, energy sources and technologies. Unlike California’s or Oregon’s programs, the CFS is a nation-wide standard. It is intended to help Canada achieve its target of reducing national emissions by 30% below 2005 levels by 2030.
According to Environment and Climate Change Canada’s CFS Regulatory Design Paper, the CFS will “complement carbon pollution pricing by reducing greenhouse gas emissions throughout the lifecycle of fuels and by driving investments in cleaner fuels and in clean technology in Canada.” The standard’s regulations will set separate requirements for liquid, gaseous and solid fossil fuels with the liquid stream’s requirements set first. The initial draft regulations for the liquid stream (that’s liquid transportation fuels like gasoline and diesel and their substitutes) should be released this spring or summer with the finalization targeted for 2020.
Our friends at the Canadian firm ClearBlue Markets recently offered a helpful recap of the design of Canada’s CFS. Their recap highlights just how similar the preliminary design of the CFS is to California’s existing LCFS program. The CFS in its current draft form looks to be a technology-neutral policy – targeting climate change without picking winners and losers.
We will continue reporting on Canada’s efforts to enact a national LCFS-style program in the coming months. Sign up for Stillwater’s complimentary monthly newsletter to receive updates straight to your e-mail inbox.