Flash Report: 4Q2023 LCFS Data Show Nearly 3 million MT Net Credit

May 7, 2024 By

On April 30, CARB posted the fourth quarter 2023 data for the LCFS program. In today’s flash report, we offer a quick look at this fourth quarter data. Our comprehensive analysis will be published in Stillwater’s Quarterly LCFS Newsletter which will be available to subscribers on Thursday, May 9th.

The fourth quarter data show a net credit of 2,964,629 metric tons (MT), an increase of 707,478 MT from the third quarter net credit of 2,257,151 MT. With the 4Q2023 net credit, the credit bank now stands at a record 23.55 million MT.

The table below summarizes the fourth quarter by fuel and compares it to the previous quarter (3Q2023) and to the same quarter last year (4Q2022).

A quick look at these data reveals a few trends of interest. The major factors contributing to the increase in net credits in the fourth quarter compared to the third quarter were: increases in net credits for renewable natural gas (RNG), renewable diesel (RD), and on-road electricity, amplified by a significant (18.3%) decline in ULSD deficits. Compared to the third quarter, 4Q2023 data showed a 6.0% increase in RNG net credits on a 1% decline in volume, a 6% increase in RD credits on a 2.9% increase in volume, and a 6.5% increase in on-road electricity credits on a 5.5% volume increase. For its part, alternative jet fuel (also known as sustainable aviation fuel or SAF) shows a remarkable 75.9% increase in net credits on a 73.9% increase in volume quarter-to-quarter, but given the small volumes, this did not move the needle significantly in overall credit generation. Notably, the total liquid diesel volume (ULSD, RD, and BD combined) decreased by 5% quarter-to-quarter.

The total net credit for the fourth quarter was up 0.71 million MT from the prior quarter and marked a 1.3 million MT increase compared to a year earlier (4Q2022). Together, RNG, on-road electricity, and RD also played the biggest roles in the year-on-year increase in net credits.

We will provide an in-depth analysis of this data in our upcoming quarterly newsletter, to be published on May 9, 2024. Access to Stillwater’s LCFS Newsletter is only available to subscribers. For more detailed information on LCFS data trends and analysis, be sure to subscribe!  

What does this quarterly data mean for Credit Prices?

Stillwater offers a full suite of credit price outlooks offering our view of the California Low Carbon Fuel Standard (LCFS), Oregon Clean Fuels Program (CFP), British Columbia LCFS (BC-LCFS) and U.S. Renewable Fuel Standard (RFS) markets through 2035. These outlooks are offered through our consulting practice, and come with a one-hour, one-on-one Q&A session with our senior subject matter experts!

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