With several proposals in the House and Senate for the creation of a nationwide low carbon fuel standard (LCFS), California's LCFS plan is seen as a model for what the rest of the nation can achieve. During today's OnPoint, Alex Farrell, director of the UC Berkley Transportation Sustainability Research Center and director of the report, "A Low Carbon Fuel Standard for California," discusses the feasibility of California's proposal to reduce the carbon intensity of its transportation fuels by 10 percent by 2020. Farrell says the most successful national approach will seek to regulate the effect of global warming and will allow the market to choose which technologies will be best for creating low carbon fuels. Farrell also compares California's low carbon fuel standard to President Bush's 20-in-10 proposal.
Monica Trauzzi: Welcome to OnPoint. I'm Monica Trauzzi. Joining me today is Alex Farrell, director of the UC Berkeley Transportation Sustainability Research Center and also director of the Low Carbon Fuel Standard for California report. Alex thanks for coming on the show.
Alex Farrell: My pleasure, glad to be here Monica.
Monica Trauzzi: Alex, you're in town talking to lawmakers about the implementation of a low carbon fuel standard. The California executive order calls for a 10 percent reduction in carbon intensity of California's fuels by 2020. How attainable is the target based on our current technologies and the pace at which our technologies are growing?
Alex Farrell: That's a good question. Probably I need to explain what the carbon intensity means. It means the global warming effect per unit energy. So, it's the amount of affect that we get for every gallon of fuel or every Btu of fuel. Our study indicates that there are a wide range of possible ways in which this standard could be met. Some of them involve very little innovation, just using the existing technologies, the best in class technologies. But the outcomes that look more suitable to us and more preferable involve some improvements in technologies, including success in a few of the pilot projects that we have already underway, so we think that it's quite doable.
Monica Trauzzi: Talk a bit more about how you got to the technical feasibility aspects of the LCFS.
Alex Farrell: What we did is we used a model that was developed by Argonne National Laboratory, the vision model, and calibrated it for the state of California. And then looked at a range of scenarios, a total of about a dozen scenarios that reached different levels of carbon intensity reduction and looked at what rates of vehicle introduction, what rates of changes in fuel properties would be required to reach the LCFS at a 10 percent reduction and a 5 and a 15 percent reduction and tried to construct, again, 12 scenarios that were reasonable based on historical experience.
Monica Trauzzi: The House Energy and Commerce Committee is taking up the LCFS issue and they're planning on expanding the alternative fuels mandate, creating a new Low Carbon Fuel Standard and also incentivizing the expansion of alternative fuels. Can we be as aggressive as California on a national level?
Alex Farrell: That's a good question. We haven't looked carefully at that. But let me try and take what we've learned from looking at California and think about the rest of the nation. For one thing, if we are going to use the current types of technology that utilize corn and soy and other types of crops for our fuel production that will be more challenging because that's limited. However, some of the technologies that are being developed now use residues and wastes, and those are available in large quantities anywhere where there's lots of people. So my view is that although we haven't studied it very carefully it's likely to be the case that a similar approach can be taken. And I should mention we didn't even look at really advance technologies, things that aren't even in production yet, things that actually could make a significant difference, like big changes in the way we produce fuel from cellulosic technologies that use advanced biofuels or, as we say, advanced feed stocks or things as unusual at the moment as the Savalgi. Those could become viable within 10 years.
Monica Trauzzi: We've seen a few proposals on the Hill already, including in the Senate. We mentioned the House earlier. Senators Collins, Feinstein, Snow, Boxer, Lieberman, Obama, and Harkin, they've all introduced legislation and several of them mimic California's proposal. Which works best?
Alex Farrell: I haven't looked in detail, unfortunately, at all of the bills. Unfortunately, that's a full-time job and my full-time job has been trying to understand how to implement it in California. But I can tell you the way to tell which ones work the best. The ones that will work the best are the ones that actually regulate what we care about, which is the carbon content or the global warming impact, the ones that take the government out of picking technological winners; those are the ones that are going to be successful.
Monica Trauzzi: Let's focus on the ethanol option for a moment, you were mentioning it a little bit earlier. There are several different issues that come into play. There's the food for fuel issue and additionally the technology for cellulosic ethanol isn't quite at the implementation point yet. How do you meet the 2020 goal if there is a giant unknown about the future of cellulosic ethanol?
Alex Farrell: There's no way that a university researcher or any single person can really understand the status of technology today, because there's lots of work that's being done in laboratories all across the United States, public laboratories and universities and private laboratories in various different companies. So what we can do is we can look at what the challenges appear to be to bring some of these technologies into the marketplace. And look at the types of progress that people have made so far and the types of projects that are being proposed and have a sense that there are so many different opportunities. And, for instance, there are opportunities that aren't even about cellulosic technology, that are about battery technology. And look at the pace of those in the past. Looking at the pace of those in the past gives us confidence that this is very likely to be able to be achieved.
Monica Trauzzi: In his State of the Union address the President called for a decrease in oil consumption by 20 percent over the next 10 years. Does his plan strive for the same goals as California's plan?
Alex Farrell: No, they don't. Some of the goals are the same, certainly reducing petroleum, imports and petroleum consumption is a related issue. However, the President's proposal is rather indiscriminate, that any sort of fuel that is not imported petroleum works, and in particular, fuels are made from fossil sources such as coal to liquids, that if not done with extra technology, which, again, we don't exactly have commercialized yet to control greenhouse gases, would go in the opposite direction of the Low Carbon Fuel Standard in the sense that the coal-to-liquid technologies would have higher greenhouse gas emissions, maybe double as much. And so, in that way, the two policies are definitely not in alignment.
Monica Trauzzi: So it seems like his policy is more focused on energy independence while the California plan is more focused on the environment.
Alex Farrell: The California plan is a balanced plan because it will do both. It will do the environment and it will do energy independence. Whereas, the President's proposal is focused solely on energy supply, notice as well that California's Low Carbon Fuel Standard is embedded in a bigger program for transportation that involves vehicle technologies and it involves land-use and travel options; whereas, the President's proposal is only about the supply of liquid fuels.
Monica Trauzzi: You touched on this earlier. The plan is highly dependent on the market deciding what the best new fuel is. How do you spur consumers to purchase these types of cleaner fuels?
Alex Farrell: Well, one of the interesting pieces of this is the consumer may not need to do anything different. By using a performance standard approach companies are going to figure out what makes sense for their businesses, for their consumers. It may be that the businesses will be simply blending in lower carbon biofuels in the fuels they have today. It may be that other businesses, for instance in the electric power industry, will look to commercialize and work with automakers to commercialize electric vehicles. And it may be that there will be new fuels that we don't have in the marketplace at all, like butanol or others, that are produced, that again, require very little in the sense of the need for the consumers to make a choice.
Monica Trauzzi: If the dependency for oil decreases as a result of using alternative fuels the price of oil will likely go down. How can we be sure that the consumer won't go back to using oil because it's more economically viable for them?
Alex Farrell: That's a good question. It's a performance standard for carbon fuel, so unless the oil production processes become much less carbon intensive then they won't be able to go back. And when I say they, it's the fuel suppliers who are regulated, who are going to be controlled under this law. And they won't be able to go back to the same types of technologies we have today because of the price. What will happen is they will be required to stay with the low carbon trajectory that they are already on.
Monica Trauzzi: Critics of the LCFS in California say that it's not really going to have much of an impact on global warming. Will it?
Alex Farrell: It will have as much of an impact on global warming as any policy in California can have. And I think it will have two important global effects. One is it will stimulate new technologies and it will bring these products into the marketplace where they really will compete. And second, it will demonstrate that it's possible to have an economy thrive with a carbon constraint or with a low greenhouse gas approach and showing that that can be done will be a very powerful symbol.
Monica Trauzzi: Will a LCFS truly only be successful when it's accompanied by other emissions reduction programs and standards?
Alex Farrell: In one sense yes, because the Low Carbon Fuel Standard can only do so much, and so it needs to be in the context of these other programs. But in another sense it will have its own affect in stimulating technologies for low carbon fuels, which we've not yet seen. And that's one of the interesting features of the Low Carbon Fuel Standard, that other approaches that are only about reducing emissions, especially ones that put the entire economy in a single program, are unlikely to be effective in this particular area of developing these new technologies that may offer consumers more choices.
Monica Trauzzi: All right. It's a very interesting topic. We're going to have to end it right there. Thanks for coming on the show.
Alex Farrell: My pleasure.
Monica Trauzzi: This is OnPoint. I'm Monica Trauzzi. Thanks for watching.
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