Senators and witnesses at a hearing Wednesday expressed sharp differences over the need for – and impacts of – a potential national low carbon fuel standard.
Concerns over the value of a new approach that would go beyond the Renewable Fuel Standard centered on how a new standard would be developed and the speed with which the country can decarbonize the transportation fleet, as well as the fuels used to move it.
Low-carbon and clean fuels programs like those in California, Oregon and Washington set carbon intensity scores for transportation fuels, allowing the generation of credits that can be sold by low-carbon fuel providers. In California, dairies using anaerobic digesters have benefited from the program by producing biogas for transportation.
In contrast, the existing federal Renewable Fuel Standard identifies eligible biofuels to be blended into the nation's fuels supply through the setting of annual volume targets.
Delaware Democrat Tom Carper, chairman of the Senate Environment and Public Works Committee, touted existing programs, saying they “have successfully advanced the production and use of cleaner fuels, kept consumer and compliance costs low, and fostered local investment and job creation.”
“My hope is today's conversation will be the start of more conversations (among) my colleagues … and other stakeholders” on what a national LCFS would look like, he said.
But Ranking Member Shelley Moore Capito, R-W.Va., said she was “very concerned by the concept of empowering bureaucrats to decide what fuel sources qualify, how, and what associated phase-outs may look like.” She also blamed state efforts such as California’s LCFS for raising gas prices.
Other Republicans, including Sens. Cynthia Lummis, R-Wyo., and Markwayne Mullin, R-Okla., also warned of pitfalls along the road to a national LCFS.
“I have concerns that creating a national low carbon fuel standard will only galvanize efforts to enact another anti-consumer regulatory scheme, such as phasing out liquid fuels through electrification mandates are banning heavy-duty diesel engines,” Lummis said.
At least one biofuels group said the committee needed to reach out more broadly on the issue. Michael McAdams, CEO of the Advanced Biofuels Association, urged EPW “to consider the full scope of America’s low-carbon transportation fuel infrastructure in pursuit of their goal, including the advanced biofuels that are proven to reduce GHG emissions by as much as 80 percent.”
Carper focused much of his attention on the potential for hydrogen as a fuel source, saying that “unlike existing state-level programs, the (RFS) does not currently consider hydrogen a clean fuel. Increasing the production and use of clean hydrogen is key to reducing emissions in sectors of our economy that are difficult to decarbonize.”
But on that score, he faced some skepticism from his own party. Sen. Jeff Merkley, D-Ore., said depending on the source, hydrogen can be worse for the climate than natural gas.
“The hydrogen conversation is going to be very relevant as we go forward,” Merkley said. “And when it's made from electrolysis, that is from renewable electricity … it has a profoundly different footprint than when it's made from fracked methane gas.”
Others were supportive of hydrogen, however, with Senate Agriculture Committee Chairwoman Debbie Stabenow, D-Mich., and Sen. Ben Cardin, D-Md., both mentioning hydrogen research and development in their states.
One witness, American Air Liquide Holdings CEO Michael Graff, whose research and development facility is in Delaware, said “if we are going to achieve our climate objectives, if the energy transition is going to occur, it will not happen without hydrogen. The estimate is that hydrogen itself, long term by 2050, will likely account for roughly 20% of the world's energy supply.” The company is currently building a unit in Oberhausen, Germany, to produce renewable hydrogen by electrolysis.
Stabenow said the shift to cleaner transportation fuels will take time.
“I'm all for transitions, and I want to see us get to electric vehicles,” she said, but added that “the U.S. fleet is going to be comprised of hundreds of millions of internal combustion engines for years to come.”
Stabenow and Renewable Fuels Association President and CEO Geoff Cooper, another witness at the hearing, were both in agreement that internal combustion engines will be prevalent in the nation's vehicle fleet for years to come. But Cooper also used the conversation to push a familiar biofuels industry talking point; electric vehicles might offer decarbonization in the future, but biofuels can offer it today.
“If we're serious about reducing greenhouse gas emissions as quickly as possible, we can't wait around for full electrification of the fleet,” Cooper said. “That's going to take decades. There are roughly 270 million light-duty vehicles, cars, pickups, SUVs and vans. Today, 1% of those are electric vehicles. So it's going to take decades for that transition to occur.”
Sen. Pete Ricketts, R-Neb., echoed Cooper, stating “ethanol must be central to any discussion that we're going to have on the future of transportation fuels.”
Cooper also criticized EPA’s approach in a recent proposal to allow the use of e-RINS in the RFS. Under that proposal, manufacturers of electric vehicles would be eligible for the credits, something Cooper said is completely different, completely inconsistent with how RIN credit generation is done across any other fuel that is regulated under the RFS.”
He said RFA is also concerned that under EPA’s proposal, automakers would benefit from “book and claim” accounting, which would allow a manufacturer to “sign a contract with a renewable electricity producer who could be thousands of miles away. And when that electron enters the grid, the automaker gets to claim that carbon reduction benefit from that electron, whether it ever gets used to fuel an electric vehicle or not.”
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