In Texas, Argus Media reports California unveiled significantly stricter carbon reduction targets for transportation fuels including a cap at 20% per year on credits generated from soybean- and canola-oil-derived biodiesels starting in 2028. This move is intended to curb the overwhelming supply of credits, which surged due to the increased use of renewable diesel and natural gas, causing a credit glut and a slump in market prices.
The immediate market reaction was a 26% spike in LCFS credit trading, signaling renewed investor confidence in the robustness of California’s environmental policies. Public consultations will continue until August 27, with a formal board vote scheduled for November 8.
Under the revised Low Carbon Fuel Standard regulations released by the California Air Resources Board, the state will enhance the annual reduction targets for gasoline and diesel by 9% in 2025, a substantial increase from the typical 1.25% reduction and initially proposed 5% cut.
This policy shift aligns with Governor Gavin Newsom’s broader strategy for a lower-carbon economy, although it notably retreats from including jet fuels in the immediate mandate—a decision influenced by industry feedback warning of potential non-compliance.
Tags: California, carbon, Texas
Category: Policy
