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State rule edges state closer to higher gas costs

January 21, 2015

By Associated Oregon Industriesaoi

On Wednesday, January 7, the Environmental Quality Commission (EQC) adopted rules necessary to implement the Low Carbon Fuel Standard (also known as the clean fuels program). By a 4-1 vote, the EQC approved rules to require importers of transportation fuels to reduce the average carbon intensity of fuels they provide in Oregon in order to meet annual clean fuel standards. The goal of the rule is to gradually reduce transportation fuel’s carbon content by 10% over 10 years.

To meet the standards, regulated parties would need to blend diesel and gasoline with lower-carbon fuels such as: biofuels, natural gas, biogas, propane or electricity into its fuel mix; and eventually need to purchase clean fuel “credits.” In essence, the program begins as a fuel blending mandate and graduates to a carbon credit purchasing program.

Nevertheless, DEQ’s regulatory authority is set to sunset this year. As a result, the Legislature will debate whether the sunset should be retained, extended or removed. It will be a contentious issue during the Legislative Session and likely influence the Legislature’s ability to pass a transportation bill.

AOI has opposed the program and is working closely with Oregonians for Sound Fuel Policy, a broad coalition of labor, businesses, contractors, transportation, farmers and ranchers. Business owners, especially those of small businesses, form the backbone of Oregon’s economy and have an important story to tell. If you would like to help, please contact Mike Freese at AOI or Oregonians for Sound Fuel Policy.

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