You'd never know it from the media's focus on today's Supreme Court decisions on contraception and labor union rights, but the Court also took a move that was arguably more important: It rejected the oil industry's challenge to California's Low Carbon Fuel Standard, or LCFS.
The LCFS, established in 2007, assigns a carbon-intensity score to each source of transportation fuel consumed in California. The calculations account for the greenhouse gases generated in each step of producing, refining and transporting the fuel. The scores, modeled and calculated by Adam Brandt, a professor of energy resources engineering at Stanford University, effectively force California fuel distributors to discriminate against dirtier sources of oil such as Canada's tar sands.
After a barrage of lawsuits by the oil and ethanol industriesa federal trial judge blocked the LCFS in 2011. A federal appeals court reversed that ruling last year, after which the industry groups appealed the case to the Supreme Court. Today's court decision gives California policymakers a huge boost, and gives companies a clear mandate: Stop complaining and get with the program.
The LCFS requires a phased reduction in the carbon intensity of transportation fuels in the state, leading to a 10 percent reduction by 2020. This target has been forecasted to result in a reduction of approximately 16 million metric tons (MMt) of greenhouse gas emissions annually, thus achieving roughly 10 percent of California's emissions reduction goal. For context, consider that this LCFS reduction is about three-fifths of the projected annual emissions from the Keystone XL pipeline, which the U.S. EPA has calculated at 27.6 million MMt annually. Ask yourself: Has the LCFS received three-fifths of the passion and publicity of the Keystone XL?
For more information about the benefits of California's LCFS, see a lengthy report issued today by Environmental Defense Fund and the American Lung Association.
Oil firms vote "no" on California crude. Another piece of good news for California environmentalists comes from the oil patch. According to the latest rig count by Baker Hughes, a leading oil services firm, the drilling boom in Texas is continuing with no letup, with with 887 oil and gas drilling rigs operating in the state, or 26 percent of all rigs on Earth. California lags way behind with only 48 rigs operating. For context, consider that California currently has about one-sixth of Texas' total oil output yet has only 5 percent of the drilling. It's a telling sign of a topic I've discussed at length previously -- that despite the many-sided hype around fracking in the Monterey Shale, no such boom is likely to occur, and oil companies know it.
New flexibility for wind and solar. Under the category of Wonky and Obscure News comes another item with potential importance for the state's renewable energy markets. As Greenwire reports (sub required):
Federal energy regulators today signed off on a politically popular plan that allows California's grid manager to launch a voluntary "real time" energy market and share its electricity resources with five Western states.
The Federal Energy Regulatory Commission unanimously voted to conditionally accept the California Independent System Operator's (ISO) proposal -- as made through tariff revisions -- to design an energy imbalance market, or EIM, which pools energy resources in parts of Oregon, Washington, Utah, Wyoming and Idaho.
State grid operators have proposed to launch the market on Oct. 1.
This could be a big deal, allowing the more effective integration of wind and solar sources into the state's grid despite their inherent erratic nature. The Los Angeles Times explains it well, quoting Steve Berberich, chief executive of the California state grid, Cal ISO:
FERC said it is hopeful that the market will be able to better manage the influx of renewable power sources, such as solar and wind-generated electricity, the supply of which is inconsistent.
Currently, 38 energy authorities from Canada to Mexico balance and manage energy fluctuations on their own power grids. The new system is a major first step toward organizing the market and saving consumers money, Berberich said.
A study by Cal-ISO and PacifiCorp of the benefits from an energy imbalance market projected annual consumer benefits of as much as $129 million from economic efficiencies, improved use of renewable power sources and increased reliability.
“The market will also lessen the environmental footprint of the energy system by allowing more renewable in and lowering cost,” Berberich said.