REPORT TO COUNCIL
SUBJECT
Title
Action on the Clean Fuel Reward Program Governance Agreement by and among Pacific Gas and Electric Company, San Diego Gas & Electric Company, Southern California Edison Company, Los Angeles Department of Water & Power, Sacramento Municipal Utility District and the Other Electric Distribution Utilities Party Hereto
Report
BACKGROUND
Pursuant to Assembly Bill (AB 32), the Global Warming Solutions Act of 2006, the California Air Resources Board (CARB) developed the Low Carbon Fuel Standard (LCFS) regulation. CARB adopted the LCFS regulation in 2009 and has amended it a few times, most recently in 2018. The purpose of the regulation is to transform and diversify the transportation fuel pool, reduce petroleum dependency, and reduce emissions of air pollutants and greenhouse gases (GHGs) in California.
The LCFS regulation establishes declining annual performance standards from 2011 through 2030, measured as the average carbon intensity of transportation fuels. It applies to fuel that is sold, supplied, or offered for sale in California, and to any person responsible for that transportation fuel. Regulated entities must meet these standards by reducing the carbon intensity of their fuels and/or retiring LCFS credits.
Providers of clean fuels that already meet the 2020 standard, like electric utilities, may voluntarily opt-in to the LCFS program to generate credits. The largest California Utilities I-Pacific Gas and Electric Company (PG&E), Southern California Edison Company (SCE), and San Diego Gas & Electric (SDG&E), Los Angeles Department of Water and Power, and Sacramento Municipal Utility District -- along with the City of Santa Clara electric utility, Silicon Valley Power (SVP), have opted into LCFS to earn residential Electric Vehicle (EV) charging base credits for supplying electricity for residential charging of EVs.
The LCFS regulation requires utilities, as opt-in regulated credit generators for residential EV charging, ...
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