RFA Questions CARB On LCFS Compliance Issues
December 14, 2009 - Washington – In a letter sent to the California Air Resources Board (CARB) on Friday, Renewable Fuels Association (RFA) President and CEO Bob Dinneen expressed concern that the agency was about to implement regulations on its low carbon fuel standard (LCFS) without having the appropriate reporting and compliance mechanisms in place.
According to RFA’s letter to Dean Simeroth, Chief of the Criteria Pollutants Branch at CARB, “Many of our member companies, including both ethanol producers and marketers, have raised numerous questions regarding LCFS reporting and compliance requirements. Unfortunately, the final regulation order and the supporting materials released Nov. 25, 2009, did little to address these lingering questions and concerns.”
The LCFS is scheduled for implementation Jan. 1, 2010, about 10 business days away. The first year of the program will require quarterly and annual reports, though mandatory greenhouse gas reductions will not be enforced until 2011. However, the means of demonstrating compliance with the program and submitting reports is still unavailable to regulated parties and many other questions loom regarding reporting and compliance requirements.
“With the CARB about to implement far reaching regulations for its Low Carbon Fuel Standard, it is vital that the agency have in place all of the methods and systems necessary to collect information to make the program operate,” said Dinneen. “Unfortunately, those methods and systems are not in place – a situation which is likely to cause confusion and delay in getting the program up and running.”
Among the many issues it specifically identified, the RFA questioned:
• reporting requirements for ethanol producers when ownership of fuel is
transferred once the fuel is inside the State of California;
• CARB’s definition of “neat ethanol;”
• what definition was being applied for the various physical pathways over which
ethanol can be shipped into California;
• if CARB was developing a standardized application form for the submission of
information on delivery methods;
• the short time frame for approval of applications documenting the delivery
methods (“physical pathway”) suppliers will use;
• why the CARB had not yet publicly released its online Compliance and
Reporting Tool (CRT) and when it intended to do so;
• what steps the CARB had taken to protect trade secrets and confidential
business information for companies submitting information and reports.
Dinneen’s letter summed up the industry’s concerns by stating, “It is incomprehensible that implementation of a regulation could occur before the means of demonstrating compliance is completed and accessible to regulated parties. For these reasons and others, we believe the Office of Administrative Law will be forced to return the LCFS package to CARB and require the agency to complete its unfinished work related to the compliance and reporting system.”
Read the full letter here.
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