Cal. Code Regs. tit. 17, § 95489
Provisions for Petroleum-Based Fuels.
Effective Jul 1, 2025Register 2025, No. 26Authority cited: Sections 38510, 38530, 38560, 38560.5, 38562.2, 38571, 38580, 39600, 39601, 41510, 41511 and 43018, Health and Safety Code. Reference: Sections 38501, 38510, 39515, 39516, 38571, 38580, 39000, 39001, 39002, 39003, 39515, 39516, 41510, 41511 and 43000, Health and Safety Code; Section 25000.5, Public Resources Code; 42 U.S.C. Section 7545; and Western Oil and Gas Ass'n v. Orange County Air Pollution Control District, 14 Cal.3d 411, 121 Cal.Rptr. 249 (1975).State of California
(a) Deficit Calculation for CARBOB or Diesel Fuel. A fuel reporting entity for CARBOB or diesel fuel must calculate separately the base deficit and incremental deficit for each fuel or blendstock derived from petroleum feedstock as specified in this provision.
Base Deficit Calculation
)
Incremental Deficit Calculation to Mitigate Increases in the Carbon Intensity of Crude Oil
)
where:
)
mean the amount of LCFS deficits incurred (a negative value), in metric tons, by the volume of CARBOB (XD = “CARBOB”) and diesel fuel (XD = “diesel”) that is derived from petroleum feedstock and is either produced in or imported into California during a specific calendar year;
)
has the same meaning as specified in section 95486.1(a);
)
is the average carbon intensity value of CARBOB or diesel in gCO2e/MJ, that is derived from petroleum feedstock and is either produced in or imported into California during the baseline calendar year, 2010. For purposes of this provision,
)
for CARBOB (XD = “CARBOB”) and diesel fuel (XD = “diesel”) are the Baseline Average carbon intensity values for CARBOB and diesel (ULSD) set forth in Table 7-1. The Baseline Average carbon intensity values for CARBOB and diesel (ULSD) are calculated using data for crude oil supplied to California refineries during the baseline calendar year, 2010.
CIBaselineCrudeAve is the California Baseline Crude Average carbon intensity value, in gCO2e/MJ, attributed to the production and transport of the crude oil supplied as petroleum feedstock to California refineries during the baseline calendar year, 2010. For comparison to CI2024CrudeAve, the baseline is:
)
)
CI20XXCrudeAve is the Three-year California Crude Average carbon intensity value, in gCO2e/MJ, attributed to the production and transport of the crude oil supplied as petroleum feedstock to California refineries during the most recent three calendar years.
For example, the Three-year California Crude Average carbon intensity value for 2024 is:
)
V20XX is the total volume of crude supplied to California refineries during the specified year 20XX.
CI20XX is the Annual Crude Average carbon intensity value, calculated annually as described in section 95489(b). The Annual Crude Average carbon intensity value for 2022 is specified in Table 9.
EXD is the amount of fuel energy, in MJ, determined from the energy density conversion factors in Table 4. For CARBOB (XD = “CARBOB”) or diesel (XD = “diesel”), EXD is either produced in California or imported into California during a specific calendar year and sold, supplied, or offered for sale in California.
)
(b) Addition of Incremental Deficits that Result from Increases in the Carbon Intensity of Crude Oil to a Fuel Reporting Entity's Compliance Obligation.
(1) Incremental deficits for CARBOB or diesel fuel that result from increases in the carbon intensity of crude oil will be calculated and added to each affected fuel reporting entity's compliance obligation for the compliance period in which the
)
become effective, which will be the year following the year in which the CI20XXCrudeAve was established.
(2) Incremental deficits for CARBOB or diesel fuel for each fuel reporting entity will be based upon the amount of CARBOB and diesel fuel supplied by the fuel reporting entity in each compliance period for which the
)
are effective.
(3) Process for Calculating the Annual Crude Average Carbon Intensity Value.
- (A) An Annual Crude Average carbon intensity value will be calculated for each calendar year using a volume-weighted average of crude carbon intensity values. The volume for each imported crude will be the total volume of that crude reported by all fuel reporting entities in the Annual Compliance Reports for the calendar year. Volume contributions for California State fields will be based on oil production data from the California Department of Conservation and volume contributions for California Federal Offshore fields will be based on oil production data from the Bureau of Safety and Environmental Enforcement. Field production volumes for California-produced crude will be reduced, if necessary, to account for crude exports. Crude carbon intensity values are those listed in Table 9. For crude names not listed, the default carbon intensity value from Table 9 will be used until the crude name and carbon intensity value is added to Table 9 as described in section 95489(b)(3).
- (B) After receiving positive or qualified positive verification statements required by section 95500 for all annual MCON reports, the Executive Officer shall post the Annual Crude Average carbon intensity calculation at the LCFS website for public comment. Written comments shall be accepted for 14 days following the date on which the analysis was posted. Only comments related to potential factual or methodological errors in the posted Annual Crude Average carbon intensity value may be considered. The Executive Officer shall evaluate the comments received and, if the Executive Officer deems it necessary, may request in writing additional information or clarification from the commenters. Commenters shall be provided 14 days to respond to these requests. After any comments necessary to be addressed have been addressed, the Executive Officer shall post the final Annual Crude Average carbon intensity value at the LCFS website. An adverse verification statement would result in Executive Officer investigation and may result in delay of finalizing and posting the Annual Crude Average carbon intensity value.
(C) Revisions to the OPGEE model, addition of crudes to Table 9, and updates to all carbon intensity values listed in Table 9 will be considered through proposed amendments of the Low Carbon Fuel Standard regulation.
Table 9. Carbon Intensity Lookup Table for Crude Oil Production and Transport.
Country of Origin
Crude Identifier
Carbon Intensity (gCO2e/MJ)
Baseline Crude Average *
California Baseline Crude Average applicable to crudes supplied during 2024 and subsequent years
12.61
California Baseline Crude Average applicable to crudes supplied during 2022 and 2023
11.78
Annual Crude Average
Volume-weighted California average CI for crudes supplied during 2022
12.71
Algeria
Saharan
17.16
Angola
Cabinda
12.24
Clov
9.11
Dalia
9.92
Gimboa
9.90
Girassol
11.87
Greater Plutonio
11.76
Hungo
10.01
Kissanje
11.75
Mondo
9.92
Nemba
12.21
Pazflor
9.84
Sangos
8.04
Argentina
Canadon Seco
15.30
Escalante
13.81
Hydra
11.88
Medanito
15.44
Australia
Enfield
10.15
Pyrenees
10.11
Stybarrow
10.46
Van Gogh
10.15
Vincent
10.24
Azerbaijan
Azeri
11.09
Belize
Belize Light
10.98
Brazil
Albacora Leste
6.79
Atlanta
7.61
Atapu
8.22
Bijupira-Salema
7.15
Buzios
7.08
Frade
6.95
Iracema
6.88
Jubarte
8.11
Lapa
7.99
Lula
7.55
Marlim
8.35
Marlim Sul
8.56
Ostra
8.01
Papa Terra
5.86
Peregrino
7.60
Polvo
7.70
Roncador
7.19
Roncador Heavy
7.21
Sapinhoa
8.75
Tubarao Azul
8.16
Tubarao Martelo
9.60
Brunei
SLEB
9.88
Cameroon
Lokele
25.56
Canada
Access Western Blend
15.57
Albian Heavy Synthetic (all grades)
24.45
BC Light
10.68
Bonnie Glen
10.68
Borealis Heavy Blend
16.36
Boundary Lake
10.68
Bow River
10.37
Cardium
10.68
Christina Dilbit Blend
14.06
Christina Synbit
18.26
Cold Lake
19.92
Conventional Heavy
10.37
CNRL Light Sweet Synthetic
22.71
Federated
10.68
Fosterton
10.37
Fort Hills Dilbit
12.35
Gibson Light Sweet
10.68
Halkirk
10.68
Hardisty Light
10.68
Herbon
7.48
Hibernia
10.31
Joarcam
10.68
Kearl Lake
12.35
Kerrobert Sweet
10.68
Koch Alberta
10.68
Light Sour Blend
10.68
Light Sweet
10.68
Lloyd Blend
10.37
Lloyd Kerrobert
10.37
Lloydminster
10.37
Long Lake Heavy
25.56
Long Lake Light Synthetic
34.16
Medium Gibson Sour
10.68
Medium Sour Blend
10.68
Midale
10.68
Mixed Sour Blend
10.68
Mixed Sweet
10.68
Moose Jaw Tops
10.68
Peace
10.68
Peace Pipe Sour
10.68
Peace River Heavy
22.50
Peace River Sour
10.68
Pembina
10.68
Pembina Light Sour
10.68
Premium Albian Synthetic
26.12
Premium Conventional Heavy
10.37
Premium Synthetic
26.12
Rainbow
10.68
Rangeland Sweet
10.68
Redwater
10.68
Seal Heavy
10.37
Shell Synthetic (all grades)
26.12
Smiley-Coleville
10.37
Sour High Edmonton
10.68
Sour Light Edmonton
10.68
Suncor Synthetic (all grades)
25.82
Surmont Heavy Blend
22.72
Surmont Heavy Dilbit
17.45
Syncrude Synthetic (all grades)
28.74
Synthetic Sweet Blend
27.28
Tundra Sweet
10.68
Western Canadian Blend
10.37
Western Canadian Select
21.01
Default Dilbit
17.78
Default Synthetic Crude Oil
26.33
Default Synbit
22.52
Chad
Doba
9.77
Colombia
Acordionero
10.22
Cano Limon
10.68
Castilla
12.77
Cusiana
13.81
Magdalena
19.82
Mares Blend
13.67
Rubiales
11.44
South Blend
10.80
Vasconia
11.16
Congo
Azurite
13.76
Djeno
14.25
Ecuador
Napo
11.06
Oriente
11.73
Equatorial Guinea
Ceiba
8.03
Zafiro
20.20
Ghana
Ten Blend
9.17
Iran
Dorood
19.01
Forozan
23.67
Iran Heavy
17.07
Iran Light
18.03
Lavan
15.99
Nowruz-Soroosh
14.28
Sirri
15.64
Iraq
Basra Light
14.01
Basra Medium
13.97
Basra Heavy
13.95
Kuwait
Kuwait
12.93
Libya
Amna
15.58
Es Sider
16.03
Zueitina
16.04
Malaysia
Tapis
18.22
Mauritania
Chinquetti
7.60
Mexico
Isthmus
14.56
Isthmus Topped
17.56
Maya
10.50
Neutral Zone
Eocene
9.36
Khafji
10.43
Ratawi
10.61
Nigeria
Agbami
11.71
Amenam
11.71
Antan
11.71
Bonga
11.71
Bonny
11.71
Brass
11.71
EA
11.71
Erha
11.71
Escravos
11.71
Forcados
11.71
Okono
11.71
OKWB
11.71
Pennington
11.71
Qua Iboe
11.71
Yoho
11.71
Oman
Oman
16.24
Peru
Bretana
8.63
Loreto
12.40
Mayna
12.79
Pirana
11.30
RPS
12.40
Talara
11.81
Russia
CPC
13.60
ESPO
14.93
M100
19.77
Sokol
8.78
Vityaz
12.50
Saudi Arabia
Arab Extra Light
12.04
Arab Light
11.97
Arab Medium
11.48
Arab Heavy
10.50
Thailand
Bualuang
5.75
Trinidad
Calypso
7.31
Molo
15.59
Galeota
13.31
UAE
Murban
12.77
Upper Zakum
10.61
United Kingdom
North Sea Kraken
8.76
Venezuela
Bachaquero
30.58
Boscan
20.64
Hamaca
34.28
Hamaca DCO
16.73
Laguna
30.58
Mesa 30
20.85
Petrozuata (all synthetic grades)
34.33
Santa Barbara
25.48
Zuata (all synthetic grades)
34.28
US Alaska
Alaska North Slope
12.28
US Colorado
Niobrara
9.08
US New Mexico
Four Corners
10.03
New Mexico Intermediate
10.03
New Mexico Sour
10.03
New Mexican Sweet
10.03
US North Dakota
Bakken
12.62
North Dakota Sweet
12.62
Williston Basin Sweet
12.62
US Oklahoma
Oklahoma Sour
12.53
Oklahoma Sweet
12.53
US Texas
Eagle Ford Shale
12.53
East Texas
12.53
North Texas Sweet
12.53
South Texas Sweet
12.53
West Texas Intermediate
12.53
West Texas Sour
12.53
US Utah
Covenant
10.50
Grand Cane
10.50
Utah Black Wax
10.50
Utah Sweet
10.50
US Wyoming
Wyoming Sweet
13.58
US California Fields
Aliso Canyon
6.70
Ant Hill
10.68
Antelope Hills
3.14
Antelope Hills, North
19.96
Arroyo Grande
43.73
Asphalto
10.84
Bandini
1.96
Bardsdale
6.20
Barham Ranch
6.21
Beer Nose
4.35
Belgian Anticline
7.40
Bellevue
5.99
Bellevue, West
3.28
Belmont, Offshore
5.51
Belridge, North
6.20
Belridge, South
20.10
Beverly Hills
6.29
Big Mountain
7.38
Blackwells Corner
2.60
Brea-Olinda
4.40
Buena Vista
9.61
Burrel
13.37
Cabrillo
7.49
Canal
6.91
Canfield Ranch
4.99
Carneros Creek
4.63
Cascade
4.46
Casmalia
9.35
Castaic Hills
2.50
Cat Canyon
19.71
Cheviot Hills
4.68
Chico-Martinez
67.28
Cienaga Canyon
10.75
Coalinga
34.89
Coles Levee, N
5.36
Coles Levee, S
9.04
Comanche Point
4.63
Coyote, East
4.43
Cuyama, South
13.26
Cymric
18.78
Deer Creek
4.42
Del Valle
5.24
Devils Den
3.90
Dominguez
4.47
Edison
18.61
El Segundo
3.96
Elk Hills
12.06
Fruitvale
4.81
Greeley
8.21
Hasley Canyon
3.40
Helm
3.00
Holser
6.10
Honor Rancho
2.72
Huntington Beach
5.63
Hyperion
1.62
Inglewood
10.58
Jacalitos
3.82
Jasmin
15.87
Kern Bluff
7.41
Kern Front
33.38
Kern River
15.17
Kettleman Middle Dome
5.77
Kettleman North Dome
7.48
Landslide
11.51
Las Cienegas
5.00
Livermore
2.84
Lompoc
20.61
Long Beach
5.27
Long Beach Airport
4.38
Los Angeles Downtown
4.99
Lost Hills
16.02
Lost Hills, Northwest
18.85
Lynch Canyon
34.75
Mahala
10.54
McCool Ranch
15.65
McDonald Anticline
2.80
McKittrick
28.52
Midway-Sunset
36.59
Monroe Swell
1.47
Montalvo, West
4.18
Montebello
12.95
Monument Junction
6.86
Mount Poso
3.63
Mountain View
5.03
Newhall-Potrero
5.25
Newport, West
8.90
Oak Canyon
3.49
Oak Park
5.04
Oakridge
5.01
Oat Mountain
4.10
Ojai
7.95
Olive
2.35
Orcutt
23.32
Oxnard
8.99
Paloma
10.13
Placerita
58.44
Playa Del Rey
4.93
Pleito
3.50
Poso Creek
23.70
Pyramid Hills
6.28
Railroad Gap
9.22
Raisin City
28.32
Ramona
7.81
Richfield
3.55
Rincon
6.26
Rio Bravo
10.44
Rio Viejo
2.57
Riverdale
4.07
Rose
3.32
Rosecrans
7.66
Rosecrans, South
6.36
Rosedale
1.85
Rosedale Ranch
9.56
Round Mountain
25.21
Russell Ranch
9.86
Salt Lake
4.35
Salt Lake, South
5.12
San Ardo
23.72
San Emidio Nose
3.13
San Miguelito
6.85
San Vicente
4.16
Sansinena
4.49
Santa Clara Avenue
4.26
Santa Fe Springs
7.75
Santa Maria Valley
8.39
Santa Susana
9.86
Sargent
6.83
Saticoy
5.45
Sawtelle
4.79
Seal Beach
6.06
Semitropic
6.43
Sespe
7.18
Shafter, North
4.14
Shiells Canyon
9.13
South Mountain
6.40
Stockdale
2.42
Tapia
3.76
Tapo Canyon, South
5.24
Tejon
9.59
Tejon Hills
7.90
Tejon, North
8.01
Temescal
3.43
Ten Section
7.50
Timber Canyon
8.68
Torrance
4.02
Torrey Canyon
6.55
Union Avenue
5.55
Vallecitos
5.41
Ventura
7.72
Wayside Canyon
6.09
West Mountain
6.33
Wheeler Ridge
4.86
White Wolf
2.96
Whittier
4.90
Wilmington
16.17
Yowlumne
7.45
Zaca
6.43
US Federal OCS
Beta
3.77
Carpinteria
6.78
Dos Cuadras
6.90
Hueneme
5.80
Point Pedernales
6.49
Santa Clara
5.15
Default
12.61
* Based on production and transport of the crude oil supplied to the indicated California refinery(ies) during the baseline calendar year, 2010.
(c) Credits for Producing and Transporting Crudes using Innovative Methods. Credits may be generated for crude oil that has been produced or transported using innovative methods and delivered to California refineries for processing.
(1) General Requirements.
(A) For the purpose of this section, an innovative method means crude production or transport using one or more of the following technologies:
- 1. Solar steam generation (generated steam of 45 percent quality or greater). Steam must be used onsite at the crude oil production or transport facilities.
- 2. Carbon capture and sequestration (CCS). Carbon capture must take place onsite at the crude oil production or transport facilities from existing anthropogenic sources of CO2.
- 3. Solar or wind electricity generation. To qualify for the credit, electricity must be produced and consumed onsite or be provided directly to the crude oil production or transport facilities from a third-party generator and not through a utility owned transmission or distribution network. Energy storage may be used to increase the quantity of electricity supplied to crude oil production or transport facilities from intermittent solar and wind electricity generation sources.
- 4. Solar heat generation including, but not limited to, boiler water preheating and solar steam generation with a steam quality of less than 45 percent. Heat must be used onsite at the crude oil production or transport facilities.
- 5. Renewable natural gas (RNG) or biogas energy. RNG or biogas must be physically supplied directly to the crude oil production or transport facilities.
(B) The innovative method must become operational no earlier than 2010 for solar steam and CCS projects or January 1, 2015, for any other innovative method above. Any project must be approved for use by the Executive Officer before generating credit under the LCFS regulation. Projects that utilize carbon capture and sequestration are subject to the provisions of section 95490.
No credits may be generated for any quarter preceding the quarter in which the application is approved.
- (C) The project operator must initiate review of the opt-in project using the innovative method through a written application to the Executive Officer. If the innovative method involves steam, heat, RNG, biogas, or electricity produced by a third party and delivered to the crude oil producer or transporter, both the crude producer or transporter and the third party must apply and will be considered joint applicant project operator for approval of the innovative method. If more than one crude producer or transporter receives steam, heat, RNG, biogas, or electricity from a single third-party facility, each crude producer or transporter must submit an independent application with the third party as a joint applicant on each submittal. If the innovative method involves delivery of carbon captured by the crude oil producer or transporter to a third party to store the carbon, both the crude producer or transporter and the third party must apply and will be considered joint applicants for approval of the innovative method.
(D) A crude oil producer or transporter or designated third-party joint applicant must register under section 95483.1 as an opt-in project operator to receive credits for an approved innovative method. The crude oil producer or transporter, through a written agreement, may elect to transfer the right to opt in for credit generation to the joint applicant. If neither the crude oil producer or transporter nor the joint applicant using an approved innovative method registers as an opt-in project operator, credits generated by the producer's or transporter's use of the innovative method may be claimed by California refinery(ies) that purchase the crude produced or transported using the innovative method if CARB receives all information it needs to ensure compliance with limitations and reporting requirements applied to the method.
The innovative method must achieve an emissions reduction of at least 1,000 metric tons CO2e per year.
- (E) If the innovative method involves more than one crude producer or transporter using steam, heat, RNG, biogas, or electricity produced at a single third-party facility, the threshold criteria listed above may apply to the aggregated project total.
(F) Credits for producing crude oil with innovative methods must be calculated as specified below:
For crude oil produced using solar steam generation:
)
Where avoided emissions, as calculated using the OPGEE model assuming displacement of steam produced using a natural gas fired once through steam generator, are correlated with the steam quality as tabulated below:
Steam quality
Avoided emissions (gCO2e/bbl solar steam)
95% and above
33,982
85% to <95%
31,334
75% to <85%
29,001
65% to <75%
26,669
55% to <65%
24,337
45% to <55%
22,004
For crude oil produced or transported using solar or wind based electricity:
)
For crude oil produced or transported using any other innovative method listed in section 95489(c)(1)(A):
CreditsInnov(MT) = ΔCIInnov x EInnov x VInnov x C
where:
CreditsInnov(MT) means the amount of LCFS credits generated (a positive value), in metric tons, by the volume of a crude oil produced or transported using the innovative method and delivered to California refineries for processing;
Vsteam means the overall volume, in barrels cold water equivalent, of steam injected;
fsolar means the fraction of injected steam that is produced using solar;
Vcrudeproduced means the volume, in barrels, of crude oil produced or transported using the innovative method;
VInnov means the volume, in barrels, of crude oil produced or transported using the innovative method and delivered to California refineries for processing. If the crude produced or transported using the innovative method and delivered to California refineries is part of a blend, then VInnov is the volume of blend delivered to California refineries times the volume fraction of the crude within the blend that was produced or transported using the innovative method.
)
Eelectricity means the overall electricity consumption to produce or transport the crude, in kW-hr;
frenew means the fraction of consumed electricity that is produced using qualifying solar or wind power;
ΔCIInnov means the reduction in carbon intensity (a positive value), in gCO2e/MJcrude, associated with crude oil production or transport with the innovative method as compared to crude oil production or transport by a baseline process without the method (hereafter referred to as the comparison baseline method); and
EInnov means the energy density (lower heating value), in MJ/barrel, for the crude oil produced or transported with the innovative method.
- (G) Renewable or low-CI energy sources listed in (A) that are used to generate LCFS credit for innovative crude may not also claim renewable energy certificates or other environmental attributes recognized or credited by any other jurisdiction or regulatory program, other than the market-based compliance mechanism set forth in title 17, California Code of Regulations Chapter 1, Subchapter 10, article 5 (commencing with section 95800). Any renewable energy certificates or other environmental attributes associated with the energy must be retired for the purpose of LCFS credit generation.
(2) Application and Data Submittal. Unless otherwise noted, an application for an innovative method shall comply with the requirements below:
(A) An applicant that submits any information or documentation in support of a proposed innovative method must include with the application a written statement clearly showing that the applicant understands and agrees to the following:
- 1. That all information in the application not identified as confidential business information is subject to public disclosure pursuant to California Code of Regulations, title 17, sections 91000 through 91022 and the California Public Records Act (Government Code §§ 6250 et seq.), and that information claimed by the applicant to be confidential might later be disclosed under section 91022 if the state board determines the information is subject to disclosure.
- 2. That the crude oil producer or transporter or third-party joint applicant must register under section 95483.1 as an opt-in project operator to receive LCFS credit for an innovative method, and that if the crude oil producer or transporter or third-party joint applicant does not register as an opt-in project operator, credits from an approved innovative method may be claimed by California refinery(ies) that purchase crude produced from the innovative method.
(B) An application must contain the following summary material:
- 1. A complete description of the innovative method and how emissions are reduced;
- 2. An engineering drawing(s) or process flow diagram(s) that illustrates the innovative method and clearly identifies the system boundaries, relevant process equipment, mass flows, and energy flows necessary to calculate the innovative method credits;
- 3. A map including global positioning system coordinates for the facilities described in section 95489(c)(2)(B)2.; and
- 4. A preliminary estimate of the potential innovative method credit, calculated as required in section 95489(c)(1)(F), including descriptions and copies of production and operational data or other technical documentation utilized in support of the calculation.
(C) An application, except for solar-generated steam for crude oil production (45 percent steam quality or greater), wind-based electricity, or solar-based electricity, shall include a detailed description of the innovative method and its comparison baseline method. The description of innovative and comparison baseline methods can be limited to those portions of the crude production or transport process affected by the innovative method. The description of the innovative method and its comparison baseline method must include each of the following, to the extent each is applicable to the innovative method:
- 1. Schematic flow charts that identify the system boundaries used for the purposes of performing the life cycle analyses on the proposed innovative method and the comparison baseline method. Each piece of equipment or stream appearing on the process flow diagrams shall be clearly identified and shall include data on its energy and materials balance. The system boundary shall be clearly shown in the schematic.
- 2. A description of all material and energy inputs entering the system boundaries, including their points of origination, modes of transportation, transportation distances, means of storage, and all processing to which material inputs are subject.
- 3. A description of all material and energy products, co-products, by-products, and waste products leaving the system boundaries, including their respective destinations, transportation modes, and transportation distances.
- 4. A description of all facilities within the system boundaries involved in the production or transport of the crude oil and other by-products, co-products, and waste products.
- 5. A description of all combustion and electricity-powered equipment within the system boundaries, including their respective capacities, sizes, or rated power, fuel utilization type, fuel shares, energy efficiency (lower heating value basis), and proposed use.
- 6. A description of the thermal and electrical energy production that occurs within the system boundaries, including the respective capacities, sizes, or rated power, fuel utilization type, fuel shares, energy efficiency (lower heating value basis), and proposed use.
- 7. A description of all sources of flared, vented, and fugitive emissions within the system boundaries, including the compositions of the flared, vented, and fugitive emission streams leaving the system boundaries.
(D) An application, except for solar-generated steam for crude oil production (45 percent steam quality or greater), wind-based electricity, or solar-based electricity shall include descriptions of the life cycle assessments (LCAs) performed on the proposed innovative method and its comparison baseline method using the CARB OPGEE model or an alternative model or LCA methodology approved by the Executive Officer. Electronic copies of the models and calculations shall be provided with the application. The descriptions of the life cycle assessment results must include each of the following:
- 1. Detailed information on the energy consumed, the greenhouse gas emissions generated for the innovative method and the comparison baseline method;
- 2. Documentation of all non-default model input values used in the emissions calculation process. If values for any significant production parameters are unknown, the application shall so state and model default values shall be used for these parameters in the analysis;
- 3. Detailed description of all supporting calculations that were performed outside of the model; and
- 4. Documentation of all modifications other than those covered by subsection 2., above, made to the model. This discussion shall include sufficient specific detail to enable the Executive Officer to replicate all such modifications and, in combination with the inputs and supporting calculations identified in subsections 2. and 3., above, replicate the carbon intensity results reported in the application.
- (E) An application shall include a list of references covering all information sources used in the preparation of the life cycle analysis and calculation of innovative method credit. The reference list must meet the requirements of section 95488.7(a)(2)(D).
- (F) An application shall include a signed transmittal letter from the applicant attesting to the veracity of the information in the application packet and declaring that the information submitted accurately represents the actual and/or intended long-term, steady-state operation of the innovative method described in the application packet. The transmittal letter must meet the requirements of section 95488.8(a)(3)(A) through (D).
- (G) CBI must be designated and a redacted version of any submitted documents designated to include CBI must be provided pursuant to the requirements described in section 95488.8(c).
- (H) An application, supporting documents, and all other relevant data or calculation or other documentation must be submitted electronically via the LRT-CBTS unless the Executive Officer has approved or requested another format.
(3) Application Approval Process. The application must be approved by the Executive Officer before the crude oil producer or transporter, joint applicant, or purchasing refinery may generate credit for the innovative method.
(A) Following receipt of an application designated by the applicant as ready for formal evaluation, the Executive Officer shall advise the applicant in writing either that:
- 1. The application is complete, or
2. The application is incomplete, in which case the Executive Officer will identify which requirements of section 95489(c) have not been met.
- a. The applicant may submit additional information to correct deficiencies identified by the Executive Officer.
- b. If the applicant is unable to achieve a complete application within 180 days of the Executive Officer's receipt of the original application, the application will be denied on that basis, and the applicant will be informed in writing.
- (B) If the Executive Officer deems the application ready for validation, the applicant will be notified through the LCFS Data Management System. The notification will include a list of inputs that demonstrate compliance with the eligibility requirements in section 95489(c)(1) and application requirements in section 95489(c)(2), which are required for validation. The applicant must seek the services of an Executive Officer accredited verification body for validation as specified in section 95500 before the application can be accessed by the verification body. A positive or qualified positive validation statement must be received by the Executive Officer from the verification body in order for CARB's evaluation and certification of the project application to proceed. In cases where a single applicant or a joint applicant does not complete validation, the application will be denied without prejudice. In cases where an applicant cannot complete validation within six months of the verification body receiving the application from CARB, or the applicant receives an adverse validation statement, the application will be denied without prejudice.
- (C) After receiving a positive or qualified positive validation statement, the Executive Officer will post the application at http://www.arb.ca.gov/fuels/lcfs/lcfs.htm. Public comments will be accepted for 14 days following the date on which the application was posted. Only comments related to potential factual or methodological errors may be considered. The Executive Officer will forward to the applicant all comments identifying potential factual or methodological errors. Within 30 days, the applicant shall either submit revisions to its application to the Executive Officer, or submit a detailed written response to the Executive Officer explaining why no revisions are necessary.
(D) The Executive Officer shall not approve an application if the Executive Officer determines, based upon the information submitted in the application and any other available information, that:
- 1. The proposed crude production or transport method is not an innovative method, as that term is defined in section 95489(c)(1).
- 2. Based upon the application information submitted pursuant to this section, the applicant's greenhouse gas emissions calculations cannot be replicated using the CARB OPGEE model or alternative model or LCA methodology approved by the Executive Officer.
- (E) As part of any action approving an application, the Executive Officer may prescribe conditions of the approval that contain special limitations, recordkeeping and reporting requirements, and operational conditions that the Executive Officer determines should apply to the innovative method. If the Executive Officer determines the application will not be approved, and the applicant will be notified in writing and the basis for the disapproval shall be identified.
(4) Recordkeeping and Reporting. Each applicant that receives approval for an innovative method must maintain records identifying each facility at which it produces crude oil for sale in California under the approved innovative method. For each such facility, the regulated entity must report quarterly or annually (through a Project Report). A regulated entity electing to report annually is required to submit its annual Project Report to CARB for the previous compliance year by April 30 of each year. Records of each such facility must be maintained for at least ten years showing:
- (A) The volume (barrels) of crude oil produced or transported using the approved innovative method and the crude name(s) under which it is marketed.
- (B) If the crude oil produced or transported with an approved innovative method is marketed as part of a crude blend that is not wholly refined in California, the name of the blend and the volume fraction that the crude produced with the innovative method contributes to the blend.
- (C) For crude oil imported into California, documentation showing that the innovative crude was supplied to one or more California refinery and the volume (barrels) of innovative crude supplied to each California refinery. For crude oil produced in California, documentation showing the innovative crude was supplied to one or more California refinery, the total volume (barrels) of innovative crude supplied to California refineries, and the total volume (barrels) of innovative crude exported from California.
(D) For solar or wind electricity projects, the following additional recordkeeping and reporting will be required:
- 1. Metered data on solar or wind electricity consumed at the crude oil production or transport facilities during the reporting period (kWh);
- 2. Metered data on total electricity consumed at the crude oil production or transport facilities during the reporting period (kWh); and
- 3. An attestation letter stating that all solar or wind electricity was supplied directly for crude oil production or transport and that the solar or wind electricity reported for generating LCFS credit did not produce renewable energy certificates or other environmental attributes recognized or credited by any other jurisdiction or regulatory program, other than the market-based compliance mechanism set forth in title 17, California Code of Regulations Chapter 1, Subchapter 10, article 5 (commencing with section 95800).
(E) For solar steam projects at crude oil production facilities, the following additional recordkeeping and reporting will be required:
- 1. Metered data on solar steam consumed for crude oil production at the oil field during the reporting period (barrels cold water equivalent);
- 2. Metered data on total steam consumed for crude oil production at the oil field during the reporting period (barrels cold water equivalent);
- 3. Volume-weighted average steam quality for solar steam consumed for crude oil production at the oil field during the reporting period; and
- 4. An attestation letter stating that all solar steam was supplied directly for crude oil production at the oil field and that the solar steam reported for generating LCFS credit did not produce renewable energy certificates or other environmental attributes recognized or credited by any other jurisdiction or regulatory program, other than the market-based compliance mechanism set forth in title 17, California Code of Regulations Chapter 1, Subchapter 10, article 5 (commencing with section 95800).
(F) Any additional records that the Executive Officer requires to be kept in pursuant to section 95489(c)(3)(E), and records that demonstrate compliance with all special limitations and operating conditions specified pursuant to section 95489(c)(3)(E).
These records shall be submitted to the Executive Officer during the quarterly or annual reporting period specified in section 95491(b).
- (5) Credits for Producing or Transporting Crude Oil Using Innovative Methods. Credits for producing or transporting crude oil using innovative methods may be generated quarterly or annually, at the discretion of the credit generating party. After receiving reports from California refineries detailing crude names and volumes supplied to the refineries during the applicable crediting period, any records requested of the applicant under section 95489(c)(4), and a positive or qualified positive verification of the applicable Project Reports per section 95500, the Executive Officer will determine the number of credits to be issued to the crude oil producer or transporter, joint applicant, or purchasing refinery for the innovative method. An adverse verification statement would result in no credit issuance and Executive Officer investigation. Except for carbon capture and sequestration (CCS) projects, the crediting period for projects eligible for credit generation pursuant to section 95489(c) will end no later than December 31, 2040.
(d) Low-Complexity/Low-Energy-Use Refinery Credit. A refinery may receive credit for being a low-complexity and low-energy-use refinery.
(1) To be eligible for the credit calculation in section 95489(d)(3), a Low-Complexity/Low-Energy-Use Refinery must meet the criteria in the definition of “Low-Complexity/Low-Energy-Use Refinery” provided in section 95481(a) using the following equations:
(A) Modified Nelson Complexity Score
)
where:
indexi is the 2012 Nelson Complexity Index listed in Table 10;
Capacityi is the capacity of each unit listed in Table 10 in barrels per day unless otherwise indicated;
Capacitydist is the capacity of the distillation unit in barrels per day;
i is the process unit; and
n is the total number of process units.
Table 10. Nelson Complexity Indices.
Process Unit
Index Value
Atmospheric Distillation
1.00
Vacuum Distillation
1.30
Thermal Processes
2.75
Delayed and Fluid Coking
7.50
Catalytic Cracking
6.00
Catalytic Reforming
5.00
Catalytic Hydrocracking
8.00
Catalytic Hydrorefining/Hydrotreating
2.50
Alkylation
10.00
Polymerization
10.00
Aromatics
20.00
Isomerization
3.00
Oxygenates
10.00
Hydrogen (MMcfd)
1.00
Sulfur Extraction (Metric Tons per day)
240.00
(B) Annual Energy Use
Annual Energy Use (in MMBtu) = fuel use + electricity + thermal
where:
fuel use is the MMBtu of all fuel combusted during the compliance period;
electricity is the imported electricity minus exported electricity per compliance period converted to MMBtu by using 3.142 MMBtu/MWh; and
thermal is the imported thermal energy minus exported thermal energy per compliance period in MMBtu.
(2) In addition to other reporting requirements, a refinery operator that is claiming credits for a Low-Complexity/Low-Energy-Use Refinery must also report the following volumes produced during a specific calendar year and sold, supplied, or offered for sale in California for that refinery:
- (A) The volume of CARBOB and volume of diesel produced from crude oil;
- (B) The volume of CARBOB and volume of diesel produced from transmix;
- (C) The volume of CARBOB and volume of diesel produced from Petroleum Intermediate feedstocks; and
- (D) The volume of CARBOB and volume of diesel purchased for blending.
- (E) If CARBOB or diesel is produced from feedstock other than crude oil (volumes in (2)(B) through (D), above), a separate annual report with third-party verification is required for produced volumes of CARBOB and diesel from crude oil. The annual report must be submitted by April 30 and the verification statement is due August 31.
(3) Credits for a low-complexity/low-energy-use refinery must be calculated using the following equations:
- (A) Carbon Intensity Adjustment. For volumes reported in section 95489(d)(2)(A) a non-transferable credit of 5.0 gCO2e/MJ will be generated.
(B) Credit Calculation. For CARBOB and diesel volumes reported in section 95489(d)(2)(A):
)
where:
)
is the amount of LCFS credits generated (a zero or positive value), in metric tons, by a fuel or blendstock under the average carbon intensity requirement for gasoline (XD = “gasoline”) or diesel (XD = “diesel”);
VFXD means the volume fraction of CARBOB (XD = “CARBOB”) or diesel (XD = “diesel”) fuel that is derived from crude oil supplied to the Low-Complexity/Low-Energy-Use refinery. VFXD is calculated by dividing the volume of CARBOB or diesel reported for section 95489(d)(2)(A) by the total volume of CARBOB or diesel reported for section 95489(d)(2)(A) through (D);
EXD is the amount of fuel energy, in MJ, from CARBOB (XD = “CARBOB”) or diesel (XD = “diesel”), determined from the energy density conversion factors in Table 4, either produced in California or imported into California during a specific calendar year and sold, supplied, or offered for sale in California; and
)
- (C) Credits created pursuant to section 95489(d) may not be sold or transferred to any other party.
(4) Application Contents and Submittal. An application for Low-Complexity/Low-Energy-Use Refinery Credits must comply with the following requirements:
(A) An application must contain the following summary material:
- 1. A complete description of the refinery including processing units and their capacity, and energy use;
- 2. An engineering drawing(s) or process flow diagram(s) that illustrates the project, relevant process equipment, and mass or volumetric flows necessary to calculate the Low-Complexity/Low-Energy-Use Refinery Credits; and
- 3. A preliminary estimate of the credit, calculated as required in section 95489(d)(3)(B), including descriptions and copies of production and operational data other technical documentation utilized in support of the calculation.
- (B) An application must include a list of references covering all information sources used in the calculation of Low-Complexity/Low-Energy-Use Refinery Credits. The reference list must meet the requirements of section 95488.7(a)(2)(D).
- (C) An application must include a signed transmittal letter from the applicant attesting to the veracity of the information in the application packet and declaring that the information submitted accurately represents the actual operation of the refinery. The transmittal letter must meet the requirements of section 95488.8(a)(3)(A) through (D).
- (D) An applicant that submits any information or documentation in support of a proposed Low-Complexity/Low-Energy-Use Refinery Credit must include a written statement clearly showing that the applicant understands and agrees that all information in the application not identified as confidential business information is subject to public disclosure pursuant to California Code of Regulations, title 17, sections 91000 through 91022 and the California Public Records Act (Government Code, §§ 6250 et seq.), and that information claimed by the applicant to be confidential might later be disclosed under section 91022 if the Board determines the information is subject to disclosure.
- (E) An application, supporting documents, and all other relevant data or calculation or other documentation must be submitted electronically via the LRT-CBTS unless the Executive Officer has approved or requested another format.
- (F) If there is a change to an approved Low-Complexity/Low-Energy-Use Refinery which could impact the eligibility of the refinery, the refinery operator must notify the Executive Officer in writing within 30 days after the material change has occurred, and the previously-approved application shall become invalid 30 days after the material change has occurred.
(5) Credit Issuance. The Executive Officer will issue Low-Complexity/Low-Energy-Use Refinery Credits annually for the prior year upon the completion of the following:
- (A) Confirmation of eligibility by the Executive Officer based on the refinery energy use verified under MRR annually.
- (B) Receipt of a positive or qualified positive verification statement for the quarterly fuel transactions reported pursuant to section 95489(d)(2). An adverse verification statement would result in no credit issuance and Executive Officer investigation.
- (C) The crediting period for projects eligible for credit generation pursuant to section 95489(d) will end no later than December 31, 2040.
(e) Refinery Investment Credit Program. A refinery, or a hydrogen production facility physically providing hydrogen to a refinery, may receive credit for reducing greenhouse gas emissions from its facility. For projects at hydrogen production facilities not owned by the refinery, the refinery and hydrogen production facility must apply as joint applicants. Any such credits must be based on fuel volumes sold, supplied, or offered for sale in California as set forth below.
(1) General Requirements.
- (A) The application for a refinery investment credit must be submitted during or after the year 2016 and must be approved pursuant to this section before the refinery or hydrogen production facility can receive credit. A project is eligible if the project completion date is on January 1, 2016, or later.
- (B) The refinery investment credit project must occur within the boundaries of the refinery or hydrogen production facility. Sequestration sites for CCS do not need to be on-site at the refinery or hydrogen production facility.
- (C) The applicant must demonstrate that any net increases in criteria air pollutant or toxic air contaminant emissions from the refinery investment credit project are mitigated in accordance with all local, state, and national environmental and health and safety regulations.
(D) The following project types are eligible for the refinery investment project credits:
- 1. CO2 capture from existing anthropogenic sources at refineries, or at hydrogen production facilities that supply hydrogen to refineries, and subsequent geologic sequestration;
- 2. Use of renewable or low-CI electricity supplied behind the meter at refineries or at hydrogen production facilities;
- 3. Use of lower-CI process energy such as biomethane, renewable propane, and renewable coke, to displace fossil fuel at refineries or hydrogen production facilities. Lower-CI process energy must be physically supplied directly to the refineries;
- 4. Electrification at refineries or hydrogen production facilities that involves substitution of high carbon fossil energy input with grid electricity.
- 5. Process improvement projects that deliver a reduction in baseline refinery-wide greenhouse gas emissions as outlined in 95489(e)(1)(J). Greenhouse gas emissions reductions due to curtailment, simple maintenance; and crude oil switching that results in greenhouse gas reductions in the project system boundary without improvements in the processing units or equipment involved are not eligible. For the purposes of this section, curtailment is defined as an intentional operational and/or physical change exclusively for the reduction or cessation of total gasoline and gasoline blendstocks and diesel production at the refinery or hydrogen production at the hydrogen production facility. Curtailment does not include the coincidental rate reduction or shutdown of associated emitting equipment as part of a process improvement project or projects aimed primarily at optimizing refinery or hydrogen production efficiency.
- (E) Credits must be pro-rated for years where the units within the project system boundary were non-operational. This pro-rating will consider the days of operation relative to non-operation.
- (F) Credits must be pro-rated if the hydrogen production facility does not supply all of its hydrogen to the applicant refinery.
(G) Credits generated pursuant to section 95489(e)(1)(D)5. are subject to the following limitations:
- 1. Credits may not be used to meet more than 10 percent of any entity's annual compliance obligation. The Executive Officer will exclude incremental deficits incurred pursuant to section 95489(b) when assessing this 10 percent limitation.
- 2. Crediting is limited to 15 years from the quarter in which the Executive Officer approves the project's application.
- (H) Projects that utilize carbon capture and sequestration are subject to the provisions of section 95490.
- (I) The project operator must provide a written application to the Executive Officer. If the project involves lower-CI process energy or renewable or low-CI electricity produced by a third party and delivered to the refinery or hydrogen production facility, both the refinery or hydrogen production facility and the third party must apply and will be considered joint applicant project operator for approval of the project. If more than one refinery or hydrogen production facility receives lower-CI process energy or renewable or low-CI electricity from a single third-party facility, each refinery or hydrogen production facility must submit an independent application with the third party as a joint applicant on each submittal. If the project involves delivery of carbon captured by the refinery or hydrogen production facility to a third party to store the carbon, both the refinery or hydrogen production facility and the third party must apply and will be considered joint applicants for approval of the project.
- (J) Applications submitted pursuant to section 95489(e)(1)(D) must demonstrate an emissions reduction of at least 10,000 metric tons CO2e per year or one percent of the facility's annual pre-project emissions, whichever is less.
- (K) Renewable or low-CI energy sources listed in section 95489(e)(1)(D) that are used to generate LCFS credit may not also claim renewable energy certificates or other environmental attributes recognized or credited by any other jurisdiction or regulatory program, other than the market-based compliance mechanism set forth in title 17, California Code of Regulations, Chapter 1, Subchapter 10, Article 5 (commencing with section 95800). Any renewable energy certificates or other environmental attributes associated with the energy must be retired on behalf of the LCFS.
(2) Calculation of Credits.
- (A) For carbon capture and sequestration projects, determine the credit in accordance with sections 95489(e)(2), 95490, and the CCS protocol.
(B) For other refinery investment credit projects, determine the credit as follows:
- 1. Establish a project system boundary. The project system boundary should include direct impacts and at least first order indirect impacts;
2. Determine the credit for the refinery investment credit project by calculating pre-project life cycle greenhouse gas emissions and project life cycle greenhouse gas emissions within the project system boundary;
)
where:
CreditRIP is the annual credit for the refinery investment credit project in metric tons per year;
GHGpre -- project is the annual life cycle greenhouse gas emissions from the use of fuels, electricity, steam/heat and hydrogen in the project system boundary prior to project implementation in metric tons per year corrected for downtime;
GHGpost -- project is the annual life cycle greenhouse gas emissions from the use of fuels, electricity, steam/heat and hydrogen in the project system boundary due to project implementation in metric tons per year corrected for downtime;
VolumeXD is the volume of gasoline, gasoline blendstocks, and diesel in gallons per quarter or per year produced at the refinery and sold, supplied, or offered for sale in California by the refinery involved in the Refinery Investment Credit Program; and
VolumeTotal is the total volume of gasoline, gasoline blendstocks, and diesel in gallons produced at the refinery per quarter or per year.
(3) Application Contents and Submittal. Unless otherwise noted, an application for refinery investment credits must comply with the following requirements:
(A) An application must contain the following summary material:
- 1. A complete description of the refinery investment credit project and how emissions are reduced;
- 2. An engineering drawing(s) or process flow diagram(s) that illustrates the project and clearly identifies the system boundaries, relevant process equipment, mass flows, and energy flows necessary to calculate the refinery investment credits, including any directly affected or indirectly affected processing units (at least first order indirect impacts) and a whole refinery diagram if requested; and
- 3. A preliminary estimate of the refinery investment credit, calculated as required in section 95489(e)(2), including descriptions and copies of any available production and operational data including energy use and other technical documentation utilized in support of the calculation. The application must contain process-specific data showing that the reductions are part of the transportation fuel pathway.
- 4. Supporting documents demonstrating that second or higher order indirect impacts are not significant beyond the identified project system boundary.
- (B) An application must include a list of references covering all information sources used in the calculation of refinery investment credit. The reference list must meet the requirements of section 95488.7(a)(2)(D).
- (C) An application must include a signed transmittal letter from the applicant attesting to the veracity of the information in the application packet and declaring that the information submitted accurately represents the actual and/or intended long-term, steady-state operation of the refinery investment credit project described in the application packet. The transmittal letter must meet the requirements of section 95488.8(a)(3)(A) through (D).
- (D) CBI must be designated and a redacted version of any submitted documents designated to include CBI must be provided pursuant to the requirements described in section 95488.8(c).
- (E) An application must include all relevant documentation identifying any changes, including decreases or increases, in criteria air pollutant or toxic air contaminant emissions based on local air permits and supporting permit documentation from the refinery investment credit project. An applicant must include a signed transmittal letter from the applicant attesting that any net increases in emissions from the refinery investment credit project are mitigated in accordance with all local, state, and national environmental and health and safety regulations.
- (F) An applicant that submits any information or documentation in support of a proposed refinery investment credit must include a written statement clearly showing that the applicant understands and agrees that all information in the application not identified as confidential business information is subject to public disclosure pursuant to California Code of Regulations, title 17, sections 91000 through 91022 and the California Public Records Act (Government Code, §§ 6250 et seq.), and that information claimed by the applicant to be confidential might later be disclosed under section 91022 if the Board determines the information is subject to disclosure.
- (G) An application, supporting documents, and all other relevant data or calculation or other documentation must be submitted electronically via the LRT-CBTS unless the Executive Officer has approved or requested another format.
- (H) Applications for process improvement projects must be submitted on or before December 31, 2025.
(4) Application Approval Process. An application must be approved by the Executive Officer before the refinery investment credit project can generate credits under the LCFS regulation.
(A) After receipt of an application designated by the applicant as ready for formal evaluation, the Executive Officer will advise the applicant in writing either that:
- 1. The project system boundary is appropriate and the application is complete, or
- 2. The application is incomplete, in which case the Executive Officer will identify which requirements of section 95489(e) have not been met. The applicant may submit additional information to correct deficiencies identified by the Executive Officer. If the applicant is unable to achieve a complete application within 180 days of the Executive Officer's receipt of the original application, the application will be denied on that basis, and the applicant will be informed in writing.
- (B) If the Executive Officer deems the application ready for validation, the applicant will be notified through the LCFS Data Management System. The notification shall include a list of inputs that demonstrate compliance with the eligibility requirements in section 95489(e)(1) and application requirements in section 95489(e)(3), which are required for validation. The applicant must seek the services of an Executive Officer accredited verification body for validation as specified in section 95500 before the application can be accessed by the verification body. A positive or qualified positive validation statement must be received by the Executive Officer from the verification body in order for CARB's evaluation and certification of the project application to proceed. In cases where a single applicant or a joint applicant does not complete validation, the application will be denied without prejudice. In cases where an applicant cannot complete validation within six months of the verification body receiving the application from CARB, or receives an adverse validation statement, the application will be denied without prejudice.
- (C) After receiving a positive or qualified positive validation statement, the Executive Officer will post the application at http://www.arb.ca.gov/fuels/lcfs/lcfs.htm. Public comments will be accepted for 14 days following the date on which the application was posted. Only comments related to potential factual or methodological errors may be considered. The Executive Officer will forward to the applicant all comments identifying potential factual or methodological errors. Within 30 days, the applicant must either submit revisions to its application to the Executive Officer, or submit a detailed written response to the Executive Officer explaining why no revisions are necessary.
- (D) If the Executive Officer finds that an application meets the requirements set forth in section 95489(e), the Executive Officer will take final action to approve the refinery investment credit project. The Executive Officer may prescribe conditions of approval that contain special limitations, recordkeeping and reporting requirements, and operational conditions that the Executive Officer determines should apply to the project. If the Executive Officer finds that an application does not meet the requirements of section 95489(e), the application will not be approved, and the applicant will be notified in writing, and the basis for the disapproval will be identified.
(E) The Executive Officer shall not approve an application if the Executive Officer determines, based upon the information submitted in the application and any other available information, that:
- 1. The proposed project does not meet the requirements set forth in section 95489(e).
- 2. Based upon the application information submitted pursuant to this section, the applicant's greenhouse gas emissions calculations cannot be replicated.
(5) Reporting, Credit Review, and Issuance. For each approved refinery investment credit project, the regulated entity must report quarterly or annually through a Project Report. A regulated entity electing to report annually is required to submit its annual Project Report to CARB for the previous compliance year by April 30 of each year. Credits for refinery investment projects may be generated quarterly or annually, at the discretion of the credit generating party.
- (A) Upon the completion of reporting period in which a positive or qualified positive verification statement for the applicable Project Reports per section 95500(e) is received, the Executive Officer will determine the number of credits to be issued to the applicants. An adverse verification statement would result in no credit issuance and Executive Officer investigation.
- (B) Except for CCS projects, the crediting period for projects eligible for credit generation pursuant to section 95489(e) will end no later than December 31, 2040.
- (6) Recordkeeping. For each approved refinery investment credit project, the regulated entity must compile and retain records pursuant to section 95491.1(a)(2) showing compliance with all limitation and recordkeeping requirements identified by the Executive Officer pursuant to section 95489(e)(4)(D), above.
(f) Renewable Hydrogen Refinery Credit Program. A refinery, or a hydrogen production facility physically providing hydrogen to a refinery, may receive credit for greenhouse gas emission reductions from the production of CARBOB or diesel fuel that is partially or wholly derived from renewable hydrogen. For projects at hydrogen production facilities not owned by the refinery, the refinery and hydrogen production facility must apply as joint applicants. Any such credits must be based on fuel volumes sold, supplied, or offered for sale in California as set forth below.
(1) General Requirements.
- (A) In order to receive a renewable hydrogen refinery credit, a refiner must produce CARBOB or diesel fuel that is partially or wholly derived from renewable hydrogen.
- (B) The applicant must demonstrate that any net increases in criteria air pollutant or toxic air contaminant emissions from the renewable hydrogen refinery credit project are mitigated in accordance with all local, state, and national environmental and health and safety regulations.
- (C) The project operator must submit a written application to the Executive Officer. If the project involves renewable natural gas or electricity produced by a third party and delivered to the refinery or hydrogen production facility, both the refinery or hydrogen production facility and the third party must apply and will be considered joint applicant project operator for approval of the project. If more than one refinery or hydrogen production facility receives renewable natural gas or electricity from a single third-party facility, each refinery or hydrogen production facility must submit an independent application with the third party as a joint applicant on each submittal.
- (D) Applications submitted pursuant to section 95489(f) must demonstrate a generation of at least 10,000 credits or one percent of the facility's annual pre-project emissions, whichever is less.
- (E) Renewable or low-CI energy sources that are used to produce renewable hydrogen and generate LCFS credit may not also claim renewable energy certificates or other environmental attributes recognized or credited by any other jurisdiction or regulatory program, other than the market-based compliance mechanism set forth in title 17, California Code of Regulations, Chapter 1, Subchapter 10, Article 5 (commencing with section 95800). Any renewable energy certificates or other environmental attributes associated with the energy used to produce renewable hydrogen must be retired on behalf of the LCFS.
(2) Calculation of Credits.
(A) For CARBOB or diesel fuel that is partially or wholly derived from renewable hydrogen produced from RNG that displaces fossil natural gas in a steam methane reforming unit, the calculation of credits generated quarterly or annually must be as follows:
)
where:
)
is the amount of LCFS credits generated (a zero or positive value), in metric tons, by renewable hydrogen;
CING is the well-to-hydrogen production carbon intensity of North American pipeline natural gas in gCO2e/MJ calculated using the same feedstock assumptions and pipeline distance as the Lookup Table pathway for Pipeline Average North American Fossil Natural Gas (CNGF);
CIRNG is the well-to-hydrogen production carbon intensity of the RNG in gCO2e/MJ and must be determined using the CAGREET4.0 model unless the Executive Officer has approved the use of a method that is at least equivalent to the calculation methodology used by CA-GREET4.0 model. The process for obtaining CIRNG will be identical to Tier 2 fuel pathway applications, and the life cycle steps evaluated will stop at hydrogen production at the refinery;
ERNG is the amount of RNG in MJ that displaces fossil natural gas for hydrogen production at a refinery or a facility providing hydrogen to a refinery per quarter or per year;
VolumeXD is the volume of gasoline, gasoline blendstocks, and diesel in gallons per quarter or per year produced at the refinery and sold, supplied, or offered for sale in California by the refinery;
VolumeTotal is the total volume of gasoline, gasoline blendstocks, and diesel in gallons produced at the refinery per quarter or per year; and
)
(B) For CARBOB or diesel fuel that is partially or wholly derived from renewable hydrogen produced from other production processes, such as electrolysis using renewable electricity or syngas from biomass gasification, the calculation of credits generated quarterly or annually must be as follows:
)
where:
)
is the amount of LCFS credits generated (a zero or positive value), in metric tons, by renewable hydrogen;
)
is the carbon intensity of fossil hydrogen in gCO2e/MJ delivered or produced at the refinery, as determined using the CA-GREET4.0 model or similar models approved by the Executive Officer. The process for obtaining
)
must comply with the requirements in sections 95488 to 95488.10;
)
is the carbon intensity of renewable hydrogen in gCO2e/MJ delivered or produced at the refinery, as determined using the CA-GREET4.0 model. The process for obtaining
)
must comply with the requirements in sections 95488 to 95488.10;
)
is the amount of renewable hydrogen in kg per quarter or per year;
)
is the energy density of hydrogen in MJ/kg from Table 4;
VolumeXD is the volume of gasoline, gasoline blendstocks, and diesel in gallons per quarter or per year sold, supplied, or offered for sale in California by the refinery involved in the Renewable Hydrogen Refinery Credit Program;
VolumeTotal is the total volume of gasoline, gasoline blendstocks, and diesel in gallons produced at the refinery per quarter or per year; and
)
(3) Application Contents and Submittal. Unless otherwise noted, an application for renewable hydrogen credits must comply with the following requirements:
(A) An application must contain the following summary material:
- 1. A complete description of the production of CARBOB or diesel fuel with hydrogen and how renewable hydrogen is replacing fossil hydrogen in that process;
- 2. Purchase records identifying the renewable hydrogen and/or renewable feedstock used to produce the renewable hydrogen; and
- 3. A preliminary estimate of the renewable hydrogen refinery credit, calculated as required in section 95489(f)(2), including descriptions and copies of production and operational data, including energy use, and other technical documentation utilized in support of the calculation. The application must contain process-specific data showing that the reductions are part of the transportation fuel pathway.
- (B) An application must include a list of references covering all information sources used in the calculation of renewable hydrogen refinery credit project. The reference list must meet the requirements of section 95488.7(a)(2)(D).
- (C) An application must include a signed transmittal letter from the applicant attesting under penalty of perjury under California law, to the veracity of the information in the application packet and declaring that the information submitted accurately represents the actual and/or intended long-term, steady-state operation of renewable hydrogen refinery credit project described in the application packet. The transmittal letter must meet the requirements of section 95488.8(a)(3)(A) through (D).
- (D) CBI must be designated and a redacted version of any submitted documents designated to include CBI must be provided pursuant to the requirements described in section 95488.8(c).
- (E) An application must include all relevant documentation identifying any changes, including decreases or increases, in criteria air pollutant or toxic air contaminant emissions based on local air permits from the renewable hydrogen refinery credit project. An applicant must include a signed transmittal letter from the applicant attesting that any net increases in emissions from renewable hydrogen refinery credit project are mitigated in accordance with all local, state, and national environmental and health and safety regulations.
- (F) An application, supporting documents, and all other relevant data or calculation or other documentation must be submitted electronically via the LRT-CBTS unless the Executive Officer has approved or requested another format.
(4) Application Approval Process. An application must be approved by the Executive Officer before the renewable hydrogen refinery credit project can generate credits under the LCFS regulation.
(A) Following receipt of an application designated by the applicant as ready for formal evaluation, the Executive Officer will advise the applicant in writing either that:
- 1. The application is complete, or
- 2. The application is incomplete, in which case the Executive Officer will identify which requirements of section 95489(f) have not been met. The applicant may submit additional information to correct deficiencies identified by the Executive Officer. If the applicant is unable to achieve a complete application within 180 days of the Executive Officer's receipt of the original application, the application will be denied on that basis, and the applicant will be informed in writing.
- (B) If the Executive Officer deems the application ready for validation, the applicant will be notified through the LCFS Data Management System. The notification will include a list of inputs that demonstrate compliance with the eligibility requirements in section 95489(f)(1) and application requirements in section 95489(f)(3), which are required for validation. The applicant must seek the services of an Executive Officer accredited verification body for validation as specified in section 95500 before the application can be accessed by the verification body. A positive or qualified positive validation statement must be received by the Executive Officer from the verification body in order for CARB's evaluation and certification of the project application to proceed. In cases where a single applicant or a joint applicant does not complete validation, the application will be denied without prejudice. In cases where an applicant cannot complete validation within six months of the verification body receiving the application from CARB, or the applicant receives an adverse validation statement, the application will be denied without prejudice.
- (C) After receiving a positive or qualified positive validation statement, the Executive Officer will post the application at http://www.arb.ca.gov/fuels/lcfs/lcfs.htm. Public comments will be accepted for 14 days following the date on which the application was posted. Only comments related to potential factual or methodological errors may be considered. The Executive Officer will forward to the applicant all comments identifying potential factual or methodological errors. Within 30 days, the applicant must either submit revisions to its application to the Executive Officer, or submit a detailed written response to the Executive Officer explaining why no revisions are necessary.
(D) The Executive Officer shall not approve an application if the Executive Officer determines, based upon the information submitted in the application and any other available information, that:
- 1. The proposed project does not meet the requirements set forth in section 95489(f).
- 2. Based upon the application information submitted pursuant to this section, the applicant's greenhouse gas emissions calculations cannot be replicated.
- (E) If the Executive Officer finds that an application meets the requirements set forth in section 95489(f), the Executive Officer will take final action to approve the renewable hydrogen refinery credit project. The Executive Officer may prescribe conditions of approval that contain special limitations, recordkeeping and reporting requirements, and operational conditions that the Executive Officer determines should apply to the project. If the Executive Officer finds that an application does not meet the requirements of section 95489(f), the application will not be approved, and the applicant will be notified in writing, and the basis for the disapproval will be identified.
(5) Reporting, Credit Review, and Issuance. For each approved renewable hydrogen refinery credit project, the regulated entity must report quarterly or annually through a Project Report. A regulated entity electing to report annually is required to submit its annual Project Report to CARB for the previous compliance year by April 30 of each year. Credits for renewable hydrogen refinery projects may be generated quarterly or annually, at the discretion of the credit generating party.
- (A) Upon the completion of reporting period in which a positive or qualified positive verification statement for the applicable Project Reports per section 95500(e) is received, the Executive Officer will determine the number of credits to be issued to the applicants. An adverse verification statement would result in no credit issuance and Executive Officer investigation.
- (B) The crediting period for projects eligible for credit generation pursuant to section 95489(f) will end no later than December 31, 2040.
- (6) Recordkeeping. For each approved renewable hydrogen refinery credit project, the regulated entity must compile and retain records pursuant to section 95491.1(a)(2) showing compliance with all limitation and recordkeeping requirements identified by the Executive Officer pursuant to section 95489(f)(4)(F), above.
Note: Authority cited: Sections 38510, 38530, 38560, 38560.5, 38562.2, 38571, 38580, 39600, 39601, 41510, 41511 and 43018, Health and Safety Code. Reference: Sections 38501, 38510, 39515, 39516, 38571, 38580, 39000, 39001, 39002, 39003, 39515, 39516, 41510, 41511 and 43000, Health and Safety Code; Section 25000.5, Public Resources Code; 42 U.S.C. Section 7545; and Western Oil and Gas Ass'n v. Orange County Air Pollution Control District, 14 Cal.3d 411, 121 Cal.Rptr. 249 (1975).
History
1. New section filed 1-12-2010; operative 1-12-2010 pursuant to Government Code section 11343.4 (Register 2010, No. 3).
2. Repealer and new section filed 11-16-2015; operative 1-1-2016 (Register 2015, No. 47).
3. Amendment filed 1-4-2019; operative 1-4-2019 pursuant to Government Code section 11343.4(b)(3) (Register 2019, No. 1).
4. Amendment of section and Note filed 6-27-2025; operative 7-1-2025 (Register 2025, No. 26).