Commission sets bigger targets for cutting emissions from Oregon fuel suppliers

Oregon fuel distributors will need to move quicker and take stronger action to cut greenhouse gas emissions under new targets approved by the state’s Environmental Quality Commission.

The group of five, governor-appointed members voted Friday to change the timeline for the Clean Fuels Program and increase the emissions targets that fuel distributors in the state will need to hit. 

The program, in effect since 2016, requires companies reduce the carbon intensity of transportation fuels such as diesel and gasoline that they import into Oregon. To do this, companies can import more biofuels, such as those made from ethanol and recycled vegetable oils, or transition to providing other fuel sources for new modes of transportation, such as electricity for electric vehicles. They can also offset some emissions through buying carbon credits from electric utilities. 

Transportation is the single largest source of carbon dioxide emissions in Oregon, making up nearly 40% of the state’s total emissions.

Under the old rules, which went into effect in 2016, companies selling gas and diesel were required to reduce their greenhouse gas emissions 10% below 2015 levels by 2025. Under the new rules, those companies will need to reduce emissions 20% by 2030 and to 37% below 2015 levels by 2035.

A company that might have been reducing emissions by about 1% per year since 2016 to meet the 2025 goal will now need to reduce emissions by about 2% per year to meet new 2030 and 2035 goals. 

By setting more aggressive goals, the commission and the Oregon Department of Environmental Quality hope to incentivize lower-carbon fuel providers to bring their products to Oregon, bring down the cost of electric and hydrogen fuel cell vehicles and reduce air pollution from diesel tailpipes, according to a department news release about the changes.

The Clean Fuels Program has so far helped to stop more than 7 million tons of greenhouse gas emissions from being released and replaced about 1.5 billion gallons of fossil fuels with electricity and alternative fuels. It has provided about $100 million per year to the clean fuels and transportation industries in Oregon, according to the environmental department.

Fossil fuel providers can also offset some emissions by purchasing carbon credits from electric utilities that operate in Oregon. 

Utilities, such as Pacific Power, get credits from the department based on the number of customers who use electric vehicles and charge them at home. Those utilities can then sell those carbon credits to fossil fuel producers and importers to help them meet emissions reduction targets. The utilities, in-turn, use the earnings from selling carbon credits to provide grants to schools and community-based organizations that help to purchase electric vehicles and charging infrastructure. 

So far over $45 million in grants have been awarded to groups such as the Portland NAACP, Meals on Wheels and schools such as Columbia Gorge Community College, Southwestern Oregon Community College and Klamath Community College.