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In September 2016, California put into law statewide goals to reduce greenhouse gas (GHG) emissions including 40% below
1990 levels by 2030 and 80% below 1990 levels by 2050. To help achieve these goals California has a number of policy
initiatives including the Short-Lived Climate Pollutant (SLCP) Reduction Strategy and the Low Carbon Fuel Standard (LCFS).
The SLCP Reduction Strategy identifies a range of options for accelerating short-lived climate emission reductions including
regulation, incentives, and other market supporting activities. The SLCP Reduction Strategy was approved in March 2017 with
implementation beginning in January 2018. The LCFS which has been in place since 2009 is designed to encourage the use of
cleaner low-carbon fuels by creating market incentives for near-term GHG reductions, and has a goal of reducing the overall
carbon intensity of fuel within the transportation sector 10% by 2020. With California’s transportation sector accounting
for 37% of the State’s overall GHG emissions, achieving California’s climate goals will require significant technological and
market changes within the transportation sector. To help transform California’s transportation market, the California Energy
Commission administers the Alternative and Renewable Fuel and Vehicle Technology Program (ARFVTP) which provides up
to $100 million annually to develop and deploy a portfolio of alternative fuel and advanced vehicle technologies, including the
production of biofuels. Biofuels including gasoline substitutes, diesel substitutes, and biomethane are anticipated to provide
immediate and long-term opportunities to reduce both GHG emissions and petroleum use. Through the ARFVTP the Energy
Commission has awarded $167 million to 59 biofuel projects, ranging from bench-scale to commercial production, with
the goal of expanding the production of low-carbon, economically competitive biofuels from waste-based and renewable
feedstocks in California.