A low-carbon fuel standard (LCFS) is an emissions trading rule designed to reduce the average carbon intensity of transportation fuels in a given jurisdiction, as compared to conventional petroleum fuels, such as gasoline and diesel. The most common methods for reducing transportation carbon emissions are supplying electricity to electric vehicles, supplying hydrogen fuel to fuel cell vehicles and blending biofuels, such as ethanol, biodiesel, renewable diesel, and renewable natural gas into fossil fuels. The main purpose of a low-carbon fuel standard is to decrease carbon dioxide emissions associated with vehicles powered by various types of internal combustion engines while also considering the entire life cycle ("well to wheels"), in order to reduce the carbon footprint of transportation.
The first low-carbon fuel standard mandate in the world was enacted by California in 2007, with specific eligibility criteria defined by the California Air Resources Board (CARB) in April 2009 but taking effect in January 2011. Similar legislation was approved in British Columbia in April 2008, and by European Union which proposed its legislation in January 2007 and which was adopted in December 2008. The United Kingdom is implementing its Renewable Transport Fuel Obligation Program, which also applies the concept of low-carbon fuels.
Several bills have been proposed in the United States for similar low-carbon fuel regulation at a national level but with less stringent standards than California. As of early 2010 none have been approved. The U.S. Environmental Protection Agency (EPA) issued its final rule regarding the expanded Renewable Fuel Standard (RFS2) for 2010 and beyond on February 3, 2010. This ruling, as mandated by the Energy Independence and Security Act of 2007 (EISA), included direct emissions and significant indirect emissions from land use changes.
Californian Governor Arnold Schwarzenegger issued Executive Order S-1-07 on January 19, 2007, to enact a low-carbon fuel standard (LCFS).
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The indirect land use change impacts of biofuels, also known as ILUC or iLUC (pronounced as i-luck), relates to the unintended consequence of releasing more carbon emissions due to land-use changes around the world induced by the expansion of croplands for ethanol or biodiesel production in response to the increased global demand for biofuels. As farmers worldwide respond to higher crop prices in order to maintain the global food supply-and-demand balance, pristine lands are cleared to replace the food crops that were diverted elsewhere to biofuels' production.
The United States became the world's largest producer of ethanol fuel in 2005. The U.S. produced 15.8 billion U.S. liquid gallons of ethanol fuel in 2019, and 13.9 billion U.S. liquid gallons (52.6 billion liters) in 2011, an increase from 13.2 billion U.S. liquid gallons (49.2 billion liters) in 2010, and up from 1.63 billion gallons in 2000. Brazil and U.S. production accounted for 87.1% of global production in 2011. In the U.
Brazil is the world's second largest producer of ethanol fuel. Brazil and the United States have led the industrial production of ethanol fuel for several years, together accounting for 85 percent of the world's production in 2017. Brazil produced 26.72 billion liters (7.06 billion U.S. liquid gallons), representing 26.1 percent of the world's total ethanol used as fuel in 2017. Between 2006 and 2008, Brazil was considered to have the world's first "sustainable" biofuels economy and the biofuel industry leader, a policy model for other countries; and its sugarcane ethanol "the most successful alternative fuel to date.
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