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Archive for October, 2023

CA LCFS: 1.6M Net Credits in Q2

Posted October 31st, 2023 by SRECTrade.

The California Air Resources Board (CARB) published Q2 2023 data for the Low Carbon Fuel Standard (LCFS) today. Consistent with trends dating back to 2021, low carbon fuel producers generated 1.6M more credits than deficits, pushing the cumulative credit bank to over 18M credits. 

Source: California Air Resources Board

Record Credit Generation

More credits were generated in Q2 (5.5M) than in any previous quarter of the program, led by increases from the largest credit sources: renewable diesel (14%), renewable natural gas (28%), and electricity (7%). Two key trends underpin the consistent growth in net credits: 54% of diesel sold in CA last quarter came from renewable feedstocks while the average carbon intensity (CI) of renewable natural gas fell to its lowest mark of -131 g/MJ. 

There was also a 50% increase in credits from alternative jet fuel (also referred to as sustainable aviation fuel) which still represents less than 1% of all credits. Meanwhile, there were modest declines in credits from ethanol (-11%), propane (-11%), and biodiesel (-5%).

Source: California Air Resources Board

EV Credits Rebound

Credits from EV charging bounced back from a quarterly decline in Q1, driven by increases in both light-duty (12%) and heavy-duty (11%) on-road EV charging. Residential EV charging still made up about half of all EV credits, ahead of forklifts (23%) and on-road EVs (18%). Credits from DC fast-charging infrastructure rose by about 12%. Overall, EVs are the second largest source of credits, representing about one-quarter of all credits in the program. 

Source: California Air Resources Board

Credit Prices Hover Above Six-Month Low

LCFS credit prices closed October around $68/credit, up slightly from six-month lows in September following CARB’s publication of a regulatory document which hinted at major program changes including the strengthening of CI targets and limitations on biomethane crediting. CARB is expected to publish its final proposal by December, which triggers a 45-day public comment period before the governing board can approve rule changes. 

Source: California Air Resources Board

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Adjustable Block Program – SRECTrade No Longer Filing Extensions for Interconnection Deadlines

Posted October 17th, 2023 by SRECTrade.

Due to SRECTrade’s retirement as an Approved Vendor in the Illinois Adjustable Block Program on August 10th, 2022 (see this blog post for more information), extensions will no longer be filed for projects who have not met their interconnection deadlines.

Adjustable Block Program (ABP) projects are awarded a contract after their Part I approval. The project then has 12 or 18 months to provide energization documents and be submitted for Part II approval. In the past, SRECTrade has filed extensions on behalf of projects that required more time. Beginning in November, 2023, any projects that have not been Part II submitted by their deadline will be canceled with SRECTrade. This will result in the forfeit of the application and collateral fees (that are non-refundable once awarded a contract), and will require the project to be resubmitted through a different approved vendor to participate in the ABP program.

SRECTrade will continue to provide services for all applications that are Part II submitted prior to their energization deadline. To help ensure your application is not canceled, please submit any outstanding documents 6 weeks prior to your deadline.

SRECTrade looks forward to continuing service of its Designees and existing clients during the remainder of their participation in the ABP.

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First Look at Washington CFS Data

Posted October 2nd, 2023 by SRECTrade.

The first batch of data for the new Washington Clean Fuels Standard (CFS) has been made available by the Washington State Department of Ecology. So far, Ecology has published:

Credit Transfer Reports for July and August 2023

No credits were transferred in July after technical issues with the Washington Fuel Reporting Systems triggered a one-month delay in the first issuance of credits. However, 27,055 credits were transferred in August. The average price from the four reported trades was $106.66. The price of Washington CFS credits was about midway between those reported in CA ($77) and OR ($137) during the same month. Credits from one program cannot be sold in another. 

Q1 2023 Credit and Deficits

Ecology reported 275k credits generated and 227k deficits generated, a net credit build of about 47k credits. Entities with compliance obligations do not have to retire credits until next year, and credits do not expire so they may be held indefinitely by market participants. 

The largest source of credits was ethanol (75%), followed by renewable diesel (12.1%), biodiesel (11.8%), and electricity (10.8%). Credits from residential EV charging, which are separately calculated and issued by Ecology, have not yet been issued for Q1 or Q2.

The deadline for reporting fuel consumption for the Q2 2023 reporting period is today. Ecology has not yet set a publication schedule for reporting quarterly credit and deficit data.

Source: Washington Department of Ecology

What’s Next for the Washington CFS?

Ecology will create a zero-emission vehicle infrastructure or “capacity credit” program for public DC fast-charging and hydrogen refueling stations. Stations approved under this program may generate CFS credits based on the fueling capacity of those stations. Guidance on this program is expected to be released before the end of the year. 

Ecology must also address the inclusion of alternative jet fuel pathways in the CFS after the passage of SB 5447. A rulemaking may be initiated as soon as this year or early next year.

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