State lawmakers trying to enact a low carbon fuel standard (LCFS) during last year’s session unsuccessfully attempted to make a deal with opponents in the state Senate to get it passed. Now, Senate Transportation Committee Chair Steve Hobbs (D-44) is perhaps signaling he’s open to such a proposal, the details of which he hinted at during a March 16 vote on E3SHB 1091 in the Senate Environment, Energy & Technology Committee.
Although he didn’t vote in favor of the bill, Hobbs said: “I am open to this. I am hopeful that there might be a path forward” if the LCFS bill included “triggering language and some offramps.”
Before the bill reaches the Senate floor, it must first clear the Senate Ways and Means Committee, then the Senate Transportation Committee. However, in the latter is where it is expected to receive its stiffest pushback from Hobbs, who is currently working on a new transportation package in conjunction with a Senate cap-and-trade proposal. That committee is where several prior LCFS proposals have met their demise.
Hobbs mentioned that the cap-and-trade legislation sponsored by Environment, Energy & Technology Committee Chair Reuven Carlyle (D-36) “applies to transportation fuels, the very same thing the LCFS is trying to do.”
E3SHB 1091, sponsored by Rep. Joe Fitzgibbon (D-34), aims to reduce transportation sector carbon emissions through carbon intensity limits on fuel sources. Entities that provide fuel below the limit generate credits that can then be sold to entities with fuel above the limit. Various fuels are exempt from the program, but those entities can still generate credits if they offer clean fuel.
Debate over its purported environmental benefits is mainly confined to Republican lawmakers. Sen. Doug Ericksen (R-41) introduced various amendments during the March 16 committee hearing highlighting Washington’s miniscule emissions compared to total global greenhouse gases (GHG); roughly .0021 percent of total global emissions. One amendment would have required the program prove it and all other state carbon reduction policies will reduce global GHG by .2 percent.
Rather, the wedge between LCFS advocates and opponents such as Hobbs is the expected increase to gas prices as the program is implemented. Hobbs noted that the added fuel cost is “not going to transportation. It’s going to biofuel manufacturers.”
A 2019 Puget Sound Clean Air Agency (PSCAA) analysis of a regional LCFS estimated it could raise gas prices by up to $.57 per gallon by 2030; the current state gas tax rate is $.49 per gallon. In California, the state nonpartisan Legislative Analyst’s Office (LAO) released a report in 2018 that concluded the LCFS program it had there added $.13 per gallon and could add a total of $.46 per gallon by 2030.
LCFS advocates point to Oregon’s program, which has only raised gas prices by $.27 per gallon.
Voting without recommendation on the bill, Hobbs said at the March 16 committee meeting “in the realm of transportation….that is a lot of money for preservation and maintenance that we can do,” which Washington State Department of Transportation (WSDOT) officials have warned is grossly underfunded. He added that a gas tax increase of that amount “almost pays for the culverts” on WSDOT highways that need to be replaced by 2030 under a U.S. court order.
While supporters say an LCFS program would inspire new biofuel production in the state, Hobbs argued that won’t happen until reforms to the permitting process are made, citing the recent decision by Department of Ecology to deny necessary permits for the Kalama methanol plant because it would increase state carbon emissions but reduce overall global emissions.
E3SHB 1091 will be referred to the Ways and Means Committee.