The biofuel industry is still figuring out the long-term effects of the California Air Resource Board’s Low Carbon Fuel Standard vote that passed back in November.
The long-awaited amendments include a 20% limit on credits for renewable diesel produced from soybean, canola and sunflower oils and authorize CARB to stop accepting new biodiesel and renewable diesel pathways in 2031 if certain ZEV targets are met.
Scott Gerlt, chief economist at American Soybean Association, said he’s hoping CARB will soon open up their indirect land use change modeling for changes, as the models are out of date and yet make up half of soybean’s carbon intensity score in California. Currently, Gerlt said CARB has a high ILUC penalty for soy.
Though other models would have lower ILUC scores for soybeans, Gerlt said other groups have been adamant that the score should be even higher. He projects that their next step is keeping track of CARB’s model updating process to “make sure it's done correctly” and hopefully improve soy’s ILUC score.
Other concerns include more stringent CI requirements — a double-edged sword. While Gerlt said CI requirements could increase credit values, they will likely also phase out soy products a lot sooner.
Based on CARB data, Gerlt estimates that close to 30% of California biodiesel feedstocks are produced from canola and soy. On top of that, the new sustainability guardrails add an extra cost for producers, which Gerlt said their supply chains are not prepared for. Those requirements phase in starting next year, which he said is very soon given implementation has yet to take effect and farmers are starting to purchase inputs now for their planting season next year
"It's not as always as easy as is one would think, because it comes down to even [the] definition of a farm," Gerlt said, such as the need to provide attestations of when a farm changed ownership or what practices are used on the land.
Jeff Earl, director of state governmental affairs for Clean Fuels Alliance America, said as of today their members make up nearly 75% of California’s diesel pool and nearly 45% of credits. He sees the regulation as a backstep from the state’s transition away from petroleum.
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“Biomass-based diesel has stepped up … the 20% cap really took us by surprise and is really still something that we're digging through as an industry to really understand the long-term impacts of that and what opportunities we're going to have in the future,” Earl said.
Clean Fuels Director of Public Affairs Paul Winters previously said that the LCFS vote would cause California-based renewable diesel refineries to rely on waste feedstocks, which Earl said is now a reality.
“We definitely support the use of tallow and used cooking oils and things of that nature,” he said. “But we also want to make sure that there's a level playing field for all feedstocks.”
Earl added that corrections to Global Trade Analysis Project modeling, the primary model used by CARB to analyze land use impacts, would be one way to correct that imbalance. He noted that Purdue University has updated research demonstrating that the model could improve a CI score for feedstocks.
Both Earl and Gerlt see the cap on soy credits as arbitrary when considering its already high ILUC penalty.
“It's the point we will continue to raise, as there's really a very strong inconsistency now because of just adding on different items to address the same issue,” Gerlt said.
During the 2025 Clean Fuels Conference on Tuesday, CARB Executive Officer Steven Cliff said CARB’s decision to amendment LCFS was initiated by a desire to accelerate decarbonization without regulatory updates. He said without amendments, the rule would have targeted 20% CI reduction in 2030 and stayed there indefinitely.
They found that existing regulatory stringency would “stifle future investments,” strand clean fuel production assets and ignore other greenhouse gas reductions.
He explained that the sustainability guardrails are intended to “avoid potential future land use changes associated with crop based biofuels,” but noted that they “stop short of explicitly tapping biofuel, despite the many, many calls from environmental and EJ communities to do so.”
During a panel discussion on California’s clean fuels landscape, retired CARB staffer and former director of state governmental affairs at Clean Fuels Floyd Vergara commended the acceleration mechanism that allows the program to automatically respond to emissions reductions when met.
“I think there's still a lot of work to be done to improve the science that was the basis for a number of outcomes from the rulemaking,” Vergara said, naming the feedstock caps and sustainability provisions. “But I'm confident that we'll be able to work with our staff to update that science.”
Once CARB receives its approval from the Office of Administrative Law — pending litigation in response to LCFS — Cliff said staff will work on establishing a sustainable aviation working group, host a meeting on land use change and increase “the transparency around program outcomes.”
OAL has until Feb. 18, to make a determination on the final regulation order, which was submitted on Jan.3.
“We have no plans to slow down, and we're prepared to defend our critical clean air regulations and our initiatives as necessary,” Cliff said.
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