WEBVTT - Democrats Torn Over Pursuing Low-Carbon Fuel Policies

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<v Speaker 1>Some states are trying to make gasoline more climate change friendly,

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<v Speaker 1>but they're facing some stiff opposition to that from environmentalists.

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<v Speaker 1>What's going on here? Stay tuned to find out. Hello,

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<v Speaker 1>and welcome back Wanting into Parts per Billion, the environmental

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<v Speaker 1>podcast from Bloomberg Law. I'm your host, David Schultz. Maybe

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<v Speaker 1>it's just me, but whenever I'm driving, I'm kind of always,

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<v Speaker 1>maybe barely aware that at all times there are a

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<v Speaker 1>lot of greenhouse gases coming out of my tailpipe. What

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<v Speaker 1>if it weren't a lot, though, What if we could

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<v Speaker 1>make it so that there weren't so many of those

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<v Speaker 1>heat trapping emissions that are coming out of my car? Well,

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<v Speaker 1>apparently we can. Gasoline with low or at least lower

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<v Speaker 1>carbon intensity exists, and as of now, there are three

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<v Speaker 1>states that incentivized fuel producers who make it. That's three

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<v Speaker 1>out of fifty states. Surely there are other climate mighted

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<v Speaker 1>states that want to get in on this, right Well,

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<v Speaker 1>that's the topic of today's podcast, and to discuss this,

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<v Speaker 1>we have on Bloomberg Law reporters Zach Bright. Zach wrote

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<v Speaker 1>a story about why blue states are trying to pass

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<v Speaker 1>new low carbon fuel standards and failing and I wanted

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<v Speaker 1>to figure out what's going on here, But first I

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<v Speaker 1>wanted to figure out exactly what low carbon fuel really is.

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<v Speaker 1>So these standards that I covered are standards that certain places,

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<v Speaker 1>states in particular, have put into place to lower carbon

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<v Speaker 1>emissions from transportation vehicles. And basically what that means is

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<v Speaker 1>that these states want fuel providers to require their fuels

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<v Speaker 1>to have lower carbon outputs, and they do that by

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<v Speaker 1>giving you know, fueld providers that do that credits. And

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<v Speaker 1>that's what a low carbon fuel standard at the basic

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<v Speaker 1>level is, you know, awarding fueld providers gas stations that

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<v Speaker 1>offer lower carbon options to eventually you reach a certain

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<v Speaker 1>lower limit. And it sounds like there are a lot

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<v Speaker 1>of different ways to do that. I mean, we were

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<v Speaker 1>talking before we started recording, but there's a national renewable

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<v Speaker 1>fuel standard that requires gasoline providers to add a little

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<v Speaker 1>bit of ethanol or maybe more than a little bit

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<v Speaker 1>of ethanol into fuel. But I get the sense that

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<v Speaker 1>on the state level it's a little bit different. Can

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<v Speaker 1>you go into that. Yeah, So that's right. We have

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<v Speaker 1>a national renewable fuel standard. I think it was put

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<v Speaker 1>into place about a decade and a half ago. And

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<v Speaker 1>that basically requires fuel providers to put a certain amount

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<v Speaker 1>of ethanol, and that's a by volume standard. So the

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<v Speaker 1>goal there as an oh, we want less carbon emissions,

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<v Speaker 1>it's oh, we want our gasoline or diesel fuel to

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<v Speaker 1>contain a certain amount of ethanol. The low carbon fuel

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<v Speaker 1>standard is i would say, a bit newer in the

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<v Speaker 1>sense that it's primarily targeting emissions for the sake of

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<v Speaker 1>climate change. And right now we don't have a national

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<v Speaker 1>standard that's a low carbon fuel standard. Some say, oh,

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<v Speaker 1>we can make the renewable fuel standard into a low

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<v Speaker 1>carbon fuel standard, or we could have a separate one.

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<v Speaker 1>But right now three states have low carbon fuel standards.

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<v Speaker 1>Two of them are active, one in Oregon, in California,

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<v Speaker 1>and Washington was the third to kind of move forward

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<v Speaker 1>their lower carbon fuel standard, which is set to take

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<v Speaker 1>effect next year. That's a really important point. I want

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<v Speaker 1>to sort of labor that a little bit that the

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<v Speaker 1>National renewable Fuel standard that requires adding ethanol, which we

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<v Speaker 1>should say is made from corn essentially to gas, was

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<v Speaker 1>not made for environmental reasons necessarily. It was. It was

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<v Speaker 1>created to reduce the demand on fossil fuels as a

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<v Speaker 1>way to like stretch, you know, fossil fuels, and this

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<v Speaker 1>was at a time when the price of fossil fuels

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<v Speaker 1>actually as as it is now, was very very high.

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<v Speaker 1>It sounds like that's not the that's not the point

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<v Speaker 1>of what these states are doing. The low carbon standard.

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<v Speaker 1>This actually has environmental goals here, right, So the renewable

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<v Speaker 1>fuel standard had an environmental component, but I think it

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<v Speaker 1>was just the ethanol requirement or the bio fuel requirement.

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<v Speaker 1>But actually a low carbon fuel standard doesn't limit fuel

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<v Speaker 1>options to ethanol. You know, it can be any type

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<v Speaker 1>of fuel. If you can make a fuel with even

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<v Speaker 1>another fossil fuel, so long as it meets this lower

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<v Speaker 1>carbon output that achieves you know, what they want. So

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<v Speaker 1>let's get to really the meat of your story here,

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<v Speaker 1>which is that, as you mentioned, we have three states

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<v Speaker 1>all on the Pacific coast, California, Oregon, and now Washington

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<v Speaker 1>who have enacted these types of state level fuel standards.

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<v Speaker 1>But there are also a lot of other states, specifically

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<v Speaker 1>states that are controlled by Democrats, that try to do

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<v Speaker 1>this as well and failed. What's going on here, wire?

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<v Speaker 1>You know, for every state that enacts this, wire, so

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<v Speaker 1>many more trying and failing. Yeah, that's a that's a

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<v Speaker 1>great question. So Washington had some trouble enacting their own

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<v Speaker 1>low carbon field standard. They were successful, but initially they

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<v Speaker 1>wanted to link it to a gas tax. And I'd

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<v Speaker 1>spoke to one expert and he told me that, you know,

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<v Speaker 1>there's kind of three broad reasons why lowcrmon field standards

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<v Speaker 1>kind of face these obstacles. The first one is that

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<v Speaker 1>lawmakers and opponents are concerned that, you know, a low

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<v Speaker 1>carbon field standard is going to add to gas prices.

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<v Speaker 1>That's a fear that proponents of a low carmon Fiel

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<v Speaker 1>standards say, you know, that's not really going to happen.

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<v Speaker 1>But that's I mean, that has a lot of traction

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<v Speaker 1>these days, you know, where like the you know, you

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<v Speaker 1>see headlines about the price of gas like every day practically.

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<v Speaker 1>That's definitely right. So there is that kind of perception

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<v Speaker 1>problem in actuality. The studies that I found the Oregon

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<v Speaker 1>Environmental Department, I think they had looked at their low

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<v Speaker 1>carbon field standard. They found it added sent per gallon

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<v Speaker 1>two gas. Not that much. Yeah, And then there was

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<v Speaker 1>another studied and they found that in California their low

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<v Speaker 1>carbon fuel standard added twenty two cents per gallon, so

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<v Speaker 1>it's a little more yeah. Yeah, So you know, take

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<v Speaker 1>those studies how you will. But you know, the advocates

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<v Speaker 1>in Washington had said, you know, this isn't going to

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<v Speaker 1>be a problem. It's really the global actions that affect

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<v Speaker 1>gas prices. Right. The second reason that these low carbon

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<v Speaker 1>field standards have kind of not gained traction in these

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<v Speaker 1>other states is because there isn't really a lot of

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<v Speaker 1>profit to be made from them. So in Washington, for example,

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<v Speaker 1>there they passed a cap and trade program last year

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<v Speaker 1>that's generating a lot of revenue, some of which is

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<v Speaker 1>actually going to funding this low carbon fuel standard. But

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<v Speaker 1>the low carbon fuel standard it self, it's self sustaining,

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<v Speaker 1>but it doesn't give you any profit to do something

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<v Speaker 1>else with. So it's a little part of a song.

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<v Speaker 1>It's not generating revenue for someone. No one's no one's

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<v Speaker 1>kind of getting rich off of this, right. And the

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<v Speaker 1>third problem is that environmentalists are actually sometimes in position

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<v Speaker 1>to low carbon field standards themselves. Yeah, and I want

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<v Speaker 1>to get even more deep into that because that was

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<v Speaker 1>something that I thought was so interesting in your stories,

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<v Speaker 1>that it's not that you have in these blue states.

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<v Speaker 1>You know, Republicans blocking these these new standards. Although you

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<v Speaker 1>know Republicans are opposed, you also have environmentalists who were

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<v Speaker 1>not really into it either, and that combination is what's

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<v Speaker 1>stopping them from from becoming law. Explain the argument there.

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<v Speaker 1>Why are environmentalists opposed to this? I mean, I face value,

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<v Speaker 1>you'd hear lower carbon fuel and you'd think that's a

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<v Speaker 1>no brainer for an environmentalist. No, that's exactly what I thought.

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<v Speaker 1>You know when I first reported on this is you know,

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<v Speaker 1>a low carbon fiel standards sounds like an environmental solution.

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<v Speaker 1>But I spoke with and some environmentalists, some environmental advocates,

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<v Speaker 1>and they said that a low carbon field standard is

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<v Speaker 1>actually kind of a policy of the nineties where you know,

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<v Speaker 1>it will lower carbon emissions over time, but the climate

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<v Speaker 1>goals that we need to meet now, they say, are

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<v Speaker 1>you know, a lot bigger, and we need to do

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<v Speaker 1>something like move to zero emission vehicles. And what a

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<v Speaker 1>low carbon fuel standard actually does is it provides fossil fuels,

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<v Speaker 1>you know, with prolonged use. You know, we're still going

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<v Speaker 1>to use gasoline and diesel, just maybe with lower carbon outputs.

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<v Speaker 1>And so they're saying, we want a bigger jumps. That's

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<v Speaker 1>so fascinating. And you know, I we see this happening

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<v Speaker 1>a lot where you have environmental activists and specifically climate

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<v Speaker 1>activists kind of debating about do we pursue this policy

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<v Speaker 1>that lowers the carbon footprint of fossil fuels or do

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<v Speaker 1>we try to pursue in eliminating fossil fuels altogether. And

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<v Speaker 1>it's I don't think there's a good answer, I mean,

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<v Speaker 1>and this is just another example of that where you

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<v Speaker 1>could argue that they're letting the perfect be the enemy

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<v Speaker 1>of the good. But on the other hand, you can

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<v Speaker 1>kind of understand why they would. You know, a climate

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<v Speaker 1>activist would want to eliminate fossil fuels full stop as

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<v Speaker 1>soon as possible. Yeah, I would say this is a

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<v Speaker 1>really interesting issue because sometimes it can fall on partisan

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<v Speaker 1>lines where you can have Republicans, for example in New Mexico,

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<v Speaker 1>and complete opposition, but then also Democrats. Some Democrats who

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<v Speaker 1>might be skeptical of this market based approach might also

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<v Speaker 1>oppose this, and so for that reason, you know, some

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<v Speaker 1>environmentalists do want a low carbon fuel standard, and some

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<v Speaker 1>fuel groups actually want it too, because they can sustain

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<v Speaker 1>their business with lower carbon fuels that are still at

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<v Speaker 1>the end of the day, gasoline and diesel fuels. But

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<v Speaker 1>at the same time you also have environmentalists saying, you know,

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<v Speaker 1>this isn't enough, we want more, and you have environmentalists

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<v Speaker 1>and Minnesota, for example, there was a group of twenty

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<v Speaker 1>two who wrote a letter saying that a low carbon

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<v Speaker 1>fuel standard would impact the immediate environment by encouraging more

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<v Speaker 1>agricultural production on you know, natural ecosystems. And so that's

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<v Speaker 1>another issue that you know, this thing brings about, and

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<v Speaker 1>that's to clarify, hear, more agricultural production, meaning growing more

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<v Speaker 1>corn to make more ethanol. That's something that I think

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<v Speaker 1>a lot of environmental activists have talked about that the

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<v Speaker 1>renewable fuel standard creates other environmental impacts if you you know, uh,

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<v Speaker 1>you know, take out grassland or forests and grow corn

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<v Speaker 1>for it exactly. Yeah. Uh. And the other thing we

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<v Speaker 1>should note is that, I mean, these are this is

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<v Speaker 1>not a situation where these gas uh, these fuel standards

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<v Speaker 1>are going down by a lot. This is really close.

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<v Speaker 1>Specifically in New Mexico. I think your story wrote that

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<v Speaker 1>the fuel standard lost by one vote in the House.

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<v Speaker 1>That's literally one vote, right, So it was actually it

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<v Speaker 1>was a tie vote or you had thirty three to

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<v Speaker 1>thirty three and a House of seventy with four abstentions

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<v Speaker 1>or at least non presence, and you had Democrats outnumbering

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<v Speaker 1>Republicans by nearly two to one in that chamber. It's

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<v Speaker 1>a blue state, right, So, and the governor was pushing

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<v Speaker 1>for this. Governor Michelle Juhan Grisham was really you know,

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<v Speaker 1>advocating for this as a central part of you know,

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<v Speaker 1>their climate policy. And this was the second time they

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<v Speaker 1>were going at it, and so, you know, this has

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<v Speaker 1>been something that just you know, critics and you know,

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<v Speaker 1>some experts have said, you know, it's kind of a

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<v Speaker 1>flawed policy because it doesn't produce enough rewards and people

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<v Speaker 1>just don't think it's enough. Okay, finally, where are we

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<v Speaker 1>headed in the future. Do you see this as being

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<v Speaker 1>kind of dead? I mean, you know, yes, we have

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<v Speaker 1>three states, including a new one, you know, adopting this,

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<v Speaker 1>but it sounds like we also have several other states

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<v Speaker 1>you know, running into a wall here trying to get

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<v Speaker 1>this past. Do you think this idea has kind of

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<v Speaker 1>you know, it's not going to be expanding or do

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<v Speaker 1>you think that that the proponents of this idea will

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<v Speaker 1>try different tactics and keep trying. I think there's going

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<v Speaker 1>to be continued action, and I think there's definitely arguments

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<v Speaker 1>on both side where you could say, oh, look at

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<v Speaker 1>what happened in Washington. They tried, they tried again, they

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<v Speaker 1>got a low carbon fuel standard that's going to be

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<v Speaker 1>something that over the next twenty years or so, it's

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<v Speaker 1>going to lower transportation fuel emissions from auto vehicles by

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<v Speaker 1>twenty percent. But on the other hand, you could say, well,

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<v Speaker 1>look at New Mexico and look at New York. They

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<v Speaker 1>had their state budget and they didn't incorporate a low

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<v Speaker 1>carbon field standard that was you know, pushed by lawmakers

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<v Speaker 1>and environmental advocates and other groups, but also opposed by

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<v Speaker 1>lawmakers and environmental advocates and other groups where they say

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<v Speaker 1>strange bedfellows exactly. Yeah. And in Minnesota, you know, they

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<v Speaker 1>had a Climate and Energy Omnibus bill and they're still

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<v Speaker 1>studying it, and so I think, you know, there's potential

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<v Speaker 1>for that to move forward. But you know, if I

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<v Speaker 1>had to bat on it, I would say, you know,

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<v Speaker 1>it's more likely than not to fail. So to sum

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<v Speaker 1>it up, not dead, but probably on life support, right, Yeah,

0:12:36.920 --> 0:12:40.720
<v Speaker 1>you know it really it really depends on the state

0:12:40.760 --> 0:12:43.360
<v Speaker 1>the situation and you know how people fall on it.

0:12:44.160 --> 0:12:46.640
<v Speaker 1>All right, Well that was Zach Bright, environmental reporter with

0:12:46.679 --> 0:12:49.160
<v Speaker 1>Bloomberg Law. Thank you so much for joining us. Yeah,

0:12:49.160 --> 0:12:53.400
<v Speaker 1>thank you, David. And that's it for today's episode of

0:12:53.480 --> 0:12:55.839
<v Speaker 1>Parts per Billion. If you want more environmental news, check

0:12:55.880 --> 0:12:57.800
<v Speaker 1>us out on Twitter. We use a pretty easy to

0:12:57.840 --> 0:13:01.640
<v Speaker 1>remember handle. It's at environment. Is that at environment? I'm

0:13:01.640 --> 0:13:05.440
<v Speaker 1>a David B. Schultz. That's b as in runs batted in.

0:13:05.960 --> 0:13:08.760
<v Speaker 1>Hopefully the Washington Nationals will find a few more of those.

0:13:09.120 --> 0:13:11.320
<v Speaker 1>Today's episode of Parts for Billion was produced by myself,

0:13:11.400 --> 0:13:13.880
<v Speaker 1>David Schultz. Partsfer Billion was created by Jessica Coombs and

0:13:13.920 --> 0:13:17.160
<v Speaker 1>Rachel Dagle and is edited by Zach Sherwood and Chuck McCutcheon.

0:13:17.360 --> 0:13:20.760
<v Speaker 1>Our executive producer is Josh Block. Thanks everyone for listening.

0:13:21.720 --> 0:13:23.800
<v Speaker 1>You don't need to be a judge to be interested

0:13:23.840 --> 0:13:27.360
<v Speaker 1>in our nation's laws and legal institutions, just like you

0:13:27.400 --> 0:13:29.320
<v Speaker 1>don't need to have a law degree to be curious

0:13:29.320 --> 0:13:33.120
<v Speaker 1>about the inner workings of courts, law firms, and law schools.

0:13:33.120 --> 0:13:36.000
<v Speaker 1>That's where we come in. My name's Adam Allington and

0:13:36.040 --> 0:13:38.760
<v Speaker 1>I'm the host of uncommon Law, a podcast from the

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<v Speaker 1>Bloomberg Industry group. Uncommon Law is where public policy, storytelling,

0:13:43.559 --> 0:13:47.520
<v Speaker 1>and the law are combined. We explore big topics ranging

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<v Speaker 1>from tech policy to free speech to race and gender diversity.

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<v Speaker 1>So please give us a listen. You can subscribe and

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<v Speaker 1>download today. Just search for uncommon Law wherever you get

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<v Speaker 1>your podcasts. Thanks so much,