Nebraska ethanol producers are waiting—and hoping—that California’s Air Resources Board (CARB) will see fit to modify the controversial Low Carbon Fuel Standard it passed in 2009.  

The new standard, which is scheduled to take effect in 2011, could ban the use of corn-based ethanol in California.  Considering a good share of the ethanol produced in Nebraska is shipped to California, there is reason for concern, says Nebraska Ethanol Board administrator Todd Sneller. 

“California, as a state, is a very, very large gasoline market.  Nearly a third of all the gasoline consumed in the U.S. is consumed in California,” Sneller says, “and so it becomes a very important destination market and we want to make sure that we continue to have an open marketplace that allows the Nebraska producers to compete in a fair way.” 

When constructing their low carbon fuel standard, CARB put heavy emphasis on indirect land use change calculations.  Sneller says it’s is a confusing and complicated rule that no one—including the Californians—understand very well. “What’s pretty clear is that they’ve set a bar that’s so high in terms of environmental performance and greenhouse gas reductions, that there may not be many gallons of biofuel that can meet that standard.”

And Sneller says CARB may have painted itself into a corner. 

“It would appear, at this time, that about the only fuel that might comply would be Brazilian sugar cane-derived ethanol—and that’s in very short supply on a worldwide basis right now,” says Sneller, “and so one’s got to really ask the question about whether it makes good sense to adopt a policy that’s going to encourage more imports and raise prices for consumers.” 

Shortly after the new fuel standard was approved, CARB formed a so-called “expert work group” to review the formulas that were used.  Ethanol industry officials are cautiously optimistic that those experts will convince CARB to modify the law so that corn-based ethanol is not penalized so heavily.

AUDIO: Todd Sneller (2 min MP3)