Victoria, British Columbia – The British Columbia government has enacted a new Renewable and Low Carbon Fuel Requirements regulation, which amends a 2008 regulation to include new requirements to reduce the carbon intensity of transportation fuels by 10 per cent by 2020.

The December 2008 Renewable Fuel Requirements Regulation, amended by the new regulation, established a five per cent provincial average renewable fuel requirement for 2010. The regulations are made under the Greenhouse Gas Reduction Act, which was passed in May 2008.

The new low-carbon fuel requirement is a market-based approach to achieving emission reductions. This requirement uses life-cycle analysis to determine the overall carbon intensity of fuels used for transportation, and includes all factors associated with the production and consumption of each fuel. This includes exploration and production of fossil fuels, production of crops for biofuels, and the refining, transport and end use of the fuel.

The requirement provides industry with flexibility in choosing how best to comply. Compliance options include changing the fuel mix, improving refining efficiency, or improving agricultural practices for growing biofuel crops. The low-carbon fuel requirement will be phased in, starting with reporting only in 2010, a reduction of 0.25 per cent in 2011, and increasing annual carbon intensity improvements to reach a total reduction of ten per cent in 2020.

The five per cent renewable fuel requirement for diesel, set for January 1, 2010, is also amended. It will now be phased in with a three per cent target for 2010, four per cent for 2011, and five per cent by 2012. The approach will provide industry with time to put the necessary Canadian infrastructure into place, and address technical issues regarding the cold-weather properties of biodiesel, and engine manufacturer warranties that may limit the use of biodiesel.

The five per cent renewable requirement for gasoline in 2010 remains unchanged.

The renewable fuel requirement is expected to have an effect in the range of one cent per litre on average. As renewable fuel supplies increase, the cost is expected to decrease.

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