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Clean Fuels Program Overview

The illustration below is a quick way to view the basic structure of the Clean Fuels Program. The left axis of the graph shows the required reductions in average carbon intensity or level of carbon emissions when combusted. The bottom axis shows years starting from the beginning of the program in 2016. 

average carbon intensity values
Please see a list of transportation fuels and how they might participate in the program below.

Mandatory Regulated Parties - Importers of:
  • Gasoline
  • Diesel
  • Ethanol
  • Biodiesel
  • Renewable diesel
Voluntary Registered Parties:
  • For CNG, LNG and LPG: owner of dispenser
  • For renewable natural gas, propane & jet fuel: producer or importer
  • For electricity:
    • Fixed light rail, street car, aerial tram, buses: transit agency
    • For forklifts: forklift owner
    • For residential EV charging: electric utility
    • For non-residential EV charging: charger owner or the operator if the owner does not register
    • For transportation refrigeration units: owner of the refrigeration unit
    • For cargo handling equipment: owner of the charging equipment
    • For ocean-going vessels: owner of the equipment that provides electrical power from the shore
    • For ground support equipment: owner of the charging equipment
  • For hydrogen: owner of fuel
  • For alternative jet fuel: producer or importer

Clean Fuel Standards

The clean fuel standards are the annual average carbon intensity with which a regulated party must comply. There is a standard for gasoline and gasoline substitutes or alternatives, one for diesel and diesel substitutes or alternatives, and one for alternative jet fuel. The baseline year for the program is 2015 and the standard for that year represents 10 percent ethanol blended with gasoline and 5 percent biodiesel blended with diesel. The current rule requires a 10 percent reduction in average carbon intensity from 2015 levels by 2025, followed by a 20 percent reduction by 2030 and 37 percent by 2035.


DEQ has identified the carbon intensity, or level of carbon emissions, for each type of available fuel, with diesel and gasoline having the highest carbon intensity. Each year, DEQ sets the level of carbon intensity of transportation fuels used in Oregon. DEQ requires fuel providers to show that the volume and type of fuel they supply for use in Oregon meets the carbon intensity level, or standard, for that year. DEQ gradually lowers the amount of carbon intensity in fuel allowed each year to meet the annual reduction goal. 

Businesses that create fuels that are cleaner than the annual limit generate credits, while higher carbon intensity fuels create deficits. Credits and deficits are measured in metric tons of greenhouse gas emissions. Credits can be sold to offset deficits, which in turn produces revenue to pay for projects that lower greenhouse gas emissions. Examples of such projects are installations of electric charging stations and dairy manure digesters that inject methane into natural gas pipelines.​

The Clean Fuels Program encourages reductions in carbon intensity by allowing a fuel provider to sell credits they have earned by going beyond the reduction goals for that year. Those excess credits can be saved to offset future deficits the entity may incur or for future sale as demand increases.

Examples of clean fuel providers include businesses that own electric vehicle charging stations, compressors for natural gas, or dispensers for propane. Utilities that supply electricity for electric vehicles, or manufacturers of ethanol and biodiesel, also earn credits that they can sell to pay for charging stations or to lower the cost of producing alternative fuels.​​

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Importers of gasoline, diesel, ethanol, biodiesel, and renewable diesel and in-state producers of any transportation fuel are required to participate. In addition, providers of natural gas (owner of the dispenser), propane (owner of the dispenser), electricity (owner of the charger or the electric utility), and hydrogen (owner of the fuel) can choose to participate if they wish to generate credits.​​

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Collectively, regulated parties and credit generating entities that opt into the program are referred to as Registered Parties and must:

  • Register with DEQ before producing fuel in Oregon, importing fuel into Oregon, dispensing certain fuels into motor vehicles, or generating or transacting credits for fuels supplied in Oregon​;
  • Keep records for each transaction of transportation fuel imported, sold or supplied for use in Oregon; and
  • Submit quarterly and annual reports using the Oregon Fuels Reporting System. ​

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Regulated parties must comply with the Clean Fuel Standards by balancing their credits and deficits for each calendar year by the annual report deadline. Regulated parties can retire credits they generated themselves or purchase credits from other entities. A Credit Clearance Market will provide an additional opportunity for regulated parties to comply with the clean fuel standards if they cannot generate or purchase sufficient credits during by the annual report deadline. ​

Contact

For more information on this program, email Oregon Clean Fuels.