Double-take on Low Carbon Fuels Standards – Oil Companies Can Prosper

Washington State is in the home stretch on its debate over low carbon fuel standards (LCFS), resting on HB 1091 to allow the Evergreen State to join its regional neighbors in having legislation to provide incentives for cleaner fuels. Despite the success of such programs in California and Oregon, the same old tropes are being plied in an effort to once again stall the forward momentum of Washington’s transition to a clean fuel economy. However, the success elsewhere has made champions out of the unexpected – voices from the oil industry.

Nathan Crum is the president and CEO of Valley Pacific Petroleum, based in Stockton, California which has operated as a distributer and marketer of fuels and lubricants for more than 70 years and a CALSTART member for more than three years. Watching the company’s opportunities closely as California, the nation and the world transition to cleaner fuels, Nathan recognizes that a low carbon fuels standard is the kind of incentive needed to smoothly transition his operations and to seize growth opportunities for the future.

California’s LCFS was implemented in 2011 and has encouraged Valley Pacific Petroleum to diversify its business. Instead of being solely reliant on one global commodity – oil – LCFS allows the company to profitably sell other fuels including renewable and biodiesel. These are fuels that play a major role in decreasing the carbon intensity of the big rigs that are so crucial to our economy.

Crum knows that the industry is dependent on the end customer, the trucker, because decisions are made at the pump. “The trucking companies were reluctant at first, but now prefer these non-petroleum fuels due, in part, to the cost savings over petroleum diesel. These cost savings wouldn’t be possible without the credits the LCFS provides,” said Crum in a support letter for the Washington legislation. “Renewable diesel and biodiesel are drop-in fuels. No modifications to trucks are needed. Once these incentives are in place, Washington could see immediate adoption of these products, and immediate reductions in greenhouse gas emissions.”

While Valley Pacific Petroleum does not operate in Washington, it is proof of how family-owned, locally operated businesses can benefit from a low carbon fuel standard. Because LCFS supports domestically produced fuels, the growth and sustainment of jobs and is good for the environment, it is a policy that brings many different stakeholders together. Nathan Crum, oil industry executive, is on board and ready for the future. He has his eye on Washington and hopes that it joins him.