A Clean Fuels Policy for
the Midwest
January 7, 2020
A WHITE PAPER FROM THE MIDWESTERN
CLEAN FUELS POLICY INITIATIVE
A Clean Fuels Policy for the Midwest
ii
GREAT PLAINS INSTITUTE
About the Great Plains Institute
A nonpartisan, nonprofit organization, the Great Plains Institute (GPI) is transforming the
energy system to benefit the economy and environment. Working across the US, we
combine a unique consensus-building approach, expert knowledge, research and
analysis, and local action to find and implement lasting solutions. Our work strengthens
communities and provides greater economic opportunity through creation of higher
paying jobs, expansion of the nation’s industrial base, and greater domestic energy
independence while eliminating carbon emissions.
Learn more: www.betterenergy.org
Acknowledgements
We are grateful to the Bernard and Anne Spitzer Charitable Trust, the MacArthur
Foundation, and the McKnight Foundation for financially supporting the collaborative
stakeholder discussion that informed this white paper, and to the McKnight Foundation,
the American Coalition for Ethanol, and Union of Concerned Scientists for supporting the
modeling work that informed the stakeholder engagement.
We are grateful to all the participants in the Midwestern Clean Fuels Policy Initiative for
devoting their time and expertise to finding a portfolio approach for promoting clean fuels
in the Midwest, the Steering Committee for overseeing the process, and the McKnight
Foundation for hosting many of the stakeholder meetings. ICF provided modeling and
analysis that informed the discussions of the Midwestern Clean Fuels Policy Initiative.
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Contents
About the Great Plains Institute .................................................................................... ii
Acknowledgements ........................................................................................................ ii
Midwestern Clean Fuels Policy Initiative ...................................................................... 1
List of Organizations .................................................................................................. 1
Background ..................................................................................................................... 3
Clean Fuels Policy Overview ..................................................................................... 3
A Regional Approach ................................................................................................. 4
A Vision for a Clean Fuels Policy for the Midwest ....................................................... 5
Principles for a Midwestern Clean Fuels Policy .......................................................... 5
Midwestern Clean Fuels Policy Considerations .......................................................... 6
Areas for future work .................................................................................................... 11
Conclusion .................................................................................................................... 12
Technical Glossary ................................................................................................... 13
Appendix: Existing State Policies and Regulations that Provide a Foundation for
Clean Fuels Policy Development in the Midwest ................................................... 16
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Midwestern Clean Fuels Policy Initiative
The Midwestern Clean Fuels Initiative, facilitated by the Great Plains Institute, is a broad
coalition of fuels producers and marketers, nonprofit and research organizations,
scientists and engineers, and agriculture and industry stakeholders. The coalition works
to create economic benefits for the region through policy, research, and education on the
production and use of cleaner fuels. In addition to economic benefits, the use of cleaner
fuels will reduce greenhouse gas emissions, increase energy security, improve water,
air, and soil quality, and lead to improvements in public health.
LIST OF ORGANIZATIONS
This Initiative is exploring a clean fuels policy, at the state or regional level, as a market-
driven approach to achieving our economic, energy security, climate, environmental, and
public health goals. This white paper presents policy design considerations that are
intended to inform further discussion of new and existing clean fuels policies and how
they could be tailored to benefit the Midwest. These considerations should not be viewed
as an endorsement of any specific piece of legislation. The Midwestern Clean Fuels
Initiative stakeholders are committed to continuing to work together to address
unanswered questions and to engage additional groups that are not yet at the table.
The following organizations participated in the Midwestern Clean Fuel Policy Initiative
stakeholder discussion that informed this white paper:
• Alternative Fuels Council
• American Coalition for Ethanol
• Center for Energy and Environment
• ChargePoint
• Christianson PLLP
• Coalition for Renewable Natural Gas
• Conservation Districts of Iowa
• Conservation Minnesota
• Environmental Law and Policy Center
• EcoEngineers
• Fresh Energy
• General Motors
• Governors’ Biofuel Coalition
• Guardian Energy
• Highwater Ethanol, LLC
• Iowa Environmental Council
• Iowa Soybean Association
• Iowa State University Bioeconomy Institute
• Kansas Corn
• Low Carbon Fuel Coalition
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• Minnesota Bio-Fuels Association
• National Biodiesel Board
• National Corn Growers Association
• Partnership on Waste & Energy (Hennepin, Ramsey & Washington Counties)
• Renewable Fuels Association
• Renewable Products Marketing Group
• South Dakota Corn
• Sustainable Farming Corporation
• Union of Concerned Scientists
• Urban Air Initiative
• Xcel Energy
• ZEF Energy
The following state government entities were observers in the process:
• Minnesota Department of Agriculture
• Minnesota Department of Commerce
• Minnesota Department of Employment and Economic Development
• Minnesota Department of Transportation
• Minnesota Pollution Control Agency
• Nebraska Ethanol Board
The following individuals served as technical advisors to the process:
• Doug Karlen, retired, USDA Agricultural Research Service
• Emily Heaton, Iowa State University
• Lisa Schulte-Moore, Iowa State University
• Shaina Westhoff, South Dakota State University
• David Clay, South Dakota State University
• Jane M F Johnson, USDA Agricultural Research Service
• Nicholas Jordan, University of Minnesota
• Michael Wang, Argonne National Laboratory
• Hoyoung Kwon, Argonne National Laboratory
The following individuals served on the steering committee:
• Paul Austin, Conservation Minnesota
• Mike Bull, Center for Energy and Environment
• Geoff Cooper, Renewable Fuels Association
• Brian Jennings, American Coalition for Ethanol
• Jonathon Lehman, Cultivating Conservation
• Nicholas Martin, Xcel Energy
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Background
CLEAN FUELS POLICY OVERVIEW
A clean fuels policy, also known in some jurisdictions as a low carbon fuel standard or
clean fuel standard, is a performance-based incentive program that supports the
commercial deployment of fuels with lower lifecycle carbon intensity. A clean fuels policy
evaluates all fuels used in the relevant jurisdiction based on lifecycle carbon accounting
and assigns each fuel production method a unique carbon intensity (CI) score that is the
complete well-to-wheels carbon equivalent emissions normalized for the energy content
of the fuel. For example, a CI score for gasoline or diesel includes emissions from crude
oil extraction, transportation, refining, and combustion in a vehicle. A CI score for a
biofuel includes emissions from farming, biofuel production, and combustion in a vehicle.
A CI score for electricity includes emissions from production of electricity (including all
relevant upstream emissions), sources of electricity, and the efficiency of electric
vehicles (EVs).
A well-designed clean fuels policy has numerous positive attributes for the economy and
environment:
• Designed to be technology-neutral.
• Compensates any clean fuel or low carbon fuel
1
provider that can achieve a
lower CI than the policy requires.
• Supports a portfolio of clean fuels and compensates fuel producers based
on
their actual carbon performance without discriminating against or
disproportionately favoring any fuel.
• Encourages a competitive marketplace in clean fuels and offers incentives to
support access to the market.
• Supports development of a variety of clean fuel types, including but not limited t
o
biofuels, electricity, and hydrogen.
A clean fuels policy differs from other policies impacting fuels such as the federal
Renewable Fuel Standard, which is based on volumes of fuel rather than carbon
reductions, and vehicle-based policies like an EV tax credit that does not place
requirements on the electricity used in the vehicle.
1
Clean fuel and low carbon fuel have the same meaning, as defined in the glossary.
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A well-designed clean fuels policy has many benefits:
• Increased investment in a portfolio of cleaner fuels and subsequent economic
benefits.
• Reductions in air pollution and subsequent health benefits.
• Increased energy independence by relying less on imported resources and mor
e
on domestic resources.
• Supports market access for clean fuels that are often lower cost t
han
conventional fuels and currently face barriers to entry in the marketplace, which
benefits consumers.
• Reduced greenhouse gas (GHG) emissions in the two largest emitting sectors of
transportation and electricity as well as in the agricultural sector.
Every state and region is unique in terms of its history, resources, and policy framework
and will necessarily take a different approach in supporting clean fuels development.
There are several examples of existing or emerging clean fuels policies in the US and
other nations:
• The California LCFS regulation was proposed in 2007, approved in 2009, and
went into effect in 2011
.
• British Columbia passed an LCFS in 2008.
• The Oregon Clean Fuels Program rulemaking was authorized in 2009 and was
fully implemented in 2016
.
• Brazil, the European Union, and the United Kingdom have similar policies.
• Clean fuels policies are in development or under consideration in Canada,
Colorado, New York, and Washington.
This white paper considers the impacts of a potential clean fuels policy in the Midwest.
Although informed by efforts in other states and nations, this is a truly Midwestern
approach.
A REGIONAL APPROACH
The Midwest already has a strong foundation for clean fuels development and will have
a head start on other regions in reducing the CI of transportation fuels. The region is
home to the largest concentration of biofuel producers in the country and has been more
successful than other regions in promoting higher biofuel blends. Additionally,
Midwestern states have already taken policy and administrative actions to support
various clean fuels. The Midwestern Clean Fuels Policy Initiative will build on the existing
state policy framework. The appendix lists existing policies and regulations in
Midwestern states that provide a foundation for a Midwestern clean fuels policy and help
achieve the vision of this initiative.
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A Vision for a Clean Fuels Policy for the Midwest
A clean fuels policy, whether adopted at the state level in the Midwest, in other states, or
at the regional level, should seek to achieve the following outcomes for the region:
• Contribute to meeting and exceeding existing goals and policies at the state
level, including policies to replace petroleum, increase biofuel use, support EV
goals, and more fully actualize transportation greenhouse gas reduction goal
s
and policies.
• Support a portfolio of clean fuels, including biofuels, low and zero-car
bon
electricity for transportation, and other clean fuel options.
• Make the economic prize bigger by expanding the clean fuels market and avoi
d
pitting different clean fuels against each other.
• Create a backstop if federal policy supporting clean fuels is undermined.
• Create broad rural and urban economic development, benefits for communities,
consumers, and agriculture, and increased energy security from increased
reliance on clean fuels produced in the Midwest.
• Achieve additional GHG reductions through increased renewable content in
transportation fuels over time.
• Support existing farmer-led efforts to adopt agricultural practices that benefit soil
health and water quality while contributing to GHG reductions.
• Contribute to electricity sector decarbonization, increased use of renewable
electricity, and benefits for electricity customers as managed EV chargi
ng
enables efficient renewable electricity integration and puts downward pressure
on electric rates.
• Improve air quality and public health.
Principles for a Midwestern Clean Fuels Policy
The Midwestern Clean Fuels Policy Initiative aims to create a market specifically for
regional clean fuel producers that simultaneously delivers environmental and economic
benefits. Over an approximately 20-month long process, the Initiative led stakeholder
discussion to consider potential costs and benefits of a Midwestern clean fuels policy
being adopted at the state level and coordinated regionally. When developing new
policies, the following principles should be considered:
• Design a market-based approach while remaining fuel and technology neutral
,
relying on a portfolio of clean fuels including biodiesel, ethanol, renewable natural
gas, electricity as a transportation fuel, hydrogen, and other renewable and low-
carbon fuels. Design the policy based on the lifecycle assessment (LCA) of fuels.
Lifecycle assessments should be consistent for all fuel types, science-
and
engineering-based, up to date, incorporate upstream emissions, and reflect
differences in vehicle fuel efficiency with different drive trains. The latest Argonne
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GREET model should be used as a basis for conducting lifecycle assessments.
The Argonne GREET model uses a rigorous process based on the best available
science. It is maintained by Argonne National Laboratory, a United States
Department of Energy laboratory that has the capacity to keep the model
updated.
• Consider regional factors in the Midwest, including the impact of renewable
electricity development on the electric grid, current production practices at biofuel
facilities, adoption of farming practices that impact soil organic carbon
and
nitrous oxide emissions, and current and aspirational biofuel blending levels.
• Build on existing state policies rather than replacing those policies. Great
progress has been made in the region to develop a mature ethanol and biodiesel
industry and a small but growing EV and renewable natural gas sector. Any new
policies should build on rather than replace existing state and federal fuel
and
GHG policies, such as state biofuel blending requirements and incentives, state
EV goals, state GHG goals, and the federal Renewable Fuel Standard.
• Reinforce and complement existing efforts by the agricultural sector to increase
the adoption of practices that improve soil health and water quality and have th
e
potential to lower the carbon intensity of biofuel production by storing more soil
organic carbon and reducing nitrous oxide emissions related to farming. Support
methane reduction efforts by supporting increased use of renewable natural gas.
• Recognize emissions reductions at the farm level that contribute to the reduced
carbon intensity of fuels.
• While recognizing state autonomy in policy making, states should collaborate and
seek to create a uniform regional approach where possible. If possible, states
should seek to achieve interoperability and explore credit fungibility with other
clean fuels programs, both within and outside the region.
Midwestern Clean Fuels Policy Considerations
The Midwestern Clean Fuels Policy Initiative offers the opportunity for economic
development in the Midwest by using regionally-produced raw materials to increase the
production and consumption of clean fuels in the region. Features of a Midwestern
approach to clean fuels policy that offers competitive advantages are discussed below.
• Achievable reductions. This white paper was informed by modeling for
achieving average CI reductions for all transportation fuels of either 10 percent
,
15 percent, or 20 percent by 2030 and finds that all those scenarios are
achievable mostly with clean fuel production resources available in the region.
• Fair lifecycle assessment. Lifecycle assessment should be fair for all fuel types,
incorporating upstream emissions in a consistent manner and including
agricultural conservation practices and reduced emissions from transportation o
f
clean fuels transportation via biofuel and electrification. Argonne National
Laboratory’s GREET lifecycle model should be used for conducting lifecycle
assessments to assign CI values to fuels. The Argonne GREET model is
regularly updated to incorporate new science and data through a rigorous
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process. The Argonne team strives to be impartial in their assessments and keep
the model up to date, already sourcing some data and information from
Midwestern land grant universities. Lifecycle models must be continuously
updated, and the Argonne GREET team already has the infrastructure to do this.
• Program administration. We do not recommend a specific program
administrator; this will be determined by each individual state that chooses to
move forward with a clean fuels policy. However, any state that chooses to move
forward with a program will need to choose a program administrator.
• Point of regulation. A point of regulation should be selected that avoids placing
a burden on small fuel retailers and simplifies compliance as much as possible.
• Regional coordination. States that move forward with a clean fuels policy
should work together to achieve a coordinated approach in the Midwest and
beyond. A Midwestern clean fuels policy will be more efficient, drive higher
demand, create a larger market, and will make more efficient use of
administrative resources if it is implemented in multiple states simultaneously and
states follow a consistent approach.
• Benefits for clean fuel producers. The focus of a clean fuels policy is on
supporting development and use of clean fuels, and clean fuels producers (i.e.,
the producers of low carbon biofuels, electricity, and other fuels) should be the
credit-generating entities under the program in most cases.
• Renewability. States should consider a minimum renewability requirement (e.g.,
30 percent renewable) for clean fuels participating in the program.
• Administrative efficiency. Because of the importance of operating an
administratively lean program and ensuring collaboration with programs in other
regions of the country, Midwestern states should consider a surgical approach to
approving fuel pathways that starts with pathways approved in other states and
then makes changes to specific emissions factors where it is justified.
Calculating CI scores using Midwestern data and using the latest GREET model
will produce lower CI scores in Midwestern states. States should seek to adapt
existing pathways, look-up tables, simplified calculators, and other tools that are
used in other programs in the United States and Canada and update specific
emission factors, rather than completely recreating the pathway approval
process. States should consider collaborating to create a common approach to
establishing fuel pathways to reduce the administrative burden for fuel providers
and states and create a larger regional market.
• Consistent approach. Midwestern policies should take a consistent approach
across all clean fuel types (e.g., by allowing indirect accounting [described below]
for low-carbon electricity for all fuel types instead of allowing it only for electric
and hydrogen vehicles). States should consider allowing indirect accounting for
low-carbon energy use in fuel production facilities and upstream facilities (e.g.,
soybean crush plants).
• Indirect accounting. Indirect accounting (or book and claim) has unique
potential for incentivizing decarbonization of electricity and natural gas in the
Midwest due to abundant but distributed wind, solar, and biogas generation
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potential. Indirect accounting refers to a lifecycle accounting methodology for fuel
production that allows off-site generation of lower-carbon and/or renewable
energy and electricity to be counted as an input to fuel production despite not
being physically connected to the production facility.
o Indirect accounting for low-carbon electricity, biogas, and other low-
carbon intensity energy inputs should be allowed for all clean fuel
producers, building on existing protocols such as utility green tariffs.
Double counting of environmental benefits should be avoided, as well as
double-counting of environmental liabilities, unless otherwise acceptable
under a program under federal jurisdiction.
o Indirect accounting should demonstrate that the renewable or clean
energy input is only being used by the project claiming it and is not being
double-counted. The renewable or low-carbon attribute of the off-site
electricity, biogas, or other low-carbon intensity energy input should be
tracked, and retirement of the environmental credit should be
documented to ensure that the environmental attribute is not being
claimed for compliance with another policy or a voluntary procurement
program, unless otherwise allowed under a federal program.
o Indirect accounting for electricity could be based upon participation in a
utility-sponsored green power program or tariff and should include
retirement of a renewable energy credit on behalf of the producer.
o Indirect accounting for renewable natural gas should involve tracking and
retirement of a renewable natural gas credit.
o Full lifecycle emissions for indirect accounting should be calculated using
GREET and incorporate upstream emissions.
• Midwest-specific emissions factors. Midwestern policies should include
updated and regionally-specific emissions factors in the following areas:
o Calculation of induced land use change should use the most current
science and reflect actual historic land use changes.
o Electricity emissions factors should be calculated using GREET to
incorporate all emissions related to power production, transmission, and
use. The mechanism should motivate increased use of renewable
resources and give credit to use of renewable and low-carbon electricity
that is better than the state or regional average. The options are as
follows:
§ States should publish an average electric grid carbon intensity
based on the most accurate state or regional value. The state or
regional grid mix emissions factor should be available as a default
value if a utility-specific value is not available. State or regional
electricity emissions factors should be calculated within GREET to
reflect the fuel resource mix and upstream lifecycle emissions.
Default values should be updated to reflect the use of utility-
specific values by certain utilities.
§ Utilities should publish a utility-specific grid mix carbon intensity
and other necessary data to enable calculation of full lifecycle
emissions factors for electricity using GREET. The published grid
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mix should subtract renewable electricity or clean energy credits
that are used for voluntary green purchasing programs and
retired, in order to avoid double-counting of environmental
benefits. The utility-specific grid mix for the appropriate utility
should be an option for any fuel producer that uses electricity as
an energy input.
§ Clean fuel producers that use electricity as a process input should
be able to reduce their electricity emissions factor through
generation of on-site generation or using indirect accounting for
low-carbon electricity and double counting of electricity
environmental benefits should be avoided.
o Direct accounting for low-carbon electricity, biomass, solar thermal,
biogas, and other low carbon intensity energy inputs for on-site use
should be allowed for all fuel producers. Double counting of
environmental benefits should be avoided, unless otherwise acceptable
under a federal program.
o Transportation distances for feedstocks should be updated for all fuels to
reflect the transportation distance to the Midwestern state where the fuel
is being used.
o State or sub-state regional average emissions factors for farming
practices and soil carbon storage should be determined for use in biofuel
carbon accounting.
o Lifecycle accounting for all fuels should differentiate between co-products
that are the main product, byproduct, residue, or waste. Double counting
should be avoided.
o Lifecycle accounting for biofuels should reflect state biofuel blending
requirements that are already in effect, thus lowering the carbon intensity
of fuel used for transportation and farm equipment.
o States should include E85 plug-in hybrid electric vehicles (PHEVs) as a
balanced strategy for lowering fuel carbon intensity that benefits from
efficiencies and carbon intensity reductions from electricity and ethanol.
States should consider the efficiency benefits of higher blends in flexible
fuel vehicles and new engine technologies optimized for high octane fuel.
o States should account for the benefits of higher octane in mid- and high-
level ethanol blends in determining the energy efficiency ratio of vehicles
that use these blends.
o Biogenic carbon dioxide emissions for fugitive hydrocarbons should be
zero.
• Clean fuels policies and agricultural practices. Farming practices are a
significant part of the overall carbon intensity of biofuels, and there is great
potential to lower biofuel carbon intensity through the adoption of agricultural
practices that store soil carbon, reduce nitrous oxide emissions, or accomplish
both. In most cases, these practices further benefit soil health and water quality.
The region should leverage state clean fuels policies to support and complement
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existing efforts by agriculture and other stakeholders to support the adoption of
farming practices that store soil carbon, reduce emissions, and improve water
quality. We explore three major ways to accomplish this:
o States should ensure that
farming emissions factors for
Midwestern states are fair and
accurate and incorporate soil
organic carbon storage, recent
increases in the adoption of
various conservation practices
like no-till and cover crops that
impact soil carbon and nitrous
oxide emissions, the impact of
state policies like state nutrient
reduction strategies and rules,
and other factors. Midwestern
states should develop updated
average farming emissions
factors at the state and sub-state
levels as appropriate. States
should benefit from and build on
an ongoing collaborative effort
by Argonne National Laboratory,
universities, United States
Department of Agriculture
Agricultural Research Service
and Natural Resources
Conservation Service and other
agriculture researchers, and
stakeholders to develop
approaches that would allow fuel
producers to demonstrate that
their feedstock suppliers are
achieving an emissions factor
lower than the state or sub-state
averages. A protocol to allow this
is not available today, but efforts
should be made to develop it.
The protocol should allow for
site-specific farm practice
scoring, traceability, and
verification. States could also look to the experience under the European
Union Renewable Energy Directive, including the International
Sustainability Carbon Certification program, in auditing farm practices and
learn from that system as a Midwestern approach is developed.
Midwestern groups should seek acceptance of the farm practices
Models for Agricultural
Producers to Benefit from a
Clean Fuels Policy
While not a definitive list, there
are various ways that credits
might be generated to benefit
agricultural producers to
compensate for adoption of
practices that offer GHG
reductions. These are options for
policy makers to consider in
designing a clean fuels policy
that benefits farmers.
• Agricultural producer
generates credits, selling
them to a biofuel producer.
• Agricultural producer
generates credits, selling
them to any market
participant.
• Cooperative/grain
aggregator owns credits and
pays a higher price for
commodities from
agricultural producers.
• Biofuel producer owns
credits, negotiating with
agricultural producers to
pass on the value.
• United States Department of
Agriculture Natural Resource
Conservation Service or
state conservation service
owns credits, passing on
credit value as cash-match
for adoption of practices.
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verification by other entities, including other states with clean fuels
policies and voluntary programs seeking GHG reductions from
agricultural supply chains. Farm practices verification should be
something the Midwest leads on and is proud of and enables the region
to produce the lowest CI agricultural products in the nation and world.
o States should consider setting aside a percentage
2
of overall credit
revenue to directly invest in adoption and scaleup of agricultural practices
that benefit soil health and water quality, consistent with existing state
and federal efforts. These practices may also increase soil carbon
storage, reduce nitrous oxide emissions, or both. These activities should
complement current investments. States should avoid diverting credit
revenue for purposes unrelated to the clean fuel policy, but this issue is
important enough to be the exception to the rule.
• Carbon capture and storage. States should recognize the potential for CI
reductions from carbon capture, utilization, and storage from ethanol, renewable
natural gas, and other low-carbon fuel producers.
• Fueling infrastructure is essential for transitioning to a cleaner fuel system.
Broad consumer access to cleaner fuels should increase and accelerate the
benefits of a clean fuel policy. States should consider allowing credit generation
for underutilized infrastructure for fuels with under-served passenger car
populations, including E85 and mid-level blend, EV charging stations, and
hydrogen fueling.
Areas for Future Work
The Initiative recommends a few areas where additional work is needed:
• Farm-level carbon accounting. The stakeholder group has a strong interest in
developing the ability to compensate farmers for conservation practices that
increase soil organic carbon storage and/or reduce nitrous oxide emissions.
While this idea is appealing in principle, much more work is needed to determine
how this could work in practice.
• Biofuel credit value distribution. There is a concern that in the California LCFS
market, refiners have been able to prevent credit value from reaching biofuel
producers, farmers, and consumers because of California’s ethanol blending limit
2
The group has not taken a position on a specific percentage and numbers as high as 30 percent were
discussed.
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of E10 and the abundance of low carbon ethanol on the market. Additional policy
design consideration is needed to assure that credit revenue from low carbon
biofuels reaches its intended beneficiaries, resulting in economic benefit for
farmers and biofuel producers and cost savings for fuel consumers.
• Electricity credit distribution. More work is needed to determine who can
generate credits for EVs and how this credit value can best be used to achieve
the goals of the program. Electric vehicle credits should be used in a timely
manner to accelerate market adoption.
Conclusion
The Midwestern Clean Fuels Policy Initiative deliberated for a long period of time before
publicly releasing this white paper. A clean fuels policy is complicated and requires
careful consideration of many details. This white paper offers high-level considerations
on how to structure a policy to benefit the Midwest. More work will be required.
The Midwestern Clean Fuels Policy Initiative is unique in its ability to draw in a broad
range of organizations that do not always work together. The Initiative includes
agriculture, biofuels, the nonprofit sector, the EV community, auto manufacturing, and
the electric utility sector. This group sees power in a collaborative approach and will
continue working together to refine a Midwestern clean fuels policy to achieve its vision
with broad economic and environmental benefits.
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Technical Glossary
Argonne GREET model: Updated annually, the
Greenhouse gases, Regulated Emissions, and Energy
use in Transportation—or GREET—model was created
and is maintained by Argonne National Laboratory. The
tool simulates energy use and emissions outputs for
various vehicle and fuel combinations to generate a full
life cycle estimate. The model is available at Argonne’s
GREET website, https://greet.es.anl.gov/.
Biofuel: Per the US EPA, biofuels are gaseous or liquid
fuels developed through the conversion of biomass into
liquid fuels. Sources for biomass can include: grassy and
woody plants, agriculture or forestry residue, algae,
crops (such as corn or soybeans), vegetable oils, organic
waste, or animal fats. The two most common biofuels are
ethanol and biodiesel.
Biogas: A mixture of gases produced by the breakdown
of organic matter in the absence of oxygen, primarily
consisting of methane and carbon dioxide.
Biogenic CO
2
: Per the US EPA, CO
2
emissions related
to the natural carbon cycle, as well as emissions from
the production, harvest, combustion, digestion,
fermentation, decomposition, and processing of
biologically based materials.
Biologically-based feedstocks: As defined by the US
EPA, non-fossilized and biodegradable organic materials
originating from modern or contemporarily grown plants,
animals, or microorganisms (including products, by-
products, residues, and wastes from agriculture, forestry,
and related industries, as well as the non-fossilized and
biodegradable organic fractions of industrial and
municipal wastes, including gases and liquids recovered
from the decomposition of non-fossilized and
biodegradable organic material). These do not include
materials like peat, coal, petroleum, natural gas, and
other products that are derived from biologic materials
but are non-renewable relative to a policy-making
timeframe. More can be read in the EPA’s Framework for
Assessing Biogenic CO
2
Emissions report, at
https://www3.epa.gov/climatechange/Downloads/Frame
work-for-Assessing-Biogenic-CO2-Emissions.pdf.
Blending requirements: A policy or mandate that
requires a certain volume of renewable fuel to replace or
reduce the quantity of petroleum-based transportation
fuel, heating oil or jet fuel. For example, the United
States adopted a Renewable Fuel Standard, and many
individual states have biofuel blending requirements.
Carbon capture: Refers to a group of technologies that
prevent industrial and electric power facility carbon
emissions from reaching the atmosphere or remove
carbon dioxide (CO
2
) from the atmosphere.
Carbon-dioxide equivalent (or CO
2
e): a standardized
unit for measuring carbon footprints; CO
2
e calculates the
equivalent impact of criteria pollutant greenhouse gas
(GHG) emissions such as nitrous oxide and methane.
CO
2
e allows for consistent comparison across practices,
processes, and emission metrics.
Carbon intensity (CI): Regarding fuels, CI refers to the
lifecycle GHG emissions for a fuel per unit of
transportation energy delivered. The CI of a fuel is
calculated by assessing the GHG emissions in the
lifecycle or “pathway” of the fuel and is determined by
assessing the GHG emissions throughout each stage of
the fuel’s feedstock production, conversion, and use. CI
is measured in grams of CO
2
-equivalent per mega joule
(gCO
2
e/MJ or g/MJ).
Carbon intensity reduction targets: For a clean fuels
policy, carbon intensity reduction targets are set for the
gasoline and diesel standard(s). Targets are typically a
proportional reduction achieved by a specific date (i.e.,
15 percent carbon intensity reduction by 2030). Targets
are used to establish total emission reductions achieved
by a policy.
Carbon storage: Typically coupled with carbon capture,
carbon storage refers to the long-term sequestration of
carbon dioxide in geologic formations or fossil reservoirs.
Clean fuel: fuel that results in lower lifecycle GHG
emissions on an energy equivalent basis compared to a
reduction baseline.. See also, low carbon fuel.
Clean fuels policy: Refers to a policy or program that
requires fuels to achieve carbon intensity reductions over
time.
Co-products: Refers to secondary goods that are
generated during the manufacturing process and can be
sold or reused profitably. Co-products may also be
manufactured together or sequentially because of
product or process similarities. Co-products include main
product, byproduct, residue, or waste.
Credit bank: Refers to the net stock of credits generated
or owed from a market-driven policy, like a clean fuels
standard. When an alternative fuel pathway generates
credits relative to the carbon intensity of the standard,
the total credits in the bank increase.
Decarbonization: Refers to the process of reducing the
average amount of carbon emissions or carbon intensity
in a system (for example, transportation sector) over a
period of time.
Energy economy ratio (EER): A dimensionless value
that accounts for the difference in energy density and
engine efficiency when calculating carbon intensity or
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credit generation. Generally, EER represents the
efficiency of a fuel as used in a practice (in a powertrain)
compared to a reference fuel.
Electric grid mix: The proportional contribution of
various electricity generation fuels (i.e., natural gas,
petroleum, renewables, etc.) to the total electricity
generation of the energy grid. The grid mix is important
to help calculate the carbon intensity or emissions factor
of a specific utility or electricity region.
Electric vehicle (EV): A vehicle powered by electricity,
generally provided by electric batteries or fuel cells.
Electric vehicle charging station: The fueling
infrastructure for electric vehicles that connects an EV to
an electricity source. Charging stations are characterized
by their voltage—Level 1 chargers operate on 120V
alternating-current (AC), Level 2 use 240V alternating-
current (AC), and DC fast chargers (DCFC) use 480V
direct-current (DC). Charger level also informs speed of
battery recharge where Level 1 is the slowest and DCFC
is the fastest.
Emissions factor: An emissions factor is a
representative value that relates the quantity of a
pollutant released to the atmosphere with an activity
associated with the release of that pollutant. These
factors are usually expressed as the mass of pollutant
divided by a unit mass, volume, distance, or duration of
the activity emitting the pollutant (e.g., kilograms of
particulate emitted per megagram of coal burned). For a
clean fuels policy, emissions factor helps understand, for
example, the CO
2
e emissions associated with one mega
joule of fuel used. See also, a carbon intensity.
Energy security: Refers to the relative confidence that
energy (through the electric grid, fuel producers, or from
a biological feedstock) will be reliable and cost effective.
For example, in the context of the liquid fuel supply,
increased energy security corresponds to increased
confidence that liquid fuels will be distributed safely and
consistently to consumers.
European Union (EU) renewable energy directive
(RED): A policy adopted by the EU that sets a binding
target of 20 percent gross energy consumption from
renewable sources by 2020 (20 percent RES). To
achieve this, the Directive allocates individual targets to
Member States ranging from 10 percent in Malta to 49
percent in Sweden. It was followed by RED II, which
increased 2030 targets to 32 percent. More info on the
EU Science Hub,
https://ec.europa.eu/jrc/en/jec/renewable-energy-recast-
2030-red-ii.
Fuel pathway: The fuel pathway is the sequence of
production processes used to produce a fuel and acquire
or grow the feedstock it is made from. In lifecycle
analysis, the fuel pathway is considered on a “well-to-
wheels” or “cradle-to-grave” basis, which includes
feedstock production or extraction, transportation of
feedstock and fuel to the production facility, fuel refining,
fuel transportation and distribution, and finally fuel use or
combustion. The fuel pathway is used to calculate the
carbon intensity of a fuel, which is determined by
assessing the GHG emissions throughout each stage of
the fuel’s production and use.
Fugitive emissions: Fugitive emissions are emissions
of gases or vapors from pressurized equipment due to
leaks and other unintended or irregular releases of
gases, mostly from industrial activities. The US EPA
further clarifies fugitive emissions as unintended
emissions from facilities or activities (e.g., construction)
that "could not reasonably pass through a stack,
chimney, vent, or other functionally equivalent opening."
Fugitive hydrocarbons: A form of fugitive emissions,
specifically of volatile hydrocarbons that can contribute to
the formation of smog and ozone.
Greenhouse gas emissions (GHGs): Gases that trap
heat in the atmosphere are called greenhouse gases.
The most prevalent are carbon dioxide, methane, nitrous
oxide, and fluorinated gases (which consist primarily of
hydrofluorocarbons, perfluorocarbons, sulfur
hexafluoride, and nitrogen trifluoride) which are synthetic
GHGs emitted from a variety of industrial sources. The
impact of each gas with regards to climate change is
determined by three main factors: the concentration or
abundance in the atmosphere, how long it can last in the
atmosphere, and its potency.
Induced land use change (ILUC): Emissions resulting
from land conversion in response to increased biofuel
demand and impacts on global commodity prices and
commodity demand.
Lifecycle accounting: The practice of tracking and
scoring the carbon intensity of fuels by including the full
lifecycle GHG emissions impact of feedstock extraction,
fuel refining, distribution, and use or combustion.
Lifecycle accounting uses the carbon intensity score
produced through a lifecycle assessment (LCA) analysis.
Lifecycle assessment (LCA): A technique to assess
environmental impacts associated with all the stages of a
product's life from raw material extraction through
materials processing, manufacture, distribution, use,
repair and maintenance, and disposal or recycling.
Low-Carbon Fuel Standard (LCFS): A rule enacted to
reduce carbon intensity in transportation fuels as
compared to conventional petroleum fuels, such as
gasoline and diesel. LCFS uses market-based
mechanisms that allow providers to choose how they will
reduce emissions while responding to consumer
demand. California adopted a Low Carbon Fuel
Standard in 2007 that requires a reduction in the carbon
intensity of transportation fuels that are sold, supplied, or
offered for sale in the state by a minimum of 10 percent
by 2020.
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Low-carbon fuel: fuel that results in lower lifecycle GHG
emissions on an energy equivalent basis compared to a
reduction baseline. See also, clean fuel.
Nitrous oxide emissions: Nitrous oxide is a
greenhouse gas emitted during agricultural and industrial
activities, combustion of fossil fuels and solid waste, as
well as during treatment of waste water. Nitrous oxide
was 6 percent of US GHG emissions in 2017 according
to US EPA, and has a global warming potential of 298
times carbon dioxide. The application of nitrogen
fertilizers accounts for the majority of nitrous oxide
emissions, and these emissions can be reduced through
various agricultural conservation practices.
Portfolio approach: Refers to the use of multiple clean
fuels or strategies to achieve a policy, social, or
environmental goal.
Renewable energy credit (REC): A certificate
corresponding to the environmental attributes of energy
produced from renewable sources such as wind or solar,
or other carbon reducing activities.
Renewable Natural Gas: Biogas that has been
upgraded to a quality similar to fossil natural gas.
Soil carbon management: Soil carbon management
refers to any activity used to store or sequester higher
amounts of carbon in soil organic matter. In agricultural
contexts, this may include tillage practices, fertilizer
application management, cover cropping, and system
rotation, among many others. Soil carbon management
can reduce carbon dioxide in the atmosphere and
improve soil health.
Soil organic carbon (SOC): The solid terrestrial matter
stored in global soils. It is considered an indicator of soil
health and soil fertility.
Utility green tariff: As defined by the US EPA, utility
green tariffs are optional programs in regulated electricity
markets offered by utilities and approved by state public
utility commissions (PUCs) that allow customers to buy
bundled renewable electricity from a specific project
through a special utility tariff rate. Utility green tariffs
provide larger energy customers an option to meet their
varying sustainability and renewable energy goals,
reduce long-term energy risks, and demonstrate
commitment to the development of new renewable
energy projects.
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Appendix: Existing State Policies and
Regulations that Provide a Foundation for Clean
Fuels Policy Development in the Midwest
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A Clean Fuels Policy for the Midwest
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A Clean Fuels Policy for the Midwest
GREAT PLAINS INSTITUTE
A Clean Fuels Policy for the Midwest
GREAT PLAINS INSTITUTE