DEQ's Clean Fuels Program

The policy goal of the program is to reduce the carbon intensity of Oregon’s transportation fuels by establishing annual standards that decrease over time. The program began in 2016 and the standards decline incrementally each year with milestones to achieve a 10% reduction in 2025, a 20% reduction in 2030 and a 37% reduction in 2035.  

Carbon intensity is the measure of greenhouse gas emissions throughout the lifecycle of transportation fuels. The lifecycle measured by the program encompasses emissions from the extraction, refining or production, transportation to a dispensing facility, and combustion of the fuel. The lower the fuel’s carbon intensity, the lower its total emissions and a greater reduction in emissions is realized relative to the fossil gasoline or diesel they displace.

Fuels that are lower than the annual standard generate credits, while fuels that are higher than the annual standard generate deficits. Credits and deficits are measured in metric tons of greenhouse gas emissions. At the end of each calendar year, a fuel provider must retire enough credits to offset the number of deficits they generated in order to be in compliance with the standards. Credits can be sold to businesses that need them to comply which in turn creates revenue for the businesses that provide the low-carbon fuels that generate credits. The credits encourage fuel suppliers to source and supply the lowest carbon fuels to customers in Oregon.

A deficit represents a metric ton of emissions that are above the standard and a credit represents a metric ton of emissions that are below the standard. Any excess of credits above the number of deficits can be banked and used for future compliance.

The Clean Fuels Program reduces greenhouse gas emissions by providing incentives to further develop and commercialize low-carbon fuels.  

From the beginning of the program in 2016 through 2021, approximately 6.8 million metric tons of greenhouse gas emissions have been reduced because of the program.

The first six years of the Clean Fuels Program have included many early successes. Greenhouse gas emissions and tailpipe air pollution have been reduced throughout Oregon. The use of biofuels has increased and they are getting cleaner. New fuels like renewable diesel, renewable natural gas, renewable propane, and hydrogen have entered the market.

Oregon’s transition to zero emission technologies is kicking into high gear. The Clean Fuels Program has been and will continue to be a key driver of this transformation.

Partnerships - internal to DEQ, with other government agencies, with our utilities, and with our market participants – have been, and will continue to be the cornerstone of creating a comprehensive plan to decarbonize Oregon’s transportation fuels. The recent expansion of the Clean Fuels Program provides assurance that Oregon is committed to this plan.

For more information,  visit our web pages at DEQ Online .

Read the full report:  2022 Oregon Clean Fuels Program Review