By: Nicole Zub

One state is helping cleaner fuel standards become the norm across the country, supported by a recent federal court ruling. In 2009, Oregon authorized the Clean Fuels Program to combat climate change caused by automobile emissions.[i] The goal was to reduce greenhouse gas emissions from transportation fuels by ten percent over a ten-year period by requiring oil companies to gradually reduce their carbon pollution.[ii] The companies have a few options to meet this goal: blend lower-carbon fuels, or simply invest in a variety of other clean fuels.[iii] It requires importers of transportation fuels to reduce the average carbon intensity of fuels that are provided in Oregon to comply with the program.[iv]

Not surprisingly, the oil and trucking industry challenged the state’s new rule, arguing that it unconstitutionally discriminated against transportation fuels from other states.[v] The plaintiffs, American Fuel & Petrochemical Manufacturers, American Trucking Associations, Inc., and Consumer Energy Alliance, also stated that federal law preempted Oregon’s new law.[vi] However, the United States District Court for the State of Oregon dismissed the oil industry’s claims entirely.[vii] The court found that “the Oregon Program is not facially discriminatory because it distinguishes among fuels based on lifecycle GHG emissions, not origin or destination.”[viii] In actuality, the Oregon program assigns twelve out-of-state ethanol pathways with carbon intensities lower than the value the plaintiffs alleged was discriminatory.[ix]

Judge Ann Aiken, who delivered the court’s opinion, also stated that the federal preemption arguments were implausible.[x] Furthermore, the Ninth Circuit Court of Appeals had previously ruled against these same groups when similar challenges were made to California’s clean fuel standards.[xi] In 2013, the Ninth Circuit held that the plaintiffs had no standing to assert that California’s Low Carbon Fuel Standard was preempted by the federal ethanol mandate and the standard did not conflict with federal gasoline regulations by taking into account methane that’s emitted during ethanol production.[xii] Additionally, Oregon’s Clean Fuels Program is meant to regulate fuels for a legitimate purpose, specifically one based on their climate impacts.[xiii]

A program of this nature encourages investment and innovation in the area of alternative fuels, regardless of where the advancements are occurring.[xiv] A ruling of this nature will likely encourage other states to follow suit with similar programs. Currently, the Kentucky Clean Fuels Coalition, established in 1993, is the leading non-profit organization in the state attempting to incorporate alternative fuels and technologies that fall within the bounds of clean air quality and sustainability.[xv] Hopefully this recent ruling will inspire Kentucky to create its own clean fuels program, incentivizing clean transportation fuels development for commuters and reduce the state’s carbon footprint.

[i] Amanda Goodin, Oregon Paves the Way to Cleaner, Greener Cars, Earthjustice (Oct. 6, 2015), http://earthjustice.org/blog/2015-october/oregon-paves-the-way-to-cleaner-greener-cars.

[ii] Oregon Clean Fuels Program, Oregon Dep’t of Envtl. Quality, http://www.deq.state.or.us/aq/cleanFuel/ (last visited Oct. 20, 2015).

[iii] Oil Industry Attack on Oregon’s Clean Fuels Standard Dismissed, Earthjustice (Sept. 24, 2015), http://earthjustice.org/news/press/2015/oil-industry-attack-on-oregon-s-clean-fuels-standard-dismissed.

[iv] Goodin, supra note i.

[v] Id.

[vi] Linda Chiem, Oil, Trucking Groups Lose Challenge to Oregon Fuel Standard, Law360 (Sept. 25, 2015), http://www.law360.com/articles/707248/oil-trucking-groups-lose-challenge-to-oregon-fuel-standard.

[vii] Id.

[viii] Id.

[ix] Id.

[x] Id.

[xi] Oregon’s Low Carbon Fuel Standard Withstands Industry Litigation, Sierra Club (2015), https://content.sierraclub.org/environmentallaw/lawsuit/2015/oregons-low-carbon-fuels-standard-withstands-industry-litigation.

[xii] Id.

[xiii] Oil Industry Attack on Oregon’s Clean Fuels Standard Dismissed , supra note iii.

[xiv] Id.

[xv] Kentucky Clean Fuels, http://kentuckycleanfuels.org/about-kcfc/ (last visited Oct. 20, 2015).