Controversial Oregon Fuel Law May Face Ballot Initiative

Kevin Anderson Regulations, Transportation

A controversial Oregon law dealing with fuel standards may face another challenge next year. This new challenge is in addition to the legal battle the law is fighting now through the federal court system.

The law being challenged from seemingly all fronts is known as Oregon’s Low Carbon Fuel Standard or, LCFS for short. At the time the governor signed the act into law, it was being criticized by Republicans and rural-area democrats because of the effect it would have on gas prices. And if none of the current challenges succeeds in defeating the law, it will stay in effect and the consequences will become very real, very soon.

LCFS Details and Requirements

The main purpose of the LCFS is to reduce the amount of carbon in fuel sold in Oregon. The goal is to reduce reduce greenhouse gas emission by 10 percent over a ten-year period. The law envisioned two different phases of implementation – the first stage was for planning and writing regulations. And that phase came to an end this  year. The second stage is the actual execution of the law’s goals, or to reduce the carbon levels in fuels sold in Oregon. The second stage went into effect earlier this year, and is the stage facing challenges.

The pushback on the LCFS is because of the fear that fuel prices will skyrocket as the law is put into effect. There are only a few different ways to reduce carbon levels in fuels. The primary answer is turning to biofuels, but this is expensive and some argue that it actually increases the greenhouse emission footprint because of all the effort that goes into extracting a usable fuel from sources such as corn and switchgrass.

Lawsuit and Ballot Challenge

Immediately after the second phase came into effect, there was a legal challenge against it. Several groups joined the lawsuit including the American Trucking Association, American Fuel & Petrochemical Manufacturers, and the Consumer Energy Alliance, and their lawsuit was based on the U.S. Constitution. The main thrust of the challenge was that the U.S. Constitution grants full authority to regulate interstate commerce to Congress, and by passing this law Oregon is essentially regulating the price of fuel for everyone who passes through and buys fuel there.

And recently, the state of Oregon asked the federal court hearing the challenge to dismiss the suit as premature, claiming it flies in the face of recent 9th Circuit Court opinions. The 9th Circuit Court of Appeals recently decided that California’s master plan for reducing greenhouse gases did not violate the Commerce Clause of the U.S. Constitution.

But now, the most recent challenge to the LCFS is that of a ballot initiative. A trucking company owner and industry leader have submitted the repeal of LCFS on a ballot initiative that could be on the ballot in 2016. However, recent polls show that a majority of Oregonians support the law, and do not want it to be overturned.

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