On December 30, 2009, eleven governors from the Mid-Atlantic and Northeastern region of the United States signed a Memorandum of Understanding (MOU) on the development of a low carbon fuel standard (LCFS). This MOU, which commits the signatory states to develop a proposed framework for a LCFS by early 2011, follows on the heel of the effort by the state of California to implement its own LCFS.

This is a typical pattern; in the past the Northeastern states followed California’s lead in developing automobile emission standards and caps on greenhouse gases. As with the California LCFS, the goal of the program being developed by the Northeastern states appears to be the promotion of electric vehicles and the expulsion of corn ethanol from the transportation fuel system.

To achieve this goal, California has had to creatively use the highly controversial concept of indirect land use emissions to ascribe to corn ethanol more greenhouse gas (GHG) emissions than it deserves. If California had not ascribed these indirect emissions to ethanol or if California had done any analysis of the indirect emissions associated with petroleum production (e.g. GHG emissions associated with all the military activity needed to protect world oil supplies and oil transportation routes) or electric vehicles (e.g. GHG emissions from activities like mining the materials needed to produce the batteries used in these vehicles), it would be clear that corn ethanol is considerably less carbon-intense than gasoline. As a result, California’s GHG reduction goals could be met by blending ethanol and the state’s policy objective of promoting electric vehicles through its LCFS would not be achieved.

This new MOU and accompanying “Overview of the Northeast and Mid-Atlantic States Initiative” make it clear that promotion of electric vehicles is a key goal of the LCFS, and that to achieve that goal these states intend to apply indirect emissions penalties only to ethanol. In fact, while the MOU states that the states will “commit to determine the lifecycle carbon intensity of fuels based on the best available science and analyses,” the only example of indirect emissions that the MOU references is “land use changes attributable to fuel production.”

These states have already drawn a bulls eye on the back of corn ethanol, and we can expect that they will take a pass on applying indirect emissions factors to any other fuel in the program.