Report shows CARB’s ILUC assumptions obsolete and should be revised

In California, as the California Air Resources Board (CARB) prepares to hold a Biofuels and Land Use Change Public Forum this week, a comprehensive new report from Life Cycle Associates, Advances in Estimation of Land Use Change Emissions Associated with Ethanol, shows that CARB’s decade-old estimate of hypothetical indirect land use change (ILUC) associated with ethanol is obsolete and should be revised.

California last conducted an analysis of ILUC in 2014 and 2015, when economic models were less refined for the purpose of estimating land use change and limited historical data were available for the period when the Renewable Fuel Standard (RFS) and the California Low Carbon Fuel Standard (LCFS) had been in effect.

According to Life Cycle Associates, “The cumulative effect of methodological improvements has been a steady reduction in estimated GHG emissions from corn ethanol land use change, producing results that are more consistent with observed global market behavior.” After extensively reviewing the evolution of models and emissions factor estimates, they conclude, “These improvements have allowed for a more nuanced and accurate assessment of how modeled biofuel shocks in response to different policies affect land use and associated GHG emissions. A key outcome of these analysis efforts is a reduction in predicted GHG emissions from LUC associated with corn ethanol.”

They also state, “Analysts recommend using the [Global Trade Analysis Project, or GTAP] 2017 model for its latest data and refinements.”

This is more than an academic exercise, noted the Renewable Fuels Association. CARB applies its decade-old ILUC penalties to every gallon of corn- and sorghum-based ethanol sold into California, with no evidence that such land use changes have actually occurred. Importantly, U.S. cropland area has declined since the RFS was expanded in 2007, according to both the USDA Census of Agriculture and the EPA. And, as detailed in RFA comments to CARB earlier this year, the corn area needed to meet California ethanol demand has decreased by more than 700,000 acres—or 20 percent—since the LCFS program began in 2011. Considering this,  ILUC scoring artificially affects demand and reduces the market value of ethanol, based purely on flawed, obsolete, and speculative modeling results.