Judge upholds California’s low-carbon fuel standards

A federal judge has upheld most of California’s pioneering low-carbon fuel standard but allowed oil companies and other fuel suppliers to challenge rules that may favor California ethanol producers over their Midwest competitors. The standard, part of a 2006 state law intended to reduce air pollution that causes global warming, requires suppliers of transportation fuel sold in California to achieve a 10 percent reduction by 2020 in the amount of carbon released from their products. Ruling in lawsuits originally filed in 2009 by oil refiners and ethanol producers, U.S. District Judge Lawrence O’Neill of Fresno rejected their broadest arguments: that the California rules conflicted with milder federal clean-air laws and were an unconstitutional attempt to shield the state’s energy producers from competition. Because state officials have conceded that the carbon standard, by itself, will not significantly reduce global climate change, he said, the Midwestern producers “plausibly have alleged” that the ethanol standard “imposes burdens on interstate commerce that outweigh the local benefits it provides.”