Pricesfor California Low-Carbon Fuel Standard credits averaged $112/tonne in June,down $7 on the month, even as volumes climbed. According tomonthly datareleased by the California Air Resources Board, California LCFS prices rangedfrom a low of $81.00/tonne to a high of $128.00 /tonne in June.
Theagency said 95 transfers took place during the month, for a total volume of429,000 credits. The CARB reported63 entities were sellers in June, while 29 parties were buyers of CaliforniaLCFS credits that month. A total of 41 entities were both sellers and buyers ofcredits in June.
On aquarterly basis, the average price for California LCFS credits was $116/tonneduring the second quarter and $114/tonne during the first three months of theyear. This compares to an average of $90/tonne during the fourth quarter of2015.
The CARB'smonthly statistical data includes transfers that were proposed and completed aswell as those that were proposed and still pending buyer's confirmation in theLCFS Reporting Tool and Credit Bank and Transfer System.
CaliforniaLCFS credit prices had been running higher after the CARB voted in September2015 to readopt the state's LCFS regulation with some alterations. The LCFSrequires California fuel providers to calculate the carbon intensity of fuelsold for transportation, including imported fuel. The program requires thereduction of average carbon intensity of fuels by 10% by 2020, imposing agradual cap on carbon intensity levels in the years preceding.
Thereadopted LCFS ratchets up the carbon intensity target reduction levels from2016-2019 since the level had been frozen at a 1% cut below 2010 levels in 2013after legal challenges. With the re-adoption, the reduction in carbon intensitylevels is pegged at 2% in 2016, 3.5% in 2017, 5% in 2018, 7.5% in 2019 and 10%in 2020 and beyond.
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