Renewable and Low Carbon Fuel Requirements Regulation FAQ

Under the Regulation, fuel suppliers must ensure they supply the required minimum renewable fuel content, on a provincial annual average basis, in the fuel they supply in B.C.

The renewable fuel requirement for gasoline is a five percent annual average. The renewable fuel requirement for diesel is a four percent annual average.

The low carbon fuel requirement requires the fuel suppliers to reduce the average carbon intensity (CI) of transportation fuels by ten percent by 2020. This requirement uses life cycle assessment to determine the overall CI of fuels used for transportation and includes all factors associated with the production and consumption of each fuel. This includes exploration and production of fossil fuels, production of crops for biofuels and the refining, transport and end use of the fuel. Back to top

2. What fuels are regulated?

The renewable fuel requirements apply to gasoline and diesel fuel when used for transportation or heating. The low carbon fuel requirements apply to gasoline, diesel fuel, natural gas, propane, ethanol, biodiesel and electricity when used for transportation. New low carbon fuels will be added as they become commercially available.

Fuel used for military operations is not included in the Regulation. Back to top

3. Who is subject to the Regulation?

All fuel producers and importers in British Columbia are considered to be fuel suppliers and are therefore subject to the Regulation.

Suppliers who provide less than a total of 75 million litres of gasoline and diesel class fuels in a compliance period are exempt from the requirements to deliver renewable content and to reduce carbon intensity. For more information about the small supplier exemption, please refer to Information Bulletin RLCF-005.

The Regulation does not apply to imported fuel in the tank of a vehicle when that fuel is used to power the vehicle.

4. What are the benefits of the Regulation?

The use of renewable fuel in 2010 saved 418,919 tonnes of greenhouse gas emissions from being released into the environment, the equivalent of about 82,000 cars being removed from the road.

The Regulation will help reduce the environmental impact of transportation fuels and contribute to a low-carbon economy. This legislation supports B.C.’s goal to lower provincial greenhouse gas (GHG) emissions by 33 percent by 2020.

The Regulation enables the Province to set benchmarks for the amount of renewable fuel in B.C.’s transportation fuel blends and reduce the CI of transportation. As well, the Regulation creates additional choices for consumers to reduce their reliance on non-renewable fuels. Back to top

5. How will the Regulation affect consumers?

The Regulation will help consumers reduce their reliance on non-renewable fuels, diversify B.C.’s transportation fuel supply, decrease GHG emissions and establish a sustainable market for low-carbon and renewable fuels.

Any increase to the cost of fuel as a result of the new requirements will be nominal and should disappear when more renewable fuels become available.

Vehicle performance should not be affected. Fuel suppliers will maintain the quality of fuel and ensure that the fuel blends do not exceed renewable content levels supported under typical consumer vehicle warranties. Back to top

6. Where will the renewable content come from?

In the near-term it is expected that B.C.'s renewable fuel needs will be met with fuels from Canadian and international suppliers. In the longer-term, however, it is expected that demand will encourage the development of new suppliers in Canada and B.C. Back to top

7. Where will the renewable content be sold?

The Regulation applies to the entire province, but does not require renewable fuel to be supplied in any particular region. Fuel suppliers have the flexibility to vary their blend percentages and can choose where in the province they supply renewable fuel blends, so long as they meet the provincial annual average requirement for renewable fuel content. Back to top

8. What renewable fuels are being used in the diesel pool?

There are two types of renewable diesel known to be supplied in British Columbia. Both are made from feedstocks that range from tallow and restaurant waste oil to canola.

Biodiesel is a fatty acid methyl ester (FAME) made by chemically converting the feedstock into biodiesel. In order to meet the requirements of the Regulation, biodiesel must meet the ASTM D6751 Standard Specification for Biodiesel Fuel Blend Stock (B100) for Middle Distillate Fuels.

Hydrogenation-derived renewable diesel (HDRD) is made in a refinery by hydrogenating the renewable feedstock and then processing the oil in a modified refinery process. The resulting fuel is a high-quality diesel fuel that meets all the specifications for petroleum diesel. Back to top

9. What is the labelling requirement?

A person that provides gasoline class fuel containing more than 10% ethanol or diesel class fuel that contains more than 5% biodiesel on and after January 1, 2011 must provide a label to indicate fuel content.

Fuel labelling will ensure that consumers are provided with the information they need to make informed decisions about the appropriate fuel for their vehicle operating needs. The fuel labelling requirement will inform customers when fuels contain greater than the prescribed levels of ethanol or biodiesel. For more information regarding the labelling requirement, please see Information Bulletin RLCF-004. Back to top

10. Who must apply labels?

The retailers (pump operators) must apply the appropriate labels whenever fuel contains more than 10 percent ethanol or five percent biodiesel. Note that under the British Columbia Cleaner Gasoline Regulation, it is currently not permissible to sell gasoline in British Columbia that contains more than 10 percent ethanol. Back to top

11. What are "life cycle" emissions?

Lifecycle assessment is defined as a systematic set of procedures for compiling and examining the inputs and outputs of materials and energy and the associated environmental impacts directly attributable to the functioning of a product or service system throughout its lifecycle.

The low carbon fuel requirement will use a full life cycle or "well to wheel" approach to measuring GHG emissions. As such, it includes the GHG emissions from all of the activities involved - from the extraction of feedstock, to the production of the fuel, through to the use of the fuel. Typical life cycle stages include:

upstream activities such as producing petroleum, or agricultural activities to grow and harvest crops;
midstream activities such as refining petroleum, or converting agricultural products into fuel, and transporting the fuels to markets; and,
downstream activities, including the end use (combustion) of the fuel in an engine. Back to top

12. What is carbon intensity?

Carbon intensity (CI) is the amount of carbon dioxide equivalent emitted per unit of energy consumed. It includes all of the carbon dioxide and other GHG emitted throughout the life cycle of a fuel. Renewable fuels generally have lower CI than non-renewable fuels.

For the carbon intensity table of some fuels identified in GHGenius, please see Fuel Carbon Intensities. Back to Top

13. What are the required average carbon intensity limits between 2010 and 2020?

Each year fuel suppliers are required to ensure that their annual weighted average carbon intensity is below a required level. The following table and chart show the required carbon intensities from 2010 to 2020:

Year	Average Carbon Intensity Requirement (g/MJ)
2010	reporting year only
2011	90.21
January 1, 2012 to June 30, 2013	90.21
July 1, 2013 to December 31, 2014	80.79
2015	79.97
2016	79.15
2017	77.92
2018	76.69
2019	75.46
2020	73.82

In June, 2011, the Province announced that British Columbia’s Clean Technology Parliamentary Secretary to the Minister of Energy and Mines, MLA John Yap, would consult with industry on how to improve British Columbia’s low carbon fuel requirements. In December 2011, the Ministry announced amendments to the Renewable and Low Carbon Fuel Requirements Regulation based on that consultation. Back to top

15. As a fuel supplier, how do I report?

The reporting requirements are explained in Information Bulletin RLCF-003. The reporting forms are available at: http://www.empr.gov.bc.ca/RET/RLCFRR/Pages/default.aspx. Back to top

16. I buy some fuel in B.C. and some I import from Alberta. What fuel am I responsible for?

You are responsible for the fuels that you import or manufacture. For fuels that you acquire in B.C., you become responsible if you agree in writing to report those fuels as part of your fuel pool. Back to top

17. If I sell fuel to another supplier who is exempt under the Regulation, who is responsible for compliance?

The exempt supplier is responsible for reporting volumes during the compliance period. The person who agrees in writing to report is the person responsible for compliance. Back to top

18. How will the Province enforce compliance with the Regulation?

Fuel suppliers will be required to submit annual reports regarding the CI of the transportation fuels they supply. Suppliers who do not comply with the requirements will be subject to monetary penalties. The Province allows transfers of GHG credits between fuel suppliers to provide flexibility in meeting the requirements of the regulation. Back to top

19. What is the penalty for non-compliance?

For the Renewable Fuel Requirement, the penalty is calculated as the number of litres that a supplier falls short of the required volume multiplied by the penalty rate. The penalty rates are $0.30/litre for gasoline class fuel and $0.45/litre for diesel class fuel.

For the Low Carbon Fuel Requirement, the penalty rate is $200/tonne of CO2 equivalent emissions. Back to top

20. What is GHGenius and how is it used to calculate carbon intensities?

GHGenius is a spreadsheet used to conduct lifecycle assessments for transportation fuels. It is used to calculate the amount of greenhouse gases generated from the time a fuel is extracted or grown to the time that it is combusted in a motive energy vehicle to produce power.

GHGenius is owned and managed by Natural Resources Canada and may be downloaded from www.ghgenius.ca. Back to top

21. Can I use a different life cycle assessment model?

The director may approve alternatives to the GHGenius assessment of a fuel, but the results will need to be consistent with results that GHGenius would produce from the same data. Back to Top

22. How do I calculate the average carbon intensity of the fuels I supply?

A detailed example is available in Information Bulletin RLCF-002. Back to top

23. How do I determine the carbon intensity for an individual fuel?

For the purposes of complying with the Regulation, there are three different methods to determine the CI of a fuel. For details, please see Information Bulletin RLCF-006. Back to top

24. What if I do not know the carbon intensity of a fuel?

If you do not know the carbon intensity of a fuel, you cannot claim the fuel has specific GHG benefits, and will have to choose the default value for either diesel or gasoline. For example, ethanol of unknown origin would be considered to have the carbon intensity of gasoline class fuel, as specified in the Regulation. Back to top

25. When the carbon intensity is calculated does it include the vehicle operation and vehicle materials, assembly and transport?

Emissions from vehicle assembly and transport as well as materials in vehicles and lube oil production/use are not included in the life cycle analysis of the fuel since they are not properties of the fuel itself. GHGenius (www.ghgenius.ca), the model used to determine carbon intensity values, calculates emissions from these sources, and suppliers should not include them in the analysis. Back to top

26. How do we distinguish crudes and refining processes?

The default values for gasoline and diesel class are determined using GHGenius (www.ghgenius.ca). GHGenius accommodates a mix of sources and processes that represent the fuel life cycles that are typical for B.C., including some fuels from oil sands. If a company feels that they have a fuel with a better CI, they will be able to apply to the Director to have that CI recognized. Back to top

27. How do I reduce the average carbon intensity of the fuels I supply?

The reduction in CI can be achieved in a number of ways, including:

Reducing the CI of the fuels currently supplied. This could be achieved through innovations in efficiency such as improving refining processes to reduce emissions or implementation of new carbon management practices such as carbon capture and storage;

Supplying more low carbon fuels, such as propane, natural gas, electricity or hydrogen, or renewable fuels like biodiesel or ethanol; and/or

Obtaining low carbon fuel credits from another supplier who supplies lower carbon fuels. Back to top

28. Who will verify the CI that is claimed by the regulated party?

The Director, as designated in the legislation, will determine whether a CI is acceptable. Inspectors will verify claims based on the evidence provided showing that the actual fuels conform to the reported CI. If a company wishes to have processing improvements recognized, or wishes to introduce a new fuel or a new life cycle assessment, they may apply to the Director. When the application is approved, the company may use the values when reporting See Information Bulletin RLCF-006 for more details. Back to top

29. What happens if I am not satisfied with the Director’s ruling?

If all efforts to reach an agreement have failed, a fuel supplier may appeal the Director’s ruling to the Environmental Appeal Board. Back to top

30. Is it possible to generate or store low carbon fuel credits before June 30, 2013?

No. Credit generation will not occur until July 1, 2013. Back to top

31. How does the Regulation fit into the Government’s GHG Reduction Strategy?

The Ministry of Energy is working closely with our colleagues at the Climate Action Secretariat to ensure that the Regulation supports the objectives under the Climate Action Plan and the 2007 BC Energy Plan.

You can learn more about BC’s GHG reduction strategy at http://www.env.gov.bc.ca/cas/. Back to top

32. How do I find more information?

For more information about the Regulation, please email questions to: lcfrr@gov.bc.ca.

To find out more about what other Canadian provinces and the federal government are doing to promote renewable fuels for transportation in Canada, see:

Canada’s Renewable Fuels Regulation under the Canadian Environmental Protection Act

Alberta’s Renewable Fuels Standard under the Climate Change and Management of Emissions Act

Saskatchewan’s Ethanol Fuel (General) Regulation under the Ethanol Fuel Act

Manitoba’s Energy Development Initiative

Ontario’s Ethanol in Gasoline Regulation under the Environmental Protection Act

To find out more about what other jurisdictions are doing, see:

US Renewable Fuel Standard

California’s Low Carbon Fuel Standard

European Union’s Renewable Energy Directive

To learn more about renewable fuels, see:

Canadian Renewable Fuels Association

National Biodiesel Board