CIPA Pushes Back on LCFS Math That Penalizes California Crude

Last week, the California Independent Petroleum Association submitted formal comments to the California Air Resources Board challenging the methodology used to calculate the 2024 statewide average crude carbon intensity under the Low Carbon Fuel Standard.

At issue is CARB’s continued reliance on the OPGEE 3.0 model to generate the crude average CI that drives the LCFS “incremental deficits” provision. CIPA’s comments focus squarely on the math, not the politics, arguing that the model systematically overstates the carbon intensity of California-produced crude while understating the CI of imported foreign oil.

CIPA highlighted a fundamental contradiction in CARB’s approach. While the state regularly touts emission reductions achieved through programs like the oil and gas methane rule, the updated OPGEE model nevertheless increases CI scores for in-state crude. At the same time, CI scores for foreign crudes decline, despite no evidence of new emission controls, enforceable standards, or verified data improvements overseas.

The model relies heavily on foreign default values that are neither enforceable nor verifiable, which is a sharp departure from the standards California applies to its own producers under Cap-and-Invest and the LCFS. The result is a regulatory framework that penalizes oil produced under the most stringent environmental rules in the world, while rewarding imports from jurisdictions with weaker oversight and longer, emissions-intensive transport distances.

CIPA also reminded regulators of a basic reality often lost in Sacramento modeling exercises: demand has not gone away. Californians still consume roughly 1.8 million barrels of petroleum per day, more than in 2014, even with aggressive EV incentives. Under CARB’s own 2045 carbon-neutrality scenarios, the state will still need approximately 400,000 barrels per day to supply more than 6,000 petroleum-based products essential to daily life, including transformer oil required to keep the electric grid running.

CIPA urged CARB to align its LCFS implementation with real-world outcomes by prioritizing locally produced, locally regulated crude, incentivizing genuine CI reductions, and ensuring that the last barrel used in California is produced under California’s environmental, labor, and safety standards, not outsourced to foreign producers beyond the reach of state law.