On July 31, CARB posted the first quarter 2023 data for the LCFS program. In today’s flash report, we offer a quick look at the first quarter data. Our comprehensive analysis will be published in Stillwater’s Quarterly LCFS Newsletter which will be available to subscribers on Thursday, August 17th.
The first quarter data show a net credit of 1,340,472 metric tons (MT), down slightly from the fourth quarter net credit of 1,654,603. With the 1Q2023 net credit, the credit bank now stands at a record 16.5 million MT.
The table below summarizes the first quarter by fuel and compares it to the previous quarter (4Q2022) and to the same quarter last year (1Q2022).
A quick look at these data shows a few trends of interest. The major factors contributing to the decrease in net credit in the first quarter compared to the fourth quarter of last year were: decreases in net credits for all fuel types except for alternative jet fuel and renewable naphtha. RNG and on-road electricity net credits both decreased from 4Q2022 to 1Q2023. Compared to the fourth quarter of 2022, 1Q2023 showed a 12.2% decrease in RNG credits on a 1.1% volume increase, and a 7.8% decrease in on-road electricity credits on a 6% volume decrease. Net credits for ethanol decreased by 8.8 % on a 1.8% volume decrease. BD showed an increase in average CI, and a volume decrease of 3% compared to 4Q2022. Net credits for alternative jet fuel increased 161% on a 191.9% volume increase. Net credits for RD decreased by 0.9% on higher volume but a 3.41 gCO2e/MJ increase in average RD carbon intensity.
Although the total net credit for the first quarter was down from the prior quarter, it marked a 0.7 million MT increase compared to a year earlier (1Q2022). Together, RNG, on-road electricity, and renewable diesel played the biggest roles in the year-on-year increase in net credits.
We will provide an in-depth analysis of this data in our upcoming quarterly newsletter, to be published on August 17, 2023. Access to Stillwater’s LCFS Newsletter is only available to subscribers. For more detailed information on LCFS data trends and analysis, be sure to subscribe!
What does this quarterly data mean for Credit Prices?
Stillwater offers a full suite of credit price outlooks offering our view of the California Low Carbon Fuel Standard (LCFS), Oregon Clean Fuels Program (CFP), British Columbia LCFS (BC-LCFS) and U.S. Renewable Fuel Standard (RFS) markets through 2035. Last week we also published our inaugural lipid feedstock outlook. These outlooks are offered through our consulting practice, and each outlook comes with a one-hour, one-on-one Q&A session with our senior subject matter experts!
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