California has established ambitious clean fuels deployment targets, including a 1,700x increase in clean hydrogen for use in transport, industry and the power sector, 100% sustainable aviation fuel (SAF) as well as a near-total phase-down of petroleum refining – all by 2045.

There are multiple obstacles to deliver these targets. Clean hydrogen and SAF are roughly 3-5x more expensive than their fossil equivalents. There is also no transport and storage infrastructure to connect clean producers and end-users. There are also a number of sustainability risks, including that grid-connected electrolytic hydrogen could inadvertently increase fossil fuel use, and that biomass feedstocks for either hydrogen or SAF are derived from energy crop plantations which contribute to deforestation in the Global South. Finally there is not yet a credible phase-down strategy for oil refineries where workers could repurpose their skills as part of a transition to new employment of comparable pay and security.

We are currently focused on policies that would help buy-down the cost of clean hydrogen and SAF, including via new incentives under the state’s Low Carbon Fuel Standard program as well as a mandate that refineries procure an increasing amount of clean hydrogen. We are also focused on sustainability challenges, including limiting eligible biomass supply to waste resources only as well as developing a stringent but phased-in approach to the three pillars rules for grid-connected green hydrogen.

For more information, contact Amanda DeMarco (amanda@csgcalifornia.com) or Sam Uden (sam@csgcalifornia.com).