The low carbon fuel standard energizes California’s EV future

OPINION – California is recognized the world over for its innovative spirit. So, it’s no surprise our state is playing a critical role in transitioning to cleaner, better transportation options like electric vehicles (EVs). The growth in sales of EVs over the last decade has been remarkable. EVs now make up nearly a quarter of all vehicles sold in California. The state’s ambitions and openness to new technologies are just a couple of the reasons why Rivian decided to put its headquarters right here in Orange County.

The EV landscape has never been more competitive, with newcomers like us and traditional car manufacturers producing a wide range of EVs. Importantly, this competitive market also ensures that the best vehicles will succeed. As a company, we support robust competition because we stand behind the quality and innovation that goes into making our products.

And when it comes to fighting climate change, California can further harness the power of competition and private investment to achieve its decarbonization goals. By using market-based policies that ensure the best ideas succeed, we can also maximize impact by marshaling private capital to invest in climate solutions. Fortunately, California already has an excellent example of this kind of approach in the Low Carbon Fuel Standard (LCFS).

The LCFS has been a cornerstone of California’s climate strategy since its inception in 2011. Under the LCFS, clean fuels earn credits that producers of dirty fuels buy to achieve compliance with the standard. The resulting market multiplies the business opportunity for companies up and down the clean transportation value chain. In Rivian’s case, our Rivian Adventure Network fast chargers generate credits when they charge EVs on the road, while fleet owners earn credits when they charge our vans and trucks in their depots. Market-wide, electricity credits like these have already generated more than $1 billion in value to date—a powerful market signal and catalyst for growth in California’s EV sector.

Even more is possible. Policymakers have proposed changes to the LCFS that would incentivize the auto industry to go above and beyond its minimum EV sales requirements while enabling us to make larger investments in widely available charging infrastructure, multilingual marketing and education initiatives, or even purchase rebates——allowing everyone to enjoy the benefits of owning an EV. Other newly updated program rules, if finalized, would also support more early investments in public chargers, even in parts of the state where EVs are not yet common such as rural and underserved communities.  These are smart ideas, and Rivian is advocating for them to ensure that California realizes its EV goals as quickly as possible.

The key to making this work is setting the right targets for reducing the carbon intensity of fuels under the policy. That is what drives continued innovation and investment in clean fuel technologies—like EVs—that make compliance with the LCFS possible. Rivian strongly supports the recently proposed updates to the policy’s targets. The LCFS has been such a success that we are now ready to hit the accelerator.

As California works toward its climate goals, the LCFS is a critical tool to be sure we get there. In fact, the LCFS features prominently in the state’s climate Scoping Plan. It’s no wonder, given the policy’s many benefits for transportation electrification. The state’s EV goals mean that it has never been more important to ensure that the LCFS is strong and stable. Our state’s leaders should take this opportunity to make strategic updates to the policy, setting robust targets, preserving and improving program rules that support charging infrastructure, and finding new ways to use LCFS revenues to grow the EV market as quickly as we can.  Strengthening and improving the LCFS this year will ensure that it builds on this success in its next decade, setting yet another example of California’s leadership for the world. We strongly support this vital work and urge policymakers to act now.

Alan Hoffman is Chief Policy Officer for Rivian.