Gov. Rendell announces next step in mid-Atlantic agreement on low carbon fuel standard

HARRISBURG, USA: Governor Edward G. Rendell has signed a memorandum of understanding with 10 Northeast and Mid-Atlantic states committing to a regional effort to develop a comprehensive, regional low carbon fuel standard to reduce greenhouse gas emissions from transportation fuels.

"This regional effort marks the next step in Pennsylvania's remarkable transition to a green energy economy," Governor Rendell said. "Low carbon fuels are being manufactured right here in Pennsylvania, creating jobs and easing our dangerous reliance on foreign oil. Pennsylvania's alternative energy initiatives already have put thousands of Pennsylvanians to work and attracted millions of dollars in private investment. As Pennsylvania works closely with our northeastern neighbors to develop a standard for the entire region, we can grow our economy at the same time we protect the planet."

A low carbon fuel standard is a market-based, technologically neutral policy to reduce the average lifecycle greenhouse gas emissions of a unit of useful energy. The lifecycle concept of the greenhouse gas "footprint" includes all possible causes of greenhouse gas emissions, direct (on-site, internal) and indirect (off-site, external, embodied, upstream, downstream).

Transportation fuels contribute about 30 percent of the greenhouse gas emissions in the Mid-Atlantic region.

Based on letters of intent signed a year ago, Pennsylvania and the other states have already begun preliminary work toward designing a low carbon fuel standard. The Memorandum of Understanding is the next step, establishing a process to develop a regional framework by 2011 and examine the economic impacts of a standard program.
Pennsylvania already is making strides in the production of lower-carbon fuels, the Governor said.

Starting in January, all diesel fuel sold in the state must contain at least 2 percent biodiesel, since in-state production capacity hit 40 million gallons a year at the end of 2008. Under a state law Governor Rendell signed in July 2008, as Pennsylvania capacity to produce biodiesel grows, the required percentage of biodiesel grows -- reducing greenhouse gas emissions and creating jobs in the biofuels industry.

Over the next decade, Pennsylvania will replace 900 million gallons of transportation fuel with locally produced alternative resources such as ethanol and biodiesel, or with fuels derived from coal liquefaction.

Pennsylvania also is well-positioned to create jobs and expand the economy by providing other low-carbon transportation fuels such as compressed natural gas and electricity.

The Governor's signature on the memorandum coincides with his receipt of the Climate Change Advisory Committee's Action Plan, which contains 52 recommendations that could slash Pennsylvania's greenhouse gas emissions 36 percent while adding 65,000 new jobs and more than $6 billion to the economy by 2020. The Climate Change Advisory Committee, created by Act 70 of 2008, is a consortium of government, industry and environmental representatives.

These initiatives build on Pennsylvania's leadership in developing renewable energy technologies that reduce pollution, protect the quality of our air and waters, enhance our economy and strengthen national security. Among Pennsylvania's accomplishments:

* Pennsylvania's alternative energy portfolio standards are among the nation's most progressive, ensuring that 18 percent of all energy generated by 2020 comes from clean, efficient and advanced resources.

* The $650 million Alternative Energy Investment Fund and the nearly $16 million Alternative Fuels Investment are spurring the development of alternative and renewable energy sources and helping families and small businesses conserve energy and use it more efficiently.

* Pennsylvania is home to the East Coast's first state-of-the-art biofuels injection facility, which opened in 2005 with a $219,908 state investment. The plant replaces millions of gallons of foreign oil with domestically produced biodiesel and keeps energy dollars here at home by reducing the state's need to purchase imported fuels.

* Resurrected in 2004 after nearly a decade of inactivity, the Pennsylvania Energy Development Authority in its first four years awarded more than $40 million in 203 grants and loans for clean energy projects that will leverage an estimated $126 million in private investment and create thousands of jobs.

* The Pennsylvania Energy Harvest Grant Program has awarded nearly $29 million and leveraged more than $190 million in private funds since its inception in May 2003 for more than 100 projects using sources such as wind, solar, biomass, waste coal and recycled energy.

After the regional low carbon fuel standard is developed, governors from the participating states will have the opportunity to consider implementation.

In addition to Pennsylvania, the other states included in the agreement are Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Rhode Island and Vermont.