Companies extracting oil from Canadian tar sands could lose out under the LCFS unless they can improve the energy efficiency of the process by which they mine and refine asphalt-like bitumen into motor fuel. Some U.S. refiners argue that the LCFS will effectively ban the sale of tar-sands-based fuels in California. Sperling counters that it will drive the needed improvements. “I’ve talked to oil producers and they insist that tar sands can be produced competitively with a much smaller carbon footprint, if there were a stronger incentive to do so. LCFS provides that incentive,” he says.

Corn ethanol producers will be similarly challenged to improve because, under the LCFS regulations, the carbon footprint of this fuel looks to be about equal to or even worse than conventional gasoline’s. Corn ethanol looks about a third better than gasoline when you consider direct emissions attributable to growing corn and converting it to ethanol, but that advantage evaporates when you throw in the estimated greenhouse effect of indirect land use changes.

The Air Resources Board has yet to complete its analysis of cellulosic biofuels, which can be produced from agricultural wastes or woody crops grown on marginal lands, but the expectation is that such fuels will fare much better than corn ethanol. “If you use cellulosic and waste materials, then the land use effects are near zero, and the life-cycle greenhouse gas emissions are very low,” says Sperling.

These impacts would be much greater if the LCFS approach were extended beyond California. But the way the standard considers land use change has faced heavy opposition from the ethanol industry and farm-belt interests. Such resistance has stalled both federal and European initiatives of a similar nature.

The EPA is a year behind on a Congressional mandate to factor in life-cycle emissions, including indirect land use impacts, in updated rules for the federal Renewable Fuels Standard. The rules will define which fuels qualify as “advanced biofuels,” which account for about 7 percent of renewable fuels today and will account for 58 percent by 2022. These rules, originally due out last year, are expected to be finalized in 2010.

Sperling says he hopes that advanced biofuels developers, who have not played a large role in the debate so far, will recognize that their interests are in competition with those of the corn ethanol industry. “The food-based interests have been very clever and effective at muddying that distinction and bamboozling those advanced cellulosic interests that have a lot to gain from including land use effects in a full life-cycle analysis,” says Sperling.