Green Wombat

In a big boost for hybrid cars and ethanol producers, California Governor Arnold Schwarzenegger today signed an executive order implementing the state’s landmark Low Carbon Fuel Standard to cut greenhouse gases produced by cars and other vehicles.  The order mandates that transportation fuel sold in California must be 10 percent less carbon intensive by 2020. That means oil companies like Chevron (CVX) and Exxon Mobil (XOM) must lower the carbon content of the fuel they sell in the Golden State by blending ethanol, improving their production processes or buying emission credits from utilities like Pacific Gas & Electric (PCG) and others that supply cleaner electricity or biofuels to power vehicles. PG&E has been an enthusiastic backer of the fuel standard and efforts to develop plug-in hybrid cars. The executive order directs the California Public Utility Commission to consider ways the state’s utilities can help fight global warming by reducing greenhouse gases from vehicles. In his executive order, Schwarzenegger noted that California’s 24 million registered cars consumed 16 billion gallons of gasoline in 2005 – exceeding the fuel consumption of Japan, which has four times the population. Only 1.3 percent of California cars are hybrids or flex-fuel vehicles – a number the new fuel standard aims to increase. "Right now, entrepreneurs from around the world are investing billions of dollars in clean technologies and alternative fuels. With this initiative, we are saying invest in California," said Schwarzenegger, surrounded by alt fuel cars at a signing ceremony at the Capitol. The order directs state environmental agencies to propose draft fuel standard regulations by June 30 but some old-line industrial heavy-hitters already are rushing to embrace the governor’s green dream. PG&E, not surprisingly, issued a statement today in support of the low carbon fuel standard, but so did East Coast chemicals giant DuPont (DD), which is developing biofuels. "We commend Gov. Schwarzenegger and his administration for taking steps to cost effectively reduce greenhouse gas emissions from transportation fuels and reduce the global dependence on fossil fuels," said Thomas M. Connelly, DuPont’s chief innovation officer.