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American Fuel & Petrochemical Manufacturers v. O'Keeffe

ELR Citation: 45 ELR 20186
Nos. 3:15-cv-00467, (D. Or., 09/23/2015) (Aiken, J.)

A district court upheld Oregon's clean fuels program, which seeks to reduce lifecycle emissions of greenhouse gases (GHG) from transportation fuels by 10% over a 10-year period. Trade associations argued that the program was unconstitutional because it discriminates against out-of-state commerce. But the program rewards all investment in innovative fuel production, irrespective of where that innovation occurs. The program distinguishes among fuels based on lifecycle GHG emissions, not origin or destination; both in-state and out-of-state products can earn lower carbon intensity values; and regulated parties are not required to import or manufacture any specific fuel in order to achieve compliance. Further, whatever effects the program may ultimately have on Oregon's biofuels market, there are no plausible allegations demonstrating that out-of-state producers will be commercially disadvantaged or considerably burdened. The court also rejected claims that the program is expressly preempted by CAA §211(c) and EPA's reformulated gasoline rule. Nor does the program conflict with the renewable fuel standard, the Energy Independence and Security Act, or the Energy Policy Action of 2005.