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Said CARB Chairman Mary Nichols after the vote, “The new standard means we can begin to break our century-old dependence on petroleum and provide California with greater energy security.”

The passage of the Low Carbon Fuel Standard is being touted by CARB as good not only for the environment, but for California’s economy as well. Said Nichols, “(This) will be a boon to the state's economy and public health — it reduces air pollution, creates new jobs and continues California's leadership in the fight against global warming.” CARB projects that 25+ new biofuel facilities will be required to produce the estimated 1.5 billion gallons of biofuel needed, and will create 3,000+ new California jobs, mostly in the state’s rural regions.

California is joining private sector and federal investment to provide funding for projects developing and deploying low carbon fuels. For example, the California Energy Commission’s Alternative and Renewable Fuel and Vehicle Technology Program, will provide some $120 million dollars per year over seven years to deploy the cleanest fuels and vehicles. California investors and developers of alternative fuels are poised to benefit greatly according to Bob Epstein, co-founder of Environmental Entrepreneurs, whose 500-member California business organization supported the new standard. Transportation fuel is “a multibillion-dollar market in California that is currently exclusively owned by the oil companies, and they're going to lose their exclusive franchise,” said Epstein.

The “new low-carb” fuel standard could impact the Obama Administration’s ever evolving plan regarding the overall transportation industry. Said Nichols, “By changing the way we think about fuels and requiring them all to be lower carbon, I think we are now finally creating an opportunity for other types of advanced transportation to compete on a level playing field.”

Obviously, not everyone is pleased with the regulation’s passage. Businesses and oil industry critics warn that research is incomplete and that the Board’s adoption of the new standard could lead to higher costs borne by consumers in an already troubling economy. Bob Dinneen, President and CEO of the Renewable Fuels Association expressed disappointment and found the Board's decision premature, but said he “remains confident that the formation of the expert work group will result in a more balanced and fair assessment of the indirect greenhouse gas effects of all fuels.” According to RFA, “Adopting this standard sets a dangerous precedent about the application of unproven science to industries across the country. This standard is based on flawed analysis and selectively enforced penalties against biofuels only. In unfairly penalizing ethanol, ARB is relegating California to more petroleum use as biofuels are the only viable alternative liquid fuel.”

Catherine Reheis-Boyd, executive director of the Western States Petroleum Association lobbying group, which did not support the new regulation, argues that currently there are not enough biofuels available to meet the demands of the new regulation. In this regard, petroleum producers did get one major concession: they will be permitted to gradually reduce the carbon content of their fuels over several years to reach the 10-percent reduction.