Hawaii lawmakers on Tuesday advanced legislation to create a low-carbon fuel standard (LCFS) for the state.
The state Senate and the House of Representatives each passed proposals to require a 10pc reduction in the carbon intensity of road fuels by 2035 and a 50pc reduction by 2045, both relative to a 2019 baseline. The bills moved forward with little or no opposition. The Senate version, SB 2999, how heads to the House, while the House companion bill, HB 1986, heads over to the Senate.
The legislation would require the Hawaii Department of Transportation to adopt rules for a Clean Fuel Standard (CFS) by 1 January 2028 and begin enforcement a year later.
LCFS programs require yearly reductions in the carbon intensity of road fuels such as gasoline and diesel. Fuels that exceed the annual limits incur deficits that suppliers must offset with credits generated from the distribution of approved, lower-carbon alternatives, such as renewable diesel or electricity to charge vehicles.
If the legislation becomes law, Hawaii would follow similar but distinct programs in California, Oregon, Washington and the soon-to-launch New Mexico credit market, as well as programs administered by the British Columbia provincial government and the Canadian federal government.
The Hawaii CFS would share many of the same characteristics as the other programs, such as allowing sustainable aviation fuel producers to opt in to the program to generate compliance credits. But it would not regulate the carbon intensity of aviation fuel.
The legislation also would allow regulators to link with other similar LCFS programs and to allow credit generation for displacing other non-regulated fuel uses, such as off-road, heating, cooling and temporary power generation.
The main difference between the two bills is the House version would require the Department of Transportation to report to the legislature every two years on the status of the program, market activity and other issues and to provide, if needed, recommendations for changes to the law. The Senate companion does not currently include such language.
LCFS legislation in Hawaii failed in the final hours of the 2025 session. House and Senate lawmakers ran out of time to resolve differences on issues such as the start date and a feasibility study on low-carbon fuel supply.
