I have my eye on California. They are leading the way in “green” policies; yet they make it difficult for companies with “green” products to get permits. They are also in the middle of a new Governors campaign and I can’t help but wonder if a new Governor will undo or improve any of the state’s current policies. One in particular that I’m watching is the Low Carbon Fuel Standard (CARB) which is currently under fire by the petroleum industry, trucking industry and corn ethanol industry. Each of these groups has filed a lawsuit against the California Air Resources Board (ARB) over various pieces of the policy.

One organization not filing suit is the Brazilian Sugarcane Industry Association (UNICA). To date, sugarcane ethanol has received the lowest carbon life-cycle rating of all forms of ethanol and seems to have become the ethanol darling among politicians. Recently, President Obama, who is afraid to utter the word “corn” in conjunction with ethanol, touted the benefits of sugarcane ethanol.

UNICA has repeatedly called for these organizations to drop their lawsuits against ARB. In this light, I spoke with Joel Velsco, the Chief Representative of North America for UNICA, and asked him to weigh in on what is happening in California. In terms of the LCFS, he said that they were hoping for a different decision from Judge O’Neil but it wasn’t a surprise – meaning after a review, the lawsuits have not been thrown out.

“California’s LCFS can help break our dependence on fossil fuels, protect us from market price volatility and provide consumers with cleaner and more abundant fuel choices,” said Velsco. “As UNICA outlined in our May Amicus brief, the LCFS is valid and consistent with the Constitution’s Commerce Clause, and is not preempted under the Supremacy Clause since it is entirely consistent with Congress’s own program mandating the use of renewable fuels. We will be closely observing this issue as it moves through the courts, and remain hopeful that the Judge will ultimately agree with the arguments we brought forth in our Amicus.”

As the suits make their way through California courts, I asked Velsco if he felt a new Governor at the helm could have any bearing on the future of the LCFS.

He responded, “I’ll leave the political analysis and predictions to the experts. What I can tell you is that after exhaustive study, California state officials have identified sugarcane ethanol as an important part of the solution to achieving the state’s low-carbon goals. The state has a right to lower the carbon footprint of transportation fuels used by Californians, and the biofuels industry is prepared to help the state meet this challenge.”

He continued, “Of course this would be easier to achieve if the LCFS wasn’t challenged in the courts, and the U.S. Congress lets the 54-cents-per-gallon tariff on imported ethanol expire at the end of this year. Regardless of who Californians elect as their next governor, they should seriously consider these issues and their overall energy security when casting their ballots in November.”

The ethanol tariff is currently under fire and set to expire at the end of the year. The corn ethanol industry is fighting to keep the tariff in place claiming that if the tariff is removed, America will be subsidizing foreign ethanol. However, UNICA maintains that removing the tariff will encourage competition and benefit consumers.

“At first, change and competition can be daunting,” explained Velsco. “It can be easier sometimes to accept the status-quo. But the status-quo is costing taxpayers $6 billion each year and hurting consumers at the pump with volatile gas prices. It’s time for Congress to remove a 30 year-old band-aid on a healthy and thriving industry.”

“Expanding the market for clean, renewable fuels in a way that benefits consumers is the smart and responsible thing to do. Earlier this year, Brazil took an important step by eliminating its own tariff on imported ethanol through the end of 2011. UNICA is urging the Brazilian government to make the tariff elimination permanent if Congress will do the same and drop the U.S. tax on imported ethanol,” concluded Velsco.

While the fate of the LCFS and the ethanol are uncertain, it is assured that the debate on what is in the best interest of the ethanol industry, the country and consumers will continue.