New Mexico’s Clean Transportation Fuel Program marks major expansion of low-carbon fuel policy

Clean Fuels Alliance America applauded the New Mexico Environment Improvement Board for approving the rules for New Mexico’s Clean Transportation Fuel Program.  

This action marks a significant expansion of low-carbon fuel policy beyond the West Coast, demonstrating that a state that leads in energy production can also lead in meaningful decarbonization. 

Signed into law in March 2024, House Bill 41 made New Mexico the fourth state in the nation to adopt a low-carbon fuel standard.  

The policy requires providers of transportation fuels to reduce the average carbon intensity of fuels sold in the state by 20 percent by 2030 and 30 percent by 2040, compared to a 2018 baseline. 

“From a market perspective, New Mexico represents an almost 800-million-gallon opportunity for the biomass-based diesel industry,” said Cory-Ann Wind, the director of state regulatory affairs for Clean Fuels. “Since it sits along a key corridor for both feedstocks and finished fuels produced in the Gulf Coast and Midwest, New Mexico’s entry into the market not only expands the demand for clean fuels but further strengthens the supply chain.” 

New Mexico’s leadership is particularly significant given its role as the second-largest oil-producing state in the U.S. and the fourth-largest natural-gas producer. 

“As the first non-West-Coast state to implement a clean-fuel standard, New Mexico proves that states with strong energy economies can also lead on clean-fuel deployment and market certainty,” said Jeff Earl, director of state governmental affairs for Clean Fuels. “This program adds real momentum to clean-fuel standard adoption nationwide.” 

Clean Fuels served on the advisory committee that developed the program’s regulations, working in collaboration with the Low Carbon Fuels Coalition to pass the enabling legislation.  

Clean Fuels has long advocated for biobased diesel producers in New Mexico and looks forward to working with regulators and stakeholders to ensure a durable, science-based program that delivers environmental benefits while supporting fuel affordability, supply reliability and economic growth.