IDEAS home Printed from https://ideas.repec.org/a/wly/sustdv/v34y2026i2p2672-2696.html

From Costs to Reductions in Carbon Intensity: Market Signals and Electric Vehicle Charging Infrastructure in Oregon's Clean Fuels Program for Sustainable Development

Author

Listed:
  • Chukwuemeka Valentine Okolo
  • Andres Susaeta
  • Mindy Crandall
  • John Sessions

Abstract

This study examines the long‐run determinants of ethanol carbon intensity (CI) under Oregon's Clean Fuels Program (CFP). The study emphasizes how biofuel costs, credit market dynamics, and electric vehicle (EV) infrastructure interact to shape low‐carbon transitions. Using monthly data from 2018 to 2024, we apply a set of econometric techniques, including fully modified ordinary least squares (FMOLS), instrumental variables (IV‐2SLS), dynamic OLS with robust and quantile estimators, bootstrap simulations, and nonlinear specifications, to ensure rigorous and reliable inference. The results reveal three central findings. First, average credit prices are consistently linked to reductions in ethanol CI. This confirms the fundamental role of market‐based incentives in driving decarbonization. However, this relationship is nonlinear: Compliance responses strengthen with moderate credit increases but taper at higher price levels. Second, biodiesel (B5) and ethanol (E10) costs are associated with lower ethanol CI. This reflects the CFP's performance‐based structure, where rising costs coincide with stronger credit generation and cleaner fuel blending. Third, the expansion of EV infrastructures, such as DC fast‐charging infrastructure, supports additional CI reductions, though with diminishing marginal gains as network density increases. Interaction analysis further shows that credit prices are most effective in areas with more developed EV infrastructure. This underscores the combined effect between market signals and technological deployment. Therefore, the research findings demonstrate that Oregon's CFP effectively integrates economic incentives and infrastructure investment to advance sustainable, low‐carbon transportation fuel transitions.

Suggested Citation

  • Chukwuemeka Valentine Okolo & Andres Susaeta & Mindy Crandall & John Sessions, 2026. "From Costs to Reductions in Carbon Intensity: Market Signals and Electric Vehicle Charging Infrastructure in Oregon's Clean Fuels Program for Sustainable Development," Sustainable Development, John Wiley & Sons, Ltd., vol. 34(2), pages 2672-2696, April.
    • Handle: RePEc:wly:sustdv:v:34:y:2026:i:2:p:2672-2696
    DOI: 10.1002/sd.70472
    as

    Download full text from publisher

    File URL: https://doi.org/10.1002/sd.70472
    Download Restriction: no
    File URL: https://libkey.io/10.1002/sd.70472?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Lund, Henrik & Skov, Iva Ridjan & Thellufsen, Jakob Zinck & Sorknæs, Peter & Korberg, Andrei David & Chang, Miguel & Mathiesen, Brian Vad & Kany, Mikkel Strunge, 2022. "The role of sustainable bioenergy in a fully decarbonised society," Renewable Energy, Elsevier, vol. 196(C), pages 195-203.
    2. Daniel Scheitrum, 2020. "Impact of Intensity Standards on Alternative Fuel Adoption: Renewable Natural Gas and California’s Low Carbon Fuel Standard," The Energy Journal, , vol. 41(2), pages 191-217, March.
    3. Danish I. Godil & Zhang Yu & Arshian Sharif & Rimsha Usman & Syed Abdul Rehman Khan, 2021. "Investigate the role of technology innovation and renewable energy in reducing transport sector CO2 emission in China: A path toward sustainable development," Sustainable Development, John Wiley & Sons, Ltd., vol. 29(4), pages 694-707, July.
    4. Sovacool, Benjamin K., 2011. "The policy challenges of tradable credits: A critical review of eight markets," Energy Policy, Elsevier, vol. 39(2), pages 575-585, February.
    5. Mallick, Hrushikesh & Padhan, Hemachandra & Mahalik, Mantu Kumar, 2019. "Does skewed pattern of income distribution matter for the environmental quality? Evidence from selected BRICS economies with an application of Quantile-on-Quantile regression (QQR) approach," Energy Policy, Elsevier, vol. 129(C), pages 120-131.
    6. Giuseppina Siciliano & Linda Wallbott & Frauke Urban & Anh Nguyen Dang & Markus Lederer, 2021. "Low‐carbon energy, sustainable development, and justice: Towards a just energy transition for the society and the environment," Sustainable Development, John Wiley & Sons, Ltd., vol. 29(6), pages 1049-1061, November.
    7. Shi Wang, 2025. "Green Credit, Digital Economy and Enterprise Pollution Reduction," Sustainability, MDPI, vol. 17(9), pages 1-24, April.
    8. Ziyue Wang & Juan Zhang & Huiju Zhao, 2020. "The Selection of Green Technology Innovations under Dual-Credit Policy," Sustainability, MDPI, vol. 12(16), pages 1-22, August.
    9. Millinger, M. & Reichenberg, L. & Hedenus, F. & Berndes, G. & Zeyen, E. & Brown, T., 2022. "Are biofuel mandates cost-effective? - An analysis of transport fuels and biomass usage to achieve emissions targets in the European energy system," Applied Energy, Elsevier, vol. 326(C).
    10. Shobande, Olatunji A. & Ogbeifun, Lawrence & Tiwari, Aviral Kumar, 2024. "Extricating the impacts of emissions trading system and energy transition on carbon intensity," Applied Energy, Elsevier, vol. 357(C).
    11. Breetz, Hanna L., 2017. "Regulating carbon emissions from indirect land use change (ILUC): U.S. and California case studies," Environmental Science & Policy, Elsevier, vol. 77(C), pages 25-31.
    12. Okolo, Chukwuemeka Valentine & Susaeta, Andres & Sessions, John, 2026. "Credit market dynamics, reduced greenhouse gas, and carbon intensity targets: Insights from the Oregon clean fuels program for sustainable development," Renewable Energy, Elsevier, vol. 256(PG).
    13. Mandegari, Mohsen & Ebadian, Mahmood & Saddler, Jack (John), 2023. "The need for effective life cycle assessment (LCA) to enhance the effectiveness of policies such as low carbon fuel standards (LCFS's)," Energy Policy, Elsevier, vol. 181(C).
    14. Tushar Gahlaut & Gourav Dwivedi & Ashish Dwivedi, 2024. "Analyzing the blockades to electric vehicle mobility in an emerging economy: Toward a triple bottom line sustainable development," Sustainable Development, John Wiley & Sons, Ltd., vol. 32(1), pages 902-916, February.
    15. Witcover, Julie & Murphy, Colin W, 2019. "Status Review of Oregon’s Clean Fuels Program, 2016–2018 Q3 (Revised Version)," Institute of Transportation Studies, Working Paper Series qt0ct4m7gs, Institute of Transportation Studies, UC Davis.
    16. repec:aen:journl:ej41-2-scheitrum is not listed on IDEAS
    17. Scott, William A., 2025. "Cost and carbon-intensity reducing innovation in biofuels for road transportation," Energy Policy, Elsevier, vol. 197(C).
    18. Cabrera-Jiménez, Richard & Mateo-Sanz, Josep M. & Gavaldà, Jordi & Jiménez, Laureano & Pozo, Carlos, 2022. "Comparing biofuels through the lens of sustainability: A data envelopment analysis approach," Applied Energy, Elsevier, vol. 307(C).
    19. Sun, Jie & Sun, Siying & Chen, Boli & Hu, Yukun, 2024. "Charging change: Analysing the UK's electric vehicle infrastructure policies and market dynamics," Energy Policy, Elsevier, vol. 191(C).
    20. Rubin, Jonathan & Leiby, Paul N., 2013. "Tradable credits system design and cost savings for a national low carbon fuel standard for road transport," Energy Policy, Elsevier, vol. 56(C), pages 16-28.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Mukut Sikder & Jianqiang Fan & Frederick Kwame Yeboah & Paruss Panhwar, 2026. "Does green logistics mitigate CO2 emissions from transportation in developing countries?," Economic Change and Restructuring, Springer, vol. 59(4), pages 1-24, August.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Scott, William A., 2025. "Cost and carbon-intensity reducing innovation in biofuels for road transportation," Energy Policy, Elsevier, vol. 197(C).
    2. Ostadzad, Ali Hossein, 2022. "Innovation and carbon emissions: Fixed-effects panel threshold model estimation for renewable energy," Renewable Energy, Elsevier, vol. 198(C), pages 602-617.
    3. Filippelli, Raphael & Termansen, Mette & Hasan, Syezlin & Hasler, Berit & Hansen, Line & Smart, James C.R., 2022. "Water quality trading markets – Integrating land and marine based measures under a smart market approach," Ecological Economics, Elsevier, vol. 200(C).
    4. Xinpeng Gao & Sufeng Li, 2025. "A Dynamic Evolution and Spatiotemporal Convergence Analysis of the Coordinated Development Between New Quality Productive Forces and China’s Carbon Total Factor Productivity," Sustainability, MDPI, vol. 17(7), pages 1-28, April.
    5. Wen, Chen & Xing, Yuhang & Wang, Tao & Liao, Sheng & Gao, Ke, 2025. "How do green supply chain management and renewable energy consumption influence carbon emissions in China and India? A comparative analysis," Energy Economics, Elsevier, vol. 143(C).
    6. Zhenxiang Cao & Liqing Peng, 2023. "The Impact of Digital Economics on Environmental Quality: A System Dynamics Approach," SAGE Open, , vol. 13(4), pages 21582440231, December.
    7. Idiano D'Adamo & Massimo Gastaldi & Ilhan Ozturk, 2023. "The sustainable development of mobility in the green transition: Renewable energy, local industrial chain, and battery recycling," Sustainable Development, John Wiley & Sons, Ltd., vol. 31(2), pages 840-852, April.
    8. Dogterom, Nico & Ettema, Dick & Dijst, Martin, 2018. "Behavioural effects of a tradable driving credit scheme: Results of an online stated adaptation experiment in the Netherlands," Transportation Research Part A: Policy and Practice, Elsevier, vol. 107(C), pages 52-64.
    9. Viglioni, Marco Túlio Dinali & Calegario, Cristina Lelis Leal & Bruhn, Nádia Campos Pereira, 2025. "Effects of economic complexity and metallic mineral resources on renewable energy transition in developing countries," Resources Policy, Elsevier, vol. 102(C).
    10. Scheitrum, Daniel, 2017. "Renewable Natural Gas as a Solution to Climate Goals: Response to California's Low Carbon Fuel Standard," MPRA Paper 77193, University Library of Munich, Germany.
    11. Kiehbadroudinezhad, Mohammadali & Hosseinzadeh-Bandbafha, Homa & Pan, Junting & Peng, Wanxi & Wang, Yajing & Aghbashlo, Mortaza & Tabatabaei, Meisam, 2023. "The potential of aquatic weed as a resource for sustainable bioenergy sources and bioproducts production," Energy, Elsevier, vol. 278(PA).
    12. Wei, Shuxin & Wei, Wenshan & Umut, Alican, 2023. "Do renewable energy consumption, technological innovation, and international integration enhance environmental sustainability in Brazil?," Renewable Energy, Elsevier, vol. 202(C), pages 172-183.
    13. Zhang, Bo & Zhang, Chuan & Song, Xuehang & Liu, Shuang & Duan, Yu & Nie, Hongdi & Luo, Wenbo & Wei, Wei & Sun, Nannan, 2026. "Methanol production technology development pathways under multi-agent stochastic evolutionary game: a complex network perspective," Energy, Elsevier, vol. 346(C).
    14. Fingerman, Kevin & Geronimo, Carisse & Read, Emily & Wakeman, Donovan & Martin, Jeremy I., 2025. "Risks of crediting carbon offsets in low carbon fuel standards: lessons learned from dairy biomethane," Energy Policy, Elsevier, vol. 206(C).
    15. Ugur Korkut Pata & Sinan Erdogan & Selin Karlilar Pata & Mustafa Tevfik Kartal, 2026. "Nonlinear impacts of environmental transport taxes and biofuel consumption on greenhouse emissions in the four largest European Union countries," Natural Resources Forum, Blackwell Publishing, vol. 50(1), pages 157-183, February.
    16. Olawale Ogunrinde & Ekundayo Shittu, 2023. "Benchmarking performance of photovoltaic power plants in multiple periods," Environment Systems and Decisions, Springer, vol. 43(3), pages 489-503, September.
    17. Black, Geoffrey & Holley, Donald & Solan, David & Bergloff, Michael, 2014. "Fiscal and economic impacts of state incentives for wind energy development in the Western United States," Renewable and Sustainable Energy Reviews, Elsevier, vol. 34(C), pages 136-144.
    18. Li, Y.P. & Huang, G.H. & Li, M.W., 2014. "An integrated optimization modeling approach for planning emission trading and clean-energy development under uncertainty," Renewable Energy, Elsevier, vol. 62(C), pages 31-46.
    19. Lund, H. & Østergaard, P.A. & Yuan, M. & Sorknæs, P. & Thellufsen, J.Z., 2025. "Energy balancing and storage in climate-neutral smart energy systems," Renewable and Sustainable Energy Reviews, Elsevier, vol. 209(C).
    20. Qiu, Zhaoxuan & Li, Jincheng & Liu, Bei & Jin, Meilin & Wang, Jinmin, 2025. "How does energy quota trading affect the corporate pollution gap? Evidence from China," Economic Modelling, Elsevier, vol. 146(C).

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wly:sustdv:v:34:y:2026:i:2:p:2672-2696. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://onlinelibrary.wiley.com/journal/10.1002/(ISSN)1099-1719 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.