cCarbon’s 2035 California LCFS Market Outlook

The analyst note addresses California’s Low Carbon Fuel Standard market dynamics following the Office of Administrative Law’s June 27 approval of CARB’s amended LCFS regulation. The analysis explores the regulatory implementation timeline, which saw the stricter carbon intensity benchmarks take effect in July 2025, applying to fuel transactions and supply volumes from Q3 2025 forward. This delayed implementation introduced significant market volatility and regulatory uncertainty throughout the first half of 2025. The note presents

• cCarbon’s 2035 credit, deficit, bank and credit price forecasts using the CFS.CarbonOutlook model
• Three critical market scenarios
• The framework evaluates the evolving credit bank dynamics, building upon baseline projections established in December 2024, when the credit surplus exceeded 37 million metric tons
• Supply-demand equilibrium projections through 2035

cCarbon hosted a webinar exploring these forecasts. You can find the webinar recording here.