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Navy Expands Low Carbon Fuel Credits Agreement with Port of San Diego to Additional Two Local Bases

28 April 2023

From Brian O'Rourke, Navy Region Southwest

SAN DIEGO - The Navy has expanded a first-of-its-kind agreement with the Port of San Diego that gives the U.S. Navy access to participate in California's Low Carbon Fuel Standard (LCFS) market.

Under the groundbreaking 2022 joint Memorandum of Understanding, funds generated from the sale of LCFS credits are used to begin significant upgrades to the electrical infrastructure at Naval Base San Diego and the Port of San Diego. Since the signing of that agreement, $4.5 million has been generated from the sale of LCFS credits. The new agreement between the Navy and the Port, signed Wednesday, April 26, 2023, allows the Navy to generate credits at two additional bases, Naval Base Coronado and Naval Base Point Loma.

"Our collaboration with the Port of San Diego has already proven very successful, providing the Navy with a unique opportunity to upgrade our electrical infrastructure," said Rear Adm. Brad Rosen, Commander, Navy Region Southwest. "Expanding this agreement to include two more of our local Navy installations strengthens the Navy's mission readiness and energy resilience, and helps reduce greenhouse gas emissions and improve air quality around San Diego Bay. This is a win for the Navy, the Port, and the people of San Diego."

"Once again, San Diego is leading the way in innovative strategies to improve air quality and public health. We couldn't be more thrilled to help facilitate the Navy's expansion of this program as it means more money for and earlier deployment of clean air projects for our region. It's a big win for our agencies and an even bigger win for our neighbors in the communities of Barrio Logan, Logan Heights, Sherman Heights, and National City," said Chairman Rafael Castellanos, Port of San Diego Board of Port Commissioners.

The Navy's participation in this program is the first ever participation by the Department of Defense in this type of carbon reduction effort. The Navy generates LCFS credits while ships are plugged into shore power, rather than generating power internally using traditional, carbon-intensive fuels, and limiting emissions of greenhouse gasses in the surrounding community. Connecting ships to shore power while in port directly aligns with two Presidential Executive Orders requiring all federal agencies to take steps to reduce carbon emissions and support clean energy activities.

The LCFS is a cap-and-trade-like program where the producers of fossil fuels must either increase the use of plant-based carbon (e.g., ethanol and soybean oil) or buy credits to meet the requirement. The Navy generates credits via its current use of shore power for its fleet. One LCFS credit generated is equivalent to one metric ton of carbon dioxide reduced. Creation of credits can be achieved utilizing alternative low carbon fuels or electrification.

For more information on the Navy's energy conservation efforts, contact:
Brian O'Rourke,
Navy Region Southwest
(619) 985-3725


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