State moves to adopt clean transportation fuels program, aiming to cut emissions

The state Environmental Improvement Board voted Thursday to adopt regulations for a program aimed at increasing the use of lower-carbon transportation fuels, a move that has drawn sharp criticism from opponents and praise from environmental advocates.

The establishment of the Clean Transportation Fuel Program, which will go into effect in April, follows the signing of legislation by Gov. Michelle Lujan Grisham in 2024 that created a pathway for its framework.

“That is a bipartisan vote,” said Michelle Miano, Environmental Protection Division director for the New Mexico Environment Department. “We are really seeing recognition that this is a good program, an effective program, and a program that makes fuels more affordable — no matter what political party that you’re from.”

Miano, who called the program “unique” in the environmental regulatory space, said it will create a marketplace for — and expand access to — transportation fuels like ethanol, renewable diesel, renewable natural gas and electricity. New Mexico will become the fourth state to adopt this type of program, joining Washington, Oregon and California. 

The program will see NMED catalog both low-carbon and high-carbon fuels coming into or being produced in New Mexico for sale, assigning credits and deficits depending on the substance’s carbon value, Miano said. 

NMED will set a carbon- intensity standard for these fuels — at year’s end, they must meet a 1.8% reduction from the 2018 baseline standard for gasoline and diesel — which will increase annually. Miano said fuels below that standard will gain credits in the market, while those above will have deficits.

“By this program being in effect, these are the kinds of fuel options that New Mexicans can expect to see,” Miano said. “No longer will they have just one option at the pump. They’ll have different options and also cheaper options, we anticipate.”

NMED on Thursday said the program, once implemented, would not only reduce health care costs but also create 800 jobs and deliver $1.65 billion in net benefits for residents “through avoided air quality health impacts and climate change infrastructure damages.”

Since 2024, an advisory committee — made up of representatives from oil and gas industries and environmental groups — held several meetings regarding how the program would work, Miano said. 

Miano added that the department also worked closely with states that had similar programs in place to better understand their processes and regulatory structures. 

“We really learned a lot from them because we didn’t want to make some of the same mistakes that they had made in the past,” Miano said. “They really advised us on how to make sure that we have a healthy market.”

A December 2025 report from NMED shows that transportation produced the second-most greenhouse gas emissions behind industry, of which the oil and gas sector is the largest contributor.

Camilla Feibelman, Sierra Club Rio Grande Chapter director, said New Mexico is facing some of the “most stark consequences of climate change.” With transportation being one of the leading producers of pollution, she said the program could boost the electrification of public transport systems and the installation of chargers. 

“That’s all important because electricity is cheaper than gas and it’s cleaner than gas,” Feibelman said. “It means that in our communities that are impacted by transportation pollution, we’re also cleaning up the air.”

The legislation that led to the program’s creation had also garnered some opposition from lawmakers two years ago, with some Republicans debating its potential impacts, such as an increase in fuel prices. 

On Monday, Republican Party of New Mexico Chair Amy Barela said the program will “skyrocket gas prices for struggling New Mexicans and turn our state into California, where many people cannot afford to live.”

“As fuel costs drop across the country, the economy is rebounding thanks to President Trump. New Mexicans finally have a real opportunity to get back on their feet, but unfortunately Governor Lujan Grisham would rather appease the radical left with the Clean Transportation Fuel program,” she said.

Hannah García covers tech and energy for the Journal. You can reach her at hgarcia@abqjournal.com.