California dairy biogas credits: why the carbon math fails

California’s Low Carbon Fuel Standard pays cattle farmers across the country to capture methane from manure and convert it into pipeline natural gas, a subsidy system regulators extended in 2024 beyond 2050. Researchers say the program reduces near-term warming but permits extra carbon dioxide that will persist for centuries, producing more long-term warming than the policy’s accounting recognizes.

How does California’s dairy biogas program work?

The program pays dairies to install anaerobic digesters that capture biogas from manure, convert it into natural gas, and inject it into pipelines for vehicles or power plants; petroleum companies then buy Low Carbon Fuel Standard credits instead of cutting their own fuel emissions. Dairies typically spray manure into open lagoons where microbes produce methane; redirecting that sludge into covered digesters captures the biogas, which is turned into pipeline gas. The credits let refiners meet regulatory targets in lieu of directly reducing petroleum-based emissions.

The subsidy has become widely used because the payouts are lucrative. Captured biogas still produces carbon dioxide when burned, but the program’s logic is that preventing methane releases avoids a stronger short-term greenhouse effect and reduces demand for extracted natural gas.

Where does the carbon math go wrong?

California assumes methane exerts about 25 times the warming effect of carbon dioxide over a 100-year period, but methane is short-lived while carbon dioxide accumulates for centuries to millennia, so swapping methane for CO2 increases long-term warming. Methane typically breaks down within a couple of decades, whereas much of emitted CO2 will continue heating the planet for hundreds to thousands of years. That means preventing a pulse of methane now does not fully compensate for the extra CO2 released when biogas replaces other fuels over the long term.

The mismatch shows up in the program’s crediting. As UC Berkeley economist Aaron Smith summarized, “adding one average biogas-powered vehicle to the fleet would produce enough LCFS credits to cover the deficits incurred by 26 similar gasoline-powered vehicles.” The math treats avoided methane as a long-term climate benefit comparable to avoiding CO2, even though their atmospheric futures are very different. Digesters do reduce methane emissions, though the program’s effectiveness varies and capture is not always as complete as hoped.

Regulators have leaned into the approach despite critiques. In 2024 California decided to extend parts of the program beyond 2050, and a recent proposal from the state’s air resources board could send millions of additional dollars to dairy farmers while easing restrictions on major greenhouse-gas producers.

Why it matters

The program reveals a broader policy flaw: crediting and offsets can move emissions around in time and space without actually cutting the planet’s long-term carbon burden. By allowing one sector to buy its way out of fuel decarbonization through payments to another, the system risks locking in permanent CO2 increases while only curbing short-lived methane. Policymakers aiming to keep global temperatures in check over the coming century must account for gas lifetimes, not just avoid near-term warming spikes.

If climate policy prioritizes short-term reductions over cumulative greenhouse-gas budgets, it shifts the burden of long-lived heating onto future generations. The dairy digester case is a concrete example where accounting choices have real climatic consequences.

What to watch

Monitor the state’s air resources board deliberations on the recent proposal, including any votes to authorize additional payments to dairies or to relax requirements for large greenhouse-gas emitters. Those decisions will show whether California adjusts the program’s accounting or doubles down on a crediting regime that researchers say understates long-term warming risks.