{"id":34,"date":"2026-03-26T20:57:59","date_gmt":"2026-03-26T20:57:59","guid":{"rendered":"https:\/\/www.env.nm.gov\/clean-transportation-fuel-program\/?page_id=34"},"modified":"2026-03-26T21:03:07","modified_gmt":"2026-03-26T21:03:07","slug":"how-does-it-work","status":"publish","type":"page","link":"https:\/\/www.env.nm.gov\/clean-transportation-fuel-program\/how-does-it-work\/","title":{"rendered":"About this program"},"content":{"rendered":"\n<h3 class=\"wp-block-heading has-text-align-center\"><strong><a href=\"https:\/\/www.env.nm.gov\/clean-transportation-fuel-program\/aboutthisprogram\/\">What is it?<\/a> | <a href=\"https:\/\/www.env.nm.gov\/clean-transportation-fuel-program\/why-does-it-matter\/\">Why does it matter?<\/a> | <a href=\"https:\/\/www.env.nm.gov\/clean-transportation-fuel-program\/who-is-involved\/\">Who is involved?<\/a><br>How does it work? | <a href=\"https:\/\/www.env.nm.gov\/clean-transportation-fuel-program\/ctfp-history-and-background\/\">History &amp; background<\/a> | <a href=\"https:\/\/www.env.nm.gov\/clean-transportation-fuel-program\/rulemaking\/\">Rule<\/a> | <a href=\"https:\/\/www.env.nm.gov\/clean-transportation-fuel-program\/where-are-we-in-the-process\/\">Where are we in the process?<\/a><br><a href=\"https:\/\/www.env.nm.gov\/clean-transportation-fuel-program\/get-involved\/\">Get involved<\/a><\/strong><\/h3>\n\n\n\n<div style=\"height:10px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>How does it work?<\/strong><\/h2>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Clean Transportation Fuel Program&nbsp;credit market basics<\/strong>&nbsp;<\/h3>\n\n\n\n<p>A broad range of companies, utilities, and organizations who&nbsp;import or produce&nbsp;fuel&nbsp;used&nbsp;for&nbsp;transportation&nbsp;must&nbsp;register in the&nbsp;program&nbsp;through&nbsp;the Application, Reporting, and Compliance System&nbsp;(ARCS)&nbsp;and generate credits or deficits.&nbsp;<\/p>\n\n\n\n<p>Companies and organizations earn credits or deficits depending on if their specific fuel or fuels <strong>are above or below the corresponding annual carbon intensity standard<\/strong>.&nbsp;<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Fuel with a lower carbon intensity than the standard generates <strong>credits<\/strong>.\u202f&nbsp;<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Fuel with a higher carbon intensity than the standard incurs <strong>deficits<\/strong>.&nbsp;<\/li>\n<\/ul>\n\n\n\n<p>Registered participants pay fees,&nbsp;report fuel use,&nbsp;transfer credits&nbsp;to offset deficits, if needed, and&nbsp;submit&nbsp;periodic&nbsp;compliance&nbsp;reports to&nbsp;NMED.\u202f&nbsp;<\/p>\n\n\n\n<p>After each compliance period, credits are accounted for or \u201cretired.\u201d&nbsp;If&nbsp;a participant has&nbsp;fewer credits than&nbsp;deficits, the balance is recorded as a deficit.\u202fParticipants with a deficit&nbsp;balance&nbsp;must&nbsp;acquire&nbsp;and retire&nbsp;credits.\u202f&nbsp;<\/p>\n\n\n\n<p>Those with&nbsp;a&nbsp;credit&nbsp;balance&nbsp;may \u201cbank\u201d&nbsp;credits&nbsp;or sell them to&nbsp;generate revenue.\u202f&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Enforcement of&nbsp;the program<\/strong>&nbsp;<\/h3>\n\n\n\n<p>The New Mexico Environment Department (NMED)&nbsp;prioritizes a collaborative approach to ensure compliance with the Clean Transportation Fuel Program.&nbsp;The department&nbsp;focuses on providing technical&nbsp;assistance&nbsp;to help&nbsp;participants meet&nbsp;program requirements. When NMED&nbsp;identifies&nbsp;potential non-compliance through data reviews or site inspections, it may issue a notice of non-compliance to inform the&nbsp;participant&nbsp;and encourage a swift resolution.&nbsp;&nbsp;<\/p>\n\n\n\n<p>NMED&nbsp;generally&nbsp;reserves&nbsp;formal enforcement \u2014 such as taking corrective actions or pursuing civil actions \u2014 for instances where a&nbsp;participant&nbsp;fails to&nbsp;cooperate or refuses to take the necessary steps to return to compliance. Nonetheless,&nbsp;NMED&nbsp;reserves its ability to take any enforcement action that may be necessary to protect public and environmental health.&nbsp;See the&nbsp;<a href=\"https:\/\/prod-rf-lambda.rtssaas.com\/PublicFiles\/d89c47bd0d70402dba89b03a22bda6d1\/2009aa19-c548-4aa0-9ad4-71b7e7507f12\/20.2.92.html#:~:text=20.2.92.604%C2%A0%C2%A0%C2%A0%C2%A0%C2%A0%C2%A0%C2%A0%C2%A0%C2%A0%20ENFORCEMENT%3A\" target=\"_blank\" rel=\"noreferrer noopener\">rule section<\/a>&nbsp;to learn more.&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Funding the program<\/strong><\/h3>\n\n\n\n<p>The\u00a0program\u00a0issues and collects fees from program participants to fund its implementation. NMED announces an annual budget, allows for public input, and then distributes the fees according to deficit and credit generated in the\u00a0previous\u00a0reporting periods.\u00a0<\/p>\n\n\n\n<div style=\"height:40px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n","protected":false},"excerpt":{"rendered":"<p>What is it? | Why does it matter? | Who is involved?How does it work? | History &amp; background | Rule | Where are we in the process?Get involved How does it work? Clean Transportation Fuel Program&nbsp;credit market basics&nbsp; A broad range of companies, utilities, and organizations who&nbsp;import or produce&nbsp;fuel&nbsp;used&nbsp;for&nbsp;transportation&nbsp;must&nbsp;register in the&nbsp;program&nbsp;through&nbsp;the Application, Reporting, and [&hellip;]<\/p>\n","protected":false},"author":21,"featured_media":0,"parent":0,"menu_order":0,"comment_status":"closed","ping_status":"closed","template":"","meta":{"footnotes":""},"class_list":["post-34","page","type-page","status-publish","hentry"],"_links":{"self":[{"href":"https:\/\/www.env.nm.gov\/clean-transportation-fuel-program\/wp-json\/wp\/v2\/pages\/34","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.env.nm.gov\/clean-transportation-fuel-program\/wp-json\/wp\/v2\/pages"}],"about":[{"href":"https:\/\/www.env.nm.gov\/clean-transportation-fuel-program\/wp-json\/wp\/v2\/types\/page"}],"author":[{"embeddable":true,"href":"https:\/\/www.env.nm.gov\/clean-transportation-fuel-program\/wp-json\/wp\/v2\/users\/21"}],"replies":[{"embeddable":true,"href":"https:\/\/www.env.nm.gov\/clean-transportation-fuel-program\/wp-json\/wp\/v2\/comments?post=34"}],"version-history":[{"count":2,"href":"https:\/\/www.env.nm.gov\/clean-transportation-fuel-program\/wp-json\/wp\/v2\/pages\/34\/revisions"}],"predecessor-version":[{"id":39,"href":"https:\/\/www.env.nm.gov\/clean-transportation-fuel-program\/wp-json\/wp\/v2\/pages\/34\/revisions\/39"}],"wp:attachment":[{"href":"https:\/\/www.env.nm.gov\/clean-transportation-fuel-program\/wp-json\/wp\/v2\/media?parent=34"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}