SANTA FE, N.M. — Gov. Michelle Lujan Grisham signed House Bill 41, Clean Transportation Fuel Standards, into law Tuesday. New Mexico is the fourth state in the nation to enact the standards.

HB 41 allows producers and importers of low-carbon transportation fuels to generate clean fuel credits to sell to producers and importers of high-carbon transportation fuels. HB 41 then directs the emissions of transportation fuels in New Mexico to decrease over time.   

“Clean fuel standards not only decrease emissions and move us toward our climate goals, but also diversify our economy and attract new businesses to our state,” Lujan Grisham said. “Thank you to the bill’s sponsors for their hard work in getting this important legislation across the finish line.”  

Now that HB41 is signed into law, the New Mexico Environment Department will initiate a rulemaking process with the Environment Improvement Board to draft, share, and ultimately adopt rules governing the clean fuel market established by the legislation.

The first step in the rulemaking process is the establishment of an Advisory Group, which will be announced in early May. The first meeting of the Advisory Group is anticipated to take place in July and will continue to do so through November. NMED plans to petition the EIB in late 2024.  

The transportation industry is New Mexico’s second-largest source of emissions, following those from oil and gas production.

The new law calls for a reduction in the intensity of greenhouse gas emissions – cutting it by 20% by 2030 and 30% by 2040.