CA AB2797

Establishes the Carbon Neutrality Fund and requires the California Department of Tax and Fee Administration to pay annual incentive payments to qualified taxpayers from 2023-2028 on a first-come-first-served basis.

Incentive payments equal $0.05 per gallon equivalent for very low carbon fuels (50% or less of benchmark carbon intensity) and $0.10 per gallon equivalent for carbon-neutral or net negative carbon fuels.

Annual incentive payments cannot exceed the amount of fuel excise tax paid by the qualified taxpayer in that year, and total incentive payments statewide cannot exceed $500,000,000 annually.

Defines "qualified taxpayer" as any vendor selling liquid or gaseous transportation fuels in California; qualifies fuels based on carbon intensity measurements under California's Low Carbon Fuel Standard.

Uses fuel volume and carbon intensity data reported through the Low Carbon Fuel Standard Reporting Tool to calculate incentive payments.