Regulation of Fuels and Fuel Additives: Renewable Fuel Standard ...

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determine the applicable percentage. EPA believes this is appropriate because the percentage standard should be based only on the gasoline subject to the renewable volume obligation. This would only occur though the 2010 compliance period when the exemption ends. Calculation of the standard for calendar year 2011 and beyond would include small refinery and small refiner volumes. As discussed above, calculation of the standard requires projections of gasoline use for the upcoming compliance period. EIA does not project small refinery or small refiner gasoline volumes, so other methods of estimating these values are necessary. EPA receives gasoline production data as a part of its fuel programs’ reporting requirements that could be used for this purpose. However, since we do not receive the data until late February, the most recent complete annual data set available would be from two years earlier. Given this, the fact that this adjustment is only needed for 4 years, and because the total small refinery and small refiner gasoline production volume is expected to be fairly constant compared to total U.S. gasoline production during this period, we are proposing to estimate small refinery and small refiner gasoline volumes using a constant percentage of national consumption. This percentage would be based on the most recent small refinery and small refiner gasoline data available in time for the final rule. Using information from gasoline batch reports submitted to EPA, EIA data and input from the California Air Resources Board regarding California small refiners, we have estimated this percentage to be 13.5%. 10 EPA requests comments on this method of estimating small refinery and small refiner gasoline volumes. The Act requires that the small refinery adjustment also account for renewable fuels used during the prior year by small refineries that are exempt and do not participate in the RFS program. Accounting for this volume of renewable fuel would reduce the total volume of renewable fuel use required, and thus directionally would reduce the percentage standard. However, there would be no available data on which to base such an adjustment. Furthermore, EPA believes that the amount of renewable fuel that would qualify (i.e., that was used by exempt small refineries and small refiners but not used as part of the RFS program) would be very small. In light of the total volume of renewable fuel required and the precision in which the statute specifies this total volume, the very small volume at issue here would not change the resulting percentage. Under the proposal, small refineries and small refiners are merely treated as any other renewable blender until 2011. Consequently, whatever renewables they blend will be reflected as RINs available in the market, and thus should not be accounted for in the equation used to determine the standard. Therefore, EPA is proposing to assume this value to be zero. We are proposing that the amount of renewable fuel used in Alaska, Hawaii, or U.S. territories would not affect the amount of renewable fuel required nationwide. We believe this approach is appropriate because the Act requires that the renewable fuel be consumed in the contiguous 48 states unless Alaska, Hawaii, or a U.S. territory opt-in. Additionally, renewable fuel produced in Alaska, Hawaii, and U.S. territories is unlikely to be transported to the contiguous 48 states, and vice versa. Thus, including their 10 “Calculation of the Small Refiner/Small Refinery Fraction for the Renewable Fuel Program,” memo to the docket from Christine Brunner, ASD, OTAQ, EPA, September 2006. - 32 -
enewable fuel volumes in the calculation of the standard would not serve the purpose intended by the Act of ensuring that the statutorily required renewable fuel volumes are consumed in the 48 contiguous States. A final issue that could affect the calculated value of the standard is any deficit carryover from 2006. Any deficit carryover from 2006 would increase the standard only for 2007. Since renewable fuel use in 2006 is expected to exceed the 2.78 percent default standard, we are proposing that no deficit be carried over to 2007. Beginning with the 2007 compliance period, when annual individual party compliance replaces collective compliance, any deficit is calculated for an individual party and is included in the party’s Renewable Volume Obligation (RVO) determination, as discussed in Section III.A.4. In summary, in order to get the total projected non-renewable gasoline volumes from which to calculate the standard, EPA is proposing to use EIA projections of nationwide and state gasoline consumption, and small refinery and small refiner volumes estimated as a constant percentage of national gasoline volumes. Based on the discussion above, the formula which we are proposing to be used for calculating the percentage standard is shown below: Where RFVi − Celli RFStdi = 100 × ( Gi − Ri) + ( GSi − RSi) − GEi RFStdi = Renewable Fuel standard in year i, in percent RFVi = Nationwide annual volume of renewable fuels required by section 211(o)(2)(B) of the Act for year i, in gallons Gi = Amount of gasoline projected to be used in the 48 contiguous states, in year i, in gallons Ri = Amount of renewable fuel blended into gasoline that is projected to be consumed in the 48 contiguous states, in year i, in gallons GSi = Amount of gasoline projected to be used in Alaska, Hawaii, or a U.S. territory in year i if the state or territory opts-in, in gallons RSi = Amount of renewable fuel blended into gasoline that is projected to be consumed in Alaska, Hawaii, or a U.S. territory in year i if the state or territory opts-in, in gallons GEi = Amount of gasoline projected to be produced by exempt small refineries and small refiners in year i, in gallons (through 2010 only) - 33 -
Page 1 and 2: The Administrator signed the follow
Page 3 and 4: Ave., NW, Washington DC. This Docke
Page 5 and 6: Table of contents: I. Background A.
Page 7 and 8: C. Requirements for Producers and I
Page 9 and 10: G. Executive Order 13045: Protectio
Page 11 and 12: The increased use of renewable fuel
Page 13 and 14: establish the applicable national v
Page 15 and 16: Today's proposal outlines the full
Page 17 and 18: enewable fuel feedstock market pric
Page 19 and 20: Unlike VOC and NOx, emissions of CO
Page 21 and 22: These renewable feedstocks are then
Page 23 and 24: 5. Potential Water Quality Impacts
Page 25 and 26: enewable fuel volume which each par
Page 27 and 28: certain volume of renewable fuel. E
Page 29 and 30: est practices would have the option
Page 31: As stated, the renewable fuel stand
Page 35 and 36: For illustrative purposes, we have
Page 37 and 38: These credit provisions have meanin
Page 39 and 40: Stdi = The RFS program standard for
Page 41 and 42: gasoline. The Act is unclear on whe
Page 43 and 44: . Ethanol Made From Any Feedstock I
Page 45 and 46: generate thermal energy used to pro
Page 47 and 48: animal wastes, including poultry fa
Page 49 and 50: limit this program solely to a stra
Page 51 and 52: presence of the denaturant. For ins
Page 53 and 54: First, doing so could create an inc
Page 55 and 56: For purposes of this preamble, the
Page 57 and 58: capability for all of the small ref
Page 59 and 60: trading program, without any per ga
Page 61 and 62: obligated parties. However, there i
Page 63 and 64: particular importance for 2013 and
Page 65 and 66: have to significantly change their
Page 67 and 68: The D code would identify cellulosi
Page 69 and 70: Another case in which a RIN may not
Page 71 and 72: Section IV. In the context of demon
Page 73 and 74: equired volumes shown in Table I.B-
Page 75 and 76: We request comment on the valid lif
Page 77 and 78: e used for current year compliance.
Page 79 and 80: equirements by roughly 10 to 30 per
Page 81 and 82: 4. Provisions For Exporters Of Rene
Page 83 and 84:
Previous-year RINs: RINs that came
Page 85 and 86:
a. Responsibilities Of Renewable Fu
Page 87 and 88:
another, in electronic or paper for
Page 89 and 90:
e a one-to-one correspondence betwe
Page 91 and 92:
Parent batch Actual volume (gal) Ba
Page 93 and 94:
should also have the right to separ
Page 95 and 96:
3. Distribution Of Separated RINs O
Page 97 and 98:
obligated parties to exercise marke
Page 99 and 100:
Our proposed program is designed to
Page 101 and 102:
As discussed in Section III.D, it i
Page 103 and 104:
additional enforcement burdens plac
Page 105 and 106:
B. Requirements for Obligated Parti
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fuel and containing identifying inf
Page 109 and 110:
We request comment on our proposed
Page 111 and 112:
We also request comment on our prop
Page 113 and 114:
The refiner or importer would be li
Page 115 and 116:
Plant Feedstock Corn a Table VI.A.1
Page 117 and 118:
Leading the Midwest in ethanol prod
Page 119 and 120:
EPA forecasts ethanol production to
Page 121 and 122:
As shown in Table VI.A.2-1 and Figu
Page 123 and 124:
3. Current Ethanol and MTBE Consump
Page 125 and 126:
Oxygenate Use (Bgal) 4.5 4.0 3.5 3.
Page 127 and 128:
change from the 2004 base case. 53
Page 129 and 130:
per gallon to biodiesel produced fr
Page 131 and 132:
ased on the assumption that the ble
Page 133 and 134:
Modifications to the rail, barge, t
Page 135 and 136:
other waste materials as discussed
Page 137 and 138:
elatively small fraction of the tot
Page 139 and 140:
production costs using prices for s
Page 141 and 142:
the capital cost of making the nece
Page 143 and 144:
information on biodiesel freight co
Page 145 and 146:
For further details on RVP reductio
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assuming only that blending of etha
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costs). At a $70 per barrel crude o
Page 151 and 152:
gasoline use scenarios will cost th
Page 153 and 154:
the incentive to blend in ethanol b
Page 155 and 156:
supporting this rulemaking. We hope
Page 157 and 158:
We base our estimates of fuel quali
Page 159 and 160:
Table VIII.A.1.b-2 Effect of MTBE a
Page 161 and 162:
pre-1998 model year onroad diesel e
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1. Primary Analysis The national em
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Table VIII.B.1-4 Annual Emissions N
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RFG due to the absence of an RVP wa
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increase in ambient ozone levels is
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developing a model of secondary org
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IX. Impacts On Fossil Fuel Consumpt
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intended to help fuel producers est
Page 177 and 178:
efficiency and to reduce air emissi
Page 179 and 180:
combined those displacement indexes
Page 181 and 182:
3. Displacement Indexes (DI) The di
Page 183 and 184:
Table IX.C.1-1 Fossil fuel impacts
Page 185 and 186:
as on the exports of agricultural p
Page 187 and 188:
which may change in response to an
Page 189 and 190:
X. Agricultural Sector Economic Imp
Page 191 and 192:
XI. Public Participation We request
Page 193 and 194:
ways to comply with any previously
Page 195 and 196:
small refiner under this proposal.
Page 197 and 198:
meet these criteria to be considere
Page 199 and 200:
“economically significant” as d
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40 CFR Part 80 is proposed to be am
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(b) Renewable Fuel Standard for 200
Page 205 and 206:
(2) The term “Renewable fuel” i
Page 207 and 208:
RFStdi = Renewable Fuel Standard in
Page 209 and 210:
a party’s renewable volume obliga
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(a) YYYY is the calendar year in wh
Page 213 and 214:
(ii) The value for EEEEEE in an ext
Page 215 and 216:
(2) A deficit is calculated accordi
Page 217 and 218:
(a) (1) Any party that exports any
Page 219 and 220:
(e) If a refiner is complying on an
Page 221 and 222:
calendar year; however, disqualific
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§80.76, if such information has no
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(1) A summary report of the annual
Page 227 and 228:
(4) Reports shall be submitted on f
Page 229 and 230:
(1) Fail to acquire sufficient RINs
Page 231 and 232:
(b) The following attest procedures
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(B) That the RFS-FRGAS remained seg
Page 235 and 236:
EPA employees or EPA contractors, f
Page 237 and 238:
(iv) Determine the date and time th
Page 239:
(ii) Be licensed as a Certified Pub
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