Regulation of Fuels and Fuel Additives: Renewable Fuel Standard ...
Regulation of Fuels and Fuel Additives: Renewable Fuel Standard ...
Regulation of Fuels and Fuel Additives: Renewable Fuel Standard ...
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4. What Are “Equivalence Values” For <strong>Renewable</strong> <strong>Fuel</strong>?<br />
One question that EPA must address is how to count volumes <strong>of</strong> renewable fuel in<br />
determining compliance with the renewable volume obligation. For instance, the Act<br />
stipulates that every gallon <strong>of</strong> cellulosic ethanol should count as if it were 2.5 gallons for<br />
RFS compliance purposes. The Act does not stipulate similar values for other renewable<br />
fuels, but as described below we believe it is appropriate to do so.<br />
We are proposing that the “Equivalence Values” for different renewable fuels be<br />
based on their energy content in comparison to the energy content <strong>of</strong> ethanol, <strong>and</strong><br />
adjusted as necessary for their renewable content. The result is an Equivalence Value for<br />
corn ethanol <strong>of</strong> 1.0, for biobutanol <strong>of</strong> 1.3, for biodiesel (mono alkyl ester) <strong>of</strong> 1.5, <strong>and</strong> for<br />
cellulosic ethanol <strong>of</strong> 2.5. However, the methodology can be used to determine the<br />
appropriate equivalence value for any other potential renewable fuel as well.<br />
This section describes why we believe that the use <strong>of</strong> relative energy content is<br />
appropriate under the Act, <strong>and</strong> our investigation <strong>of</strong> the alternative use <strong>of</strong> lifecycle<br />
analyses as the basis <strong>of</strong> Equivalence Values.<br />
a. Authority Under The Act To Establish Equivalence Values<br />
We are proposing that Equivalence Values be assigned to every renewable fuel to<br />
provide an indication <strong>of</strong> the number <strong>of</strong> gallons that can be claimed for compliance<br />
purposes for every physical gallon <strong>of</strong> renewable fuel. An Equivalence Value <strong>of</strong> 1.0<br />
would mean that every physical gallon <strong>of</strong> renewable fuel would count as one gallon for<br />
RFS compliance purposes. An Equivalence Value greater than 1.0 would mean that<br />
every physical gallon <strong>of</strong> renewable fuel would count as more than one gallon for RFS<br />
compliance purposes, while a value less than 1.0 would count as less than one gallon.<br />
We are interpreting the Act as allowing EPA to develop Equivalence Values<br />
according to the methodology discussed below. We believe that the use <strong>of</strong> Equivalence<br />
Values is consistent with the intent <strong>of</strong> Congress to treat different renewable fuels<br />
differently in different circumstances, <strong>and</strong> to provide incentives for use <strong>of</strong> renewable<br />
fuels in certain circumstances, as evidenced by those specific circumstances addressed by<br />
Congress. The Act has several provisions that provide for mechanisms other than straight<br />
volume measurement to determine the value <strong>of</strong> a renewable fuel in terms <strong>of</strong> RFS<br />
compliance. For example, 1 gallon <strong>of</strong> cellulosic biomass or waste derived ethanol is to<br />
be treated as 2.5 gallons <strong>of</strong> renewable fuel. EPA is also required to establish an<br />
“appropriate amount <strong>of</strong> credits” for biodiesel, <strong>and</strong> to provide for “an appropriate amount<br />
<strong>of</strong> credit” for using more renewable fuels than are required to meet your obligation. EPA<br />
is also to determine the “renewable fuel portion” <strong>of</strong> a blending component derived from a<br />
renewable fuel. All <strong>of</strong> these statutory provisions provide evidence that Congress did not<br />
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