[Federal Register Volume 71, Number 35 (Wednesday, February 22, 2006)]
[Rules and Regulations]
[Pages 8965-8973]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 06-1613]
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ENVIRONMENTAL PROTECTION AGENCY
40 CFR Part 80
[EPA-HQ-OAR-2005-0170; FRL-8035-2]
Regulation of Fuels and Fuel Additives: Removal of Reformulated
Gasoline Oxygen Content Requirement for California Gasoline and
Revision of Commingling Prohibition To Address Non-Oxygenated
Reformulated Gasoline in California
AGENCY: Environmental Protection Agency (EPA).
ACTION: Direct final rule.
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SUMMARY: In the Energy Policy Act of 2005 (Energy Act), Congress
removed the oxygen content requirement for reformulated gasoline (RFG)
in Section 211(k) of the Clean Air Act (CAA). The Energy Act specified
that this change was to be immediately effective in California, and
that it would be effective 270 days after enactment for the rest of the
country. This direct final rule amends the fuels regulations to remove
the oxygen content requirement for RFG for gasoline produced and sold
for use in California, thereby making the fuels
[[Page 8966]]
regulations consistent with amended Section 211(k). In addition, for
gasoline produced and sold for use in California, this rule extends the
current prohibition against combining VOC-controlled RFG blended with
ethanol with VOC-controlled RFG blended with any other type of
oxygenate from January 1 through September 15, to also prohibit
combining VOC-controlled RFG blended with ethanol with non-oxygenated
VOC-controlled RFG during that time period, except in limited
circumstances authorized by the Act.
The removal of the RFG oxygen content requirement and revision of
the commingling prohibition for gasoline produced and sold for use in
all areas of the country is being published in a separate direct final
rule that will have a later effective date than this California
specific rulemaking.
DATES: This rule is effective on April 24, 2006, without further notice
unless we receive adverse comment by March 24, 2006. If EPA receives
adverse comment, we will publish a timely withdrawal in the Federal
Register informing the public that the portion of the final rule on
which adverse comment was received will not take effect. Those portions
of the rule on which adverse comment was not received will go into
effect on the effective date noted above.
ADDRESSES: Submit your comments, identified by Docket ID No. EPA-HQ-
OAR-2005-0170 by one of the following methods:
1. http://www.regulations.gov: Follow the on-line instructions for
submitting comments.
2. E-mail: Group [email protected]. Attention Docket ID No.
OAR-2005-0170.
4. Mail: Air and Radiation Docket, Environmental Protection Agency,
Mailcode: 6406J, 1200 Pennsylvania Ave., NW., Washington, DC 20460.
Please include a total of two copies. In addition, please mail a copy
of your comments on the information collection provisions to the Office
of Information and Regulatory Affairs, Office of Management and Budget
(OMB), Attn: Desk Officer for EPA, 725 17th St., NW., Washington, DC
20503.
5. Hand Delivery: EPA Docket Center, Environmental Protection
Agency, 1301 Constitution Avenue, NW., Room B102, Mail Code 6102T,
Washington, DC 20460. Such deliveries are only accepted during the
Docket's normal hours of operation, and special arrangements should be
made for deliveries of boxed information.
Instructions: Direct your comments to Docket ID No. EPA-HQ-OAR-
2005-0170. EPA's policy is that all comments received will be included
in the public docket without change and may be made available online at
http://www.regulations.gov, including any personal information
provided, unless the comment includes information claimed to be
Confidential Business Information (CBI) or other information whose
disclosure is restricted by statute. Do not submit information that you
consider to be CBI or otherwise protected through www.regulations.gov
or e-mail. The www.regulations.gov is an ``anonymous access'' system,
which means EPA will not know your identity or contact information
unless you provide it in the body of your comment. If you send an e-
mail comment directly to EPA without going through www.regulations.gov,
your e-mail address will be automatically captured and included as part
of the comment that is placed in the public docket and made available
on the Internet. If you submit an electronic comment, EPA recommends
that you include your name and other contact information in the body of
your comment and with any disk or CD-ROM you submit. If EPA cannot read
your comment due to technical difficulties and cannot contact you for
clarification, EPA may not be able to consider your comment. Electronic
files should avoid the use of special characters, any form of
encryption, and be free of any defects or viruses. For additional
information about EPA's public docket visit the EPA Docket Center
homepage at http://www.epa.gov/epahome/dockets.htm.
We are only taking comment on issues related to the removal of the
oxygen requirement for RFG produced and sold for use in California, and
the provisions regarding the combining of ethanol blended California
RFG with non-oxygenated California RFG and provisions for retailers
regarding the combining of ethanol blended California RFG with non-
ethanol blended California RFG. Comments on any other issues or
provisions in the RFG regulations are beyond the scope of this
rulemaking.
Docket: All documents in the docket are listed in the
www.regulations.gov index. Although listed in the index, some
information is not publicly available, i.e., CBI or other information
whose disclosure is restricted by statute. Certain other material, such
as copyrighted material, will be publicly available only in hard copy
form. Publicly available docket materials are available either
electronically in http://www.regulations.gov or in hard copy at the Air
and Radiation Docket, EPA/DC, EPA West, Room B102, 1301 Constitution
Ave., NW., Washington, DC. The Public Reading Room is open from 8:30
a.m. to 4:30 p.m., Monday through Friday, excluding legal holidays. The
telephone number for the Public Reading Room is (202) 566-1744, and the
telephone number for the Air and Radiation Docket is (202) 566-1742.
FOR FURTHER INFORMATION CONTACT: Marilyn Bennett, Transportation and
Regional Programs Division, Office of Transportation and Air Quality
(6406J), Environmental Protection Agency, 1200 Pennsylvania Avenue,
NW., Washington, DC 20460; telephone number: (202) 343-9624; fax
number: (202) 343-2803; e-mail address: [email protected].
SUPPLEMENTARY INFORMATION: EPA is publishing this rule without prior
proposal because we view this action to be noncontroversial and
anticipate no adverse comment. However, in the ``Proposed Rules''
section of today's Federal Register publication, we are publishing a
separate document that will serve as the proposal to adopt the
provisions in this Direct Final Rule if adverse comments are filed.
This rule will be effective on April 24, 2006 without further notice
except to the extent that we receive adverse comment by March 24, 2006.
If EPA receives adverse comment, we will publish a timely withdrawal in
the Federal Register informing the public that the portion of the rule
on which adverse comment was received will not take effect. We will
address all public comments in a subsequent final rule based on the
proposed rule. We will not institute a second comment period on this
action. Any parties interested in commenting must do so at this time.
Any distinct amendment, paragraph, or section of today's rule for which
we do not receive adverse comment will become effective on the date set
out above, notwithstanding any adverse comment on any other distinct
amendment, paragraph, or section of today's rule.
I. General Information
A. Does This Action Apply To Me?
Entities potentially affected by this action include those involved
with the production and importation of conventional gasoline motor
fuel. Regulated categories and entities affected by this action
include:
[[Page 8967]]
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Examples of
NAICS codes SIC codes potentially
Category \a\ \b\ regulated
parties
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Industry.................... 324110 2911 Petroleum
Refiners,
Importers.
Industry.................... 422710 5171 Gasoline
Marketers and
Distributors.
422720 5172
Industry.................... 484220 4212 Gasoline
Carriers.
484230 4213
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\a\ North American Industry Classification System (NAICS).
\b\ Standard Industrial Classification (SIC) system code.
This table is not intended to be exhaustive, but rather provides a
guide for readers regarding entities likely to be regulated by this
action. This table lists the types of entities that EPA is now aware
could be potentially regulated by this action. Other types of entities
not listed in the table could also be regulated. To determine whether
your entity is regulated by this action, you should carefully examine
the applicability criteria of Part 80, subparts D, E and F of title 40
of the Code of Federal Regulations. If you have any question regarding
applicability of this action to a particular entity, consult the person
in the preceding FOR FURTHER INFORMATION CONTACT section above.
B. What Should I Consider as I Prepare My Comments for EPA?
1. Submitting CBI. Do not submit this information to EPA through
www.regulations.gov or e-mail. Clearly mark the part or all of the
information that you claim to be CBI. For CBI information in a disk or
CD-ROM that you mail to EPA, mark the outside of the disk or CD-ROM as
CBI and then identify electronically within the disk or CD-ROM the
specific information that is claimed as CBI). In addition to one
complete version of the comment that includes information claimed as
CBI, a copy of the comment that does not contain the information
claimed as CBI must be submitted for inclusion in the public docket.
Information so marked will not be disclosed except in accordance with
procedures set forth in 40 CFR Part 2.
2. Tips for Preparing Your Comments. When submitting comments,
remember to:
1. Identify the rulemaking by docket number and other identifying
information (subject heading, Federal Register date and page number).
2. Follow directions--The agency may ask you to respond to specific
questions or organize comments by referencing a Code of Federal
Regulations (CFR) part or section number.
3. Explain why you agree or disagree; suggest alternatives and
substitute language for your requested changes.
4. Describe any assumptions and provide any technical information
and/or data that you used.
5. If you estimate potential costs or burdens, explain how you
arrived at your estimate in sufficient detail to allow for it to be
reproduced.
6. Provide specific examples to illustrate your concerns, and
suggest alternatives.
7. Explain your views as clearly as possible, avoiding the use of
profanity or personal threats.
8. Make sure to submit your comments by the comment period deadline
identified.
3. Docket Copying Costs. You may be charged a reasonable fee for
photocopying docket materials, as provided in 40 CFR Part 2.
C. Outline of This Preamble
I. General Information
II. Removal of the RFG Oxygen Content Requirement for California
Gasoline
III. Combining Ethanol Blended California RFG With Non-Ethanol
Blended California RFG
IV. Environmental Effects of This Action
V. Statutory and Executive Order Reviews
VI. Statutory Provisions and Legal Authority
II. Removal of the RFG Oxygen Content Requirement for California
Gasoline
Section 211(k) of the 1990 Amendments to the CAA required
reformulated gasoline (RFG) to contain oxygen in an amount that equals
or exceeds 2.0 weight percent. CAA Section 211(k)(2)(B). Accordingly,
EPA's current regulations require RFG refiners, importers and oxygenate
blenders to meet a 2.0 or greater weight percent oxygen content
standard. 40 CFR 80.41. Recently, Congress passed legislation which
amended Section 211(k) of the CAA to remove the RFG oxygen
requirement.\1\ The Energy Act specified that this change was to be
immediately effective in California, and that it would be effective 270
days after enactment for the rest of the country. To make the fuels
rules consistent with the current Section 211(k), today's rule modifies
the RFG regulations to remove the oxygen standard in Sec. 80.41 for
gasoline produced and sold for use in California.\2\ (Modifications to
the RFG regulations to remove the oxygen standard for gasoline produced
and sold for use in all areas of the country are being published in a
separate rulemaking.)
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\1\ Energy Policy Act of 2005, Pub. L. 109-58 (HR6), section
1504(a), 119 STAT 594, 1076-1077(2005).
\2\ The RFG regulations were promulgated under authority of CAA
Section 211(c) as well as CAA Section 211(k). The regulations were
adopted under section 211(c) primarily for the purpose of applying
the preemption provisions in Section 211(c)(4). See 59 FR 7809
(February 16, 1994.)
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Today's rule also modifies other provisions of the RFG regulations
which relate to the removal of the oxygen content requirement for
gasoline produced and sold for use in California. The modifications to
the affected sections are listed in the following table:
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\3\ The regulations also include oxygen minimum standards for
simple model RFG and Phase I complex Model RFG, and an oxygen
maximum standard for simple model RFG. See Sec. Sec. 80.41(a)
through (d), and (g). These standards are no longer in effect and
today's rule does not modify the regulations to remove these
standards or compliance requirements relating to these standards,
except where such requirements are included in provisions requiring
other changes in today's rule.
Sec. Sec. 80.41(e) and (f)................... Removes the per-gallon
and averaged oxygen
standards for Phase
II Complex Model RFG
for gasoline produced
and sold for use in
California.\3\
Sec. 80.41(o)................................. Adds a provision which
specifies that the
requirements in Sec.
80.41(o) do not
apply to California
gasoline.
[[Page 8968]]
Sec. 80.78(a)................................. Removes the
prohibition against
producing and
marketing California
RFG that does not
meet the oxygen
minimum standard
since the oxygen
standard has been
removed. Also removes
requirements for
California gasoline
to meet the oxygen
minimum standard
during transition
from RBOB to RFG in a
storage tank.
(Today's rule also
removes the provision
in Sec. 80.78(a)(1)
regarding compliance
with the maximum
oxygen standard in
Sec. 80.41 for
simple model RFG. See
footnote 3.)
Sec. 80.79.................................... Removes quality
assurance requirement
to test California
gasoline for
compliance with the
oxygen standard.
Sec. 80.81(d)................................. Removes requirement
for oxygenate
blenders to exclude
California gasoline
from compliance
calculations since
oxygenate blenders
are no longer
required to
demonstrate
compliance with a
standard.
Sec. 80.81(e)................................. Removes Sec.
80.81(e)(2) which
required refiners,
importers and
oxygenate blenders to
provide written
notification to EPA
to produce or import
gasoline certified
under Title 13 of the
California Code of
Regulations, sections
2265 or 2266, or to
comply with an oxygen
content compliance
survey option, since
these requirements
related to ensuring
compliance with the
federal RFG oxygen
content standard.
Also removes
reference to
oxygenate blenders in
Sec. 80.81(e)(3)
regarding withdrawal
of California
gasoline exemptions
for parties who have
violated California
or federal RFG
regulations.
Sec. 80.81(h)................................. Removes provisions for
oxygenate blenders to
use California test
methods for purposes
of compliance
testing, since
oxygenate blenders
are no longer
required to conduct
testing for
compliance with the
oxygen standard.
III. Combining Ethanol Blended California RFG With Non-Ethanol Blended
California RFG
As discussed above, Section 211(k) required RFG to contain a
minimum of 2.0 weight percent oxygen, and the current fuels regulations
reflect this requirement. Refiners, importers and oxygenate blenders
have used different oxygenates to meet this requirement. RFG that
contains ethanol must be specially blended to account for the RVP
``boost'' that ethanol provides, and the consequent possibility of
increased VOC emissions. EPA's existing regulations prohibit the
commingling of ethanol-blended RFG with RFG containing other oxygenates
because the non-ethanol RFG is typically not able to be mixed with
ethanol and still comply with the VOC performance standards. Since all
RFG is currently required to contain oxygen, the regulations do not now
contain a prohibition against combining ethanol-blended RFG with non-
oxygenated RFG. With the removal of the oxygen content requirement for
RFG, EPA expects that refiners and importers will be producing some RFG
without oxygen and some with ethanol or other oxygenates. Mixing
ethanol-blended RFG with non-oxygenated RFG has the same potential to
create an RVP ``boost'' for the non-oxygenated gasoline as mixing
ethanol blended RFG with RFG blended with other oxygenates. This is of
particular concern regarding RFG because most refiners and importers
comply with the RFG VOC emissions performance standard on an annual
average basis calculated at the point of production or importation. All
downstream parties are prohibited from marketing RFG which does not
comply with a less stringent downstream VOC standard. However, even
though the combined gasoline may meet the downstream VOC standard,
combining ethanol-blended RFG with non-oxygenated RFG may cause some
gasoline to have VOC emissions which are higher on average than the
gasoline as produced or imported. Thus, with regard to gasoline
produced and sold for use in California, today's rule extends the
commingling prohibition currently in the fuels regulations to include a
prohibition against combining VOC-controlled ethanol blended RFG with
VOC-controlled non-oxygenated RFG during the period January 1 through
September 15, with one exception, described below.
The Energy Act contains a provision which specifically addresses
the combining of ethanol-blended RFG with non-ethanol-blended RFG.\4\
Under this new provision, retail outlets are allowed to sell non-
ethanol-blended RFG which has been combined with ethanol-blended RFG
under certain conditions. First, each batch of gasoline to be blended
must have been ``individually certified as in compliance with
subsections (h) and (k) prior to being blended.'' Second, the retailer
must notify EPA prior to combining the gasolines and identify the exact
location of the retail outlet and specific tank in which the gasoline
is to be combined. Third, the retailer must retain, and, upon request
by EPA, make available for inspection certifications accounting for all
gasoline at the retail outlet. Fourth, retailers are prohibited from
combining VOC-controlled gasoline with non-VOC-controlled gasoline
between June 1 and September 15. Retailers are also limited with regard
to the frequency in which batches of non-ethanol-blended RFG may be
combined with ethanol-blended RFG. Retailers may combine such batches
of RFG a maximum of two periods between May 1 and September 15. Each
period may be no more than ten consecutive calendar days. This direct
final rule implements this provision of the Energy Act for California
gasoline. A separate direct final rule will implement this provision
for the rest of the country, with a later effective date coinciding
with the removal of the RFG oxygen content requirement for such areas.
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\4\ Energy Policy Act of 2005, Pub. L. 109-58 (HR6), section
1513, 119 STAT 594, 1088-1090 (2005).
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This new provision will typically be used by retail outlets to
change from the use of RFG containing ethanol to RFG not containing
ethanol or vice versa. (Such a change is usually referred to as a
``tank turnover.'') Such blending can result in additional VOC
emissions, perhaps resulting in gasoline that does not comply with
downstream VOC standards. The Energy Act is unclear as to when the
gasoline in the tank where blending occurs must be in compliance with
the downstream VOC standard.
EPA has already promulgated regulations setting out a methodology
for making tank turnovers. 40 CFR 80.78(a)(10). EPA believes retailers
and wholesale purchaser-consumers should have additional flexibility
during the time that they are converting their tanks from one type of
RFG to another, while minimizing the time period during which non-
compliant gasoline is present in their tanks and being sold. Today's
changes provide additional flexibility to the regulated parties by
interpreting the Energy Act to provide retailers and wholesale
purchaser-consumers with relief from compliance with the downstream VOC
standard during the ten-day blending period, but requiring that the
gasoline in the tank thereafter be in compliance or be deemed in
compliance with the downstream VOC standard.
To provide assurance that gasoline is in compliance with the
downstream VOC standard after the ten-day period,
[[Page 8969]]
today's regulations provide that there be two options available for
retailers and wholesale purchaser-consumers. Under the first option,
the retailer may add both ethanol-blended RFG and non-ethanol-blended
RFG to the same tank an unlimited number of times during the ten-day
period, but must test the gasoline in the tank at the end of the ten-
day period to make sure that the RFG is in compliance with the VOC
standard. Under the second option, the retailer must draw the tank down
as much as practicable at the start of the ten-day period, before RFG
of another type is added to the tank, and add only RFG of one type to
the tank during the ten-day period. That is, the retailer may not add
both ethanol-blended RFG and non-ethanol-blended RFG to the tank during
the ten-day period, but may add only one of these types of RFG. EPA
believes that when retailers and wholesale purchaser-consumers use this
second option it is likely that their gasoline will comply with the
downstream VOC standard at the end of the ten-day period, so that
testing will not be necessary. We also believe that this approach is
compatible with current practices of most retailers and wholesale
purchaser-consumers, and expect that most will find it preferable to
testing at the end of the ten-day period.
The commingling provisions apply at a retail level such that each
retailer may take advantage of a maximum of two ten-day blending
periods between May 1 and September 15 of each calendar year. Thus, the
options described above are available to each retail outlet for each of
two ten-day periods during the VOC control period. During each ten-day
period the options are available for all tanks at that retail outlet.
Regarding the requirement that each batch of gasoline to be blended
must have been individually certified as in compliance with subsections
(h) and (k), EPA notes that all gasoline in compliance with RFG
requirements is deemed certified under Section 211(k) pursuant to Sec.
80.40(a). Section 211(h) addresses RVP requirements for gasoline, but
EPA does not have a program to certify gasoline as in compliance with
this provision. For purposes of the commingling exception for retail
outlets incorporated today in Sec. 80.78(a)(8), EPA will deem gasoline
that is in compliance with the regulatory requirements implementing
Section 211(h) to be certified under that section. Regarding the
requirement that retailers retain and make available to EPA upon
request ``certifications'' accounting for all gasoline at the retail
outlet, EPA will deem this requirement fulfilled where the retailer
retains and makes available to EPA, upon request, the product transfer
documentation required under Sec. 80.77 for all gasoline at the retail
outlet.
Under this direct final rule, the provisions which allow retailers
to sell non-ethanol-blended California RFG that has been combined with
ethanol-blended California RFG also apply to wholesale purchaser-
consumers. Like retailers, wholesale purchaser-consumers are parties
who dispense gasoline into vehicles, and EPA interprets the Energy Act
reference to retailers as applying equally to them. As a result,
wholesale purchaser-consumers are treated in the same manner as
retailers under this rule. This is consistent with the manner in which
wholesale purchaser-consumers have been treated in the past under the
fuels regulations.
Most of the provisions of this rule are necessary to implement
amendments to the Clean Air Act included in the Energy Act that
eliminate the RFG oxygen content requirement and allow limited
commingling of ethanol-blended and non-ethanol-blended RFG. The
extension of the general commingling prohibition in the fuels
regulations to cover non-oxygenated RFG is necessary because of the
Energy Act amendments, but is issued pursuant to authority of CAA
Section 211(k). This provision extends the current program to reflect
the presence of non-oxygenated RFG, and is designed to enhance
environmental benefits of the RFG program at reasonable cost to
regulated parties.
IV. Environmental Effects of This Action
Little or no environmental impact is anticipated to occur as a
result of today's action to remove the oxygenate requirement for
California RFG. The RFG standards consist of content and emission
performance standards. Refiners and importers will have to continue to
meet all the emission performance standards for RFG whether or not the
RFG contains any oxygenate. This includes both the VOC and
NOX emission performance standards, as well as the air
toxics emission performance standards which were tightened in the
mobile source air toxics (MSAT) rule in 2001.\5\ New MSAT standards
currently under development are anticipated to achieve even greater air
toxics emission reductions.
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\5\ 66 FR 17230 (March 29, 2001).
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We have analyzed the potential impacts on emissions that could
result from removal of the oxygenate requirement in the context of
requests for waivers of the federal oxygen requirement.\6\ We found
that changes in ethanol use could lead to small increases in some
emissions and small decreases in others while still meeting the RFG
performance standards. These potential impacts are associated with the
degree to which ethanol will continue to be blended into RFG after
removal of the oxygen requirement. Past analyses have projected
significant use of ethanol in RFG in California despite removal of the
oxygenate requirement.\7\ Given current gasoline prices and the
tightness in the gasoline market, the favorable economics of ethanol
blending, a continuing concern over MTBE use by refiners, the emission
performance standards still in place for RFG, and the upcoming
renewable fuels mandate,\8\ we believe that ethanol will continue to be
used in RFG in California after the oxygen requirement is removed. As a
result, we believe that the removal of the oxygenate mandate will have
little or no environmental impact in the near future. We will be
looking at the long term effect of oxygenate use in the context of the
rulemaking to implement the renewable fuels mandate.
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\6\ See e.g., California Oxygen Waiver Decision, EPA420-S-05-005
(June 2005); Analysis of and Action on New York Department of
Conservation's Request for a Waiver of the Oxygen Content
Requirement in Federal Reformulated Gasoline, EPA420-D-05-06 (June
2005).
\7\ Technical Support Document: Analysis of California's Request
for Waiver of the Reformulated Gasoline Oxygen Content Requirement
for California Covered Areas, EPA420-R-01-016 (June 2001).
\8\ Energy Policy Act of 2005, Pub. L. 109-58 (HR6), section
1501, 119 STAT 594, 1067-1076, (2005).
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V. Statutory and Executive Order Reviews
A. Executive Order 12866: Regulatory Planning and Review
Under Executive Order 12866, (58 FR 51735 (October 4, 1993)) the
Agency must determine whether the regulatory action is ``significant''
and therefore subject to OMB review and the requirements of the
Executive Order. The Order defines ``significant regulatory action'' as
one that is likely to result in a rule that may:
(1) Have an annual effect on the economy of $100 million or more or
adversely affect in a material way the economy, a sector of the
economy, productivity, competition, jobs, the environment, public
health or safety, or State, local, or tribal governments or
communities;
[[Page 8970]]
(2) Create a serious inconsistency or otherwise interfere with an
action taken or planned by another agency;
(3) Materially alter the budgetary impact of entitlements, grants,
user fees, or loan programs or the rights and obligations of recipients
thereof; or
(4) Raise novel legal or policy issues arising out of legal
mandates, the President's priorities, or the principles set forth in
the Executive Order.
It has been determined that this direct final rule does not satisfy
the criteria stated above. As a result, this rule is not a
``significant regulatory action'' under the terms of Executive Order
12866 and is therefore not subject to OMB review. Today's rule removes
certain requirements for all refiners, importers and oxygenate blenders
of RFG in California. As a result, this rule is expected to greatly
reduce overall compliance costs for all refiners, importers and
oxygenate blenders of California RFG. This rule also provides options
for gasoline retailers in California to commingle certain compliant
gasolines which otherwise would be prohibited from being commingled.
Although there may be small compliance costs associated with one of
these options, we believe that the additional flexibility provided by
this option will reduce overall compliance costs for these parties.
B. Paperwork Reduction Act
This action does not impose any new information collection burden.
Refiners, importers and oxygenate blenders of California RFG are exempt
from the reporting and recordkeeping requirements under the RFG
regulations. 40 CFR 80.81. Therefore, the removal of the oxygen
requirement for California RFG will not have any ICR implications for
refiners, importers and oxygenate blenders of California RFG. Small
testing costs may be associated with one of the options for California
gasoline retailers to commingle compliant gasolines. However, these
testing costs are expected to be minimal and will be greatly outweighed
by the flexibility provided by the option to commingle compliant
gasolines. The Office of Management and Budget (OMB) has previously
approved the information collection requirements contained in the
existing regulations in 40 CFR part 80 under the provisions of the
Paperwork Reduction Act, 44 U.S.C. 3501 et seq. and has assigned OMB
control number 2060-0277, EPA ICR number 1591.15. A copy of the OMB
approved Information Collection Request (ICR) may be obtained from
Susan Auby, Collection Strategies Division; U.S. Environmental
Protection Agency (2822T); 1200 Pennsylvania Ave., NW., Washington, DC
20460 or by calling (202) 566-1672.
Burden means the total time, effort, or financial resources
expended by persons to generate, maintain, retain, or disclose or
provide information to or for a Federal agency. This includes the time
needed to review instructions; develop, acquire, install, and utilize
technology and systems for the purposes of collecting, validating, and
verifying information, processing and maintaining information, and
disclosing and providing information; adjust the existing ways to
comply with any previously applicable instructions and requirements;
train personnel to be able to respond to a collection of information;
search data sources; complete and review the collection of information;
and transmit or otherwise disclose the information.
An agency may not conduct or sponsor, and a person is not required
to respond to a collection of information unless it displays a
currently valid OMB control number. The OMB control numbers for EPA's
regulations in 40 CFR are listed in 40 CFR part 9.
C. Regulatory Flexibility Act
The Regulatory Flexibility Act (RFA) generally requires an agency
to prepare a regulatory flexibility analysis of any rule subject to
notice and comment rulemaking requirements under the Administrative
Procedures Act or any other statute unless the agency certifies that
the rule will not have a significant economic impact on a substantial
number of small entities. Small entities include small businesses,
small organizations, and small governmental jurisdictions.
For purposes of assessing the impacts of today's rule on small
entities, small entity is defined as: (1) A small business as defined
by the Small Business Administration's regulations at 13 CFR 121.201);
(2) a small governmental jurisdiction that is a government of a city,
county, town, school district or special district with a population of
less than 50,000; and (3) a small organization that is any not-for-
profit enterprise which is independently owned and operated and is not
dominant in its field.
After considering the economic impacts of today's rule on small
entities, I certify that this action will not have a significant
economic impact on a substantial number of small entities. In
determining whether a rule has a significant economic impact on a
substantial number of small entities, the impact of concern is any
significant adverse economic impact on small entities, since the
primary purpose of the regulatory flexibility analyses is to identify
and address regulatory alternatives ``which minimize any significant
economic impact of the proposed rule on small entities.'' 5 U.S.C. 603
and 604. Thus, an agency may conclude that a rule will not have a
significant economic impact on a substantial number of small entities
if the rule relieves regulatory burden, or otherwise has a positive
economic effect on all of the small entities subject to the rule.
This direct final rule removes certain requirements for all
refiners, importers and oxygenate blenders of California RFG, including
small business refiners, importers and oxygenate blenders.
Specifically, this rule removes the burden on refiners, importers and
oxygenate blenders to comply with the RFG oxygen requirement and
associated compliance requirements. This rule also provides options for
gasoline retailers to commingle certain compliant gasolines which
otherwise would be prohibited from being commingled. Although one
option requires some compliance testing, the testing costs are expected
to be minimal. As a result, we have concluded that this direct final
rule, overall, will relieve regulatory burden for small entities
subject to the RFG regulations.
D. Unfunded Mandates Reform Act
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public
Law 104-4, establishes requirements for Federal agencies to assess the
effects of their regulatory actions on State, local, and tribal
governments and the private sector. Under section 202 of the UMRA, EPA
generally must prepare a written statement, including a cost-benefit
analysis, for proposed and final rules with ``Federal mandates'' that
may result in expenditures to State, local, and tribal governments, in
the aggregate, or to the private sector, of $100 million or more in any
one year. Before promulgating an EPA rule for which a written statement
is needed, section 205 of the UMRA generally requires EPA to identify
and consider a reasonable number of regulatory alternatives and adopt
the least costly, most cost-effective or least burdensome alternative
that achieves the objectives of the rule. The provisions of section 205
do not apply when they are inconsistent with applicable law. Moreover,
section 205 allows EPA to adopt an alternative other than the least
costly, most cost-effective or least burdensome alternative if the
Administrator publishes with the final rule an explanation why that
alternative was not adopted. Before EPA establishes
[[Page 8971]]
any regulatory requirements that may significantly or uniquely affect
small governments, including tribal governments, it must have developed
under section 203 of the UMRA a small government agency plan. The plan
must provide for notifying potentially affected small governments,
enabling officials of affected small governments to have meaningful and
timely input in the development of EPA regulatory proposals with
significant Federal intergovernmental mandates, and informing,
educating, and advising small governments on compliance with the
regulatory requirements.
This direct final rule contains no Federal mandates (under the
regulatory provisions of Title II of the UMRA) for State, local or
tribal governments or the private sector that will result in
expenditures of $100 million or more. This rule affects gasoline
refiners, importers and oxygenate blenders by removing the oxygen
content requirement for RFG and associated compliance requirements, and
allows gasoline retailers options for commingling compliant gasolines
which otherwise would be prohibited from being commingled. This rule
will have the overall effect of reducing the burden of the RFG
regulations on these regulated parties. Therefore, the requirements of
the Unfunded Mandates Act do not apply to this action.
E. Executive Order 13132: Federalism
Executive Order 13132, entitled ``Federalism'' (64 FR 43255, August
10, 1999), requires EPA to develop an accountable process to ensure
``meaningful and timely input by State and local officials in the
development of regulatory policies that have federalism implications.''
``Policies that have federalism implications'' is defined in the
Executive Order to include regulations that have ``substantial direct
effects on the States, on the relationship between the national
government and the States, or on the distribution of power and
responsibilities among the various levels of government.''
This direct final rule does not have federalism implications. It
will not have substantial direct effects on the States, on the
relationship between the national government and the States, or on the
distribution of power and responsibilities among the various levels of
government, as specified in Executive Order 13132. This rule removes
the burden on regulated parties of having to comply with the oxygen
standard for RFG in California, and allows gasoline retailers to
commingle certain compliant gasolines which otherwise would be
prohibited from being commingled. Thus, Executive Order 13132 does not
apply to this rule.
F. Executive Order 13175: Consultation and Coordination With Indian
Tribal Governments
Executive Order 13175, entitled ``Consultation and Coordination
with Indian Tribal Governments'' (65 FR 67249, November 6, 2000),
requires EPA to develop an accountable process to ensure ``meaningful
and timely input by tribal officials in the development of regulatory
policies that have tribal implications.'' ``Policies that have tribal
implications'' is defined in the Executive Order to include regulations
that have ``substantial direct effects on one or more Indian tribes, on
the relationship between the Federal Government and the Indian tribes,
or on the distribution of power and responsibilities between the
Federal Government and Indian tribes.''
This direct final rule does not have tribal implications. It will
not have substantial direct effects on tribal governments, on the
relationship between the Federal Government and Indian tribes, or on
the distribution of power and responsibilities between the Federal
government and Indian tribes, as specified in Executive Order 13175.
This rule applies to gasoline refiners, importers, oxygenate blenders
and retailers who supply RFG in California. This action contains
certain modifications to the federal requirements for RFG, and does not
impose any enforceable duties on communities of Indian tribal
governments. Thus, Executive Order 13175 does not apply to this rule.
G. Executive Order 13045: Protection of Children From Environmental
Health and Safety Risks
Executive Order 13045: ``Protection of Children from Environmental
Health Risks and Safety Risks'' (62 FR 19885, April 23, 1997) applies
to any rule that: (1) is determined to be ``economically significant''
as defined under Executive Order 12866, and (2) concerns an
environmental health or safety risk that EPA has reason to believe may
have a disproportionate effect on children. If the regulatory action
meets both criteria, the Agency must evaluate the environmental health
or safety effects of the planned rule on children, and explain why the
planned regulation is preferable to other potentially effective and
reasonably feasible alternatives considered by the Agency.
EPA interprets Executive Order 13045 as applying only to those
regulatory actions that are based on health or safety risks, such that
the analysis required under the Order has the potential to influence
the regulation. This direct final rule is not subject to Executive
Order 13045 because it is not economically significant and does not
establish an environmental standard intended to mitigate health or
safety risks.
H. Executive Order 13211: Acts That Significantly Affect Energy Supply,
Distribution, or Use
This direct final rule is not an economically ``significant energy
action'' as defined in Executive Order 13211, ``Actions Concerning
Regulations That Significantly Affect Energy Supply, Distribution, or
Use'' (66 FR 28355 (May 22, 2001)) because it does not have a
significant adverse effect on the supply, distribution, or use of
energy. This rule eliminates the oxygen content requirement for RFG in
California. This change will have the effect of reducing burdens on
suppliers of RFG, which, in turn, may have a positive effect on
gasoline supplies. RFG refiners and blenders may continue to use
oxygenates at their discretion where and when it is most economical to
do so. With the implementation of the renewable fuels standard also
contained in the Energy Act, the blending of ethanol, in particular,
into gasoline is expected to increase considerably, not decrease.
Therefore, despite this action to remove the oxygenate mandate for RFG
in California, when viewed in the context of companion energy
legislation, overall use of oxygenates is expected to increase in the
future. This rule also allows gasoline retailers to commingle certain
compliant gasolines which otherwise would be prohibited from being
commingled. This also may have a positive effect on gasoline supplies.
I. National Technology Transfer and Advancement Act
Section 12(d) of the National Technology Transfer and Advancement
Act of 1995 (``NTTAA''), Public Law 104-113, section 12(d) (15 U.S.C.
272 note) directs EPA to use voluntary consensus standards in its
regulatory activities unless to do so would be inconsistent with
applicable law or otherwise impractical. Voluntary consensus standards
are technical standards (e.g., materials specifications, test methods,
sampling procedures, and business practices) that are developed or
adopted by voluntary consensus standards bodies. The NTTAA directs EPA
to provide Congress, through OMB, explanations when the Agency decides
not to use available and applicable voluntary consensus standards.
[[Page 8972]]
This direct final rule does not establish new technical standards
within the meaning of the NTTAA. Therefore, EPA did not consider the
use of any voluntary consensus standards.
J. Congressional Review Act
The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the
Small Business regulatory Enforcement Fairness Act of 1996, generally
provides that before a rule may take effect, the agency promulgating
the rule must submit a rule report, which includes a copy of the rule,
to each House of the Congress and to the Comptroller General of the
United States. EPA will submit a report containing this rule and other
required information to the U.S. Senate, the U.S. House of
Representatives, and the Comptroller General of the United States prior
to publication of the rule in the Federal Register. A ``major rule''
cannot take effect until 60 days after it is published in the Federal
Register. This action is not a ``major rule'' as defined by 5 U.S.C.
804(a).
K. Clean Air Act Section 307(d)
This rule is subject to Section 307(d) of the CAA. Section
307(d)(7)(B) provides that ``[o]nly an objection to a rule or procedure
which was raised with reasonable specificity during the period for
public comment (including any public hearing) may be raised during
judicial review.'' This section also provides a mechanism for the EPA
to convene a proceeding for reconsideration, ``[i]f the person raising
an objection can demonstrate to the EPA that it was impracticable to
raise such objection within [the period for public comment] or if the
grounds for such objection arose after the period for public comment
(but within the time specified for judicial review) and if such
objection is of central relevance to the outcome of the rule.'' Any
person seeking to make such a demonstration to the EPA should submit a
Petition for Reconsideration to the Office of the Administrator, U.S.
EPA, Room 3000, Ariel Rios Building, 1200 Pennsylvania Ave., NW.,
Washington, DC 20460, with a copy to both the person(s) listed in the
preceding FOR FURTHER INFORMATION CONTACT section, and the Director of
the Air and Radiation Law Office, Office of General Counsel (Mail Code
2344A), U.S. EPA, 1200 Pennsylvania Ave., NW., Washington, DC 20004.
VI. Statutory Provisions and Legal Authority
The statutory authority for the actions in today's direct final
rule comes from sections 211(c), 211(k) and 301(a) of the CAA.
List of Subjects in 40 CFR Part 80
Environmental protection, Air pollution control, Fuel additives,
Gasoline, Motor vehicle pollution, Reporting and recordkeeping
requirements.
Dated: February 14, 2006.
Stephen L. Johnson,
Administrator.
0
40 CFR part 80 is amended as follows:
PART 80--REGULATION OF FUELS AND FUEL ADDITIVES
0
1. The authority citation for part 80 continues to read as follows:
Authority: 42 U.S.C. 7414, 7545 and 7601(a)).
Subpart D--[Amended]
0
2. Section 80.41 is amended by:
0
a. In the tables in paragraphs (e) and (f), revising the entries
``Oxygen content (percent, by weight)''; and
0
b. adding paragraph (o)(4), to read as follows:
Sec. 80.41 Standards and requirements for compliance.
* * * * *
(e) * * *
* * * * *
Oxygen content (percent, by weight) (does not apply to gasoline >=2.0
subject to the provisions in Sec. 80.81).....................
* * * * *
(f) * * *
* * * * *
Oxygen content (percent, by weight) (does not apply to gasoline
subject to the provisions in Sec. 80.81):
Standard.................................................... >=2.1
Per-Gallon Minimum.......................................... >=1.5
* * * * *
* * * * *
(o) * * *
(4) Paragraph (o) of this section does not apply to gasoline
subject to the provisions in Sec. 80.81.
* * * * *
0
3. Section 80.78 is amended by adding paragraphs (a)(1)(ii)(C),
(a)(8)(i) through (iv), and (a)(11)(iv)(D) to read as follows:
Sec. 80.78 Controls and prohibitions on reformulated gasoline.
* * * * *
(a) * * *
(1) * * *
(ii) * * *
(C) Paragraph (a)(1)(ii)(A) does not apply to gasoline subject to
the provisions in Sec. 80.81.
* * * * *
(8) * * *
(i) For gasoline that is subject to the provisions in Sec. 80.81,
no person may combine any ethanol-blended VOC-controlled reformulated
gasoline with any non-ethanol-blended VOC-controlled reformulated
gasoline during the period January 1 through September 15, except that:
(ii) Retailers and wholesale purchaser-consumers may combine at a
retail outlet or wholesale purchaser-consumer facility ethanol-blended
VOC-controlled reformulated gasoline with non-ethanol-blended VOC-
controlled reformulated gasoline, provided that the retailer or
wholesale purchaser-consumer:
(A) Combines only batches of reformulated gasoline that have been
certified under this subpart;
(B) Notifies EPA prior to combining the gasolines and identifies
the exact location of the retail outlet or wholesale purchase-consumer
facility and the specific tank in which the gasolines will be combined;
(C) Retains and, upon request by EPA, makes available for
inspection product transfer documentation accounting for all gasoline
at the retail outlet or wholesale purchaser-consumer facility; and
(D) Does not combine any VOC-controlled gasoline with any non-VOC
controlled gasoline between June 1 and September 15 of each calendar
year;
(iii) A retailer or wholesale purchaser-consumer may combine
ethanol-blended reformulated gasoline with non-ethanol-blended
reformulated gasoline under paragraph (a)(8)(ii) of this section a
maximum of two periods between May 1 and September 15 of each calendar
year, each such period to extend for a period of no more than ten
consecutive calendar days. At the end of the ten-day period, the
gasoline must be in compliance with the VOC minimum standard under
Sec. 80.41.
(A) The retailer or wholesale purchaser-consumer may demonstrate
compliance with the VOC minimum standard by testing the gasoline at the
end of the ten-day period using the test methods in Sec. 80.46, where
the test results show that the gasoline meets the VOC minimum standard.
Under this option, the retailer or wholesale purchaser-consumer may add
both ethanol blended reformulated gasoline and non-ethanol blended
reformulated gasoline to the same tank an unlimited number of times
during the ten-day period; or
[[Page 8973]]
(B) The retailer or wholesale purchaser-consumer will be deemed in
compliance with the VOC minimum standard where the retailer or
wholesale purchaser-consumer draws the tank down as low as practicable
before receiving product of the other type into the tank and receives
only product of the other type into the tank during the ten-day period.
Under this option, the retailer or wholesale purchaser-consumer is not
required to test the gasoline at the end of the ten-day period.
(iv) Nothing in paragraphs (a)(8)(ii) or (iii) of this section
shall preempt existing State laws or regulations regulating the
combining of ethanol-blended reformulated gasoline with non-ethanol-
blended reformulated gasoline or prohibit a State from adopting such
laws or regulations in the future.
* * * * *
(11) * * *
(iv) * * *
(D) Paragraphs (a)(11)(iv)(A) and (C) of this section do not apply
to gasoline subject to the provisions in Sec. 80.81.
* * * * *
0
4. Section 80.79 is amended by adding paragraph (a)(5) and adding a
sentence at the end of paragraph (c)(1), to read as follows:
Sec. 80.79 Liability for violations of the prohibited activities.
(a) * * *
(5) Notwithstanding the provisions in paragraphs (a)(1) through
(a)(4) of this section, for gasoline subject to the provisions in Sec.
80.81:
(i) Only a retailer or wholesale purchaser-consumer shall be deemed
in violation for combining gasolines in a manner that is in
inconsistent with Sec. 80.78(a)(8)(ii) or (iii), or for gasoline which
does not comply with the VOC minimum standard under Sec. 80.41 after
the retailer or wholesale purchaser-consumer combines or causes the
combining of compliant gasolines in a manner inconsistent with Sec.
80.78(a)(8)(ii) or (iii);
(ii) No person shall be deemed in violation for gasoline which does
not comply with the VOC minimum standard under Sec. 80.41 where the
non-compliance is solely due to the combining of compliant gasolines by
a retailer or wholesale purchaser-consumer in a manner that is
consistent with Sec. 80.78(a)(8)(ii) and (iii).
* * * * *
(c) * * *
(1) * * * For gasoline subject to the provisions in Sec. 80.81, a
party is not required to conduct periodic sampling and testing to
determine compliance with the oxygen minimum standard.
* * * * *
0
5. Section 80.81 is amended by revising paragraphs (d), (e)(3), and
(h)(1) introductory text, and removing and reserving paragraph (e)(2)
to read as follows:
Sec. 80.81 Enforcement exemptions for California gasoline.
* * * * *
(d) Any refiner or importer that produces or imports gasoline that
is sold, intended for sale, or made available for sale as a motor
vehicle fuel in the State of California subsequent to March 1, 1996,
shall demonstrate compliance with the standards specified in Sec. Sec.
80.41 and 80.90 by excluding the volume and properties of such gasoline
from all conventional gasoline and reformulated gasoline that it
produces or imports that is not sold, intended for sale, or made
available for sale as a motor vehicle fuel in the State of California
subsequent to such date. The exemption provided in this section does
not exempt any refiner or importer from demonstrating compliance with
such standards for all gasoline that it produces or imports.
(e) * * *
(2) [Reserved]
(3)(i) Such exemption provisions shall not apply to any refiner or
importer of California gasoline who has been assessed a civil, criminal
or administrative penalty for a violation of subpart D, E or F of this
part or for a violation of the California Phase 2 reformulated gasoline
regulations set forth in Title 13, California Code of Regulations,
sections 2260 et seq., effective 90 days after the date of final agency
or district court adjudication of such penalty assessment.
(ii) Any refiner or importer subject to the provisions of paragraph
(e)(3)(i) of this section may submit a petition to the Administrator
for relief, in whole or in part, from the applicability of such
provisions, for good cause. Good cause may include a showing that the
violation for which a penalty was assessed was not a substantial
violation of the Federal California reformulated gasoline regulations.
* * * * *
(h)(1) For the purposes of the batch sampling and analysis
requirements contained in Sec. 80.65(e)(1) and Sec.
80.101(i)(1)(i)(A), any refiner or importer of California gasoline may
use a sampling and/or analysis methodology prescribed in Title 13,
California Code of Regulations, section 2260 et seq. (as amended July
2, 1996), in lieu of any applicable methodology specified in Sec.
80.46, with regards to:
* * * * *
[FR Doc. 06-1613 Filed 2-21-06; 8:45 am]
BILLING CODE 6560-50-P