Regulation of Fuels and Fuel Additives: Identification of Additional Qualifying Renewable Fuel Pathways Under the Renewable Fuel Standard Program, 462-467 [2011-31577]

Download as PDF 462 Federal Register / Vol. 77, No. 3 / Thursday, January 5, 2012 / Proposed Rules ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 80 [EPA–HQ–OAR–2011–0542; FRL–9502–1] RIN 2060–AR07 Regulation of Fuels and Fuel Additives: Identification of Additional Qualifying Renewable Fuel Pathways Under the Renewable Fuel Standard Program Environmental Protection Agency (EPA). ACTION: Proposed rule. AGENCY: EPA is issuing a proposed rule that identifies additional fuel pathways that EPA has determined meet the biomass-based diesel, advanced biofuel or cellulosic biofuel lifecycle greenhouse gas (GHG) reduction requirements specified in Clean Air Act section 211(o), the Renewable Fuel Standard Program, as amended by the Energy Independence and Security Act of 2007 (EISA). This proposed rule describes EPA’s evaluation of biofuels produced from camelina oil, energy cane, giant reed, and napiergrass; it also includes an evaluation of renewable gasoline and renewable gasoline blendstocks, as well as biodiesel from esterification, and clarifies our definition of renewable diesel. This proposed rule adds these pathways to Table in regulations as pathways which have been determined to meet one or more of the GHG reduction thresholds specified in CAA 211(o), and assigns each pathway a corresponding D-Code. It allows SUMMARY: 1 North I. Why is EPA issuing a proposed rule? This document proposes to take action to identify additional qualifying renewable fuel pathways under the Renewable Fuel Standard Program. We have published a direct final rule that NAICS 1 Codes Category Industry Industry Industry Industry Industry Industry Industry producers or importers of fuel produced pursuant to these pathways to generate Renewable Identification Numbers (RINs), providing that the fuel meets the other requirements specified in the RFS regulations to qualify it as renewable fuel. DATES: Written comments must be received by February 6, 2012. A request for a public hearing must be received by January 20, 2012. ADDRESSES: Submit your comments, identified by Docket ID No. EPA–HQ– OAR–2011–0542, by mail to Air and Radiation Docket, Docket No. EPA–HQ– OAR–2011–0542, Environmental Protection Agency, Mailcode: 6406J, 1200 Pennsylvania Ave. NW., Washington, DC 20460. Comments may also be submitted electronically or through hand delivery/courier by following the detailed instructions in the ADDRESSES section of the direct final rule located in the rules section of this Federal Register. FOR FURTHER INFORMATION CONTACT: Vincent Camobreco, Office of Transportation and Air Quality (MC6401A), Environmental Protection Agency, 1200 Pennsylvania Ave. NW., Washington, DC 20460; telephone number: (202) 564–9043; fax number: (202) 564–1686; email address: camobreco.vincent@epa.gov. SUPPLEMENTARY INFORMATION: ................................................... ................................................... ................................................... ................................................... ................................................... ................................................... ................................................... SIC 2 Codes 324110 325193 325199 424690 424710 424720 454319 2911 2869 2869 5169 5171 5172 5989 describes our rationale for identifying these additional fuel pathways, including GHG lifecycle analyses, in the ‘‘Rules and Regulations’’ section of this Federal Register because we view this as a noncontroversial action and anticipate no adverse comment. We have explained our reasons for this action in the preamble to the direct final rule. If we receive no adverse comment, we will not take further action on this proposed rule. If EPA receives relevant adverse comment or a hearing request on a distinct provision of this rulemaking, we will publish a timely withdrawal in the Federal Register indicating which portion of the rule is being withdrawn. Any distinct amendment, paragraph, or section of today’s rule not withdrawn will become effective on the date set out in the direct final rule. We will address all public comments in any subsequent final rule based on this proposed rule. We will not institute a second comment period on this action. Any parties interested in commenting must do so at this time. For further information about commenting on this rule, see the ADDRESSES section of this document. II. Does this action apply to me? Entities potentially affected by this action are those involved with the production, distribution, and sale of transportation fuels, including gasoline and diesel fuel or renewable fuels such as ethanol and biodiesel. Regulated categories and entities affected by this action include: Examples of potentially regulated entities Petroleum Refineries. Ethyl alcohol manufacturing. Other basic organic chemical manufacturing. Chemical and allied products merchant wholesalers. Petroleum bulk stations and terminals. Petroleum and petroleum products merchant wholesalers. Other fuel dealers. American Industry Classification System (NAICS). Industrial Classification (SIC) system code. emcdonald on DSK5VPTVN1PROD with PROPOSALS 2 Standard 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 VerDate Mar<15>2010 14:51 Jan 04, 2012 Jkt 226001 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. III. What should I consider as I prepare my comments for EPA? A. Submitting information claimed as CBI. Do not submit information you claim as CBI to EPA through PO 00000 Frm 00022 Fmt 4702 Sfmt 4702 www.regulations.gov or email. 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 E:\FR\FM\05JAP1.SGM 05JAP1 Federal Register / Vol. 77, No. 3 / Thursday, January 5, 2012 / Proposed Rules 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. B. Tips for Preparing Your Comments. When submitting comments, remember to: • Identify the rulemaking by docket number and other identifying information (subject heading, Federal Register date and page number). • 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. • Explain why you agree or disagree; suggest alternatives and substitute language for your requested changes. • Describe any assumptions and provide any technical information and/ or data that you used. • If you estimate potential costs or burdens, explain how you arrived at your estimate in sufficient detail to allow for it to be reproduced. • Provide specific examples to illustrate your concerns, and suggest alternatives. • Explain your views as clearly as possible, avoiding the use of profanity or personal threats. • Make sure to submit your comments by the comment period deadline identified. C. Docket Copying Costs. You may be charged a reasonable fee for photocopying docket materials, as provided in 40 CFR part 2. emcdonald on DSK5VPTVN1PROD with PROPOSALS IV. Identification of Additional Qualifying Renewable Fuel Pathways Under the Renewable Fuel Standard (RFS) Program EPA is issuing a proposed rule to identify in the RFS regulations additional renewable fuel production pathways that we have determined meet the greenhouse gas (GHG) reduction requirements of the RFS program. This proposed rule describes EPA’s evaluation of: Camelina oil (new feedstock) • Biodiesel and renewable diesel (including jet fuel and heating oil)—qualifying as biomass-based diesel and advanced biofuel. • Naphtha and liquefied petroleum gas (LPG)—qualifying as advanced biofuel. Energy cane, giant reed, and napiergrass cellulosic biomass (new feedstocks) • Ethanol, renewable diesel (including renewable jet fuel and heating oil), and naphtha— qualifying as cellulosic biofuel. VerDate Mar<15>2010 14:51 Jan 04, 2012 Jkt 226001 Renewable gasoline and renewable gasoline blendstock (new fuel types) • Produced from crop residue, slash, pre-commercial thinnings, tree residue, annual cover crops, and cellulosic components of separated yard waste, separated food waste, and separated municipal solid waste (MSW). • Using the following processes—all utilizing natural gas, biogas, and/or biomass as the only process energy sources—qualifying as cellulosic biofuel: Æ Thermochemical pyrolysis. Æ Thermochemical gasification. Æ Biochemical direct fermentation. Æ Biochemical fermentation with catalytic upgrading. Æ Any other process that uses biogas and/or biomass as the only process energy sources. Esterification (new production process) • Process used to produce biodiesel from soy bean oil, oil from annual covercrops, algal oil, biogenic waste oils/fats/greases, non-food grade corn oil, Canola/rapeseed oil, and camelina oil—qualifying as biomass-based diesel and advanced biofuel. This proposed rule adds these pathways to Table 1 to § 80.1426 and assigns each pathway one or more DCodes. Determining whether a fuel pathway satisfies the CAA’s lifecycle GHG reduction thresholds for renewable fuels requires a comprehensive evaluation of the lifecycle GHG emissions of the renewable fuel as compared to the lifecycle GHG emissions of the baseline gasoline or diesel fuel that it replaces. As mandated by CAA section 211(o), the GHG emissions assessments must evaluate the aggregate quantity of GHG emissions (including direct emissions and significant indirect emissions such as significant emissions from land use changes) related to the full fuel lifecycle, including all stages of fuel and feedstock production, distribution, and use by the ultimate consumer. In examining the full lifecycle GHG impacts of renewable fuels for the RFS program, EPA considers the following: • Feedstock production—based on agricultural sector models that include direct and indirect impacts of feedstock production. • Fuel production—including process energy requirements, impacts of any raw materials used in the process, and benefits from co-products produced. • Fuel and feedstock distribution— including impacts of transporting feedstock from production to use, and PO 00000 Frm 00023 Fmt 4702 Sfmt 4702 463 transport of the final fuel to the consumer. • Use of the fuel—including combustion emissions from use of the fuel in a vehicle. Many of the pathways evaluated in this proposal rely on a comparison to the lifecycle GHG analysis work that was done as part of the Renewable Fuel Standard Program (RFS2) Final Rule, published March 26, 2010. More information on the different pathways evaluated is included below. For additional information on our GHG lifecycle analyses for this proposal, as well as the text of the proposed regulatory changes, see the direct final rule which is located in the Rules section of this Federal Register. Camelina: Current information suggests that camelina has limited niche markets and will be produced on land that would otherwise remain fallow. Therefore, increased production of camelina-based renewable fuel is not expected to result in significant land use change emissions. For the purposes of this proposed analysis, EPA is projecting there will be no land use emissions associated with camelina production for use as a renewable fuel feedstock. Taking into account the assumption of no land use change emissions when camelina is used to produce renewable fuel, and considering that other sources of GHG emissions related to camelina biodiesel or renewable diesel production have comparable GHG emissions to biodiesel from soybean oil, we are proposing that camelina-based biodiesel and renewable diesel should be treated in the same manner as soybased biodiesel and renewable diesel in qualifying as biomass-based diesel and advanced biofuel for purposes of RIN generation since the GHG emission performance of the camelina-based fuels will be at least as good and in some respects better than that modeled for fuels made from soybean oil. EPA found as part of the Renewable Fuel Standard final rulemaking that soybean biodiesel resulted in a 57% reduction in GHG emissions compared to the baseline petroleum diesel fuel. Furthermore, approximately 80% of the lifecycle impacts from soybean biodiesel were from land use change emissions which are assumed to be not significant for the camelina pathway considered. Thus, EPA is proposing to include camelina oil as a potential feedstock under the same biodiesel and renewable diesel pathways for which soybean oil currently qualifies. We are also proposing to include a pathway for jet fuel, naphtha, and LPG produced from camelina oil through hydrotreating. This E:\FR\FM\05JAP1.SGM 05JAP1 emcdonald on DSK5VPTVN1PROD with PROPOSALS 464 Federal Register / Vol. 77, No. 3 / Thursday, January 5, 2012 / Proposed Rules is based on the fact that our analysis shows that even when all of the coproducts are used to generate RINs the lifecycle GHG emissions for RINgenerating co-products including diesel replacement fuel, jet fuel, naphtha and LPG produced from camelina oil will all meet the 50% GHG emissions reduction threshold. We are also proposing that two existing pathways for RIN generation in the RFS regulations that list ‘‘renewable diesel’’ as a fuel product produced through a hydrotreating process include jet fuel. This applies to two pathways in Table 1 to § 80.1426 of the RFS regulations which both list renewable diesel made from soy bean oil, oil from annual covercrops, algal oil, biogenic waste oils/fats/greases, or non-food grade corn oil using hydrotreating as a process. We are proposing that if parties produce jet fuel from the hydrotreating process and co-process renewable biomass and petroleum they can generate advanced biofuel RINs (D code 5) for the jet fuel produced. We are also proposing that if they do not co-process renewable biomass and petroleum they can generate biomass-based diesel RINs (D code 4) for the jet fuel produced. § 80.1401 of the RFS regulations currently defines non-ester renewable diesel as a fuel that is not a mono-alkyl ester and which can be used in an engine designed to operate on conventional diesel fuel or be heating oil or jet fuel. The reference to jet fuel in this definition was added by direct final rule dated May 10, 2010. Table 1 to § 80.1426 identifies approved fuel pathways by fuel type, feedstock source and fuel production processes. The table, which was largely adopted as part of the March 26, 2010 RFS2 final rule, identifies jet fuel and renewable diesel as separate fuel types. Accordingly, in light of the revised definition of renewable diesel enacted after the RFS2 rule, there is ambiguity regarding the extent to which references in Table 1 to ‘‘renewable diesel’’ include jet fuel. The original lifecycle analysis for the renewable diesel from hydrotreating pathways listed in Table 1 to § 80.1426 was not based on producing jet fuel but rather other transportation diesel fuel products, namely a diesel fuel replacement. As discussed in the direct final rule, the hydrotreating process can produce a mix of products including jet fuel, diesel, naphtha, LPG and propane. Also, as discussed, there are differences in the process configured for maximum jet fuel production vs. the process maximized for diesel fuel production and the lifecycle results vary depending on what approach is used to consider VerDate Mar<15>2010 14:51 Jan 04, 2012 Jkt 226001 co-products (i.e., the allocation or displacement approach). In cases where there are no pathways for generating RINs for the co-products from the hydrotreating process it would be appropriate to use the displacement method for capturing the credits of coproducts produced. This is the case for most of the original feedstocks included in Table 1 to § 80.1426. If the displacement approach is used when jet fuel is the primary product produced it results in lower emissions then the production maximized for diesel fuel production. Therefore, since the hydrotreating process maximized for diesel fuel meets the 50% lifecycle GHG threshold for the feedstocks in question, the process maximized for jet fuel would also qualify. Thus, we are proposing that the references to ‘‘renewable diesel’’ in Table 1 include jet fuel, consistent with our regulatory definition of ‘‘non-ester renewable diesel,’’ since doing so clarifies the existing regulations while ensuring that Table 1 to § 80.1426 appropriately identifies fuel pathways that meet the GHG reduction thresholds associated with each pathway. We note that although the definition of renewable diesel includes jet fuel and heating oil, we are also proposing to list in Table 1 of section 80.1426 of the RFS2 regulations jet fuel and heating oil as specific co-products in addition to listing renewable diesel to assure clarity. This clarification also pertains to all the feedstocks already included in Table 1 for renewable diesel. Energy grasses: Based on our comparison of switchgrass and the three feedstocks considered here, EPA is proposing that cellulosic biofuel produced from the cellulose, hemicellulose and lignin portions of energy cane, giant reed, and napiergrass has similar or better lifecycle GHG impacts than biofuel produced from the cellulosic biomass from switchgrass. Our proposed analysis suggests that the three feedstocks considered have GHG impacts associated with growing and harvesting the feedstock that are similar to switchgrass. Emissions from growing and harvesting energy cane are approximately 4 kg CO2eq/mmBtu higher than switchgrass, emissions from growing and harvesting giant reed are approximately 2 kg CO2eq/mmBtu lower than switchgrass, and emissions from growing and harvesting napiergrass are approximately 6 kg CO2eq/mmBtu higher than switchgrass. These are small changes in the overall lifecycle, representing at most a 6% change in the energy grass lifecycle impacts in comparison to the petroleum fuel baseline. Furthermore, the three PO 00000 Frm 00024 Fmt 4702 Sfmt 4702 feedstocks considered are expected to have similar or lower GHG emissions than switchgrass associated with other components of the biofuel lifecycle. As a hypothetical worst case, if the calculated increases in growing and harvesting the new feedstocks are incorporated into the lifecycle GHG emissions calculated for switchgrass, and other lifecycle components are projected as having similar GHG impacts to switchgrass (including land use change associated with switchgrass production), the overall lifecycle GHG reductions for biofuel produced from energy cane, giant reed, and napiergrass still meet the 60% reduction threshold for cellulosic biofuel, the lowest being a 64% reduction (for napiergrass F–T diesel) compared to the petroleum baseline. We believe these are conservative estimates, as use of energy cane, giant reed, or napiergrass as a feedstock is expected to have smaller land-use GHG impacts than switchgrass, due to their higher yields. Although this analysis assumes energy cane, giant reed, and napiergrass biofuels produced for sale and use in the United States will most likely come from domestically produced feedstock, we also intend for the proposed pathways to cover energy cane, giant reed, and napiergrass from other countries. We do not expect incidental amounts of biofuels from feedstocks produced in other nations to impact our average GHG emissions. Moreover, other countries most likely to be exporting energy cane, giant reed, or napiergrass or biofuels produced from these feedstocks are likely to be major producers which typically use similar cultivars and farming techniques. Therefore, GHG emissions from producing biofuels with energy cane, giant reed, or napiergrass grown in other countries should be similar to the GHG emissions we estimated for U.S. energy cane, giant reed, or napiergrass, though they could be slightly (and insignificantly) higher or lower. For example, the renewable biomass provisions under the Energy Independence and Security Act would prohibit direct conversion of previously unfarmed land in other countries into cropland for energy grass-based renewable fuel production. Furthermore, any energy grass production on existing cropland internationally would not be expected to have land use impacts beyond what was considered for switchgrass production. Even if there were unexpected larger differences, EPA believes the small amounts of feedstock or fuel potentially coming from other E:\FR\FM\05JAP1.SGM 05JAP1 emcdonald on DSK5VPTVN1PROD with PROPOSALS Federal Register / Vol. 77, No. 3 / Thursday, January 5, 2012 / Proposed Rules countries will not impact our threshold analysis. Based on our assessment of switchgrass in the RFS2 final rule and this comparison of GHG emissions from switchgrass and energy cane, giant reed, and napiergrass, we do not expect variations to be large enough to bring the overall GHG impact of fuel made from energy cane, giant reed or napier grass to come close to the 60% threshold for cellulosic biofuel. Therefore, EPA is proposing to include cellulosic biofuel produced from the cellulose, hemicelluloses and lignin portions of energy cane, giant reed, and napiergrass under the same pathways for which cellulosic biomass from switchgrass qualifies under the RFS2 final rule. Renewable gasoline and renewable gasoline blendstock: Three renewable gasoline and renewable gasoline blendstock pathways were compared to baseline petroleum gasoline, using the same value for baseline gasoline as in the RFS2 final rule analysis. The results of the proposed analysis indicate that the renewable gasoline and renewable gasoline blendstock pathways result in a GHG emissions reduction of 65–129% or better compared to the gasoline fuel it would replace using corn stover as a feedstock. Since the renewable gasoline and renewable gasoline blendstock pathways which use corn stover as a feedstock all exceed the 60% lifecycle GHG threshold requirements for cellulosic biofuel, and since these pathways capture the likely current technologies and since future technology improvements are likely to increase efficiency and lower GHG emissions, we are proposing that all processes producing renewable gasoline or renewable gasoline blendstock from corn stover can qualify if they fall in the following process characterizations: • Catalytic pyrolysis and upgrading utilizing natural gas, biogas, and/or biomass as the only process energy sources. • Gasification and upgrading utilizing natural gas, biogas, and/or biomass as the only process energy sources. • Direct fermentation utilizing natural gas, biogas, and/or biomass as the only process energy sources. • Fermentation and upgrading utilizing natural gas, biogas, and/or biomass as the only process energy sources. • Any process utilizing biogas and/or biomass as the only process energy sources. As was the case for extending corn stover results to other feedstocks in the RFS2 final rule, we are proposing to extend these results to feedstocks with VerDate Mar<15>2010 14:51 Jan 04, 2012 Jkt 226001 similar or lower GHG emissions profiles, including the following feedstocks: • Cellulosic biomass from crop residue, slash, pre-commercial thinnings and tree residue, annual cover crops; • Cellulosic components of separated yard waste; • Cellulosic components of separated food waste; and • Cellulosic components of separated MSW. For more information on the reasoning for extension to these other feedstocks refer to the feedstock production and distribution section or the RFS2 rulemaking (75 FR 14793– 14795). Based on these results, today’s proposed rule includes pathways for the generation of cellulosic biofuel RINs for renewable gasoline or renewable gasoline blendstock produced by catalytic pyrolysis and upgrading, gasification and upgrading, direct fermentation, fermentation and upgrading, all utilizing natural gas, biogas, and/or biomass as the only onsite process energy sources or any process utilizing biogas and/or biomass as the only on-site energy sources, and using corn stover as a feedstock or the feedstocks noted above. In order to qualify for RIN generation, the fuel must meet the other definitional criteria for renewable fuel (e.g., produced from renewable biomass, and used to reduce or replace petroleum-based transportation fuel, heating oil or jet fuel) specified in the Clean Air Act and the RFS regulations. Direct Esterification: Using the same methodology as was used for the yellow grease modeling under RFS2, but using high energy and materials use assumptions and omitting the glycerin co-product credit, we estimate the GHG emissions reduction for the esterification of specified feedstocks with any level of FFA process is ¥71%. Since the GHG threshold is at ¥50% for biomass-based diesel and advanced biofuel, we believe that there is a large enough margin in the results to reasonably conclude that biodiesel using esterification of specified feedstocks with any level of FFA content meets the biomass-based diesel and advanced biofuel 50% lifecycle GHG reduction threshold. Therefore, we are proposing to include the process ‘‘esterification’’ as an approved biodiesel production process in Table 1 to § 40 CFR 80.1426. In addition, consistent with the modeling conducted for RFS2, we are proposing to interpret the RFS regulations as they existed prior to today’s rule as including a direct PO 00000 Frm 00025 Fmt 4702 Sfmt 4702 465 esterification process as part of the biodiesel pathways for which only ‘‘trans-esterification’’ was specifically referenced in Table 1 to § 40 CFR 80.1426. V. Additional Changes to Listing of Available Pathways in Table 1 of 80.1426 We are also proposing two changes to Table 1 to 80.1426 that were proposed on July 1, 2011 (76 FR 38844). The first change adds ID letters to pathways to facilitate references to specific pathways. The second change adds ‘‘rapeseed’’ to the existing pathway for renewable fuel made from canola oil. On September 28, 2010, EPA published a ‘‘Supplemental Determination for Renewable Fuels Produced Under the Final RFS2 Program from Canola Oil’’ (FR Vol. 75, No. 187, pg 59622–59634). In the July 1, 2011 NPRM (76 FR 38844) we proposed to clarify two aspects of the supplemental determination. First we proposed to amend the regulatory language in Table 1 to § 80.1426 to clarify that the currently-approved pathway for canola also applies more generally to rapeseed. While ‘‘canola’’ was specifically described as the feedstock evaluated in the supplemental determination, we had not intended the supplemental determination to cover just those varieties or sources of rapeseed that are identified as canola, but to all rapeseed. As described in the July 1, 2011 NPRM, we currently interpret the reference to ‘‘canola’’ in Table 1 to § 80.1426 to include any rapeseed. To eliminate ambiguity caused by the current language, however, we proposed to replace the term ‘‘canola’’ in that table with the term ‘‘canola/rapeseed’’. Canola is a type of rapeseed. While the term ‘‘canola’’ is often used in the American continent and in Australia, the term ‘‘rapeseed’’ is often used in Europe and other countries to describe the same crop. We received no adverse comments on our July 1, 2011 proposal but are reproposing it here in case we receive adverse comment in response to the direct final rule also published today. Second, we wish to clarify that although the GHG emissions of producing fuels from canola feedstock grown in the U.S. and Canada was specifically modeled as the most likely source of canola (or rapeseed) oil used for biodiesel produced for sale and use in the U.S., we also intended that the approved pathway cover canola/ rapeseed oil from other countries, and we propose to interpret our regulations in that manner. We expect the vast majority of biodiesel used in the U.S. E:\FR\FM\05JAP1.SGM 05JAP1 466 Federal Register / Vol. 77, No. 3 / Thursday, January 5, 2012 / Proposed Rules VI. Statutory and Executive Order Reviews A. Executive Order 12866: Regulatory Planning and Review This action is not a ‘‘significant regulatory action’’ under the terms of Executive Order 12866 (58 FR 51735, October 4, 1993) and is therefore not subject to review under Executive Orders 12866 and 13563 (76 FR 3821, January 21, 2011). enterprise which is independently owned and operated and is not dominant in its field. After considering the economic impacts of this action on small entities, I certify that this proposed rule will not have a significant economic impact on a substantial number of small entities. This proposed rule will not impose any new requirements on small entities. The relatively minor corrections and modifications this proposed rule makes to the final RFS2 regulations do not impact small entities. We continue to be interested in the potential impacts of the rule on small entities and welcome comments on issues related to such impacts. F. Executive Order 13175 (Consultation and Coordination With Indian Tribal Governments) This proposed rule does not have tribal implications, as specified in Executive Order 13175 (65 FR 67249, November 9, 2000). It applies to gasoline, diesel, and renewable fuel producers, importers, distributors and marketers. This action makes relatively minor corrections and modifications to the RFS regulations, and does not impose any enforceable duties on communities of Indian tribal governments. Thus, Executive Order 13175 does not apply to this action. Nonetheless, EPA specifically solicits additional comment on this proposed action from tribal officials. D. Unfunded Mandates Reform Act and produced from canola/rapeseed oil will come from U.S. and Canadian crops. Incidental amounts from crops produced in other nations will not impact our average GHG emissions. Therefore, EPA proposes to interpret the approved canola pathway as covering canola/rapeseed regardless of country origin. G. Executive Order 13045: Protection of Children From Environmental Health Risks and Safety Risks EPA interprets EO 13045 (62 FR 19885, April 23, 1997) as applying only to those regulatory actions that concern health or safety risks, such that the analysis required under section 5–501 of the EO has the potential to influence the regulation. This action is not subject to EO 13045 because it does not establish an environmental standard intended to mitigate health or safety risks. This action does not impose any new information collection burden. The corrections, clarifications, and modifications to the final RFS2 regulations contained in this rule are within the scope of the information collection requirements submitted to the Office of Management and Budget (OMB) for the final RFS2 regulations. OMB has approved the information collection requirements contained in the existing regulations at 40 CFR part 80, subpart M under the provisions of the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. and has assigned OMB control numbers 2060–0637 and 2060– 0640. The OMB control numbers for EPA’s regulations in 40 CFR are listed in 40 CFR part 9. This proposed rule does not contain a Federal mandate that may result in expenditures of $100 million or more for State, local, and tribal governments, in the aggregate, or the private sector in any one year. We have determined that this action will not result in expenditures of $100 million or more for the above parties and thus, this rule is not subject to the requirements of sections 202 or 205 of UMRA. This proposed rule is also not subject to the requirements of section 203 of UMRA because it contains no regulatory requirements that might significantly or uniquely affect small governments. It only applies to gasoline, diesel, and renewable fuel producers, importers, distributors and marketers and makes relatively minor corrections and modifications to the RFS2 regulations. C. Regulatory Flexibility Act E. Executive Order 13132 (Federalism) 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 Procedure 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 (SBA) 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 This action 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 action only applies to gasoline, diesel, and renewable fuel producers, importers, distributors and marketers and makes relatively minor corrections and modifications to the RFS2 regulations. Thus, Executive Order 13132 does not apply to this action. In the spirit of Executive Order 13132, and consistent with EPA policy to promote communications between EPA and State and local governments, EPA specifically solicits comment on this proposed action from State and local officials. emcdonald on DSK5VPTVN1PROD with PROPOSALS B. Paperwork Reduction Act VerDate Mar<15>2010 14:51 Jan 04, 2012 Jkt 226001 PO 00000 Frm 00026 Fmt 4702 Sfmt 4702 H. Executive Order 13211: Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use This proposed rule is not subject to Executive Order 13211 (66 FR 18355 (May 22, 2001)), because it is not a significant regulatory action under Executive Order 12866. 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, 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. NTTAA directs EPA to provide Congress, through OMB, explanations when the Agency decides not to use available and applicable voluntary consensus standards. This action does not involve technical standards. Therefore, EPA did not consider the use of any voluntary consensus standards. E:\FR\FM\05JAP1.SGM 05JAP1 Federal Register / Vol. 77, No. 3 / Thursday, January 5, 2012 / Proposed Rules J. Executive Order 12898: Federal Actions To Address Environmental Justice in Minority Populations and Low-Income Populations DEPARTMENT OF HEALTH AND HUMAN SERVICES Administration for Children and Families Executive Order (EO) 12898 (59 FR 7629 (Feb. 16, 1994)) establishes Federal executive policy on environmental justice. Its main provision directs Federal agencies, to the greatest extent practicable and permitted by law, to make environmental justice part of their mission by identifying and addressing, as appropriate, disproportionately high and adverse human health or environmental effects of their programs, policies, and activities on minority populations and low-income populations in the United States. EPA has determined that this proposed rule will not have disproportionately high and adverse human health or environmental effects on minority or low-income populations because it does not affect the level of protection provided to human health or the environment. These amendments would not relax the control measures on sources regulated by the RFS regulations and therefore would not cause emissions increases from these sources. Notice of Tribal Consultation Meetings Regarding How the Current SACWIS Regulations Affect Tribes Administering a Title IV–E Program AGENCY: Children’s Bureau, ACYF, ACF, HHS. ACTION: Notice of Tribal Consultation. [FR Doc. 2011–31577 Filed 1–4–12; 8:45 am] Title IV–E rules provide Federal Financial Participation (FFP) through a beneficial cost allocation methodology if a State or Tribe implements a comprehensive Statewide Automated Child Welfare Information System (SACWIS) to track and manage child protection, foster care and adoption assistance activities. With the continuing implementation of the Fostering Connections to Success and Increasing Adoptions Act of 2008 (Pub. L. 110–351) we wish to analyze the impact of the State-centric SACWIS rules on Tribes and Tribal child welfare agencies, to determine if Tribes have sufficient flexibility and latitude to build information systems that will meet their business needs. The Children’s Bureau’s (CB) Division of State Systems (DSS) has been assigned responsibility to undertake consultation with Tribes in this area. To offer Tribes the opportunity for informed comment on the implications that the State-centric rules have on their ability to build and operate information systems that will support their title IV– E programs, we will provide an education session on the SACWIS regulations. This will be followed by a consultation to listen to the concerns and ideas from Tribal leaders and their representatives about the existing SACWIS rules and how CB can support title IV–E Tribal agencies in building information systems that will meet their business needs. We propose two such combined meetings via teleconferences to reach a broad audience of interested parties. The teleconference on February 15, 2012, is intended for consultation with Tribal leaders; the teleconference on February 16, 2012, is intended to engage in consultation with their representatives. BILLING CODE 6560–50–P DATES: VII. Statutory Provisions and Legal Authority Statutory authority for the rule finalized today can be found in section 211 of the Clean Air Act, 42 U.S.C. 7545. Additional support for the procedural and compliance related aspects of today’s rule, including the recordkeeping requirements, come from Sections 114, 208, and 301(a) of the Clean Air Act, 42 U.S.C. 7414, 7542, and 7601(a). List of Subjects in 40 CFR Part 80 Environmental protection, Administrative practice and procedure, Agriculture, Air pollution control, Confidential business information, Diesel Fuel, Energy, Forest and Forest Products, Fuel additives, Gasoline, Imports, Labeling, Motor vehicle pollution, Penalties, Petroleum, Reporting and recordkeeping requirements. emcdonald on DSK5VPTVN1PROD with PROPOSALS 45 CFR Part 1355 Dated: November 30, 2011. Lisa P. Jackson, Administrator. VerDate Mar<15>2010 14:51 Jan 04, 2012 SUMMARY: The meeting dates and times for teleconferences are: • February 15, from 1–3 p.m. EST. • February 16, from 3–5 p.m. EST. Jkt 226001 PO 00000 Frm 00027 Fmt 4702 Sfmt 4702 467 Access information for these teleconferences is in the Supplementary Information section. Written comments must be submitted to the office listed in the ADDRESSES section below on or before April 6, 2012. You may submit written comments about this topic by any of the following methods: • Federal eRulemaking Portal: https:// www.regulations.gov. Follow the instructions for submitting comments. • Email: DSSComments@acf.hhs.gov. Please include ‘‘Comments on Tribal Consultation’’ in the subject line of the message. • Mail or Courier Delivery: Terry Watt, Director, Division of State Systems, Children’s Bureau, Administration on Children, Youth and Families, Administration for Children and Families, 1250 Maryland Avenue SW., 8th Floor, Washington, DC 20024. If you choose to use an express, overnight, or other special delivery method, please verify first that they are able to deliver to the above address during the normal workweek. We encourage you to submit comments electronically so that they are received in a timely manner. All comments received will be posted without change to https://www.regulations.gov including any personal information provided. Written comments and comments provided during consultation will receive equal consideration by CB. FOR FURTHER INFORMATION CONTACT: If you have questions about this process, or want further information about current Federal regulations governing child welfare automation, please contact Mr. Peter Howe, John F. Kennedy Federal Building, Room 2000 West, 15 New Sudbury Street, Boston, MA 02203; voice: (617) 565–1515; by email at: peter.howe@acf.hhs.gov. ADDRESSES: SUPPLEMENTARY INFORMATION: Teleconferences: The teleconference on February 15, 2012 at 1 p.m. EST is reserved for Tribal leaders; the teleconference on February 16, 2012 at 3 p.m. EST is intended for their representatives. Access information for these teleconferences is as follows: February 15 call in: (888) 989–8183; Password: 368–9268. February 16 call in: (888) 673–9785; Password: 621–8061. The teleconferences will be recorded, and a summary of the content will be published within 45 days of the February 16, 2012 call. SACWIS Background: Sections 474(a)(3)(C) and (D) of the Social Security Act (the Act) provide States, E:\FR\FM\05JAP1.SGM 05JAP1

Agencies

ENVIRONMENTAL PROTECTION AGENCY

[Federal Register Volume 77, Number 3 (Thursday, January 5, 2012)]
[Proposed Rules]
[Pages 462-467]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-31577]

[[Page 462]]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 80

[EPA-HQ-OAR-2011-0542; FRL-9502-1]
RIN 2060-AR07

Regulation of Fuels and Fuel Additives: Identification of
Additional Qualifying Renewable Fuel Pathways Under the Renewable Fuel
Standard Program

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

-----------------------------------------------------------------------

SUMMARY: EPA is issuing a proposed rule that identifies additional fuel
pathways that EPA has determined meet the biomass-based diesel,
advanced biofuel or cellulosic biofuel lifecycle greenhouse gas (GHG)
reduction requirements specified in Clean Air Act section 211(o), the
Renewable Fuel Standard Program, as amended by the Energy Independence
and Security Act of 2007 (EISA). This proposed rule describes EPA's
evaluation of biofuels produced from camelina oil, energy cane, giant
reed, and napiergrass; it also includes an evaluation of renewable
gasoline and renewable gasoline blendstocks, as well as biodiesel from
esterification, and clarifies our definition of renewable diesel.
This proposed rule adds these pathways to Table in regulations as
pathways which have been determined to meet one or more of the GHG
reduction thresholds specified in CAA 211(o), and assigns each pathway
a corresponding D-Code. It allows producers or importers of fuel
produced pursuant to these pathways to generate Renewable
Identification Numbers (RINs), providing that the fuel meets the other
requirements specified in the RFS regulations to qualify it as
renewable fuel.

DATES: Written comments must be received by February 6, 2012. A request
for a public hearing must be received by January 20, 2012.

ADDRESSES: Submit your comments, identified by Docket ID No. EPA-HQ-
OAR-2011-0542, by mail to Air and Radiation Docket, Docket No. EPA-HQ-
OAR-2011-0542, Environmental Protection Agency, Mailcode: 6406J, 1200
Pennsylvania Ave. NW., Washington, DC 20460. Comments may also be
submitted electronically or through hand delivery/courier by following
the detailed instructions in the ADDRESSES section of the direct final
rule located in the rules section of this Federal Register.

FOR FURTHER INFORMATION CONTACT: Vincent Camobreco, Office of
Transportation and Air Quality (MC6401A), Environmental Protection
Agency, 1200 Pennsylvania Ave. NW., Washington, DC 20460; telephone
number: (202) 564-9043; fax number: (202) 564-1686; email address:
camobreco.vincent@epa.gov.

SUPPLEMENTARY INFORMATION:

I. Why is EPA issuing a proposed rule?

This document proposes to take action to identify additional
qualifying renewable fuel pathways under the Renewable Fuel Standard
Program. We have published a direct final rule that describes our
rationale for identifying these additional fuel pathways, including GHG
lifecycle analyses, in the ``Rules and Regulations'' section of this
Federal Register because we view this as a noncontroversial action and
anticipate no adverse comment. We have explained our reasons for this
action in the preamble to the direct final rule.
If we receive no adverse comment, we will not take further action
on this proposed rule. If EPA receives relevant adverse comment or a
hearing request on a distinct provision of this rulemaking, we will
publish a timely withdrawal in the Federal Register indicating which
portion of the rule is being withdrawn. Any distinct amendment,
paragraph, or section of today's rule not withdrawn will become
effective on the date set out in the direct final rule. We will address
all public comments in any subsequent final rule based on this proposed
rule. We will not institute a second comment period on this action. Any
parties interested in commenting must do so at this time. For further
information about commenting on this rule, see the ADDRESSES section of
this document.

II. Does this action apply to me?

Entities potentially affected by this action are those involved
with the production, distribution, and sale of transportation fuels,
including gasoline and diesel fuel or renewable fuels such as ethanol
and biodiesel. Regulated categories and entities affected by this
action include:

----------------------------------------------------------------------------------------------------------------
NAICS \1\ Examples of potentially regulated
Category Codes SIC \2\ Codes entities
----------------------------------------------------------------------------------------------------------------
Industry................................... 324110 2911 Petroleum Refineries.
Industry................................... 325193 2869 Ethyl alcohol manufacturing.
Industry................................... 325199 2869 Other basic organic chemical
Industry................................... 424690 5169 manufacturing.
Industry................................... 424710 5171 Chemical and allied products
Industry................................... 424720 5172 merchant wholesalers.
Industry................................... 454319 5989 Petroleum bulk stations and
terminals.
Petroleum and petroleum products
merchant wholesalers.
Other fuel dealers.
----------------------------------------------------------------------------------------------------------------
\1\ North American Industry Classification System (NAICS).
\2\ 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.

III. What should I consider as I prepare my comments for EPA?

A. Submitting information claimed as CBI. Do not submit information
you claim as CBI to EPA through www.regulations.gov or email. 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

[[Page 463]]

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.
B. Tips for Preparing Your Comments. When submitting comments,
remember to:
Identify the rulemaking by docket number and other
identifying information (subject heading, Federal Register date and
page number).
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.
Explain why you agree or disagree; suggest alternatives
and substitute language for your requested changes.
Describe any assumptions and provide any technical
information and/or data that you used.
If you estimate potential costs or burdens, explain how
you arrived at your estimate in sufficient detail to allow for it to be
reproduced.
Provide specific examples to illustrate your concerns, and
suggest alternatives.
Explain your views as clearly as possible, avoiding the
use of profanity or personal threats.
Make sure to submit your comments by the comment period
deadline identified.
C. Docket Copying Costs. You may be charged a reasonable fee for
photocopying docket materials, as provided in 40 CFR part 2.

IV. Identification of Additional Qualifying Renewable Fuel Pathways
Under the Renewable Fuel Standard (RFS) Program

EPA is issuing a proposed rule to identify in the RFS regulations
additional renewable fuel production pathways that we have determined
meet the greenhouse gas (GHG) reduction requirements of the RFS
program. This proposed rule describes EPA's evaluation of:

Camelina oil (new feedstock)
Biodiesel and renewable diesel (including jet fuel and
heating oil)--qualifying as biomass-based diesel and advanced biofuel.
Naphtha and liquefied petroleum gas (LPG)--qualifying as
advanced biofuel.
Energy cane, giant reed, and napiergrass cellulosic biomass (new
feedstocks)
Ethanol, renewable diesel (including renewable jet fuel
and heating oil), and naphtha--qualifying as cellulosic biofuel.
Renewable gasoline and renewable gasoline blendstock (new fuel types)
Produced from crop residue, slash, pre-commercial
thinnings, tree residue, annual cover crops, and cellulosic components
of separated yard waste, separated food waste, and separated municipal
solid waste (MSW).
Using the following processes--all utilizing natural gas,
biogas, and/or biomass as the only process energy sources--qualifying
as cellulosic biofuel:
[cir] Thermochemical pyrolysis.
[cir] Thermochemical gasification.
[cir] Biochemical direct fermentation.
[cir] Biochemical fermentation with catalytic upgrading.
[cir] Any other process that uses biogas and/or biomass as the only
process energy sources.
Esterification (new production process)
Process used to produce biodiesel from soy bean oil, oil
from annual covercrops, algal oil, biogenic waste oils/fats/greases,
non-food grade corn oil, Canola/rapeseed oil, and camelina oil--
qualifying as biomass-based diesel and advanced biofuel.

This proposed rule adds these pathways to Table 1 to Sec. 80.1426
and assigns each pathway one or more D-Codes.
Determining whether a fuel pathway satisfies the CAA's lifecycle
GHG reduction thresholds for renewable fuels requires a comprehensive
evaluation of the lifecycle GHG emissions of the renewable fuel as
compared to the lifecycle GHG emissions of the baseline gasoline or
diesel fuel that it replaces. As mandated by CAA section 211(o), the
GHG emissions assessments must evaluate the aggregate quantity of GHG
emissions (including direct emissions and significant indirect
emissions such as significant emissions from land use changes) related
to the full fuel lifecycle, including all stages of fuel and feedstock
production, distribution, and use by the ultimate consumer.
In examining the full lifecycle GHG impacts of renewable fuels for
the RFS program, EPA considers the following:
Feedstock production--based on agricultural sector models
that include direct and indirect impacts of feedstock production.
Fuel production--including process energy requirements,
impacts of any raw materials used in the process, and benefits from co-
products produced.
Fuel and feedstock distribution--including impacts of
transporting feedstock from production to use, and transport of the
final fuel to the consumer.
Use of the fuel--including combustion emissions from use
of the fuel in a vehicle.
Many of the pathways evaluated in this proposal rely on a
comparison to the lifecycle GHG analysis work that was done as part of
the Renewable Fuel Standard Program (RFS2) Final Rule, published March
26, 2010.
More information on the different pathways evaluated is included
below. For additional information on our GHG lifecycle analyses for
this proposal, as well as the text of the proposed regulatory changes,
see the direct final rule which is located in the Rules section of this
Federal Register.
Camelina: Current information suggests that camelina has limited
niche markets and will be produced on land that would otherwise remain
fallow. Therefore, increased production of camelina-based renewable
fuel is not expected to result in significant land use change
emissions. For the purposes of this proposed analysis, EPA is
projecting there will be no land use emissions associated with camelina
production for use as a renewable fuel feedstock.
Taking into account the assumption of no land use change emissions
when camelina is used to produce renewable fuel, and considering that
other sources of GHG emissions related to camelina biodiesel or
renewable diesel production have comparable GHG emissions to biodiesel
from soybean oil, we are proposing that camelina-based biodiesel and
renewable diesel should be treated in the same manner as soy-based
biodiesel and renewable diesel in qualifying as biomass-based diesel
and advanced biofuel for purposes of RIN generation since the GHG
emission performance of the camelina-based fuels will be at least as
good and in some respects better than that modeled for fuels made from
soybean oil. EPA found as part of the Renewable Fuel Standard final
rulemaking that soybean biodiesel resulted in a 57% reduction in GHG
emissions compared to the baseline petroleum diesel fuel. Furthermore,
approximately 80% of the lifecycle impacts from soybean biodiesel were
from land use change emissions which are assumed to be not significant
for the camelina pathway considered. Thus, EPA is proposing to include
camelina oil as a potential feedstock under the same biodiesel and
renewable diesel pathways for which soybean oil currently qualifies. We
are also proposing to include a pathway for jet fuel, naphtha, and LPG
produced from camelina oil through hydrotreating. This

[[Page 464]]

is based on the fact that our analysis shows that even when all of the
co-products are used to generate RINs the lifecycle GHG emissions for
RIN-generating co-products including diesel replacement fuel, jet fuel,
naphtha and LPG produced from camelina oil will all meet the 50% GHG
emissions reduction threshold.
We are also proposing that two existing pathways for RIN generation
in the RFS regulations that list ``renewable diesel'' as a fuel product
produced through a hydrotreating process include jet fuel. This applies
to two pathways in Table 1 to Sec. 80.1426 of the RFS regulations
which both list renewable diesel made from soy bean oil, oil from
annual covercrops, algal oil, biogenic waste oils/fats/greases, or non-
food grade corn oil using hydrotreating as a process. We are proposing
that if parties produce jet fuel from the hydrotreating process and co-
process renewable biomass and petroleum they can generate advanced
biofuel RINs (D code 5) for the jet fuel produced. We are also
proposing that if they do not co-process renewable biomass and
petroleum they can generate biomass-based diesel RINs (D code 4) for
the jet fuel produced.
Sec. 80.1401 of the RFS regulations currently defines non-ester
renewable diesel as a fuel that is not a mono-alkyl ester and which can
be used in an engine designed to operate on conventional diesel fuel or
be heating oil or jet fuel. The reference to jet fuel in this
definition was added by direct final rule dated May 10, 2010. Table 1
to Sec. 80.1426 identifies approved fuel pathways by fuel type,
feedstock source and fuel production processes. The table, which was
largely adopted as part of the March 26, 2010 RFS2 final rule,
identifies jet fuel and renewable diesel as separate fuel types.
Accordingly, in light of the revised definition of renewable diesel
enacted after the RFS2 rule, there is ambiguity regarding the extent to
which references in Table 1 to ``renewable diesel'' include jet fuel.
The original lifecycle analysis for the renewable diesel from
hydrotreating pathways listed in Table 1 to Sec. 80.1426 was not based
on producing jet fuel but rather other transportation diesel fuel
products, namely a diesel fuel replacement. As discussed in the direct
final rule, the hydrotreating process can produce a mix of products
including jet fuel, diesel, naphtha, LPG and propane. Also, as
discussed, there are differences in the process configured for maximum
jet fuel production vs. the process maximized for diesel fuel
production and the lifecycle results vary depending on what approach is
used to consider co-products (i.e., the allocation or displacement
approach).
In cases where there are no pathways for generating RINs for the
co-products from the hydrotreating process it would be appropriate to
use the displacement method for capturing the credits of co-products
produced. This is the case for most of the original feedstocks included
in Table 1 to Sec. 80.1426. If the displacement approach is used when
jet fuel is the primary product produced it results in lower emissions
then the production maximized for diesel fuel production. Therefore,
since the hydrotreating process maximized for diesel fuel meets the 50%
lifecycle GHG threshold for the feedstocks in question, the process
maximized for jet fuel would also qualify.
Thus, we are proposing that the references to ``renewable diesel''
in Table 1 include jet fuel, consistent with our regulatory definition
of ``non-ester renewable diesel,'' since doing so clarifies the
existing regulations while ensuring that Table 1 to Sec. 80.1426
appropriately identifies fuel pathways that meet the GHG reduction
thresholds associated with each pathway.
We note that although the definition of renewable diesel includes
jet fuel and heating oil, we are also proposing to list in Table 1 of
section 80.1426 of the RFS2 regulations jet fuel and heating oil as
specific co-products in addition to listing renewable diesel to assure
clarity. This clarification also pertains to all the feedstocks already
included in Table 1 for renewable diesel.
Energy grasses: Based on our comparison of switchgrass and the
three feedstocks considered here, EPA is proposing that cellulosic
biofuel produced from the cellulose, hemicellulose and lignin portions
of energy cane, giant reed, and napiergrass has similar or better
lifecycle GHG impacts than biofuel produced from the cellulosic biomass
from switchgrass. Our proposed analysis suggests that the three
feedstocks considered have GHG impacts associated with growing and
harvesting the feedstock that are similar to switchgrass. Emissions
from growing and harvesting energy cane are approximately 4 kg CO2eq/
mmBtu higher than switchgrass, emissions from growing and harvesting
giant reed are approximately 2 kg CO2eq/mmBtu lower than switchgrass,
and emissions from growing and harvesting napiergrass are approximately
6 kg CO2eq/mmBtu higher than switchgrass. These are small changes in
the overall lifecycle, representing at most a 6% change in the energy
grass lifecycle impacts in comparison to the petroleum fuel baseline.
Furthermore, the three feedstocks considered are expected to have
similar or lower GHG emissions than switchgrass associated with other
components of the biofuel lifecycle.
As a hypothetical worst case, if the calculated increases in
growing and harvesting the new feedstocks are incorporated into the
lifecycle GHG emissions calculated for switchgrass, and other lifecycle
components are projected as having similar GHG impacts to switchgrass
(including land use change associated with switchgrass production), the
overall lifecycle GHG reductions for biofuel produced from energy cane,
giant reed, and napiergrass still meet the 60% reduction threshold for
cellulosic biofuel, the lowest being a 64% reduction (for napiergrass
F-T diesel) compared to the petroleum baseline. We believe these are
conservative estimates, as use of energy cane, giant reed, or
napiergrass as a feedstock is expected to have smaller land-use GHG
impacts than switchgrass, due to their higher yields.
Although this analysis assumes energy cane, giant reed, and
napiergrass biofuels produced for sale and use in the United States
will most likely come from domestically produced feedstock, we also
intend for the proposed pathways to cover energy cane, giant reed, and
napiergrass from other countries. We do not expect incidental amounts
of biofuels from feedstocks produced in other nations to impact our
average GHG emissions. Moreover, other countries most likely to be
exporting energy cane, giant reed, or napiergrass or biofuels produced
from these feedstocks are likely to be major producers which typically
use similar cultivars and farming techniques. Therefore, GHG emissions
from producing biofuels with energy cane, giant reed, or napiergrass
grown in other countries should be similar to the GHG emissions we
estimated for U.S. energy cane, giant reed, or napiergrass, though they
could be slightly (and insignificantly) higher or lower. For example,
the renewable biomass provisions under the Energy Independence and
Security Act would prohibit direct conversion of previously unfarmed
land in other countries into cropland for energy grass-based renewable
fuel production. Furthermore, any energy grass production on existing
cropland internationally would not be expected to have land use impacts
beyond what was considered for switchgrass production. Even if there
were unexpected larger differences, EPA believes the small amounts of
feedstock or fuel potentially coming from other

[[Page 465]]

countries will not impact our threshold analysis.
Based on our assessment of switchgrass in the RFS2 final rule and
this comparison of GHG emissions from switchgrass and energy cane,
giant reed, and napiergrass, we do not expect variations to be large
enough to bring the overall GHG impact of fuel made from energy cane,
giant reed or napier grass to come close to the 60% threshold for
cellulosic biofuel. Therefore, EPA is proposing to include cellulosic
biofuel produced from the cellulose, hemicelluloses and lignin portions
of energy cane, giant reed, and napiergrass under the same pathways for
which cellulosic biomass from switchgrass qualifies under the RFS2
final rule.
Renewable gasoline and renewable gasoline blendstock: Three
renewable gasoline and renewable gasoline blendstock pathways were
compared to baseline petroleum gasoline, using the same value for
baseline gasoline as in the RFS2 final rule analysis. The results of
the proposed analysis indicate that the renewable gasoline and
renewable gasoline blendstock pathways result in a GHG emissions
reduction of 65-129% or better compared to the gasoline fuel it would
replace using corn stover as a feedstock. Since the renewable gasoline
and renewable gasoline blendstock pathways which use corn stover as a
feedstock all exceed the 60% lifecycle GHG threshold requirements for
cellulosic biofuel, and since these pathways capture the likely current
technologies and since future technology improvements are likely to
increase efficiency and lower GHG emissions, we are proposing that all
processes producing renewable gasoline or renewable gasoline blendstock
from corn stover can qualify if they fall in the following process
characterizations:
Catalytic pyrolysis and upgrading utilizing natural gas,
biogas, and/or biomass as the only process energy sources.
Gasification and upgrading utilizing natural gas, biogas,
and/or biomass as the only process energy sources.
Direct fermentation utilizing natural gas, biogas, and/or
biomass as the only process energy sources.
Fermentation and upgrading utilizing natural gas, biogas,
and/or biomass as the only process energy sources.
Any process utilizing biogas and/or biomass as the only
process energy sources.
As was the case for extending corn stover results to other
feedstocks in the RFS2 final rule, we are proposing to extend these
results to feedstocks with similar or lower GHG emissions profiles,
including the following feedstocks:
Cellulosic biomass from crop residue, slash, pre-
commercial thinnings and tree residue, annual cover crops;
Cellulosic components of separated yard waste;
Cellulosic components of separated food waste; and
Cellulosic components of separated MSW.
For more information on the reasoning for extension to these other
feedstocks refer to the feedstock production and distribution section
or the RFS2 rulemaking (75 FR 14793-14795).
Based on these results, today's proposed rule includes pathways for
the generation of cellulosic biofuel RINs for renewable gasoline or
renewable gasoline blendstock produced by catalytic pyrolysis and
upgrading, gasification and upgrading, direct fermentation,
fermentation and upgrading, all utilizing natural gas, biogas, and/or
biomass as the only on-site process energy sources or any process
utilizing biogas and/or biomass as the only on-site energy sources, and
using corn stover as a feedstock or the feedstocks noted above. In
order to qualify for RIN generation, the fuel must meet the other
definitional criteria for renewable fuel (e.g., produced from renewable
biomass, and used to reduce or replace petroleum-based transportation
fuel, heating oil or jet fuel) specified in the Clean Air Act and the
RFS regulations.
Direct Esterification: Using the same methodology as was used for
the yellow grease modeling under RFS2, but using high energy and
materials use assumptions and omitting the glycerin co-product credit,
we estimate the GHG emissions reduction for the esterification of
specified feedstocks with any level of FFA process is -71%. Since the
GHG threshold is at -50% for biomass-based diesel and advanced biofuel,
we believe that there is a large enough margin in the results to
reasonably conclude that biodiesel using esterification of specified
feedstocks with any level of FFA content meets the biomass-based diesel
and advanced biofuel 50% lifecycle GHG reduction threshold. Therefore,
we are proposing to include the process ``esterification'' as an
approved biodiesel production process in Table 1 to Sec. 40 CFR
80.1426. In addition, consistent with the modeling conducted for RFS2,
we are proposing to interpret the RFS regulations as they existed prior
to today's rule as including a direct esterification process as part of
the biodiesel pathways for which only ``trans-esterification'' was
specifically referenced in Table 1 to Sec. 40 CFR 80.1426.

V. Additional Changes to Listing of Available Pathways in Table 1 of
80.1426

We are also proposing two changes to Table 1 to 80.1426 that were
proposed on July 1, 2011 (76 FR 38844). The first change adds ID
letters to pathways to facilitate references to specific pathways. The
second change adds ``rapeseed'' to the existing pathway for renewable
fuel made from canola oil.
On September 28, 2010, EPA published a ``Supplemental Determination
for Renewable Fuels Produced Under the Final RFS2 Program from Canola
Oil'' (FR Vol. 75, No. 187, pg 59622-59634). In the July 1, 2011 NPRM
(76 FR 38844) we proposed to clarify two aspects of the supplemental
determination. First we proposed to amend the regulatory language in
Table 1 to Sec. 80.1426 to clarify that the currently-approved pathway
for canola also applies more generally to rapeseed. While ``canola''
was specifically described as the feedstock evaluated in the
supplemental determination, we had not intended the supplemental
determination to cover just those varieties or sources of rapeseed that
are identified as canola, but to all rapeseed. As described in the July
1, 2011 NPRM, we currently interpret the reference to ``canola'' in
Table 1 to Sec. 80.1426 to include any rapeseed. To eliminate
ambiguity caused by the current language, however, we proposed to
replace the term ``canola'' in that table with the term ``canola/
rapeseed''. Canola is a type of rapeseed. While the term ``canola'' is
often used in the American continent and in Australia, the term
``rapeseed'' is often used in Europe and other countries to describe
the same crop. We received no adverse comments on our July 1, 2011
proposal but are re-proposing it here in case we receive adverse
comment in response to the direct final rule also published today.
Second, we wish to clarify that although the GHG emissions of
producing fuels from canola feedstock grown in the U.S. and Canada was
specifically modeled as the most likely source of canola (or rapeseed)
oil used for biodiesel produced for sale and use in the U.S., we also
intended that the approved pathway cover canola/rapeseed oil from other
countries, and we propose to interpret our regulations in that manner.
We expect the vast majority of biodiesel used in the U.S.

[[Page 466]]

and produced from canola/rapeseed oil will come from U.S. and Canadian
crops. Incidental amounts from crops produced in other nations will not
impact our average GHG emissions. Therefore, EPA proposes to interpret
the approved canola pathway as covering canola/rapeseed regardless of
country origin.

VI. Statutory and Executive Order Reviews

A. Executive Order 12866: Regulatory Planning and Review

This action is not a ``significant regulatory action'' under the
terms of Executive Order 12866 (58 FR 51735, October 4, 1993) and is
therefore not subject to review under Executive Orders 12866 and 13563
(76 FR 3821, January 21, 2011).

B. Paperwork Reduction Act

This action does not impose any new information collection burden.
The corrections, clarifications, and modifications to the final RFS2
regulations contained in this rule are within the scope of the
information collection requirements submitted to the Office of
Management and Budget (OMB) for the final RFS2 regulations.
OMB has approved the information collection requirements contained
in the existing regulations at 40 CFR part 80, subpart M under the
provisions of the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. and
has assigned OMB control numbers 2060-0637 and 2060-0640. 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
Procedure 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 (SBA) 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 this action on small
entities, I certify that this proposed rule will not have a significant
economic impact on a substantial number of small entities. This
proposed rule will not impose any new requirements on small entities.
The relatively minor corrections and modifications this proposed rule
makes to the final RFS2 regulations do not impact small entities. We
continue to be interested in the potential impacts of the rule on small
entities and welcome comments on issues related to such impacts.

D. Unfunded Mandates Reform Act

This proposed rule does not contain a Federal mandate that may
result in expenditures of $100 million or more for State, local, and
tribal governments, in the aggregate, or the private sector in any one
year. We have determined that this action will not result in
expenditures of $100 million or more for the above parties and thus,
this rule is not subject to the requirements of sections 202 or 205 of
UMRA.
This proposed rule is also not subject to the requirements of
section 203 of UMRA because it contains no regulatory requirements that
might significantly or uniquely affect small governments. It only
applies to gasoline, diesel, and renewable fuel producers, importers,
distributors and marketers and makes relatively minor corrections and
modifications to the RFS2 regulations.

E. Executive Order 13132 (Federalism)

This action 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 action only applies to
gasoline, diesel, and renewable fuel producers, importers, distributors
and marketers and makes relatively minor corrections and modifications
to the RFS2 regulations. Thus, Executive Order 13132 does not apply to
this action.
In the spirit of Executive Order 13132, and consistent with EPA
policy to promote communications between EPA and State and local
governments, EPA specifically solicits comment on this proposed action
from State and local officials.

F. Executive Order 13175 (Consultation and Coordination With Indian
Tribal Governments)

This proposed rule does not have tribal implications, as specified
in Executive Order 13175 (65 FR 67249, November 9, 2000). It applies to
gasoline, diesel, and renewable fuel producers, importers, distributors
and marketers. This action makes relatively minor corrections and
modifications to the RFS regulations, and does not impose any
enforceable duties on communities of Indian tribal governments. Thus,
Executive Order 13175 does not apply to this action. Nonetheless, EPA
specifically solicits additional comment on this proposed action from
tribal officials.

G. Executive Order 13045: Protection of Children From Environmental
Health Risks and Safety Risks

EPA interprets EO 13045 (62 FR 19885, April 23, 1997) as applying
only to those regulatory actions that concern health or safety risks,
such that the analysis required under section 5-501 of the EO has the
potential to influence the regulation. This action is not subject to EO
13045 because it does not establish an environmental standard intended
to mitigate health or safety risks.

H. Executive Order 13211: Actions Concerning Regulations That
Significantly Affect Energy Supply, Distribution, or Use

This proposed rule is not subject to Executive Order 13211 (66 FR
18355 (May 22, 2001)), because it is not a significant regulatory
action under Executive Order 12866.

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, 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. NTTAA directs EPA to provide
Congress, through OMB, explanations when the Agency decides not to use
available and applicable voluntary consensus standards.
This action does not involve technical standards. Therefore, EPA
did not consider the use of any voluntary consensus standards.

[[Page 467]]

J. Executive Order 12898: Federal Actions To Address Environmental
Justice in Minority Populations and Low-Income Populations

Executive Order (EO) 12898 (59 FR 7629 (Feb. 16, 1994)) establishes
Federal executive policy on environmental justice. Its main provision
directs Federal agencies, to the greatest extent practicable and
permitted by law, to make environmental justice part of their mission
by identifying and addressing, as appropriate, disproportionately high
and adverse human health or environmental effects of their programs,
policies, and activities on minority populations and low-income
populations in the United States.
EPA has determined that this proposed rule will not have
disproportionately high and adverse human health or environmental
effects on minority or low-income populations because it does not
affect the level of protection provided to human health or the
environment. These amendments would not relax the control measures on
sources regulated by the RFS regulations and therefore would not cause
emissions increases from these sources.

VII. Statutory Provisions and Legal Authority

Statutory authority for the rule finalized today can be found in
section 211 of the Clean Air Act, 42 U.S.C. 7545. Additional support
for the procedural and compliance related aspects of today's rule,
including the recordkeeping requirements, come from Sections 114, 208,
and 301(a) of the Clean Air Act, 42 U.S.C. 7414, 7542, and 7601(a).

List of Subjects in 40 CFR Part 80

Environmental protection, Administrative practice and procedure,
Agriculture, Air pollution control, Confidential business information,
Diesel Fuel, Energy, Forest and Forest Products, Fuel additives,
Gasoline, Imports, Labeling, Motor vehicle pollution, Penalties,
Petroleum, Reporting and recordkeeping requirements.

Dated: November 30, 2011.
Lisa P. Jackson,
Administrator.
[FR Doc. 2011-31577 Filed 1-4-12; 8:45 am]
BILLING CODE 6560-50-P

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