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Office of Transportation and Air Quality

EPA-420-F-00-056

December 2000

Gasoline Sulfur Rule Questions and Answers

Received Between May and December 2000

The following are responses to questions received by the Environmental Protection 

Agency (EPA) concerning the manner in which the EPA intends to implement and assure 

compliance with the gasoline sulfur regulations at 40 CFR Part 80. This document was prepared 

by EPA's Office of Air and Radiation, Office of Transportation and Air Quality, and the Office of 

Enforcement and Compliance Assurance, Office of Regulatory Enforcement.

Regulated parties may use this document to aid in achieving compliance with the gasoline 

sulfur regulations. However, this document does not in any way alter the requirements of these 

regulations. While the answers provided in this document represent the Agency's interpretation 

and general plans for implementation of the regulations at this time, some of the responses may 

change as additional information becomes available or as the Agency further considers certain 

issues.

This guidance document does not establish or change legal rights or obligations. It does 

not establish binding rules or requirements and is not fully determinative of the issues addressed. 

Agency decisions in any particular case will be made applying the law and regulations on the 

basis of specific facts and actual action.

While we have attempted to include answers to all questions received to date, the 

necessity for policy decisions and/or resource constraints may have prevented the inclusion of 

certain questions. Questions not answered in this document will be answered in a subsequent 

document. The Agency intends to provide any additional responses as expeditiously as possible. 

Questions that merely require a justification of the regulations, or that have previously been 

answered or discussed in the preamble to the regulations have been omitted.

COMPLIANCE

1. Question: Is a parent company responsible for complying with the corporate pool

average standards in 2004 and 2005 for all of the refineries owned by its subsidiaries in addition 

to all of its own refineries?

Answer: Section 80.195(c) provides that the corporate pool average standards in 2004 

and 2005 are the maximum average sulfur levels allowed for a refiner’s or importer’s gasoline 

production from all of the refiner’s refineries or all gasoline imported by an importer in a
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calendar year. The preamble to the final rule states that, for purposes of compliance with the

corporate pool average standards, a parent company is considered to be the refiner of any refinery

facilities owned by wholly-owned subsidiaries of the parent company. As such, the parent

company must comply with the corporate pool average standards for these facilities. In its

compliance calculations, the parent company must include the gasoline produced at any refineries

it owns, plus the gasoline produced at any refineries owned by its wholly-owned subsidiaries. 

See 65 FR 6698, 6755 (February 10, 2000). We believe, however, that parties should have the

option to comply with the corporate pool average standards on a corporate parent level or a

subsidiary level. As a result, a parent company may demonstrate compliance with the corporate

pool average standards based on all of the gasoline produced at all refineries owned by the parent

company and the parent company’s wholly-owned subsidiaries, or, the parent company may be

deemed in compliance if it demonstrates compliance for the gasoline produced at all of its own

refineries and each of the parent company’s subsidiaries demonstrates compliance for the 

gasoline produced at all of its own refineries. The environmental benefits of the sulfur rule

would not be compromised by allowing this option, since compliance on the level of each 

subsidiary would result in the corporate pool average standard being met by a greater number of

pools with fewer refineries in each pool over which to average the sulfur content. We intend to

modify the regulations to clarify this option in a future rulemaking. In any case, the parent

company would remain liable for any violations by the subsidiary. See § 80.395(a)(11).

Similarly, where refineries are owned by subsidiaries of a foreign parent company, the

foreign parent company may demonstrate compliance with the corporate pool standards for all of

the gasoline produced at refineries owned by the foreign parent company’s wholly-owned U.S.

subsidiaries, or each U.S. subsidiary owned by the foreign parent company may demonstrate

compliance with the corporate pool standards for its own refineries. As indicated above, in any

case, the foreign parent company would remain liable for any violations by the subsidiary. 

Where the foreign parent company demonstrates compliance with the corporate pool standards

for its U.S. subsidiaries, any gasoline imported into the U.S. that was produced at the foreign

parent company’s foreign refineries, or at refineries owned by foreign subsidiaries of the foreign

parent company, would not be included in the parent company’s compliance calculations, since

the regulations provide that the sulfur standards, including the corporate pool average standards,

are met by the importer for all imported gasoline. See § 80.195(a)(4).

2. Question: The regulations state that a partner to a joint venture may include the joint

venture refinery in its corporate pool. If a foreign corporation is a partner in a U.S. refinery joint

venture, and also owns a U.S. subsidiary which has several refineries, can the U.S. subsidiary

establish a corporate pool composed of its refineries and the foreign parent’s U.S. joint venture

refinery?

Answer: Section 80.195(c) provides that a partner to a joint venture may include one or

more of the joint venture refineries in its corporate pool. As discussed in Question 1 above, a

parent company, domestic or foreign, may demonstrate compliance with the corporate pool

average standards for the refineries owned by its wholly-owned subsidiaries, or each subsidiary
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can individually demonstrate compliance with the corporate pool average standards for its own

refineries. As a result, in the scenario described above, if the parent company demonstrates

compliance with the corporate pool standards for its subsidiary, the parent company may include

its joint venture refinery in its corporate pool. However, if the parent company’s subsidiary

individually demonstrates compliance with the corporate pool average standards for its refineries,

rather than the parent company demonstrating compliance for the subsidiary’s refineries, then the

subsidiary may only include in its pool a refinery or refineries owned by a joint venture to which

the subsidiary itself is a partner. Such subsidiary may not include refineries owned by a joint

venture to which the parent, but not the subsidiary, is a partner. 

3. Question: The sulfur regulations allow refiners and importers to include ethanol added

downstream in compliance calculations. The denaturants used in ethanol usually contain some

amount of sulfur. Should the sulfur content of the denatured ethanol be included in calculations

for purposes of compliance and credit generation?

Answer: Section 80.205(c) provides that a refiner or importer may include oxygenates

added downstream from the refinery or import facility when calculating the refinery’s or

importer’s annual average sulfur content, provided that the refiner or importer complies with the

requirements under § 80.69(a) or § 80.101(d)(4)(ii) of the RFG/anti-dumping regulations, as

applicable, for including such oxygenates. These sections of the RFG/anti-dumping regulations

do not require refiners to include in compliance calculations the properties of the denaturant

added to the ethanol downstream. Therefore, for purposes of demonstrating compliance with the

sulfur standards or generating credits or allotments, the sulfur content of the denaturant in ethanol

is not required to be included in the calculations under § 80.205. As indicated in the preamble to

the final sulfur rule, where ethanol is included in the refinery compliance calculations, refiners

assume this ethanol has no sulfur content. See 65 FR at 6800. Section 80.385(e) prohibits any

party from blending into gasoline denatured ethanol with a sulfur content higher than 30 ppm. In

amounts of 30 ppm or below, we believe that the sulfur in the denatured ethanol will not have a

measurable impact on the sulfur level of the gasoline to which the ethanol is added. 

4. Question: In the preamble to the final sulfur rule, EPA stated that an oxygenate blender

who uses blendstock as a denaturant, instead of gasoline, is a refiner under the regulations. Does

this mean that such an oxygenate blender is subject to all of the requirements for refiners under

the sulfur rule?

Answer: The preamble to the final rule states that an oxygenate blender who uses

blendstock instead of finished gasoline as a denaturant for ethanol is a “refiner” under the

regulations. As such, the oxygenate blender is required to demonstrate compliance with the

sulfur standards for the denatured ethanol added to the gasoline. 65 FR at 6800.

The preamble discussion cited above reflects a concern that a blendstock used as a

denaturant could have a much higher sulfur content than finished gasoline, which is subject to the

30 ppm average sulfur standard. The final rule, however, contains a provision which prohibits an
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ethanol blender from blending into gasoline denatured ethanol with a sulfur content higher than

30 ppm. § 80.385(e). This prohibition applies regardless of whether the denaturant used is

finished gasoline or a blendstock.

 

We believe that the prohibition in § 80.385(e) adequately addresses the concern raised in

the preamble regarding the use of a blendstock as a denaturant rather than finished gasoline. As

a result, we do not believe there is a necessity for such oxygenate blenders to demonstrate

compliance with the sulfur standards for the blendstock used as a denaturant, or to fulfill the

requirements for refiners under the regulations. Therefore, we are withdrawing the preamble

discussion as guidance for interpreting the regulations on this particular issue. However, all

oxygenate blenders, regardless of the type of denaturant used, are subject to the requirements and

prohibitions applicable to downstream parties, as well as the prohibition specified in § 80.385(e). 

See § 80.212. If a blendstock used as a denaturant causes a violation, the oxygenate blender

would be liable for that violation. Oxygenate blenders, therefore, may wish to obtain information

regarding the sulfur content of any blendstock used as a denaturant to avoid liability under §

80.385(e).

SMALL REFINERS

1. Question: The sulfur regulations require small refiners to include in their small refiner

application the crude oil capacity of their refineries as reported to the Energy Information

Administration (EIA). Foreign refiners, however, do not report to the EIA. What should these

refiners include in their applications regarding crude oil capacity?

Answer: As indicated in the question, § 80.235(c)(2) provides that a refiner’s small

refiner status application must contain the total corporate crude oil capacity of each refinery as

reported to the EIA. Since foreign refiners do not report their crude oil capacity to the EIA, the

small refiner status application for a foreign refiner must contain the total crude capacity of each

refinery as documented by a comparable reputable source, such as a professional publication or

trade journal. We intend to clarify this in a future rulemaking.

2. Question: Section 80.250 provides the equations to be used in determining small refiner

sulfur baselines and baseline volumes. This section, however, does not address whether

oxygenates added downstream from the refinery are to be included in the calculations. Section

80.295 requires such oxygenates to be included in calculations for a baseline for early credit

generation. Should oxygenates added downstream also be included in calculations for a small

refinery baseline?

Answer: We intended the provisions of § 80.250 for determining a baseline under the

small refiner program to be consistent with the provisions of § 80.295, since both baselines are

intended to represent current sulfur levels, and they are based on the same calculation. As

indicated in the question, under § 80.295, any refiner who included oxygenates blended
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downstream in compliance calculations for 1997-1998 under the RFG and anti-dumping

regulations must include this oxygenate in the calculations for sulfur content under § 80.295 for

purposes of establishing a baseline for early credit generation. Consistent with this requirement,

small refiners who included oxygenates blended downstream in compliance calculations for

1997-1998 under the RFG/anti-dumping regulations must include this oxygenate in the baseline

calculations under § 80.250. We intend to clarify this requirement in a future rulemaking.

ALLOTMENTS AND CREDITS

1. Question: In 2003, a refiner has the ability to generate Type A allotments if his

individual refinery sulfur content is 60 ppm or lower. For a refinery with a baseline under 120

ppm, a 0.8 factor is applied to calculate allotments. For 2003, can the refiner specify a portion of

the eligible sulfur reduction as credits instead of allotments? If so, would the calculation for the

credit portion be the same as the credit calculation in 2000-2002; i.e., without the 0.8 factor used

to calculate allotments?

Answer: The regulations provide refiners, in 2003, with the option to generate credits in

accordance with the provisions of § 80.305, or generate allotments (and credits where applicable)

in accordance with the provisions of § 80.275. See § 80.275(a). The regulations do not allow a

refiner to generate some credits using the provisions of § 80.305 and some allotments/credits

using the provisions of § 80.275 in 2003. Under § 80.305, credits are generated based on the

total volume of gasoline produced at the refinery during the annual averaging period. Similarly,

under § 80.275, allotments are generated based on the total volume of gasoline produced at the

refinery during the annual averaging period. These sections do not provide for credits or

allotments to be calculated based on a portion of a refinery’s gasoline production. 

2. Question: Foreign refiners who have an approved anti-dumping refinery baseline under

§ 80.94, like domestic refiners, are required to fulfill the requirements for applying for a sulfur

baseline under § 80.245 or § 80.290, including the submission of 1997-1998 batch information as

reported to EPA under the RFG/anti-dumping regulations. However, in some cases, a foreign

refiner may have an approved baseline under § 80.94, but this baseline may not have been in

effect until after 1998. As a result, such foreign refiner would not have submitted batch reports

to EPA in 1997-1998. How should this foreign refiner comply with the requirements of § 80.245

or § 80.290?

Answer: To establish a sulfur baseline for purposes of the small refinery standards or

generating early sulfur credits, the regulations require refiners to submit to EPA sulfur baseline

data for 1997-1998, including information on each batch of gasoline produced and the batch

number assigned to the batch for purposes of compliance with the RFG/anti-dumping

regulations. See §§ 80.245(a) and 80.290(c). The data in the refiner’s sulfur baseline submission

may then be verified by EPA by comparing it with the data submitted to EPA in the refiner’s

1997-1998 annual reports. Foreign refiners who do not have an approved individual baseline for
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purposes of compliance with the anti-dumping regulations are required to follow the procedures

under §§ 80.91 through 80.93 (provisions for establishing an individual anti-dumping baseline)

to establish the volume and sulfur content of gasoline that was produced at the foreign refinery

and imported into the United States during 1997-1998, for purposes of calculating a sulfur

baseline under § 80.250 or § 80.295. See §§ 80.250(b), 80.290(d) and 80.410(b)(1). This is in

addition to the other baseline establishment requirements under § 80.245 and § 80.290.

However, as indicated in the question, a foreign refiner who has an approved individual

anti-dumping baseline, but one that did not apply for purposes of compliance with the antidumping regulations until after 1998, also would not have submitted annual reports to EPA in

1997-1998. In such a case, we believe that the foreign refinery’s baseline may be based on the

gasoline produced at the foreign refinery and imported into the United States during the period of

time that the refinery was subject to its individual anti-dumping baseline. As a result, the foreign

refiner should submit in the sulfur baseline application under § 80.245 or § 80.290 information

and data for the gasoline produced at the refinery and imported into the United States during each

annual averaging period that the refinery was subject to its individual anti-dumping baseline. 

EPA will evaluate all of the data submitted by the foreign refiner in determining the appropriate

sulfur baseline for the refinery. Where we conclude that the data submitted reasonably reflects

current sulfur levels, the refinery’s baseline will be determined based on the average sulfur

content of gasoline produced by the foreign refinery and imported into the United States during

the most recent annual averaging period in which the foreign refinery was subject to its

individual anti-dumping baseline. We intend to clarify this requirement in a future rulemaking. 

4. Question: Accumulated Type A allotments generated in 2003 and 2004 would only have

50% of their value as allotments if they are consumed in 2005. Type A allotments can be

converted to credits in 2005 and 2006. What value do the Type A allotments that were generated

in 2003 and 2004 have as credits in 2005 and 2006? Can they be converted on a 1 to 1 basis, or

do they have to be converted to 2005 allotments first (at 50% value) and then be converted to

credits? 

Answer: The preamble to the final rule states that allotments generated in 2003 or 2004

which are carried over to 2005 are discounted by 50%. The discounted allotments may then be

used to achieve compliance with the corporate pool average standard in 2005 or converted into

credits for compliance with the refinery average standard in 2005 (or beyond). As a result, where

allotments generated in 2003 or 2004 are carried over to 2005 and then converted into credits,

such credits would retain only 50% of the value of the original allotments generated in 2003 or

2004. However, if the allotments are converted into credits before being carried over to 2005,

such credits would not be discounted when they are carried over, and, therefore, would retain

100% of the value of the original allotments. An allotment that is converted into a credit before

being carried over to 2005 may be reconverted into an allotment for use in achieving compliance

with the corporate pool average in 2005, but the allotment will be discounted 50%. See 65 FR at

6765. We intend to clarify these requirements in § 80.275 in a future rulemaking.
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5. Question: Under the GPA provisions, a refiner’s annual average GPA standard is the

lesser of 150 ppm, the refinery’s 1997-1998 sulfur baseline plus 30 ppm, or the lowest average

sulfur content for any year in which the refinery generated early credits or allotments plus 30

ppm. Section 80.310 provides an equation for determining credit generation in 2004 and

thereafter based on the refinery’s sulfur standard. However, this section does not include the

term “plus 30 ppm” in the GPA standard. Is this an error in § 80.310?

Answer: The term “plus 30 ppm” in the GPA standard was inadvertently omitted in §

80.310. Under § 80.310, for GPA gasoline, the Sstd value in the equation should be the applicable

refinery or importer standard for GPA gasoline established under § 80.216(a). Under §

80.216(a), the refinery or importer annual average sulfur standard for gasoline produced or

imported for use in the GPA is the lesser of 150 ppm or the refinery’s or importer’s 1997-1998

average sulfur level, calculated in accordance with § 80.295, plus 30 ppm (§ 80.216(a)(1)) ; or, in

the case of any refinery whose actual annual sulfur average decreases to a level lower than the

refinery’s annual average sulfur standard for GPA gasoline established under § 80.216(a)(1)

during the period 2000 through 2003, the lowest average sulfur content for any year in which the

refinery generated allotments or credits, plus 30 ppm, not to exceed 150 ppm (§ 80.216(a)(2)). 

We intend to correct this in a future rulemaking. 

6. Question: The regulations at § 80.205 require the annual refinery or importer average or

corporate pool average calculations to be conducted to two decimal places. However, the

regulations at §§ 80.250 and 80.295 for calculating a sulfur baseline for purposes of determining

small refinery standards and generating early credits do not have a similar requirement. Should

the sulfur baseline submissions be rounded to the nearest ppm or conducted to two decimal

places as required for calculating the annual average sulfur level under § 80.205?

Answer: We intended the provisions for calculating a sulfur baseline under §§ 80.250

and 80.295 to be consistent with the provisions for calculating the refinery or importer annual

average sulfur level under § 80.205, including the requirement to conduct the calculations to two

decimal places. As a result, we intend to modify §§ 80.250 and 80.295 in a future rulemaking to

require baseline calculations to be conducted to two decimal places. Note, however, that credits

under the sulfur program are in “ppm-gallons.” § 80.305(c). We interpret § 80.305(c) to require

credits to be rounded to the nearest ppm-gallon. Therefore, in calculating sulfur credits using the

equation in § 80.305(a), the refiner should use the refinery’s sulfur baseline value established

under § 80.250 or § 80.295, conducted to two decimal places, and the refinery’s actual annual

average sulfur level calculated under § 80.205, conducted to two decimal places. Once the sulfur

credits are calculated, the refiner should round the credits to the nearest ppm-gallon. 

SAMPLING AND TESTING

1. Question: In a recent Questions and Answers document, EPA indicated that, under the

sulfur regulations at § 80.330, a refiner who produces conventional gasoline using in-line
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blending equipment cannot participate in the early credit program unless the refiner obtains an inline blending waiver under § 80.65(f)(4) to address sulfur sampling and analysis. See “Gasoline

Sulfur Rule Questions and Answers,” EPA420-F-00-018 (May 2000) (Sampling and Testing

Question 6). We believe this requirement is unjustified, since there are no downstream sulfur

standards prior to January 1, 2004, and early credits are based on an annual sulfur average. Will

EPA consider modifying the regulations to allow in-line blenders to generate early credits

without obtaining an in-line blending waiver?

Answer: The current regulations at § 80.330(a)(1) require a refiner to collect a

representative sample from each batch of gasoline produced and test each sample to determine its

sulfur content prior to the gasoline leaving the refinery. The requirements in § 80.330(a)(1)

apply beginning on January 1, 2004, or January 1 of the first year of credit or allotment

generation, whichever is earlier. Section 80.330(a)(4) provides an exception to the requirement

in § 80.330(a)(1) that gasoline be tested prior to leaving the refinery for parties who use

computer-controlled in-line blending equipment and are unable to obtain test results prior to the

gasoline leaving the refinery. Such refiners may meet the testing requirement under the terms of

an in-line blending waiver granted under § 80.65(f)(4). Therefore, as discussed in the May 2000

Questions and Answers document, under the current sulfur regulations, refiners who produce

gasoline using in-line blending equipment and who are unable to obtain test results prior to the

gasoline leaving the refinery must have an in-line blending waiver under § 80.65(f)(4) in order to

generate early credits in 2000-2003. This also applies to early allotment generation in 2003. 

Under the RFG regulations, refiners who produce RFG by in-line blending are required to obtain

a waiver under § 80.65(f)(4). However, refiners who produce conventional gasoline by in-line

blending are not required to obtain a waiver under § 80.65(f)(4). The current sulfur regulations

would require these conventional gasoline refiners to apply for and receive a waiver under §

80.65(f)(4) in order to generate early credits or allotments. 

Upon consideration of the comments we have received, we believe that the requirement

under § 80.330(a)(4) to obtain an in-blending waiver, in regard to both RFG and conventional

gasoline, is unnecessary for purposes of generating early credits or allotments. The waiver

requirement was intended to ensure that batches produced using in-line blending equipment have

known sulfur levels at the time of shipment. Since early credit or allotment generation is based

on the refinery’s annual average sulfur level, credits and allotments are not calculated until the

end of the annual averaging period, after the test results for all batches produced during the

averaging period are obtained. Therefore, it is unnecessary for refiners to obtain test data prior to

the gasoline leaving the refinery. Moreover, as indicated in the question, there are no per-gallon

sulfur standards prior to January 1, 2004, which would necessitate knowing the sulfur content of

the gasoline prior to its leaving the refinery. As a result, we intend to modify § 80.330 in a future

rulemaking to provide that refiners, including those who produce gasoline using computercontrolled in-line blending equipment, are not required to obtain test results prior to the gasoline

leaving the refinery in order to generate early credits in 2000-2003 or early allotments in 2003. 

In-line blenders, therefore, would not be required to obtain an in-line blending waiver under §

80.65(f)(4) for purposes of generating early credits or early allotments. However, this does not
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relieve refiners from meeting the requirements under § 80.330 to obtain a representative sample

of each batch of gasoline produced. In the case of in-line blenders who do not obtain a sample of

each batch from a storage tank, the sampling method must conform to the methodology set forth

in ASTM D 4177-95, as required in § 80.330(b)(2). In the case of in-line blenders who do obtain

their batch samples from a storage tank, the sampling for such samples must conform to the

appropriate methodology specified in § 80.330(b)(1). We also intend to clarify the requirements

for in-line blenders beginning in January 2004 in a future rulemaking.

2. Question: Do the provisions of § 80.330(a)(3) apply to refiners who produce

conventional gasoline using in-line blending equipment?

Answer: Yes. Section 80.330(a)(3) provides that, prior to January 1, 2004, for purposes

of meeting the sampling and testing requirements of the sulfur rule, any refiner may, prior to

analysis, combine samples of gasoline from more than one batch of gasoline or blendstock and

treat such composite sample as one batch of gasoline or blendstock pursuant to the requirements

of § 80.101(i)(2). The provisions of § 80.330(a)(3) apply to all refiners of conventional gasoline,

including those who produce gasoline using in-line blending equipment. 

3. Question: Are refiners of conventional gasoline who composite samples under §

80.330(a)(3) required to use the sampling methods in § 80.330(b)?

Answer: Yes. Section 80.330(b), which requires the use of the sampling methods

provided in §§ 80.330(b)(1) and (b)(2), applies to all samples taken for purposes of complying

with the provisions of § 80.330(a), including § 80.330(a)(3). 

4. Question: Section 80.335 describes the sample retention requirements for refiners or

importers. However, this section does not indicate how reformulated gasoline blendstock for

oxygenate blending (RBOB) samples should be considered. Should a refiner retain neat RBOB

samples or handblend samples (RBOB blended with ethanol)?

Answer: Section 80.69(a)(2) of the RFG regulations requires refiners to conduct testing

on RBOB by adding the specified type and amount of oxygenate to a representative sample of the

RBOB and determining the properties and characteristics of the resulting gasoline (i.e., a

“handblend”). Section 80.335(a) requires refiners to collect a representative portion of each

sample analyzed and retain sample portions as specified in § 80.335(a)(2).

We interpret § 80.335(a) to require refiners to retain samples of the RBOB batches and

samples of the ethanol used to conduct the handblend testing, rather than samples of the actual

handblend. Refiners, therefore, are not required to create additional volumes of the handblend

samples for purposes of fulfilling the sample retention requirements of § 80.335. We believe that

having the RBOB and accompanying ethanol samples available to EPA will allow EPA to

determine whether the refiner’s handblend testing was properly conducted. We intend to clarify

this sampling and retention requirement for RBOB in a future rulemaking.