Regulation of Fuels and Fuel Additives:


Renewable Fuel Standard Program


Summary and Analysis of Comments


Chapter 2


Renewable Fuel Standard


Assessment and Standards Division 

Office of Transportation and Air Quality 

U.S. Environmental Protection Agency 

EPA420-R-07-006 

April 2007 
RFS Summary and Analysis of Comments 

2 RENEWABLE FUEL STANDARD

2.1 Applicability of the Standard in 2007.............................................................. 2-1 

2.1.1 Prospective Approach vs. Collective Compliance................................... 2-1 

2.1.2 Program Start Date................................................................................... 2-3 

2.1.3 RIN Generation Start Date....................................................................... 2-5 

2.2 Calculation of the Standard.............................................................................. 2-5 

2.2.1 State/Territory Opt-in...............................................................................2-5 

2.2.2 Inclusion of Diesel................................................................................... 2-6 

2.2.3 Cellulosic Ethanol Standard..................................................................... 2-7 

2.2.4 Data Used................................................................................................. 2-8 

2.2.5 Other Issues Related To the Standard...................................................... 2-8 

2.3 Renewable Volume Obligations...................................................................... 2-9 

2.3.1 Refiner vs. Refinery................................................................................. 2-9 

2.3.2 Products Included in the RVO Calculation............................................ 2-10 

2.4 Exporters of Renewable Fuel......................................................................... 2-11 

2.4.1 RINs on Renewable Fuel for Export......................................................2-11 

2.4.2 Renewable Volume Obligation for Exporters........................................2-12 

2.5 Obligated Parties............................................................................................ 2-13 

RFS Summary and Analysis of Comments 

2 RENEWABLE FUEL STANDARD

The comments in this section correspond to Section III of the preamble to the 

proposed rule and pertain to the Renewable Fuel Standard in general. The comments we 

received and our response to those comments are summarized below. 

2.1 Applicability of the Standard in 2007 

2.1.1 Prospective Approach vs. Collective Compliance 

What Commenters Said:

EPA received a number of comments on the proposed approaches for start-up of 

the RFS program. Marathon Petroleum Company (MPC), CHS, FutureFuel, BP, 

ExxonMobil, National Petrochemical and Refiners Association (NPRA), and the 

American Petroleum Institute (API) commented that they approve of EPA’s proposed 

prospective approach of applying the renewable fuel standard only to those volumes of 

gasoline produced after the effective date of the final rule. BP commented that the 

application of the collective compliance approach in 2007 would penalize early movers 

by not giving credit for proactive use of renewable fuels and would allow obligated 

parties who do not wish to blend renewable fuels to further delay ethanol and/or biodiesel 

use. The commenter emphasized that the 2006 default rule provision included in the 

2005 Energy Policy Act was not stipulated by Congress to extend into 2007, and thus 

enactment beginning 60 days after publication in the Federal Register would be more 

consistent with the original intent of Congress. Shell/Motiva agreed that a default, 

industry-wide program for 2007 would be contrary to the plain language and intent of the 

Energy Policy Act of 2005. Furthermore, Shell/Motiva commented that they believe that 

a default program would negate the individual compliance obligations and the credit 

trading program that Congress envisioned. 

The Missouri Department of Natural Resources (MDNR) raised other questions 

regarding the collective compliance approach for 2007. Specifically, the commenter 

questioned how any renewable fuel deficit created on an industry-wide basis in 2007 

would be handled on an individual basis in 2008. The commenter also questioned the 

extent to which the ethanol industry would be held accountable for any shortfall in 

renewable fuels in 2007 or in any future years. Additionally, MDNR commented that in 

the absence of a credit-trading program, it may be difficult for parties in regions that lack 

easy access to renewable fuel supplies, such as in the Northeast, to meet its renewable 

volume obligation (RVO) through physical throughput without any provisional assistance 

of the credit-trade. 

On the other hand, MDNR, the American Coalition for Ethanol (ACE), and the 

Renewable Fuels Association (RFA) commented that a prospective approach would not 

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Chapter 2: Renewable Fuel Standard 

ensure that the total volume of renewable fuel required to be used in 2007 would in fact 

be used. ACE and RFA further commented that the Energy Policy Act of 2005 did not 

specify a particular implementation date for the RFS credit program and noted that the

collective compliance approach would not render the credit program null for 2007. ACE 

and RFA also commented that the collective compliance approach would not need to 

include carryover of excess volumes generated, noting that where the goal of the program

is to ensure an increasing minimum volume of renewable fuel is used each year, the 

“banking” of credits to reduce compliance costs in later years would undermine the 

purpose of the Energy Policy Act of 2005. For these reasons, ACE and RFA believed 

EPA should apply the collective compliance approach for 2007. 

Finally, ExxonMobil recommended that if the final rule is delayed and/or lead 

time requirements of the stakeholders dictate that the effective date be later than July 

2007, EPA should revert to the collective compliance approach for 2007, reasoning that a 

compliance “year” of less than six months imposes too great an accounting and 

recordkeeping burden for any potential added assurance of meeting the RFS that it 

provides. 

Letters:

American Coalition for Ethanol (ACE) OAR-2005-0161-0218 

American Petroleum Institute (API) OAR-2005-0161-0185 

BP Products North America OAR-2005-0161-0221, -0230 

CHS Inc. OAR-2005-0161-0203 

FutureFuel OAR-2005-0161-0198 

ExxonMobil Refining & Supply Co. OAR-2005-0161-0197 

Marathon Petroleum Company (MPC) OAR-2005-0161-0175 

Missouri Department of Natural Resources (MDNR) OAR-2005-0161-0217 

National Petrochemical and Refiners Association (NPRA) OAR-2005-0161-0170, -0232 

Renewable Fuels Association (RFA) OAR-2005-0161-0192, -0228 (hearing) 

Shell Oil Company/Motiva Enterprises OAR-2005-0161-0215 

Our Response:

We believe that a collective compliance approach is not appropriate for 2007. 

The Energy Act requires us to promulgate regulations that provide for the generation of 

credits by any person who over-complies with their obligation. It also stipulates that a 

person who generates credits must be permitted to use them for compliance purposes or 

to transfer them to another party. These credit provisions have meaning only in the 

context of an individual obligation to meet the applicable standard. Delaying a credit 

program until 2008 would mean the credit provisions have no meaning at all for 2007, 

since under a collective compliance approach no person (individual facility or company) 

would be liable for meeting the applicable standard. Including a "collective" credit or

deficit carry-forward as part of a collective compliance program would also not fully 

implement the credit provisions of the Energy Act. 

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RFS Summary and Analysis of Comments 

We recognize that the prospective approach to 2007 compliance will not 

guarantee by regulation that the total renewable fuel volumes required by the Energy Act 

for 2007 would actually be used in 2007. However, current projections from the Energy 

Information Administration (EIA) on the volume of renewable fuel expected to be 

produced in 2007 indicate that the Energy Act's required volumes will be exceeded by a 

substantial margin due to the relative economic value of renewable fuels in comparison to 

gasoline. We are confident that the combined effect of the regulatory requirements for 

2007 and the expected market demand for renewable fuels will lead to greater renewable 

fuel use in 2007 than is called for under the Energy Act. 

The comments did not adequately support the contention that a prospective 

approach to program startup would cause confusion or an undue burden for regulated 

parties. As described in our response to comments in Section 2.1.2, we believe that the 

September 1, 2007, start date is feasible and supported by stakeholders. Our final rule 

therefore implements a prospective approach to program startup in which the renewable 

fuel standard would apply to those volumes of gasoline produced after September 1, 

2007, and Renewable Identification Number (RIN) generation would also begin for 

renewable fuel volumes produced or imported on or after this date. The prospective 

compliance approach not only provides obligated parties with the opportunity to generate 

credits in 2007, but also provides the industry with the certainty they need to comply and 

is relatively straightforward to implement. 

2.1.2 Program Start Date 

What Commenters Said:

Several commenters remarked on the start date for the RFS program. RFA, 

National Corn Growers Association (NCGA), National Council of Farmer Cooperatives 

(NCFC), and American Farm Bureau Federation (AFBF) commented that, given the 

complexity of the proposed RFS program, they believe the program start date should be 

deferred until January 1, 2008, to give renewable fuel producers and obligated parties 

sufficient time to make the transition from the 2006 collective compliance system, and to 

cope with the program’s new regulatory burdens. RFA further commented that since the 

RIN trading program is supposed to include credits for small refineries that waive their 

exemption and such credits are not available until January 1 of the year after notification 

of waiver is provided, implementing the trading program in 2008 rather than in the 

middle of 2007 would allow a more complete trading program. 

BP and API emphasized that enactment of the final rule should not be delayed to 

2008, as some parties suggested at the public hearing on the RFS proposal. NPRA 

commented that EPA should revise §80.1106(b)(1) and clarify that the RFS program will 

not be effective for the entire calendar year of 2007. Several commenters, including 

MPC, NPRA, and BP, agreed with the proposed timing of the renewable fuel standard to 

begin 60 days after publication of the final rule in the Federal Register. MPC further 

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Chapter 2: Renewable Fuel Standard 

recommended that EPA establish a specific start date for the program, such as July 1, 

2007. 

Flint Hills Resources (FHR) agreed that setting a fixed date for implementation 

would facilitate planning given the uncertainty of the publication date of the final RFS 

rule. However, FHR also commented that the proposed 60-day delay between final rule 

publication and effective date of the program would not provide adequate time for all 

involved parties to prepare to manage the requirements of the rule. ExxonMobil and API 

also commented that the final rule should become effective no sooner than 60-120 days 

after publication to provide sufficient lead time to participants in the new program. 

Letters:

American Farm Bureau Federation (AFBF), National Corn Growers Association 

(NCGA), National Council of Farmer Cooperatives (NCFC) 

 OAR-2005-0161-0188 

American Petroleum Institute (API) OAR-2005-0161-0185 

BP Products North America OAR-2005-0161-0221, -0230 

ExxonMobil Refining & Supply Co. OAR-2005-0161-0197 

Flint Hills Resources (FHR) OAR-2005-0161-0222 

Marathon Petroleum Company (MPC) OAR-2005-0161-0175 

National Petrochemical and Refiners Association (NPRA) OAR-2005-0161-0170, -0232 

Renewable Fuels Association (RFA) OAR-2005-0161-0192, -0228 (hearing) 

Our Response:

We do not believe that the effective date of the rule should be delayed until 2008. 

Although we recognize that regulated parties need time to put into place the RIN tracking 

systems that will be required, comments provided did not support the need to delay 

program startup until 2008 to complete this preparation. Our close collaboration with 

stakeholders in development of the program ensures that regulated parties will have 

enough understanding about the basic requirements of the compliance and enforcement 

program to permit them to prepare for implementation even before publication of the 

final rule. 

Rather than requiring the program to begin on the effective date of the rule as 

proposed (60 days following publication in the Federal Register), we are finalizing a start 

date of September 1, 2007. By setting such a date, industry will be able to plan with 

confidence to start complying upon signature of the rule, rather than having the start date 

depend upon the timing of publication of this final rule in the Federal Register. We

recognize the concerns expressed in comments that time is needed to prepare Information 

Technology (IT) systems to comply with the program. However, we believe that a 

September 1, 2007, start date will provide sufficient time. The final rule is in most 

respects consistent with the NPRM, and based on discussions with industry, plans for 

implementation are already underway. Furthermore, a September 1, 2007, start date will 

likely provide regulated parties some additional time to prepare in comparison to simply 

setting the start date as the effective date of the rule. 

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RFS Summary and Analysis of Comments 

2.1.3 RIN Generation Start Date 

What Commenters Said:

EPA received a comment from NPRA on specifying the date when the first RINs 

may be issued. NPRA questioned whether a renewable fuel producer or importer could 

begin to generate RINs once they are registered with the Agency and the rule has been 

promulgated, but before the program compliance start date. 

Letters:

National Petrochemical and Refiners Association (NPRA) OAR-2005-0161-0170, -0232 

Our Response:

Our final rule sets a program start date of September 1, 2007. On this date, 

accrual of both gasoline volumes subject to the standard and renewable fuel volumes for 

which RINs must be generated will begin. We are not providing for, nor are we 

allowing, RINs to be generated prior to September 1, 2007. However, we are allowing 

renewable fuel producers and importers to generate RINs for product in inventory on 

September 1, 2007. 

2.2 Calculation of the Standard 

2.2.1 State/Territory Opt-in 

What Commenters Said:

EPA received a comment from MDNR on the proposal for a noncontiguous state 

or territory to submit a petition to opt in to the RFS program for a given year. The 

commenter suggested that EPA consider implementing a provision that would allow a 

state/territory to declare its intentions to file such a petition at least 120 days prior to the 

deadline date of October 31, claiming that if a petition is received on October 30, it may 

be difficult for EPA to make appropriate adjustments in the RVO to be published by 

November 30 for the subsequent year. 

The commenter also stated that refineries and importers in Alaska and Hawaii 

may or may not be subject to the RFS depending on their annual production volume, even 

if their respective state opts into the program. The commenter therefore posed a question 

about how EPA will assure that any issues that arise from the RFS program’s opt-in 

provisions for small refineries and state waiver provisions will be reconciled in a uniform

and equitable fashion. 

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Chapter 2: Renewable Fuel Standard 

Letters:

Missouri Department of Natural Resources (MDNR) OAR-2005-0161-0217 

Our Response: 

Regarding the first comment, EPA can only act on (i.e., approve) opt-in petitions 

that are actually submitted by a state or territory. It would be imprudent to act on 

“intent,” as that may change or not be followed through on. Opt-in petitions may be 

submitted at any time before the October 31 deadline for the state or territory’s inclusion 

in the RFS program beginning with the next compliance period. Changing the calculated 

value of the RVO in time for a November 30 publication date is straightforward, and 

would not be hindered by receipt of an opt-in petition on October 31. 

Regarding the second comment, EPA must publish the applicable annual standard 

by November 30 of the previous year. The deadline for opt-in petitions allows EPA 

sufficient time to incorporate the opt-in into the calculation of the standard. To do this, 

EPA only needs information on the total volume of gasoline consumed in the state or 

territory that has opted in. This information is available from the EIA, the same source 

that will be used for gasoline consumption in the 48 contiguous states. Volumes of 

gasoline produced or imported by individual parties located in the opt-in state or territory 

are not relevant to the calculation of the standard. However, because we have subtracted 

the volumes of gasoline produced by exempt small refiners and small refineries from the 

total gasoline produced in the contiguous 48-states in the calculation of the standard, we 

would do the same for small refineries and small refiners in an opt-in state. However, the 

impact on the final value of the standard would be small, as the volumes of gasoline in 

the potential opt-in areas are small, and the volume produced by small refiners and 

refineries in those areas is even smaller. 

2.2.2 Inclusion of Diesel 

What Commenters Said: 

EPA received a comment from the Union of Concerned Scientists (UCS) on the 

exclusion of diesel volumes from RFS and renewable volume obligation (RVO) 

calculations. UCS noted that the RFS program proposal gives renewable credits for 

biodiesel, but conventional and unconventional diesel consumption numbers are not 

included in the calculations for yearly renewable fuel standard and yearly RVOs. The 

commenter expressed concern that if more conventional diesel fuel is used, the renewable 

fuel volume required by the RFS after 2012 could actually go down or at least grow at a 

slower rate than highway fuel demand, and UCS recommended that EPA advise 

Congress on the impacts of their decision to exclude diesel usage in the calculations for 

the RFS and RVO. 

Letters:

Union of Concerned Scientists (UCS) OAR-2005-0161-0226 

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RFS Summary and Analysis of Comments 

Our Response:

The Energy Policy Act requires EPA to establish a program (the RFS program) 

that ensures that the pool of gasoline used in the contiguous 48 states contains specific 

volumes of renewable fuel. 

2.2.3 Cellulosic Ethanol Standard 

What Commenters Said: 

EPA received comments pertaining to the cellulosic ethanol standard included in 

the RFS program. Shell/Motiva commented that it supports EPA’s proposed approach to 

establish a separate obligation for ethanol derived from cellulosic biomass effective in 

2013. The National Wildlife Federation (NWF) commented that it supports EPA’s 

intention to repeat the RFS rulemaking as the renewable fuel industry evolves, and 

suggested that EPA perform an interim assessment to review whether that rulemaking, 

and a potential increase in renewables goals, should occur before 2013. BlueFire Ethanol 

believed that the Renewable Fuel Standard formula and EPA’s RFC for cellulosic ethanol 

(RFCell) should require a minimum 2012 standard of 500 million gallons/yr, or 

suggested that EPA could revise its 2012 minimum 250 million gallon/yr standard for 

cellulosic ethanol upwards once the industry demonstrates its ability to exceed the 250

million gallon/yr 2012 minimum standard. 

Letters:

BlueFire Ethanol OAR-2005-0161-0200, -0224 

National Wildlife Federation (NWF) OAR-2005-0161-0209 

Shell Oil/Motiva OAR-2005-0161-0215 

Our Response:

The Energy Policy Act of 2005, in addition to setting the standards to be adopted 

through 2012, directed EPA to develop the next set of renewable fuel standards for the 

years 2013 and beyond, in coordination with the Departments of Agriculture and Energy, 

based upon the results of a review of the program from 2006-2012. In establishing these 

minimum levels, EPA is to consider the impact of renewable fuel on the environment, air 

quality, energy security, job creation, and rural economic development, as well as the 

expected annual rate of renewable fuel production during those years. Any rulemaking 

regarding the 2013 RFS standard will have to be undertaken several years prior to 2013, 

in order to allow time for proposal and comment, and to provide sufficient time for 

construction in the event that capital improvements by the affected industries are 

necessary for compliance. That rule will consider the current and projected future state 

of the renewable fuel industry, the mix of motor vehicle fuels and technologies, and other 

factors in setting the RFS requirements for 2013 and beyond. 

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Chapter 2: Renewable Fuel Standard 

In addition, the President, in his State of the Union address in January 2007, set 

specific goals for reducing the amount of petroleum fuel used by the transportation 

sector, specifically recommending the adoption of requirements to use 35 billion gallons 

of alternative fuel including renewable fuel by 2017. This volume of fuel would likely 

include significantly higher volumes of renewable fuel compared to the minimum levels 

required under the Energy Act for the RFS program. Much additional analysis would be

required as part of a rulemaking adopting such requirements. 

2.2.4 Data Used 

What Commenters Said: 

We received comments on our use of EIA data for calculating each obligated 

party’s annual RVO. MDNR commented that it believes that EPA should present the 

data points and data periods to be used in calculating the annual RVO. The commenter 

stressed that EPA should explain how we intend to mitigate the effect of the lag time and 

other factors that affect values and figures derived by EIA. NPRA, on the other hand, 

supported EPA’s intent to use the October issue of EIA’s monthly Short Term Energy 

Outlook projection for gasoline demand in 2007 and beyond in order to project next 

calendar year’s gasoline demand in the 48 contiguous states and any EPA-approved RFS 

opt-in areas. 

Letters:

Missouri Department of Natural Resources (MDNR) OAR-2005-0161-0217 

National Petrochemical and Refiners Association (NPRA) OAR-2005-0161-0170, -0232

Our Response: 

In the proposal, we stated that we will use gasoline and renewable projections 

from the EIA Short Term Energy Outlook (STEO) for October of the year prior to the 

year for which the standard is being determined, and we continue to believe, absent any 

other technical input since the proposal, that it provides the best estimate for the coming 

year. We do not expect that any differences between the October STEO values and any 

near-term corrected or adjusted future values of gasoline or renewable fuel projections 

will be significant. Thus no adjustment or mitigation of any effects of lag time or other

factors will be needed.

2.2.5 Other Issues Related To the Standard 

What Commenters Said: 

EPA received general comments on the establishment of the renewable fuel 

standard. MDNR noted that in order to achieve the desired goals of energy independence 

and greater diversity in the Lower 48 states' transportation fuel supply through 2012, 

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RFS Summary and Analysis of Comments 

larger quantities of ethanol and other renewable fuels may be necessary than what is 

called for in the RFS program. SilvaGas emphasized that the RFS target production of 

ethanol gallons per year should be seen as a floor and not as a ceiling on ethanol 

production, and that the general spirit of EPA’s final rule should be to encourage ethanol 

production, not penalize the industry if it can exceed legislative targets. 

Letters:

Missouri Department of Natural Resources (MDNR) OAR-2005-0161-0217 

SilvaGas. OAR-2005-0161-0161 

Our Response: 

The annual volumes of renewable fuel required to be used under the RFS program

are specified in the Energy Act. The Energy Act does not give EPA authority to change 

these required volumes for years 2006 - 2012. The RFS standard is a required minimum;

obligated parties are in no way prohibited from exceeding the required levels, and it 

would certainly be consistent with the purpose and objective of the Act if parties do so. 

Beginning in the 2013 compliance year, EPA must determine the required annual 

volumes in a coordinated effort with the Departments of Agriculture and Energy based on 

a number of criteria specified in the Energy Act and a review of the program during 

calendar years 2006 through 2012. The Energy Act specifies that this review consider 

the impact of the use of renewable fuels on the environment, air quality, energy security, 

job creation, and rural economic development, and the expected annual rate of future 

production of renewable fuels, including cellulosic ethanol. We intend to conduct 

another rulemaking as we approach the 2013 timeframe that would include our review of 

these factors. That rulemaking will present our conclusions regarding the appropriate 

applicable volume of renewable fuel for use in calculating the renewable fuel standard for 

2013 and beyond. The program finalized by today's rule will continue to apply after 

2012, though some elements may be modified in the rulemaking setting the standards for 

2013 and beyond. 

The President's January 2007 State of the Union address recommended the 

adoption of requirements to use 35 billion gallons of alternative fuel including renewable 

fuel by 2017. This goal could also affect the level of applicable standards in a future 

rulemaking. 

2.3 Renewable Volume Obligations 

2.3.1 Refiner vs. Refinery 

What Commenters Said: 

EPA received comments related to the applicability of the RFS to refiners versus 

refineries. Gary-Williams Energy Corporation (GWEC) suggested that to encourage 

more even distribution and use of ethanol across the country, EPA should establish 

ethanol use volume percentages on a refinery basis, rather than the company-wide basis 

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Chapter 2: Renewable Fuel Standard 

that was proposed. The Ad-Hoc Coalition of Small Business Refiners (Small Refiners) 

commented that while small refiners generally endorsed EPA’s proposed RIN system, 

they opposed the company-wide, versus individual facility, compliance basis. 

Letters:

Ad-Hoc Coalition of Small Business Refiners (Small Refiners) 

 OAR-2005-0161-0214 

Gary-Williams Energy Corporation (GWEC) OAR-2005-0161-0207 

Our Response:

We have specified that the RFS provisions must be met by refiners and importers, 

and not by refinery or point of importation. Thus, the RVO must be met by the refiner 

over the total gasoline production of all of its refineries, and by the importer for its total 

volume of gasoline imports regardless of point of entry into the U.S. Furthermore, 

obligated parties are not required to blend renewable fuel into gasoline they produce or 

import, but may satisfy their RVO by acquiring RINs associated with blending renewable 

fuel into the gasoline produced or imported by other obligated parties. Given this “credit 

trading” component of the RFS program, which is required under the Act, establishing 

volume percentages on a refinery basis would not necessarily encourage more even 

distribution and use of ethanol across the country, as the commenter suggests. We note 

that any company with multiple facilities can choose, of its own accord, to assign 

responsibility for RIN acquisition to its individual facilities in proportion to their gasoline 

production or importation. 

2.3.2 Products Included in the RVO Calculation 

What Commenters Said:

In addition to the comment responded to in Section 2.2.2 of this document, EPA 

received a few comments on EPA’s calculation of obligated parties’ annual RVOs. 

Shell/Motiva agreed with EPA’s proposal that the RVO should be based on the amount of 

gasoline and blendstocks for oxygenate blending (BOBs) that a refiner or importer 

produces, but noted that in the final rule, EPA should clarify that the terms RBOB and 

CBOB include CARBOB (California BOB), AZRBOB (Arizona BOB), and LVBOB 

(Las Vegas BOB). Sutherland Asbill & Brennan commented that EPA should clarify 

when obligated parties must include gasoline treated as blendstock as part of their RVO, 

and recommended the approach suggested in the proposal of the importer counting 

gasoline treated as blendstock (GTAB) when it is blended to produce gasoline. API 

commented that the requirement to evaluate the term RBx in §80.1107(b) seemed to 

require tracking all renewables and their volumes to the blend point, and that the RBx 

term simply should be dropped because §80.1107(d) prevents counting renewables 

volume as gasoline volume. 

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RFS Summary and Analysis of Comments 

ExxonMobil also commented on EPA’s definition of the specific gasoline 

volumes that would serve as the basis for the renewable volume obligation, and the 

commenter concurred that renewable fuel volumes should not be counted as gasoline for 

the purpose of calculating the RVO. 

Letters:

American Petroleum Institute (API) OAR-2005-0161-0185 

Exxon/Mobil OAR-2005-0161-0197 

Shell Oil/Motiva OAR-2005-0161-0215 

Sutherland Asbill & Brennan OAR-2005-0161-0210 

Our Response: 

We agree that clarifying that the “BOB” blendstocks are included in the RVO 

calculation would be helpful, and thus have modified the regulations accordingly. 

For purposes of compliance demonstrations, the RFS rule treats GTAB in a 

manner that is consistent with the reformulated gasoline (RFG) and conventional gasoline 

(CG) regulations. The importer includes the GTAB in the volume of gasoline used to 

determine the renewable fuel obligation of the importer in its capacity as a refiner of the 

GTAB, and excludes the GTAB in the volume of gasoline used to determine the 

renewable fuel obligation of the importer in its capacity as an importer. The regulations 

have been clarified with regard to how GTAB is used to determine the GTAB importer’s 

renewable fuels obligation. 

The inclusion of the RBx term is used solely to calculate the non-renewable 

gasoline volume of an obligated party, and it does not refer to, nor is it intended to 

account for, renewable fuel used downstream of the refinery. Thus there is no obligated 

party burden for tracking renewable fuel blended with the obligated party’s gasoline 

outside the “refinery gate.” Therefore this term is being retained for the final rule. 

2.4 Exporters of Renewable Fuel 

2.4.1 RINs on Renewable Fuel for Export 

What Commenters Said:

EPA received comments from three organizations on the assignment and 

retirement of RINs for exported renewable fuel. RFA and Archer Daniels Midland 

Company (ADM) commented that they believe all gallons of renewable fuel should be 

assigned RINs, including renewable fuel exports, in order to maintain a fungible system

and eliminate confusion about which gallons should be assigned RINs and which should 

not. ExxonMobil commented that RINs associated with renewable fuel produced in the 

contiguous 48 states and exported to another country or delivered to Alaska or Hawaii 

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Chapter 2: Renewable Fuel Standard 

should be retired. The commenter stated that the one exception to this requirement would 

be if Alaska or Hawaii decides to opt-in to the program. 

Letters:

Archer Daniels Midland Company (ADM) OAR-2005-0161-0227 

ExxonMobil OAR-2005-0161-0197 

Renewable Fuels Association (RFA) OAR-2005-0161-0192, -0228 (hearing) 

Our Response:

Regarding the comments from RFA and ADM, our final regulations will require 

that producers assign RINs to all renewable fuel, regardless of whether it is for export. 

We also believe that RINs associated with exported volumes of renewable fuel must be

retired. In the final rule, exports are defined in §80.1101 to mean any product that is 

transferred outside the 48 contiguous states, including to locations in Alaska, Hawaii, or a 

U.S. territory, unless one of these areas has opted into the RFS program. 

2.4.2 Renewable Volume Obligation for Exporters 

What Commenters Said:

API and Imperium Renewables Inc. (IRI) commented on our proposal to 

incorporate exporters of renewable fuels into the RFS program. API commented that 

requirements for exporters of renewable fuels (§80.1130) should apply to the physical 

product exported from the 48 contiguous States since an exporter could be anywhere in 

the world. 

IRI commented on the proposed requirement that exporters be assigned an RVO 

equal to the volume of renewable fuel they export adjusted by the equivalence value of

that fuel. IRI was concerned that if an exporter acquires a batch of renewable fuel with 

an equivalence value greater than 1.0 but without extra-value RINs attached, the exporter 

would be required to purchase RINs on the open market in order to meet their RVO. The 

commenter argued that this requirement would place an undue burden on exporters. IRI 

proposed eliminating the need for exporters to retire the extra-value RINs associated with 

the fuel if such extra-value RINs were not assigned to the fuel when it was received by 

the exporter, and cited the fact that EPA proposed to allow similar treatment if all RINs 

had already been separated from the batch when it was received by the exporter and the 

equivalence value could not be determined. IRI also commented that another alternative 

would be to increase the obligation placed on refiners, importers, and blenders of 

gasoline to cover the renewable fuel exported. In this way, the RINs which would have 

been retired by the exporters would be available for purchase from producers by 

obligated parties. 

Letters:

American Petroleum Institute (API) OAR-2005-0161-0185 

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RFS Summary and Analysis of Comments 

Imperium Renewables, Inc. (IRI) OAR-2005-0161-0178 

Our Response:

Our final program maintains the requirement that exporters adopt an RVO just as 

obligated parties do. In the case of exporters, the RVO will be calculated based on the 

volume of renewable fuel exported, adjusted for the Equivalence Value of that volume. 

Exporters will therefore need to acquire sufficient RINs to offset their RVO. The final 

regulations also will require that parties that export renewable fuel from the 48 

contiguous States will be subject to an RVO representing the exported product, regardless 

of the physical location of the exporter. 

We do not believe that IRI has provided compelling reasons to place the burden 

for exported renewable fuel on obligated parties. Not only would this approach have 

required an estimate of the volume of renewable fuel exported in the next year, but would 

also mean that every obligated party would share in accumulating RINs to cover the 

activities of other parties not under their control. 

Exported renewable fuel must be accounted for in the RFS program to the degree 

possible. If the exporter knows the equivalence value associated with the exported 

renewable fuel, or can determine it through other means, it must use this information in 

determining its RVO. It would not be a reasonable approach to ensuring that the 

statutorily required volumes are used in the U.S. to permit exporters to avoid the burden 

of an RVO in cases where the exported product was not received with RINs. 

2.5 Obligated Parties 

EPA received several comments regarding the definition of obligated parties 

under the RFS Program. The Society of Independent Gasoline Marketers of America and 

the National Association of Convenience Stores (SIGMA/NACS), ExxonMobil, Baker 

Commodities, Griffin Industries, Methanol Institute (MI), and API agreed with EPA that 

blenders of products to produce gasoline or diesel fuel are obligated parties under the 

RFS, while oxygenate blenders or parties that only add ethanol to gasoline or biodiesel to 

diesel fuel in small quantities are not obligated parties. SIGMA/NACS commented that 

in the final rule, EPA should clearly distinguish between the terms “blender” and 

“oxygenate blender” to avoid confusion or misinterpretation when the RFS program is 

implemented. The commenter also urged EPA to clarify that a party that blends biodiesel 

into diesel fuel is not considered a "blender," and thus would not be an obligated party 

under the RFS. 

BlueFire Ethanol commented extensively on the principle that blenders should be 

accorded full flexibility to blend any sub-octane, sub-spec gasoline and approved section 

211(f) blending components with ethanol based gasoline at any point in the distribution 

system. The commenter also supported EPA’s proposal not to require CBOB and GTAB 

ethanol blenders to register as obligated parties. 

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Chapter 2: Renewable Fuel Standard 

Shell/Motiva and API commented that they believe that EPA should clarify that 

transmix processors are only required to count as their gasoline production the volumes 

of blendstocks added to finished or unfinished gasoline. API also commented that 

transmix blending operations (as opposed to transmix processors) should be exempt from

RIN obligations when blending at levels not requiring blendstock reporting. 

Letters:

American Petroleum Institute (API) OAR-2005-0161-0185 

Baker Commodities OAR-2005-0161-0003 through -0006, -0173 

BlueFire Ethanol OAR-2005-0161-0200, -0224 

ExxonMobil OAR-2005-0161-0197 

Griffin Industries, Inc.OAR-2005-0161-0189 

Methanol Institute (MI) OAR-2005-0161-0171 

Shell Oil/Motiva OAR-2005-0161-0215 

Society of Independent Gasoline Marketers of America and National Association of 

Convenience Stores (SIGMA/NACS) OAR-2005-0161-0234 

Our Response:

The regulations at §80.1106 specify that obligated parties are refiners and 

importers that produce gasoline or import gasoline, including blenders who blend 

blendstocks into finished gasoline. The regulations do not include as obligated parties 

those persons who produce, import, or blend diesel fuel, or those parties that only add 

renewable fuel to gasoline (including RBOB or CBOB). 

Under the fuels regulations, any party may blend sub-spec gasoline or other 

blendstock(s) with ethanol to produce a finished blend of gasoline, however, such party is 

considered to be a refiner under the fuels regulations. As a refiner, the party is an 

obligated party under the RFS program, and, as such, is responsible for complying with 

the renewable fuel obligation with regard to the finished blend of gasoline. Under the 

RFS program, renewable fuels that are contained in gasoline are not included in the 

volume used to calculate a refiner’s renewable fuel obligation. Therefore, a party that 

blends only ethanol into finished gasoline is not an obligated party under the RFS 

program. This is because the finished gasoline portion of the blend would have been 

included in the volume used to calculate the renewable fuel obligation of the refiner of 

the finished gasoline, and the ethanol is not subject to the RFS obligation. However, a 

party that blends sub-spec gasoline or any other blendstock(s) with ethanol to produce a 

finished blend of gasoline is an obligated party and is responsible for complying with the 

renewable fuel obligation for the non-ethanol portion of the blend. This is because the 

sub-spec gasoline or other blendstock(s) in the finished blend would not have been 

included in the volume used to calculate the renewable fuel obligation of the refiner of 

the sub-spec gasoline or blendstock(s). Under the RFS program, obligated parties are 

required to separate the RINs assigned to any ethanol that they purchase, and blenders of 

renewable fuels are required to separate the RINs assigned to any ethanol that they 

purchase and blend into gasoline. 

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RFS Summary and Analysis of Comments 

Transmix processors and blenders are treated like any other blenders under the 

RFS rule. Transmix processors are parties that separate the gasoline portion of the 

transmix from the transmix and either sell the gasoline portion as finished gasoline or 

blend it with other components to produce gasoline. Transmix processors exclude the 

gasoline portion of the transmix from the volume that is used to determine the party’s 

renewable fuel obligation, since the gasoline portion of the transmix would have been 

included in the volume used to determine the renewable fuels obligation of the refiner or 

importer of the gasoline. In calculating the volume used to determine its renewable fuel 

obligation, the transmix processor would include any blendstocks (other than renewable 

fuels) that are added to the transmix. Where the transmix processor combines the 

gasoline portion of the transmix with purchased finished gasoline, both the gasoline 

portion of the transmix and the finished gasoline would be excluded, since the finished 

gasoline would have been included in the volume used to determine the renewable fuels 

obligation of the refiner or importer of the finished gasoline. Transmix blenders are 

parties that blend small amounts of unseparated transmix into gasoline. Transmix 

blenders are not obligated parties if they only blend transmix into finished gasoline. If 

the transmix blender adds blendstocks to the transmix, the transmix blender would be an 

obligated party with regard to the volume of blendstocks added. The regulations have 

been clarified with regard to how the RFS rule applies to transmix processors and 

blenders. 

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