Federal Register / Vol. 77, No. 195 / Tuesday, October 9, 2012 / Proposed Rules 61313 

Rule 33.7 Part 70 Permits—Notification 

(Adopted 04/10/01) 

Rule 33.8 Part 70 Permits—Reopening of 

Permits (Adopted 10/12/93) 

Rule 33.9 Part 70 Permits—Compliance 

Provisions (Adopted 04/10/01) 

Rule 33.10 Part 70 Permits—General Part 70 

Permits (Adopted 10/12/93) 

Rule 34 Acid Deposition Control (Adopted 

03/14/95) 

Rule 35 Elective Emission Limits (Adopted 

04/12/11) 

Rule 36 New Source Review—Hazardous 

Air Pollutants (Adopted 10/06/98) 

Rule 42 Permit Fees (Adopted 04/12/11) 

Rule 44 Exemption Evaluation Fee 

(Adopted 04/08/08) 

Rule 45 Plan Fees (Adopted 06/19/90) 

Rule 45.2 Asbestos Removal Fees (Adopted 

08/04/92) 

Rule 47 Source Test, Emission Monitor, and 

Call-Back Fees (Adopted 06/22/99) 

Rule 50 Opacity (Adopted 04/13/04) 

Rule 52 Particulate Matter-Concentration 

(Grain Loading) (Adopted 04/13/04) 

Rule 53 Particulate Matter-Process Weight 

(Adopted 04/13/04) 

Rule 54 Sulfur Compounds (Adopted 06/ 

14/94) 

Rule 56 Open Burning (Adopted 11/11/03) 

Rule 57 Incinerators (Adopted 01/11/05) 

Rule 57.1 Particulate Matter Emissions 

From Fuel Burning Equipment (Adopted 

01/11/05) 

Rule 62.7 Asbestos—Demolition and 

Renovation (Adopted 09/01/92) 

Rule 63 Separation and Combination of 

Emissions (Adopted 11/21/78) 

Rule 64 Sulfur Content of Fuels (Adopted 

04/13/99) 

Rule 67 Vacuum Producing Devices 

(Adopted 07/05/83) 

Rule 68 Carbon Monoxide (Adopted 04/13/ 

04) 

Rule 71 Crude Oil and Reactive Organic 

Compound Liquids (Adopted 12/13/94) 

Rule 71.1 Crude Oil Production and 

Separation (Adopted 06/16/92) 

Rule 71.2 Storage of Reactive Organic 

Compound Liquids (Adopted 09/26/89) 

Rule 71.3 Transfer of Reactive Organic 

Compound Liquids (Adopted 06/16/92) 

Rule 71.4 Petroleum Sumps, Pits, Ponds, 

and Well Cellars (Adopted 06/08/93) 

Rule 71.5 Glycol Dehydrators (Adopted 12/ 

13/94) 

Rule 72 New Source Performance Standards 

(NSPS) (Adopted 09/9/08) 

Rule 73 National Emission Standards for 

Hazardous Air Pollutants (NESHAPS 

(Adopted 09/9/08) 

Rule 74 Specific Source Standards 

(Adopted 07/06/76) 

Rule 74.1 Abrasive Blasting (Adopted 11/ 

12/91) 

Rule 74.2 Architectural Coatings (Adopted 

01/12/10) 

Rule 74.6 Surface Cleaning and Degreasing 

(Adopted 11/11/03—effective 07/01/04) 

Rule 74.6.1 Batch Loaded Vapor Degreasers 

(Adopted 11/11/03—effective 07/01/04) 

Rule 74.7 Fugitive Emissions of Reactive 

Organic Compounds at Petroleum 

Refineries and Chemical Plants (Adopted 

10/10/95) 

Rule 74.8 Refinery Vacuum Producing 

Systems, Waste-Water Separators and 

Process Turnarounds (Adopted 07/05/ 

83) 

Rule 74.9 Stationary Internal Combustion 

Engines (Adopted 11/08/05) 

Rule 74.10 Components at Crude Oil 

Production Facilities and Natural Gas 

Production and Processing Facilities 

(Adopted 03/10/98) 

Rule 74.11 Natural Gas-Fired Residential 

Water Heaters-Control of NOX (Adopted 

05/11/10) 

Rule 74.11.1 Large Water Heaters and Small 

Boilers (Adopted 09/14/99) 

Rule 74.12 Surface Coating of Metal Parts 

and Products (Adopted 04/08/08) 

Rule 74.15 Boilers, Steam Generators and 

Process Heaters (Adopted 11/08/94) 

Rule 74.15.1 Boilers, Steam Generators and 

Process Heaters (Adopted 06/13/00) 

Rule 74.16 Oil Field Drilling Operations 

(Adopted 01/08/91) 

Rule 74.20 Adhesives and Sealants 

(Adopted 01/11/05) 

Rule 74.23 Stationary Gas Turbines 

(Adopted 1/08/02) 

Rule 74.24 Marine Coating Operations 

(Adopted 11/11/03) 

Rule 74.24.1 Pleasure Craft Coating and 

Commercial Boatyard Operations 

(Adopted 01/08/02) 

Rule 74.26 Crude Oil Storage Tank 

Degassing Operations (Adopted 11/08/ 

94) 

Rule 74.27 Gasoline and ROC Liquid 

Storage Tank Degassing Operations 

(Adopted 11/08/94) 

Rule 74.28 Asphalt Roofing Operations 

(Adopted 05/10/94) 

Rule 74.30 Wood Products Coatings 

(Adopted 06/27/06) 

Rule 75 Circumvention (Adopted 11/27/78) 

Rule 101 Sampling and Testing Facilities 

(Adopted 05/23/72) 

Rule 102 Source Tests (Adopted 04/13/04) 

Rule 103 Continuous Monitoring Systems 

(Adopted 02/09/99) 

Rule 154 Stage 1 Episode Actions (Adopted 

09/17/91) 

Rule 155 Stage 2 Episode Actions (Adopted 

09/17/91) 

Rule 156 Stage 3 Episode Actions (Adopted 

09/17/91) 

Rule 158 Source Abatement Plans (Adopted 

09/17/91) 

Rule 159 Traffic Abatement Procedures 

(Adopted 09/17/91) 

Rule 220 General Conformity (Adopted 05/ 

09/95) 

Rule 230 Notice To Comply (Adopted 9/9/ 

08) 

* * * * * 

[FR Doc. 2012–24786 Filed 10–5–12; 8:45 am] 

BILLING CODE 6560–50–P 

ENVIRONMENTAL PROTECTION 

AGENCY 

40 CFR Part 80 

[EPA–HQ–OAR–2012–0223; FRL 9733–4 ] 

Regulation of Fuels and Fuel 

Additives: Modifications to Renewable 

Fuel Standard and Diesel Sulfur 

Programs 

AGENCY: Environmental Protection 

Agency (EPA). 

ACTION: Proposed rule. 

SUMMARY: EPA is proposing to amend 

the definition of heating oil in the 

Renewable Fuel Standard (RFS) 

program under section 211(o) of the 

Clean Air Act. This amendment would 

expand the scope of renewable fuels 

that can generate Renewable 

Identification Numbers (RINs) as 

heating oil to include fuel oil produced 

from qualifying renewable biomass that 

would be used to generate heat to warm 

buildings or other facilities where 

people live, work, recreate, or conduct 

other activities. Fuel oils used to 

generate process heat, power, or other 

functions would not be included in the 

amended definition. Producers or 

importers of fuel oil that meets the 

amended definition of heating oil would 

be allowed to generate RINs, provided 

that the fuel oil meets the other 

requirements specified in the RFS 

regulations. This proposed amendment 

would not modify or limit fuel included 

in the current definition of heating oil. 

We are also proposing amendments to 

the diesel sulfur program to provide 

additional flexibility for transmix 

processors that produce locomotive and 

marine diesel fuel. Specifically, we are 

proposing to reinstate an allowance for 

transmix processors to produce 500 

parts per million (ppm) sulfur diesel 

fuel for use in older technology 

locomotive and marine diesel outside of 

the Northeast Mid-Atlantic Area. We are 

also requesting comment on extending 

this allowance to outside of the 

Northeast Mid-Atlantic Area. These 

proposed amendments to the diesel 

transmix provisions are expected to 

result in reduced compliance costs for 

transmix processors and users of 

locomotive and marine diesel fuel while 

having a neutral or positive 

environmental impact. EPA is also 

proposing to amend the fuel marker 

requirements for 500 ppm sulfur 

locomotive and marine (LM) diesel fuel 

to address an oversight in the original 

rulemaking where the regulations failed 

to incorporate provisions described in 

the rulemaking preamble to allow for 


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61314 Federal Register / Vol. 77, No. 195 / Tuesday, October 9, 2012 / Proposed Rules 

solvent yellow 124 marker to transition 

out of the distribution system. 

DATES: Written comments must be 

received on or before November 8, 2012, 

or 30 days from the date of the public 

hearing, if a public hearing is requested. 

A request for a public hearing must be 

received by October 24, 2012. If a public 

hearing is requested, we will publish a 

notice in the Federal Register 

announcing the date and location of the 

hearing at least 14 days prior to the 

hearing. 

ADDRESSES: Submit your comments, 

identified by Docket ID No. EPA–HQ– 

OAR–2012–0223, by the following 

methods: 

• www.regulations.gov: Follow the 

on-line instructions for submitting 

comments. 

• Email: a-and-r-docket@epa.gov, 

Attention Air and Radiation Docket ID 

EPA–HQ–OAR–2012–0223. 

• Fax: 731–214–4051. 

• Mail: Air and Radiation Docket, 

Docket No. EPA–HQ–OAR–2012–0223, 

Environmental Protection Agency, 

Mailcode: 6406J, 1200 Pennsylvania 

Ave. NW., Washington, DC 20460. 

• Hand Delivery: EPA Docket Center, 

EPA/DC, EPA West, Room 3334, 1301 

Constitution Ave. NW., Washington, 

DC, 20460, Attention Air and Radiation 

Docket, ID No. EPA–HQ–OAR–2012– 

0223. Such deliveries are only accepted 

during the Docket’s normal hours of 

operation, and special arrangements 

should be made for deliveries of boxed 

information. 

Instructions: Direct your comments to 

Docket ID No. EPA–HQ–OAR–2012– 

0223. EPA’s policy is that all comments 

received will be included in the public 

docket without change and may be 

made available online at 

www.regulations.gov, including any 

personal information provided, unless 

the comment includes information 

claimed to be Confidential Business 

Information (CBI) or other information 

whose disclosure is restricted by statute. 

Do not submit information that you 

consider to be CBI or otherwise 

protected through www.regulations.gov 

or email. The www.regulations.gov Web 

site is an ‘‘anonymous access’’ system, 

which means EPA will not know your 

identity or contact information unless 

you provide it in the body of your 

comment. If you send an email 

comment directly to EPA without going 

through www.regulations.gov your email 

address will be automatically captured 

and included as part of the comment 

that is placed in the public docket and 

made available on the Internet. If you 

submit an electronic comment, EPA 

recommends that you include your 

name and other contact information in 

the body of your comment and with any 

disk or CD–ROM you submit. If EPA 

cannot read your comment due to 

technical difficulties and cannot contact 

you for clarification, EPA may not be 

able to consider your comment. 

Electronic files should avoid the use of 

special characters, any form of 

encryption, and be free of any defects or 

viruses. For additional information 

about EPA’s public docket visit the EPA 

Docket Center homepage at http://www.

epa.gov/epahome/dockets.htm. 

Docket: All documents in the docket 

are listed in the www.regulations.gov 

index. Although listed in the index, 

some information is not publicly 

available, (e.g., CBI or other information 

whose disclosure is restricted by 

statute). Certain other material, such as 

copyrighted material, will be publicly 

available only in hard copy. Publicly 

available docket materials are available 

either electronically in 

www.regulations.gov or in hard copy at 

the Air and Radiation Docket and 

Information Center, EPA, EPA West, 

Room 3334, 1301 Constitution Ave. 

NW., Washington, DC. The Public 

Reading Room is open from 8:30 a.m. to 

4:30 p.m., Monday through Friday, 

excluding legal holidays. The telephone 

number for the Public Reading Room is 

(202) 566–1744, and the telephone 

number for the Air Docket is (202) 566– 

1742. 

FOR FURTHER INFORMATION CONTACT: 

Kristien Knapp, Office of Transportation 

and Air Quality, Mail Code: 6405J, U.S. 

Environmental Protection Agency, 1200 

Pennsylvania Avenue NW., 20460; 

telephone number: (202) 343–9949; fax 

number: (202) 343–2800; email address: 

knapp.kristien@epa.gov. 

SUPPLEMENTARY INFORMATION: 

I. Executive Summary 

A. Purpose 

EPA is proposing to amend provisions 

in the renewable fuel standard (RFS) 

and diesel sulfur fuel programs. The 

RFS amendment would change the 

definition of home heating oil, and the 

diesel sulfur amendments would 

provide additional flexibility for 

transmix processors who produce 

locomotive and marine diesel fuel, and 

allow solvent yellow 124 marker to 

transition out of the distribution system. 

EPA is proposing these amendments 

under section 211 of the Clean Air Act. 

B. Summary of Today’s Rule 

Amended Definition of Home Heating 

Oil 

EPA proposes to amend the definition 

of heating oil in 40 CFR 80.1401 in the 

renewable fuel standard (‘‘RFS’’ or 

‘‘RFS2’’) program promulgated under 

section 211(o) of the Clean Air Act 

(CAA). This amendment will expand 

the scope of renewable fuels that can 

generate Renewable Identification 

Numbers (‘‘RINs’’) as ‘‘home heating 

oil’’ to include fuel oil that will be used 

to generate heat to warm buildings or 

other facilities where people live, work, 

recreate, or conduct other activities. 

This rule would allow producers or 

importers of fuel oil that meets the 

amended definition of heating oil to 

generate RINs, provided that other 

requirements specified in the 

regulations are met. Fuel oils used to 

generate process heat, power, or other 

functions would not be approved for 

RIN generation under the amended 

definition of heating oil. The proposed 

amendment would not modify, limit, or 

change fuel included in the current 

definition of heating oil at 40 CFR 

80.2(ccc). 

Diesel Transmix Amendments 

The proposed diesel transmix 

amendments would reinstate an 

allowance for transmix processors to 

produce 500 ppm sulfur diesel fuel for 

use in older technology locomotive and 

marine diesel outside of the Northeast 

Mid-Atlantic Area after 2014. EPA’s 

ocean-going vessels rule forbade this 

allowance beginning 2014, because a 

new stream of diesel fuel for oceangoing vessels, containing up to 1000 

ppm sulfur, was introduced at that time, 

which we believed would provide a 

suitable outlet for transmix distillate 

product. Transmix processors stated 

that they were not aware of the changes 

to the 500-ppm LM transmix provisions 

until after they were finalized, and that 

the ocean-going vessels market would 

not be a viable outlet for their distillate 

product. Based on additional input that 

we received from transmix processors 

and other stakeholders in the fuel 

distribution system during our 

consideration of the petition, EPA 

believed that it would be appropriate to 

extend the 500-ppm diesel transmix 

flexibility beyond 2014. EPA finalized a 

settlement agreement and this DFR and 

NPRM are in accord with the settlement 

agreement. Our analysis indicates that 

extending this flexibility beyond 2014 

will have a neutral or net beneficial 

effect on overall emissions. 

Yellow Marker Amendments 

The proposed yellow marker 

amendments address an oversight in 

EPA’s original nonroad diesel 

rulemaking. In that rulemaking, the 

regulations failed to incorporate 

provisions described in the rulemaking 


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Federal Register / Vol. 77, No. 195 / Tuesday, October 9, 2012 / Proposed Rules 61315 

preamble. The preamble made clear that 

EPA intended to allow 500 ppm 

locomotive marine (LM) diesel fuel 

containing greater than 0.10 milligrams 

per liter of Solvent Yellow 124 (SY124) 

time to transition out of the fuel 

distribution system. However, the 

regulations are not consistent with the 

preamble and did not provide this same 

allowance. 

Specifically, the regulations as 

currently written do not provide any 

transition time for unmarked LM fuel 

delivered from a truck loading rack 

beginning June 1, 2012 to work its way 

through the fuel distribution system 

downstream of the truck loading rack. 

The proposed yellow marker 

amendments will allow 500 ppm LM 

diesel fuel at any point in the fuel 

distribution and end use system to 

contain more than 0.10 milligrams per 

liter of SY 124 through November 30, 

2012. This regulatory change would 

allow marked LM diesel fuel to 

transition normally through the LM fuel 

distribution and use system. Today’s 

proposed rule would also amend the 

regulation to clarify the transition of the 

solvent yellow 124 marker out of 

heating oil beginning June 1, 2014. After 

December 1, 2014, EPA proposed to no 

longer have any requirements with 

respect to the use of the SY 124 marker. 

C. Costs and Benefits 

These three sets of proposed 

amendments attempt to provide new 

opportunities for RIN generation under 

the RFS program and necessary 

flexibilities and transition periods for 

those affected by EPA’s transmix and 

marker requirements. Therefore, EPA 

believes that these amendments would 

impose no new direct costs or burdens 

on regulated entities beyond the 

minimal costs associated with reporting 

and recordkeeping requirements. At the 

same time, EPA does not believe that 

any of these amendments will adversely 

impact emissions. 

II. Why is EPA issuing a proposed rule? 

This document proposes to amend the 

definition of heating oil in 40 CFR 

80.1401 in the renewable fuel standard 

(RFS) program that was promulgated 

under section 211(o) of the Clean Air 

Act. This amendment would expand the 

scope of fuels that can generate RINs as 

home heating oil to include fuel oil that 

would be used to generate heat to warm 

buildings or other facilities where 

people live, work, recreate, or conduct 

other activities. This document also 

proposes amendments to the diesel 

sulfur program to provide additional 

flexibility to transmix processors to 

produce locomotive and marine (LM) 

diesel fuel. Specifically, we are 

proposing to reinstate an allowance for 

transmix processors to produce 500 

ppm sulfur diesel fuel for use in older 

technology locomotive and marine 

diesel outside of the Northeast MidAtlantic Area (‘‘NEMA’’). We are also 

requesting comment on extending this 

allowance to the NEMA. These 

proposed amendments to the diesel 

transmix provisions are expected to 

result in reduced compliance costs for 

transmix processors and users of LM 

diesel fuel while having a neutral or 

positive environmental impact. Lastly, 

this document proposes to amend the 

fuel marker requirements for 500 ppm 

sulfur locomotive and marine (LM) 

diesel fuel to address an oversight in the 

original rulemaking where the 

regulations failed to incorporate 

provisions described in the rulemaking 

preamble to allow for solvent yellow 

124 marker to transition out of the 

distribution system. 

We are publishing a separate 

document that will serve as a direct 

final rule in the ‘‘Rules and 

Regulations’’ section of this Federal 

Register. The direct final rule amends 

the definition of heating oil and allows 

transmix processors to produce 

locomotive and marine diesel fuel. The 

direct final rule does not attempt to 

extend the transmix allowance to the 

NEMA; we request comments on that 

issue only in this document. If we 

receive no adverse comment on the 

direct final rule, or any portion of the 

direct final rule, by the date provided in 

the DATES section above, the 

amendments to the definition of heating 

oil and the amendments to the diesel 

transmix provisions that apply outside 

the NEMA will become final. If EPA 

receives relevant adverse comment on 

the direct final rule, any portion of the 

direct final rule, or a hearing request, we 

will publish a timely withdrawal of the 

direct final rule or the portion receiving 

adverse comments in the Federal 

Register. 

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. 

III. Does this action apply to me? 

Entities potentially affected by this 

action include those involved with the 

production, distribution and sale of 

transportation fuels, including gasoline 

and diesel fuel, or renewable fuels such 

as ethanol and biodiesel, as well as 

those involved with the production, 

distribution and sale of other fuel oils 

that are not transportation fuel. 

Regulated categories and entities 

affected by this action include: 

Category NAICS codes a SIC codes b Examples of potentially regulated parties 

Industry ............................................................. 324110 2911 Petroleum refiners, importers. 

Industry ............................................................. 325193 2869 Ethyl alcohol manufacturers. 

Industry ............................................................. 325199 2869 Other basic organic chemical manufacturers. 

Industry ............................................................. Various Various Transmix Processors 

Industry ............................................................. 424690 5169 Chemical and allied products merchant wholesalers. 

Industry ............................................................. 424710 5171 Petroleum bulk stations and terminals. 

Industry ............................................................. 424720 5172 Petroleum and petroleum products merchant wholesalers. 

Industry ............................................................. 454319 5989 Other fuel dealers. 

a North American Industry Classification System (NAICS). 

bStandard 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. 


wreier-aviles on DSK5TPTVN1PROD with PROPOSALS
61316 Federal Register / Vol. 77, No. 195 / Tuesday, October 9, 2012 / Proposed Rules 

1The Energy Independence and Security Act 

(EISA) of 2007 amended section 211(o) of the Clean 

Air Act (CAA), which was originally added by the 

Energy Policy Act (EPAct) of 2005. 

2 ‘‘EISA changed the definition of ‘renewable fuel’ 

to require that it be made from feedstocks that 

qualify as ‘renewable biomass.’ EISA’s definition of 

the term ‘renewable biomass’ limits the types of 

biomass as well as the types of land from which the 

biomass may be harvested.’’ Regulation of Fuels and 

Fuel Additives: Changes to Renewable Fuel 

Standard Program, 75 FR 14670, 14681 (March 26, 

2010). 

3See CAA sections 211(o)(1)(A) and (o)(5)(E). 4 75 FR 14670, 14687 (March 26, 2010). 

IV. What should I consider as I prepare 

my comments for EPA? 

A. Submitting information claimed as 

CBI. Do not submit this information 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 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. 

V. Renewable Fuel Standard Program 

Amendments 

A. Amended Definition of Heating Oil 

EPA is issuing this proposed rule to 

amend the definition of heating oil in 40 

CFR 80.1401 in the renewable fuel 

standard (‘‘RFS’’ or ‘‘RFS2’’) program 

promulgated under section 211(o) of the 

Clean Air Act (CAA).1 This amendment 

would expand the scope of renewable 

fuels that can generate Renewable 

Identification Numbers (RINs) as ‘‘home 

heating oil’’ to include fuel oil that 

would be used to generate heat to warm 

buildings or other facilities where 

people live, work, recreate, or conduct 

other activities. This proposed rule 

would allow producers or importers of 

fuel oil that meets the amended 

definition of heating oil to generate 

RINs, provided that other requirements 

specified in the regulations are met. 

Fuel oils used to generate process heat, 

power, or other functions will not be 

approved for RIN generation under the 

amended definition of heating oil, as 

these fuels are not within the scope of 

‘‘home heating oil’’ as that term is used 

in the Energy Independence and 

Security Act of 2007 (‘‘EISA’’), for the 

RFS program. The proposed amendment 

would not modify or limit fuel included 

in the current definition of heating oil 

at 40 CFR 80.2(ccc). 

The RFS2 program requires the 

production and use of renewable fuel to 

replace or reduce the quantity of fossil 

fuel present in transportation fuel. 

Under EPA’s RFS program this is 

accomplished by providing for the 

generation of RINs by producers or 

importers of qualified renewable fuel. 

RINs are transferred to the producers or 

importers of gasoline and diesel 

transportation fuel who then use the 

RINs to demonstrate compliance with 

their renewable fuel volume obligations. 

RINs also serve the function of credits 

under the RFS program. 

Congress provided that EPA could 

also establish provisions for the 

generation of credits by producers of 

certain renewable fuel that was not used 

in transportation fuel, called ‘‘additional 

renewable fuel.’’ 2 Additional renewable 

fuel is defined as fuel that is produced 

from renewable biomass and that is 

used to replace or reduce the quantity 

of fossil fuel present in home heating oil 

or jet fuel.3 In essence, additional 

renewable fuel has to meet all of the 

requirements applicable to qualify it as 

renewable fuel under the regulations, 

with the only difference being that it is 

blended into or is home heating oil or 

jet fuel. This does not change the 

volume requirements of the statute 

itself, however this can provide an 

important additional avenue for parties 

to generate RINs for use by obligated 

parties, thus promoting the overall costeffective production and use of 

renewable fuels. 

EPA addressed the provision for 

additional renewable fuels in the RFS2 

rulemaking, specifically addressing the 

category of ‘‘home heating oil.’’ EPA 

determined that this term was 

ambiguous, and defined it by 

incorporating the existing definition of 

heating oil at 40 CFR 80.2(ccc). EPA 

stated that: 

EISA uses the term ‘‘home heating oil’’ in 

the definition of ‘‘additional renewable fuel.’’ 

The statute does not clarify whether the term 

should be interpreted to refer only to heating 

oil actually used in homes, or to all fuel of 

a type that can be used in homes. We note 

that the term ‘home heating oil’ is typically 

used in industry in the latter manner, to refer 

to a type of fuel, rather than a particular use 

of it, and the term is typically used 

interchangeably in industry with heating oil, 

heating fuel, home heating fuel, and other 

terms depending on the region and market. 

We believe this broad interpretation based on 

typical industry usage best serves the goals 

and purposes of the statute. If EPA 

interpreted the term to apply only to heating 

oil actually used in homes, we would 

necessarily require tracking of individual 

gallons from production through ultimate 

[use] in homes in order to determine 

eligibility of the fuel for RINs. Given the 

fungible nature of the oil delivery market, 

this would likely be sufficiently difficult and 

potentially expensive so as to discourage the 

generation of RINs for renewable fuels used 

as home heating oil. This problem would be 

similar to that which arose under RFS1 for 

certain renewable fuels (in particular 

biodiesel) that were produced for the 

highway diesel market but were also suitable 

for other markets such as heating oil and 

non-road applications where it was unclear 

at the time of fuel production (when RINs are 

typically generated under the RFS program) 

whether the fuel would ultimately be eligible 

to generate RINs. Congress eliminated the 

complexity with regards to non-road 

applications in RFS2 by making all fuels 

used in both motor vehicle and nonroad 

applications subject to the renewable fuel 

standard program. We believe it best to 

interpret the Act so as to also avoid this type 

of complexity in the heating oil context. 

Thus, under today’s regulations, RINs may be 

generated for renewable fuel used as ‘heating 

oil,’ as defined in existing EPA regulations at 

§ 80.2(ccc). In addition to simplifying 

implementation and administration of the 

Act, this interpretation will best realize the 

intent of EISA to reduce or replace the use 

of fossil fuels.4

The existing definition of heating oil 

at 40 CFR § 80.2(ccc) means ‘‘any #1, #2, 


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5This is different from other renewable fuels in 

the RFS program, which are defined in terms of 

their use as transportation fuel or jet fuel. See 40 

CFR 80.1401, definitions of ‘‘renewable fuel’’ and 

‘‘transportation fuel.’’ 

or non-petroleum diesel blend that is 

sold for use in furnaces, boilers, 

stationary diesel engines, and similar 

applications and which is commonly or 

commercially known or sold as heating 

oil, fuel oil, or similar trade names, and 

that is not jet fuel, kerosene, or [Motor 

Vehicle, Nonroad, Locomotive, and 

Marine (MVNRLM)] diesel fuel.’’ The 

existing definition of non-petroleum 

diesel at 40 CFR 80.2(sss) means a diesel 

that contains at least 80 percent monoalkyl esters of long chain fatty acids 

derived from vegetable oils or animal 

fats. Thus, in order to generate RINs for 

home heating oil that is a nonpetroleum diesel blend, the fuel must 

contain at least 80 percent mono-alkyl 

esters of long chain fatty acids derived 

from vegetable oils or animal fats, as 

well as meeting all other requirements 

of the RFS2 regulations. Since the 

promulgation of the RFS2 final rule, we 

have received a number of requests from 

producers to consider expanding the 

scope of the home heating oil provision 

to include additional fuel oils that are 

produced from qualifying renewable 

biomass but do not meet the regulatory 

definition of heating oil because they 

are not #1 or #2 diesel and do not 

contain at least 80 percent mono-alkyl 

esters. Parties raising this issue have 

suggested that limiting ‘‘home heating 

oil’’ to the fuel types defined in 40 CFR 

80.2(ccc) disqualifies certain types of 

renewable fuel oils that could be used 

for home heating and that this limitation 

does not align with our reasoning in the 

preamble to take a broad interpretation 

of the term ‘‘home heating oil’’ in CAA 

section 211(o). 

EPA has considered this issue further 

and is proposing to revise the definition 

of heating oil in the RFS program to 

expand the scope of fuels that can 

generate RINs as heating oil. EPA is 

proposing to revise the definition such 

that RINs also may be generated by 

renewable fuel that is fuel oil and is 

used to heat interior spaces of homes or 

buildings to control ambient climate for 

human comfort. This would not include 

fuel oils used to generate process heat, 

power, or other functions. The fuel oil 

would be used to generate heat to warm 

buildings or other facilities where 

people live, work, recreate, or conduct 

other activities. The fuel oil would only 

be used in heating applications, where 

the sole purpose of the fuel’s use is for 

heating and not for any other combined 

use such as process energy use. We are 

proposing to amend the existing 

definition of heating oil in 40 CFR 

§ 80.1401 to include fuel oils that are 

used in this way. This is in addition to 

the fuel oils currently included in the 

definition of heating oil at 40 CFR 

§ 80.2(ccc), and would not modify or 

limit the fuel included in the current 

definition. 

EPA believes this expansion of the 

scope of the home heating oil provision 

is appropriate and authorized under 

CAA section 211(o). As EPA described 

in the RFS2 final rule, Congress did not 

define the term ‘‘home heating oil,’’ and 

it does not have a fixed or definite 

commercial meaning. In the RFS2 final 

rulemaking, EPA focused on whether 

the provision was limited to heating oil 

actually used in homes. EPA noted that 

the term home heating oil is usually 

used in the industry to refer to a type 

of fuel, and not to one specific use for 

the fuel. Given this more specific usage 

of the term, and the practical barriers 

that would arise if the term was defined 

as fuel actually used to heat homes, EPA 

defined the scope of home heating oil by 

identifying those types of fuel oils that 

are typically used to heat homes. EPA 

determined this was a reasonable 

interpretation of an ambiguous statutory 

provision that simplified 

implementation and administration of 

the Act and promoted achievement of 

the goals of the RFS program. 

In the RFS2 rulemaking, EPA focused 

on the kinds of fuel oils that can be used 

to heat homes. The expansion of the 

definition proposed in this rulemaking 

would address two types of fuel oils not 

included in the current definition of 

heating oil. First, the proposed 

definition would include additional fuel 

oils that are actually used to heat 

homes, even if they do not meet the 

current definition of heating oil. This is 

clearly within the scope of the statutory 

provision for home heating oil. 

Second, the proposed definition 

would include fuel oils that are used to 

heat facilities other than homes to 

control ambient climate for human 

comfort. Under the current definition of 

heating oil, a fuel oil meets the 

definition based on its physical 

properties and its use in furnaces, 

boilers, stationary diesel engines, and 

similar applications, not whether it is 

actually used to heat a home. The basic 

decision made in the RFS2 final 

rulemaking was to allow RIN generation 

for the group of fuel oils that are 

typically used for home heating 

purposes. Under the current definition 

the relationship of the fuel oil to heating 

homes is that the fuel oil is of the type 

that is typically used for and can be 

used for that purpose.5

In the proposed amended definition, 

qualifying fuel oils would be used for 

heating places where people live, work, 

or recreate, and not just their homes. It 

focuses more on what is getting 

heated—people—and not where the 

people are located. EPA believes this is 

a reasonable interpretation of the phrase 

‘‘home heating oil,’’ while recognizing 

that it is not an obvious interpretation. 

This interpretation recognizes the 

ambiguity of the phrase used by 

Congress, which is not defined and does 

not have a clear and definite 

commercial meaning. It gives reasonable 

meaning to the term home heating oil, 

by limiting the additional fuel oils to 

fuel oils when used for heating of 

facilities that people will occupy, and 

excluding fuel oils when used for other 

purposes such as generation of energy 

used in the manufacture of products. It 

also focuses on the aspect of home that 

is important here—the heating of 

people—recognizing that EPA has 

already determined that fuel oil can be 

included in the scope of home heating 

oil even if it is not actually used to heat 

a home. This interpretation will also 

promote the purposes of the EISA and 

the RFS program. It will promote the 

purposes of the EISA in that it will 

increase the production and use of 

renewable fuels by introducing new 

sources of fuel producers to the RFS 

program. It will specifically promote the 

RFS programmatic goals by facilitating 

the generation of RINs for renewable 

fuels that reduce emissions of 

greenhouse gases compared to fossil 

fuels. For example, EPA has received 

information from Envergent 

Technologies (an alliance of Ensyn and 

Honeywell) that such an expanded 

definition of heating oil would result in 

nearly immediate production of 3.5 

million gallons from their existing 

facilities, with an additional projected 

production of up to 45 million gallons 

per year within 24 months following 

regulatory action. Based on this 

information from Envergent 

Technologies, application of the 

expanded definition of heating oil to the 

entire industry would result in the 

production of many more million 

additional gallons of renewable fuel. 

Although EPA believes the expanded 

definition in the regulations of ‘‘heating 

oil’’ would be a reasonable 

interpretation of the intent of Congress 

to allow additional renewable fuel to 

count towards the volume mandates if 

it is produced from renewable biomass 

and is used to replace or reduce the 

quantity of fossil fuel present in home 

heating oil, EPA invites comment on 

this interpretation. 


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6See Table 1 to 40 CFR 80.1426. 

7This describes the Fischer-Tropsch process. 

Other processes rely on forming different sets of 

compounds from the biomass, and then producing 

the fuel product from the set of compounds. 

8 ‘‘Regulation of Fuel and Fuel Additives; 

Changes to Renewable Fuel Standard Program,’’ 75 

FR 14670, available at http://www.gpo.gov/fdsys/ 

pkg/FR-2010-03-26/pdf/2010-3851.pdf. See also, 

EPA’s summary factsheet, ‘‘EPA Lifecycle Analysis 

of Greenhouse Gas Emissions from Renewable 

Fuels,’’ available at http://www.epa.gov/otaq/ 

renewablefuels/420f10006.pdf. 

For the text of the proposed regulatory 

changes please see the direct final rule, 

located in the ‘‘Rules and Regulations’’ 

section of this Federal Register. 

B. Lifecycle Greenhouse Gas Assessment 

of the Amended Definition of Heating 

Oil 

EPA has also evaluated whether any 

revisions would need to be made to 

Table 1 to 40 CFR 80.1426 that lists the 

applicable D codes for each fuel 

pathway for use in generating RINs in 

the RFS2 regulations in light of the 

additional fuel oils included in the 

expanded definition of heating oil. As 

discussed below, EPA has determined 

that the applicable D code entries for 

heating oil in Table 1 to 40 CFR 80.1426 

would continue to be appropriate and 

would not need to be revised in light of 

the expanded definition of heating oil. 

Under the RFS program, EPA must 

assess lifecycle greenhouse gas (GHG) 

emissions to determine which fuel 

pathways meet the GHG reduction 

thresholds for the four required 

renewable fuel categories. The RFS 

program requires a 20% reduction in 

lifecycle GHG emissions for 

conventional renewable fuel (except for 

grandfathered facilities and volumes), a 

50% reduction for biomass-based diesel 

or advanced biofuel, and a 60% 

reduction for cellulosic biofuel. For the 

final RFS2 rule, EPA assessed the 

lifecycle greenhouse gas emissions of 

multiple renewable fuel pathways and 

classified pathways based on these GHG 

thresholds, as compared to the EISA 

statutory baseline.6 In addition, EPA has 

added several pathways since the final 

rule was published. Expanding the 

definition of heating oil does not affect 

these prior analyses. 

The fuel pathways consist of fuel 

type, feedstock, and production process 

requirements. GHG emissions are 

assessed at all points throughout the 

lifecycle pathway. For instance, 

emissions associated with sowing and 

harvesting of feedstocks and in the 

production, distribution and use of the 

renewable fuel are examples of what are 

accounted for in the GHG assessment. A 

full accounting of emissions is then 

compared with the petroleum baseline 

emissions for the transportation fuel 

being replaced. The lifecycle GHG 

emissions determination is one factor 

used to determine compliance with the 

regulations. 

There are currently several fuel 

pathways that list heating oil as a fuel 

type with various types of feedstock and 

production processes used, qualifying 

the heating oil pathways as either 

biomass-based diesel, advanced, or 

cellulosic. The determinations for these 

different pathways were based on the 

current definition of heating oil. The 

pathways also include several types of 

distillate product including diesel fuel, 

jet fuel and heating oil. 

The lifecycle calculations and 

threshold determinations are based on 

the GHG emissions associated with 

production of the fuel and processing of 

the feedstock. Converting biomass 

feedstocks such as triglycerides (if oils 

are used as feedstock) or hemi-cellulose, 

cellulose, lignin, starches, etc. (if solid 

biomass feedstock is used) into heating 

oil products and can be accomplished 

through either a biochemical or 

thermochemical process converting 

those molecules into a fuel product. The 

existing heating oil pathways were 

based on the current definition of the 

fuel, and were based on a certain level 

of processing to produce #1, #2, or a 

non-petroleum diesel blend and the 

related energy use and GHG emissions 

that were part of the lifecycle 

determination for those fuel pathways. 

The main difference between the 

current definition of heating oil, which 

refers to #1, #2, or a non-petroleum 

diesel blend, and the expanded 

definition that is proposed in this 

rulemaking is that the expanded 

definition would include heavier types 

of fuel oil with larger molecules. Based 

on the type of conversion process, 

producing these heavier fuel oil 

products versus the #1, #2, or a nonpetroleum diesel blend would affect the 

amount of energy used and therefore the 

GHG emissions from the process. There 

are two main paths for producing a fuel 

oil product from biomass. In one the 

biomass is converted into a biocrude 

which is further refined into lighter 

products. In this case producing a 

heavier fuel oil product would require 

less processing energy and have lower 

GHG emissions than converting the 

same feedstock into a #1, #2, or nonpetroleum diesel blend. 

In the other type of process the 

compounds in the biomass are changed 

into a set of intermediary products, such 

as hydrogen (H) and carbon monoxide 

(CO).7 These compounds are then either 

catalytically or biochemically converted 

into the fuel product. In this case, the 

vast majority of the energy is associated 

with breaking down the feedstock into 

the set of intermediary compounds. The 

process used and the energy needed for 

it does not vary based on the type of fuel 

that is then produced from these 

intermediary compounds. The type of 

fuel could affect the type of catalyst or 

biological process used to change the 

intermediary compounds into the fuel 

product, but based on EPA calculations 

and assessments developed as part of 

the RFS2 rulemaking,8 this will have no 

real impact on the energy used or the 

GHG emissions associated with 

converting the biomass into a different 

fuel product. 

Based on these considerations, EPA 

believes the GHG emissions associated 

with producing the fuel oil included in 

the expanded definition would be the 

same or lower than the GHG emissions 

associated with producing #1, #2, or 

non-petroleum diesel blend. Therefore, 

EPA believes the prior life cycle 

analysis for heating oil would support 

applying the existing pathways for fuel 

oil in the RFS2 regulations to the 

expanded definition of heating oil. All 

of the pathways currently applicable to 

heating oil under Table 1 to 40 CFR 

80.1426 would apply to the expanded 

definition of heating oil. EPA invites 

comments whether there are any other 

factors to consider in addition to the 

reasons discussed above for extending 

the lifecycle analysis already conducted 

for heating oil in the final rulemaking 

for fuel oils under the expanded 

definition of heating oil. 

For the text of the proposed regulatory 

changes please see the direct final rule, 

located in the ‘‘Rules and Regulations’’ 

section of this Federal Register. 

C. Additional Registration, Reporting, 

Product Transfer Document and 

Recordkeeping Requirements 

1. Additional Requirements for the 

Amended Definition of Heating Oil 

An important issue to address is how 

to implement such an expanded 

definition. As EPA recognized in the 

RFS2 rulemaking, fuel oils end up being 

used in a variety of different uses, where 

the fuel producer may have little 

knowledge at the time of production as 

to eventual use of the fuel. This is 

especially the case where the fuel oil is 

distributed in a fungible distribution 

system. EPA addressed this in the RSF2 

rulemaking by defining home heating 

oil as a type of fuel with certain 

characteristics, irrespective of where it 

was used. This approach avoided the 

need to track the fuel to its actual use, 


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9EPA does not expect that the expanded 

definition of home heating oil will result in an 

obligation on home owners or small businesses. 

Based on our analysis of the market, qualifying fuel 

oil is expected to be used in large industrial settings 

or apartment buildings, not in individual homes. 

Therefore, EPA anticipates that the information it 

is requiring would be readily available and 

producible by these entities. 

and including the characteristics of the 

fuel in its definition in 40 CFR 80.1401 

was adequate to retain a close tie to the 

concept underlying home heating oil. 

The proposed expansion of the 

definition raises this same issue but in 

a more significant way. While the 

proposed expansion of the definition 

includes some limited physical 

characteristics that fuel oils would need 

to meet in order to qualify for generating 

RINs, it does not provide sufficient 

specificity to differentiate between those 

fuels oils used to heat buildings for 

climate control for human comfort and 

those used to generate process heat or 

other purposes. Therefore, for eligible 

fuel oils other than those qualifying 

under the existing definition in 40 CFR 

80.2(ccc), EPA is proposing that the 

renewable fuel producer or importer 

have adequate documentation to 

demonstrate that the fuel oil volume for 

which RINs were generated was used to 

heat buildings for climate control for 

human comfort and meets the expanded 

definition of heating oil in order to 

generate RINs. 

EPA recognizes that under the current 

definition of heating oil no tracking or 

other documentation of end use is 

required, and some heating oils that 

meet the current definition could end 

up being used for other purposes. 

However, in all cases the heating oil 

under the current definition has to have 

the physical or other characteristics that 

tie it to the type of fuel oil used to heat 

homes. In addition, because these fuel 

oils would qualify to generate RINs 

under the RFS program, it will likely 

lead to their use for heating of buildings, 

and not for generation of process heat. 

For the fuel oils included in the 

expanded definition, the tie to home 

heating oil would not be the physical 

characteristics of the fuel oil but instead 

its actual usage for heating for the 

purposes of climate control for human 

comfort. 

In order to verify that the fuel oils are 

actually used to generate heat for 

climate control purposes, EPA is 

proposing the following registration, 

recordkeeping, product transfer 

document (PTD) and reporting 

requirements. These proposed 

requirements would not apply to fuels 

qualifying under existing 40 CFR 

80.2(ccc) of the regulations. We are also 

proposing that if RINs are generated for 

fuel oils under the expansion of the 

scope of home heating oil in today’s 

rule, and those fuel oils are designated 

for but not actually used to generate 

heat for climate control purposes, but 

for some other purpose, all parties 

involved in either the generation, 

assignment, transfer or use of that RIN, 

including the end user of that fuel oil, 

are subject to and liable for violations of 

the RFS2 regulations and the CAA. 

For the text of the proposed regulatory 

changes please see the direct final rule, 

located in the ‘‘Rules and Regulations’’ 

section of this Federal Register. 

a. Registration 

For the purpose of registration, EPA is 

proposing to allow the producer of the 

expanded fuel oil types to establish 

their facility’s baseline volume in the 

same manner as all other producers 

under the RFS program, e.g., based on 

the facility’s permitted capacity or 

actual peak capacity. Additionally 

though, we are proposing to require 

producers of the expanded fuel oil types 

to submit affidavits in support of their 

registration, including a statement that 

the fuel will be used for the purposes of 

heating interior spaces of homes or 

buildings to control ambient climate for 

human comfort, and no other purpose. 

We also propose to require that 

producers submit secondary affidavits 

from the existing end users to verify that 

the fuel is actually being used for a 

qualifying purpose. We are also 

proposing new reporting, product 

transfer documents (PTD), and 

recordkeeping requirements discussed 

below that will be used as a means for 

verification that the qualifying fuel is 

being used in an approved application. 

We believe these requirements are 

necessary to assure confidence that the 

fuel used to generate RINs is actually 

used for a qualifying purpose because 

these types of fuel have not previously 

been used as heating oil, and are not 

readily identifiable by their physical 

characteristics. Without such 

safeguards, EPA could not be confident 

that the fuel is used as heating oil, and 

end users might not have adequate 

notice that the fuel must be used as 

heating oil. EPA believes these 

requirements will place a small burden 

on producers and end users, and greatly 

benefit the integrity of the program. 

The proposed registration 

requirements are detailed in the 

registration section in 40 CFR 

80.1450(b)(1)(ix) in the direct final rule 

located in the ‘‘Rules and Regulations’’ 

section of this Federal Register. 

b. Reporting, Product Transfer 

Documents and Recordkeeping 

Requirements 

For the purpose of continued 

verification after registration, EPA is 

proposing additional requirements for 

reporting in § 80.1451(b)(1)(ii)(T), PTDs 

in § 80.1453(d), and recordkeeping in 40 

CFR 80.1454(b), for the expanded fuel 

oil types. 

The proposed reporting, PTD, and 

recordkeeping requirements will help 

ensure that the expanded fuel oil types 

that are used to generate RINs are 

actually used in a qualifying 

application. For reporting, producers 

would be required to file quarterly 

reports with EPA that identify certain 

information about the volume of fuel oil 

produced and used as heating oil. The 

additional reporting requirements 

would stipulate that the producer of fuel 

oils submit affidavits to EPA reporting 

the total quantity of the fuel oils 

produced, the total quantity of the fuel 

oils sold to end users, and the total 

quantity of fuel oils sold to end users for 

which RINs were generated. 

Additionally, affidavits from each end 

user would need to be obtained by the 

producer and reported to EPA, 

describing the total quantity of fuel oils 

received from the producer, the total 

amount of fuel oil used for qualifying 

purposes, the date the fuel oil was 

received from the producer, the blend 

level of the fuel oil, quantity of assigned 

RINs received with the renewable fuel, 

and quantity of assigned RINs that the 

end user separated from the renewable 

fuel, if applicable.9 The additional 

product transfer document requirement 

associated with the expanded definition 

of heating oil would require that a PTD 

must be prepared and maintained 

between the fuel oil producer and the 

final end user for the legal transfer of 

title or custody of a specific volume of 

fuel oil that is designated for use, and 

is actually used, only for the purpose of 

heating interior spaces of buildings to 

control ambient climate for human 

comfort. This additional PTD 

requirement would require that the PTD 

used to transfer ownership or custody of 

the renewable fuel must contain the 

statement: ‘‘This volume of renewable 

fuel is designated and intended to be 

used to heat interior spaces of homes or 

buildings to control ambient climate for 

human comfort. Do NOT use for process 

heat or any other purpose, pursuant to 

40 CFR 80.1460(g).’’ EPA believes that 

this PTD requirement will help to 

ensure that each gallon of fuel oil that 

is transferred from the producer to the 

end user is used for qualifying purposes 

under the expanded definition of 

heating oil. If the fuel oil is sent to the 

end user, but the fuel oil is not actually 


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61320 Federal Register / Vol. 77, No. 195 / Tuesday, October 9, 2012 / Proposed Rules 

10Control of Emissions of Air Pollution from 

Nonroad Diesel Engines and Fuel, Final Rule, 69 FR 

38958 (June 24, 2004). 

11As discussed in the original nonroad diesel 

rulemaking, as LM equipment is retired from 

service, the market for 500 ppm LM will gradually 

diminish and eventually disappear. Given the long 

lifetime of LM equipment (in many cases 40 years 

or more), we anticipate that a market for 500 ppm 

LM will remain for a significant amount of time. 

This phase-out time will also allow transmix 

processors to transition to their >15ppm sulfur 

used to generate heat for climate control 

purposes, but for some other nonqualifying purpose, then the RINs that 

were generated for that fuel oil would 

need to be immediately retired and 

reported under 40 CFR 80.1451. The 

additional recordkeeping requirement 

we are proposing would require that 

producers keep copies of the contracts 

which describe the fuel oil under 

contract with each end user. Consistent 

with existing regulations, producers are 

required to maintain all documents and 

records submitted for registration, 

reporting, and PTDs as part of the 

producer’s recordkeeping requirements. 

EPA believes the producer’s 

maintenance of these records will allow 

for continued tracking and verification 

that the end use of the fuel oil is in 

compliance with the expanded 

definition of heating oil. 

The proposed reporting, PTD, and 

recordkeeping requirements are detailed 

in the direct final rule located in the 

‘‘Rules and Regulations’’ section of this 

Federal Register. EPA invites comments 

for any other factors to consider 

regarding these additional requirements 

for registration, reporting, PTDs, and 

recordkeeping. 

D. Additional Requirement for RIN 

Generation 

We are also proposing to amend the 

regulatory text that describes the general 

requirements for how RINs are 

generated and assigned to batches of 

renewable fuel by renewable fuel 

producers and importers. This would 

explicitly clarify a requirement that 

always existed: That producers and 

importer of renewable fuel who generate 

RINs must comply with the registration 

requirements of 40 CFR § 80.1450, the 

reporting requirements of 40 CFR 

80.1451, the recordkeeping 

requirements of 40 CFR 80.1454, and all 

other applicable regulations of this 

subpart M. This is a generally applicable 

requirement—not specific to fuel 

meeting the definition of home heating 

oil. See amended section 

80.1426(a)(1)(iii). 

VI. Amendments Related to Transmix 

The final regulations for the nonroad 

diesel program were published in the 

Federal Register on June 24, 2004 (69 

FR 38958). The provisions in the 

nonroad diesel rule related to transmix 

processors were modified by the 

Category 3 Marine diesel final rule that 

was published on April 30, 2010 (75 FR 

22896). This action proposes additional 

amendments to the requirements for 

diesel fuel produced by transmix 

processors. Below is a table listing the 

provisions that we are proposing to 

amend. The following sections provide 

a discussion of these proposed 

amendments and of additional potential 

changes to the diesel transmix 

provisions that we are considering. 

Proposed amendments to the 

diesel program section Description 

80.511(b)(4) .................................... Amended to allow for the production and sale of 500-ppm locomotive and marine (LM) diesel fuel produced from transmix past 2014. 

80.513 (entire section) .................... Amended to allow for the production and sale of 500-ppm LM diesel fuel produced from transmix past 

2014. 

80.572(d) ......................................... Amended to extend 500ppm LM diesel fuel label past 2012. 

80.597(d)(3)(ii) ................................ Amended to include 500-ppm LM diesel fuel in the list of fuels that an entity may deliver or receive custody 

of past June 1, 2014. 

A. Consideration of Extending the Diesel 

Transmix Provisions Outside of the 

Northeast Mid-Atlantic Area and Alaska 

Beyond 2014 

Batches of different fuel products 

commonly abut each other as they are 

shipped in sequence by pipeline. When 

the mixture between two adjacent 

products is not compatible with either 

product, it is removed from the pipeline 

and segregated as transmix. Transmix 

typically is gathered for reprocessing at 

the end of the fuel distribution system 

far from a refinery. In addition to the 

long transportation distances to return 

transmix to a refinery for reprocessing, 

incorporating transmix into a refinery’s 

feed also presents technical and 

logistical refining process challenges 

that typically make refinery 

reprocessing an unattractive option. 

Thus, transmix processers provide a 

valuable service in maintaining an 

efficient fuel distribution system. 

Transmix processing facilities handle 

very low volumes of fuel compared to 

a refinery and hence are limited to the 

use of a simple distillation tower and 

additional blendstocks to manufacture 

finished fuels. There is currently no 

desulfurization equipment which has 

been demonstrated to be suitable for 

application at a transmix processor 

facility. The cost of installing and 

operating a currently available 

desulfurization unit is too high in 

relation to the small volume of distillate 

fuel produced at transmix processing 

facilities. Some products shipped by 

pipeline such as jet fuel and heating oil 

are subject to relatively high sulfur 

specifications (e.g., maximum 3,000 

ppm for jet fuel). The presence of such 

high sulfur products in multi product 

pipelines and consequently in transmix 

constrains the ability of transmix 

processors to produce a low sulfur 

distillate product. 

The engine emissions standards 

finalized in the nonroad diesel 

rulemaking for new nonroad, 

locomotive, and Category 1 & 2 (C1 & 

C2) marine engines necessitates the use 

of sulfur-sensitive emissions control 

equipment which requires 15-ppm 

sulfur diesel fuel to function properly.10

Accordingly, the nonroad rule required 

that nonroad, locomotive and marine 

(NRLM) diesel fuel must meet a 15-ppm 

sulfur standard in parallel with the 

introduction of new sulfur-sensitive 

emissions control technology to NRLM 

equipment. Beginning June 1, 2014, the 

nonroad diesel rule required that all 

NRLM diesel fuel produced by refiners 

and importers must meet a 15-ppm 

sulfur standard. The nonroad diesel rule 

included special provisions to allow the 

continued use of 500-ppm sulfur 

locomotive and marine (LM) diesel fuel 

produced from transmix beyond 2014 in 

older technology engines as long as such 

engines remained in the in-use fleet. 

These provisions along with other now 

expired flexibilities in the diesel 

program were designed to minimize and 

postpone the impacts on transmix 

processors of transitioning to a 

condition where all highway, nonroad, 

locomotive, and marine diesel engines 

can only operate on 15-ppm diesel 

fuel.11 The 500-ppm LM diesel transmix 


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Federal Register / Vol. 77, No. 195 / Tuesday, October 9, 2012 / Proposed Rules 61321 

distillate product to other markets (C3 marine, 

heating oil, process heat). It may also allow 

sufficient time for the introduction of 

desulfurization equipment that is suitable for use at 

transmix processing facilities. 

12The NEMA area is defined in 40 CFR 

80.510(g)(1) as follows: (1) Northeast/Mid-Atlantic 

Area, which includes the following States and 

counties, through May 31, 2014: North Carolina, 

Virginia, Maryland, Delaware, New Jersey, 

Connecticut, Rhode Island, Massachusetts, 

Vermont, New Hampshire, Maine, Washington DC, 

New York (except for the counties of Chautauqua, 

Cattaraugus, and Allegany), Pennsylvania (except 

for the counties of Erie, Warren, McKean, Potter, 

Cameron, Elk, Jefferson, Clarion, Forest, Venango, 

Mercer, Crawford, Lawrence, Beaver, Washington, 

and Greene), and the eight eastern-most counties of 

West Virginia (Jefferson, Berkeley, Morgan, 

Hampshire, Mineral, Hardy, Grant, and Pendleton). 

13This included the now-completed phase-in of 

15 ppm highway diesel fuel and 15 ppm nonroad 

diesel fuel as well as the phase-out of the small 

refiner and credits provisions for LM diesel fuel 

that will be completed in 2014. 

14Control of Emissions From New Marine 

Compression-Ignition Engines at or Above 30 Liters 

per Cylinder; Proposed Rule, 74 FR 44442 (August 

28, 2009). 

15Control of Emissions From New Marine 

Compression-Ignition Engines at or Above 30 Liters 

per Cylinder; Final Rule, April 30, 2010, 75 FR 

22896. 

16Petition to Reconsider Final Rule: Control of 

Emissions from New Marine Compression Ignition 

Engines at or Above 30 Liters per Cylinder; Final 

Rule, 75 FR 22,896 (April 30, 2010), Letter to EPA 

Administrator Lisa Jackson dated June 29, 2010, 

from Chet Thompson of Crowell and Moring LLP, 

on behalf of Allied Energy Company, Gladieux 

Trading and Marketing, Insight Equity Acquisition 

Partners, LP, Liquid Titan, LLC, and Seaport 

Refining and Environmental, LLC. 

17Petition for Review, Allied Energy Company, 

Gladieux Trading and Marketing, Insight Equity 

Acquisition Partners, LP, LiquidTitan, LLC, and 

Seaport Refining and Environmental LLC, v. 

Respondent; U.S. Environmental Protection Agency, 

United States Court of Appeals for the District of 

Columbia Circuit, Case 10–1146, Document 

1252640, Filed 06/29/2010. 

18Notice of Proposed Settlement Agreement, 

Request for Public Comment, 76 FR 56194 

(September 12, 2011). 

19This is based on our review of data on the 

sulfur levels of transmix distillate product from 

various transmix processors. 

20Based on information provided by transmix 

processors, we estimate that approximately 750 

million gallons per year of transmix is produced 

annually and that 2⁄3 of the transmix-derived 

product is distillate fuel and 1⁄3 is gasoline. 

provisions were limited to areas outside 

of the Northeast Mid-Atlantic Area 

(NEMA) and Alaska because it was 

judged that the heating oil market in 

these areas would provide a sufficient 

outlet for transmix distillate in these 

areas.12 Excluding the NEMA area and 

Alaska also allowed us to exempt the 

NEMA area and Alaska from the fuel 

marker provisions that are a part of the 

compliance assurance regime. The 

continuation of the 500-ppm LM diesel 

transmix provisions beyond 2014 

(finalized in the nonroad rule) was 

supported by ongoing recordkeeping, 

reporting, and fuel marker provisions 

that were established to facilitate 

enforcement during the phase in of the 

diesel sulfur program.13

In the development of the proposed 

requirements for Category 3 (C3) marine 

engines, EPA worked with industry to 

evaluate how the enforcement 

provisions for the new 1,000-ppm C3 

marine diesel fuel to be introduced in 

June of 2014 could be incorporated into 

existing diesel program provisions.14

Our assessment based on input from 

industry at the time indicated that 

incorporating the new C3 marine fuel 

into the diesel program enforcement 

mechanisms while preserving the 500- 

ppm diesel transmix flexibility could 

not be accomplished without retaining 

significant existing burdens and 

introducing new burdens on a broad 

number of regulated parties. We also 

concluded that the new C3 marine 

diesel market would provide a sufficient 

outlet for transmix processors distillate 

product in place of the 500-ppm LM 

diesel market. Thus, we believed the 

500-ppm LM diesel transmix flexibility 

would no longer be needed after 2014. 

Hence, we requested comment on 

whether we should eliminate the 500- 

ppm LM transmix provisions in parallel 

with the implementation of the C3 

marine diesel sulfur requirement. This 

approach allowed for a significant 

reduction in the regulatory burden on a 

large number of industry stakeholders 

through the retirement of the diesel 

program’s designate-and-track and fuel 

marker requirements. All of the 

comments that we received on the 

proposed rule were supportive of the 

approach. Consequently, we finalized 

the approach in the C3 marine final rule 

that was published on April 30, 2010.15

EPA received a petition from a group 

of transmix processors on June 29, 2010, 

requesting that the Agency reconsider 

and reverse the 2014 sunset date for the 

500-ppm LM transmix flexibility.16 A 

parallel petition for regulatory review 

was filed with the U.S. Court of 

Appeals, DC Circuit.17 The transmix 

processors stated that they were not 

aware of the changes to the 500-ppm LM 

transmix provisions until after they 

were finalized. The petitioners also 

stated that they believe that the C3 

marine market would not be a viable 

outlet for their distillate product given 

the increased distribution costs 

compared to the 500-ppm LM market. 

Based on the additional input that we 

received from transmix processors and 

other stakeholders in the fuel 

distribution system during our 

consideration of the petition, EPA 

believes that while the increased costs 

for transportation of transmix distillate 

product could be accommodated, there 

is no compelling reason not to extend 

the 500 ppm diesel transmix flexibility 

beyond 2014 if such costs can be 

avoided or deferred without affecting 

the benefits from the diesel sulfur 

program. A settlement agreement has 

been finalized between EPA and the 

petitioners under which EPA would 

propose regulatory changes to 

reintroduce the 500-ppm LM transmix 

diesel flexibility for legacy LM 

equipment.18 The proposed 

amendments to the diesel transmix 

provisions contained in today’s action 

are in accord with the settlement 

agreement. 

Our analysis indicates that extending 

the 500-ppm LM flexibility beyond 2014 

would have a neutral or net beneficial 

effect on overall emissions. The use of 

500-ppm LM from transmix would be 

limited to older technology engines that 

do not possess sulfur-sensitive emission 

control technology. We believe that the 

proposed 500-ppm LM segregation and 

other associated requirements would 

prevent misfueling of sulfur-sensitive 

engines. 

To evaluate the environmental 

consequences of extending the diesel 

transmix provisions, we compared the 

potential increase in sulfate particulate 

matter (PM) from the use of 500 ppm 

LM from transmix in older engines to 

the additional transportation emissions 

associated with shipment to the 

Category 3 (C3) marine market which 

might be deferred by allowing 

continued access to the 500 ppm LM 

market. Markets for locomotive and 

marine diesel tend to be nearer to 

transmix processing facilities than 

markets for C3 marine diesel. Therefore, 

extending the diesel transmix 

provisions would result in a reduction 

in nitrogen oxides (NOX), volatile 

organic compounds (VOCs), carbon 

monoxide (CO), as well as PM emissions 

that would otherwise be associated with 

transporting transmix distillate product 

to the more distant C3 market. 

Although some batches of transmix 

distillate product may approach the 500 

ppm sulfur limit, we estimate that the 

average sulfur content of transmix 

distillate product would be no more 

than 300 ppm.19 We estimate that 

approximately 500 million gallons of 

distillate fuel per year is produced from 

transmix.20 Assuming that all of the 

transmix distillate product would be 

used as 500 ppm LM in older engines, 

we estimate that an additional 70 tons 

of sulfate PM would be produced 

annually compared to the use of 15 ppm 


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21Sulfate PM was converted to PM2.5 to allow a 

comparison with PM2.5 from increased fuel 

transport emissions. 

22There is no ability to ship transmix distillate 

product to the C3 marine diesel market by pipeline. 

23 In the 2011 edition of ‘‘Railroad Facts,’’ the 

Association of American Railroads reported that in 

2010 approximately 35% of the locomotive fleet 

was at least 21 years old. 

24See 40 CFR 80.554(a)(4). 

25An entity is defined as any company that takes 

custody of 500-ppm LM diesel fuel. 

26 In most cases, fewer entities would take 

custody of the product. In many cases, only a single 

entity (a tank truck operator) would be in the 

distribution chain between the transmix processor 

and the ultimate consumer. However, we 

understand that as many as 4 separate entities may 

handle the product between the producer and 

ultimate consumer if it is shipped by pipeline: the 

tank truck operator to ship the product from the 

producer to the pipeline, the pipeline operator, the 

product terminal that receives the fuel from the 

pipeline, and another tank truck operator to ship 

the product to the ultimate consumer from the 

terminal. 

27 500 ppm LM diesel fuel is shipped by a short 

dedicated pipeline from a product terminal to a 

locomotive refueling facility. 

diesel fuel.21 We believe that a 

substantial fraction of transmix distillate 

product would be used as heating oil 

and C3 diesel fuel regardless of whether 

the diesel transmix provisions are 

extended. Also, as the older LM engines 

are retired from service, the size of the 

potential 500 ppm LM market will 

diminish until all LM engines must use 

15 ppm diesel fuel. Therefore, assuming 

that all transmix distillate product 

would be used as 500 ppm LM provides 

an upper bound estimate of the 

potential impact on PM emissions. 

We estimate on average that transmix 

processors would need to ship their 

transmix distillate product an additional 

150 miles by tank truck to reach the C3 

Emission Control Area (ECA) marine 

market as compared to the 500 ppm LM 

market.22 This would result in an 

additional 80 tons of PM emissions 

annually. Thus, the PM emissions 

associated with transport to the C3 

marine market are roughly equal to the 

increased sulfate PM emissions 

associated with the continued use of 

500 ppm LM. We estimate that the 

increased transport distances could also 

result in an additional 2,200 tons of 

NOX, 220 tons of VOC, and 650 tons of 

CO annually. Based on the above 

discussion, we believe that the proposed 

extension of the 500 ppm LM provisions 

beyond 2014 outside the NEMA area 

and Alaska would have a neutral or 

positive environmental impact. 

The extension of the 500-ppm LM 

transmix flexibility would defer 

additional transportation costs and 

provide a lower-cost fuel for use in 

older LM engines for many years to 

come given that the useful life of LM 

engines can exceed 40 years.23

Therefore, extending this flexibility 

would reduce the overall burden on 

industry of compliance with EPA’s 

diesel sulfur program. Providing 

additional time for transmix processors 

to evaluate how the C3 ECA marine 

market will develop after 2014 would 

also facilitate a smoother transition for 

transmix processors from the 500-ppm 

LM market as it gradually disappears 

due to fleet turnover. 

B. Proposed Diesel Transmix Provisions 

Industry stakeholders suggested 

alternative enforcement mechanisms to 

support the extended flexibility which 

would not necessitate reinstating and 

expanding the designate-and-track and 

fuel marker provisions that were retired 

by the C3 marine final rule. 

Reinstatement and expansion of these 

provisions would likely place an 

unacceptable burden on a large number 

of stakeholders, most of whom would 

not handle 500-ppm LM. The suggested 

alternative enforcement mechanism 

would impose minimal additional 

reporting and recordkeeping burdens 

only on the parties that produce, 

handle, and use 500-ppm LM. We 

believe that this alternative enforcement 

approach would meet the Agency’s 

goals of ensuring that the pool of 500- 

ppm LM is limited to transmix distillate 

and that 500-ppm LM is not used in 

sulfur-sensitive emissions control 

equipment. 

The compliance assurance provisions 

that we are proposing to support the 

extension of the diesel transmix 

flexibility are similar to those that were 

used to support the small refiner 

flexibilities in Alaska during the phasein of EPA’s diesel sulfur program.24 In 

addition to registering as a refiner and 

certifying that each batch of fuel 

complies with the fuel quality 

requirements for 500-ppm LM diesel 

fuel, producers of 500-ppm transmix 

distillate product would be required to 

submit a compliance plan for approval 

by EPA. This compliance plan would 

provide details on how the 500-ppm LM 

would be segregated through to the 

ultimate consumer and its use limited to 

the legacy LM fleet. The plan would be 

required to identify the entities that 

would handle the fuel and the means of 

segregation. We believe that it is 

appropriate to limit the number of 

entities that would be allowed to handle 

the fuel between the producer and the 

ultimate consumer in order to facilitate 

EPA’s compliance assurance 

activities.25 Based on conversations 

with transmix processors, we believe 

that specifying that no more than 4 

separate entities handle the fuel 

between the producer and the ultimate 

consumer would not hinder the ability 

to distribute the fuel.26 The plan would 

need to identify the ultimate consumers 

and include information on how the 

product would be prevented from being 

used in sulfur-sensitive equipment. 

We understand that some transmix 

processors currently rely on shipment 

by pipeline to reach the 500-ppm 

locomotive diesel market.27 We are 

proposing that 500-ppm LM could be 

shipped by pipeline provided that it 

does not come into contact with 

distillate products that have a sulfur 

content greater than 15 ppm. The 

compliance plan would need to include 

information from the pipeline operator 

regarding how this segregation would be 

maintained. Discussions with transmix 

processors indicate that this 

requirement would not limit their 

ability to ship 500-ppm LM by pipeline. 

If 500-ppm LM was shipped by pipeline 

abutting 15-ppm diesel, the volume of 

500-ppm LM delivered would likely be 

slightly greater than that which was 

introduced into the pipeline as a 

consequence of cutting the pipeline 

interface between the two fuel batches 

into the 500-ppm LM batch. This small 

increase in 500-ppm LM volume would 

be acceptable. 

To provide an additional safeguard to 

ensure that volume of 500 ppm LM 

diesel fuel does not swell 

inappropriately, the volume increase 

during any single pipeline shipment 

must be limited to 2 volume percent or 

less. This limitation on volume swell to 

2 volume percent or less is consistent 

with the limitation in 40 CFR 

80.599(b)(5) regarding the allowed swell 

in volume during the shipment of 

highway diesel fuel for the purposes of 

the determination of compliance with 

the now expired volume balance 

requirements under 40 CFR 

80.598(b)(9)(vii)(B). Industry did not 

object to this requirement, and 

therefore, we believe that limiting the 

volume swell of 500 ppm LM diesel fuel 

during shipment by pipeline to 2 

volume percent or less should provide 

sufficient flexibility. 

Product transfer documents (PTDs) for 

500-ppm LM diesel would be required 

to indicate that the fuel must be 

distributed in compliance with the 

approved compliance assurance plan. 

Entities in the distribution chain for 

500-ppm LM diesel fuel would be 

required to keep records on the volumes 

of the 500-ppm that they receive from 

and deliver to each other entity. Based 

on input from fuel distributors, keeping 


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28LM diesel fuel in terminals located in the 

NEMA area is subject to a 15-ppm sulfur standard 

beginning August 1, 2012. LM diesel fuel at retailers 

and wholesale purchaser consumers must meet a 

15-ppm sulfur standard beginning October 1, 2012. 

29Prior to 2014, parties outside of the NEMA area 

who distribute 500-ppm LM would be covered by 

the existing compliance assurance requirements. 

30 ‘‘Control of Emissions for Air Pollution From 

Nonroad Diesel Engines and Fuel; Final Rule,’’ 

Section V.C.1.c., The Period From June 1, 2012 

Through May 31, 2014, 69 FR 39083, 39084 (June 

29, 2004). 

these records will be a minimal 

additional burden, as discussed in 

section X.B. Such entities would also be 

required to keep records on how the fuel 

was transported and segregated. We 

would typically expect that the volumes 

of 500-ppm LM delivered would be 

equal to or less than those received 

unless shipment by pipeline occurred. 

Some minimal increase in 500-ppm LM 

volume would be acceptable due to 

differences in temperature between 

when the shipped and received volumes 

were measured and interface cuts 

during shipment by pipeline. Entities 

that handle 500-ppm LM would be 

required to calculate a balance of 500- 

ppm LM received versus delivered/used 

on an annual basis. If the volume of fuel 

delivered/dispensed is greater than that 

received, EPA would expect that the 

records would indicate the cause. EPA 

requests comment on whether it is 

appropriate to set an upper limit on the 

potential volume increase due to 

pipeline shipment and temperature 

swell, and if 2 percent would be an 

appropriate upper limit. If an entity’s 

evaluation of their receipts and 

deliveries of 500-ppm LM fuel indicated 

noncompliance with the product 

segregation requirements, the custodian 

would be required to notify EPA. All 

entities in the 500-ppm LM distribution 

chain would be required to maintain the 

specified records for 5 years and 

provide them to EPA upon request. 

C. Consideration of Extending the Diesel 

Transmix Provisions To Include the 

Northeast Mid-Atlantic Area 

The nonroad diesel rule specified that 

the small diesel refiner, credit, and 

transmix provisions would not apply in 

the Northeast Mid-Atlantic (NEMA) 

area. Hence, all LM diesel fuel shipped 

from refineries, transmix processors, 

and importers for use in the NEMA Area 

must meet a 15-ppm sulfur standard 

beginning June 1, 2012 when the 15- 

ppm standard becomes effective for 

large refiners and importers.28 This 

approach allowed the NEMA area to be 

exempted from fuel marker provisions 

that are a component of the compliance 

assurance provisions associated with 

the small diesel refiner, credit, and 

transmix provisions. As discussed 

previously a significant factor in the 

decision made in the nonroad diesel 

rule to exclude the NEMA from the 

diesel transmix provisions was our 

assessment that the heating oil market 

would provide a sufficient outlet for 

transmix distillate product in this area. 

Since the publication of the nonroad 

diesel rule in 2004, a number of states 

in the NEMA area have moved towards 

implementing a 15-ppm sulfur standard 

for heating oil. A significant fraction of 

heating oil in the area will be subject to 

a 15-ppm sulfur standard beginning in 

2012, and it is likely that other states 

will adopt a 15-ppm sulfur standard for 

heating oil in the following years. 

Transmix processors and other fuel 

distributors in the NEMA area stated 

that they were concerned that the 

changing state heating oil specifications 

would impact their ability to market 

transmix distillate product beginning in 

2012 and increasingly over time. They 

requested that EPA extend the 500-ppm 

LM flexibility to the NEMA area by 2012 

to lessen the impact on the fuel 

distribution system of complying with 

more stringent federal and state 

distillate sulfur standards. They stated 

that the enforcement mechanisms 

proposed above for use outside of the 

NEMA area after 2014 could apply 

equally well within the NEMA area 

beginning in 2012. They also stated that 

extending the proposed flexibility to 

inside the NEMA would not have an 

adverse environmental impact because 

of the potential to defer significant 

additional transportation emissions to 

the more distant C3 marine market. 

The proposed provisions that would 

allow 500-ppm LM from transmix to be 

used outside of the NEMA area after 

2014 would reinstate a flexibility that 

was withdrawn by the C3 marine final 

rule. Allowing 500-ppm LM to be used 

inside the NEMA area would provide 

more flexibility than was previously 

included in EPA’s diesel program. We 

believe that extending the 500-ppm 

transmix flexibility to include the 

NEMA area will reduce distribution 

costs for their distillate product from 

transmix processors. Consequently, we 

are requesting comment on applying the 

proposed 500-ppm LM transmix 

provisions discussed above to the 

NEMA area beginning June 2012.29

Given the current transition in the 

NEMA area to the use of 15-ppm sulfur 

heating oil, it would be most useful to 

industry if the proposed flexibility 

could become effective as soon as 

possible. 

Similar to our analysis for outside of 

the NEMA area, our analysis of the 

potential environmental consequences 

of extending the diesel transmix 

flexibility to include the NEMA area 

indicates the effect on emissions would 

be neutral or positive. We also agree that 

the compliance assurance requirements 

that we are proposing for outside of the 

NEMA area could be applied within the 

NEMA area. A substantial fraction of the 

transmix processing industry markets 

fuel within the NEMA area. Thus, the 

potential cost reduction to industry and 

additional time to prepare for a 

transition to other markets for transmix 

distillate product that would be afforded 

by an extension of the proposed 

provisions to the NEMA would be 

significant. 

The implementation of the 1,000-ppm 

sulfur C3 marine fuel requirements in 

2014 would provide another outlet for 

transmix distillate product in the NEMA 

area to replace the disappearing above15-ppm sulfur heating oil market. We 

request comment on whether, if we 

were to extend the 500-ppm LM 

transmix flexibility to inside the NEMA 

area, such an extension should be 

limited to the time period until the C3 

marine fuel requirements becomes 

effective. 

VII. Amendments Related to the 

Marker Requirements for Locomotive 

and Marine Fuel 

We also propose to amend the 

regulatory provisions regarding the 

transition in the fuel marker 

requirements for 500-ppm LM diesel 

fuel in 2012 to address an oversight in 

the original rulemaking where the 

regulations failed to incorporate 

provisions described in the rulemaking 

preamble. Today’s proposed rule would 

amend the regulatory provisions 

regarding the transition in the fuel 

marker requirements for heating oil in 

2014 to provide improved clarity. 

The preamble in the nonroad diesel 

final rule stated that EPA intended to 

allow 500-ppm LM diesel fuel 

containing greater than 0.10 milligrams 

per liter of solvent yellow 124 (SY124) 

to be present at any location in the fuel 

distribution system (up to and including 

retail and wholesale-purchaserconsumer storage tanks) until 

September 30, 2012.30 Although it was 

not explicitly stated in the preamble, it 

was implied that additional time would 

be allowed for marked 500-ppm LM to 

transition from the fuel tanks connected 

to locomotive and marine engines, 

consistent with the approach taken 

regarding the implementation of more 

stringent diesel fuel sulfur standards. 

However, the nonroad diesel regulations 

are not consistent with the preamble 


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31We project that the number of effected parties 

will remain essentially constant over time. 

32This includes the time to train staff, formulate 

and transmit responses, and other miscellaneous 

compliance related activities. 

33This is based on current transmix production. 

Although the total volume of transmix produced in 

the fuel distribution system may decline in parallel 

with the projected decrease in overall petroleumbased fuel use, we anticipate that the number of 

transmix processors will remain essentially 

constant since their number is dependent on the 

configuration of the petroleum-based fuel 

distribution system. 

and do not provide the allowance for 

marked 500-ppm LM diesel fuel to 

transition from fuel distribution and 

end-user tanks. 40 CFR 80.510(e) 

requires that all 500-ppm LM diesel fuel 

delivered from a truck loading rack 

located outside of the Northeast MidAtlantic (NEMA) area and Alaska must 

contain at least 6 mg/liter of SY124 

through May 31, 2012. However, the 

regulatory text at 40 CFR 80.510(f) 

requires that beginning June 1, 2012, 

any diesel fuel that contains 0.10 mg/ 

liter of SY124 must be designated as 

heating oil. Thus, the regulations as 

currently written do not provide any 

transition time for marked LM fuel that 

is present the distribution system as of 

May 31, 2012 to work its way through 

the fuel distribution system downstream 

of the truck loading rack and through 

the tanks connected to locomotive and 

marine engines. 

A number of locomotive and marine 

wholesale purchaser-consumers have 

taken custody of marked 500-ppm LM 

diesel fuel that they will not be able to 

consume prior to June 1, 2012. A 

number of fuel suppliers also have 

inventories of 500-ppm LM diesel fuel 

on hand that they may not be able to sell 

to LM diesel fuel users because such 

users are concerned about clearing their 

tanks of marked LM diesel fuel by June 

1, 2012. We are proposing to allow 

marked 500-ppm LM diesel fuel to 

transition normally through the fuel 

distribution and use system, consistent 

with the original intent of the nonroad 

diesel rule preamble. Today’s proposed 

rule would allow 500-ppm LM diesel 

fuel at any point in the fuel distribution 

and end use system to contain more 

than 0.10 milligrams per liter of SY 124 

through November 30, 2012. 

We are proposing to implement a 

single transition date applicable at all 

points in the fuel distribution and use 

system rather than a separate date 

applicable through retail and wholesalepurchaser-consumer (WPC) facilities 

and another date applicable at all 

locations including the tanks attached to 

locomotive and marine equipment 

because we believe that a stepped 

compliance schedule is not necessary 

and a single transition date provides the 

most flexibility for regulated parties. We 

expect that the marker will typically 

transition out of retailer and WPC LM 

diesel storage tanks well in advance of 

November 30, 2012. We further expect 

that users of LM diesel fuel can 

coordinate with retail and WPC 

facilities regarding deliveries of marked 

500-ppm LM diesel fuel to ensure that 

the fuel in storage tanks attached to LM 

equipment is in compliance by 

November 30, 2012. 

Today’s proposed rule would also 

amend the regulation to clarify the 

transition of the solvent yellow 124 

marker out of heating oil beginning June 

1, 2014. Specifically, today’s proposal 

would amend the regulations to clarify 

that after December 1, 2014, EPA will no 

longer have any requirements with 

respect to the use of the solvent yellow 

124 marker. This is consistent with the 

intent expressed in our original nonroad 

diesel fuel rulemaking. We do not 

believe these proposed changes will 

adversely impact emissions. 

VIII. Statutory and Executive Order 

Reviews 

A. Executive Order 12866: Regulatory 

Planning and Review and Executive 

Order 13563: Improving Regulation and 

Regulatory Review 

Under Executive Order 12866 (58 CFR 

51735 (October 4, 1993), this action is 

a ‘‘significant regulatory action.’’ 

Accordingly, EPA submitted this action 

to the Office of Management and Budget 

(OMB) for review under Executive 

Orders 12866 and 13563 (76 FR 3821 

(January 21, 2011) and any changes 

made in response to OMB 

recommendations have been 

documented in the docket for this 

action. 

B. Paperwork Reduction Act 

The information collection 

requirements in this notice of proposed 

rulemaking and direct final rule have 

been submitted for approval to the 

Office of Management and Budget 

(OMB) under the Paperwork Reduction 

Act, 44 U.S.C. 3501 et seq. The 

Information Collection Request (ICR) 

document prepared by EPA related to 

the amended heating oil definition has 

been assigned EPA ICR number 2462.01 

and the ICR document prepared by EPA 

for diesel fuel produced by transmix 

producers has been assigned EPA ICR 

number 2463.01. Supporting statements 

for these proposed ICRs have been 

placed in the docket. The proposed 

information collections are described in 

the following paragraphs. 

This action contains recordkeeping 

and reporting (registration and product 

transfer documentation) that may affect 

parties who produce or import 

renewable fuels subject to the proposed 

revised definition of heating oil. EPA 

expects that very few parties will be 

subject to additional recordkeeping and 

reporting. We estimate that up to 11 

parties (i.e., RIN generators, consisting 

of up to 10 producers and one importer) 

may be subject to the proposed 

information collection over the next 

several years.31 We estimate an annual 

reporting burden of 21 hours per 

respondent and an annual 

recordkeeping burden of 24 hours, 

yielding a total per respondent burden 

of 45 hours.32 Burden means the total 

time, effort, or financial resources 

expended by persons to generate, 

maintain, retain, or disclose or provide 

information to or for a Federal agency. 

This includes the time needed to review 

the instructions; develop, acquire, 

install, and utilize technology and 

systems for the purpose of collecting, 

validating, and verifying information, 

processing and maintaining 

information, and disclosing and 

providing information; adjust the 

existing ways to comply with any 

previously applicable instructions and 

requirements; train personnel to be able 

to respond to a collection of 

information; search data sources; 

complete and review the collection of 

information; and transit or otherwise 

disclose the information. Burden is as 

defined at 5 CFR 1320.3(b). 

This action also contains provisions 

related to diesel fuel that is produced by 

transmix processors. We have proposed 

reporting requirements that would 

apply to transmix processors (all of 

whom are refiners) and other parties 

(such as carriers or distributors) in the 

distribution chain who handle diesel 

fuel produced by transmix producers. 

The collected data will permit EPA to: 

(1) Process compliance plans from 

transmix producers; and (2) Ensure that 

diesel fuel made from transmix meets 

the standards required under the 

regulations at 40 CFR part 80, and that 

the associated benefits to human health 

and the environment are realized. We 

estimate that 25 transmix processors 

and 150 other parties may be subject to 

the proposed information collection.33

We estimate an annual reporting burden 

of 28 hours per transmix processor 

(respondent) and 8 hours per other party 

(respondent); considering all 

respondents (transmix producers and 

other parties) who would be subject to 

the proposed information collection, the 

annual reporting burden, per 

respondent, would be 11 hours. Burden 


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means the total time, effort, or financial 

resources expended by persons to 

generate, maintain, retain, or disclose or 

provide information to or for a Federal 

agency. This includes the time needed 

to review the instructions; develop, 

acquire, install, and utilize technology 

and systems for the purpose of 

collecting, validating, and verifying 

information, processing and 

maintaining information, and disclosing 

and providing information; adjust the 

existing ways to comply with any 

previously applicable instructions and 

requirements; train personnel to be able 

to respond to a collection of 

information; search data sources; 

complete and review the collection of 

information; and transit or otherwise 

disclose the information. Burden is as 

defined at 5 CFR 1320.3(b). 

The proposed amendments to the fuel 

marker requirements for locomotive and 

marine diesel fuel in today’s proposed 

rule do not contain any new 

recordkeeping and reporting 

requirements. 

An agency may not conduct or 

sponsor, and a person is not required to 

respond to, a collection of information 

unless it displays a currently valid OMB 

control number. The OMB control 

numbers for EPA’s regulations are listed 

in 40 CFR part 9. 

To comment on the Agency’s need for 

this information, the accuracy of the 

provided burden estimates, and any 

suggested methods for minimizing 

respondent burden, EPA has established 

a public docket for this rule, which 

includes the ICRs described above, 

under Docket ID number EPA–HQ– 

OAR–2012–0223. Submit any comments 

related to the ICR to EPA and OMB. See 

the ADDRESSES section at the beginning 

of this notice for where to submit 

comments to EPA. Send comments to 

OMB at the Office of Information and 

Regulatory Affairs, Office of 

Management and Budget, 725 17th 

Street NW., Washington, DC 20503, 

Attention: Desk Office for EPA. Since 

OMB is required to make a decision 

concerning the ICR between 30 and 60 

days after October 9, 2012, a comment 

to OMB is best assured of having its full 

effect if OMB receives it by November 

8, 2012. 

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. The proposed 

amendments to the diesel transmix 

provisions would lessen the regulatory 

burden on all affected tranmix 

processors and provide a source of 

lower cost locomotive and marine diesel 

fuel to consumers. 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 and diesel 

sulfur 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 and diesel 

sulfur 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 and diesel sulfur 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 action is not a ‘‘significant 

energy action’’ as defined in Executive 

Order 13211 (66 FR 28355 (May 22, 

2001)), because it is not likely to have 

a significant adverse effect on the 

supply, distribution, or use of energy. 

We have concluded that this rule is not 

likely to have adverse energy effects 

because we do not anticipate adverse 

energy effects related to the additional 


wreier-aviles on DSK5TPTVN1PROD with PROPOSALS
61326 Federal Register / Vol. 77, No. 195 / Tuesday, October 9, 2012 / Proposed Rules 

34See section VI and VII of today’s notice for 

details of this analysis. 

generation of RINs for home heating oil 

or the reduced regulatory burden for 

transmix processors. This proposed rule 

would facilitate the use of 500-ppm 

sulfur locomotive and marine (LM) 

diesel fuel, which contains the SY 124 

marker that is already in the fuel 

distribution and use system consistent 

with EPA’s original intent. Today’s 

action will avoid the potential need to 

remove marked 500-ppm LM diesel fuel 

from the system for reprocessing, and 

the associated increased costs and 

potential disruption to the supply of LM 

diesel fuel. 

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. 

J. Executive Order 12898: Federal 

Actions To Address Environmental 

Justice in Minority Populations and 

Low-Income Populations 

Executive Order (EO) 12898 (59 FR 

7629 (February 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. 

We have determined that proposed 

amendments to the diesel transmix 

provisions and marker provisions for 

locomotive and marine diesel fuel under 

the diesel sulfur program would have a 

neutral or positive impact on diesel 

vehicle emissions.34

IX. 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, Transmix, Energy, Forest 

and forest products, Fuel additives, 

Gasoline, Imports, Labeling, Motor 

vehicle pollution, Penalties, Petroleum, 

Reporting and recordkeeping 

requirements. 

Dated: September 17, 2012. 

Lisa P. Jackson, 

Administrator. 

[FR Doc. 2012–23714 Filed 10–5–12; 8:45 am] 

BILLING CODE P 

ENVIRONMENTAL PROTECTION 

AGENCY 

40 CFR Part 271 

[EPA–R05–RCRA–2012–0377; FRL–9739–6] 

Indiana: Final Authorization of State 

Hazardous Waste Management 

Program Revision 

AGENCY: Environmental Protection 

Agency (EPA). 

ACTION: Proposed rule. 

SUMMARY: Indiana has applied to EPA 

for Final Authorization of the changes to 

its hazardous waste program under the 

Resource Conservation and Recovery 

Act (RCRA). EPA has reviewed 

Indiana’s application with regards to 

federal requirements, and is proposing 

to authorize the state’s changes. 

DATES: Comments must be received on 

or before November 8, 2012. 

ADDRESSES: Submit your comments, 

identified by Docket ID No. EPA–R05– 

RCRA–2012–0377 by one of the 

following methods: 

http://www.regulations.gov: Follow 

the on-line instructions for submitting 

comments. 

Email: westefer.gary@epa.gov. 

Mail: Gary Westefer, Indiana 

Regulatory Specialist, LR–8J, U.S. EPA, 

Region 5, 77 West Jackson Boulevard, 

Chicago, Illinois 60604. 

Instructions: Direct your comments to 

Docket ID Number EPA–R05–RCRA– 

2012–0377. EPA’s policy is that all 

comments received will be included in 

the public docket without change and 

may be made available online at http:// 

www.regulations.gov, including any 

personal information provided, unless 

the comment includes information 

claimed to be Confidential Business 

Information (CBI) or other information 

whose disclosure is restricted by statute. 

Do not submit information that you 

consider to be CBI or otherwise 

protected through www.regulations.gov 

or email. The www.regulations.gov Web 

site is an ‘‘anonymous access’’ system, 

which means EPA will not know your 

identity or contact information unless 

you provide it in the body of your 

comment. If you send an email 

comment directly to EPA without going 

through www.regulations.gov, your 

email address will be automatically 

captured and included as part of the 

comment that is placed in the public 

docket and made available on the 

Internet. If you submit an electronic 

comment, EPA recommends that you 

include your name and other contact 

information in the body of your 

comment and with any disk or CD–ROM 

you submit. If EPA cannot read your 

comment due to technical difficulties 

and cannot contact you for clarification, 

EPA may not be able to consider your 

comment. Electronic files should avoid 

the use of special characters or any form 

of encryption, and be free of any defects 

or viruses. For additional information 

about EPA’s public docket, visit the EPA 

Docket Center homepage at http:// 

www.epagov/epahome/dockets.htm. 

Docket: All documents in the docket 

are listed in the www.regulations.gov 

index. Although listed in the index, 

some of the information is not publicly 

available; e.g., CBI or other information 

for which disclosure is restricted by 

statute. Certain other material, such as 

copyrighted material, will be publicly 

available only in hard copy. Publicly 

available docket materials are available 

either electronically in http:// 


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