```

[Federal Register Volume 78, Number 204 (Tuesday, October 22, 2013)]
[Rules and Regulations]
[Pages 62462-62471]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-24280]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 80

[EPA-HQ-OAR-2012-0223; FRL-9900-89-OAR]
RIN 2060-AR87

Regulation of Fuels and Fuel Additives: Modifications to 
Renewable Fuel Standard Program

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: In this final rule EPA is amending the definition of ``heating 
oil'' in the regulations for the Renewable Fuel Standard (RFS) program 
under section 211(o) of the Clean Air Act. This amendment expands the 
scope of renewable fuels that can be used to show compliance with the 
RFS renewable fuel volume obligations by adding an additional category 
of compliant renewable fuel referred to as ``fuel oils,'' produced from 
qualifying renewable biomass and used to generate heat to warm 
buildings or other facilities where people live, work, recreate, or 
conduct other activities. Producers or importers of fuel oil that meets 
the amended definition of heating oil will be allowed to generate 
Renewable Identification Numbers (RINs), provided that the fuel oil 
meets all other requirements specified in the RFS regulations. Fuel 
oils used to generate process heat, power, or other functions are not 
included in this additional category of heating oil. All fuels 
previously included in the definition of heating oil continue to be 
included as heating oil for purposes of the RFS program.
    We are also finalizing specific registration, reporting, product 
transfer document, and recordkeeping requirements applicable 
specifically to these fuel oils, necessary to demonstrate that the fuel 
oil volume for which RINs were generated was or will be used to heat 
buildings for climate control for human comfort prior to generating 
RINs.
    The final rule is being adopted with only minor changes from the 
rule proposed on October 9, 2012, and responses to public comments are 
provided.

DATES: This rule is effective on December 23, 2013.

ADDRESSES: EPA established a docket for this action under the Docket ID 
No. EPA-HQ-OAR-2012-0223. All documents in the docket are listed in the 
www.regulations.gov index. Although listed in the index, some 
information may not be 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 at www.regulations.gov or in hard copy at the Air and 
Radiation Docket and Information Center, EPA/DC, EPA West, Room 3334, 
1301 Constitution Ave. NW., Washington, DC 20460. 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. You may be charged a reasonable fee for photocopying 
docket materials, as provided for in 40 CFR part 2.

FOR FURTHER INFORMATION CONTACT: Suzanne Bessette, Office of 
Transportation and Air Quality, U.S. Environmental Protection Agency, 
2000 Traverwood Dr., Ann Arbor, MI 48105; telephone number: (734) 214-
4703; fax number: (734) 214-4869; email address: 
bessette.suzanne@epa.gov.

[[Page 62463]]

SUPPLEMENTARY INFORMATION:

I. Executive Summary

A. Purpose

    This final rule expands the regulatory definition of ``heating 
oil'' for purposes of the RFS program. This expansion of the types of 
fuel that can be considered heating oil under the RFS program furthers 
the goals of the Energy Independence and Security Act of 2007 (EISA) to 
reduce the use of fossil fuels and encourage increased production of 
renewable fuels. The EPA expects this rule to allow for the generation 
of additional advanced and cellulosic RINs, which will help enable 
obligated parties under the RFS to meet their renewable fuel 
obligations and offer their customers more alternative fuel products.

B. Summary of Today's Rule

    This rule amends the definition of ``heating oil'' in 40 CFR 
80.1401 in the RFS program promulgated under section 211(o) of the 
Clean Air Act (CAA). This amendment expands the scope of renewable 
fuels that can generate RINs as heating oil by adding an additional 
category of fuel oils that will 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 are not included in this additional category 
of heating oil. This rule will 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. 
These include new registration, reporting, product transfer document, 
and recordkeeping requirements applicable specifically to these fuel 
oils, necessary to demonstrate that the fuel oil volume was or will be 
used to heat buildings for climate control for human comfort prior to 
generating RINs.
    The amendment expands the fuels included in the definition of 
heating oil for purposes of the RFS program. All fuels previously 
included in the definition of heating oil continue to be included as 
heating oil under 40 CFR 80.1401 for purposes of the RFS program.

C. Costs and Benefits

    This amendment provides new opportunities for RIN generation under 
the RFS program. Therefore, EPA believes that this amendment will 
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 this amendment will 
adversely impact emissions.

II. 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:

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                                               NAICS codes                    Examples of potentially regulated
                  Category                         \a\        SIC codes \b\                parties
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Industry...................................          324110            2911  Petroleum refiners, importers.
Industry...................................          325193            2869  Ethyl alcohol manufacturers.
Industry...................................          325199            2869  Other basic organic chemical
                                                                              manufacturers.
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).
\b\ Standard Industrial Classification (SIC) system code.

This table is not intended to be exhaustive, but rather provides a 
guide for readers regarding entities likely to be regulated by this 
action. This table lists the types of entities that EPA is now aware 
could be potentially regulated by this action. Other types of entities 
not listed in the table could also be regulated. To determine whether 
your entity is regulated by this action, you should carefully examine 
the applicability criteria of Part 80, subpart M of title 40 of the 
Code of Federal Regulations. If you have any questions regarding 
applicability of this action to a particular entity, consult the person 
in the preceding FOR FURTHER INFORMATION CONTACT section above.

III. Amendments to the Renewable Fuel Standard Program

A. Amended Definition of Heating Oil

    EPA is issuing this final rule to amend the definition of heating 
oil in 40 CFR 80.1401 in the RFS program promulgated under section 
211(o) of the CAA.\1\ This amendment will expand the scope of renewable 
fuels that can generate RINs as 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 will 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, including new 
registration, reporting, product transfer document, and recordkeeping 
requirements being finalized in this action that are applicable 
specifically to these fuel oils. 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 EISA, 
for the RFS program. All fuels previously included in the definition of 
heating oil continue to be included as heating oil under 40 CFR 80.1401 
for purposes of the RFS program.
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    \1\ The Energy Independence and Security Act of 2007 (EISA) 
amended section 211(o) of the Clean Air Act, which was originally 
added by the Energy Policy Act of 2005 (EPAct).
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    The RFS 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, producers or importers of 
qualified renewable fuel generate RINs which represent the volume of 
renewable fuel that has been produced or imported. 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 for regulated

[[Page 62464]]

parties who exceed their annual volume obligation.
    Congress provided that EPA could 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 produced from 
renewable biomass 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 instead of transportation fuel. This does not change 
the volume requirements of the statute itself, but it can provide an 
important additional avenue for parties to generate RINs for use by 
obligated parties, thus promoting the overall cost-effective production 
and use of renewable fuels.
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    \2\ 75 FR 14670, 14686 (March 26, 2010).
    \3\ See CAA sections 211(o)(1)(A) and (o)(5)(E).
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    EPA addressed the provision for additional renewable fuels in the 
final rule published on March 26, 2010 (74 FR 14670), 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 Sec.  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\
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    \4\ 75 FR 14670, 14687 (March 26, 2010).

The existing definition of heating oil at 40 CFR 80.2(ccc) is ``any 
1, 2, or non-petroleum diesel blend that is sold for 
use in furnaces, boilers, 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 MVNRLM 
[Motor Vehicle, Non-Road, Locomotive and Marine] diesel fuel.'' \5\ The 
existing definition of non-petroleum diesel at 40 CFR 80.2(sss) is ``a 
diesel fuel that contains at least 80 percent mono-alkyl esters of long 
chain fatty acids derived from vegetable oils or animal fats.'' Thus, 
under the existing definitions, RINs may be generated for heating oil 
that is either a 1 or 2 fuel oil or a non-petroleum 
diesel blend containing 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 RFS regulations for renewable 
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fuels.

    \5\ The reference to ``stationary diesel engines'' was removed 
from the definition of 40 CFR 80.2(ccc) as part of EPA's final rule 
concerning oceangoing vessels. 75 FR 22896 (April 30, 2010). 
Deleting this example from the definition avoids confusion that 
otherwise might arise, given the requirements under 40 CFR 60.4207 
for use of ultra low sulfur diesel fuel in certain stationary diesel 
engines. See 40 CFR 60.4207, applicable beginning with model year 
2007.
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    The existing regulations do not allow a party to generate RINs for 
a non-petroleum fuel that is used as a heating oil unless the fuel 
contains at least 80 percent mono-alkyl esters of long chain fatty 
acids derived from vegetable oils or animal fats. Since the 
promulgation of the March 26, 2010 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 are not non-petroleum diesel containing 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 considered this issue further and issued a direct final rule 
and parallel proposed rule to amend the definition of heating oil in 
the RFS program to expand the scope of fuels that can generate RINs as 
heating oil under the RFS program.\6\ EPA received adverse public 
comment and withdrew the direct final rule.\7\
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    \6\ 77 FR 61281 (October 9, 2012); 77 FR 61313 (October 9, 
2012).
    \7\ 77 FR 72746 (December 6, 2012).
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    After considering the public comments, EPA is revising the 
definition of heating oil for purposes of the RFS program to include an 
additional category of fuel oil, as proposed. RINs may be generated for 
an additional category of renewable fuel that is fuel oil used to heat 
interior spaces of homes or buildings to control ambient climate for 
human comfort. This additional category will not include fuel oils used 
to generate process heat, power, or other functions. The fuel oil must 
be used to generate heat to warm buildings or other facilities where 
people live, work, recreate, or conduct other activities. The fuel oil 
must only be used in heating applications, where the sole purpose of 
the fuel is for heating and not for any other combined use such as 
process energy use. This is in addition to the fuel oils previously 
included in the definition of heating oil at 40 CFR 80.1401, which 
refers to section 80.2(ccc). All fuels previously included in the 
definition of heating oil continue to be included as heating oil under 
40 CFR 80.1401 for purposes of the RFS program.
    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 RFS final rule, Congress did not define the 
statutory term ``home heating oil,'' and it does not have a fixed or 
definite commercial meaning. In the March 26, 2010 final rule, 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 one type of fuel, and not to a specific

[[Page 62465]]

use for the fuel. Given this more general usage of the term, EPA 
defined home heating oil by identifying the 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.
    The expansion of the definition adopted in this rulemaking will add 
a category to the definition to include two types of fuel oils not 
included in the original definition of heating oil in section 80.1401. 
First, the new category will include additional fuel oils that do not 
meet the definition of heating oil in section 80.2(ccc) but are 
actually used to heat homes.
    Second, the new category will include fuel oils that are used to 
heat facilities other than homes to control ambient climate for human 
comfort. Under the original definition of heating oil in section 
80.1401, a fuel oil meets the definition of heating oil based on its 
physical properties, not whether it is actually used to heat a home. In 
the new category added in the amended definition, the additional 
qualifying fuel oils will 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.'' 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, both by limiting the additional fuel oils to 
fuel oils used for heating facilities that people will occupy, and 
excluding the additional 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 most important here--the heating 
of people. This interpretation also promotes 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 UOP/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 and other 
parties who commented on the proposed rule, the application of the 
expanded definition of heating oil to the entire industry would result 
in the production of many more million additional gallons of RIN-
generating renewable fuel.

B. Lifecycle Greenhouse Gas Assessment of the Amended Definition of 
Heating Oil

    EPA has also evaluated whether any revisions will need to be made 
to Table 1 to 40 CFR 80.1426. Table 1 lists the applicable D codes for 
each fuel pathway for use in generating RINs in the RFS regulations in 
light of the additional fuel oils included in the expanded definition 
of heating oil. As discussed below, EPA has determined that the 
existing D code entries for heating oil in Table 1 to 40 CFR 80.1426 
will continue to be appropriate and will 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 March 2010 
RFS 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.\8\ 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.
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    \8\ See Table 1 to 40 CFR Sec.  80.1426.
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    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 
conventional 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 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 
original definition of heating oil in section 80.1401, 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 original definition of heating oil, 
which refers to 1, 2, or a non-petroleum diesel 
blend, and the new category added in the expanded definition adopted in 
this rulemaking is that the new category will 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 non-petroleum diesel blend will 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 will require less processing energy and have lower GHG 
emissions than converting the same feedstock into a 1, 
2, or non-petroleum 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

[[Page 62466]]

(CO).\9\ 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 March 26, 2010 RFS rulemaking,\10\ 
this will have no real impact on the energy used or the GHG emissions 
associated with converting the biomass into a different fuel product.
---------------------------------------------------------------------------

    \9\ This 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.
    \10\ ``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.
---------------------------------------------------------------------------

    Based on these considerations, EPA believes the GHG emissions 
associated with producing the additional fuel oils included in the 
expanded definition will be the same or lower than the GHG emissions 
associated with producing a 1, 2, or non-petroleum 
diesel blend. Therefore, the original lifecycle analyses for heating 
oil support applying the existing pathways for heating oil in the RFS 
regulations to the expanded definition of heating oil. Once the 
regulatory change to the definition of heating oil is final, all of the 
pathways currently applicable to heating oil under Table 1 to 40 CFR 
80.1426 will apply to the expanded definition of heating oil.

C. Additional Registration, Reporting, Product Transfer Document, and 
Recordkeeping Requirements

    An important issue to address is how to implement such an expanded 
definition. EPA recognized in the March 26, 2010 rule that it would be 
difficult and expensive to track heating oil to make sure it was 
actually used in homes, and so decided to define home heating oil as a 
type of fuel with certain characteristics, rather than a fuel used in a 
certain way. This approach avoided the need to track heating oil to its 
actual end use, and the definition of heating oil at 40 CFR 80.1401 
simply referred back to the 40 CFR 80.2(ccc) technical definition.
    The expansion of the definition raises this same issue but in a 
more significant way. The original definition does not provide a way to 
assure that RINs are only generated for fuel oils used to heat 
buildings for climate control for human comfort, and not for those used 
to generate process heat or other purposes. Therefore, for the 
additional fuel oils other than those qualifying as heating oil based 
on the definition in 40 CFR 80.2(ccc), EPA is requiring that the 
renewable fuel producer or importer have adequate documentation to 
demonstrate that the fuel oil volume for which RINs were generated was 
or will be used to heat buildings for climate control for human comfort 
as a condition for generating RINs.
    EPA recognizes that for fuels meeting the original definition of 
heating oil in section 80.1401, no tracking or other documentation of 
end use is required, and some heating oils that meet the original 
definition could end up being used for other purposes. However, fuel 
qualifying as heating oil under the original definition has to have the 
physical or other characteristics that make it the type of fuel oil 
normally used to heat homes. The additional fuel oils qualifying as 
heating oil under the new category of the expanded definition will be 
identified as heating oil not by their chemical specifications but 
instead by their actual use for heating for the purposes of climate 
control for human comfort. EPA is not requiring physical specifications 
for the additional fuel oil category, beyond the requirement that it be 
a ``fuel oil'', meaning that it is a liquid at 60 degrees Fahrenheit 
and one atmosphere of pressure and contains no more than 2.5% mass 
solids. Solid or gaseous fuels, for example wood chips or unrefined 
waste fats or gases, would not qualify as heating oil capable of 
generating RINs under the RFS.
    For informational purposes, there are industry standard 
specifications for fuel oils that could qualify as heating oils under 
the expanded definition of heating oil. For example, ASTM D396 covers 
grades of fuel oil intended for use in fuel oil burning equipment, ASTM 
D7666 covers two grades of burner fuel consisting of triglycerides and 
naturally occurring constituents of triglycerides including 
monoglycerides, diglycerides, and free fatty acids and distinguished by 
the pour point, and ASTM D7544 covers grades of pyrolysis liquid 
biofuel produced from biomass intended for use in fuel oil burner 
equipment. These and other fuel oils would also have to meet the 
requirements related to use of the fuel oil for heating, as well as any 
other regulatory requirements applicable under the RFS program.
    In order to verify that the fuel oils are actually used to generate 
heat for climate control purposes, EPA is adopting the following 
registration, recordkeeping, product transfer document (PTD) and 
reporting requirements. These requirements will not apply to fuels 
qualifying under the original part of the 40 CFR 80.1401 definition, 
i.e., they would not apply to fuels that meet the definition of heating 
oil in section 80.2(ccc). These requirements will only apply to the 
additional fuel oils qualifying under the new category of the expanded 
definition in 40 CFR 80.1401. If those fuel oils are designated for but 
not actually used to generate heat for climate control purposes, the 
end user of that fuel oil is subject to and liable for violations of 
the RFS regulations and the CAA, as are as any parties that caused that 
violation. Also, pursuant to the existing regulation in Sec.  
80.1460(c)(2), the end user in this situation would not be allowed to 
retire RINs still associated with the fuel oil for RVO compliance 
purposes or transfer such RINs to any other party. Finally, since the 
additional category of fuel oils is defined as heating oil in terms of 
its use instead of its physical characteristics, EPA must ensure as far 
as is practicable that the RIN-generating renewable fuel is actually 
used for the proper purpose by the end user. We believe it is 
reasonable to require that the RIN-generating renewable fuel producer 
or importer document that the appropriate end use of the fuel is 
certified by an end user. As further discussed below, the RIN generator 
must submit proof of such assurances to EPA in its registration and 
quarterly reports.
    Once the fuel producer has the appropriate affidavit from the end 
user certifying that it has used or intends to use the fuel for the 
proper purpose, the fuel producer may validly generate RINs for the 
fuel. We emphasize that subsequent improper end use would not 
invalidate any RINs generated by the fuel producer for that volume of 
fuel oil. We are not requiring that the RIN-generating producer track 
the fuel's actual end use; only that the fuel be sold for use as a 
heating oil and that the fuel producer receives the appropriate 
affidavit from the end user attesting that the fuel has or will 
actually be used as a heating oil prior to RIN generation. A RIN will 
not be considered valid unless the renewable producer can demonstrate 
by the end user's affidavit that the fuel has or will actually be used 
as heating oil. Parties that purchase RINs generated by renewable fuel 
producers that rely on this new definition will be able to evaluate 
whether the proper use requirement is

[[Page 62467]]

met by examining these affidavits. Therefore, while there is a slight 
chance that the fuel associated with a validly generated RIN may be 
improperly used, once the appropriate certification is made, the RIN 
may be generated and will remain valid regardless of the actual end 
use.
1. Registration
    For the purpose of registration, EPA is allowing the producer of 
the expanded fuel oil types to establish its 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, we are requiring producers of the new category fuel oils 
to submit affidavits in support of their registrations, including a 
statement that the RIN generating 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 require that 
producers submit secondary affidavits from the existing end users to 
verify that the fuel oil is actually being used for or is intended for 
a qualifying purpose. We are also adopting new reporting, product 
transfer documents (PTD), and recordkeeping requirements, discussed 
below, that will help assure that the qualifying fuel oil is being used 
in an approved application. These requirements are necessary to provide 
assurance that the fuel oil used to generate RINs is actually used for 
a qualifying purpose because these types of fuel may not have 
previously been used as heating oil, and may not be readily 
identifiable by their physical characteristics. Without such 
safeguards, EPA could not be confident that the fuel oil is used as 
heating oil, and end users might not have adequate notice that the fuel 
oil must be used as heating oil. EPA believes these requirements will 
place a small but necessary burden on producers and end users, and 
greatly benefit the integrity of the program.
2. Reporting, Product Transfer Documents and Recordkeeping Requirements
    For the purpose of continued verification after registration, EPA 
is adopting additional requirements for reporting in Sec.  
80.1451(b)(1)(ii)(T), PTDs in Sec.  80.1453(d), and recordkeeping in 
Sec.  80.1454(b), for the new category of fuel oils qualifying as 
heating oil.
    The reporting, PTD, and recordkeeping requirements will help ensure 
that the new category of fuel oils used to generate RINs are actually 
used for the appropriate purpose of heating interior spaces for human 
comfort. For reporting, producers are 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 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 must 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.
    The additional product transfer document requirement associated 
with the new category of heating oil is that a PTD must be prepared and 
maintained between the fuel oil producer and the final end user for the 
legal transfer of title and custody of a specific volume of fuel oil 
that is designated for use only for the purpose of heating interior 
spaces of buildings to control ambient climate for human comfort. This 
additional PTD requirement requires that the PTD used to transfer 
ownership and custody of the renewable fuel must contain the statement: 
``This volume of renewable fuel oil 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, as these uses are prohibited 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 used for some non-qualifying purpose 
instead of for generating heat for climate control purposes, then the 
end user of that fuel oil is subject to and liable for violations of 
the RFS regulations and the CAA, as are any parties that caused that 
violation.
    The additional recordkeeping requirement for the new category of 
heating oil is that producers must keep copies of the contracts which 
describe the fuel oil under contract with each end user. If the 
producer is not selling the fuel oil directly to the end user, this may 
require the collection of one or more intermediate contracts showing 
the chain of custody of the fuel oil from the producer to the 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 consistent with the meaning of ``heating oil'' intended 
under EISA.

IV. Summary and Analysis of Comments

    EPA has provided a summary of the comments received and its 
response. EPA has developed a more thorough Response to Comments 
document that addresses each comment specifically and addresses 
requests for clarification to the extent appropriate for this rule.\11\
---------------------------------------------------------------------------

    \11\ Regulation of Fuels and Fuel Additives: Modifications to 
Renewable Fuel Standard Program Response to Comments, available in 
the docket at http://www.regulations.gov.
---------------------------------------------------------------------------

Clarification on Existing Definition of Heating Oil

Comment
    Several commenters sought a variety of clarifications on changes 
being made to the existing definition of heating oil in section 
80.1401.
Response
    As explained in this final rule and the October 9, 2012 proposal, 
this amendment does not modify, limit, or in any way change the 
inclusion of fuels covered by the existing definition of heating oil at 
section 80.1401. All fuels included in the original definition of 
heating oil at section 80.1401 (i.e., those fuels that meet the 
definition of heating oil at section 80.2(ccc)) will continue to be 
included as heating oil for purposes of section 80.1401 and the RFS 
program.

Need for the Expanded Definition of Heating Oil

Comment
    Several commenters expressed support for the expanded definition of 
heating oil. These commenters noted that the current definition is 
overly restrictive and inconsistent with the goals of the RFS program, 
and stated that the expanded definition will spur production of 
cellulosic biofuel from woody, biomass-based resources. Also, these 
commenters believe that the expanded definition will drive tens of 
millions of dollars of local investment and create jobs.

[[Page 62468]]

Response
    As explained in greater detail above, EPA believes this expansion 
of the scope of the definition of heating oil for purposes of the RFS 
program is appropriate and authorized under CAA section 211(o).

Fuel Quality Standards

Comment
    Commenters noted that the expanded definition of heating oil will 
not reference fuel quality standards, which they believed may present 
environmental and safety concerns. Specifically, one commenter (Global 
Renewable Strategies and Consulting (GRSAC)) asserted that the 
definition fails to consider the environment or safety, and should 
reference ASTM standards for fuel oils.
Response
    Section 211(o) of the Clean Air Act, as amended by EISA, requires 
all renewable fuels used in the RFS program to be derived from 
renewable biomass and to meet specified thresholds for reductions in 
lifecycle greenhouse gas emissions compared to a baseline fossil fuel. 
Adding fuel quality specifications for the fuel oils added to the 
definition of ``heating oil'' in this rule would not affect whether the 
fuel oil was derived from renewable biomass, and would not affect the 
analysis of lifecycle greenhouse gas emissions associated with the 
heating oils. Thus the additional specifications suggested by the 
commenters are not relevant to the issues needed to determine whether 
the fuel oils would qualify as renewable fuel for purposes of the RFS 
program.
    The purpose this regulation is to further define what types and 
uses of renewable fuel qualify for RIN generation, not to set safety 
standards or limitations for renewable heating oil. Such standards and 
limitations may be imposed by other regulations and regulatory 
entities, and through private sales agreements, by manufacturers of 
heating equipment, and so on. For example, we expect that many of these 
fuel oils will meet ASTM specifications for fuel oils (e.g., ASTM D396, 
ASTM D7666, and ASTM D7544). The ASTM fuel oil specifications not only 
provide fuel quality specifications, they also indicate appropriate 
uses for the fuel oils meeting the specification. Because the specific 
use of a particular fuel oil is often dependent upon the fuel oil 
conforming to the ASTM specification for that fuel oil, industry 
specification and use would provide a de facto application of fuel oil 
specifications for fuel oil used as heating oil. This de facto control 
would occur naturally within the course of business; an added 
regulatory requirement in the RFS regulations would not add value or 
provide any benefit, and as noted above is not relevant to the issues 
needed to determine whether the fuel oil is a renewable fuel for 
purposes of the RFS program.

Power Generation

Comment
    Several commenters recommended that the expanded definition of 
heating oil should also include fuel oils used for power generation.
Response
    The restriction on use for the additional fuel oils is necessary so 
that the additional fuel oils can reasonably be considered ``home 
heating oil.'' Congress allowed ``home heating oil'', not any and all 
fuel oils, to be considered an additional renewable fuel for purposes 
of the RFS program. EPA's expanded definition of heating oil includes 
fuel oils that are used for heating places where people live, work, or 
recreate, and not just their homes. EPA believes this is a reasonable 
interpretation of the phrase ``home heating oil'' and 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 them to fuel oils used 
for heating of facilities that people will occupy, and excludes fuel 
oils 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.

Need for Compliance Provisions Associated With the Expanded Definition

Comment
    We received several comments regarding the compliance provisions 
associated with the expanded definition, including the affidavit 
requirement for RFS registration, reporting requirements, PTD 
requirements, and end use tracking required for recordkeeping. 
Commenters who are ready to produce renewable fuel oils for use as 
heating oil expressed their understanding of the need for affidavits 
and their ability to comply with the requirements based on existing and 
prospective customers.
    Other commenters believe that these requirements are not necessary 
and that they will not be able to comply with the affidavit 
requirements. For example, two biomass-based diesel producers asserted 
that they would be unable to submit affidavits because their fuel 
product does not currently qualify as heating oil under the RFS. These 
producers also commented that many of their potential customers will 
not sign the required affidavits out of fear of potential legal 
ramifications. At the same time, parties interested in blending No.4 
and No.6 diesel to be used as heating oil asserted that the affidavit 
requirements will be unworkable for their existing commercial 
arrangements, which tend to be informal, with small customers whose 
employees are not sophisticated enough to comply with the tracking 
requirements.
Response
    EPA believes that the compliance provisions added by this final 
rule are necessary and appropriate to ensure, as far as is practicable, 
that the additional fuel oils under the expanded definition meet the 
requirements of heating oil for purposes of the RFS program. Fuel oils 
that generate RINs under this expanded definition are those that 
actually heat places where people live, work, or recreate, and are not 
used for other purposes such as generating process energy. These 
additional fuel oils are not readily identifiable based on their 
physical characteristics, so the additional registration, recordkeeping 
and reporting requirements are designed to ensure they in fact meet the 
expanded definition of heating oil as far as can practically be 
determined at the time of RIN generation. These requirements are 
tailored to be the least restrictive possible while reasonably ensuring 
compliance with the amended definition of heating oil.
    Such requirements are necessary to ensure RFS programmatic 
integrity, specifically, that RINs generated for the additional fuel 
oils represent fuel oils that qualify under the amended definition. 
Therefore, EPA is requiring producers to identify the end users of 
their fuel oil at the time of registration. Producers who have not 
identified any end users for their product will not be able to produce 
fuel oil for use as heating oil and generate RINs. EPA is aware of 
producers who have customers willing to sign such affidavits. EPA 
believes it is reasonable and producers typically will be able to 
comply with such requirements. If a producer cannot

[[Page 62469]]

meet the affidavit requirements, that producer should not attempt to 
generate RINs using the amended definition of heating oil.
    Similarly, the PTD requirements are necessary and tailored to be as 
least restrictive as possible while ensuring compliance. If a producer 
cannot meet the PTD requirements, that producer should not attempt to 
generate RINs using the amended definition of heating oil. PTDs must 
accompany the fuel oil from production to end use; sale contracts are 
not interchangeable with PTDs but are additionally required for 
recordkeeping.

RIN Generation

Comment
    One commenter suggested that the heating oil definition should 
identify feedstocks and applicable pathways for RIN generation.
Response
    EPA's existing pathways that refer to heating oil as the final RIN-
generating renewable fuel, identified in Table 1 to 40 CFR 80.1426, 
continue to apply without change. This final rule does not change those 
pathways or add a new pathway. It merely adds a new category of fuel 
oils that can qualify as heating oil.

Pipeline Concerns

Comment
    One commenter expressed concern that the new definition will create 
additional segregations of heating oil which will promote 
inefficiencies in the distribution system.
Response
    Based on the information we have received from renewable fuel oil 
producers, the renewable fuel oil qualifying under the expanded 
definition is likely to be a drop-in fuel. As such, it would not be 
distributed through the pipeline system and therefore EPA does not 
believe the amended definition will create any new inefficiencies for 
the pipeline distribution system.

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

B. Paperwork Reduction Act

    The information collection requirements in this 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 requirements are not enforceable until OMB 
approves them.
    This action contains recordkeeping and reporting requirements 
(including registration and product transfer documentation) that may 
affect parties who produce or import renewable fuel oils subject to the 
revised definition of heating oil at 40 CFR 80.1401. 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.\12\ We 
estimate an average annual reporting and recordkeeping burden of 31 
hours and $2,205 per respondent.\13\ 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 Sec.  
1320.3(b).
---------------------------------------------------------------------------

    \12\ We project that the number of affected parties will remain 
essentially constant over time.
    \13\ This includes the time to train staff, formulate and 
transmit responses, and other miscellaneous compliance related 
activities.
---------------------------------------------------------------------------

    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. When this ICR is approved by 
OMB, the Agency will publish a technical amendment to 40 CFR part 9 in 
the Federal Register to display the OMB control number for the approved 
information collection requirements contained in this final rule.

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 action will not have a significant 
economic impact on a substantial number of small entities. This final 
rule will not impose any significant new requirements on small 
entities.

D. Unfunded Mandates Reform Act

    This 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 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 RFS 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

[[Page 62470]]

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 RFS regulations. Thus, Executive 
Order 13132 does not apply to this action.

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

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

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 subject to Executive Order 13211 (66 FR 28355 
(May 22, 2001)), because it is not a significant regulatory action 
under Executive Order 12866.

I. National Technology Transfer and Advancement Act

    Section 12(d) of the National Technology Transfer and Advancement 
Act of 1995 (``NTTAA''), Public Law 104-113, 12(d) (15 U.S.C. 272 note) 
directs EPA to use voluntary consensus standards in its regulatory 
activities unless to do so will 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 (Feb. 16, 1994)) establishes 
Federal executive policy on environmental justice. Its main provision 
directs Federal agencies, to the greatest extent practicable and 
permitted by law, to make environmental justice part of their mission 
by identifying and addressing, as appropriate, disproportionately high 
and adverse human health or environmental effects of their programs, 
policies, and activities on minority populations and low-income 
populations in the United States.
    EPA has determined that this final 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 will not relax the control measures on 
sources regulated by the RFS regulations and therefore will not cause 
emissions increases from these sources.

K. Congressional Review Act

    The Congressional Review Act, 5 U.S.C. 801 et. seq., as added by 
the Small Business Regulatory Enforcement Fairness Act of 1996, 
generally provides that before a rule may take effect, the agency 
promulgating the rule must submit a rule report, which includes a copy 
of the rule, to each House of the Congress and to the Comptroller 
General of the United States. EPA will submit a report containing this 
rule and other required information to the U.S. Senate, the U.S. House 
of Representatives, and the Comptroller General of the United States 
prior to publication of the rule in the Federal Register. A major rule 
cannot take effect until 60 days after it is published in the Federal 
Register. This action is not a ``major rule'' as defined by 5 U.S.C. 
804(2).

VI. Statutory Provisions and Legal Authority

    Statutory authority for the rule finalized today can be found in 
section 211(o) 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, Energy, Forest and Forest Products, Fuel additives, Gasoline, 
Imports, Labeling, Motor vehicle pollution, Penalties, Petroleum, 
Reporting and Recordkeeping requirements.

    Dated: September 24, 2013.
Gina McCarthy,
Administrator.

    For the reasons set forth in the preamble, 40 CFR part 80 is 
amended as follows:

PART 80--REGULATION OF FUELS AND FUEL ADDITIVES

0
1. The authority citation for part 80 continues to read as follows:

    Authority:  42 U.S.C. 7414, 7542, 7545, and 7601(a).

Subpart M--[Amended]

0
2. Section 80.1401 is amended by revising the definition of ``Heating 
oil'' to read as follows:

Sec.  80.1401  Definitions.

* * * * *
    Heating oil means:
    (1) A fuel meeting the definition of heating oil set forth in Sec.  
80.2(ccc); or
    (2) A fuel oil that is used to heat interior spaces of homes or 
buildings to control ambient climate for human comfort. The fuel oil 
must be liquid at 60 degrees Fahrenheit and 1 atmosphere of pressure, 
and contain no more than 2.5% mass solids.
* * * * *

0
3. Section 80.1426 is amended by adding a new paragraph (c)(7) to read 
as follows:

Sec.  80.1426  How are RINs generated and assigned to batches of 
renewable fuel by renewable fuel producers or importers?

* * * * *
    (c) * * *
    (7) For renewable fuel oil that is heating oil as defined in 
paragraph (2) of the definition of heating oil in Sec.  80.1401, 
renewable fuel producers and importers shall not generate RINs unless 
they have received affidavits from the final end user or users of the 
fuel oil as specified in Sec.  80.1451(b)(1)(ii)(T)(3).
* * * * *

[[Page 62471]]

0
4. Section 80.1450 is amended by adding a new paragraph (b)(1)(xi) to 
read as follows:

Sec.  80.1450  What are the registration requirements under the RFS 
program?

* * * * *
    (b) * * *
    (1) * * *
    (xi) For a producer of fuel oil meeting paragraph (2) of the 
definition of heating oil in Sec.  80.1401:
    (A) An affidavit from the producer of the fuel oil stating that the 
fuel oil for which RINs have been generated will be sold for the 
purposes of heating interior spaces of homes or buildings to control 
ambient climate for human comfort, and no other purpose.
    (B) Affidavits from the final end user or users of the fuel oil 
stating that the fuel oil is being used or will be used for purposes of 
heating interior spaces of homes or buildings to control ambient 
climate for human comfort, and no other purpose, and acknowledging that 
any other use of the fuel oil would violate EPA regulations and subject 
the user to civil penalties under the Clean Air Act.
* * * * *

0
5. Section 80.1451 is amended as follows:
0
a. By redesignating paragraph (b)(1)(ii)(T) as paragraph (b)(1)(ii)(U).
0
b. By adding a new paragraph (b)(1)(ii)(T).

Sec.  80.1451  What are the reporting requirements under the RFS 
program?

* * * * *
    (b) * * *
    (1) * * *
    (ii) * * *
    (T) Producers of fuel oil that meets paragraph (2) of the 
definition of heating oil in Sec.  80.1401, shall report, on a 
quarterly basis, all the following for each volume of fuel oil:
    (1) Total volume of fuel oil produced and sold, in units of U.S. 
gallon, and the lower heating value of the fuel oil, in units of BTU 
per U.S. gallon.
    (2) Total volume of fuel oil for which RINs were generated, in 
units of U.S. gallon, and the respective quantities of fuel oil sold, 
organization names and locations of the buildings in which the fuel oil 
was used, and the RIN numbers assigned to each batch of fuel oil.
    (3) For each batch of fuel oil for which RINs are generated that 
the renewable fuel producer claims meets paragraph (2) of the 
definition of heating oil in Sec.  80.1401 and that is sold for the 
purposes specified in paragraph (2), affidavits from end user or users 
of the fuel oil that include the following information:
    (i) Quantity of fuel oil received from producer.
    (ii) Quantity of fuel oil used or to be used for heating interior 
spaces of homes or buildings to control ambient climate for human 
comfort, and for no other purpose.
    (iii) Date the fuel oil was received.
    (iv) Blend level of the fuel oil in petroleum based fuel oil when 
received (if applicable).
    (v) Quantity of assigned RINs received with the fuel oil, if 
applicable.
    (vi) Quantity of assigned RINs that the end user separated from the 
fuel oil, if applicable.
* * * * *
0
6. Section 80.1453 is amended by adding a new paragraph (d) to read as 
follows:

Sec.  80.1453  What are the product transfer document (PTD) 
requirements for the RFS program?

* * * * *
    (d) For fuel oil meeting paragraph (2) of the definition of heating 
oil in Sec.  80.1401, the PTD of the fuel oil shall state: ``This 
volume of renewable fuel oil 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, as 
these uses are prohibited pursuant to 40 CFR 80.1460(g).''.

0
7. Section 80.1454 is amended by adding a new paragraph (b)(8) to read 
as follows:

Sec.  80.1454  What are the recordkeeping requirements under the RFS 
program?

* * * * *
    (b) * * *
    (8) A producer of fuel oil meeting paragraph (2) of the definition 
of heating oil in Sec.  80.1401 shall keep copies of all contracts 
which describe the fuel oil under contract with each end user.
* * * * *
0
8. Section 80.1460 is amended by adding a new paragraph (g) to read as 
follows:

Sec.  80.1460  What acts are prohibited under the RFS program?

* * * * *
    (g) Failing to use a renewable fuel oil for its intended use. No 
person shall use fuel oil that meets paragraph (2) of the definition of 
heating oil in Sec.  80.1401 and for which RINs have been generated in 
an application other than to heat interior spaces of homes or buildings 
to control ambient climate for human comfort.

[FR Doc. 2013-24280 Filed 10-21-13; 8:45 am]
BILLING CODE 6560-50-P
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