Document ID: EPA-HQ-OAR-2021-0845-0084
Agency: epa
Document Type: Rule
Title: Renewable Fuel Standard Program: Canola Oil Pathways to Renewable Diesel, Jet Fuel, Naphtha, Liquefied Petroleum Gas, and Heating Oil
Posted Date: 2022-12-02T05:00Z

[Federal Register Volume 87, Number 231 (Friday, December 2, 2022)]
[Rules and Regulations]
[Pages 73956-73965]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-26250]

[[Page 73956]]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 80

[EPA-HQ-OAR-2021-0845; FRL-9075-02-OAR]
RIN 2060-AV55

Renewable Fuel Standard Program: Canola Oil Pathways to Renewable 
Diesel, Jet Fuel, Naphtha, Liquefied Petroleum Gas, and Heating Oil

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: In this action, EPA determines that renewable diesel, jet 
fuel, heating oil, naphtha, and liquefied petroleum gas (LPG) produced 
from canola/rapeseed oil via a hydrotreating process all meet the 
lifecycle greenhouse gas (GHG) emissions reduction threshold of 50 
percent required for advanced biofuels and biomass-based diesel (BBD) 
under the Renewable Fuel Standard (RFS) program. Based on the analyses 
described in the earlier notice of proposed rulemaking associated with 
this action, EPA is adding these pathways to the list of approved 
pathways in the RFS regulations, making them eligible to generate 
Renewable Identification Numbers (RINs), provided they satisfy the 
other definitional and RIN generation criteria for renewable fuel 
specified in the RFS regulations. EPA is also amending the RFS 
regulations by adding a new definition of ``canola/rapeseed oil.''

DATES: This rule is effective on January 3, 2023.

ADDRESSES: EPA has established a docket for this action under Docket ID 
No. EPA-HQ-OAR-2021-0845. All documents are listed on the https://www.regulations.gov website. Although listed in the index, some 
information is not publicly available, e.g., confidential business 
information (CBI) or other information whose disclosure is restricted 
by statute. Certain other material, such as copyrighted material, is 
not placed on the internet and will be publicly available only in hard 
copy form. Publicly available docket materials are available 
electronically through http://www.regulations.gov.

FOR FURTHER INFORMATION CONTACT: Christopher Ramig, Office of Air and 
Radiation, Office of Transportation and Air Quality, Mail Code: 6401A, 
U.S. Environmental Protection Agency, 1200 Pennsylvania Avenue NW, 
Washington, DC 20460; telephone number: 202-564-1372; email address: 
[email protected].

SUPPLEMENTARY INFORMATION:

Does this action apply to me?

    Entities potentially affected by this final rule are those involved 
with the production, distribution, and sale of transportation fuels, 
including gasoline and diesel fuel or renewable fuels such as 
biodiesel, heating oil, renewable diesel, naphtha, and LPG. Potentially 
regulated categories include:

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                                               Examples of potentially
          Category           NAICS \1\ code       affected entities
------------------------------------------------------------------------
Industry...................          111120  Oilseed (except Soybean)
                                              Farming.
Industry...................          324110  Petroleum refineries
                                              (including importers).
Industry...................          325199  Other basic organic
                                              chemical manufacturing.
Industry...................          424690  Chemical and allied
                                              products merchant
                                              wholesalers.
Industry...................          424710  Petroleum Bulk Stations and
                                              Terminals.
Industry...................          424720  Petroleum and Petroleum
                                              Products Merchant
                                              Wholesalers.
Industry...................          454310  Other fuel dealers.
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\1\ North American Industry Classification System (NAICS).

    This table is not intended to be exhaustive, but rather provides a 
guide for readers regarding entities likely to be regulated or 
otherwise affected by this action. This table lists the types of 
entities that EPA is now aware could potentially be affected by this 
action. Other types of entities not listed in the table could also be 
affected. To determine whether your entity is regulated by this action, 
you should carefully examine the applicability criteria in the 
referenced regulations. If you have any questions regarding the 
applicability of this action to a particular entity, consult the person 
listed in the FOR FURTHER INFORMATION CONTACT section.

Table of Contents

I. Introduction
II. Review and Response to Comments on the Notice of Proposed 
Rulemaking
    A. Comments Received on Our Lifecycle Analysis
    B. Other Comments Received on Our Proposed Pathway 
Determinations
III. Definition of Canola/Rapeseed Oil
IV. Analysis of Lifecycle GHG Emissions
    A. Overview of Lifecycle GHG Emissions Analysis
    B. Data Updates Based on GREET-2021
    C. Summary of Analysis of Lifecycle GHG Emissions
V. Summary
VI. Statutory & Executive Order Reviews
    A. Executive Order 12866: Regulatory Planning and Review and 
Executive Order 13563: Improving Regulation and Regulatory Review
    B. Paperwork Reduction Act (PRA)
    C. Regulatory Flexibility Act (RFA)
    D. Unfunded Mandates Reform Act (UMRA)
    E. Executive Order 13132: Federalism
    F. Executive Order 13175: Consultation and Coordination With 
Indian Tribal Governments
    G. Executive Order 13045: Protection of Children From 
Environmental Health and Safety Risks
    H. Executive Order 13211: Actions Concerning Regulations That 
Significantly Affect Energy Supply, Distribution, or Use
    I. National Technology Transfer and Advancement Act (NTTAA)
    J. Executive Order 12898: Federal Actions To Address 
Environmental Justice in Minority Populations and Low-Income 
Populations
    K. Congressional Review Act (CRA)
VII. Statutory Authority

I. Introduction

    Section 211(o) of the Clean Air Act (CAA) establishes the RFS 
program, under which EPA sets annual percentage standards specifying 
the total amount of renewable fuel, as well as three subcategories of 
renewable fuel, that must be used to reduce or replace fossil fuel 
present in transportation fuel, heating oil, or jet fuel. Non-exempt 
renewable fuels must achieve at least a 20 percent reduction in 
lifecycle GHG emissions as compared to a 2005 petroleum baseline. 
Advanced biofuel and BBD must achieve at least a 50 percent reduction, 
and cellulosic biofuel must achieve at least a 60 percent reduction.\1\
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    \1\ See, generally, 42 U.S.C. 7545(o)(1).
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    In addition to having to meet the applicable lifecycle GHG 
reduction requirements, a fuel may only generate RINs if it meets the 
definitional and other criteria for renewable fuel (e.g., feedstock is 
a qualifying source of

[[Page 73957]]

renewable biomass as defined in the regulations and used to reduce or 
replace the quantity of fossil fuel present in transportation fuel, 
heating oil, or jet fuel) in CAA section 211(o) and the RFS regulations 
at 40 CFR part 80, subpart M.
    Only fuels produced using pathways that EPA has approved as meeting 
all applicable requirements are eligible to generate RINs. There are 
three critical components of fuel pathways under the RFS program: (1) 
fuel type; (2) feedstock; and (3) production process. Each approved 
pathway is associated with a specific ``D code'' corresponding to 
whether the fuel meets the requirements for renewable fuel, advanced 
fuel, cellulosic fuel, or BBD.\2\ Since the formation of the RFS 
program, EPA has periodically promulgated rules to add new pathways to 
the regulations.\3\ In addition, EPA has approved facility-specific 
pathways through the petition process in 40 CFR 80.1416.
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    \2\ For additional information see: https://www.epa.gov/renewable-fuel-standard-program/fuel-pathways-under-renewable-fuel-standard.
    \3\ See, e.g., 83 FR 37735 (August 2, 2018) approving grain 
sorghum oil pathways and 78 FR 41703 (July 11, 2013) approving giant 
reed and Napier grass pathways.
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    EPA's lifecycle analyses are used to assess the overall GHG impacts 
of a fuel throughout each stage of its production and use. The results 
of these analyses, considering uncertainty and the weight of available 
evidence, are used to determine whether a fuel meets the necessary GHG 
reduction threshold required under the CAA. Lifecycle analysis includes 
an assessment of emissions related to the full fuel lifecycle, 
including feedstock production, feedstock transportation, fuel 
production, fuel transportation and distribution, and tailpipe 
emissions. Per the CAA definition of lifecycle GHG emissions,\4\ EPA's 
lifecycle analyses also include an assessment of significant indirect 
emissions, such as those from land use changes (LUC) and agricultural 
sector impacts.
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    \4\ 42 U.S.C. 7545(o)(1)(H).
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    EPA conducted lifecycle GHG analyses for several combinations of 
biofuel feedstocks, production processes, and fuels and promulgated 
several fuel pathways as part of its March 26, 2010 RFS2 final rule (75 
FR 14670) (the ``March 2010 RFS2 rule''). In the preamble to that final 
rule, EPA indicated that it intended to add fuel pathways to the 
regulations via further notice-and-comment rulemakings. EPA 
subsequently completed a proposed assessment for canola oil biodiesel; 
this proposed assessment was published in the Federal Register for 
notice and comment on July 26, 2010 (75 FR 43522). This proposed 
assessment evaluated the GHG emissions associated with biodiesel 
produced from canola oil through a transesterification process. On 
September 28, 2010, EPA published a rule finalizing our determination 
that canola oil biodiesel meets the lifecycle GHG emissions reduction 
threshold of 50 percent required by the CAA and added row G to Table 1 
to 40 CFR 80.1426, making canola oil biodiesel produced through a 
transesterification process eligible for BBD (D-code 4) RINs (75 FR 
59622) (the ``September 2010 Canola Oil rule''). This final rule did 
not include determinations for renewable diesel, jet fuel, naphtha, 
LPG, or heating oil produced from canola oil via a hydrotreating 
process.\5\ In the 2013 Pathways I final rule (78 FR 14190, March 5, 
2013) (the ``2013 Pathways I rule''), EPA added rapeseed oil as a 
feedstock in the existing pathway in row G for renewable fuel made from 
canola oil because ``we had not intended the supplemental determination 
to cover just those varieties or sources of rapeseed that are 
identified as canola'' (78 FR 14214). In that same rule, for clarity 
EPA also added ``heating oil'' to the rows in Table 1 to 40 CFR 80.1426 
that already included renewable diesel or biodiesel (78 FR 14201). As 
in the 2013 Pathways I rule, in this action we are similarly adding new 
pathways to Table 1 to 40 CFR 80.1426 for biofuels produced from 
``canola/rapeseed oil'' but for simplicity we refer to both canola and 
rapeseed as ``canola'' throughout this preamble.
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    \5\ Hydrotreating, the process used to produce the vast majority 
of renewable diesel, consists of catalytic reactions in the presence 
of hydrogen. This process produces a ``drop-in'' fuel with 
properties virtually identical to petroleum diesel and distinct from 
biodiesel.
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    In 2020, the United States Canola Association (USCA) submitted a 
rulemaking petition to EPA requesting an evaluation of the GHG 
emissions associated with renewable diesel, jet fuel, naphtha, LPG, and 
heating oil produced from canola oil via a hydrotreating process, and a 
determination of the renewable fuel categories, if any, for which such 
biofuels may be eligible.\6\
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    \6\ U.S. Canola Association. (2020). Petition for Pathways for 
Renewable Diesel from Canola Oil as ``Advanced Biofuel'' Under the 
Renewable Fuel Standard Program. EPA-HQ-OAR-2021-0845-0040.
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    In response to the USCA petition, EPA conducted an analysis of the 
lifecycle GHG emissions associated with these fuel pathways. In April 
2022, we published this analysis as part of the notice of proposed 
rulemaking (87 FR 22823, April 18, 2022) (the ``Canola NPRM'') 
associated with this final rulemaking.\7\
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    \7\ The full set of modeling results, post-processing 
spreadsheets and other technical documents describing this analysis 
are available in the docket for this action.
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    As described in the Canola NPRM preamble, we estimated the 
lifecycle GHG emissions associated with the production of renewable 
diesel, naphtha, LPG, and jet fuel via a hydrotreating process. The 
Canola NPRM preamble discussed these estimates and our consideration of 
uncertainty in the analysis. Based on this analysis, we proposed to 
find that these biofuels meet the 50 percent GHG reduction threshold 
required for advanced biofuel and BBD. In the Canola NPRM, we also 
proposed a definition of ``canola/rapeseed oil'' to provide clarity 
about which feedstocks would qualify under these proposed pathways.
    In this final action, EPA is adding to Table 1 of 40 CFR 80.1426 
pathways for the production of renewable diesel, jet fuel, naphtha, 
LPG, and heating oil produced from canola oil via a hydrotreating 
process, as proposed. Upon the effective date of this action, these 
fuel pathways are eligible for either BBD (D-code 4) or advanced 
biofuel (D-code 5) RINs, depending on the fuel type and whether they 
are produced through a hydrotreating process that co-processes 
renewable biomass with petroleum. We are also finalizing our proposed 
definition of ``canola/rapeseed oil'' and adding this definition to 40 
CFR 80.1401.

II. Review and Response to Comments on the Notice of Proposed 
Rulemaking

A. Comments Received on Our Lifecycle Analysis

    EPA requested comment on its lifecycle analysis of the GHG 
emissions associated with renewable diesel, jet fuel, naphtha, LPG, and 
heating oil produced from canola oil via a hydrotreating process.
    Several commenters expressed support for our lifecycle analysis. 
Commenters supported EPA's new modeling of canola oil-based fuels using 
updated data on canola and canola products.\8\ Commenters also 
expressed that EPA's updated modeling of international canola market 
conditions better simulates and reflects the behavior of the historical 
and current global canola trade, in particular the

[[Page 73958]]

dynamics between the U.S. and Canada.\9\ Commenters did not provide any 
comments on this analysis that indicate it is unreasonable to rely on 
it for this rulemaking, such as the presence of errors in the analysis, 
the use of outdated data, or any other scientific deficiencies that 
might require EPA to conduct new analysis before finalizing our 
determination. Some commenters stated that EPA's analysis may be overly 
conservative in the sense that, in the opinion of these commenters, our 
analysis may overstate the GHG intensity of canola oil-based fuels. 
Multiple commenters claimed that U.S. canola producers may be able to 
expand canola production on fallow land or Conservation Reserve Program 
(CRP) land, or make changes to crop rotations, to provide additional 
canola seed and oil for biofuel feedstock supply without the need for 
cultivation of new crop area. Commenters argued that, for these reasons 
EPA's estimated cropland change emissions impacts may be too high.\10\ 
However, these commenters did not provide data or information that 
would support specific revisions in our modeling. Regardless, revising 
our analysis in the manner suggested by these commenters would not 
materially affect the results of our determination for these canola oil 
pathways. Since we proposed to determine that the pathways in question 
be approved to generate RINs under the most valuable renewable fuel 
categories (i.e., the advanced biofuel and/or BBD pathways) for which 
they are eligible, further reductions in LUC emissions, were a revised 
analysis to find such a result, would lead to the same pathway 
determination. Finally, commenters who made these points did not state 
that revisions should be made to EPA's analysis before finalizing the 
proposed pathways. Rather, these commenters instead uniformly supported 
the finalization of EPA's analysis and determination as proposed. For 
all of these reasons, we believe no revisions to our lifecycle analysis 
are appropriate or necessary in response to these comments.
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    \8\ See Docket Item No. EPA-HQ-OAR-2021-0845-0053, EPA-HQ-OAR-
2021-0845-0055, EPA-HQ-OAR-2021-0845-0057, EPA-HQ-OAR-2021-0845-
0066, EPA-HQ-OAR-2021-0845-0068, EPA-HQ-OAR-2021-0845-0069.
    \9\ See Docket Item No. EPA-HQ-OAR-2021-0845-0066, EPA-HQ-OAR-
2021-0845-0072.
    \10\ See, e.g., Docket Item No. EPA-HQ-OAR-2021-0845-0053, EPA-
HQ-OAR-2021-0845-0055, EPA-HQ-OAR-2021-0845-0063, EPA-HQ-OAR-2021-
0845-0066, EPA-HQ-OAR-2021-0845-0076.
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    Commenters supported our inclusion of pathways for fuels produced 
from co-processing canola oil with petroleum feedstocks, i.e., co-
processed fuels.\11\ In their comments, Phillips 66 suggested 
additional data sources about the emissions associated with co-
processing of canola oil via hydrotreating, which EPA could consider if 
needed. However, neither Phillips 66 nor any other commenter who 
addressed co-processing suggested that any revision of this aspect of 
our analysis was needed. Further, revising our analysis to consider the 
additional data provided by Phillips 66 would not materially affect the 
results of our determination for these canola oil pathways. We believe 
no revisions to our lifecycle analysis are appropriate or necessary in 
response to these comments.
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    \11\ See, e.g., Docket Item No. EPA-HQ-OAR-2021-0845-0079.
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    The American Petroleum Institute (API) observed that lifecycle 
analysis methodology was the focus of a recent EPA workshop on biofuel 
GHG modeling.\12\ API expressed support for the efforts of EPA to 
consider new science and data in the context of biofuel lifecycle 
analysis. However, API also expressed that the scientific discussions 
at this workshop should not necessitate any revisions to the analysis 
conducted for the Canola NPRM. Rather, this commenter stated that any 
such revisions should be considered in the future in the context of 
more holistic re-examination of RFS pathways, so that they can be 
applied consistently across all approved pathways.\13\ EPA did not 
propose to apply a new lifecycle analysis methodology to canola oil, 
and we are not doing so in this final rule. Any decisions EPA may make 
about future lifecycle analyses and determinations are outside the 
scope of this rulemaking.
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    \12\ For information regarding this workshop, see Docket No. 
EPA-HQ-OAR-2021-0921.
    \13\ See Docket Item No. EPA-HQ-OAR-2021-0845-0058.
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    In the proposed rule we requested comment on our proposed use of an 
energy allocation approach to evaluate co-products from hydrotreating 
processes (87 FR 22838). We received two comments on this topic.\14\ 
One of the commenters said they agree with EPA's reasoning and support 
the energy allocation approach taken. The other commenter did not 
oppose EPA's use of energy allocation, but believes it is a 
conservative approach that may not be appropriate in all cases. Based 
on these comments, and the reasons given in the proposed rule, we are 
retaining the proposed energy allocation approach to the evaluation of 
the co-products from hydrotreating processes. Furthermore, for the 
reasons discussed in the proposed rule, we believe that energy 
allocation is generally the most appropriate approach for co-products 
that may be used as transportation fuel. Unlike the displacement 
approach, the allocation approach does not depend on which co-products 
generate RINs (or for which producers request RIN eligibility), which 
is subject to change based on market and regulatory conditions.
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    \14\ Docket Item No. EPA-HQ-OAR-2021-0845-0079 and EPA-HQ-OAR-
2021-0845-0072.
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    We have determined that no changes to our proposed lifecycle 
analysis of the GHG emissions associated with renewable diesel, jet 
fuel, naphtha, LPG, and heating oil produced from canola oil via a 
hydrotreating process are necessary or appropriate based on the public 
comments received. However, as discussed in section IV of this action, 
we are updating emission factors from GREET-2020 to GREET-2021, 
consistent with our intention as expressed in the Canola NPRM preamble. 
Further information on our lifecycle analysis is available in the 
Canola NPRM preamble \15\ and the docket for this rulemaking.\16\
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    \15\ See 87 FR 22826-40.
    \16\ See Docket No. EPA-HQ-OAR-2021-0845.
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B. Other Comments Received on Our Proposed Pathway Determinations

    EPA received other comments on our determination that renewable 
diesel, jet fuel, naphtha, LPG, and heating oil meet the 50 percent GHG 
reduction threshold required for advanced biofuel and BBD, but these 
comments did not directly address our lifecycle analysis of the 
proposed canola oil pathways. These comments are summarized below.
    Several commenters expressed general support for the finalization 
of our proposed determination. Commenters associated with the canola 
production and processing industries expressed an ability to provide 
feedstock to the biofuel industry to produce fuels under the proposed 
canola oil pathways.\17\ Commenters argued that approval of these 
pathways would provide several economic and societal benefits, 
including supporting rural economies,\18\ reducing U.S. GHG 
emissions,\19\ providing greater feedstock diversity to the biofuel 
industry (particularly for renewable diesel and jet fuel),\20\ and 
reducing reliance on

[[Page 73959]]

imported petroleum.\21\ Commenters also stated that the lack of a 
renewable diesel pathway in particular has been an impediment to the 
canola industry and that approval of this pathway would provide a more 
level playing field with other renewable diesel feedstocks.\22\
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    \17\ See, e.g., Docket Item No. EPA-HQ-OAR-2021-0845-0052, EPA-
HQ-OAR-2021-0845-0053, EPA-HQ-OAR-2021-0845-0055.
    \18\ See, e.g., Docket Item No. EPA-HQ-OAR-2021-0845-0053, EPA-
HQ-OAR-2021-0845-0055, EPA-HQ-OAR-2021-0845-0068.
    \19\ See, e.g., Docket Item No. EPA-HQ-OAR-2021-0845-0053, EPA-
HQ-OAR-2021-0845-0054, EPA-HQ-OAR-2021-0845-0055, EPA-HQ-OAR-2021-
0845-0062, EPA-HQ-OAR-2021-0845-0066, EPA-HQ-OAR-2021-0845-0068.
    \20\ See, e.g., Docket Item No. EPA-HQ-OAR-2021-0845-0054, EPA-
HQ-OAR-2021-0845-0055, EPA-HQ-OAR-2021-0845-0057, EPA-HQ-OAR-2021-
0845-0062, EPA-HQ-OAR-2021-0845-0065, EPA-HQ-OAR-2021-0845-0068.
    \21\ See, e.g., Docket Item No. EPA-HQ-OAR-2021-0845-0062, EPA-
HQ-OAR-2021-0845-0070.
    \22\ See, e.g., Docket Item No. EPA-HQ-OAR-2021-0845-0055, EPA-
HQ-OAR-2021-0845-0066, EPA-HQ-OAR-2021-0845-0069.
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    Several commenters supported our proposed determination that no 
invasive species-related risk management measures are appropriate in 
the context of these canola oil pathways. The Minnesota Canola Council 
stated in their comments that ``[c]anola has been grown throughout the 
U.S. for decades without posing invasiveness concerns''.\23\ Other 
comments addressing the topic of canola invasiveness potential 
concurred with this statement.\24\ We did not receive comment 
suggesting that canola has any significant potential to become invasive 
in the United States, nor did any commenters suggest that risk 
management measures would be appropriate for these canola oil pathways.
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    \23\ See Docket Item No. EPA-HQ-OAR-2021-0845-0053.
    \24\ See, e.g., Docket Item No. EPA-HQ-OAR-2021-0845-0055, EPA-
HQ-OAR-2021-0845-0063, EPA-HQ-OAR-2021-0845-0066, EPA-HQ-OAR-2021-
0845-0072.
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    Airlines for America provided comments observing that EPA's 
proposed revisions to the RFS regulations included certain minor 
technical errors.\25\ Specifically, according to the proposed 
regulations included in the Canola NPRM, the term ``Distillers corn 
oil'' would be deleted and replaced with ``Non-food grade corn oil'' 
and ``Commingled distillers corn oil and sorghum oil'' would be deleted 
entirely from the feedstock column in row H. These changes were 
unintentional errors. Airlines for America acknowledged in their 
comments that these errors were likely unintentional and requested that 
EPA clarify in the preamble of the final rule that this is the case. We 
clarify here that these proposed changes were in fact unintentional 
errors. EPA is not finalizing these changes to the regulations.
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    \25\ See Docket Item No. EPA-HQ-OAR-2021-0845-0065.
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    EPA received comments from the Pet Food Institute (PFI) opposing 
the proposed pathway on the grounds that approving these canola oil-
based pathways would create additional financial hardship for PFI's 
member companies, for whom vegetable oils are an important product 
input. In their comments, PFI observed that prices for vegetable- and 
animal-based fats, oils, and greases (FOG) are presently high in 2022. 
They argued that approving these pathways would create additional 
upward pressure on FOG prices and reduce FOG availability for their 
member companies.\26\ These comments mirrored similar comments 
submitted by PFI on a separate recent RFS rulemaking, namely the 
Proposed RFS Standards for 2020, 2021, and 2022.\27\ EPA's Response to 
Comment (RTC) document associated with that rulemaking addresses these 
comments in the broader context of RFS program impacts on FOG 
availability and prices, inclusive of impacts attributable to canola 
oil-based fuels.\28\ As was discussed in this earlier RTC document, EPA 
recognizes that prices for these FOG commodities have been relatively 
high in 2022. However, we also note that several companies, including 
both renewable diesel producers and other parties, have already begun 
to respond to this price signal by announcing investment in increased 
vegetable oil refining capacity.\29\ Thus, we believe that the market 
is adjusting to supply the necessary volumes of refined vegetable oil 
to both the biofuel and food markets, and we do expect that both human 
and animal food producers will be able to acquire the refined vegetable 
oil they need in 2022 and future years. In addition, aggregate demand 
for vegetable oil-based fuels under the RFS program is primarily a 
function of the annual Renewable Volume Obligations (RVOs), not any 
individual pathway approval. To the extent that any FOG price impacts 
may be associated with demand created by the RFS program, EPA believes 
such impacts would be associated with the decisions about the levels at 
which RVOs are set, not approvals of individual fuel pathways. PFI does 
not present evidence that approving additional fuel pathways in and of 
itself will cause a direct increase in overall consumption of biofuels 
under the RFS program or cause an increase in FOG prices and we do not 
believe such outcomes will result from this action. Additionally, 
several commenters on the Canola NPRM argued the opposite, i.e., that 
approval of these pathways is likely to create additional flexibility 
for biofuel producers, increase economic efficiency, and reduce 
prices.\30\ In general, we agree that creating additional flexibility 
under the RFS program is likely to, if anything, reduce feedstock 
prices.
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    \26\ Docket Item No. EPA-HQ-OAR-2021-0845-0077.
    \27\ 86 FR 72436-501. PFI's comments are available on the docket 
for this rulemaking, Docket No. EPA-HQ-OAR-2021-0324-0453.
    \28\ See Section 4.2, Renewable Fuel Standard (RFS) Program: RFS 
Annual Rules--Response to Comments, EPA-420-R-22-009, June 2022.
    \29\ Id.
    \30\ See, e.g., Docket Item No. EPA-HQ-OAR-2021-0845-0054, EPA-
HQ-OAR-2021-0845-0055, EPA-HQ-OAR-2021-0845-0057, EPA-HQ-OAR-2021-
0845-0062, EPA-HQ-OAR-2021-0845-0065, EPA-HQ-OAR-2021-0845-0068.
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    Finally, CAA section 211(o)(1) contains the exclusive 
considerations for evaluating whether a fuel qualifies as BBD or 
advanced biofuel. As further explained in the response to comments 
regarding the Endangered Species Act (ESA) below, the statute provides 
that EPA consider whether the fuel meets the definition of renewable 
fuel (produced from renewable biomass and used to replace or reduce the 
quantity of fossil fuel present in a transportation fuel), whether it 
provides the qualifying lifecycle greenhouse gas reduction as compared 
to baseline petroleum fuel, and whether the biomass is co-processed 
with petroleum feedstocks (see CAA section 211(o)(1)(D)). The statutory 
definitions and scheme leave EPA no discretion to decline to qualify a 
biofuel as BBD or advanced biofuel under the RFS program based on 
additional considerations that are not identified in the statute, such 
as price impacts on canola-oil feedstocks. These factors, again, 
represent the full range of considerations that EPA is authorized to 
consider in determining whether a fuel qualifies as BBD or advanced 
biofuel. In light of this carefully constrained statutory scheme, EPA 
is without authority to alter this rule based on vegetable oil price 
considerations, and EPA has no discretion to deny approval of this 
pathway if the statutory criteria are met. As noted above, to the 
extent any FOG price impacts may be associated with demand created by 
the RFS program, we believe such impacts would be associated with 
decisions made about the levels at which the RVOs are set, not 
approvals of individual fuel pathways. Thus, we consider PFI's comments 
outside the scope of this action.
    EPA received comments from the Center for Biological Diversity 
(CBD) opposing our proposed determination on the grounds that approval 
of this pathway would increase the production of canola to meet new 
biofuel demands, which would in turn allegedly cause harmful effects 
for a least five species \31\

[[Page 73960]]

listed under the ESA. CBD argues that these alleged effects would cross 
the ``may effect'' and/or ``likely to adversely affect'' thresholds 
relevant to ESA considerations and thus trigger consultation 
requirements under the ESA and its implementing regulations. They state 
that EPA's approval of the proposed canola oil pathways represents a 
discretionary programmatic action. On this basis, CBD argues EPA must 
therefore consult with the U.S. Fish and Wildlife Service and the 
National Marine Fisheries Service (hereinafter collectively referred to 
as ``the Services'') under section 7 of ESA before finalizing these 
canola oil pathways.
---------------------------------------------------------------------------

    \31\ The comments identify these species as the Pallid Sturgeon 
(Scaphirhynchus albus), the Whooping Crane (Grus americana), the 
Dakota Skipper (Hesperia dacotae), the Western Prairie Fringed 
Orchid (Platanthera praeclara) and the Poweshiek Skipperling 
(Oarisma poweshiek).
---------------------------------------------------------------------------

    Contrary to CBD's assertions, for this action, we find that EPA 
lacks discretion to disapprove this pathway petition on the basis of 
impacts to listed species or designated critical habitat of such 
species. Section 7(a)(2) of the ESA requires federal agencies, in 
consultation with one or both of the Services, to ensure that actions 
they authorize, fund, or carry out are not likely to jeopardize the 
continued existence of federally listed endangered or threatened 
species or result in the destruction or adverse modification of 
designated critical habitat of such species.\32\ Under relevant 
implementing regulations and case law, section 7(a)(2) applies only to 
actions where there is discretionary federal involvement or 
control.\33\
---------------------------------------------------------------------------

    \32\ 16 U.S.C. 1536(a)(2).
    \33\ 50 CFR 402.03; National Ass'n of Home Builders v. Defenders 
of Wildlife, 127 S. Ct. 2518 (2007) (Defenders of Wildlife).
---------------------------------------------------------------------------

    In Defenders of Wildlife, the Supreme Court evaluated a claim that 
EPA was required to engage in section 7 consultation in the context of 
its approval of a state permitting program under the Clean Water Act 
(CWA). In that case, the Court held that when a Federal agency is 
required by statute to undertake a particular action without 
considering species impacts, there is no relevant agency discretion, 
and thus the requirements of ESA section 7(a)(2) do not apply.\34\ With 
regard to EPA's transfer of CWA permitting authority to a State, the 
relevant CWA provision specified that EPA ``shall approve'' a state 
permitting program if a list of CWA statutory criteria are met. The 
Court found that the relevant CWA program approval criteria did not 
include consideration of endangered or threatened species and stated 
that ``[n]othing in the text of [the relevant CWA provision] authorizes 
EPA to consider the protection of threatened or endangered species as 
an end in itself when evaluating [an] application'' to transfer a 
permitting program to a State.\35\ Accordingly, the Court held that the 
CWA required EPA to approve the state's permitting program if the 
statutory criteria were met; those criteria did not include the 
consideration of ESA-protected species; and thus, consistent with 50 
CFR 402.03, the nondiscretionary action to transfer CWA permitting 
authority to the state did not trigger ESA section 7 consultation 
requirements.
---------------------------------------------------------------------------

    \34\ Defenders of Wildlife at 2536.
    \35\ Id. at 2537.
---------------------------------------------------------------------------

    Similar to the CWA program approval provision at issue in Defenders 
of Wildlife, the CAA contains detailed provisions specifying the 
parameters of fuels that qualify under this regulatory program.\36\ 
None of those provisions provide EPA the discretion to modify its 
evaluation of potential qualifying fuels based on extra-statutory 
criteria. Of relevance here, the CAA includes detailed definitions of 
the terms ``advanced biofuel'' and ``biomass-based diesel,'' and those 
definitions do not allow for consideration of impacts to threatened or 
endangered species in this action.
---------------------------------------------------------------------------

    \36\ 42 U.S.C. 7545(o)(1).
---------------------------------------------------------------------------

    Advanced biofuel is defined as ``renewable fuel, other than ethanol 
derived from corn starch, that has lifecycle greenhouse gas emissions, 
as determined by the Administrator, after notice and opportunity for 
comment, that are at least 50 percent less than baseline lifecycle 
greenhouse gas emissions.'' \37\ This definition includes defined terms 
within it, including the terms ``renewable fuel,'' (``[f]uel that is 
produced from renewable biomass and that is used to replace or reduce 
the quantity of fossil fuel present in a transportation fuel''), 
``baseline lifecycle greenhouse gas emissions'' (``average lifecycle 
greenhouse gas emissions . . . for gasoline or diesel . . . sold or 
distributed as transportation fuel in 2005''), and ``lifecycle 
greenhouse gas emissions''. The term ``lifecycle greenhouse gas 
emissions'' means the aggregate quantity of greenhouse gas emissions 
(including direct emissions and significant indirect emissions such as 
significant emissions from land use changes), as determined by the 
Administrator, related to the full fuel lifecycle, including all stages 
of fuel and feedstock production and distribution, from feedstock 
generation or extraction through the distribution and delivery and use 
of the finished fuel to the ultimate consumer, where the mass values 
for all greenhouse gases are adjusted to account for their relative 
global warming potential.\38\
---------------------------------------------------------------------------

    \37\ 42 U.S.C. 7545(o)(1)(B).
    \38\ 42 U.S.C. 7545(o)(1)(J), (H).
---------------------------------------------------------------------------

    Thus, in determining if a fuel qualifies as advanced biofuel, EPA 
must consider whether it meets the definition of renewable fuel--that 
is, whether it is made from ``renewable biomass'' as defined in the 
statute and is ``used to replace or reduce the quantity of fossil fuel 
present in transportation fuel.'' EPA must also consider whether a fuel 
is made from corn starch, and whether it satisfies the requirement that 
it achieve a 50 percent lifecycle GHG emissions reduction as compared 
to baseline lifecycle greenhouse gas emissions. These factors represent 
the full range of considerations that EPA is authorized to consider in 
determining whether a fuel qualifies as advanced biofuel; it follows 
that EPA is not authorized to consider impacts to threatened or 
endangered species in determining what fuels qualify as advanced 
biofuels under the CAA. In light of this carefully constrained 
statutory scheme, EPA is without authority to alter this rule based on 
listed species considerations and is under no obligation to consult 
with the Services under section 7(a) of the ESA with respect to the 
advanced biofuel pathways established in this action that utilize 
canola oil feedstock to produce renewable diesel. EPA has no discretion 
to deny approval of this pathway if the statutory criteria are met.
    The same is true with respect to the pathways approved in this 
action for the production of BBD from canola oil. The term biomass-
based diesel is defined in the CAA as renewable fuel that is biodiesel 
as defined in section 13220(f) of this title and that has lifecycle 
greenhouse gas emissions . . . that are at least 50 percent less than 
the baseline lifecycle greenhouse gas emissions. Notwithstanding the 
preceding sentence, renewable fuel derived from co-processing biomass 
with a petroleum feedstock shall be advanced biofuel if it meets the 
requirements of [42 U.S.C. 7545(o)(1)(B)], but is not biomass-based 
diesel.\39\
---------------------------------------------------------------------------

    \39\ 42 U.S.C. 7545(o)(1)(D).
---------------------------------------------------------------------------

    The term ``biodiesel'' is defined in 42 U.S.C. 13220(f) to mean ``a 
diesel fuel substitute produced from nonpetroleum renewable resources 
that meets the registration requirements for fuels and fuel additives 
established by the Environmental Protection Agency under section 211 of 
the Clean Air Act [42 U.S.C. 7545]'' and ``includes biodiesel derived 
from--(i) animal wastes, including poultry fats and poultry

[[Page 73961]]

wastes, and other waste materials; or (ii) municipal solid waste and 
sludges and oils derived from wastewater and the treatment of 
wastewater.'' Thus, in evaluating whether a fuel qualifies as BBD, EPA 
is authorized to consider only whether the fuel meets the definition of 
renewable fuel (made from renewable biomass and used to replace or 
reduce the quantity of fossil fuel present in a transportation fuel), 
whether it provides a qualifying lifecycle GHG reduction as compared to 
baseline petroleum fuel, whether the biomass is co-processed with 
petroleum feedstocks, and whether it meets the registration 
requirements for fuels and fuel additives established via rulemaking by 
EPA. These factors, again, represent the full range of considerations 
that EPA is authorized to consider in determining whether a fuel 
qualifies as BBD; it follows that EPA is not authorized to consider 
impacts to threatened or endangered species in determining what fuels 
qualify as BBD under the CAA. In light of this carefully constrained 
statutory scheme, EPA is without authority to alter this rule based on 
listed species considerations and is under no obligation to consult 
with the Services under section 7(a) of the ESA with respect to the 
advanced biofuel pathways established in this action that utilize 
canola oil feedstock to produce BBD. EPA has no discretion to deny 
approval of this pathway if the statutory criteria are met.
    The action EPA is taking today is to determine that renewable 
diesel, jet fuel, heating oil, naphtha, and LPG produced from canola 
oil via a hydrotreating process meet the applicable statutory 
requirements and thus qualify as renewable fuels under the RFS program. 
EPA is not establishing volume requirements, which would require the 
use of renewable fuel of various quantities and types (without 
requiring any particular type of renewable fuel). EPA is currently 
engaged in consultation with the Services on renewable fuel standards 
and will consider the future use of canola oil under the RFS program in 
that context. As discussed in response to comments from PFI, it is the 
RFS standards that could impact demand for advanced biofuel and 
biomass-based diesel; this pathway approval simply provides an 
additional opportunity and flexibility that renewable fuel producers 
may choose to adopt. Additionally, through the ongoing consultation 
process, EPA will consider any impacts on species and designated 
critical habitat as a result of our action setting RFS standards, 
including any impacts associated with the use of canola oil to produce 
renewable fuel within the RFS program, and will also consider any 
appropriate responses.

III. Definition of Canola/Rapeseed Oil

    EPA received comments on its proposed definition of ``canola/
rapeseed oil.'' Joint comments from three Canadian canola industry 
organizations expressed that they believe ``canola and rapeseed are 
well understood crops in the United States'' and that, therefore, they 
``do not believe definitions are necessary.'' \40\ However, these 
commenters also stated that they ``do not necessarily take issue with 
the proposed definitions, which [they] believe identify the key species 
being used for canola production in Canada today, so long as EPA makes 
clear that it does not intend to impose additional requirements on 
farmers or feedstock providers and that these terms are only intended 
to be descriptors to distinguish canola and rapeseed based on the 
distinct treatment of these crops in the U.S.'' \41\ The USCA expressed 
similar opinions in their comments. While they believe the relevant 
market participants fully understand the meaning of ``canola oil,'' and 
that, therefore, no definition in the regulations is necessary, USCA 
also expressed that they do not oppose the addition of this definition 
to the regulations.\42\
---------------------------------------------------------------------------

    \40\ Docket Item No. EPA-HQ-OAR-2021-0845-0066.
    \41\ Id.
    \42\ Docket Item No. EPA-HQ-OAR-2021-0845-0072.
---------------------------------------------------------------------------

    To clarify, EPA has not proposed, nor are we finalizing, any new 
registration, recordkeeping, or reporting requirements associated with 
implementing the canola oil-based pathways or our new definition of 
canola/rapeseed oil. We are including this definition in the 
regulations to provide clarity regarding which vegetable oil products 
qualify under this pathway. This intent is well-aligned with that 
described by the commenters. We are finalizing the definition largely 
as proposed, with one minor, clerical edit for readability.

IV. Analysis of Lifecycle GHG Emissions

A. Overview of Lifecycle GHG Emissions Analysis

    For the proposed rule, we evaluated the lifecycle GHG emissions of 
producing renewable diesel and other biofuels from canola oil through a 
hydrotreating process. We described our methodology for conducting this 
evaluation, the assumptions and scenarios evaluated using this 
methodology, and the results of our analysis. We used the same biofuel 
lifecycle analysis methodology and modeling framework developed for the 
March 2010 RFS2 rule, which was adopted after an extensive peer review 
and public comment process. This methodology was developed to estimate 
``lifecycle greenhouse gas emissions'' as defined in CAA section 
211(o)(1)(H). The same methodology and modeling framework were 
subsequently used for the September 2010 Canola Oil Rule.\43\ The 
components of this methodology generally involve the use of 
agricultural modeling to estimate emissions from land use change, crop 
production, livestock, and rice methane, as well as application of 
coefficients and assumptions from the Greenhouse Gases, Regulated 
Emissions, and Energy use in Technologies (GREET) model \44\ and other 
sources to evaluate emissions associated with feedstock and fuel 
transport, processing, and use.
---------------------------------------------------------------------------

    \43\ For information about our 2010 methodology and analysis see 
section 2 of the regulatory impact analysis (RIA) for the March 2010 
RFS2 rule and the associated lifecycle results (Docket Item No. EPA-
HQ-OAR-2005-0161-3173).
    \44\ See documentation and description available from Argonne 
National Lab at https://greet.es.anl.gov.
---------------------------------------------------------------------------

    In general, this methodology also involves using two agricultural 
sector models, FASOM and the FAPRI-CARD model, to estimate U.S. and 
non-U.S. GHG emissions impacts, respectively. Applying our methodology 
in the analysis conducted for the Canola NPRM, we modeled and evaluated 
a hypothetical canola oil demand shock scenario to estimate changes in 
agricultural production and land use and associated GHG emissions 
associated with the biofuel pathways under consideration. In the demand 
shock scenario modeled for our Canola NPRM analysis, U.S. domestic 
consumption of canola oil-based fuels was assumed to increase by some 
amount relative to the volume of U.S. domestic consumption in a 
reference scenario.
    This methodology also includes estimating GHG emissions associated 
with fuel production, distribution and use based on data from GREET and 
other sources. All of these GHG emissions estimates are added together 
and divided by the change in the amount of biofuel produced in the 
scenarios evaluated to estimate the lifecycle GHG emissions associated 
with fuel produced through the evaluated pathway, in terms of carbon 
dioxide-equivalent emissions per megajoule (MJ) of fuel produced.

[[Page 73962]]

    We stated in section II.C.1 of the Canola NPRM that we would update 
emissions factor assumptions from GREET-2020 to GREET-2021 for the 
final rule. We received no public comment on this statement or our 
intention to update to GREET-2021 for the final rule. We have made 
these updates for the final rule and describe the impacts of these 
updates below.
    Other than updating particular emissions factors based on GREET-
2021 as we committed to do in the proposed rule, we are finalizing our 
lifecycle GHG analysis as proposed. Detailed information and discussion 
regarding the other components of our methodology is available in the 
Canola NPRM preamble \45\ and the docket for this rulemaking.\46\ We 
summarize the results of our updated lifecycle analysis in section IV.C 
below.
---------------------------------------------------------------------------

    \45\ See 87 FR 22826-40.
    \46\ See Docket No. EPA-HQ-OAR-2021-0845.
---------------------------------------------------------------------------

B. Data Updates Based on GREET-2021

    Based on the lifecycle analysis methodology developed for the March 
2010 RFS2 rule, our analysis uses data from the GREET model on the 
emissions per unit of energy or mass associated with particular inputs 
to the product lifecycle (``emissions factors''). These emissions 
factors are the estimates from GREET associated with using inputs such 
as diesel, electricity, and natural gas. In the proposal we said that 
we would update these data based on GREET-2021, and that we did not 
expect these updates to have a large enough effect on the lifecycle GHG 
emissions estimates to change our GHG reduction threshold 
determinations for the proposed canola oil-based fuel pathways. We have 
made the data updates based on GREET-2021 and as expected these updates 
have a relatively small effect on our lifecycle GHG estimates.\47\
---------------------------------------------------------------------------

    \47\ The lifecycle GHG calculations including the updated GREET 
emissions factors are included in a spreadsheet available in the 
docket for this action.
---------------------------------------------------------------------------

    The GREET data updates were applied to the following elements: 
emissions factors for the production and use of gasoline, diesel, 
natural gas, LPG, coal, gaseous hydrogen, electricity, fertilizer, 
herbicide, and insecticide. The emissions factors increased for 
gasoline, diesel, natural gas, LPG, fertilizer, and pesticide.\48\ The 
emissions factors decreased for gaseous hydrogen, electricity, 
limestone, and herbicide. Overall, these updates changed our lifecycle 
GHG estimates by less than two percent. For canola oil renewable 
diesel, we now estimate GHG reductions of 64-70 percent relative to the 
baseline, compared to 63-69 percent in the proposal. For canola oil-
based naphtha and LPG we estimate GHG reductions of 63-69 percent, 
unchanged from the proposal. For canola oil-based renewable jet fuel we 
estimate GHG reductions of 58-67 percent, compared to 59-67 percent in 
the proposal.
---------------------------------------------------------------------------

    \48\ We corrected an underestimate in the proposed rule of the 
GHG emissions associated with crude oil extraction.
---------------------------------------------------------------------------

C. Summary of Analysis of Lifecycle GHG Emissions

    Table IV.C-1 reports our estimates of the lifecycle GHG emissions 
associated with renewable diesel produced from canola oil through a 
hydrotreating process, and the corresponding percent reduction relative 
to the petroleum baseline. Three sets of estimates are presented for 
canola oil renewable diesel. The emissions categories are aggregated to 
simplify the presentation of the table. Domestic and international 
agricultural emissions include emissions associated with changes in 
crop and livestock production. Feedstock processing (i.e., canola seed 
crushing) and feedstock seed and oil transport emissions are reported 
together. Downstream and use includes emissions from fuel distribution 
and fuel use. Land use change emissions include emissions from domestic 
and international land use changes, including both emissions from 
direct conversion to cropland and market-mediated effects such as 
foregone potential land carbon sequestration. As discussed in section 
IV.B, we have made minor updates relative to the proposed rule by 
incorporating more recent emissions factors from the GREET-2021 model. 
These updates changed our GHG estimates in the tables below for the 
feedstock transport & crushing, fuel production, and downstream & use 
lifecycle stages. All other estimates remain unchanged from the NPRM.
    Our evaluation considers uncertainty in international land use 
change emissions based on the methodology used for the March 2010 RFS2 
rule. The table includes a range of land use change estimates based on 
our analysis of this uncertainty. The first column includes results 
based on our average estimate of international land use change GHG 
emissions. We also report results for the low and high ends of our 95 
percent confidence interval for international land use change 
emissions. Our calculations include ranges for domestic agriculture, 
international agriculture, feedstock transport and crushing, and fuel 
production are based on estimated ranges in the yield of finished fuel 
(in MJ of fuel produced per pound of canola oil feedstock). However, to 
simplify the presentation of the results we report the average of the 
eight estimates.\49\
---------------------------------------------------------------------------

    \49\ Using the average or median values results in the same 
percent GHG reduction relative to the petroleum baseline. We are not 
taking a position on whether it is more appropriate to use mean or 
median values in other contexts.
---------------------------------------------------------------------------

    Another update is that the analysis for the March 2010 RFS2 rule 
used 100-year global warming potential (GWP) values from the IPCC 
Second Assessment Report. The analysis for this proposed rule uses 100-
year GWP values from the most recent IPCC Fifth Assessment Report.\50\ 
Based on these updates, the GWP for methane increased from 21 to 30, 
and the GWP for nitrous oxide decreased from 310 to 265. This update 
was described in section II.C.1 of the NPRM; we did not receive public 
comment on this update.
---------------------------------------------------------------------------

    \50\ IPCC, 2014: Climate Change 2014: Synthesis Report. 
Contribution of Working Groups I, II and III to the Fifth Assessment 
Report of the Intergovernmental Panel on Climate Change [Core 
Writing Team, R.K. Pachauri and L.A. Meyer (eds.)]. IPCC, Geneva, 
Switzerland, 151 pp.

    Table IV.C-1-Lifecycle GHG Emissions Associated With Renewable Diesel Produced From Canola Oil Through a
                                              Hydrotreating Process
                                       [In grams of CO2 equivalent per MJ]
----------------------------------------------------------------------------------------------------------------
 
----------------------------------------------------------------------------------------------------------------
               Emissions category                   2005 Diesel
                                                     baseline               Canola oil renewable diesel
----------------------------------------------------------------------------------------------------------------
Domestic Agriculture............................              18                       -2.3
International Agriculture.......................  ..............                       -0.3
Feedstock Transport & Crushing..................  ..............                        6.9
Fuel Production.................................  ..............                        12.4

[[Page 73963]]

 
                                                                                        0.4
                                                                 -----------------------------------------------
Downstream & Use................................              75
Land Use Change Estimate........................  ..............            Mean             Low            High
Land Use Change.................................  ..............            13.8             3.2            26.0
Net Emissions...................................              93            30.9            20.2            43.1
% GHG Reduction Relative to Baseline............  ..............             67%             78%             53%
----------------------------------------------------------------------------------------------------------------

    In many cases, when vegetable oils are hydrotreated to produce 
renewable diesel, there are co-product outputs of naphtha, LPG, and jet 
fuel. The GHG estimates for these co-product fuels differ slightly from 
the renewable diesel estimates presented in the table above based on 
differences in how they are transported to end users and in end use 
emissions. The results for naphtha and LPG, based on the mean 
international land use change estimates, are summarized in Table IV.C-
2.

  Table IV.C-2--Lifecycle GHG Emissions Associated With Naphtha and LPG
        Produced From Canola Oil Through a Hydrotreating Process
                   [In grams of CO2 equivalent per MJ]
------------------------------------------------------------------------
                                                        Naphtha     LPG
------------------------------------------------------------------------
Lifecycle GHG Emissions..............................       31.4    31.4
Percent Reduction Relative to Baseline...............        67%     66%
------------------------------------------------------------------------

    We do not present separate results of heating oil as it is not 
reported as an output for any of the hydrotreating processes evaluated. 
However, renewable diesel could be used as heating oil if market 
conditions change substantially (e.g., if heating oil prices were to 
exceed diesel prices net of government incentives). The GHG emissions 
associated with heating oil are therefore very similar to renewable 
diesel, although there may be small differences in GHG emissions 
associated with fuel distribution and use.
    As discussed in the NPRM,\51\ canola oil hydrotreating processes 
that are set up to maximize jet fuel output require more processing and 
hydrogen, resulting in greater lifecycle GHG emissions. The range of 
lifecycle GHG estimates for canola oil renewable jet fuel are reported 
in Table IV.C-3.
---------------------------------------------------------------------------

    \51\ See 87 FR 22838 for details.

   Table IV.C-3--Lifecycle GHG Emissions Associated With Renewable Jet Fuel Produced From Canola Oil Through a
                                              Hydrotreating Process
                                       [in grams of CO2 equivalent per MJ]
----------------------------------------------------------------------------------------------------------------
 
----------------------------------------------------------------------------------------------------------------
               Emissions category                   2005 diesel
                                                     baseline              Canola oil renewable jet fuel
----------------------------------------------------------------------------------------------------------------
Domestic Agriculture............................              18                       -2.3
International Agriculture.......................  ..............                       -0.3
Feedstock Transport & Crushing..................  ..............                        6.8
Fuel Production.................................  ..............                        15.4
                                                                                        0.4
                                                                 -----------------------------------------------
Downstream & Use................................              75  ..............
Land Use Change Estimate........................  ..............            Mean             Low            High
Land Use Change (LUC)...........................  ..............            13.7             3.1            25.9
Net Emissions...................................              93            33.8            23.2              46
% GHG Reduction Relative to Baseline............  ..............             63%             75%             50%
----------------------------------------------------------------------------------------------------------------

V. Summary

    Based on our GHG lifecycle evaluation described in the NPRM, we 
find that renewable diesel, jet fuel, naphtha, LPG, and heating oil 
produced from canola oil via a hydrotreating process all meet the 50 
percent GHG reduction threshold. Based on this finding, we determine 
that renewable diesel, jet fuel, and heating oil produced from canola 
oil are eligible for BBD (D-code 4) RINs if they are produced through a 
hydrotreating process that does not co-process renewable biomass and 
petroleum, and for advanced biofuel (D-code 5) RINs if they are 
produced through a process that does co-process renewable biomass and 
petroleum. Based on this finding, we also determine that naphtha and 
LPG production from canola oil through a hydrotreating process are 
eligible for advanced biofuel (D-code 5) RINs. Based on these 
determinations, we are adding these pathways to Table 1 of 40 CFR 
80.1426.
    We are also finalizing our proposed definition of ``canola/rapeseed 
oil'' and adding this definition to 40 CFR 80.1401.

VI. Statutory & Executive Order Reviews

    Additional information about these statutes and Executive Orders 
can be found at https://www.epa.gov/laws-regulations/laws-and-executive-orders.

A. Executive Order 12866: Regulatory Planning and Review and Executive 
Order 13563: Improving Regulation and Regulatory Review

    This action is a significant regulatory action that was submitted 
to the Office of Management and Budget (OMB) for review. Any changes 
made in response

[[Page 73964]]

to OMB recommendations have been documented in the docket. The GHG 
lifecycle analysis conducted for this proposed determination, 
``Renewable Fuel Standard Program: Canola Oil Pathways to Renewable 
Diesel, Jet Fuel, Naphtha, Liquefied Petroleum Gas and Heating Oil,'' 
is available in the docket.

B. Paperwork Reduction Act (PRA)

    This action does not impose any new information collection burden 
under the PRA. OMB has previously approved the information collection 
activities contained in the existing regulations and has assigned OMB 
control number 2060-0725. This action creates new pathways by which to 
generate RINs for renewable fuels under the RFS program but creates no 
new information collection requirements for these additional pathways.

C. Regulatory Flexibility Act (RFA)

    I certify that this action does not have a significant economic 
impact on a substantial number of small entities under the RFA. In 
making this determination, EPA concludes that the impact of concern for 
this rule is any significant adverse economic impact on small entities 
and that the agency is certifying that this rule would not have a 
significant economic impact on a substantial number of small entities 
if the rule would have no net burden. This rule enables canola oil 
producers and producers of biofuels from canola oil to participate in 
the RFS program if they choose to do so to obtain economic benefits. We 
have therefore concluded that this action has no net regulatory burden 
for all directly regulated small entities.

D. Unfunded Mandates Reform Act (UMRA)

    This action does not contain an unfunded mandate of $100 million or 
more as described in UMRA, 2 U.S.C. 1531-1538, and does not 
significantly or uniquely affect small governments. The action imposes 
no enforceable duty on any state, local, or tribal governments or the 
private sector.

E. Executive Order 13132: Federalism

    This action does not have federalism implications. It does 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.

F. Executive Order 13175: Consultation and Coordination with Indian 
Tribal Governments

    This action does not have tribal implications as specified in 
Executive Order 13175. This rule affects only producers of canola oil 
and producers of biofuels made from canola oil. Thus, Executive Order 
13175 does not apply to this action.

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

    EPA interprets Executive Order 13045 as applying only to those 
regulatory actions that concern environmental health or safety risks 
that EPA has reason to believe may disproportionately affect children, 
per the definition of ``covered regulatory action'' in section 2-202 of 
the Executive order. This action is not subject to Executive Order 
13045 because it does not concern an environmental health risk or 
safety risk.

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

    This action is not a ``significant energy action'' because it is 
not likely to have a significant adverse effect on the supply, 
distribution, or use of energy. This rule enables canola oil producers 
and producers of biofuels from canola oil to participate in the RFS 
program if they choose to do so. This may create additional supplies of 
energy, potentially leading to positive impacts on the energy system. 
This rule would create no new burdens on the distribution or use of 
energy.

I. National Technology Transfer and Advancement Act (NTTAA)

    This rulemaking does not involve technical standards.

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

    EPA believes that this action is not subject to Executive Order 
12898 (59 FR 7629, February 16, 1994) because it does not establish an 
environmental health or safety standard. This rule gives renewable fuel 
producers the ability to generate credits under the RFS program for the 
production of specified biofuels from canola oil. This rule does not 
affect the level of protection provided to human health or the 
environment by applicable air quality standards. EPA recognizes that 
the RFS program as a whole may have impacts related to environmental 
justice. These potential impacts are discussed further in the RFS 
Annual Rules for 2020, 2021, and 2022, published in June 2022.\52\ 
Future actions to set biofuel volume requirements may take into 
consideration the availability of this renewable fuel pathway for the 
production of biofuel from canola oil and thus may affect GHG 
emissions, air quality, water or soil quality, or fuel and food 
prices.\53\ However, this action does not modify biofuel volume 
requirements and thus EPA believes that the final rule to approve a new 
pathway, in and of itself, will not affect human health or the 
environment.
---------------------------------------------------------------------------

    \52\ See 87 FR 39600-77 and Chapter 8, Renewable Fuel Standard 
(RFS) Program: RFS Annual Rules--Regulatory Impact Analysis, EPA-
420-R-22-008, June 2022.
    \53\ Id.
---------------------------------------------------------------------------

K. Congressional Review Act (CRA)

    This action is subject to the CRA, and the EPA will submit a rule 
report to each House of the Congress and to the Comptroller General of 
the United States. This action is not a ``major rule'' as defined by 5 
U.S.C. 804(2).

VII. Statutory Authority

    Statutory authority for this action comes from CAA sections 114, 
208, 211, and 301.

List of Subjects in 40 CFR Part 80

    Environmental protection, Administrative practice and procedure, 
Air pollution control, Diesel fuel, Fuel additives, Gasoline, Imports, 
Oil imports, Petroleum, Renewable fuel.

Michael S. Regan,
Administrator.
    For the reasons set forth in the preamble, EPA amends 40 CFR part 
80 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, 7521, 7542, 7545, and 7601(a).

Subpart M--Renewable Fuel Standard

0
2. Amend Sec.  80.1401 by adding in alphabetical order a definition for 
``Canola/Rapeseed oil'' to read as follows:

Sec.  80.1401  Definitions.

* * * * *
    Canola/Rapeseed oil means either of the following:
    (1) Canola oil is oil from the plants Brassica napus, Brassica 
rapa, Brassica juncea, Sinapis alba, or Sinapis arvensis and which 
typically contains less than

[[Page 73965]]

2 percent erucic acid in the component fatty acids obtained.
    (2) Rapeseed oil is the oil obtained from the plants Brassica 
napus, Brassica rapa, or Brassica juncea.
* * * * *

0
3. Amend Sec.  80.1426 in table 1 to Sec.  80.1426 by revising the 
entries ``G'', ``H'', and ``I'' to read as follows:

Sec.  80.1426  How are RINs generated and assigned to batches of 
renewable fuel?

* * * * *

         Table 1 to Sec.   80.1426--Applicable D Codes for Each Fuel Pathway for Use in Generating RINs
----------------------------------------------------------------------------------------------------------------
                                                                                  Production process
                                  Fuel type                Feedstock                 requirements         D-Code
----------------------------------------------------------------------------------------------------------------
 
                                                  * * * * * * *
G.........................  Biodiesel, renewable   Canola/Rapeseed oil......  One of the following:            4
                             diesel, jet fuel,                                 Transesterification
                             and heating oil.                                  using natural gas or
                                                                               biomass for process
                                                                               energy, or
                                                                               Hydrotreating; excludes
                                                                               processes that co-
                                                                               process renewable
                                                                               biomass and petroleum.
H.........................  Biodiesel, renewable   Soy bean oil; Oil from     One of the following:            5
                             diesel, jet fuel,      annual covercrops; Oil     Transesterification with
                             and heating oil.       from algae grown           or without
                                                    photosynthetically;        esterification pre-
                                                    Biogenic waste oils/fats/  treatment,
                                                    greases; Camelina sativa   Esterification, or
                                                    oil; Distillers corn       Hydrotreating; includes
                                                    oil; Distillers sorghum    only processes that co-
                                                    oil; Commingled            process renewable
                                                    distillers corn oil and    biomass and petroleum.
                                                    sorghum oil; Canola/
                                                    Rapeseed oil.
I.........................  Naphtha, LPG.........  Camelina sativa oil;       Hydrotreating............        5
                                                    Distillers sorghum oil;
                                                    Distillers corn oil;
                                                    Commingled distillers
                                                    corn oil and distillers
                                                    sorghum oil; Canola/
                                                    Rapeseed oil.
 
                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------

* * * * *
[FR Doc. 2022-26250 Filed 12-1-22; 8:45 am]
BILLING CODE 6560-50-P