Change in Minimum Oxygen Content Requirement for Reformulated
Gasoline
[Notices]
[Page 41047-41049]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr31jy97-77]
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ENVIRONMENTAL PROTECTION AGENCY
[FRL-5867-1]
Change in Minimum Oxygen Content Requirement for Reformulated
Gasoline
AGENCY: Environmental Protection Agency.
ACTION: Notice.
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SUMMARY: EPA's reformulated gasoline (RFG) program contains various
standards for RFG, including an oxygen content standard. The current
per-gallon minimum standard for oxygen content in RFG is 1.5% by
weight. Pursuant to the RFG regulations, EPA is increasing this
standard to 1.6% by weight for several of the RFG covered areas,
because those areas failed a series of compliance surveys for oxygen
content in 1996. This notice announces the increased standard, and
describes the covered areas and parties that are subject to the
increased standard. The increased standard will help ensure that all
covered areas receive the full benefit of the oxygen content
requirement in the RFG program.
FOR FURTHER INFORMATION CONTACT: Stuart Romanow, Fuels and Energy
Division, Office of Mobile Sources, Environmental Protection Agency,
Washington DC (6406J) 202-233-9296.
SUPPLEMENTARY INFORMATION:
I. Regulatory Entities
Regulatory categories and entities potentially affected by this
action include:
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Examples of affected
Category entities
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Industry.................................. Refiners, importers,
oxygenate blenders of
reformulated gasoline.
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This table is not intended to be exhaustive, but rather provides a
guide for readers regarding entities likely to be affected by this
action. This table lists the types of entities that EPA is now aware
could be potentially affected by this action. Other types of entities
not listed in the table could also be affected. To determine whether
your entity is affected by this action, you should carefully examine
the existing provisions at 40 CFR 80.41. If you have questions
regarding the applicability of this action to a particular entity,
consult the person listed in the preceding FOR FURTHER INFORMATION
CONTACT section.
II. Background
Section 211(k) of the Clean Air Act requires that EPA establish
standards for reformulated gasoline ( RFG) to be used in specified
ozone nonattainment areas (covered areas). The RFG requirements contain
performance standards for reductions of emissions from motor vehicles
of ozone forming volatile organic compounds and toxic pollutants.
Standards for RFG are contained in 40 CFR 80.41. Refiners and other
parties subject to the standards can choose to comply on either a per-
gallon basis or to comply on average. The standards for compliance on
average (``averaged standards'') are numerically more stringent than
the per-gallon standards. The averaged standards for RFG that apply in
1996 are contained in Sec. 80.41(b). These averaged standards include a
per-gallon minimum requirement of 1.5 weight percent oxygen. This per-
gallon minimum requirement is in addition to the requirement for 2.1
weight percent oxygen, on average. The average standard for oxygen must
be met by a refiner or oxygenate blender for all of the RFG it produced
at a refinery or blending facility, or for RFG imported by an importer,
but these parties are not required to meet this standard for the RFG
supplied to each covered area separately.
Any refiner, importer or oxygenate blender has the option of
meeting the RFG standards on average or per gallon. If a party is
subject to the averaged standards, then the requirement to conduct
surveys, as specified in Sec. 80.68, must be satisfied. In these
surveys, RFG samples are collected at retail gasoline stations within
covered areas and analyzed to determine if the RFG supplied to each
covered area meets certain survey pass/fail criteria specified in
Sec. 80.68. An oxygen survey series failure occurs in a covered area if
the annual average oxygen content for all of the samples is less than
2.00 weight percent. The purpose of the surveys and the tightened
standards which result if a survey is failed is to ensure that
averaging over a refiner's entire production as compared to separate
averaging for each covered area does not lead to the reduced quality of
RFG in any covered area.
Since the implementation of the RFG program in 1995, these surveys
have been conducted by the RFG Survey Association, a not-for-profit
association of refiners, importers and blenders, using an EPA-approved
survey design plan as required in the regulations. By letter dated
January 16, 1997, the RFG Survey Association reported to EPA the
results of its surveys for 1996, indicating that several survey areas
failed to meet the annual average requirements of 2.00% oxygen by
weight.\1\ After reviewing the data EPA determined that 8 areas did
fail the survey series for oxygen content.\2\
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\1\ Letter dated January 16, 1997 from Frank C. Lenski,
President, RFG Survey Association, to Charles Freed, Director, Fuels
and Energy Division, EPA.
\2\ Letter dated January 31, 1997 from Charles Freed, EPA, to
Frank Lenski, RFG Survey Association. Also see Memorandum dated
April 29, 1997 from Stuart Romanow, Mechanical Engineer, Fuels and
Energy Division to Charles Freed.
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The following covered areas failed the oxygen survey series:
1. Philadelphia-Wilmington-Trenton area [Sec. 80.70(e)]
2. Baltimore, MD area [Sec. 80.70(g)]
[[Page 41048]]
3. Houston-Galveston-Brazoria, TX area [Sec. 80.70(h)]
4. The Atlantic City, NJ area comprised of [Sec. 80.70(j)(9):]
Atlantic County
Cape May County
5. The Dallas-Fort Worth, TX area comprised of [Sec. 80.70(j)(13):]
Collin County
Dallas County
Denton County
Tarrant County
6. Norfolk-Virginia Beach-Newport News (Hampton Roads), VA area
comprised of [Sec. 80.70(j)(14):]
Chesapeake
Hampton
James City County
Newport News
Norfolk
Poquoson
Portsmouth
Suffolk
Virginia Beach
Williamsburg
York County
7. Richmond, VA area comprised of [Sec. 80.70(j)(14):]
Charles City County
Chesterfield County
Colonial Heights
Hanover County
Henrico County
Hopewell
Richmond
8. Washington D.C. area comprised of [Sec. 80.70(j)(2),(j)(6),(j)(14):]
The District of Columbia
Calvert County, MD
Charles County, MD
Frederick County, MD
Montgomery County, MD
Prince Georges County, MD
Alexandria, VA
Arlington County, VA
Fairfax, VA
Fairfax County, VA
Falls Church, VA
Loudon County, VA
Manassas, VA
Manassas Park, VA
Prince William County, VA
Stafford County, VA
The boundaries of the covered areas are described in detail in
Sec. 80.70.
Under Sec. 80.41(o), when a covered area fails an oxygen content
survey series, the minimum oxygen content requirement for that covered
area is made more stringent by increasing the per gallon minimum oxygen
content standard for affected RFG subject to the averaging standard by
0.1% . This more stringent requirement applies beginning the year
following the year of the failure. Therefore, in this case, the minimum
per gallon oxygen content requirement for the above covered areas is
increased from 1.5% to 1.6% by weight.
The criteria identifying the refineries, importers and oxygenate
blenders subject to adjusted standards are stated in Sec. 80.41(q). In
general, adjusted standards apply to RFG that is subject to an
averaging standard (``averaged RFG'') that is produced at a refinery or
oxygenate blending facility if any averaged RFG from that refinery or
facility supplied a failed covered area during 1996, or supplies the
covered area during any year that the more stringent standards are in
effect. The regulation provides for an exception based on certain
volume limits [see 40 CFR Sec. 80.41(q)(1)(iii).]
Thus, if a refiner has elected for a refinery to be subject to the
average oxygen standard, and if even a small portion of the RFG
produced at the refinery is used in an area subject to an oxygen
ratchet, the entire volume of RFG produced at the refinery is subject
to the more stringent oxygen standard regardless of which area receives
the RFG. This result is true regardless of whether the refinery's
gasoline was supplied to the city in question during 1996 or during a
year when the more stringent oxygen standard applies.
Under Sec. 80.41(q)(2), the applicability of adjusted standards to
imported averaged RFG is specified by the Petroleum Administration for
Defense District (PADD) in which the covered area is located and the
PADD where the gasoline is imported. The covered areas that had oxygen
survey series failures are located in PADDs I and III. Therefore, all
RFG imported at facilities located in PADDs I, II, III or IV is subject
to the adjusted oxygen standard. The states included in each PADD are
identified in Sec. 80.41(r). In addition, if any RFG imported into any
other PADD supplies any of the covered areas with oxygen survey
failures, the adjusted standard applies to that RFG, as well.
Under Sec. 80.41(q)(3), any gasoline that is transported in a
fungible manner by a pipeline, barge or vessel is considered to have
supplied each covered area that is supplied with any gasoline by that
pipeline, barge or vessel shipment unless the refiner or importer is
able to establish that the gasoline it produced or imported was
supplied only to a smaller number of covered areas.
Consider, for example, gasoline transported on the Colonial
Pipeline, which supplies RFG to several cities that failed the oxygen
survey in 1996. If a refinery's RFG was transported by the Colonial
Pipeline any time during 1996, or any time during any year when the
more stringent oxygen standard applies, the more stringent oxygen
standard applies to all RFG produced at the refinery regardless of the
market. In addition, there is a presumption that, due to fungible
mixing, each refinery's RFG that is transported by the Colonial
Pipeline is in part supplied to each city supplied by the Colonial
Pipeline. This presumption is rebuttable, but the rebuttal normally
would require a refiner to have transported its RFG in a non-fungible
manner. Thus, the more stringent standard applies to a refinery whose
gasoline is transported on the Colonial Pipeline regardless of whether
the refiner takes delivery of RFG in the specific cities that failed
the oxygen survey.
The adjusted oxygen standard applies to all averaged RFG produced
by a refinery or imported by an importer identified in Sec. 80.41(q).
In accordance with Sec. 80.41(p), the effective date of this change is
October 29, 1997.
Thus, under Sec. 80.41(p) the more stringent oxygen standard
applies at all points of the distribution system beginning on October
29, 1997, including terminals supplying the affected covered areas and
retail outlets in the covered areas. If a downstream facility fails to
meet the new standard by October 29, 1997, the party who operates the
facility would be in violation, as well as each upstream party who
supplied that facility. An upstream party who failed to supply RFG
meeting the new oxygen standard sufficiently in advance of October 29,
1997 will have caused the violation.
As a result, EPA believes that refiners, importers and oxygenate
blenders must begin producing or importing RFG meeting the new oxygen
standard sufficiently in advance of October 29, 1997 to ensure all
downstream parties have time to transition storage tanks to meet the
new standard.
However, EPA believes it may be difficult for all regulated parties
to transition to the new oxygen standard by October 29, 1997. As a
result, EPA intends to enforce the new oxygen standard in a manner that
gives parties additional time. Refiners, importers, and oxygenate
blenders will be required to meet the new oxygen standard beginning
September 29, 1997. EPA believes this revised date for refinery-level
compliance reflects a later date than would be necessary if all parties
had to comply by October 29, 1997. In the case of parties other than
refiners, importers, oxygenate blenders, retailers and wholesale
purchaser-consumers, (e.g., pipelines and terminals supplying gasoline
to affected covered areas) EPA will enforce the new oxygen standard
[[Page 41049]]
beginning November 28, 19973. In the case of retail outlets
and wholesale purchaser-consumer facilities located in the affected
covered areas EPA will enforce the new oxygen standard beginning
December 29, 1997. EPA intends to initiate a rulemaking to revise
Sec. 80.41(p) to reflect the need for additional downstream transition
time when a standard is changed.
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\3\ This supersedes the downstream enforcement timing discussed
in ``RFG/Anti-Dumping Questions and Answers, November 12, 1996''.
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Mary D. Nichols,
Assistant Administrator for Air and Radiation.
Sylvia K. Lowrance,
Assistant Administrator for Enforcement and Compliance Assurance.
[FR Doc. 97-20220 Filed 7-30-97; 8:45 am]
BILLING CODE 6560-50-P
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