Control of Emissions of Air Pollution From Nonroad Diesel Engines
and Fuel [pp. 39157-39206]
[Federal Register: June 29, 2004 (Volume 69, Number 124)]
[Rules and Regulations]
[Page 39157-39206]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr29jn04-25]
[[pp. 39157-39206]]
Control of Emissions of Air Pollution From Nonroad
Diesel Engines and Fuel
[[Continued from page 39156]]
[[Page 39157]]
refiners such as itself, who grew by normal business practice, being
disqualified as small refiners. The refiner suggested that we clarify
the language and include provisions for continuance of small refiner
flexibility for refiners who qualified under the Highway Diesel Sulfur
rule (and have not been disqualified as the result of a merger or
acquisition).
iii. Comments on the Baseline Approach
A coalition of small refiners provided comments on a few aspects of
concern. The small refiners believe that the fuel segregation, and
ensuing marking and dying, provisions are quite complex. One small
refiner believes that mandating a minimum volume of NRLM production
would conflict with the purpose of maintaining adequate on-highway
volumes of 15 ppm sulfur fuel and unnecessarily restricts small
refiners, and offered suggestions in their comments on how to improve
the language. In addition, the small refiner believes that mandating a
minimum volume of NRLM production would conflict with the purpose of
maintaining adequate on-highway volumes of 15 ppm sulfur fuel and
unnecessarily restricts small refiners, and offered suggestions in
their comments on how to improve the language.
iv. Comments on Small Refiner ``Option 4''
A coalition of small refiners commented that if the final rule is
not issued before January 1, 2004, a provision should be made to
accommodate those small refiners planning to take advantage of the
proposed small refiner ``Option 4'' (the NRLM/Gasoline Compliance
option). A small refiner echoed the concerns of the small refiner
coalition, commenting that delayed finalization of the final rule would
undermine the benefits of small refiner flexibility Option 4. The small
refiner is concerned that a delay in issuing the rule, and subsequent
delay in the opportunity to apply the interim gasoline flexibility,
would negate its opportunity to take full advantage of the credits the
refiner now has, as it would not be able to comply with the 300 ppm
cap. The small refiner suggested that we allow small refiners to apply
for temporary relief and operate under the Option 4 provision. Another
small refiner commented that, in the NPRM, it was unclear if a small
refiner could elect to use any or all of the first three of the small
refiner provisions if it did not elect to use Option 4. Further, the
refiner understood that if Option 4 was chosen, a small refiner could
not use any of the first three options. The refiner believes that it is
important that a small refiner be able to use Options 1, 2, and 3 in
combination with each other, and stated that we need to clarify the
intent in the final rule. The small refiner also commented that the
provisions in 40 CFR 80.553 and 80.554 are not clear and should be
revised to clarify their intent. Specifically, the refiner questioned
whether or not a small refiner who committed to producing ULSD by June
1, 2006 in exchange for an extension of its interim gasoline sulfur
standards (under 40 CFR 80.553) could elect to exercise the options
allowed under 40 CFR 80.554.
A small refiner raised the concern that the small refiner Option 4
only provides an adjustment to those small refiners whose small refiner
gasoline sulfur standards were established through the hardship process
of 40 CFR 80.240. The small refiner suggested that we finalize a
compliance option that allows a 20 percent increase in small refiner
gasoline sulfur standards be extended to all small refiners, not just
those with standards established pursuant to 40 CFR 80.240(a), and
offers suggested language in its comments.
v. Comments on Emission Impacts of the Small Refiner Provisions
A state environmental group commented that the provisions for small
refiners raise substantial environmental concerns. The group is
concerned that these provisions will allow small refiners the ability
to produce gasoline with an unknown sulfur content for an unknown
length of time; this fuel may then be sold at the refiner's retail
outlet, and may become the primary fuel for some vehicles, which alters
vehicle fleet emissions performance. This environmental group also
commented that the absence of any process of notification regarding
small business provisions to notify States of these provisions is
troubling. The concern is that these deviations from fuel content that
affects fuels consumed in states that use emissions inventories for air
quality planning purposes, and can significantly alter inventories. The
group suggested that in the future there should be greater
communication from us regarding decisions that impact the quality of
fuels consumed in a state, and thus impact the quality of that state's air.
Another state environmental group commented on the flexibility
provisions for small refiners; the group is concerned that the
exemption will not have a minor effect on the nation's fuel supply, as
the state is an intermountain western state. The group comments that
the impact of this exemption is concentrated in these states, namely
Washington and Oregon--states which are served primarily by refineries
that will be allowed to delay compliance with the ULSD standards until
2014. Therefore, the group commented, residents of these areas are
denied air quality benefits equivalent to those promised the rest of
the country. Those seeking to purchase and use equipment in these areas
will be subject to the ULSD standard regardless of fuel supply and
availability in their area, would be faced with misfueling, deferring
purchase of new equipment, or paying a premium for a ``boutique'' fuel.
vi. Comments on Inclusion of a Crude Capacity Limit for Small Refiners
and Leadtime Afforded for Mergers and Acquisitions
A non-small refiner supported the inclusion of the 155,000 bpcd
limit, but suggested that we limit the provision of affording a two-
year leadtime to small refiners who lose their small status due to
merger or acquisition to the case where a small refiner merges with
another small refiner. Further, the refiner commented that it would be
inappropriate to allow such small refiners to be able to generate
credits for ``early'' production of lower sulfur diesels during this
two-year leadtime. Lastly, the refiner commented that a small refiner
which acquires a non-small refiner, and thus loses its small refiner
status, should not be eligible for hardship provisions. Another
commenter stated that if we were to finalize the 155,000 bpcd limit, we
should not apply it in cases of a merger between two small refiners.
The commenter further stated that a merger of two small companies in a
hardship condition does not imply improved financial health in the same
way that an acquisition would. Another non-small refiner commented that
it supports the two-year lead time for refineries that lose their
status as a small refiner; the refiner believes that any refiner with
the financial wherewithal to acquire additional refineries to allow its
crude capacity to exceed 155,000 bpcd should not be able to retain
status as a small refiner.
vii. Necessity of Small Refiner Program
A non-small refiner provided comment on the NPRM stating the belief
that the proposed provisions for small refiners are not practical. The
refiner is concerned that having provisions for small refiners adds a
level of complication, results in emissions losses, increases the
potential for ULSD contamination, and create an unfair situation in the
marketplace. Similarly,
[[Page 39158]]
another non-small refiner and a trade group representing many refiners
and others in the fuels industry commented that they oppose the
extension of compliance deadlines for small refiners, as this can
result in inequitable situations that may affect the refining industry
for some time and can put the distribution system at risk for
contamination of lower sulfur fuels. They further stated that all
refiners will face challenges in complying with the upcoming standards
and would not significantly alter the business decisions that small
refiners would make. They also stated that non-small refiners face
similar issues with their older and/or smaller refineries, but will not
have the benefit of being able to postpone making these decisions as
small refiners will.
viii. Comments on Fuel Marker
We received comments from terminal operators stating that the
proposed heating oil marker requirements would force small terminal
operators to install expensive injection equipment and that they would
not be able to recoup the costs.
3. Types and Number of Small Entities
The small entities directly regulated by this final rule are
nonroad diesel engine and equipment manufacturers, nonroad diesel fuel
refiners, and nonroad diesel fuel distributors and marketers. These
categories are described in more detail below, and the definitions of
small entities in those categories are listed in table X.C-1 above.
a. Nonroad Diesel Engine Manufacturers
Before beginning the SBREFA process, EPA conducted an industry
profile for the nonroad diesel sector. We have not received any new
information since that time and we continue to believe that this is a
valid characterization of the industry. Using information from the
industry profile, EPA identified a total of 61 engine manufacturers.
The top 10 engine manufacturers comprise 80 percent of the total
market, while the other 51 companies make up the remaining 20 percent.
\252\ Of the 61 manufacturers, four fit the SBA definition of a small
entity. These four manufacturers were Anadolu Motors, Farymann Diesel
GMBH, Lister-Petter Group, and V & L Tools (parent company of Wisconsin
Motors LLC, formerly ``Wis-Con Total Power''). These businesses
comprised eight percent of the total nonroad engine sales for the year
2000.
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\252\ All sales information used for this analysis was 2000
data.
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b. Nonroad Diesel Equipment Manufacturers
We also used the industry profile to determine the number of
nonroad small business equipment manufacturers. EPA identified over 700
manufacturers with sales and/or employment data that could be included
in the screening analysis. These businesses included manufacturers in
the construction, agricultural, mining, and outdoor power equipment
(mainly, lawn and garden equipment) sectors of the nonroad diesel
market. The equipment produced by these manufacturers ranged from small
walk-behind equipment (sub-25 hp engines) to large mining and
construction equipment (using engines in excess of 750 hp). Of the
manufacturers with available sales and employment data (approximately
500 manufacturers), nonroad small business equipment manufacturers
represent 68 percent of total nonroad equipment manufacturers (and
these manufacturers accounted for 11 percent of nonroad diesel
equipment industry sales in 2000).
c. Nonroad Diesel Fuel Refiners
Our current assessment is that 26 refiners (collectively owning 33
refineries) meet SBA's definition of a small business for the refining
industry. The 33 refineries appear to meet both the employee number and
production volume criteria mentioned above. These small refiners
currently produce approximately 6 percent of the total high-sulfur
diesel fuel. It should be noted that because of the dynamics in the
refining industry (e.g., mergers and acquisitions), the actual number
of refiners that ultimately qualify for small refiner status under the
nonroad diesel sulfur program could be different than this assessment.
d. Nonroad Diesel Fuel Distributors and Marketers
The industry that transports, distributes, and markets nonroad
diesel fuel encompasses a wide range of businesses, including bulk
terminals, bulk plants, fuel oil dealers, and diesel fuel trucking
operations, and totals thousands of entities that have some role in
this activity. Over 90 percent of these entities meet small entity
criteria. Common carrier pipeline companies are also a part of the
distribution system; 10 of them are small businesses.
4. Reporting, Recordkeeping and Other Compliance Requirements
This section describes the expected burden of the compliance
requirements (for all manufacturers and refiners) for the standards
being finalized in today's action.
a. Nonroad Diesel Engine and Equipment Manufacturers
For engine and equipment standards, we must have the assurance that
engines and/or equipment produced by manufacturers meet the applicable
standard, and will continue to meet this standard as the equipment
passes through to the ultimate end user. We are continuing many of the
reporting, recordkeeping, and compliance requirements prescribed for
nonroad engines and equipment, as set out in 40 CFR part 89. These
include, certification requirements and reporting of production,
emissions information, use of transition provisions, etc. The types of
professional skills required to prepare reports and records are also
similar to the types of skills that were needed to meet the regulatory
requirements set out in 40 CFR part 89. Key differences in the
requirements of today's rule as related to 40 CFR part 89 are the
additional testing and defect reporting. We are finalizing an increase
in the number of data points (i.e., transient testing) that will be
required for reporting emissions information. Also, as proposed, we are
requiring additional defect reporting for Tier 4 and later engines. We
are requiring that manufacturers report to us if they learn that a
substantial number of their engines have emission-related defects. This
is generally not a requirement to collect information; however if
manufacturers learn that there are or might be a substantial number of
emission-related defects, then they must send us information describing
the defects.
b. Nonroad Diesel Fuel Refiners, Distributors, and Marketers
For any fuel control program, we must have the assurance that fuel
produced by refiners meets the applicable standard, and that the fuel
continues to meet this standard as it passes downstream through the
distribution system to the ultimate end user. This is particularly
important in the case of diesel fuel, where the aftertreatment
technologies expected to be used to meet the engine standards are
highly sensitive to sulfur. Many of the recordkeeping, reporting and
compliance provisions of the today's action are fairly consistent with
those in place today for other fuel programs,
[[Page 39159]]
including the current 15 ppm highway diesel regulation. For example,
recordkeeping involves the use of product transfer documents, which are
already required under the 15 ppm highway diesel sulfur rule (40 CFR
80.560). Under today's final rule we are adding additional
recordkeeping and reporting requirements for refiners, importers, and
fuel distributors to implement the designate and track provisions.
However, interactions with parties from all segments of the
distribution system indicated that the records necessary were analogous
to records already kept as a normal process of doing business.
Consequently, the only significant additional burden would be
associated with the reporting requirement.
General requirements for reporting for refiners and importers
include: registration (only in the case where a refiner or importer is
not registered under a previous fuel program), pre-compliance reports
(on a refiner or importer's progress towards meeting the nonroad diesel
fuel requirements as specified in this rule), quarterly designation
reports, and annual reports. All parties from the refiner to the
terminal will be required to report volumes of designated fuels
received and distributed, as well as compliance with quarterly and
annual limits. All parties in the distribution system are required to
keep product transfer documents (PTDs), though refiners and importers
are required to initially generate and provide information on
commercial PTDs that identify the diesel fuel with meeting specific
needs (i.e., 15 ppm highway diesel, 500 ppm highway diesel, etc.).
Also, refiners in Alaska and small refiner/credit fuel users must
report end users of their fuel. These end users must also keep records
of these fuel purchases. Lastly, small refiners are required to apply
for small refiner status and small refiner baselines.
In general, we are requiring that all records be kept for at least
five years. This recordkeeping requirement should impose little
additional burden, as five years is the applicable statute of
limitations for current fuel programs.
See section X.B, above, for a discussion of the estimated burden
hours and costs of the recordkeeping and reporting that will be
required by this final rule. Detailed information on the reporting and
recordkeeping measures associated with this rulemaking are described in
the Information Collection Requests (ICRs) for this rulemaking--1897.05
for nonroad diesel engines, and 1718.05 for fuel-related items.
5. Regulatory Alternatives To Minimize Impact on Small Entities
Below we discuss the Panel recommendations, EPA proposals, and
final regulatory alternatives to minimize the rule's impact on small
entities. More detailed information on the provisions for these
entities can be found in sections III.C and IV.B of this preamble (for
small business engine and equipment manufacturers and small entities
throughout the fuel distribution system, respectively).
a. Panel Recommendations
During the SBREFA process, the Panel recommended transition
flexibilities that we considered during the development of the NPRM.
The Panel recommended provisions for both the one-step and two-step
options. Since we are finalizing a two-step approach, only the
recommendations for this approach are being discussed here. (A complete
discussion of all of the Panel recommendations and our proposals for
small entities is located in section X.C. of the NPRM.)
Following the SBREFA process, the Panel (or some Panel members),
recommended the following transition flexibilities and hardship
provisions to help mitigate the impacts of the rulemaking on small
entities. We proposed and requested comment on these recommendations in
the NPRM.
i. Panel Recommendations for Small Business Engine Manufacturers
For nonroad diesel small business engine manufacturers, we proposed
the following provisions:
? A manufacturer must have certified in model year 2002 or
earlier and would be limited to 2500 units per year to be eligible for
all provisions set out below;
? For PM--
--Small engine manufacturers could delay compliance with the standards
for up to three years for engines under 25 hp, and those between 75 and
175 hp (as these engines only have one standard)
--small engine manufacturers have the option to delay compliance for
one year if interim standards are met for engines between 50 and 75 hp
(for this power category we are treating the PM standard as a two phase
standard with the stipulation that small manufacturers cannot use PM
credits to meet the interim standard; also, if a small manufacturer
elects the optional approach to the standard (elects to skip the
interim standard), no further relief will be provided)
? for NOX \253\
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\253\ There is no change in the NOX standard for
engines under 25 hp and those between 50 and 75 hp. For these two
power bands EPA proposed no special provisions.
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--A three year delay in the program for engines in the 25-50 hp and the
75-175 hp categories, consistent with the one-phase approach
recommendation above;
? A small engine manufacturer could be afforded up to two
years of hardship (in addition to the transition flexibilities) upon
demonstrating to EPA a significant hardship situation;
? Small engine manufacturers would be able to participate in
an averaging, banking, and trading (ABT) program (which we proposed as
part of the overall rulemaking program for all manufacturers);
? Engines under 25 hp would not be subject to standards
based on use of advanced aftertreatment; and,
? No NOX aftertreatment-based standards for
engines 75 hp and under.
ii. Panel Recommendations for Small Business Equipment Manufacturers
We proposed the following provisions for nonroad diesel small
business equipment manufacturers:
? Small business nonroad diesel equipment manufacturers must
have reported equipment sales using certified engines in model year
2002 or earlier to be eligible for all provisions;
? Essential continuance of the transition flexibilities
offered for the Tier 1 and Tier 2 nonroad diesel emission standards (40
CFR 89.102), which are available to all nonroad diesel equipment
manufacturers
--`Percent-of-production allowance'--over seven model-year period
manufacturers may install engines not certified to the new emission
standards in an amount of equipment equivalent to 80 percent of one
year's production, implemented by power category with the average
determined over the period in which the flexibility is used (this
proposal would afford additional flexibility over the comparable
flexibility in Tier 2/3, however, because of the smaller number of
horsepower categories in the Tier 4 rule)
--`Small volume allowance'--a manufacturer may exceed the 80 percent
allowance in seven years as described above, provided that the previous
Tier engine use does not exceed 700 total over seven years, and 200 in
any given year, limited to one family per power category;
alternatively, at the manufacturer's choice by horsepower category, a
[[Page 39160]]
program that eliminates the ``single family provision'' restriction
with revised total and annual sales limits as shown below:
< =175 hp: 525 previous Tier engines (over 7 years) with an annual cap
of 150 units (separate for each hp category)
>175 hp: 350 previous Tier engines (over 7 years) with an annual cap of
100 units (separate for each hp category);
? Small business equipment manufacturers would be allowed to
borrow from the Tier 3/Tier 4 flexibilities for use in the Tier 2/Tier
3 time frame; and,
? Small business equipment manufacturers could be afforded
up to two years of hardship after other transition allowances are
exhausted, similar to that offered small business engine manufacturers.
In addition, we proposed the Panel's recommendation that the
provisions for small equipment manufacturers be extended to all
equipment manufacturers, regardless of size. We also sought comment on
the total number of engines and annual cap values proposed and on
implementing the small volume allowance provision without a limit on
the number of engine families.
iii. Panel Recommendations for Small Refiners, Distributors, and Marketers
The following provisions were proposed for nonroad diesel small
refiners:
? Small refiners would be required to use 500 ppm sulfur
fuel beginning June 1, 2010 and 15 ppm fuel beginning June 1, 2014;
? Small refiners may choose one of the following transition
provisions, which serve to encourage early compliance with the diesel
fuel sulfur standards:
--Credits for Early Desulfurization: would allow small refiners to
generate and sell credits for nonroad diesel fuel that meets the small
refiner standards earlier than required in the regulation; or,
--Limited Relief on Small Refiner Interim Gasoline Sulfur Standards: a
small refiner producing its entire nonroad diesel fuel pool at 15 ppm
sulfur by June 1, 2006, and who chooses not to generate nonroad credits
for early compliance, would receive a 20 percent relaxation in its
assigned small refiner interim gasoline sulfur standards (with the
maximum per-gallon sulfur cap for any small refiner remaining at 450
ppm); and,
? A small refiner would be afforded hardship similar to the
provisions established under 40 CFR 80.270 and 80.560 (the gasoline
sulfur and highway diesel fuel sulfur programs, respectively), case-by-
case approval of hardship applications must be sought based on
demonstration of extreme hardship circumstances.
We did not propose specific provisions for nonroad diesel fuel
distributors and marketers in the NPRM. During the SBREFA process,
distributors commented that they would support a one-step approach to
eliminate the possibility of having multiple grades of fuel in the
distribution system and the Panel recommended that we further study
this issue during the development of the rule.
iv. Additional Panel Recommendations
Some, but not all, Panel members recommended that the following
provisions be included in the NPRM; we requested comment on these items
but did not propose them:
? The inclusion of a technological review of the standards
in the 2008 time frame
? No PM aftertreatment-based standards for engines between 25 and 75 hp
b. Discussion of Items Being Finalized in Today's Action
i. Provisions for Small Business Engine Manufacturers
For nonroad diesel small business engine manufacturers, we are
finalizing many of the provisions set out above with some significant
revisions, as described below. We are finalizing all of the hardship
provisions that we proposed. We believe these provisions are an element
of providing appropriate lead time for this class of engines.
For engines under 25 hp:
? PM--a manufacturer may elect to delay compliance with the
standard for up to three years.
? NOX--there is no change in the existing
NOX standard for engines in this category, so no special
provisions are being provided.
For engines in the 25 to 50 hp category:
? PM--manufacturers must comply with the interim standards
(the Tier 4 requirements that begin in model year 2008) on time, and
may elect to delay compliance with the 2013 Tier 4 requirements (0.02
g/bhp-hr PM standard) for up to three years.
? NOX--a manufacturer may elect to delay
compliance with the standard for up to three years.
For engines in the 50 to 75 hp category:
? PM--A small business engine manufacturer may delay
compliance with the 2013 Tier 4 requirement of 0.02 g/bhp-hr PM for up
to three years provided that it complies with the interim Tier 4
requirements that begin in model year 2008 on time, without the use of
credits (as manufacturers of engines in this category still have the
option to comply with the Tier 3 standard). Alternatively, a
manufacturer may elect to skip the interim standard completely.
Manufacturers choosing this option will receive only one additional
year for compliance with the 0.02 g/bhp-hr standard (i.e. compliance in
2013, rather than 2012).
? NOX--there is no change in the NOX
standard for engines in this category, therefore no special provisions
are being provided.
For engines in the 75 to 175 hp category:
? PM--a manufacturer may elect to delay compliance with the
standard for up to three years.
? NOX--a manufacturer may elect to delay
compliance with the standard for up to three years.
In regard to the Office of Advocacy's concern regarding the
technical feasibility of PM and NOX aftertreatment devices,
as proposed in the NPRM, we are not adopting standards based on
performance of NOX aftertreatment technologies for engines
under 75 hp. We believe the factual record--as documented in the RIA,
the Summary and Analysis of Comments, and this preamble--does not
support the claim that the PM standards will not be technically
feasible in 2013 for the 25-75 hp engines. As set out at length in
section 4.1.3 of the RIA, among other places, performance of PM traps
is not dependent on engine size.
We disagree with the statement made by the Office of Advocacy that,
based on available information, we do not have a sufficient basis for
engines between 25 and 75 hp to be subject to PM standards based on use
of advanced aftertreatment. As we have documented earlier and in the
RIA, we believe that such standards are feasible for these engines at
reasonable cost,\254\ and will help to improve very important air
quality problems, especially by reducing exposure to diesel PM and by
aiding in attainment of the PM 2.5 National
[[Page 39161]]
Ambient Air Quality Standard. See generally, comment response 8.2.3 of
the Summary and Analysis of Comments, and sections 12.6.2.2.9 and
12.6.2.2.10 of chapter 12 of the Draft RIA. These standards will also
result in significant reductions of NMHC, which includes many
carcinogenic air toxics. Indeed, given these facts, we are skeptical
that an alternative of no aftertreatment-based PM standards for these
engines would be appropriate under section 213(a)(4) of the Clean Air
Act (see section VII.A above, where we found that ``[w]e * * * do not
see a basis in law or policy to adopt either of these options''). We
believe that the transition and hardship provisions being finalized for
small business engine manufacturers in today's action are reasonable
and are a factor in our ultimate finding that the PM standards for
engines in the 25-75 hp range are appropriate.
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\254\ As the cost issues raised in SBA's comments relate to all
manufactures (not just small business manufacturers), further
information on the costs of this technology as well as the benefits
analysis, can be found in section VI of this preamble (and also
chapters 6 and 9, respectively, of the Regulatory Impact Analysis).
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ii. Provisions for Small Business Equipment Manufacturers
The transition and hardship provisions that were proposed for small
business nonroad equipment manufacturers are being finalized today,
with some modifications.
Adopting an alternative on which we solicited comment, the final
rule allows all equipment manufacturers the opportunity to choose
between two options: (a) Manufacturers would be allowed to exempt 700
pieces of equipment over seven years, with one engine family; or (b)
manufacturers using the small-volume allowance could exempt 525
machines over seven years (with a maximum of 150 in any given year) for
each of the three power categories below 175 horsepower, and 350
machines over seven years (with a maximum of 100 in any given year) for
the two power categories above 175 horsepower. Concurrent with the
revised caps, manufacturers could exempt engines from more than one
engine family under the small-volume allowance program. Based on sales
information for small businesses, we estimated that the alternative
small-volume allowance program to include lower caps and allow
manufacturers to exempt more than one engine family would keep the
total number of engines eligible for the allowance at roughly the same
overall level as the 700-unit program. We believe that these provisions
will afford small manufacturers the type of transition leeway
recommended by the Panel. Further, these transition provisions could
allow small business equipment manufacturers to postpone any redesign
needed on low sales volume or difficult equipment packages, thus saving
both money and strain on limited engineering staffs. Within limits,
small business equipment manufacturers would be able to continue to use
their current engine/equipment configuration and avoid out-of-cycle
equipment redesign until the allowances are exhausted or the time limit
passes.
We are not finalizing the requirement that small equipment
manufacturers and importers have reported equipment sales using
certified engines in model year 2002 or earlier. Please see section
III.C.2.a.ii above for a detailed discussion on our decision to
eliminate this requirement from today's rule.
We are also finalizing three additional provisions today. Two of
these provisions are being finalized for all equipment manufacturers,
and therefore small business equipment manufacturers may also take
advantage of them. These are the Technical Hardship Provision and the
Early Tier 4 Engine Incentive Program, and are discussed in greater
detail in sections III.B.2.b and e above. The third provision is being
finalized for small business equipment manufacturers only, for the 20-
50 hp category. This provision is discussed in greater detail in
section III.C.2.b.ii above.
iii. Provisions for Small Refiners
As previously discussed, we are finalizing standards for locomotive
and marine diesel fuel today. Below are the regulatory transition and
hardship provisions that we are finalizing to minimize the degree of
hardship imposed upon small refiners by this program. With these
provisions we are confident about going forward with the 500 ppm sulfur
standard for NRLM diesel fuel in 2007, and the 15 ppm sulfur standard
for nonroad diesel fuel in 2010 and locomotive and marine diesel fuel
in 2012, for the rest of the industry. Given the small refiner relief
provisions that are being finalized today, small refiners will be the
only refiners permitted to continue selling 500 ppm fuel to nonroad,
locomotive, and marine markets from 2010 until 2014 without the use of
credits.
We are finalizing delayed compliance for small refiners today
(``NRLM Delay'' option). We are confident with going forward with these
sulfur standards given the regulatory transition provisions being
offered for small refiners. These delayed standards would allow for the
continued production of higher sulfur NRLM fuel until June 1, 2010, and
similarly, for the production of 500 ppm NRLM fuel until June 1,
2014.\255\ This is identical to the relief proposed in the NPRM (which
small refiners considered sufficient and supported) with the exception
that it applies not only to nonroad fuel, but also to locomotive and
marine fuel given the decision to finalize 15 ppm sulfur standards for
locomotive and marine diesel fuel. Table X.C-2 below illustrates the
delayed standards in relation to the general program. This delay option
is not being finalized for the Northeast and mid-Atlantic areas due to
the removal of the heating oil marker in these areas. However this is
not expected to impact small refiners, and this will provide
significant relief for small terminal operators. Further, this
provision will be finalized in Alaska only if a refiner gets an
approved compliance plan for segregating their fuel to the end user.
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\255\ Since new engines with sulfur sensitive emission controls
will begin to become widespread during this time, small refiner fuel
will need to be segregated and only supplied for use in pre-2011
nonroad equipment or in locomotives or marine engines.
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We also are finalizing transition provisions to encourage early
compliance with the standards being finalized today. These provisions are:
? The NRLM credit option--Some small refiners have indicated
that they might need to produce fuel meeting the NRLM diesel fuel
sulfur standards earlier than required under the small refiner program
described above (distribution systems might limit the number of grades
of diesel fuel that will be carried, it may be economically
advantageous to make compliant NRLM diesel fuel earlier to prevent
losing market share, etc.) This option allows small refiners to
participate in the NRLM diesel fuel sulfur credit banking and trading
program discussed in section IV. Generating and selling credits could
provide small refiners with funds to help defray the costs of early
NRLM compliance.
? The NRLM/Gasoline Compliance Option--This option is
available to small refiners that produce greater than 95 percent of
their NRLM diesel fuel at the 15 ppm sulfur standard by June 1, 2006
and elect not to use the provision described above to earn NRLM diesel
fuel sulfur credits for this early compliance.\256\ For small refiners
[[Page 39162]]
choosing this option the applicable small refiner annual average and
per-gallon cap gasoline sulfur standards will be increased by 20
percent for the duration of the interim program; however, in no case
may the per-gallon gasoline sulfur cap exceed 450 ppm.
---------------------------------------------------------------------------
\256\ This is down from the 100 percent requirement proposed to
allow for some contamination losses in the process of delivering
fuel from the refinery. As discussed earlier in this section,
production volumes in the final rule are based upon actual delivered
volumes. The 5 percent allowance for greater than 15 ppm fuel should
provide adequate flexibility for any refiner's contamination issues,
while not providing any opportunity to significantly alter their
compliance plans.
---------------------------------------------------------------------------
A small refiner may choose to use the relaxed standards (the NRLM
Delay option), the NRLM Credit option, or both in combination. Thus any
fuel that it produces from crude at or below the sulfur standards
earlier than required will qualify for generating credits. However, the
NRLM/Gasoline Compliance option may not be used in combination with
either the NRLM Delay option or the NRLM Credit option, since a small
refiner must produce at least 85 percent of its NRLM diesel fuel at the
15 ppm sulfur standard under the NRLM/Gasoline Compliance option.
Small refiners that choose to make use of the delayed nonroad
diesel sulfur requirements would also delay to some extent the emission
reductions that would otherwise have been achieved. However, the
overall impact of these postponed emission reductions would be small in
comparison to the overall program benefits, as small refiners represent
only a fraction of national non-highway diesel production. Further, we
are aware of some small refiners that plan to take advantage of one of
the flexibility provisions that encourages early compliance with the
standards. Absent specific provisions for small refiners, we would have
to consider delaying the overall program until the burden of the
program on many small refiners was diminished, which would delay the
air quality benefits of the overall program. By providing temporary
relief to small refiners, we are able to adopt a program that
expeditiously reduces NRLM diesel fuel sulfur levels in a feasible
manner for the industry as a whole.
Table X.C-2.--Sulfur Standards for the Nonroad Diesel Fuel Small Refiner Program
(in parts per million (ppm)) \a\
--------------------------------------------------------------------------------------------------------------------
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015+
--------------------------------------------------------------------------------------------------------------------
Non-Small--NR.............. ....... 500 500 500 15 15 15 15 15 15
Non-Small--LM.............. ....... 500 500 500 500 500 15 15 15 15
Small--all fuel............ ....... ....... ....... ....... 500 500 500 500 15 15
--------------------------------------------------------------------------------------------------------------------
Notes: \a\ New standards are assumed to take effect June 1 of the applicable year.
iv. Provisions for Small Distributors and Fuel Marketers
Though we did not propose any specific regulatory relief for small
distributors and marketers of nonroad fuel, we are finalizing
provisions to avoid the negative impact to small terminal operators
raised in the public comments on our NPRM (that heating oil marker
requirements would force small terminal operators to install expensive
injection equipment and that they would not be able to recoup the
costs). To mitigate the burden on these operators, terminals in much of
PADD 1 will not have to add the fuel marker to home heating oil. No
small refiner or credit fuel could be sold in this exclusion area. The
exclusion area covers the vast majority of heating oil that will be
marketed. Further, very little fuel above 500 ppm will be marketed
outside of the exclusion area except directly from the refinery gate.
Therefore, we expect that few terminals outside of the exclusion area
would need to put in injection equipment.
6. Conclusion
A cost-to-sales ratio test, a ratio of the estimated annualized
compliance costs to the value of sales per company, was performed for
these entities during the proposal stage of the rulemaking. \257\ From
this cost-to-sales test, we found that approximately four percent (13
companies) of small entities in the engine and equipment manufacturing
industry would be affected by between one and three percent of sales
(i.e., the estimated costs of compliance with the rule would be greater
than one percent, but less than three percent, of their sales). One
percent (four companies) of small entities would be affected by greater
than three percent. In all, 17 of the 518 potentially affected small
engine and equipment manufacturers are estimated to have compliance
costs that could exceed one percent of their sales. (A complete
discussion of the costs to engine and equipment manufacturers as a
result of this final rule is located in Chapter 6 of the Final
Regulatory Impact Analysis.)
---------------------------------------------------------------------------
\257\ The cost-to-sales ratio test assumes that control costs
are completely absorbed by each entity and does not account for or
consider interaction between manufacturers/producers and consumers
in a market context.
---------------------------------------------------------------------------
Based on our outreach, fact-finding, and analysis of the potential
impacts of our regulations on small businesses, it was determined that
small refiners in general would likely experience a significant and
disproportionate financial hardship in reaching the objectives of the
nonroad diesel fuel sulfur program. One indication of this
disproportionate hardship for small refiners is the relatively high
cost per gallon projected for producing nonroad diesel fuel under the
proposed program. Refinery modeling (of all refineries), indicates
significantly higher refining costs for small refiners. Specifically,
without special provisions, refining costs (for full compliance with
the 15 ppm sulfur standards) for small refiners on average would be
about 7 cents per gallon compared to about 5.7 cents per gallon for
non-small refiners. (A complete discussion of the fuel-related costs as
a result of this final rule is located in Chapter 7 of the Final
Regulatory Impact Analysis.) However, we believe that the regulatory
transition provisions that we are affording to small entities will
significantly minimize this impact on these entities.
In addition, as contemplated by section 212 of SBREFA, EPA is also
preparing a compliance guide to help small entities comply with this
rule. This guide will be available within 60 days of the effective
publication date of this rulemaking, and will be available on the
Office of Transportation and Air Quality Web site. Small entities may
also contact our office to obtain copies of the compliance guide.
D. Unfunded Mandates Reform Act
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public
Law. 104-4, establishes requirements for federal agencies to assess the
effects of their regulatory actions on state, local, and tribal
governments and the private sector. Under section 202 of the UMRA, EPA
generally must prepare a written statement, including a cost-benefit
analysis, for proposed and final
[[Page 39163]]
rules with ``federal mandates'' that may result in expenditures to
state, local, and tribal governments, in the aggregate, or to the
private sector, of $100 million or more in any one year. Before
promulgating an EPA rule for which a written statement is needed,
section 205 of the UMRA generally requires EPA to identify and consider
a reasonable number of regulatory alternatives and adopt the least
costly, most cost-effective, or least burdensome alternative that
achieves the objectives of the rule. The provisions of section 205 do
not apply when they are inconsistent with applicable law. Moreover,
section 205 allows EPA to adopt an alternative other than the least
costly, most cost-effective, or least burdensome alternative if the
Administrator publishes with the final rule an explanation of why that
alternative was not adopted.
Before EPA establishes any regulatory requirements that may
significantly or uniquely affect small governments, including tribal
governments, it must have developed under section 203 of the UMRA a
small government agency plan. The plan must provide for notifying
potentially affected small governments, enabling officials of affected
small governments to have meaningful and timely input in the
development of EPA regulatory proposals with significant federal
intergovernmental mandates, and informing, educating, and advising
small governments on compliance with the regulatory requirements.
This rule contains no federal mandates for state, local, or tribal
governments as defined by the provisions of Title II of the UMRA. The
rule imposes no enforceable duties on any of these governmental
entities. Nothing in the rule would significantly or uniquely affect
small governments.
EPA has determined that this rule contains federal mandates that
may result in expenditures of more than $100 million to the private
sector in any single year. EPA believes that the final rule represents
the least costly, most cost-effective approach to achieve the air
quality goals of the rule. The costs and benefits associated with the
final rule are discussed above and in the Regulatory Impact Analysis,
as required by the UMRA.
E. Executive Order 13132: Federalism
Executive Order 13132, entitled ``Federalism'' (64 FR 43255, August
10, 1999), requires EPA to develop an accountable process to ensure
``meaningful and timely input by State and local officials in the
development of regulatory policies that have federalism implications.''
``Policies that have federalism implications'' is defined in the
Executive Order to include regulations that 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.''
Under section 6 of Executive Order 13132, EPA may not issue a
regulation that has federalism implications, that imposes substantial
direct compliance costs, and that is not required by statute, unless
the Federal government provides the funds necessary to pay the direct
compliance costs incurred by State and local governments, or EPA
consults with State and local officials early in the process of
developing the proposed regulation. EPA also may not issue a regulation
that has federalism implications and that preempts State law, unless
the Agency consults with State and local officials early in the process
of developing the proposed regulation.
Section 4 of the Executive Order contains additional requirements
for rules that preempt State or local law, even if those rules do not
have federalism implications (i.e., the rules will not have substantial
direct effects on the States, on the relationship between the national
government and the states, or on the distribution of power and
responsibilities among the various levels of government). Those
requirements include providing all affected State and local officials
notice and an opportunity for appropriate participation in the
development of the regulation. If the preemption is not based on
express or implied statutory authority, EPA also must consult, to the
extent practicable, with appropriate State and local officials
regarding the conflict between State law and Federally protected
interests within the agency's area of regulatory responsibility.
This final rule does not have federalism implications. It will not
have substantial direct effects on the States, on the relationship
between the national government and the States, or on the distribution
of power and responsibilities among the various levels of government,
as specified in Executive Order 13132.
Although section 6 of Executive Order 13132 does not apply to this
rule, EPA did consult with representatives of various State and local
governments in developing this rule. EPA has also consulted
representatives from STAPPA/ALAPCO, which represents state and local
air pollution officials.
In the spirit of Executive Order 13132, and consistent with EPA
policy to promote communications between EPA and State and local
governments, EPA specifically solicited comment on the proposed rule
from State and local officials, including from the State of Alaska.
F. Executive Order 13175: Consultation and Coordination With Indian
Tribal Governments
Executive Order 13175, entitled ``Consultation and Coordination
with Indian Tribal Governments'' (59 FR 22951, November 6, 2000),
requires EPA to develop an accountable process to ensure ``meaningful
and timely input by tribal officials in the development of regulatory
policies that have tribal implications.''
This final rule does not have tribal implications as specified in
Executive Order 13175. This rule will be implemented at the Federal
level and impose compliance costs only on engine manufacturers and
diesel fuel producers and distributors. Tribal governments will be
affected only to the extent they purchase and use equipment with
regulated engines. Thus, Executive Order 13175 does not apply to this rule.
G. Executive Order 13045: Protection of Children From Environmental
Health and Safety Risks
Executive Order 13045, ``Protection of Children from Environmental
Health Risks and Safety Risks'' (62 FR 19885, April 23, 1997) applies
to any rule that (1) is determined to be ``economically significant''
as defined under Executive Order 12866, and (2) concerns an
environmental health or safety risk that EPA has reason to believe may
have a disproportionate effect on children. If the regulatory action
meets both criteria, Section 5-501 of the Order directs the Agency to
evaluate the environmental health or safety effects of the planned rule
on children, and explain why the planned regulation is preferable to
other potentially effective and reasonably feasible alternatives
considered by the Agency.
This rule is not subject to the Executive Order because it does not
involve decisions on environmental health or safety risks that may
disproportionately affect children. The EPA believes that the emissions
reductions from the strategies proposed in this rulemaking will further
improve air quality and will further improve children's health.
H. Executive Order 13211: Actions That Significantly Affect Energy
Supply, Distribution, or Use
Executive Order 13211, ``Actions Concerning Regulations That
[[Page 39164]]
Significantly Affect Energy Supply, Distribution, or Use'' (66 FR 28355
(May 22, 2001)), requires EPA to prepare and submit a Statement of
Energy Effects to the Administrator of the Office of Information and
Regulatory Affairs, Office of Management and Budget, for certain
actions identified as ``significant energy actions.'' Section 4(b) of
Executive Order 13211 defines ``significant energy actions'' as ``any
action by an agency (normally published in the Federal Register) that
promulgates or is expected to lead to the promulgation of a final rule
or regulation, including notices of inquiry, advance notices of
proposed rulemaking, and notices of proposed rulemaking: (1)(i) That is
a significant regulatory action under Executive Order 12866 or any
successor order, and (ii) is likely to have a significant adverse
effect on the supply, distribution, or use of energy; or (2) that is
designated by the Administrator of the Office of Information and
Regulatory Affairs as a significant energy action.'' We have prepared a
Statement of Energy Effects for this action as follows:
We have prepared a Statement of Energy Effects for this action as
follows.
This rule's potential adverse effects on energy supply,
distribution, or use have been analyzed, and are discussed in detail
within the following documents:
1. Fuel provisions of the rule and flexibilities, including
hardship provisions, are described in this Preamble, section IV.B. The
provision of sufficient lead time for refiners is discussed in section
IV.F.
2. Potential impacts on fuel supplies are summarized in Preamble
section VI.A.5, RIA section VI.A.5, and within the Summary and Analysis
of Comments document, section 4.6.3.
3. Costs of low-sulfur fuel are discussed in Preamble section VI.F,
and RIA Chapter 7 (demand and production in 7.1, and refining costs in
7.2).
4. Price impacts are summarized in Preamble section VI.A, and RIA
section 7.6, with distribution costs in section 7.4, alternative
estimates of costs in 7.2, and effects of alternative demand
projections in 7.2 as well. Uncertainty in fuel demand is also
discussed in the Summary and Analysis of Comments section 2.3.2.2.
5. The need for adequate short-term investment in low sulfur
refining capacity is addressed in RIA section 5.9.
6. The impacts of regulatory alternatives that were considered are
discussed in Preamble section VII.
In summary, the cost of No. 2 distillate nonroad fuel is projected
to increase overall by approximately 7 cents per gallon (in 2002 dollar
terms) as a result of this rule. This would have a very small effect on
production (projected reduction of approximately 0.02 %, or less than 4
million gallons per year by 2036).
The analysis also concludes that we do not expect this rule to have
any adverse effect on the supply or distribution of NRLM fuel, nor to
result in a significant increase in imports of NRLM fuel. Refiners will
be unlikely to leave the NRLM fuel market and are unlikely to shut down
due to this rule.
Price impacts will vary regionally in the U.S., and are difficult
to project precisely. Analysis of various scenarios in RIA section 7.6
suggests that in PADDs 1 and 3 as well as 2, which account for the bulk
of demand, prices could increase by almost 11 cents per gallon in the
unlikely ``maximum total cost'' scenario of constrained capacity. In
contrast, the ``average total cost'' scenario predicts a 5 cent per
gallon increase in PADDs 1 and 3.
We do not believe there are any reasonable alternatives to the
control of sulfur in nonroad fuel which would allow the reduction in
NOX and PM emissions from nonroad equipment required by
today's rule. There are also no reasonable alternatives to the control
of sulfur in locomotive and marine fuel which would provide the
associated reductions in sulfur dioxide and sulfate PM emissions
provided by the 500 and 15 ppm caps on the sulfur content of this fuel.
I. National Technology Transfer Advancement Act
Section 12(d) of the National Technology Transfer and Advancement
Act of 1995 (``NTTAA''), Public Law 104-113, section 12(d) (15 U.S.C.
272 note) directs EPA to use voluntary consensus standards in its
regulatory activities unless doing so would be inconsistent with
applicable law or otherwise impractical. Voluntary consensus standards
are technical standards (e.g., materials specifications, test methods,
sampling procedures, and business practices) that are developed or
adopted by voluntary consensus standards bodies. The NTTAA directs EPA
to provide Congress, through OMB, explanations when the Agency decides
not to use available and applicable voluntary consensus standards.
This rule involves technical standards. The following paragraph
describes how we specify testing procedures for engines subject to this
proposal.
The International Organization for Standardization (ISO) has a
voluntary consensus standard that can be used to test nonroad diesel
engines. However, the current version of that standard (ISO 8178) is
applicable only for steady-state testing, not for transient testing. As
described in the Regulatory Impact Analysis, transient testing is an
important part of the new emission-control program for these engines.
We are therefore not adopting the ISO procedures in this rulemaking.
J. 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
before the rule is published in the Federal Register. This rule is a
``major rule'' as defined by 5 U.S.C. 804(2).
XI. Statutory Provisions and Legal Authority
Statutory authority for the engine controls adopted today can be
found in sections 213 (which specifically authorizes controls on
emissions from nonroad engines and vehicles), 203-209, 216 and 301 of
the Clean Air Act, 42 U.S.C. 7547, 7522, 7523, 7424, 7525, 7541, 7542,
7543, 7550 and 7601.
Statutory authority for the new fuel controls is found in sections
211(c) and 211(i) of the Clean Air Act, which allow EPA to regulate
fuels that either contribute to air pollution which endangers public
health or welfare or which impair emission control equipment which is
in general use or has been in general use. 42 U.S.C. 7545(c) and (i).
Additional support for the procedural and enforcement-related aspects
of the fuel controls in the final rule, including the record keeping
requirements, comes from sections 114(a) and 301(a) of the CAA. 42
U.S.C. 7414(a) and 7601(a).
List of Subjects
40 CFR Part 9
Reporting and recordkeeping requirements.
40 CFR Part 69
Environmental protection, Air pollution controls.
40 CFR Part 80
Fuel additives, Gasoline, Imports, Incorporation by reference,
Labeling,
[[Page 39165]]
Motor vehicle pollution, Penalties, Reporting and recordkeeping
requirements.
40 CFR Part 86
Environmental protection, Labeling, Motor vehicle pollution,
Reporting and recordkeeping requirements.
40 CFR Part 89
Environmental protection, Administrative practice and procedure,
Confidential business information, Imports, Labeling, Motor vehicle
pollution, Reporting and recordkeeping requirements, Research, Vessels,
Warranties.
40 CFR Part 94
Environmental protection, Administrative practice and procedure,
Air pollution control, Confidential business information, Imports,
Incorporation by reference, Penalties, Reporting and recordkeeping
requirements, Vessels, Warranties.
40 CFR Parts 1039, 1048, and 1051
Environmental protection, Administrative practice and procedure,
Air pollution control, Confidential business information, Imports,
Incorporation by reference, Labeling, Penalties, Reporting and
recordkeeping requirements, Warranties.
40 CFR Part 1065
Environmental protection, Administrative practice and procedure,
Incorporation by reference, Reporting and recordkeeping requirements,
Research.
40 CFR Part 1068
Environmental protection, Administrative practice and procedure,
Confidential business information, Imports, Motor vehicle pollution,
Penalties, Reporting and recordkeeping requirements, Warranties.
Dated: May 11, 2004.
Michael O. Leavitt,
Administrator.
? For the reasons set out in the preamble, title 40, chapter I, of the
Code of Federal Regulations is amended as set forth below.
PART 9--OMB APPROVALS UNDER THE PAPERWORK REDUCTION ACT
? 1. The authority citation for part 9 continues to read as follows:
Authority: 7 U.S.C. 135 et seq., 136-136y; 15 U.S.C. 2001, 2003,
2005, 2006, 2601-2671; 21 U.S.C. 331j, 346a, 348; 31 U.S.C. 9701; 33
U.S.C. 1251 et seq., 1311, 1313d, 1314, 1318 1321, 1326, 1330, 1342
1344, 1345(d) and (e), 1361; E.O. 11735, 38 FR 21243, 3 CFR, 1971-
1975 Comp. p. 973; 42 U.S.C. 241, 242b, 243, 246, 300f, 300g, 300g-
1, 300g-2, 300g-3, 300g-4, 300g-5, 300g-6, 300j-1, 300j-2, 300j-3,
300j-4, 300j-9, 1857 et seq., 6901-6992k, 7401-7671q, 7542, 9601-
9657, 11023, 11048.
Sec. 9.1 [Amended]
? 2. Section 9.1 is amended in the table by adding the center headings
and the entries under those center headings in numerical order to read
as follows:
* * * * *
Control of Emissions From New, Large Nonroad Spark-Ignition Engines
1048.20 2040-0460
1048.201-250 2040-0460
1048.345 2040-0460
1048.350 2040-0460
1048.420 2040-0460
1048.425 2040-0460
* * * * *
Control of Emissions from Recreational Engines and Vehicles
1051.201-255 2060-0104
1051.345 2060-0104
1051.350 2060-0104
1051.725 2060-0104
1051.730 2060-0104
* * * * *
General Compliance Provisions for Nonroad Programs
1068.5 2040-0460
1068.25 2040-0460
1068.27 2040-0460
1068.120 2040-0460
1068.201-260 2040-0460
1068.301-355 2040-0460
1068.450 2040-0460
1068.455 2040-0460
1068.501 2040-0460
1068.525 2040-0460
1068.530 2040-0460
* * * * *
PART 69--SPECIAL EXEMPTIONS FROM THE REQUIREMENTS OF THE CLEAN AIR ACT
? 3. The authority citation for part 69 continues to read as follows:
Authority: 42 U.S.C. 7545(c), (g), and (i), and 7625-1.
? 4. Section 69.51 is revised to read as follows:
Sec. 69.51 Motor vehicle diesel fuel.
(a) Diesel fuel that is designated for use only in Alaska and is
used only in Alaska, is exempt from the sulfur standard of 40 CFR
80.29(a)(1) and the dye provisions of 40 CFR 80.29(a)(3) and 40 CFR
80.29(b) until the implementation dates of 40 CFR 80.500, provided that:
(1) The fuel is segregated from nonexempt diesel fuel from the
point of such designation; and
(2) On each occasion that any person transfers custody or title to
the fuel, except when it is dispensed at a retail outlet or wholesale
purchaser-consumer facility, the transferor must provide to the
transferee a product transfer document stating:
This diesel fuel is for use only in Alaska. It is exempt from
the federal low sulfur standards applicable to highway diesel fuel
and red dye requirements applicable to non-highway diesel fuel only
if it is used in Alaska.
(b) Beginning on the implementation dates under 40 CFR 80.500,
motor vehicle diesel fuel that is designated for use in Alaska or is
used in Alaska, is subject to the applicable provisions of 40 CFR part
80, subpart I, except as provided under 40 CFR 69.52(c), (d), and (e)
for commingled motor vehicle and non-motor vehicle diesel fuel.
(c) The Governor of Alaska may submit for EPA approval, by April 1,
2002, a plan for implementing the motor vehicle diesel fuel sulfur
standard in Alaska as an alternative to the temporary compliance option
provided under 40 CFR 80.530 through 80.532. If EPA approves an
alternative plan, the provisions as approved by EPA under that plan
shall apply to the diesel fuel subject to paragraph (b) of this section.
? 5. A new Sec. 69.52 is added to read as follows:
Sec. 69.52 Non-motor vehicle diesel fuel.
(a) Definitions. (1) Areas accessible by the Federal Aid Highway
System are the geographical areas of Alaska designated by the State of
Alaska as being accessible by the Federal Aid Highway System.
(2) Areas not accessible by the Federal Aid Highway System are all
other geographical areas of Alaska.
(3) Nonroad, locomotive, or marine diesel fuel (NRLM) has the
meaning given in 40 CFR 80.2.
(b) Applicability. NRLM diesel fuel and heating oil that are used
or intended for use in areas of Alaska accessible by the Federal Aid
Highway System are subject to the provisions of 40 CFR part 80, subpart
I, except as provided in paragraphs (c), (d) and (e) of this section.
(c) Dye and marker. (1) NRLM diesel fuel and heating oil referred
to in paragraph (b) of this section are exempt from the red dye
requirements, and the presumptions associated with the red dye
requirements, under 40 CFR 80.520(b)(2) and 80.510(d)(5), (e)(5), and
(f)(5).
(2) NRLM diesel fuel and heating oil referred to in paragraph (b)
of this section are exempt from the marker solvent yellow 124
requirements, and
[[Page 39166]]
the presumptions associated with the marker solvent yellow 124
requirements, under 40 CFR 80.510(d) through (f).
(3) Exempt NRLM diesel fuel and heating oil must be segregated from
all non-exempt NRLM diesel fuel and heating oil.
(4) Exempt heating oil must be segregated from exempt NRLM diesel
fuel unless it also meets the standards of 40 CFR 80.510 applicable to
the NRLM diesel fuel.
(5) Exempt NRLM diesel fuel and heating oil must be segregated from
motor vehicle diesel fuel, unless it also meets the standards of 40 CFR
80.520 applicable to the motor vehicle diesel fuel.
(d) Product transfer documents. Product Transfer Documents for
exempt NRLM diesel fuel and heating oil shall include the language
specified in 40 CFR 80.590(a) applicable to undyed diesel fuel for the
appropriate sulfur level, and the following additional language as
applicable:
(1) For exempt NRLM diesel fuel and heating oil, including
commingled fuel under paragraph (c)(4) or (c)(5) of this section:
``Exempt from red dye requirement applicable to diesel fuel for non-
highway purposes if it is used only in Alaska.''
(2) For exempt heating oil, including commingled fuel under
paragraph (c)(4) or (c)(5) of this section: ``Exempt from marker
solvent yellow 124 requirement applicable to heating oil if it is used
only in Alaska.''
(3) For exempt 500 ppm sulfur LM diesel fuel, including commingled
fuel under paragraph (c)(4) or (c)(5) of this section: ``Exempt from
marker solvent yellow 124 requirement applicable to 500 ppm sulfur LM
diesel fuel if it is used only in Alaska.''
(e) Pump labels. (1) Pump labels for exempt NRLM diesel fuel and
heating oil shall contain the language specified in 40 CFR 80.570
through 80.574 for the applicable fuel type and time frame, unless the
fuel is commingled under paragraph (c)(4) or (c)(5) of this section.
(2) Pump labels for exempt NRLM diesel fuel and heating oil that
are commingled shall contain the language specified in 40 CFR 80.570
through 80.574 for NRLM diesel fuel and the applicable time frame.
(3) Pump labels for exempt NRLM diesel fuel and heating oil that
are commingled with motor vehicle diesel fuel shall contain the
following language for the applicable sulfur level and time frame:
(i) 500 ppm sulfur diesel fuel. From June 1, 2006 through September
30, 2010.
LOW SULFUR DIESEL FUEL (500 ppm Sulfur Maximum)
WARNING
Federal Law prohibits use in model year 2007 and later highway
diesel vehicles and engines
Its use may damage these vehicles and engines.
For use in all other diesel vehicles and engines.
(ii) 15 ppm sulfur diesel fuel. From June 1, 2006 through May 31,
2010.
ULTRA-LOW SULFUR DIESEL FUEL (15 ppm Sulfur Maximum)
Required for model year 2007 and later highway diesel vehicles
and engines.
Recommended for use in all diesel vehicles and engines.
(iii) 15 ppm sulfur diesel fuel. From June 1, 2010, and beyond,
ULTRA-LOW SULFUR DIESEL FUEL (15 ppm Sulfur Maximum)
Required for use in all highway and nonroad diesel engines
Recommended for use in all diesel vehicles and engines.
(f) Non-motor vehicle diesel fuel and heating oil that is used or
intended for use only in areas of Alaska not accessible by the Federal
Aid Highway System, are excluded from the applicable provisions of 40
CFR part 80, subpart I, except that--
(1) All model year 2011 and later nonroad diesel engines and
equipment must be fueled only with diesel fuel that meets the
specifications of 40 CFR 80.510(b) or (c);
(2) The following language shall be added to any product transfer
document: ``This fuel is for use only in those areas of Alaska not
accessible by the FAHS''; and
(3) Pump labels for such fuel that does not meet the specifications
of 40 CFR 80.510(b) or (c) shall contain the following language:
HIGH SULFUR DIESEL FUEL (may be greater than 15 Sulfur ppm)
WARNING
Federal Law prohibits use in model year 2007 and later highway
diesel vehicles and engines, or in model year 2011 and later nonroad
diesel engines and equipment.
Its use may damage these vehicles and engines.
(g) Alternative labels to those specified in paragraphs (e)(3) and
(f)(3) of this section may be used as approved by the Administrator.
PART 80--REGULATION OF FUELS AND FUEL ADDITIVES
? 6. The authority citation for part 80 continues to read as follows:
Authority: 42 U.S.C. 7414, 7545, and 7601(a).
? 7. Section 80.2 is amended by adding paragraph (f) and revising
paragraphs (j), (o), (x), (y), and (xx), removing and reserving
paragraph (nn), adding and reserving paragraphs (yy), and (zz), and
adding and reserving paragraphs (aaa) through (rrr) to read as follows:
Sec. 80.2 Definitions.
* * * * *
(f) Previously designated diesel fuel or PDD means diesel fuel that
has been previously designated and included by a refiner or importer in
a batch for purposes of complying with the standards and requirements
of subpart I of this part.
* * * * *
(j) Retail outlet means any establishment at which gasoline, diesel
fuel, methanol, natural gas or liquified petroleum gas is sold or
offered for sale for use in motor vehicles or nonroad engines,
including locomotive engines or marine engines.
* * * * *
(o) Wholesale purchaser-consumer means any person that is an
ultimate consumer of gasoline, diesel fuel, methanol, natural gas, or
liquified petroleum gas and which purchases or obtains gasoline, diesel
fuel, natural gas or liquified petroleum gas from a supplier for use in
motor vehicles or nonroad engines, including locomotive engines or
marine engines and, in the case of gasoline, diesel fuel, methanol or
liquified petroleum gas, receives delivery of that product into a
storage tank of at least 550-gallon capacity substantially under the
control of that person.
* * * * *
(x) Diesel fuel means any fuel sold in any State or Territory of
the United States and suitable for use in diesel engines, and that is--
(1) A distillate fuel commonly or commercially known or sold as No.
1 diesel fuel or No. 2 diesel fuel;
(2) A non-distillate fuel other than residual fuel with comparable
physical and chemical properties (e.g., biodiesel fuel); or
(3) A mixture of fuels meeting the criteria of paragraphs (1) and
(2) of this definition.
(y) Motor vehicle diesel fuel means any diesel fuel or other
distillate fuel that is used, intended for use, or made available for
use in motor vehicles or motor vehicle engines.
* * * * *
(xx) Diesel fuel additive means any substance not composed solely
of carbon and/or hydrogen, or of diesel blendstocks, that is added to,
intended to be added to, used in, or offered for
[[Page 39167]]
use in motor vehicle diesel fuel or NRLM diesel fuel or in diesel motor
vehicle or diesel NRLM engine fuel systems subsequent to the production
of diesel fuel by processing crude oil from refinery processing units.
(yy)-(zz) [Reserved]
(aaa) Distillate fuel means diesel fuel and other petroleum fuels
that can be used in engines that are designed for diesel fuel. For
example, jet fuel, heating oil, kerosene, No. 4 fuel, DMX, DMA, DMB,
and DMC are distillate fuels; and natural gas, LPG, gasoline, and
residual fuel are not distillate fuels. Blends containing residual fuel
may be distillate fuels.
(bbb) Residual fuel means a petroleum fuel that can only be used in
diesel engines if it is preheated before injection. For example, No. 5
fuels, No. 6 fuels, and RM grade marine fuels are residual fuels. Note:
Residual fuels do not necessarily require heating for storage or
pumping.
(ccc) Heating oil means any No. 1 or No. 2 distillate fuel that is
sold for use in furnaces, boilers, stationary diesel engines, and
similar applications and which is commonly or commercially known or
sold as heating oil, fuel oil, and similar trade names, and that is not
jet fuel, kerosene, or MVNRLM diesel fuel.
(ddd) Jet fuel means any distillate fuel used, intended for use, or
made available for use in aircraft.
(eee) Kerosene means any No.1 distillate fuel commonly or
commercially sold as kerosene.
(fff) #1D means the distillate fuel classification relating to
``No. 1-D'' diesel fuels as described in ASTM D 975-04. The Director of
the Federal Register approved the incorporation by reference of ASTM D
975-04, Standard Specification for Diesel Fuel Oils, as prescribed in 5
U.S.C. 552(a) and 1 CFR part 51. Anyone may purchase copies of this
standard from the American Society for Testing and Materials, 100 Barr
Harbor Dr., West Conshohocken, PA 19428. Anyone may inspect copies at
the U.S. EPA, Air and Radiation Docket and Information Center, 1301
Constitution Ave., NW., Room B102, EPA West Building, Washington, DC
20460 or at the National Archives and Records Administration (NARA).
For information on the availability of this material at NARA, call 202-
741-6030, or go to: http://www.archives.gov/federal_register/
code_of_federal_regulations/ibr_locations.html. 
(ggg) #2D means the distillate fuel classification relating to
``No. 2-D'' diesel fuels as described in ASTM D 975-04.
(hhh)-(jjj) [Reserved]
(kkk) Nonroad diesel engine means an engine that is designed to
operate with diesel fuel that meets the definition of nonroad engine in
40 CFR 1068.30, including locomotive and marine diesel engines.
(lll) Locomotive engine means an engine used in a locomotive as
defined under 40 CFR 92.2.
(mmm) Marine engine and Category 3 have the meanings given under 40
CFR 94.2.
(nnn) Nonroad, locomotive, or marine (NRLM) diesel fuel means any
diesel fuel or other distillate fuel that is used, intended for use, or
made available for use, as a fuel in any nonroad diesel engines,
including locomotive and marine diesel engines, except the following:
Distillate fuel with a T90 greater than 700 [deg]F that is used only in
Category 2 and 3 marine engines is not NRLM diesel fuel. Use the
distillation test method specified in 40 CFR 1065.1010 to determine the
T90 of the fuel. NR diesel fuel and LM diesel fuel are subcategories of
NRLM diesel fuel.
(ooo) Nonroad (NR) diesel fuel means any NRLM diesel fuel that is
not ``locomotive or marine (LM) diesel fuel.''
(ppp) Locomotive or marine (LM) diesel fuel means any diesel fuel
or other distillate fuel that is used, intended for use, or made
available for use, as a fuel in locomotive or marine diesel engines,
except for the following fuels:
(1) Fuel that is also used, intended for use, or made available for
use in motor vehicle engines or nonroad engines other than locomotive
and marine diesel engines is not LM diesel fuel.
(2) Distillate fuel with a T90 greater than 700 [deg]F that is used
only in Category 2 and 3 marine engines is not LM diesel fuel. Use the
distillation test method specified in 40 CFR 1065.1010 to determine the
T90 of the fuel.
(qqq) MVNRLM diesel fuel means any diesel fuel or other distillate
fuel that meets the definition of motor vehicle (MV) or nonroad,
locomotive, or marine (NRLM) diesel fuel. Motor vehicle diesel fuel,
NRLM diesel fuel, NR diesel fuel, and LM diesel fuel are subcategories
of MVNRLM diesel fuel.
(rrr) Solvent yellow 124 means N-ethyl-N-[2-[1-(2-
methylpropoxy)ethoxyl]-4-phenylazo]-benzeneamine.
? 8. Section 80.230 is amended by revising paragraph (b) to read as
follows:
Sec. 80.230 Who is not eligible for the hardship provisions for small
refiners?
* * * * *
(b)(1)(i) Refiners who qualify as small under Sec. 80.225 and
subsequently cease production of diesel fuel from processing crude oil
through refinery processing units, or employ more than 1,500 people or
exceed the 155,000 bpcd crude oil capacity limit after January 1, 2004
as a result of merger with or acquisition of or by another entity, are
disqualified as small refiners, except this shall not apply in the case
of a merger between two previously approved small refiners. If
disqualification occurs, the refiner shall notify EPA in writing no
later than 20 days following this disqualifying event.
(ii) Except as provided under paragraph (b)(1)(iii) of this
section, any refiner whose status changes under this paragraph shall
meet the applicable standards of Sec. 80.195 within a period of up to
30 months of the disqualifying event for any of its refineries that
were previously subject to the small refiner standards of Sec.
80.240(a). However, such period shall not extend beyond December 31,
2007, or, for refineries for which the Administrator has approved an
extension of the small refiner gasoline sulfur standards under Sec.
80.553(c), December 31, 2010.
(iii) A refiner may apply to EPA for an additional six months to
comply with the standards of Sec. 80.195 if more than 30 months will
be required for the necessary engineering, permitting, construction,
and start-up work to be completed. Such applications must include
detailed technical information supporting the need for additional time.
EPA will base its decision to approve additional time on the
information provided by the refiner and on other relevant information.
In no case will EPA extend the compliance date beyond December 31,
2007, or, for refineries for which the Administrator has approved an
extension of the small refiner gasoline sulfur standards under Sec.
80.553(c), December 31, 2010.
(iv) During the period of time up to 30 months provided under
paragraph (b)(1)(ii) of this section, and any extension provided under
paragraph (b)(1)(iii) of this section, the refiner may not generate
gasoline sulfur credits under Sec. 80.310.
(2) Any refiner who qualifies as a small refiner under Sec. 80.225
may elect to meet the standards under Sec. 80.195 by notifying EPA in
writing no later than November 15 prior to the year that the change
will occur. Any refiner whose status changes under this paragraph
(b)(2) shall meet the standards under Sec. 80.195 beginning with the
first averaging period subsequent to the status change.
? 9. Section 80.240 is amended by adding paragraph (f) to read as follows:
[[Page 39168]]
Sec. 80.240 What are the small refiner gasoline sulfur standards?
* * * * *
(f)(1) In the case of a refiner without approved small refiner
status who acquires a refinery from a refiner with approved small
refiner status under Sec. 80.235, the applicable small refiner
standards under paragraph (a) of this section will apply to the
acquired small refinery for a period up to 30 months from the date of
acquisition of the refinery, but no later than December 31, 2007, or,
for a refinery for which the Administrator has approved an extension of
the small refiner gasoline sulfur standards under Sec. 80.553(c),
December 31, 2010, after which time the standards of Sec. 80.195 shall
apply to the acquired refinery.
(2) A refiner may apply to EPA for an additional six months to
comply with the standards of Sec. 80.195 for the acquired refinery if
more than 30 months will be required for the necessary engineering,
permitting, construction, and start-up work to be completed. Such
applications must include detailed technical information supporting the
need for additional time. EPA will base its decision to approve
additional time on information provided by the refiner and on other
relevant information. In no case will EPA extend the compliance date
beyond December 31, 2007, or, for a refinery for which the
Administrator has approved an extension of the small refiner gasoline
sulfur standards under Sec. 80.553(c), December 31, 2010.
? 10. Section 80.500 is amended by removing paragraph (f) and revising
the section heading to read as follows:
80.500 What are the implementation dates for the motor vehicle diesel
fuel sulfur control program?
? 11. Section 80.501 is revised to read as follows:
Sec. 80.501 What fuel is subject to the provisions of this subpart?
(a) Included fuel and additives. The provisions of this subpart
apply to the following fuels and additives except as specified in
paragraph (b) of this section:
(1) Motor vehicle diesel fuel.
(2) Nonroad, locomotive, or marine diesel fuel.
(3) Diesel fuel additives.
(4) Heating oil.
(5) Other distillate fuels.
(6) Motor oil that is used as or intended for use as fuel in diesel
motor vehicles or nonroad diesel engines or is blended with diesel fuel
for use in diesel motor vehicles or nonroad diesel engines, including
locomotive and marine diesel engines, at any downstream location.
(b) Excluded fuel. The provisions of this subpart do not apply to
distillate fuel that is designated for export outside the United States
in accordance with Sec. 80.598, identified for export by a transfer
document as required under Sec. 80.590, and that is exported.
? 12. A new Sec. 80.502 is added to read as follows:
Sec. 80.502 What definitions apply for purposes of this subpart?
The definitions of Sec. 80.2 and the following additional
definitions apply to this subpart I:
(a) Entity means any refiner, importer, distributor, retailer or
wholesale-purchaser consumer of any distillate fuel.
(b) Facility means any place, or series of places, where an entity
produces, imports, or maintains custody of any distillate fuel from the
time it is received to the time custody is transferred to another
entity, except as described in paragraphs (b)(1) through (b)(4) of this
section:
(1) Where an entity maintains custody of a batch of diesel fuel
from one place in the distribution system to another place (e.g., from
a pipeline to a terminal), all owned by the same entity, both places
combined are considered to be one single aggregated facility, except
where an entity chooses to treat components of such an aggregated
facility as separate facilities. The choice made to treat these places
as separate facilities may not be changed by the entity during any
applicable compliance period. Except as specified in paragraph (b)(2)
of this section, where compliance requirements depend upon facility-
type, the entire facility must comply with the requirements that apply
to its components as follows:
(i) If an aggregated facility includes a refinery, the entire
facility must comply with the requirements applicable to refineries.
(ii) If an aggregated facility includes a truck loading terminal
but not a refinery, the entire facility must comply with the
requirements applicable to truck loading terminals.
(2) A refinery or import facility may not be aggregated with
facilities that receive fuel from other refineries or import
facilities, either directly or indirectly. For example, a refinery may
not be aggregated with a terminal that receives any fuel from a common
carrier pipeline. However, a refinery may be aggregated with a pipeline
and terminal that are owned by the same entity and which receive no
fuel from any source other than the refinery. If a refinery or import
facility is aggregated with other facilities, then the aggregated
facility is treated as a refinery or import facility.
(3) Retail outlets or wholesale purchaser consumers may not be
aggregated with any other facility.
(4) Where an entity maintains custody of diesel fuel in one or more
mobile components (e.g., rail, barge, or trucking operations) the
mobile components may be aggregated as a single facility. Mobile
components may also be aggregated with a facility from which they
receive fuel or a facility to which they deliver fuel. However, mobile
components may not be aggregated with both a facility from which they
receive fuel and a facility to which they deliver fuel.
(5) An individual refinery or contiguous pipeline may not be
subdivided into more than one facility. An individual terminal may not
be subdivided into more than one facility unless approved by the
Administrator.
(c) Truck loading terminal means any facility that dyes NRLM diesel
fuel, pays taxes on motor vehicle diesel fuel per IRS code (26 CFR part
48), or adds a fuel marker pursuant to Sec. 80.510 to heating oil and
delivers diesel fuel or heating oil into trucks for delivery to retail
or ultimate consumer locations.
(d) Batch means a quantity of diesel fuel or distillate which is
homogeneous with regard to those properties that are specified for
MVNRLM diesel fuel under this subpart I of this part, has the same
designation under this subpart I (if applicable), and whose custody is
transferred from one facility to another facility.
(e) Downstream location means any point in the diesel fuel
distribution system that is downstream of refineries and import
facilities, for example, diesel fuel at facilities of distributors,
carriers, retailers, kerosene blenders, and wholesale purchaser-consumers.
? 13. A new Sec. 80.510 is added to read as follows:
Sec. 80.510 What are the standards and marker requirements for NRLM
diesel fuel?
(a) Beginning June 1, 2007. Except as otherwise specifically
provided in this subpart, all NRLM diesel fuel is subject to the
following per-gallon standards:
(1) Sulfur content. 500 parts per million (ppm) maximum.
(2) Cetane index or aromatic content, as follows:
(i) A minimum cetane index of 40; or
(ii) A maximum aromatic content of 35 volume percent.
(b) Beginning June 1, 2010. Except as otherwise specifically
provided in this subpart, all NR and LM diesel fuel is subject to the
following per-gallon standards:
[[Page 39169]]
(1) Sulfur content.
(i) 15 ppm maximum for NR diesel fuel.
(ii) 500 ppm maximum for LM diesel fuel.
(2) Cetane index or aromatic content, as follows:
(i) A minimum cetane index of 40; or
(ii) A maximum aromatic content of 35 volume percent.
(c) Beginning June 1, 2012. Except as otherwise specifically
provided in this subpart, all NRLM diesel fuel is subject to the
following per-gallon standards:
(1) Sulfur content. 15 ppm maximum.
(2) Cetane index or aromatic content, as follows:
(i) A minimum cetane index of 40; or
(ii) A maximum aromatic content of 35 volume percent.
(d) Marking provisions. From June 1, 2007 through May 31, 2010:
(1) Except as provided for in paragraph (i) of this section, prior
to distribution from a truck loading terminal, all heating oil shall
contain six milligrams per liter of marker solvent yellow 124.
(2) All motor vehicle and NRLM diesel fuel shall be free of solvent
yellow 124.
(3) Any diesel fuel that contains greater than or equal to 0.10
milligrams per liter of marker solvent yellow 124 shall be deemed to be
heating oil and shall be prohibited from use in any motor vehicle or
nonroad diesel engine (including locomotive, or marine diesel engines).
(4) Except as provided for in paragraph (i) of this section, any
diesel fuel, other than jet fuel or kerosene that is downstream of a
truck loading terminal, that contains less than 0.10 milligrams per
liter of marker solvent yellow 124 shall be considered motor vehicle
diesel fuel or NRLM diesel fuel, as appropriate.
(5) Any heating oil that is required to contain marker solvent
yellow 124 pursuant to the requirements of this paragraph (d) must also
contain visible evidence of dye solvent red 164.
(e) Marking provisions. From June 1, 2010 through May 31, 2012:
(1) Except as provided for in paragraph (i) of this section, prior
to distribution from a truck loading terminal, all heating oil and
diesel fuel designated as 500 ppm sulfur LM diesel fuel shall contain
six milligrams per liter of solvent yellow 124.
(2) All motor vehicle and NR diesel fuel shall be free of marker
solvent yellow 124.
(3) Any diesel fuel that contains greater than or equal to 0.10
milligrams per liter of marker solvent yellow 124 shall be deemed to be
LM diesel fuel or heating oil, as appropriate, and shall be prohibited
from use in any motor vehicle or nonroad diesel engine (except for
locomotive or marine diesel engines).
(4) Except as provided for in paragraph (i) of this section, any
diesel fuel, other than jet fuel or kerosene that is downstream of a
truck loading terminal, that contains less than 0.10 milligrams per
liter of marker solvent yellow 124 shall be considered motor vehicle
diesel fuel or NR diesel fuel, as appropriate.
(5) Any LM diesel fuel or heating oil that is required to contain
marker solvent yellow 124 pursuant to the requirements of this
paragraph (e) must also contain visible evidence of dye solvent red 164.
(f) Marking provisions. Beginning June 1, 2012:
(1) Except as provided for in paragraph (i) of this section, prior
to distribution from a truck loading terminal, all heating oil shall
contain six milligrams per liter of marker solvent yellow 124.
(2) All motor vehicle and NRLM diesel fuel shall be free of marker
solvent yellow 124.
(3) Any diesel fuel that contains greater than or equal to 0.10
milligrams per liter of marker solvent yellow 124 shall be deemed to be
heating oil and shall be prohibited from use in any motor vehicle or
nonroad diesel engine (including locomotive, or marine diesel engines).
(4) Except as provided for in paragraph (i) of this section, any
diesel fuel, other than jet fuel or kerosene that is downstream of a
truck loading terminal, that contains less than 0.10 milligrams per
liter of marker solvent yellow 124 shall be considered motor vehicle
diesel fuel or NRLM diesel fuel, as appropriate.
(5) Any heating oil that is required to contain marker solvent
yellow 124 pursuant to the requirements of this paragraph (f) must also
contain visible evidence of dye solvent red 164.
(g) Special provisions in this part apply to the following areas:
(1) Northeast/Mid-Atlantic Area which includes the following states
and counties: North Carolina, Virginia, Maryland, Delaware, New Jersey,
Connecticut, Rhode Island, Massachusetts, Vermont, New Hampshire,
Maine, Washington D.C., New York (except for the counties of
Chautauqua, Cattaraugus, and Allegany), Pennsylvania (except for the
counties of Erie, Warren, Mc Kean, Potter, Cameron, Elk, Jefferson,
Clarion, Forest, Venango, Mercer, Crawford, Lawrence, Beaver,
Washington, and Greene), and the eight eastern-most counties of West
Virginia (Jefferson, Berkeley, Morgan, Hampshire, Mineral, Hardy,
Grant, and Pendleton).
(2) Alaska.
(h) Pursuant and subject to the provisions of Sec. Sec. 80.536,
80.554, 80.560, and 80.561:
(1) Except as provided in paragraph (j) of this section, from June
1, 2007 through May 31, 2010, NRLM diesel fuel produced or imported in
full compliance with the requirements of Sec. Sec. 80.536, 80.554,
80.560, and 80.561 is exempt from the per-gallon sulfur content
standard and cetane or aromatics standard of paragraph (a) of this section.
(2) Except as provided in paragraph (j) of this section, from June
1, 2010 through May 31, 2012 for NR diesel fuel and from June 1, 2012
through May 31, 2014 for NRLM diesel fuel produced or imported in full
compliance with the requirements of Sec. Sec. 80.536, 80.554, 80.560,
and 80.561 is exempt from the per-gallon standards of paragraphs (b)
and (c) of this section, but is subject to the per-gallon standards of
paragraph (a) of this section.
(i) The marking requirements of paragraphs (d)(1), (d)(4), (e)(1),
(e)(4), (f)(1), and (f)(4) of this section do not apply to heating oil,
or, for paragraphs (e)(1) and (e)(4) of this section, diesel fuel
designated as LM diesel fuel that is distributed from a truck loading
terminal located within the areas listed in paragraphs (g)(1) and
(g)(2) of this section and is for sale or intended for sale within
these areas, or that is distributed from any other truck loading
terminal and is for sale or intended for sale within the area listed in
(g)(2) of this section.
(j) The provisions of paragraphs (h)(1) and (h)(2) of this section
do not apply to diesel fuel sold or intended for sale in the areas
listed in paragraph (g)(1) of this section that is produced or imported
in full compliance with the requirements of Sec. Sec. 80.536 and
80.554 or to diesel fuel sold or intended for sale in the area listed
in paragraph (g)(2) of this section that is produced or imported in
full compliance with the requirements of Sec. 80.536.
? 14. A new Sec. 80.511 is added to read as follows:
Sec. 80.511 What are the per-gallon and marker requirements that
apply to NRLM diesel fuel and heating oil downstream of the refiner or
importer?
(a) Applicable dates for marker requirements. Beginning June 1,
2006, all NRLM diesel fuel shall contain less than 0.10 milligrams per
liter of the marker solvent yellow 124, except for
[[Page 39170]]
LM diesel fuel subject to the marking requirements of Sec. 80.510(e).
(b) Applicable dates for per-gallon standards. (1) Beginning June
1, 2006, all NRLM diesel fuel must comply with the per-gallon sulfur
standard for the designation or classification stated on its PTD, pump
label, or other documentation. Based on the provisions of Sec.
80.510(h) and (j), there is no uniform downstream sulfur standard until
the downstream dates identified in paragraphs (b)(3) through (b)(8) of
this section.
(2) Except as provided in paragraphs (b)(5) and (b)(8) of this
section, beginning December 1, 2010, all NRLM diesel fuel must comply
with the cetane index or aromatics standard of Sec. 80.510.
(3) Except as provided in paragraphs (b)(5) through (b)(8) of this
section, the per-gallon sulfur standard of Sec. 80.510(a) shall apply
to all NRLM diesel fuel beginning August 1, 2010 for all downstream
locations other than retail outlets or wholesale purchaser-consumer
facilities, shall apply to all NRLM diesel fuel beginning October 1,
2010 for retail outlets and wholesale purchaser-consumer facilities,
and shall apply to all NRLM diesel fuel beginning December 1, 2010 for
all locations.
(4) Except as provided in paragraphs (b)(5) through (b)(8) of this
section, the per-gallon sulfur standard of Sec. 80.510(c) shall apply
to all NRLM diesel fuel beginning August 1, 2014 for all downstream
locations other than retail outlets or wholesale purchaser-consumer
facilities, shall apply to all NRLM diesel fuel beginning October 1,
2014 for retail outlets and wholesale purchaser-consumer facilities,
and shall apply to all NRLM diesel fuel beginning December 1, 2014 for
all locations. This paragraph (b)(4) does not apply to LM diesel fuel
that is sold or intended for sale in areas other than those listed in
Sec. 80.510(g)(1) or (g)(2).
(5) For all NRLM diesel fuel that is sold or intended for sale in
the areas listed in Sec. 80.510(g)(1), the per-gallon sulfur standard
and the cetane index or aromatics standard of 80.510(a) shall apply to
all NRLM diesel fuel beginning August 1, 2007 for all downstream
locations other than retail outlets or wholesale purchaser-consumer
facilities, shall apply to all NRLM diesel fuel beginning October 1,
2007 for retail outlets and wholesale purchaser-consumer facilities,
and shall apply to all NRLM diesel fuel beginning December 1, 2007 for
all locations.
(6) For all NR diesel fuel that is sold or intended for sale in the
areas listed in Sec. 80.510(g)(1), the per-gallon sulfur standard of
Sec. 80.510(b) shall apply to all NR diesel fuel beginning August 1,
2010 for all downstream locations other than retail outlets or
wholesale purchaser-consumer facilities, shall apply to all NR diesel
fuel beginning October 1, 2010 for retail outlets and wholesale
purchaser-consumer facilities, and shall apply to all NR diesel fuel
beginning December 1, 2010 for all locations.
(7) For all NRLM diesel fuel that is sold or intended for sale in
the areas listed in Sec. 80.510(g)(1), the per-gallon sulfur standard
of Sec. 80.510(c) shall apply to all NRLM diesel fuel beginning August
1, 2012 for all downstream locations other than retail outlets or
wholesale purchaser-consumer facilities, shall apply to all NRLM diesel
fuel beginning October 1, 2012 for retail outlets and wholesale
purchaser-consumer facilities, and shall apply to all NRLM diesel fuel
beginning December 1, 2012 for all locations.
(8) The provisions of paragraphs (b)(5) through (b)(7) of this
section shall apply for all NRLM or NR diesel fuel that is sold or
intended for sale in the area listed in Sec. 80.510(g)(2), except for
NRLM or NR diesel fuel that is produced in accordance with a compliance
plan approved under Sec. 80.554.
(9) For the purposes of this section, distributors that have their
own fuel storage tanks and deliver only to ultimate consumers shall be
treated the same as retailers and their facilities treated the same as
retail outlets.
? 15. A new Sec. 80.512 is added to read as follows:
Sec. 80.512 May an importer treat diesel fuel as blendstock?
An importer may exclude diesel fuel that it imports from the
requirements under this subpart, and instead may designate such diesel
fuel as diesel fuel treated as blendstock (DTAB), if all the following
conditions are met:
(a) The DTAB must be included in all applicable designation, credit
and compliance calculations for diesel fuel for a refinery operated by
the same entity that is the importer . That entity must meet all
refiner standards and requirements.
(b) The importer entity may not transfer title of the DTAB to
another entity until the DTAB has been used to produce diesel fuel and
all refiner standards and requirements have been met for the diesel
fuel produced.
(c) The refinery at which the DTAB is used to produce diesel fuel
must be physically located at either the same terminal at which the
DTAB first arrives in the U.S., the import facility, or at a facility
to which the DTAB is directly transported from the import facility.
(d) The DTAB must be completely segregated from any other diesel
fuel, including any diesel fuel tank bottoms, prior to the point of
blending, sampling and testing in the importer entity's refinery
operation. The DTAB may, however, be added to a diesel fuel blending
tank where the diesel fuel tank bottom is not included as part of the
batch volume for a prior batch. In addition, the DTAB may be placed
into a storage tank that contains other DTAB imported by that importer.
The DTAB also may be discharged into a tank containing finished diesel
fuel of the same category as the diesel fuel which will be produced
using the DTAB (for example, 15 ppm sulfur undyed or 15 ppm sulfur dyed
diesel fuel) provided the blending process is performed in that same tank.
(e) The entity must account for the volume of diesel fuel produced
using DTAB in a manner that excludes the volume of any previously
designated diesel fuel. The diesel fuel tank bottom may not be included
in the company's refinery compliance calculations for that batch of
diesel fuel if the fuel in that tank bottom has been previously
designated by a refiner or importer. This exclusion of previously
designated diesel fuel must be accomplished using the following approach:
(1) Determine the volume of any tank bottom that is previously
designated diesel fuel before any diesel fuel production begins.
(2) Add the DTAB plus any blendstock to the storage tank, and
completely mix the tank.
(3) Determine the volume and sulfur content of the diesel fuel
contained in the storage tank after blending is complete.
Mathematically subtract the volume of the tank bottom to determine the
volume of the DTAB plus blendstock added, and subsequently transferred
to another facility. Such fuel is reported to EPA as a batch of diesel
fuel under Sec. Sec. 80.593, 80.601, and 80.604.
(4) If previously designated motor vehicle diesel fuel having a
sulfur content of 15 ppm or less is blended with DTAB, and the combined
product after blending has a sulfur content that exceeds 15 ppm, the
importer entity, in its capacity as a refiner, must redesignate all the
diesel fuel as 500 ppm sulfur motor vehicle diesel fuel for purposes of
the temporary compliance option under Sec. 80.530, or other
permissible redesignation under Sec. 80.598. If #2D 15 ppm
sulfur motor vehicle diesel fuel is redesignated as #2D 500 ppm
sulfur motor vehicle diesel fuel, such entity must apply the volume of
previously designated 15 ppm sulfur diesel fuel, for purposes of its
operations as a distributor, to its
[[Page 39171]]
downgrading limitation under Sec. 80.527, if applicable, and for
volume balancing purposes under Sec. 80.599.
(5) As an alternative to paragraphs (e)(1) through (e)(4) of this
section, where an importer has a blending tank that is used only to
combine DTAB and blending components, and no previously designated
diesel fuel is added to the tank, the importer entity, in its capacity
as a refiner, may account for the diesel fuel produced in such a
blending tank by sampling and testing for the sulfur content of the
batch after DTAB and blendstock are added and mixed, and reporting the
volume of diesel fuel transferred from that tank to a different
facility, up to the point where a new blend is produced by adding new
DTAB and blendstock.
(f) The importer must include the volume and sulfur content of each
batch of DTAB in the annual importer reports to EPA, as prescribed
under Sec. Sec. 80.593, 80.601, and 80.604, but with a notation that
the batch is not included in the importer compliance calculations
because the product is DTAB. Any DTAB that ultimately is not used in
the importer's refinery operation (for example, a tank bottom of DTAB
at the conclusion of the refinery operation), must be treated as newly
imported diesel fuel, for which all required sampling and testing, and
recordkeeping must be accomplished, and included in the importer's
compliance calculations for the averaging period when this sampling and
testing occurs.
(g) The importer must retain records that reflect the importation,
sampling and testing, and physical movement of any DTAB, and must make
these records available to EPA on request.
? 16. A new Sec. 80.513 is added to read as follows:
Sec. 80.513 What provisions apply to transmix processing facilities?
For purposes of this section, transmix means a mixture of finished
fuels that no longer meets the specifications for a fuel that can be
used or sold without further processing. This section applies to
refineries that produce diesel fuel from transmix by distillation or
other refining processes but do not produce diesel fuel by processing
crude oil. This section only applies to the volume of diesel fuel
produced by such a transmix processor using these processes, and does
not apply to any diesel fuel produced by the blending of blendstocks.
(a) From June 1, 2006 through May 31, 2010, motor vehicle diesel
fuel produced by a transmix processor is subject to the 500 ppm sulfur
standard under Sec. 80.520(c).
(b) Beginning June 1, 2010, motor vehicle diesel fuel produced by a
transmix processor is subject to the sulfur standard under Sec.
80.520(a)(1).
(c) From June 1, 2007 through May 31, 2010, NRLM diesel fuel
produced by a transmix processor is exempt from the standards of Sec.
80.510(a). This paragraph (c) does not apply to NRLM diesel fuel that
is sold or intended for sale in the areas listed in Sec. 80.510(g)(1)
or (g)(2).
(d) From June 1, 2010 through May 31, 2014, NRLM diesel fuel
produced by a transmix processor is subject to the standards under
Sec. 80.510(a). This paragraph (d) does not apply to NRLM diesel fuel
that is sold or intended for sale in the areas listed in Sec.
80.510(g)(1) or (g)(2).
(e) From June 1, 2014 and beyond, NRLM diesel fuel produced by a
transmix processor is subject to the standards of Sec. 80.510(c),
except that LM diesel fuel is subject to the sulfur standard of Sec.
80.510(a). This paragraph (e) does not apply to NRLM or LM diesel fuel
that is sold or intended for sale in the areas listed in Sec.
80.510(g)(1) or (g)(2).
? 17. Section 80.520 is amended by revising paragraph (b) and removing
paragraph (d) to read as follows:
Sec. 80.520 What are the standards and dye requirements for motor
vehicle diesel fuel?
* * * * *
(b) Dye requirements. (1) All motor vehicle diesel fuel shall be
free of visible evidence of dye solvent red 164 (which has a
characteristic red color in diesel fuel), except for motor vehicle
diesel fuel that is used in a manner that is tax exempt under section
4082 of the Internal Revenue Code. All motor vehicle diesel fuel shall
be free of yellow solvent 124.
(2) Until June 1, 2010, any #1D or #2D distillate
fuel that does not show visible evidence of dye solvent red 164 shall
be considered to be motor vehicle diesel fuel and subject to all the
requirements of this subpart for motor vehicle diesel fuel, except for
distillate fuel designated or classified as any of the following:
(i) For use only in the State of Alaska, as provided under 40 CFR
69.51.
(ii) For use under a national security exemption under Sec. 80.606
or for use only in a research and development testing program exempted
under Sec. 80.607.
(iii) For use in the U.S. Territories as provided under Sec.
80.608.
(iv) Jet fuel meeting the definition under Sec. 80.2.
(v) Kerosene meeting the definition under Sec. 80.2.
(vi) Diesel fuel that is produced beginning June 1, 2006, with a
sulfur level less than or equal to 500 ppm, and designated as NRLM or
LM that has not yet been distributed from a truck loading terminal or
bulk terminal to a retail outlet, wholesale purchaser-consumer or
ultimate consumer.
* * * * *
? 18. Section 80.521 is revised to read as follows:
Sec. 80.521 What are the standards and identification requirements
for diesel fuel additives?
(a) Except as provided in paragraph (b) of this section, any diesel
fuel additive that is added to, intended for adding to, used in, or
offered for use in any MVNRLM diesel fuel subject to the 15 ppm sulfur
content standards of Sec. 80.510(b), Sec. 80.510(c), or Sec.
80.520(a) at any downstream location must--
(1) Have a sulfur content less than or equal to 15 ppm.
(2) Be accompanied by a product transfer document pursuant to Sec.
80.591 indicating that the additive complies with the 15 ppm sulfur
standard for diesel fuel, except for those diesel fuel additives which
are only sold in containers for use by the ultimate consumer of diesel
fuel and which are subject to the requirements of Sec. 80.591(d).
(b) Any diesel fuel additive that is added to, intended for adding
to, used in, or offered for use in diesel fuel subject to the 15 ppm
sulfur content standards of Sec. 80.510(b) or (c) or Sec. 80.520(a)
may have a sulfur content exceeding 15 ppm provided that each of the
following conditions are met:
(1) The additive is added to or used in the diesel fuel in a
quantity less than one percent by volume of the resultant additive/
diesel fuel mixture;
(2) The product transfer document complies with the informational
requirements of Sec. 80.591; and
(3) The additive is not used or intended for use by an ultimate
consumer in diesel motor vehicles or nonroad diesel engines.
? 19. Section 80.522 is revised to read as follows:
Sec. 80.522 May used motor oil be dispensed into diesel motor
vehicles or nonroad diesel engines?
No person may introduce used motor oil, or used motor oil blended
with diesel fuel, into the fuel system of model year 2007 or later
diesel motor vehicles or model year 2011 or later nonroad diesel
engines (not including locomotive or marine diesel engines), unless
both of the following requirements have been met:
(a) The vehicle or engine manufacturer has received a Certificate
[[Page 39172]]
of Conformity under 40 CFR part 86, 40 CFR part 89, or 40 CFR part 1039
and the certification of the vehicle or engine configuration is
explicitly based on emissions data with the addition of motor oil; and
(b) The oil is added in a manner and rate consistent with the
conditions of the Certificate of Conformity.
? 20. Section 80.523 is removed and reserved.
Sec. 80.523 [Removed and Reserved]
? 21. Section 80.527 is revised to read as follows:
Sec. 80.527 Under what conditions may motor vehicle diesel fuel
subject to the 15 ppm sulfur standard be downgraded to motor vehicle
diesel fuel subject to the 500 ppm sulfur standard?
(a) Definitions. As used in this section, downgrade means changing
the designation or classification of motor vehicle diesel fuel subject
to the 15 ppm sulfur standard under Sec. 80.520(a)(1) to motor vehicle
diesel fuel subject to the 500 ppm sulfur standard under Sec.
80.520(c). A downgrade occurs when the change in designation or
classification takes place. Changing the designation or classification
of motor vehicle diesel fuel subject to the 15 ppm sulfur standard
under Sec. 80.520(a)(1) to any designation or classification that is
not a motor vehicle diesel fuel is not a downgrade for purposes of this
section.
(b) Who is subject to the downgrade limitation: Any distributor,
retailer, or wholesale purchaser consumer that takes custody of any
diesel fuel designated or classified as #2D 15 ppm sulfur motor
vehicle diesel fuel and delivers any diesel fuel designated or
classified as #2D 500 ppm motor vehicle diesel fuel.
(c) Downgrading limitation. (1) Except as provided in paragraphs
(d) and (e) of this section, a person described in paragraph (b) of
this section may not downgrade a total of more than 20 percent of the
#2D motor vehicle diesel fuel (by volume) that is subject to
the 15 ppm sulfur standard of Sec. 80.520(a)(1) to #2D motor
vehicle diesel fuel subject to the sulfur standard of Sec. 80.520(c)
while such person has custody of such fuel.
(2) The limitation of paragraph (c)(1) of this section applies
separately to each facility as defined under Sec. 80.502 where there
is custody of the fuel when it is downgraded.
(3) Compliance with the limitation of paragraph (c)(1) of this
section applies separately for the compliance periods of October 1,
2006 through May 31, 2007; June 1, 2007 through June 30, 2008; July 1,
2008 through June 30, 2009; July 1, 2009 through May 31, 2010.
(4) Compliance with the limitation of paragraph (c)(1) of this
section shall be as calculated under Sec. 80.599(e).
(d) Diesel fuel in violation of the 15 ppm standard. Where motor
vehicle diesel fuel subject to the 15 ppm sulfur standard of Sec.
80.520(a)(1) is found to be in violation of any standard under Sec.
80.520(a) and is consequently downgraded to 500 ppm sulfur motor
vehicle diesel fuel, the person having custody of the fuel at the time
it is found to be in violation must include the volume of such
downgraded fuel toward its 20 percent volume limitation under paragraph
(c)(1) of this section, unless the person demonstrates that it did not
cause the violation.
(e) Special provisions for retail outlets and wholesale purchaser-
consumer facilities. Notwithstanding the provisions of paragraph (c)(1)
of this section, retailers and wholesale purchaser-consumers shall
comply with the downgrading limitation as follows:
(1) Retailers and wholesale purchaser-consumers who sell, offer for
sale, or dispense motor vehicle diesel fuel that is subject to the 15
ppm sulfur standard under Sec. 80.520(a)(1) are exempt from the volume
limitations of paragraph (c)(1) of this section.
(2) A retailer or wholesale purchaser-consumer who does not sell,
offer for sale, or dispense motor vehicle diesel fuel subject to the 15
ppm sulfur standard under Sec. 80.520(a)(1) must comply with the
downgrading limitations of paragraph (c) of this section, and
compliance shall be calculated as specified in Sec. 80.599(e)(2).
(f) Termination of downgrading limitations. The provisions of this
section shall not apply after May 31, 2010.
? 22. Section 80.530 is revised to read as follows:
Sec. 80.530 Under what conditions can 500 ppm motor vehicle diesel
fuel be produced or imported after May 31, 2006?
(a) Beginning June 1, 2006, a refiner or importer may produce or
import motor vehicle diesel fuel subject to the 500 ppm sulfur content
standard of Sec. 80.520(c) if all of the following requirements are met:
(1) Each batch of motor vehicle diesel fuel subject to the 500 ppm
sulfur content standard must be designated by the refiner or importer
as subject to such standard, pursuant to Sec. 80.598(a).
(2) The refiner or importer must meet the requirements for product
transfer documents in Sec. 80.590 for each batch subject to the 500
ppm sulfur content standard.
(3)(i) The volume of motor vehicle diesel fuel that is produced or
imported during a compliance period (V500, as provided in
paragraph (a)(5) of this section, may not exceed the following volume
limit:
(A) For the compliance periods prior to the period from July 1,
2009 through May 31, 2010, 20 percent of the volume of motor vehicle
diesel fuel that is produced or imported during a compliance period
(Vt) plus an additional volume of motor vehicle diesel fuel
represented by credits properly generated and used pursuant to the
requirements of Sec. Sec. 80.531 and 80.532.
(B) For the compliance period from July 1, 2009 through May 31,
2010, 20 percent of the volume of motor vehicle diesel fuel that is
produced or imported prior to January 1, 2010 during the compliance
period (Vt), plus an additional volume of motor vehicle
diesel fuel represented by credits properly generated and used pursuant
to the requirements of Sec. Sec. 80.531 and 80.532. From January 1,
2010 through May 31, 2010, the volume of motor vehicle diesel fuel that
is produced or imported shall not exceed the volume represented by
credits used pursuant to Sec. 80.532.
(ii) The terms V500 and Vt have the meaning
specified in Sec. 80.531(a)(2).
(4) Compliance with the volume limit in paragraph (a)(3) of this
section must be determined separately for each refinery. For an
importer, such compliance must be determined separately for each Credit
Trading Area (as defined in Sec. 80.531) into which motor vehicle
diesel fuel is imported. If a party is both a refiner and an importer,
such compliance shall be determined separately for the refining and
importation activities.
(5) Compliance with the volume limit in paragraph (a)(3) of this
section shall be determined on an annual basis, where the annual
compliance period is from July 1 through June 30. For the year 2006,
compliance shall be determined for the period June 1, 2006 through June
30, 2007. For the year 2010, compliance shall be determined for the
period of July 1, 2009 through May 31, 2010.
(6) Any motor vehicle diesel fuel produced or imported above the
volume limit in paragraph (a)(3) of this section shall be subject to
the 15 ppm sulfur content standard. However, for any compliance period
prior to the compliance period July 1, 2009 through May 31, 2010, a
refiner or importer may exceed the volume limit in paragraph (a)(3) of
this section by no more than 5 percent of the volume of diesel fuel
produced or imported during the compliance period (Vt),
provided that
[[Page 39173]]
for the immediately following compliance period:
(i) The refiner or importer complies with the volume limit in
paragraph (a)(3) of this section; and
(ii) The refiner or importer produces or imports a volume of motor
vehicle diesel fuel subject to the 15 ppm sulfur standard, or obtains
credits properly generated and used pursuant to the requirements of
Sec. Sec. 80.531 and 80.532 that represent a volume of motor vehicle
diesel fuel, equal to the volume of the exceedance for the prior
compliance period.
(b) After May 31, 2010, no refiner or importer may produce or
import motor vehicle diesel fuel subject to the 500 ppm sulfur content
standard pursuant to this section.
? 23. Section 80.531 is amended by revising paragraphs (a)(1), (a)(2),
(d)(1) (d)(5), (e)(1), and (e)(2)(i) to read as follows:
Sec. 80.531 How are motor vehicle diesel fuel credits generated?
(a) * * *
(1) A refiner or importer may generate credits during the period
June 1, 2006 through December 31, 2009, for motor vehicle diesel fuel
produced or imported that is designated as subject to the 15 ppm sulfur
content standard under Sec. 80.520(a)(1). Credits may be generated
only if the volume of motor vehicle diesel fuel designated under Sec.
80.598(a) as subject to the 15 ppm sulfur standard of Sec. 80.520(a)
exceeds 80 percent of the total volume of motor vehicle diesel fuel
produced or imported as described in paragraph (a)(2) of this section.
(2) The number of motor vehicle diesel fuel credits generated shall
be calculated for each compliance period (as specified in Sec.
80.530(a)(5)) as follows:
C = V1515-(0.80 x Vt)
Where:
C = the positive number of motor vehicle diesel fuel credits
generated, in gallons.
V15 = the total volume in gallons of diesel fuel produced
or imported that is designated under Sec. 80.598 as motor vehicle
diesel fuel and subject to the standards of Sec. 80.520(a) during
the compliance period.
Vt n =15 + V500.
V500 = the total volume in gallons of diesel fuel
produced or imported that is designated under Sec. 80.598(a) as
motor vehicle diesel fuel and subject to the 500 ppm sulfur standard
under Sec. 80.520(c) plus the total volume of any other diesel fuel
(not including V15, diesel fuel that is dyed in
accordance with Sec. 80.520(b) at the refinery or import facility
where the diesel fuel is produced or imported, or diesel fuel that
is designated as NRLM under Sec. 80.598(a)) represented as having a
sulfur content less than or equal to 500 ppm.
* * * * *
(d) * * *
(1) The designation requirements of Sec. 80.598, and all
recordkeeping and reporting requirements of Sec. Sec. 80.592, 80.593,
80.594, 80.600, and 80.601.
* * * * *
(5) In addition to the reporting requirements under paragraph
(d)(1) of this section, the refiner or importer must submit a report to
the Administrator no later than August 31, 2005 for the period from
June 1, 2004 through May 31, 2005, or August 31, 2006 for the period
from June 1, 2005 through May 31, 2006, demonstrating that all the
motor vehicle diesel fuel produced or imported for which credits were
generated met the applicable requirements of paragraph (b), (c), or
(d)(4) of this section. If the Administrator finds that such credits
did not in fact meet the requirements of paragraphs (b)(1) and (c)(1)
of this section, as applicable, or if the Administrator determines that
there is insufficient information to determine the validity of such
credits, the Administrator may deny the credits submitted in whole or
in part.
(e) * * *
(1) Notwithstanding the provisions of paragraph (a) of this
section, a small refiner that is approved by the EPA as a small refiner
under Sec. 80.551(g) may generate credits under Sec. 80.552(b). Such
a small refiner may generate one credit for each gallon of motor
vehicle diesel fuel produced that is designated under Sec. 80.598 as
motor vehicle diesel fuel subject to the 15 ppm sulfur standard under
Sec. 80.520(a)(1).
(2) * * *
(i) Credits may be generated under this paragraph (e) and Sec.
80.552(b) only during the compliance periods beginning June 1, 2006 and
ending on May 31, 2010, however diesel fuel produced after December 31,
2009 shall not generate credits. Credits shall be designated separately
by refinery, separately by CTA of generation, and separately by annual
compliance period. The annual compliance period for 2006 shall be June
1, 2006 through June 30, 2007. The annual compliance period for 2010
shall be July 1, 2009 through May 31, 2010.
* * * * *
? 24. Section 80.532 is revised to read as follows:
Sec. 80.532 How are motor vehicle diesel fuel credits used and
transferred?
(a) Credit use stipulations. Motor vehicle diesel fuel credits
generated under Sec. 80.531 may be used to meet the volume limit of
Sec. 80.530(a)(3) provided that:
(1) The motor vehicle diesel fuel credits were generated and
reported according to the requirements of this subpart; and
(2) The conditions of this section are met.
(b) Use of credits generated under Sec. 80.531. Motor vehicle
diesel fuel credits generated under Sec. 80.531 may be used by a
refiner or by an importer to comply with Sec. 80.530 by applying one
credit for every gallon of motor vehicle diesel fuel needed to meet
compliance with the volume limit of Sec. 80.530(a)(3).
(c) Credit banking. Motor vehicle diesel fuel credits generated may
be banked for use or transfer in a later compliance period or may be
transferred to another refiner or importer for use as provided in
paragraph (d) of this section.
(d) Credit transfers. (1) Motor vehicle diesel fuel credits
obtained from another refiner or from another importer, including early
motor vehicle diesel fuel credits and small refiner motor vehicle
diesel fuel credits as described in Sec. 80.531(b) through (e), may be
used to satisfy the volume limit of Sec. 80.530(a)(3) if all the
following conditions are met:
(i) The motor vehicle diesel fuel credits were generated in the
same CTA as the CTA in which motor vehicle diesel fuel credits are used
to achieve compliance;
(ii) The motor vehicle diesel fuel credits are used in compliance
with the time period limitations for credit use in this subpart;
(iii) Any credit transfer takes place no later than the August 31
following the compliance period when the motor vehicle diesel fuel
credits are used;
(iv) No credit may be transferred more than twice, as follows: The
first transfer by the refiner or importer who generated the credit may
only be made to a refiner or importer who intends to use the credit; if
the transferee cannot use the credit, it may make a second and final
transfer only to a refiner or importer who intends to use the credit.
In no case may a credit be transferred more than twice before being
used or terminated;
(v) The credit transferor must apply any motor vehicle diesel fuel
credits necessary to meet the transferor's annual compliance
requirements before transferring motor vehicle diesel fuel credits to
any other refinery or importer;
(vi) No motor vehicle diesel fuel credits may be transferred that
would result in the transferor having a negative credit balance; and
(vii) Each transferor must supply to the transferee records
indicating the year the motor vehicle diesel fuel
[[Page 39174]]
credits were generated, the identity of the refiner (and refinery) or
importer who generated the motor vehicle diesel fuel credits, the CTA
of credit generation, and the identity of the transferring entity, if
it is not the same entity who generated the motor vehicle diesel fuel
credits.
(2) In the case of motor vehicle diesel fuel credits that have been
calculated or created improperly, or are otherwise determined to be
invalid, the following provisions apply:
(i) Invalid motor vehicle diesel fuel credits cannot be used to
achieve compliance with the transferee's volume requirements regardless
of the transferee's good faith belief that the motor vehicle diesel
fuel credits were valid.
(ii) The refiner or importer who used the motor vehicle diesel fuel
credits, and any transferor of the motor vehicle diesel fuel credits,
must adjust their credit records, reports and compliance calculations
as necessary to reflect the proper motor vehicle diesel fuel credits.
(iii) Any properly created motor vehicle diesel fuel credits
existing in the transferor's credit balance after correcting the credit
balance, and after the transferor applies motor vehicle diesel fuel
credits as needed to meet the compliance requirements at the end of the
compliance period, must first be applied to correct the invalid
transfers before the transferor trades or banks the motor vehicle
diesel fuel credits.
(e) Limitations on credit use. (1) Motor vehicle diesel fuel
credits may not be used to achieve compliance with any requirements of
this subpart other than the volume limit of Sec. 80.530(a)(3), unless
specifically approved by the Administrator pursuant to a hardship
relief petition under Sec. 80.560 or 80.561.
(2) A refiner or importer possessing motor vehicle diesel fuel
credits must use all motor vehicle diesel fuel credits in its
possession prior to applying the credit deficit provisions of Sec.
80.530(a)(6).
(3) No motor vehicle diesel fuel credits may be used to meet
compliance with this subpart subsequent to the compliance period ending
May 31, 2010.
? 25. A new Sec. 80.533 is added to read as follows:
Sec. 80.533 How does a refiner or importer apply for a motor vehicle
or non-highway baseline?
(a) A refiner or importer wishing to generate credits under Sec.
80.535 or use the small refiner provisions under Sec. 80.554 must
submit an application to EPA that includes the information required
under paragraph (c) of this section by the dates specified in paragraph
(f) of this section. A refiner must apply for a motor vehicle baseline
for each refinery in order to generate credits under Sec. 80.535 and
apply for a non-highway baseline for each refinery to use the
provisions of Sec. 80.554 (a), (b), or (d).
(b) The baseline must be sent to the following address: U.S. EPA--
Attn: Nonroad Rule Diesel Fuel Baseline, Transportation and Regional
Programs Division (6406J), 1200 Pennsylvania Avenue, NW., Washington,
DC 20460 (regular mail) or U.S. EPA, Attn: Nonroad Rule Diesel Fuel
Baseline, Transportation and Regional Programs Division (6406J), 1310 L
Street, NW., 6th floor, Washington, DC 20005 (express mail).
(c) A baseline application must be submitted for each refinery or
import facility and include the following information:
(1) A listing of the names and addresses of all refineries or
import facilities owned by the company for which the refiner or
importer is applying for a motor vehicle or non-highway baseline.
(2)(i) For purposes of a motor vehicle baseline volume for use in
determining early credits per Sec. 80.535(a) and (b) and for purposes
of a non-highway baseline volume used in determining compliance with
the provisions of Sec. 80.554(a) or (d), the baseline volume produced
during the three calendar years beginning January 1, 2003, 2004, and
2005, as calculated under paragraph (e)(1) of this section.
(ii) For purposes of a motor vehicle baseline volume for use in
determining early credits per Sec. 80.535(c) and for purposes of a
non-highway baseline volume used in determining compliance with the
provisions of Sec. 80.554(b), the baseline volumes produced during the
three calendar years beginning January 1, 2006, 2007, and 2008, as
calculated under paragraph (e)(2) of this section.
(3) A letter signed by the president, chief operating officer of
the company, or his/her delegate, stating that the information
contained in the motor vehicle or non-highway baseline application is
true to the best of his/her knowledge.
(4) Name, address, phone number, facsimile number and e-mail
address of a corporate contact person.
(5) For each batch of diesel fuel produced or imported during each
calendar year:
(i) The date that production was completed or importation occurred
for the batch and the batch designation or classification.
(ii) The batch volume.
(6) Other appropriate information as requested by EPA.
(d) Calculation of the Motor vehicle Baseline, BMV. (1)
Under paragraph (c)(2)(i) of this section, BMV equals the
average annual volume of motor vehicle diesel fuel produced or imported
from January 1, 2003 through December 31, 2005.
(2) Under paragraph (c)(2)(ii) of this section, BMV
equals the average annual volume of motor vehicle diesel fuel produced
during the period from January 1, 2006 through December 31, 2008.
(3) For purposes of this paragraph, fuel produced for export, jet
fuel (kerosene), and fuel specifically produced to meet military
specifications (such as JP-4, JP-8, and F-76), shall not be included in
baseline calculations.
(e) Calculation of the Non-highway Baseline, BNRLM. (1)
Under paragraph (c)(2)(i) of this section, BNRLM equals the
average annual volume of all #2D distillate produced or
imported from January 1, 2003 through December 31, 2005, less
BMV as determined in paragraph (d)(1) of this section.
(2) Under paragraph (c)(2)(ii) of this section, NRLM
equals the average annual volume of MVNRLM produced or imported from
January 1, 2006 through December 31, 2008, less BMV as
determined in paragraph (d)(2) of this section.
(3) For purposes of this paragraph (e), fuel produced for export,
jet fuel, kerosene, and fuel specifically produced to meet military
specification (such as JP-4, JP-8, and F-76), shall not be included in
baseline calculations.
(f)(1) Applications submitted under paragraph (c)(2)(i) of this
section must be postmarked by February 28, 2006.
(2) Applications submitted under paragraph (c)(2)(ii) of this
section must be postmarked by February 28, 2009.
(g)(1) For applications submitted under paragraph (c)(2)(i) of this
section, EPA will notify refiners or importers by June 1, 2006 of
approval of the baselines for each of the refiner's refineries or
importer's import facilities or of any deficiencies in the refiner's or
importer's application.
(2) For applications submitted under paragraph (c)(2)(ii) of this
section, EPA will notify refiners or importers by June 1, 2009
regarding approval of the baselines for each of the refiner's
refineries or importer's import facilities of any deficiencies in the
refiner's or importer's application.
(h) If at any time the motor vehicle baseline or non-highway
baseline submitted in accordance with the requirements of this section
is determined to be incorrect, EPA will
[[Page 39175]]
notify the refiner or importer of the corrected baseline and any
compliance calculations made on the basis of that baseline will have to
be adjusted retroactively.
? 26. A new Sec. 80.535 is added to read as follows.
Sec. 80.535 How are NRLM diesel fuel credits generated?
(a) Generation of high sulfur NRLM credits from June 1, 2006
through May 31, 2007. (1) During the period June 1, 2006 through May
31, 2007, a refiner or importer may generate credits pursuant to the
provisions of this section if all of the following conditions are met:
(i) The refiner or importer notifies EPA of its intention to
generate credits and the period during which it will generate credits.
This notification must be received by EPA at least 120 calendar days
prior to the date it begins generating credits under this section.
(ii) Each batch or partial batch of NRLM diesel fuel for which
credits are claimed shall be subject to all of the provisions of this
subpart for NRLM diesel fuel as if it had been produced after June 1,
2007 and before June 1, 2010.
(iii) The number of high-sulfur NRLM credits (HSC) that are
generated shall be a positive number.
(2) The refiner or importer shall choose one of the following
methods for calculating credits for each calculation period.
(i) For fuel that is dyed under the provisions of Sec. 80.520, HSC
equals the volume of fuel in gallons produced or imported during the
period identified in paragraph (a)(1) of this section that is
designated as NRLM diesel fuel and that is subject to and complies with
the provisions of Sec. 80.510(a); or
(ii) For dyed or undyed fuel that complies with the provisions of
Sec. 80.598 for a calculation period of June 1, 2006 through May 31,
2007, determine HSC as follows:
HSC = V510 + V520 - BMV
Where:
V510 = The total volume of NRLM diesel fuel produced or
imported during the annual calculation period that complies with the
standards of Sec. 80.510(a) or (b).
V520 = The total volume of motor vehicle diesel fuel
produced or imported during the annual calculation period that
complies with the standards of Sec. 80.520(a) or (c).
BMV = As calculated in Sec. 80.533(d)(1).
(3) High-sulfur NRLM credits shall be generated and designated as
follows:
(i) Credits shall be generated separately for each refiner or
importer.
(ii) Credits may not be generated by both a foreign refiner and by
an importer for the same motor vehicle diesel fuel.
(iii) Credits shall not be generated under both Sec. 80.531 and
this section for the same diesel fuel.
(iv) Any credits generated by a foreign refiner shall be generated
as provided in Sec. 80.620(c) and this section.
(4) No credits may be generated under this paragraph (a) after May
31, 2007.
(5) Any fuel for which a refiner or importer wishes to generate
credits must be designated as 500 ppm sulfur NRLM diesel fuel when
delivered to the next entity. The refiner may not designate the fuel as
500 ppm sulfur with the intent that it be mixed by the next entity with
a batch of distillate with a higher sulfur level to create a fuel with
a classification other than 500 ppm sulfur or the classification of the
fuel it is mixed with (e.g., it cannot mix fuel designated as 500 ppm
sulfur with fuel classified as high sulfur to produce a fuel classified
as 2000 ppm sulfur to meet state or local sulfur limits).
(6) The refiner or importer must submit a report to the
Administrator no later than July 31, 2007. The report must demonstrate
that all the NRLM diesel fuel produced or imported which generated
credits met the applicable requirements of paragraphs (a)(1) through
(a)(5) of this section. If the Administrator finds that such credits
did not in fact meet the requirements of paragraphs (a)(1) through
(a)(5) of this section, as applicable, or if the Administrator
determines that there is insufficient information to determine the
validity of such credits, the Administrator may deny the credits
submitted in whole or in part.
(b) Generation of high-sulfur NRLM credits by small refiners from
June 1, 2006 through May 31, 2010. (1) Notwithstanding the dates
specified in paragraph (a) of this section, during the period from June
1, 2006 through May 31, 2010, a refiner that is approved by the EPA as
a small refiner under Sec. 80.551 may generate credits under paragraph
(a) of this section during any compliance period as specified under
Sec. 80.599(a)(2) for diesel fuel produced or imported that is
designated as NRLM diesel fuel and complies with the provisions of
Sec. 80.510(a).
(2) The small refiner must submit a report to the Administrator no
later than August 31 after the end of each calculation period during
which credits were generated. The report must demonstrate that all the
NRLM diesel fuel produced or imported which generated credits met the
applicable requirements of paragraphs (a)(1) through (a)(5) of this
section. If the Administrator finds that such credits did not in fact
meet the requirements of paragraphs (a)(1) through (a)(5) of this
section, as applicable, or if the Administrator determines that there
is insufficient information to determine the validity of such credits,
the Administrator may deny the credits submitted in whole or in part.
(3) In addition, a foreign refiner that is approved by the
Administrator to generate credits under Sec. 80.554 shall comply with
the requirements of Sec. 80.620.
(c) Generation of 500 ppm sulfur NRLM credits from June 1, 2009
through May 31, 2010. (1) During the period of June 1, 2009 through May
31, 2010, a refiner or importer may generate credits pursuant to the
provisions of this section if all of the following conditions are met:
(i) The refiner or importer notifies EPA of its intention to
generate credits and the period during which it will generate credits.
This notification must be received by EPA at least 120 calendar days
prior to the date it begins generating credits under this section.
(ii) Each batch or partial batch of NRLM diesel fuel for which
credits are claimed shall be subject to all of the provisions of this
subpart for NRLM diesel fuel as if it had been produced after June 1, 2010.
(iii) The number of 500 ppm sulfur NRLM credits in gallons that are
generated, C500, shall be a positive number calculated as
follows:
C500 = V15-BMV
Where:
V15 = The total volume in gallons of 15 ppm diesel fuel
produced or imported during the period stated under paragraph
(c)(1)(i) of this section that is designated as either motor vehicle
diesel fuel or NRLM diesel fuel.
BMV = As determined in Sec. 80.533(d)(2).
(2) 500 ppm sulfur NRLM credits shall be generated and designated
as follows:
(i) Credits shall be generated separately for each refiner or importer.
(ii) Credits may not be generated by both a foreign refiner and by
an importer for the same diesel fuel.
(iii) Credits shall not be generated under both Sec. 80.531 and
this section for the same diesel fuel.
(iv) Any credits generated by a foreign refiner shall be generated
as provided in Sec. 80.620(c) and this section.
(3) No credits may be generated under this paragraph (c) after May
31, 2010.
(4) The refiner or importer must submit a report to the
Administrator no later than August 31, 2010. The report must
demonstrate that all the 15 ppm sulfur NRLM diesel fuel produced or
imported which generated credits met
[[Page 39176]]
the applicable requirements of paragraphs (c)(1) through (c)(3) of this
section. If the Administrator finds that such credits did not in fact
meet the requirements of paragraphs (c)(1) through (c)(3) of this
section, as applicable, or if the Administrator determines that there
is insufficient information to determine the validity of such credits,
the Administrator may deny the credits submitted in whole or in part.
(d) Generation of 500 ppm sulfur NRLM credits by small refiners
from June 1, 2009 through December 31, 2013. (1) Notwithstanding the
dates specified in paragraph (c) of this section, during the period
from June 1, 2009 through December 31, 2013, a refiner that is approved
by the EPA as a small refiner under Sec. 80.551 may generate credits
under paragraph (c) of this section during any compliance period as
specified under Sec. 80.599(a)(2) for diesel fuel produced or imported
that is designated as NR or NRLM diesel fuel and complies with the
provisions of Sec. 80.510(b) or (c).
(2) The small refiner must submit a report to the Administrator no
later than August 31 after the end of each calculation period during
which credits were generated. The report must demonstrate that all the
15 ppm sulfur NR or NRLM diesel fuel produced or imported for which
credits were generated met the applicable requirements of paragraphs
(c)(1) through (c)(3) of this section. If the Administrator finds that
such credits did not in fact meet the requirements of paragraphs (c)(1)
through (c)(3) of this section, as applicable, or if the Administrator
determines that there is insufficient information to determine the
validity of such credits, the Administrator may deny the credits
submitted in whole or in part.
(3) In addition, a foreign refiner that is approved by the
Administrator to generate credits under Sec. 80.554 shall comply with
the requirements of Sec. 80.620.
? 27. A new Sec. 80.536 is added to read as follows:
Sec. 80.536 How are NRLM diesel fuel credits used and transferred?
(a) Credit use stipulations. Credits generated under Sec.
80.535(a) and (b) may be used to meet the NRLM diesel fuel sulfur
standard of Sec. 80.510(a), and credits generated under 80.535(c) and
(d) may be used to meet the NR and NRLM diesel fuel sulfur standard of
80.510(b) and (c), respectively, provided that:
(1) The credits were generated and reported according to the
requirements of this subpart; and
(2) The conditions of this section are met.
(b) Using credits generated under Sec. 80.535. Credits generated
under Sec. 80.535 may be used by a refiner or an importer to comply
with the diesel fuel standards of Sec. 80.510 (a), (b), and (c) by
applying one credit for every gallon of diesel fuel that does not
comply with the applicable standard.
(c) Credit banking. Credits generated may be banked for use at a
later time or may be transferred to any other refiner or importer
nationwide for use as provided in paragraph (d) of this section.
(d) Credit transfers. (1) Credits generated under Sec. 80.535 that
are obtained from another refiner or importer may be used to comply
with the diesel fuel sulfur standards of Sec. 80.510(a), (b), and (c)
if all the following conditions are met:
(i) The credits are used in compliance with the time period
limitations for credit use in this subpart;
(ii) Any credit transfer is completed no later than August 31
following the compliance period when the credits are used to comply
with a standard under paragraph (a) of this section;
(iii) No credit is transferred more than twice, as follows:
(A) The first transfer by the refiner or importer who generated the
credit may only be made to a refiner or importer that intends to use
the credit; if the transferee cannot use the credit, it may make a
second and final transfer only to a refiner or importer who intends to
use the credit; and
(B) In no case may a credit be transferred more than twice before
it is used or it expires;
(iv) The credit transferor applies any credits necessary to meet
the transferor's annual compliance requirements before transferring
credits to any other refinery or importer;
(v) No credits are transferred that would result in the transferor
having a negative credit balance; and
(vi) Each transferor supplies to the transferee records indicating
the year the credits were generated, the identity of the refiner (and
refinery) or importer that generated the credits, and the identity of
the transferor, if it is not the same party that generated the credits.
(2) In the case of credits that have been calculated or created
improperly, or are otherwise determined to be invalid, the following
provisions apply:
(i) Invalid credits cannot be used to achieve compliance with the
transferee's volume requirements regardless of the transferee's good
faith belief that the credits were valid.
(ii) The refiner or importer that used the credits, and any
transferor of the credits, must adjust its credit records, reports and
compliance calculations as necessary to reflect the proper credits.
(iii) Any properly created credits existing in the transferor's
credit balance after correcting the credit balance, and after the
transferor applies credits as needed to meet the compliance
requirements at the end of the calendar year, must first be applied to
correct the invalid transfers before the transferor trades or banks the
credits.
(e) General limitation on credit use. Credits may not be used to
achieve compliance with any requirements of this subpart other than the
standards of Sec. 80.510(a), (b), and (c), unless specifically
approved by the Administrator pursuant to a hardship relief petition
under Sec. 80.560 or Sec. 80.561.
(f) Use of high sulfur NRLM credits. (1) High sulfur NRLM credits
generated under Sec. 80.535(a) or (b) may be used on a one-for-one
basis to meet the NRLM diesel fuel sulfur standard of Sec. 80.510(a)
from June 1, 2007 through May 31, 2010. For example, one credit
generated by the production or importation of one gallon of NRLM diesel
fuel subject to the NRLM diesel fuel sulfur standard of Sec. 80.510
(a) may be used to produce or import one gallon of NRLM diesel fuel
that is exempt from the sulfur standard of Sec. 80.510(a) during the
period from June 1, 2007 through May 31, 2010.
(2) Any high sulfur NRLM diesel fuel produced after June 1, 2007
through the use of credits must--
(i) Be dyed red under the provisions of Sec. 80.520 at the point
of production or importation;
(ii) Be associated with a product transfer document that bears a
unique product code as specified in Sec. 80.590; and
(iii) Not be used to sell or deliver diesel fuel into areas
specified in Sec. 80.510(g)(1) or (g)(2).
(3) No high sulfur NRLM credits may be used subsequent to the
compliance period ending May 31, 2010.
(4) Any high sulfur NRLM credits not used under the provisions of
paragraph (f)(1) of this section may be converted into 500 ppm sulfur
NRLM credits on a one-for-one basis for use under paragraph (g) of this
section.
(g) Use of 500 ppm sulfur NRLM credits. (1) 500 ppm sulfur NRLM
credits generated under Sec. 80.535(c) or (d) or converted from high
sulfur NRLM credits under paragraph (f)(3) of this section may be used
on a one-for-one basis to meet the NR or NRLM diesel
[[Page 39177]]
fuel sulfur standards of Sec. 80.510(b) or (c) from June 1, 2010
through May 31, 2014. For example, one credit generated by the
production or importation of one gallon of NRLM diesel fuel subject to
the NRLM diesel fuel sulfur standard of Sec. 80.510 (c) may be used to
produce or import one gallon of NR diesel fuel that is subject to the
sulfur standard of Sec. 80.510(a) during the period from June 1, 2010
through May 31, 2014.
(2) Any 500 ppm sulfur NR or NRLM diesel fuel produced or imported
after June 1, 2010 through the use of these credits must--
(i) Bear a unique product code as specified in Sec. 80.590; and
(ii) Not be used to sell or deliver diesel fuel into areas
specified in Sec. 80.510(g)(1) or (g)(2).
(3) No 500 ppm sulfur NRLM credits may be used after May 31, 2014.
? 28. Section 80.540 is amended by revising paragraphs (b), (d), (e), and
(f) to read as follows:
Sec. 80.540 How may a refiner be approved to produce gasoline under
the GPA gasoline sulfur standards in 2007 and 2008?
* * * * *
(b) The refiner must submit an application in accordance with the
provisions of Sec. Sec. 80.595 and 80.596. The application must also
include information, as provided in Sec. 80.594(c), demonstrating that
starting no later than June 1, 2006, 95 percent of the motor vehicle
diesel fuel produced by the refinery for United States use will comply
with the 15 ppm sulfur standard under Sec. 80.520(a)(1), and that the
volume of motor vehicle diesel fuel produced will comply with the
volume requirements of paragraph (e) of this section.
* * * * *
(d) From June 1, 2006 through December 31, 2008, 95 percent of the
motor vehicle diesel fuel produced by a refiner that has been approved
under paragraph (c) of this section to produce gasoline subject to the
GPA gasoline sulfur standards in 2007 and 2008, must be accurately
designated under Sec. 80.598 as meeting the 15 ppm sulfur standard of
Sec. 80.520(a)(1).
(e) The total volume of motor vehicle diesel fuel produced for use
in the United States and designated as meeting the 15 ppm sulfur
standard under paragraph (d) of this section must meet or exceed 85
percent of the baseline volume established under paragraph (c) of this
section, except that for the first compliance period from June 1, 2006
through June 30, 2007, the total volume must meet or exceed 92 percent
of the baseline volume.
(f) Compliance with the volume requirements in paragraph (e) of
this section shall be determined each compliance period. Annual
compliance periods shall be from July 1 through June 30. For the year
2006, the compliance period shall be from June 1, 2006 through June 30,
2007.
* * * * *
? 29. Section 80.550 is amended by revising the section heading and
paragraphs (a), (b), (c), (d), (e) and (f) to read as follows:
Sec. 80.550 What is the definition of a motor vehicle diesel fuel
small refiner or a NRLM diesel fuel small refiner under this subpart?
(a) A motor vehicle diesel fuel small refiner is defined as any
person, as defined by 42 U.S.C. 7602(e), who--
(1) Produces diesel fuel at a refinery by processing crude oil
through refinery processing units; and
(2) Employed an average of no more than 1,500 people, based on the
average number of employees for all pay periods from January 1, 1999,
to January 1, 2000; and
(3) Had an average crude oil capacity less than or equal to 155,000
barrels per calendar day (bpcd) for 1999; or
(4) Has been approved by EPA as a small refiner under Sec. 80.235
and continues to meet the criteria of a small refiner under Sec.
80.225.
(b) A NRLM diesel fuel small refiner is defined as any person, as
defined by 42 U.S.C. 7602(e), who--
(1) Produces diesel fuel at a refinery by processing crude oil
through refinery processing units;
(2) Employed an average of no more than 1,500 people, based on the
average number of employees for all pay periods from January 1, 2002,
to January 1, 2003; and
(3) Had an average crude oil capacity less than or equal to 155,000
barrels per calendar day (bpcd) for 2003.
(c) Determine the number of employees and crude oil capacity under
paragraphs (a) or (b) of this section, as follows:
(1) The refiner shall include the employees and crude oil capacity
of any subsidiary companies, any parent company and subsidiaries of the
parent company in which the parent has 50 percent or greater ownership,
and any joint venture partners.
(2) For any refiner owned by a governmental entity, the number of
employees and total crude oil capacity as specified in paragraph (a) of
this section shall include all employees and crude oil production of
the government to which the governmental entity is a part.
(3) Any refiner owned and controlled by an Alaska Regional or
Village Corporation organized pursuant to the Alaska Native Claims
Settlement Act (43 U.S.C. 1601) is not considered an affiliate of such
entity, or with other concerns owned by such entity solely because of
their common ownership.
(d)(1) Notwithstanding the provisions of paragraph (a) of this
section, a refiner that acquires or reactivates a refinery that was
shut down or non-operational between January 1, 1999, and January 1,
2000, may apply for motor vehicle diesel fuel small refiner status in
accordance with the provisions of Sec. 80.551(c)(1)(ii).
(2) Notwithstanding the provisions of paragraph (b) of this
section, a refiner that acquires or reactivates a refinery that was
shutdown or non-operational between January 1, 2002, and January 1,
2003, may apply for NRLM diesel fuel small refiner status in accordance
with the provisions of Sec. 80.551(c)(2)(ii).
(e) The following are ineligible for the small refiner provisions:
(1)(i) For motor vehicle diesel fuel, refiners with refineries
built or started up after January 1, 2000.
(ii) For NRLM diesel fuel, refiners with refineries built or
started up after January 1, 2003.
(2)(i) For motor vehicle diesel fuel, persons who exceed the
employee or crude oil capacity criteria under this section on January
1, 2000, but who meet these criteria after that date, regardless of
whether the reduction in employees or crude oil capacity is due to
operational changes at the refinery or a company sale or
reorganization.
(ii) For NRLM diesel fuel, persons who exceed the employee or crude
oil capacity criteria under this section on January 1, 2003, but who
meet these criteria after that date, regardless of whether the
reduction in employees or crude oil capacity is due to operational
changes at the refinery or a company sale or reorganization.
(3) Importers.
(4) Refiners who produce motor vehicle diesel fuel or NRLM diesel
fuel other than by processing crude oil through refinery processing
units.
(f)(1)(i) Refiners who qualify as motor vehicle diesel fuel small
refiners under this section and subsequently cease production of diesel
fuel from processing crude oil through refinery processing units, or
employ more than 1,500 people or exceed the 155,000 bpcd crude oil
capacity limit after January 1, 2004 as a result of merger with or
acquisition of or by another entity, are disqualified as small
refiners, except as provided for under paragraph (f)(4) of this
section. If disqualification occurs, the refiner shall notify EPA in
[[Page 39178]]
writing no later than 20 days following this disqualifying event.
(ii) Except as provided under paragraph (f)(3) of this section, any
refiner whose status changes under this paragraph shall meet the
applicable standards of Sec. 80.520 within a period of up to 30 months
from the disqualifying event for any of its refineries that were
previously subject to the small refiner standards of Sec. 80.552, but
no later than the May 31, 2010.
(2)(i) Refiners who qualify as NRLM diesel fuel small refiners
under this section and subsequently cease production of diesel fuel
from crude oil, or employ more than 1,500 people or exceed the 155,000
bpcd crude oil capacity limit after January 1, 2004 as a result of
merger with or acquisition of or by another entity, are disqualified as
small refiners, except as provided for under paragraph (f)(4) of this
section. If disqualification occurs, the refiner shall notify EPA in
writing no later than 20 days following this disqualifying event.
(ii) Except as provided under paragraph (f)(3) of this section, any
refiner whose status changes under this paragraph shall meet the
applicable standards of Sec. 80.510 within a period of up to 30 months
of the disqualifying event for any of its refineries that were
previously subject to the small refiner standards of Sec. 80.552, but
no later than the dates specified in Sec. 80.554(a) or (b), as
applicable.
(3) A refiner may apply to EPA for up to an additional six months
to comply with the standards of Sec. 80.510 or Sec. 80.520 if more
than 30 months would be required for the necessary engineering,
permitting, construction, and start-up work to be completed. Such
applications must include detailed technical information supporting the
need for additional time. EPA will base a decision to approve
additional time on information provided by the refiner and on other
relevant information. In no case will EPA extend the compliance date
beyond May 31, 2010 for a motor vehicle diesel fuel small refiner or
beyond the dates specified in Sec. 80.554(a) or (b), as applicable,
for a NRLM diesel fuel small refiner.
(4) Disqualification under paragraphs (f)(1) or (f)(2) of this
section shall not apply in the case of a merger between two previously
approved small refiners.
(5) During the period of time up to 30 months provided under
paragraph (f)(1)(ii) of this section, and any extension provided under
paragraph (f)(3) of this section, the refiner may not generate motor
vehicle diesel fuel sulfur credits under Sec. 80.531(e). During the
period of time up to 30 months provided under paragraph (f)(2)(ii) of
this section, and any extension provided under paragraph (f)(3) of this
section, the refiner may not generate NRLM diesel fuel sulfur credits
under Sec. 80.535(b) or (d).
* * * * *
? 30. Section 80.551 is revised to read as follows:
Sec. 80.551 How does a refiner obtain approval as a small refiner
under this subpart?
(a)(1)(i) Applications for motor vehicle diesel fuel small refiner
status must be submitted to EPA by December 31, 2001.
(ii) Applications for NRLM diesel fuel small refiner status must be
submitted to EPA by December 31, 2004.
(2)(i) In the case of a refiner who acquires or reactivates a
refinery that was shutdown or non-operational between January 1, 1999,
and January 1, 2000, the application for motor vehicle diesel fuel
small refiner status must be submitted to EPA by June 1, 2003.
(ii) In the case of a refiner who acquires or reactivates a
refinery that was shutdown or non-operational between January 1, 2002,
and January 1, 2003, the application for NRLM diesel fuel small refiner
status must be submitted to EPA by June 1, 2006.
(b) Applications for small refiner status must be sent via
certified mail with return receipt or express mail with return receipt
to: U.S. EPA--Attn: Diesel Small Refiner Status (6406J), 1200
Pennsylvania Avenue, NW., Washington, DC 20460 (certified mail/return
receipt) or Attn: Diesel Small Refiner Status, Transportation and
Regional Programs Division, 1310 L Street, NW., 6th floor, Washington,
DC 20005 (express mail/return receipt).
(c) The small refiner status application must contain the following
information for the company seeking small refiner status, plus any
subsidiary companies, any parent company and subsidiaries of the parent
company in which the parent has 50 percent or greater ownership, and
any joint venture partners:
(1) For motor vehicle diesel fuel small refiners--
(i) A listing of the name and address of each location where any
employee worked during the 12 months preceding January 1, 2000; the
average number of employees at each location based upon the number of
employees for each pay period for the 12 months preceding January 1,
2000; and the type of business activities carried out at each location;
or
(ii) In the case of a refiner who acquires or reactivates a
refinery that was shutdown or non-operational between January 1, 1999,
and January 1, 2000, a listing of the name and address of each location
where any employee of the refiner worked since the refiner acquired or
reactivated the refinery; the average number of employees at any such
acquired or reactivated refinery during each calendar year since the
refiner acquired or reactivated the refinery; and the type of business
activities carried out at each location.
(2) For NRLM diesel fuel small refiners--
(i) A listing of the name and address of each location where any
employee worked during the 12 months preceding January 1, 2003; the
average number of employees at each location based upon the number of
employees for each pay period for the 12 months preceding January 1,
2003; and the type of business activities carried out at each location;
or
(ii) In the case of a refiner who acquires or reactivates a
refinery that was shutdown or non-operational between January 1, 2002,
and January 1, 2003, a listing of the name and address of each location
where any employee of the refiner worked since the refiner acquired or
reactivated the refinery; the average number of employees at any such
acquired or reactivated refinery during each calendar year since the
refiner acquired or reactivated the refinery; and the type of business
activities carried out at each location.
(3) The total corporate crude oil capacity of each refinery as
reported to the Energy Information Administration (EIA) of the U.S.
Department of Energy (DOE) for the most recent 12 months of operation.
The information submitted to EIA is presumed to be correct. In cases
where a company disagrees with this information, the company may
petition EPA with appropriate data to correct the record when the
company submits its application for small refiner status. EPA may
accept such alternate data at its discretion.
(4) For motor vehicle diesel fuel, an indication of whether the
refiner, for each refinery, is applying for--
(i) The ability to produce motor vehicle diesel fuel subject to the
500 ppm sulfur standard under Sec. 80.520(c) or generate credits under
Sec. 80.531, pursuant to the provisions of Sec. 80.552(a) or (b); or
(ii) An extension of the duration of its small refiner gasoline
sulfur standard under Sec. 80.553, pursuant to the provisions of Sec.
80.552(c).
(5) For NRLM diesel fuel, an indication of whether the refiner, for
each refinery, is applying for--
(i) The ability to delay compliance under Sec. 80.554(a) or (b),
or to generate
[[Page 39179]]
NRLM diesel sulfur credits under Sec. 80.535(b) or (d), pursuant to
the provisions of Sec. 80.554(c); or
(ii) An adjustment to its small refiner gasoline sulfur standards
under Sec. 80.240(a), pursuant to the provisions of Sec. 80.554(d).
(6) A letter signed by the president, chief operating or chief
executive officer of the company, or his/her designee, stating that the
information contained in the application is true to the best of his/her
knowledge.
(7) Name, address, phone number, facsimile number and e-mail
address (if available) of a corporate contact person.
(d) For joint ventures, the total number of employees includes the
combined employee count of all corporate entities in the venture.
(e) For government-owned refiners, the total employee count
includes all government employees.
(f) Approval of small refiner status for refiners who apply under
Sec. 80.550(e) will be based on all information submitted under
paragraph (c) of this section, except as provided in Sec. 80.550(e).
(g) EPA will notify a refiner of approval or disapproval of small
refiner status by letter. If disapproved, the refiner must comply with
the sulfur standards in Sec. 80.510 or 80.520, as appropriate, except
as otherwise provided in this subpart.
(h) If EPA finds that a refiner provided false or inaccurate
information on its application for small refiner status, upon notice
from EPA the refiner's small refiner status will be void ab initio.
(i) Upon notification to EPA, an approved small refiner may
withdraw its status as a small refiner. Effective on January 1 of the
year following such notification, the small refiner will become subject
to the sulfur standards in Sec. 80.510 or 80.520, as appropriate,
unless one of the other hardship provisions of this subpart apply.
? 31. Section 80.552 is amended by revising the section heading and
paragraphs (a), (b), (c), and (e) to read as follows:
Sec. 80.552 What compliance options are available to motor vehicle
diesel fuel small refiners?
(a) A refiner that has been approved by EPA as a motor vehicle
diesel fuel small refiner under Sec. 80.551(g) may produce motor
vehicle diesel fuel subject to the 500 ppm sulfur standard pursuant to
the provisions of Sec. 80.530, except that the volume limits of Sec.
80.530(a)(3) shall only apply to that volume of diesel fuel that is
produced or imported during an annual compliance period that exceeds
105 percent of the baseline volume established under Sec. 80.595
(V500). The annual compliance period shall be from July 1
through June 30. For the year 2006, the compliance period shall be from
June 1, 2006 through June 30, 2007, and the volume limits shall only
apply to that volume V500 that exceeds 113 percent of the
baseline volume.
(b) A refiner that has been approved by EPA as a motor vehicle
diesel fuel small refiner under Sec. 80.551(g) may generate motor
vehicle diesel fuel credits pursuant to the provisions of Sec. 80.531,
except that for purposes of Sec. 80.531(a), the term ``Credit'' shall
equal V15, without further adjustment.
(c) A refiner that has been approved by EPA as a motor vehicle
diesel fuel small refiner under Sec. 80.551(g) may apply for an
extension of the duration of its small refiner gasoline sulfur
standards pursuant to Sec. 80.553.
* * * * *
(e) The provisions of this section shall apply separately for each
refinery owned or operated by a motor vehicle diesel fuel small refiner.
? 32. Section 80.553 is amended by revising paragraphs (d), (e), (f), and
(k) to read as follows:
Sec. 80.553 Under what conditions may the small refiner gasoline
sulfur standards be extended for a small refiner of motor vehicle
diesel fuel?
* * * * *
(d) Beginning June 1, 2006, and continuing through December 31,
2010, all motor vehicle diesel fuel produced by a refiner that has
received an extension of its small refiner gasoline sulfur standards
under this section must be accurately designated under Sec. 80.598 as
meeting the 15 ppm sulfur content standard under Sec. 80.520(a)(1).
(e) The total volume of motor vehicle diesel fuel produced for use
in the United States and designated as meeting the 15 ppm sulfur
content standard under paragraph (d) of this section must meet or
exceed 85 percent of the baseline volume established under paragraph
(c) of this section, except that for the first compliance period from
June 1, 2006 through June 30, 2007, the total volume must meet or
exceed 92 percent of the baseline volume.
(f) Compliance with the volume requirements in paragraph (e) of
this section shall be determined each compliance period. Annual
compliance periods shall be from July 1 through June 30. For the year
2006, the compliance period shall be from June 1, 2006 through June 30,
2007 and for the year 2009 the compliance period shall be from July 1,
2009 through May 31, 2010.
* * * * *
(k) A refiner may petition the Administrator to vacate an extension
of the small refiner gasoline sulfur content standards. EPA may grant
such a petition, effective July 1 of the compliance period following
receipt of such petition (or effective June 1, 2006, if applicable).
Upon such effective date, all gasoline produced by the refiner must
meet the gasoline sulfur content standards under subpart H of this part
as if there had been no extension of the small refiner gasoline sulfur
content standards under this section. Upon such effective date, the
refiner shall not be subject to the requirements of this section.
* * * * *
? 33. A new Sec. 80.554 is added to read as follows:
Sec. 80.554 What compliance options are available to NRLM diesel fuel
small refiners?
(a) Option 1: A refiner that has been approved by EPA as a NRLM
diesel fuel small refiner under Sec. 80.551(g) may produce NRLM diesel
fuel from crude oil from June 1, 2007 through May 31, 2010, that is
exempt from the standards under Sec. 80.510(a), but only for a
refinery located outside the areas specified under Sec. 80.510(g)(1).
(1) The volume of NRLM diesel fuel that is exempt from Sec.
80.510(a) must be less than or equal to 105 percent of BNRLM
as defined under Sec. 80.533, less any volume of heating oil produced.
(2) Any volume of NRLM diesel fuel in excess of the volume allowed
under (a)(1) of this section will be subject to the 500 ppm sulfur
standard under Sec. 80.510(a).
(3) High-sulfur NRLM produced under this paragraph must--
(i) Be dyed red pursuant to the provisions of Sec. 80.520 at the
point of production or importation;
(ii) Be associated with a product transfer document that bears a
unique product code as specified under Sec. 80.590; and
(iii) Not be delivered into areas specified under Sec.
80.510(g)(1).
(4) From June 1, 2007 through May 31, 2010, a refiner that has been
approved by EPA as a NRLM diesel fuel small refiner under Sec.
80.551(g) may produce at a refinery located in 80.510(g)(2) NRLM diesel
fuel that is exempt from the standards under Sec. 80.510(a) only if
the refiner first obtains approval from the Administrator for a
compliance plan. The compliance plan must detail how the refiner will
segregate any fuel produced that does
[[Page 39180]]
not meet the standards under Sec. 80.510(a) from the refinery through
to the ultimate consumer from fuel having any other designations and
from fuel produced by any other refiner. The compliance plan must also
identify all ultimate consumers to whom the refiner supplies the fuel
that does not meet the standards under Sec. 80.510(a).
(b) Option 2: A refiner that has been approved by EPA as a NRLM
diesel fuel small refiner under Sec. 80.551(g) may produce NR diesel
fuel from crude oil from June 1, 2010, through May 31, 2014, and NRLM
diesel fuel from crude oil from June 1, 2012 through May 31, 2014 that
is subject to the standards under Sec. 80.510(a), but only for a
refinery located outside the areas specified under Sec. 80.510(g)(1).
(1) The volume of NR diesel fuel that may be subject to the 500 ppm
sulfur standard from June 1, 2010 through June 30, 2011 must be less
than or equal to 113 percent of BNRLM, and from July 1, 2011
through May 31, 2012 must be less than or equal to 96 percent of
BNRLM, as defined under Sec. 80.533, less any volume of
locomotive and marine diesel fuel produced.
(2) The volume of NRLM diesel fuel that may be subject to the 500
ppm sulfur standard from June 1, 2012 through June 30, 2013 must be
less than or equal to 113 percent of BNRLM, and from July 1,
2013 through May 31, 2014 must be less than or equal to 96 percent of
BNRLM, as defined under Sec. 80.533.
(3) NRLM diesel fuel produced in excess of the volume allowed under
paragraph (b)(1) of this section will be subject to the standards under
Sec. 80.510(b) and (c).
(4) 500 ppm sulfur NRLM diesel fuel produced under this paragraph
must--
(i) Bear a unique product code as specified under Sec. 80.590; and
(ii) Not be sold or delivered into areas specified under Sec.
80.510(g)(1).
(5) From June 1, 2010 through May 31, 2012, for NR diesel fuel, and
from June 1, 2012 through May 31, 2014 for NRLM diesel fuel, a refiner
that has been approved by EPA as a NRLM diesel fuel small refiner under
Sec. 80.551(g) may produce, at a refinery located in Alaska, NR and
NRLM diesel fuel, as applicable, from crude oil that is subject to the
standards of Sec. 80.510(a), only if the refiner first obtains
approval from the Administrator for a compliance plan. The compliance
plan must detail how the refiner will segregate any fuel produced
subject to the standards under Sec. 80.510(a) from the refinery
through to the ultimate consumer from fuel having any other
designations and from fuel produced by any other refiner. The
compliance plan must also identify all ultimate consumers to whom the
refiner supplies the fuel that does not meet the standards under Sec.
80.510(a).
(c) Option 3: A refiner that has been approved by EPA as a NRLM
diesel fuel small refiner under Sec. 80.551(g) may generate diesel
fuel credits under the provisions of Sec. 80.535(b) and (d), except as
provided in paragraph (d)(1) of this section.
(d) Option 4: (1) In lieu of Options 1, 2, and 3 of this section, a
refiner that has been approved by EPA as a NRLM diesel fuel small
refiner under Sec. 80.551(g) may choose to adjust its small refiner
gasoline sulfur standards, subject to the following conditions:
(i) From June 1, 2006 until the expiration of the refiner's small
refiner gasoline sulfur standards (through December 31, 2007 or 2010)
95 percent of the NRLM diesel fuel produced by the refiner must be
accurately designated under Sec. 80.598(a) as meeting the 15 ppm
sulfur standard of Sec. 80.510(b).
(ii) The refiner must produce NRLM diesel fuel each year or partial
year under paragraph (d)(1)(i) of this section at a volume that is
equal to or greater than 85 percent of BNRLM , as defined in
Sec. 80.533, calculated on an annual basis.
(2)(i) For a refiner meeting the conditions of paragraph (d)(1) of
this section, beginning January 1, 2004, the applicable small refiner's
annual average and per-gallon cap gasoline sulfur standards will be the
standards of Sec. 80.240(a) increased by a factor of 1.20 for the
duration of the refiner's small refiner gasoline sulfur standards under
Sec. 80.240(a) or Sec. 80.553 (i.e., through calendar years 2007 or
2010).
(ii) In no case may the per-gallon cap exceed 450 ppm.
(3)(i) If the refiner fails to produce the necessary volume of 15
ppm sulfur NRLM diesel fuel by June 1, 2006 and every year thereafter
through the deadlines specified under paragraph (d)(1)(i) of this
section, the refiner must report this in its annual report under Sec.
80.604, and the adjustment of gasoline sulfur standards under paragraph
(d)(2)(i) of this section will be considered void as of January 1, 2004.
(ii) If such a refiner had produced gasoline above its interim
gasoline sulfur standard of Sec. 80.240(a) prior to June 1, 2006, such
fuel will not be considered in violation of the small refiner standards
under Sec. 80.240(a), provided the refiner obtains and uses a quantity
of gasoline sulfur credits equal to the volume of gasoline exceeding
the small refiner standards multiplied by the number of parts per
million by which the gasoline exceeded the small refiner standards.
(e) Multiple refineries. The provisions of this section shall apply
separately for each refinery owned or operated by a NRLM diesel fuel
small refiner.
(f) Other provisions. From June 1, 2007 through May 31, 2010, a
refiner who is an approved motor vehicle diesel fuel small refiner
under Sec. 80.550(a) but does not qualify as a NRLM diesel fuel small
refiner under Sec. 80.550(b) may produce NRLM diesel fuel that is
exempt from the per-gallon sulfur standard and the cetane or aromatics
standard of Sec. 80.510(a). This exemption does not apply to diesel
fuel sold or intended for sale in the areas listed in Sec.
80.510(g)(1) or (g)(2). From June 1, 2010 through May 31, 2012, NR and
LM diesel fuel produced by such refiners is subject to the standards
under Sec. 80.510(b) and beginning June 1, 2012, all NRLM diesel fuel
is subject to the standards under Sec. 80.510(c).
? 34. A new Sec. 80.555 is added to read as follows:
Sec. 80.555 What provisions are available to a large refiner that
acquires a small refiner or one or more of its refineries?
(a) In the case of a refiner without approved small refiner status
who acquires a refinery from a refiner with approved status as a motor
vehicle diesel fuel small refiner or a NRLM diesel fuel small refiner
under Sec. 80.551(g), the applicable small refiner provisions of
Sec. Sec. 80.552 and 80.554 may apply to the acquired refinery for a
period of up to 30 months from the date of acquisition of the refinery.
In no case shall this period extend beyond May 31, 2010 for a refinery
acquired from a motor vehicle diesel fuel small refiner or beyond the
dates specified in Sec. 80.554(a) or (b), as applicable, for a
refinery acquired from a NRLM diesel fuel small refiner.
(b) A refiner may apply to EPA for up to an additional six months
to comply with the standards of Sec. 80.510 or 80.520 for the acquired
refinery if more than 30 months would be required for the necessary
engineering, permitting, construction, and start-up work to be
completed. Such applications must include detailed technical
information supporting the need for additional time. EPA will base a
decision to approve additional time on information provided by the
refiner and on other relevant information. In no case will EPA extend
the compliance date beyond May 31, 2010 for a refinery acquired from a
motor vehicle diesel fuel small refiner or beyond the dates specified
in Sec. 80.554(a) or (b), as applicable, for a refinery acquired from
a NRLM diesel fuel small refiner.
[[Page 39181]]
(c) Refiners who acquire a refinery from a refiner with approved
status as a motor vehicle diesel fuel small refiner or a NRLM diesel
fuel small refiner under Sec. 80.551(g), shall notify EPA in writing
no later than 20 days following the acquisition.
? 35. Section 80.560 is amended by revising paragraphs (a), (b), (d),
(e), (h), (i), (k), and (l) to read as follows:
Sec. 80.560 How can a refiner seek temporary relief from the
requirements of this subpart in case of extreme hardship circumstances?
(a) EPA may, at its discretion, grant a refiner of crude oil that
processes crude oil through refinery processing units, for one or more
of its refineries, temporary relief from some or all of the provisions
of this subpart. Such relief shall be no less stringent than the small
refiner compliance options specified in Sec. 80.552 for motor vehicle
diesel fuel and Sec. 80.554 for NRLM diesel fuel. EPA may grant such
relief provided that the refiner demonstrates that--
(1) Unusual circumstances exist that impose extreme hardship and
significantly affect the refiner's ability to comply by the applicable
date; and
(2) It has made best efforts to comply with the requirements of
this subpart.
(b)(1) For motor vehicle diesel fuel, applications must be
submitted to EPA by June 1, 2002 to the following address: U.S. EPA--
Attn: Diesel Hardship, Transportation and Regional Programs Division
(6406J), 1200 Pennsylvania Avenue, NW., Washington, DC 20460 (certified
mail/return receipt) or Attn: Diesel Hardship, Transportation and
Regional Programs Division, 1310 L Street, NW., 6th floor, Washington,
DC 20005 (express mail/return receipt). EPA reserves the right to deny
applications for appropriate reasons, including unacceptable
environmental impact. Approval to distribute motor vehicle diesel fuel
not subject to the 15 ppm sulfur standard may be granted for such time
period as EPA determines is appropriate, but shall not extend beyond
May 31, 2010.
(2) For NRLM diesel fuel, applications must be submitted to EPA by
June 1, 2005 to the following address: U.S. EPA--Attn: Diesel Hardship,
Transportation and Regional Programs Division (6406J), 1200
Pennsylvania Avenue, NW., Washington, DC 20460 (certified mail/return
receipt) or Attn: Diesel Hardship, Transportation and Regional Programs
Division, 1310 L Street, NW., 6th floor, Washington, DC 20005 (express
mail/return receipt). EPA reserves the right to deny applications for
appropriate reasons, including unacceptable environmental impact.
Approval to distribute NRLM diesel fuel not subject to the 500 ppm
sulfur standard may be granted for such time period as EPA determines
is appropriate, but shall not extend beyond May 31, 2010 for NR diesel
fuel and May 31, 2012 for NRLM diesel fuel. Approval to distribute NRLM
diesel fuel not subject to the 15 ppm sulfur standard may be granted
for such time period as EPA determines is appropriate, but shall not
extend beyond May 31, 2014.
* * * * *
(d) Applicants must provide, at a minimum, the following
information:
(1) Detailed description of efforts to obtain capital for refinery
investments and efforts made to obtain credits for compliance under
Sec. 80.531 for motor vehicle diesel fuel or Sec. Sec. 80.535 through
80.536 for NRLM diesel fuel;
(2) Bond rating of entity that owns the refinery (in the case of
joint ventures, include the bond rating of the joint venture entity and
the bond ratings of all partners; in the case of corporations, include
the bond ratings of any parent or subsidiary corporations); and
(3) Estimated capital investment needed to comply with the
requirements of this subpart by the applicable date.
(e) In addition to the application requirements of paragraph (b)
through (d) of this section, a refiner's application for temporary
relief under this paragraph (e) must also include a compliance plan.
Such compliance plan shall demonstrate how the refiner will engage in a
quality assurance testing program, where appropriate, to ensure that
the following conditions are met:
(1)(i) Its motor vehicle diesel fuel subject solely to the sulfur
standards under Sec. 80.520(c) has not caused motor vehicle diesel
fuel subject to the 15 ppm sulfur standard Sec. 80.520(a)(1) to fail
to comply with that standard; or
(ii) Its NRLM diesel fuel subject solely to the 500 ppm sulfur
standard under Sec. 80.510(a) has not caused NRLM diesel fuel subject
to the 15 ppm sulfur standard under Sec. 80.510(b) or (c) to fail to
comply with that standard.
(2) The quality assurance program must at least include periodic
sampling and testing at the party's own facilities and at downstream
facilities in the refiner's or importer's diesel fuel distribution
system, to determine compliance with the applicable sulfur standards
for both categories of motor vehicle diesel fuel; examination at the
party's own facilities and at applicable downstream facilities, of
product transfer documents to confirm appropriate transfers and
deliveries of both products; and inspection of retailer and wholesale
purchaser-consumer pump stands for the presence of the labels and
warning signs required under this section. Any violations that are
discovered shall be reported to EPA within 48 hours of discovery.
* * * * *
(h) Refiners who are granted a hardship relief standard for any
refinery and importers of fuel subject to temporary foreign refiner
relief standards, must comply with the requirements of Sec. 80.561(f).
(i) EPA may impose any reasonable conditions on waivers under this
section, including limitations on the refinery's volume of motor
vehicle diesel fuel and NRLM diesel fuel subject to temporary refiner
relief standards.
* * * * *
(k) The individual refinery sulfur standard and the compliance plan
will be approved or disapproved by the Administrator, and approval will
be effective when the refiner receives an approval letter from EPA.
Unless approved, the refiner or, where applicable, the importer must
comply with the motor vehicle diesel fuel standard under Sec.
80.520(a)(1) by the appropriate compliance date specified in Sec.
80.500 or the NRLM diesel fuel standards and compliance dates under
Sec. 80.510(a), (b), and (c) as applicable.
(l) If EPA finds that a refiner provided false or inaccurate
information on its application for hardship relief, EPA's approval of
the refiners application will be void ab initio.
? 36. Section 80.561 is amended by revising the introductory text and
paragraphs (c), (d), and (f) to read as follows:
Sec. 80.561 How can a refiner or importer seek temporary relief from
the requirements of this subpart in case of extreme unforseen
circumstances?
In appropriate extreme, unusual, and unforseen circumstances (for
example, natural disaster or refinery fire) which are clearly outside
the control of the refiner or importer and which could not have been
avoided by the exercise of prudence, diligence, and due care, EPA may
permit a refiner or importer, for a brief period, to distribute motor
vehicle diesel fuel or NRLM diesel fuel which does not meet the
requirements of this subpart if:
* * * * *
(c) The refiner or importer can show how the requirements for motor
vehicle diesel fuel or NRLM diesel fuel will be expeditiously achieved;
(d) The refiner or importer agrees to make up any air quality
detriment associated with the nonconforming
[[Page 39182]]
motor vehicle diesel fuel or NRLM diesel fuel, where practicable;
* * * * *
(f)(1) In the case of motor vehicle diesel fuel distributed under
this section that does not meet the 15 ppm sulfur standard under Sec.
80.520(a)(1), such diesel fuel shall not be distributed for use in
model year 2007 or later motor vehicles, and must meet all the
requirements and prohibitions of this subpart applicable to diesel fuel
meeting the sulfur standard under Sec. 80.520(c), or to diesel fuel
that is not motor vehicle diesel fuel, as applicable.
(2) In the case of NRLM diesel fuel distributed under this section
from June 1, 2007 through May 31, 2010 that does not meet the 500 ppm
sulfur standard under Sec. 80.510(a), such diesel fuel must meet the
requirements and prohibitions applicable to high sulfur NRLM credit
fuel under Sec. 80.536(f)(1)(i) and (ii).
(3) In the case of NR diesel fuel distributed under this section
after May 31, 2010 that does not meet the 15 ppm sulfur standard under
Sec. 80.510(b), such diesel fuel shall not be distributed for use in
model year 2011 or later nonroad engines, and must meet all the
requirements and prohibitions of this subpart applicable to diesel fuel
meeting the sulfur standard under Sec. 80.510(a) for NRLM diesel fuel.
(4) In the case of NRLM diesel fuel distributed under this section
after May 31, 2012 that does not meet the 15 ppm sulfur standard under
Sec. 80.510(c), such diesel fuel shall not be distributed for use in
model year 2011 or later nonroad engines, and must meet all the
requirements and prohibitions of this subpart applicable to diesel fuel
meeting the sulfur standard under Sec. 80.510(a) for NRLM diesel fuel.
? 37. Section 80.570 is revised to read as follows:
Sec. 80.570 What labeling requirements apply to retailers and
wholesale purchaser-consumers of diesel fuel beginning June 1, 2006?
(a) From June 1, 2006 through May 31, 2010, any retailer or
wholesale purchaser-consumer who sells, dispenses, or offers for sale
or dispensing, motor vehicle diesel fuel subject to the 15 ppm sulfur
standard of Sec. 80.520(a)(1), must affix the following conspicuous
and legible label, in block letters of no less than 24-point bold type,
and printed in a color contrasting with the background, to each pump stand:
ULTRA-LOW SULFUR HIGHWAY DIESEL FUEL (15 ppm Sulfur Maximum)
Required for use in all model year 2007 and later highway diesel
vehicles and engines.
Recommended for use in all diesel vehicles and engines.
(b) From June 1, 2006 through September 30, 2010, any retailer or
wholesale purchaser-consumer who sells, dispenses, or offers for sale
or dispensing, motor vehicle diesel fuel subject to the 500 ppm sulfur
standard of Sec. 80.520(c), must prominently and conspicuously display
in the immediate area of each pump stand from which motor vehicle fuel
subject to the 500 ppm sulfur standard is offered for sale or
dispensing, the following legible label, in block letters of no less
than 24-point bold type, printed in a color contrasting with the
background:
LOW SULFUR HIGHWAY DIESEL FUEL (500 ppm Sulfur Maximum)
WARNING
Federal law prohibits use in model year 2007 and later highway
vehicles and engines.
Its use may damage these vehicles and engines.
(c) From June 1, 2006 through May 31, 2007, any retailer or
wholesale purchaser-consumer who sells, dispenses, or offers for sale
or dispensing, diesel fuel for non-motor vehicle equipment that does
not meet the standards for motor vehicle diesel fuel, must affix the
following conspicuous and legible label, in block letters of no less
than 24-point bold type, and printed in a color contrasting with the
background, to each pump stand:
NON-HIGHWAY DIESEL FUEL (May Exceed 500 ppm Sulfur)
WARNING
Federal law prohibits use in highway vehicles or engines.
Its use may damage these vehicles and engines.
(d) The labels required by paragraphs (a) through (c) of this
section must be placed on the vertical surface of each pump housing and
on each side that has gallon and price meters. The labels shall be on
the upper two-thirds of the pump, in a location where they are clearly
visible.
(e) Alternative labels to those specified in paragraphs (a) through
(c) of this section may be used as approved by the Administrator.
? 38. A new Sec. 80.571 is added to read as follows:
Sec. 80.571 What labeling requirements apply to retailers and
wholesale purchaser-consumers of NRLM diesel fuel or heating oil
beginning June 1, 2007?
Any retailer or wholesale purchaser-consumer who sells, dispenses,
or offers for sale or dispensing nonroad, locomotive or marine (NRLM)
diesel fuel (including nonroad (NR) and locomotive or marine (LM)), or
heating oil, must prominently and conspicuously display in the
immediate area of each pump stand from which non-highway diesel fuel is
offered for sale or dispensing, one of the following legible labels, as
applicable, in block letters of no less than 24-point bold type,
printed in a color contrasting with the background:
(a) From June 1, 2007 through May 31, 2010, for pumps dispensing
NRLM diesel fuel meeting the 15 ppm sulfur standard of Sec. 80.510(b):
ULTRA-LOW SULFUR NON-HIGHWAY DIESEL FUEL (15 ppm Sulfur Maximum)
Required for use in all model year 2011 and newer nonroad diesel
engines.
Recommended for use in all nonroad, locomotive, and marine
diesel engines.
WARNING
Federal Law prohibits use in highway vehicles or engines.
(b) From June 1, 2007 through May 31, 2010, for pumps dispensing
NRLM diesel fuel meeting the 500 ppm sulfur standard of Sec. 80.510(a):
LOW SULFUR NON-HIGHWAY DIESEL FUEL (500 ppm Sulfur Maximum)
WARNING
Federal Law prohibits use in highway vehicles or engines.
(c) From June 1, 2007 through September 30, 2010, for pumps
dispensing NRLM diesel fuel not meeting, or not offered as meeting, the
500 ppm sulfur standard of Sec. 80.510(a) or the 15 ppm sulfur
standard of Sec. 80.510(b):
HIGH SULFUR NON-HIGHWAY DIESEL FUEL (May Exceed 500 ppm Sulfur)
WARNING
Federal law prohibits use in highway vehicles or engines.
May damage nonroad diesel engines required to use low-sulfur or
ultra-low sulfur diesel fuel.
(d) From June 1, 2007 and beyond, for pumps dispensing non-motor
vehicle diesel fuel for use other than in nonroad, locomotive or marine
engines, such as for use in stationary diesel engines or as heating oil:
HEATING OIL (May Exceed 500 ppm Sulfur)
WARNING
Federal law prohibits use in highway vehicles or engines, or in
nonroad, locomotive, or marine diesel engines.
Its use may damage these diesel engines.
(e) The labels required by paragraphs (a) through (d) of this
section must be placed on the vertical surface of each pump housing and
on each side that has
[[Page 39183]]
gallon and price meters. The labels shall be on the upper two-thirds of
the pump, in a location where they are clearly visible.
(f) Alternative labels to those specified in paragraphs (a) through
(d) of this section may be used as approved by the Administrator.
? 39. A new Sec. 80.572 is added to read as follows:
Sec. 80.572 What labeling requirements apply to retailers and
wholesale purchaser-consumers of NR and NRLM diesel fuel and heating
oil beginning June 1, 2010?
Any retailer or wholesale purchaser-consumer who sells, dispenses,
or offers for sale or dispensing nonroad, locomotive or marine (NRLM)
diesel fuel (including nonroad (NR) and locomotive or marine (LM)), or
heating oil, must prominently and conspicuously display in the
immediate area of each pump stand from which non-highway diesel fuel is
offered for sale or dispensing, one of the following legible labels, as
applicable, in block letters of no less than 24-point bold type,
printed in a color contrasting with the background:
(a) From June 1, 2010 and beyond, any retailer or wholesale
purchaser-consumer who sells, dispenses, or offers for sale or
dispensing, motor vehicle diesel fuel subject to the 15 ppm sulfur
standard of Sec. 80.520(a)(1), must affix the following conspicuous
and legible label, in block letters of no less than 24-point bold type,
and printed in a color contrasting with the background, to each pump
stand:
ULTRA-LOW SULFUR HIGHWAY DIESEL FUEL (15 ppm Sulfur Maximum)
Required for use in all highway diesel vehicles and engines.
Recommended for use in all diesel vehicles and engines.
(b) From June 1, 2010 through May 31, 2012, for pumps dispensing NR
diesel fuel subject to the 15 ppm sulfur standard of Sec. 80.510(b):
ULTRA-LOW SULFUR NON-HIGHWAY DIESEL FUEL (15 ppm Sulfur Maximum)
Required for use in all model year 2011 and later nonroad diesel
engines.
Recommended for use in all other non-highway diesel engines.
WARNING
Federal law prohibits use in highway vehicles or engines.
(c) From June 1, 2010 through September 30, 2014, for pumps
dispensing NRLM diesel fuel subject to the 500 ppm sulfur standard of
Sec. 80.510(a):
LOW SULFUR NON-HIGHWAY DIESEL FUEL (500 ppm Sulfur Maximum)
WARNING
Federal law prohibits use in all model year 2011 and newer
nonroad engines.
May damage model year 2011 and newer nonroad engines.
Federal law prohibits use in highway vehicles or engines.
(d) From June 1, 2010 through September 30, 2012, for pumps
dispensing LM diesel fuel subject to the 500 ppm sulfur standard of
Sec. 80.510(a):
LOW SULFUR LOCOMOTIVE AND MARINE DIESEL FUEL (500 ppm Sulfur Maximum)
WARNING
Federal law prohibits use in nonroad engines or in highway
vehicles or engines.
(e) The labels required by paragraphs (a) through (d) of this
section must be placed on the vertical surface of each pump housing and
on each side that has gallon and price meters. The labels shall be on
the upper two-thirds of the pump, in a location where they are clearly
visible.
(f) Alternative labels to those specified in paragraphs (a) through
(d) of this section may be used as approved by the Administrator.
? 40. A new Sec. 80.573 is added to read as follows:
Sec. 80.573 What labeling requirements apply to retailers and
wholesale purchaser-consumers of NRLM diesel fuel and heating oil
beginning June 1, 2012?
Any retailer or wholesale purchaser-consumer who sells, dispenses,
or offers for sale or dispensing nonroad, locomotive or marine (NRLM)
diesel fuel (including nonroad (NR) and locomotive or marine (LM)), or
heating oil, must prominently and conspicuously display in the
immediate area of each pump stand from which non-highway diesel fuel is
offered for sale or dispensing, one of the following legible labels, as
applicable, in block letters of no less than 24-point bold type,
printed in a color contrasting with the background:
(a) From June 1, 2012 through May 31, 2014, for pumps dispensing
NRLM diesel fuel subject to the 15 ppm sulfur standard of Sec.
80.510(c):
ULTRA-LOW SULFUR NON-HIGHWAY DIESEL FUEL (15 ppm Sulfur Maximum)
Required for use in all model year 2011 and later nonroad diesel
engines.
Recommended for use in all other non-highway diesel engines.
WARNING
Federal law prohibits use in highway vehicles or engines.
(b) The labels required by paragraph (a) of this section must be
placed on the vertical surface of each pump housing and on each side
that has gallon and price meters. The labels shall be on the upper two-
thirds of the pump, in a location where they are clearly visible.
(c) Alternative labels to those specified in paragraph (a) of this
section may be used as approved by the Administrator.
? 41. A new Sec. 80.574 is added to read as follows:
Sec. 80.574 What labeling requirements apply to retailers and
wholesale purchaser-consumers of NRLM diesel fuel, or heating oil
beginning June 1, 2014?
Any retailer or wholesale purchaser-consumer who sells, dispenses,
or offers for sale or dispensing nonroad, locomotive or marine (NRLM)
diesel fuel (including nonroad (NR) and locomotive or marine (LM)), or
heating oil, must prominently and conspicuously display in the
immediate area of each pump stand from which non-highway diesel fuel is
offered for sale or dispensing, one of the following legible labels, as
applicable, in block letters of no less than 24-point bold type,
printed in a color contrasting with the background:
(a) From June 1, 2014 and beyond, for pumps dispensing NRLM diesel
fuel subject to the 15 ppm sulfur standard of Sec. 80.510(c):
ULTRA-LOW SULFUR NON-HIGHWAY DIESEL FUEL (15 ppm Sulfur Maximum)
Required for use in all nonroad diesel engines.
Recommended for use in all locomotive and marine diesel engines.
WARNING
Federal law prohibits use in highway vehicles or engines.
(b) From June 1, 2014 and beyond, for pumps dispensing LM diesel
fuel subject to the 500 ppm sulfur standard of Sec. 80.510(a):
LOW SULFUR LOCOMOTIVE OR MARINE DIESEL FUEL (500 ppm Sulfur Maximum)
WARNING
Federal law prohibits use in nonroad engines or in highway
vehicles or engines.
Its use may damage these engines.
(c) The labels required by paragraphs (a) and (b) of this section
must be placed on the vertical surface of each pump housing and on each
side that has gallon and price meters. The labels shall be on the upper
two-thirds of the pump, in a location where they are clearly visible.
(d) Alternative labels to those specified in paragraphs (a) and (b)
of this section may be used as approved by the Administrator.
[[Page 39184]]
? 42. Section 80.580 is revised to read as follows:
Sec. 80.580 What are the sampling and testing methods for sulfur?
The sulfur content of diesel fuel and diesel fuel additives is to
be determined in accordance with this section.
(a) Sampling method. The applicable sampling methodology is
provided in Sec. 80.330(b).
(b) Test method for sulfur. (1) Until December 27, 2004, for motor
vehicle diesel fuel and diesel fuel additives subject to the 15 ppm
sulfur standard of Sec. 80.520(a)(1), sulfur content may be determined
using ASTM D 6428-99.
(2) For motor vehicle diesel fuel and diesel fuel additives subject
to the 500 ppm sulfur standard of Sec. 80.520(c), and NRLM diesel fuel
subject to the 500 ppm sulfur standard of Sec. 80.510(a)(1), sulfur
content may be determined using ASTM D 2622-03.
(3) Beginning August 30, 2004, for motor vehicle diesel fuel and
diesel fuel additives subject to the 15 ppm sulfur standard of Sec.
80.520(a)(1), sulfur content may be determined using any test method
approved under Sec. 80.585.
(4) Beginning August 30, 2004, for NRLM diesel fuel and diesel fuel
additives subject to the 15 ppm standard of Sec. 80.510(b), sulfur
content may be determined using any test method approved under Sec.
80.585.
(c) Alternative test methods for sulfur. (1) Until December 27,
2004, for motor vehicle diesel fuel and diesel fuel additives subject
to the 15 ppm standard of Sec. 80.520(a)(1), sulfur content may be
determined using ASTM D 5453-03a or ASTM D 3120-03a, provided that the
refiner or importer test result is correlated with the appropriate
method specified in paragraph (a)(2) of this section.
(2) Options for testing sulfur content of 500 ppm diesel fuel. (i)
For motor vehicle diesel fuel and diesel fuel additives subject to the
500 ppm sulfur standard of Sec. 80.520(c), and for NRLM diesel fuel
subject to the 500 ppm sulfur standard of Sec. 80.510(a), sulfur
content may be determined using ASTM D 4294-03, ASTM D 5453-03a, or
ASTM D 6428-99, provided that the refiner or importer test result is
correlated with the appropriate method specified in paragraph
(a)(2)(ii) of this section; or
(ii) For motor vehicle diesel fuel and diesel fuel additives
subject to the 500 ppm sulfur standard of Sec. 80.520(c), and for NRLM
diesel fuel subject to the 500 ppm sulfur standard of Sec. 80.510(a),
sulfur content may be determined using any test method approved under
Sec. 80.585.
(d) Adjustment Factor for downstream test results. An adjustment
factor of negative two ppm sulfur shall be applied to the test results,
to account for test variability, but only for testing of motor vehicle
diesel fuel or NRLM diesel fuel identified as subject to the 15 ppm
sulfur standard of Sec. 80.510(b) or Sec. 80.520(a)(1).
(e) Materials incorporated by reference. The Director of the
Federal Register approved the incorporation by reference of the
documents listed in this section as prescribed in 5 U.S.C. 552(a) and 1
CFR part 51. Anyone may inspect copies at the U.S. EPA, Air and
Radiation Docket and Information Center, 1301 Constitution Ave., NW.,
Room B102, EPA West Building, Washington, DC 20460 or at the National
Archives and Records Administration (NARA). For information on the
availability of this material at NARA, call 202-741-6030, or go to:
http://www.archives.gov/federal_register/code_of_federal_regulations/
ibr_locations.html.
(1) ASTM material. Anyone may purchase copies of these materials
from the American Society for Testing and Materials, 100 Barr Harbor
Dr., West Conshohocken, PA 19428.
(i) ASTM D 2622-03, Standard Test Method for Sulfur in Petroleum
Products by Wavelength Dispersive X-ray Fluorescence Spectrometry.
(ii) ASTM D 3120-03a, Standard Test Method for Trace Quantities of
Sulfur in Light Liquid Petroleum Hydrocarbons by Oxidative
Microcoulometry.
(iii) ASTM D 4294-03, Standard Test Method for Sulfur in Petroleum
and Petroleum Products by Energy-Dispersive X-ray Fluorescence
Spectrometry.
(iv) ASTM D 5453-03a, Standard Test Method for Determination of
Total Sulfur in Light Hydrocarbons, Motor Fuels and Motor Oils by
Ultraviolet Fluorescence.
(v) ASTM D 6428-99, Test Method for Total Sulfur in Liquid Aromatic
Hydrocarbons and Their Derivatives by Oxidative Combustion and
Electrochemical Detection.
(2) [Reserved]
? 43. A new Sec. 80.581 is added to read as follows:
Sec. 80.581 What are the batch testing and sample retention
requirements for motor vehicle and NRLM diesel fuel?
(a) Beginning on June 1, 2006 or earlier pursuant to Sec. 80.531
for motor vehicle diesel fuel, and beginning June 1, 2010 or earlier
pursuant to Sec. 80.535 for NRLM diesel fuel, each refiner and
importer shall collect a representative sample from each batch of motor
vehicle or NRLM diesel fuel produced or imported and subject to the 15
ppm sulfur content standard. Batch, for the purposes of this section,
means batch as defined under Sec. 80.2 but without the reference to
transfer of custody from one facility to another facility.
(b) Except as provided in paragraph (c) of this section, the
refiner or importer shall test each sample collected pursuant to
paragraph (a) of this section to determine its sulfur content for
compliance with the requirements of this subpart prior to the diesel
fuel leaving the refinery or import facility, using an appropriate
sampling and testing method as specified in Sec. 80.580.
(c)(1) Any refiner who produces motor vehicle or NRLM diesel fuel
using computer-controlled in-line blending equipment, including the use
of an on-line analyzer test method that is approved under the
provisions of Sec. 80.580, and who, subsequent to production of the
diesel fuel batch tests a composited sample of the batch under the
provisions of Sec. 80.580 for purposes of designation and reporting,
is exempt from the requirement of paragraph (b) of this section to
obtain the test result required under this section prior to the diesel
fuel leaving the refinery, provided that the refiner obtains approval
from EPA.
(2) To obtain an exemption from paragraph (b) of this section, the
refiner must submit to EPA all the information required under Sec.
80.65(f)(4)(i)(A). A letter signed by the president, chief operating or
chief executive officer of the company, or his/her designee, stating
that the information contained in the submission is true to the best of
his/her belief must accompany any submission under this paragraph (c)(2).
(3) Refiners who seek an exemption under paragraph (c)(2) of this
section must comply with any request by EPA for additional information
or any other requirements that EPA includes as part of the exemption.
(4) Within 60 days of EPA's receipt of a submission under paragraph
(c)(2) of this section, EPA will notify the refiner if the exemption is
not approved or of any deficiencies in the refiner's submission, or if
any additional information is required or other requirements are
included in the exemption pursuant to paragraph (c)(3) of this section.
In the absence of such notification from EPA, the effective date of an
exemption under this paragraph (c) is 60 days from EPA's receipt of the
refiner's submission.
(5) EPA reserves the right to modify the requirements of an
exemption under
[[Page 39185]]
this paragraph (c), in whole or in part, at any time, if EPA determines
that the refiner's operation does not effectively or adequately
control, monitor or document the sulfur content of the refinery's
diesel fuel production, or if EPA determines that any other
circumstances exist which merit modification of the requirements of an
exemption, such as advancements in the state of the art for in-line
blending measurement which allow for additional control or more
accurate monitoring or documentation of sulfur content. If EPA finds
that a refiner provided false or inaccurate information in any
submission required for an exemption under this section, upon
notification from EPA, the refiner's exemption will be void ab initio.
(d) All test results under this section shall be retained for five
years and must be provided to EPA upon request.
(e) Samples collected under this section must be retained for at
least 30 days and provided to EPA upon request.
? 44. A new Sec. 80.582 is added to read as follows:
Sec. 80.582 What are the sampling and testing methods for the fuel
marker?
For heating oil and NRLM diesel fuel subject to the fuel marker
requirement in Sec. 80.510(d), (e), or (f), the identification of the
presence and concentration of the fuel marker in diesel fuel may be
determined using the test procedures qualified in accordance with the
requirements in this section.
(a) Sampling and testing for methods for the fuel marker. The
sampling, sample preparation, and testing methods qualified for use in
accordance with the requirements of this section may involve the use of
hazardous materials, operations and equipment. This section does not
address the associated safety problems which may exist. It is the
responsibility of the user of the procedures specified in this section
to establish appropriate safety and health practices prior to their
use. It is also the responsibility of the user to dispose of any
byproducts which might result from conducting these procedures in a
manner consistent with applicable safety and health requirements.
(b) What are the precision and accuracy criteria for qualification
of fuel marker test methods? (1) Precision. A standard deviation of
less than 0.10 milligrams per liter is required, computed from the
results of a minimum of 20 repeat tests made over 20 days on samples
taken from a homogeneous commercially available diesel fuel which meets
the applicable industry consensus and federal regulatory specifications
and which contains the fuel marker at a concentration in the range of
0.10 to 8 milligrams per liter. In order to qualify, the 20 results
must be a series of tests on the same material and there must be a
sequential record of the analysis with no omissions. A laboratory
facility may exclude a given sample or test result only if the
exclusion is for a valid reason under good laboratory practices and it
maintains records regarding the sample and test results and the reason
for excluding them.
(2) Accuracy. (i) The arithmetic average of a continuous series of
at least 10 tests performed on a commercially available marker solvent
yellow 124 standard in the range of 0.10 to 1 milligrams per liter
shall not differ from the ARV of that standard by more than 0.05
milligrams per liter.
(ii) The arithmetic average of a continuous series of at least 10
tests performed on a commercially available marker solvent yellow 124
standard in the range of 4 to 10 milligrams per liter shall not differ
from the ARV of that standard by more than 0.05 milligrams per liter.
(iii) In applying the tests of paragraphs (b)(2)(i) and (ii) of
this section, individual test results shall be compensated for any
known chemical interferences.
(c) What process must a test facility follow in order to qualify a
test method for determining the fuel marker content of distillate fuels
and how will EPA qualify or decline to qualify a test method? (1)
Qualification of test methods approved by voluntary consensus-based
standards bodies. Any standard test method developed by a Voluntary
Consensus-Based Standards Body, such as the American Society for
Testing and Materials (ASTM) or International Standards Organization
(ISO), shall be considered a qualified test method for determining the
fuel marker content of distillate fuel provided that it meets the
precision and accuracy criteria under paragraph (b) of this section.
The qualification of a test method is limited to the single test
facility that performed the testing for accuracy and precision. The
individual facility must submit the accuracy and precision results for
each method, including information on the date and time of each test
measurement used to demonstrate precision, following procedures
established by the Administrator.
(2) Qualification of test methods that have not been approved by a
voluntary consensus-based standards body. A test method that has not
been approved by a voluntary consensus-based standards body may be
qualified upon approval by the Administrator. The following information
must be submitted in the application for approval by each test
facility, for each test method that it wishes to have approved:
(i) Full test method documentation, including a description of the
technology and/or instrumentation that makes the method functional.
(ii) Information demonstrating that the test method meets the
accuracy and precision criteria under paragraph (b) of this section,
including information on the date and time of each test measurement
used to demonstrate precision.
(iii) Samples used for precision and accuracy determination must be
retained for 90 days.
(iv) If requested by the Administrator, test results utilizing the
method and performed on a sample of commercially available distillate
fuel which meets the applicable industry consensus and federal
regulatory specifications and which contains the fuel marker.
(v) Any additional information requested by the Administrator and
necessary to render a decision as to qualification of the test method.
(vi) The qualification of a test method is limited to the single
test facility that performed the testing for accuracy and precision and
any other required testing.
(3)(i) Within 90 days of receipt of all materials required to be
submitted under paragraph (c)(1) or (c)(2) of this section, the
Administrator shall determine whether to qualify the test method under
this section. The Administrator shall qualify the test method if all
materials required under this section are received and the test method
meets the accuracy and precision criteria of paragraph (b) of this
section.
(ii) If the Administrator denies approval of the test method,
within 90 days of receipt of all materials required to be submitted
under this section, the Administrator will notify the applicant of the
reasons for not approving the method. If the Administrator does not
notify the applicant within 90 days of receipt of the application, that
the test method is not approved, then the test method shall be deemed
approved.
(iii) If the Administrator finds that an individual test facility
has provided false or inaccurate information under this section, upon
notice from the Administrator, the qualification shall be void ab
initio.
(iv) The qualification of any test method under this paragraph (c)
shall be valid for the duration of the period during which the fuel marker
[[Page 39186]]
requirements remain applicable under this subpart.
(d) Quality control procedures for fuel marker measurement
instrumentation. A test shall not be considered a test using a
qualified test method unless the following quality control procedures
are performed separately for each instrument used to make measurements:
(1) Follow all mandatory provisions of ASTM D 6299-02 and construct
control charts from the mandatory quality control testing prescribed in
paragraph 7.1 of the reference method, following guidelines under A
1.5.1 for individual observation charts and A 1.5.2 for moving range
charts. The Director of the Federal Register approved the incorporation
by reference of ASTM D 6299-02, Standard Practice for Applying
Statistical Quality Assurance Techniques to Evaluate Analytical
Measurement System Performance, as prescribed in 5 U.S.C. 552(a) and 1
CFR part 51. Anyone may purchase copies of this standard from the
American Society for Testing and Materials, 100 Barr Harbor Dr., West
Conshohocken, PA 19428. Anyone may inspect copies at the U.S. EPA, Air
and Radiation Docket and Information Center, 1301 Constitution Ave.,
NW., Room B102, EPA West Building, Washington, DC 20460 or at the
National Archives and Records Administration (NARA). For information on
the availability of this material at NARA, call 202-741-6030, or go to:
http://www.archives.gov/federal_register/code_of_federal_regulations/
ibr_locations.html.
(2) Follow paragraph 7.3.1 of ASTM D 6299-02 to check standards
using a reference material at least monthly or following any major
change to the laboratory equipment or test procedure. Any deviation
from the accepted reference value of a check standard greater than 0.10
milligrams per liter must be investigated.
(3) Samples of tested batches must be retained for 30 days or the
period equal to the interval between quality control sample tests,
whichever is longer.
(4) Upon discovery of any quality control testing violation of
paragraph A 1.5.1.3 or A 1.5.2.1 of ASTM D 6299-02, or any check
standard deviation greater than 0.10 milligrams per liter, conduct an
investigation into the cause of such violation or deviation and, after
restoring method performance to statistical control, retest retained
samples from batches originally tested since the last satisfactory
quality control material or check standard testing occasion.
(5) Retain results of quality control testing and retesting of
retained samples under paragraph (d)(3) of this section for five years.
? 45. A new Sec. 80.583 is added to read as follows:
Sec. 80.583 What alternative sampling and testing requirements apply
to importers who transport motor vehicle diesel fuel or NRLM diesel
fuel by truck or rail car?
Importers who import diesel fuel subject to the 15 ppm sulfur
standard under Sec. 80.510(b) or (c) or 80.520(a) into the United
States by truck or by rail car may comply with the following
requirements instead of the requirements to sample and test each batch
of fuel designated as subject to the 15 ppm sulfur standard under Sec.
80.581 otherwise applicable to importers:
(a) Terminal testing. For purposes of determining compliance with
the 15 ppm sulfur standard, the importer may use test results for
sulfur content testing conducted by the foreign truck-loading or rail
car-loading terminal operator for diesel fuel contained in the storage
tank from which trucks or rail cars used to transport diesel fuel
designated as subject to the 15 ppm sulfur content standard into the
United States are loaded, provided the following conditions are met:
(1) The sampling and testing shall be performed after each receipt
of diesel fuel into the storage tank, or immediately before each
transfer of diesel fuel to the importer's truck or rail car.
(2) The sampling and testing shall be performed according to Sec.
80.580.
(3) At the time of each transfer of diesel fuel to the importer's
truck or rail car for import to the U.S., the importer must obtain a
copy of the terminal test result that indicates the sulfur content of
the truck or rail car load, or truck or rail car compartment load, as
applicable.
(b) Quality assurance program. The importer must conduct a quality
assurance program, as specified in this paragraph (b), for each truck
or rail car loading terminal.
(1) Quality assurance samples must be obtained from the truck-
loading or rail car loading terminal and tested by the importer, or by
an independent laboratory, and the terminal operator must not know in
advance when samples are to be collected.
(2) The sampling and testing must be performed using the methods
specified in Sec. 80.580.
(3) The frequency of the quality assurance sampling and testing
must be at least one sample for each 50 of an importer's trucks or rail
cars that are loaded at a terminal, or one sample per month, whichever
is more frequent.
(c) Party required to conduct quality assurance testing. The
quality assurance program under paragraph (b) of this section shall be
conducted by the importer. In the alternative, this testing may be
conducted by an independent laboratory that meets the criteria under
Sec. 80.65(f)(2)(iii), provided the importer receives copies of all
results of tests conducted no later than 21 days after the sample was
taken.
(d) Alternative batch designations. For purposes of maintaining
batch records under Sec. Sec. 80.592, 80.600, and 80.602, designation
of batches under Sec. 80.598, and reporting under Sec. Sec. 80.593,
80.601, and 80.604:
(1) In lieu of treating each portion of a tank truck compartment
delivered to a different facility as a different batch, a truck
importer may treat each compartment as a batch, if all the fuel in the
compartment is delivered only to retail outlets, wholesale purchaser-
consumers or other end users. Where different compartments contain
homogeneous product of identical designations, the total volume of
those compartments may be treated as a single batch, if the entire
volume is delivered only to retail outlets, wholesale purchaser-
consumers or other ultimate consumers.
(2) Each portion of a rail car (or rail cars) delivery of a
different designation or each delivery to a different facility is
considered to be a separate batch.
(e) EPA inspections of terminals. EPA inspectors or auditors must
be given full and immediate access to the truck or rail car-loading
terminal and any laboratory at which samples of diesel fuel collected
at the terminal are analyzed, and must be allowed to conduct
inspections, review records, collect diesel fuel samples and perform
audits. These inspections or audits may be either announced or unannounced.
(f) Certified DFR-Diesel. This section does not apply to Certified
DFR-Diesel as defined in Sec. 80.620.
(g) Effect of noncompliance. If any of the requirements of this
section are not met, all motor vehicle diesel fuel and NRLM diesel fuel
imported by the truck or rail car importer during the time the
requirements are not met is deemed in violation of the 15 ppm sulfur
diesel fuel standards in Sec. 80.510(b) or (c) or Sec. 80.520(a), as
applicable. Additionally, if any requirement is not met, EPA may notify
the importer of the violation, and, if the requirement is not fulfilled
within 10 days of notification, the truck importer may not in the
future use the sampling and testing provisions in this section in lieu
of the provisions in Sec. 80.581.
[[Page 39187]]
? 46. A new Sec. 80.584 is added to read as follows:
Sec. 80.584 What are the precision and accuracy criteria for approval
of test methods for determining the sulfur content of motor vehicle and
NRLM diesel fuel?
(a) Precision. (1) For motor vehicle diesel fuel and diesel fuel
additives subject to the 15 ppm sulfur standard of Sec. 80.520(a)(1)
and NRLM diesel fuel and diesel fuel additives subject to the 15 ppm
sulfur standard of Sec. 80.510(b) and (c), a standard deviation less
than 0.72 ppm, computed from the results of a minimum of 20 repeat
tests made over 20 days on samples taken from a single homogeneous
commercially available diesel fuel with a sulfur content in the range
of 5-15 ppm. The 20 results must be a series of tests with a sequential
record of the analyses and no omissions. A laboratory facility may
exclude a given sample or test result only if the exclusion is for a
valid reason under good laboratory practices and it maintains records
regarding the sample and test results and the reason for excluding them.
(2) For motor vehicle diesel fuel subject to the 500 ppm sulfur
standard of Sec. 80.520(c), and for NRLM diesel fuel subject to the
500 ppm sulfur standard of Sec. 80.510(a), of a standard deviation
less than 9.68 ppm, computed from the results of a minimum of 20 repeat
tests made over 20 days on samples taken from a single homogeneous
commercially available diesel fuel with a sulfur content in the range
of 200-500 ppm. The 20 results must be a series of tests with a
sequential record of the analyses and no omissions. A laboratory
facility may exclude a given sample or test result only if the
exclusion is for a valid reason under good laboratory practices and it
maintains records regarding the sample and test results and the reason
for excluding them.
(b) Accuracy. (1) For motor vehicle diesel fuel and diesel fuel
additives subject to the 15 ppm sulfur standard of Sec. 80.520(a)(1)
and NRLM diesel fuel and diesel fuel additives subject to the 15 ppm
sulfur standard of Sec. 80.510(b) and (c):
(i) The arithmetic average of a continuous series of at least 10
tests performed on a commercially available gravimetric sulfur standard
in the range of 1-10 ppm sulfur shall not differ from the accepted
reference value (ARV) of that standard by more than 0.54 ppm sulfur;
(ii) The arithmetic average of a continuous series of at least 10
tests performed on a commercially available gravimetric sulfur standard
in the range of 10-20 ppm sulfur shall not differ from the ARV of that
standard by more than 0.54 ppm sulfur; and
(iii) In applying the tests of paragraphs (b)(1)(i) and (ii) of
this section, individual test results shall be compensated for any
known chemical interferences.
(2) For motor vehicle diesel fuel subject to the 500 ppm sulfur
standard of Sec. 80.520(c), and for NRLM diesel fuel subject to the
500 ppm sulfur standard of Sec. 80.510(a):
(i) The arithmetic average of a continuous series of at least 10
tests performed on a commercially available gravimetric sulfur standard
in the range of 100-200 ppm sulfur shall not differ from the ARV of
that standard by more than 7.26 ppm sulfur;
(ii) The arithmetic average of a continuous series of at least 10
tests performed on a commercially available gravimetric sulfur standard
in the range of 400-500 ppm sulfur shall not differ from the ARV of
that standard by more than 7.26 ppm sulfur; and
(iii) In applying the tests of paragraphs (b)(2)(i) and (ii) of
this section, individual test results shall be compensated for any
known chemical interferences.
? 47. A new Sec. 80.585 is added to read as follows:
Sec. 80.585 What is the process for approval of a test method for
determining the sulfur content of diesel?
(a) Approval of test methods approved by voluntary consensus-based
standards bodies. For such a method to be approved, the following
information must be submitted to the Administrator by each test
facility for each test method that it wishes to have approved: Any test
method approved by a voluntary consensus-based standards body, such as
the American Society for Testing and Materials (ASTM) or International
Standards Organization (ISO), shall be approved as a test method for
determining the sulfur content of diesel fuel if it meets the
applicable accuracy and precision criteria under Sec. 80.584. The
approval of a test method is limited to the single test facility that
performed the testing for accuracy and precision. The individual
facility must submit the accuracy and precision results for each
method, including information on the date and time of each test
measurement used to demonstrate precision, following procedures
established by the Administrator.
(b) Approval of test methods not approved by a voluntary consensus-
based standards body. For such a method to be approved, the following
information must be submitted to the Administrator by each test
facility for each test method that it wishes to have approved:
(1) Full test method documentation, including a description of the
technology and/or instrumentation that makes the method functional.
(2) Information demonstrating that the test method meets the
applicable accuracy and precision criteria of Sec. 80.584, including
information on the date and time of each test measurement used to
demonstrate precision.
(3) If requested by the Administrator, test results from use of the
method to analyze samples of commercially available fuel provided by EPA.
(4) Any additional information requested by the Administrator and
necessary to render a decision as to approval of the test method.
(c) Sample retention. Samples used for precision and accuracy
determination must be retained for 90 days.
(d) EPA approval. (1) Within 90 days of receipt of all materials
required to be submitted under paragraph (a) or (b) of this section,
the Administrator shall determine whether the test method is approved
under this section.
(2) If the Administrator denies approval of the test method, within
90 days of receipt of all materials required to be submitted under
paragraph (a) or (b) of this section, the Administrator will notify the
applicant of the reasons for not approving the method. If the
Administrator does not notify the applicant within 90 days of receipt
of the application, that the test method is not approved, then the test
method shall be deemed approved.
(3) If the Administrator finds that an individual test facility has
provided false or inaccurate information under this section, upon
notice from the Administrator the approval shall be void ab initio.
(4) The approval of any test method under paragraph (b) of this
section shall be valid for five years from the date of approval by the
Administrator and shall not be extended. If the method is later
approved by a voluntary consensus-based standards body, the approval
shall remain valid as long as the conditions of paragraph (a) of this
section are met.
(e) Quality assurance procedures for sulfur measurement
instrumentation. A test shall not be considered a test using an
approved test method unless the following quality control procedures
are performed separately for each instrument used to make measurements:
(1) Follow all mandatory provisions of ASTM D 6299-02 and construct
control charts from the mandatory quality control testing prescribed in
paragraph
[[Page 39188]]
7.1 of the reference method, following guidelines under A 1.5.1 for
individual observation charts and A 1.5.2 for moving range charts. The
Director of the Federal Register approved the incorporation by
reference of ASTM D 6299-02, Standard Practice for Applying Statistical
Quality Assurance Techniques to Evaluate Analytical Measurement System
Performance, as prescribed in 5 U.S.C. 552(a) and 1 CFR part 51. Anyone
may purchase copies of this standard from the American Society for
Testing and Materials, 100 Barr Harbor Dr., West Conshohocken, PA
19428. Anyone may inspect copies at the U.S. EPA, Air and Radiation
Docket and Information Center, 1301 Constitution Ave., NW., Room B102,
EPA West Building, Washington, DC 20460 or at the National Archives and
Records Administration (NARA). For information on the availability of
this material at NARA, call 202-741-6030, or go to:
http://www.archives.gov/federal_register/code_of_federal_regulations/
ibr_locations.html.
(2) Follow paragraph 7.3.1 of ASTM D 6299-02 to check standards
using a reference material at least monthly or following any major
change to the laboratory equipment or test procedure. Any deviation
from the accepted reference value of a check standard greater than 1.44
ppm (for diesel fuel subject to the 15 ppm sulfur standard) or 19.36
ppm (for diesel fuel subject to the 500 ppm sulfur standard) must be
investigated.
(3) Samples of tested batches must be retained for 30 days or the
period equal to the interval between quality control sample tests,
whichever is longer.
(4) Upon discovery of any quality control testing violation of
paragraph A 1.5.1.3 or A 1.5.2.1 of ASTM D 6299-02, or any check
standard deviation greater than 1.44 ppm (for diesel fuel subject to
the 15 ppm sulfur standard) or 19.36 ppm (for diesel fuel subject to
the 500 ppm sulfur standard), conduct an investigation into the cause
of such violation or deviation and, after restoring method performance
to statistical control, retest retained samples from batches originally
tested since the last satisfactory quality control material or check
standard testing occasion.
? 48. A new Sec. 80.586 is added to read as follows:
Sec. 80.586 What are record retention requirements for test methods
approved under this subpart?
Each individual test facility must retain records related to the
establishment of accuracy and precision values, all test method
documentation, and any quality control testing and analysis under
Sec. Sec. 80.582, 80.584 and 80.585, for five years.
? 49. Section 80.590 is revised to read as follows:
Sec. 80.590 What are the product transfer document requirements for
motor vehicle diesel fuel, NRLM diesel fuel, heating oil and other
distillates?
(a) On each occasion that any person transfers custody or title to
MVNRLM diesel fuel or heating oil, including distillates used or
intended to be used as MVNRLM diesel fuel or heating oil, except when
such fuel is dispensed into motor vehicles or nonroad, locomotive, or
marine equipment, the transferor must provide to the transferee
documents which include the following information:
(1) The names and addresses of the transferor and transferee.
(2) The volume of diesel fuel or distillate which is being transferred.
(3) The location of the diesel fuel or distillate at the time of
the transfer.
(4) The date of the transfer.
(5) For transfers of MVNRLM diesel fuel, the sulfur content
standard the transferor represents the fuel to meet.
(6) Beginning June 1, 2006, when an entity transfers custody of a
distillate fuel designated under Sec. 80.598, the following
information must also be included:
(i) The facility registration number of the transferor issued under
Sec. 80.597, if any.
(ii) An accurate and clear statement of the applicable designation
and/or classification under Sec. 80.598, for example, 500 ppm sulfur
NRLM diesel fuel; and whether the fuel is dyed or undyed, and for
heating oil, whether marked or unmarked.
(7) For transfers of title or custody from one facility to another
in the distribution system where diesel fuel or distillates are taxed,
dyed or marked, and for any subsequent transfers (except when such fuel
is dispensed into motor vehicles or nonroad, locomotive or marine
equipment), an accurate statement on the product transfer document of
the applicable fuel uses and classifications, as follows:
(i) Undyed 15 ppm sulfur diesel fuel. For the period from June 1,
2006 and beyond, ``15 ppm sulfur (maximum) Undyed Ultra-Low Sulfur
Diesel Fuel For use in all diesel vehicles and engines.'' From June 1,
2006 through May 31, 2010, the product transfer document must also
state whether the diesel fuel is #1D or #2D.
(ii) Dyed 15 ppm sulfur diesel fuel. From June 1, 2006 and beyond,
``15 ppm sulfur (maximum) Dyed Ultra-Low Sulfur Diesel Fuel. For use in
all nonroad diesel engines. Not for use in highway vehicles or engines
except for tax-exempt use in accordance with section 4082 of the
Internal Revenue Code.''
(iii) Undyed 500 ppm sulfur diesel fuel. From June 1, 2006 through
September 30, 2010, ``500 ppm sulfur (maximum) Undyed Low Sulfur Diesel
Fuel. For use in Model Year 2006 and older diesel highway vehicles and
engines. Also for use in nonroad, locomotive, and marine diesel
engines. Not for use in model year 2007 and newer highway vehicles or
engines.''
(iv) Dyed 500 ppm sulfur diesel fuel. (A) For the period of June 1,
2006 through September 30, 2010, ``500 ppm sulfur (maximum) Dyed Low
Sulfur Nonroad, Locomotive or Marine Diesel Fuel. Not for use in
highway vehicles or engines except for use in Model Year 2006 and older
highway diesel vehicles or engines for tax-exempt use in accordance
with section 4082 of the Internal Revenue Code.''
(B) From June 1, 2010 through September 30, 2014, ``500 ppm sulfur
(maximum) Dyed Low Sulfur Nonroad Diesel Fuel. For use in model year
2010 and older nonroad diesel engines. May be used in locomotive and
marine diesel engines. Not for use in highway vehicles and engines or
model year 2011 or later nonroad engines other than locomotive or
marine diesel engines. Not for use in the Northeast/Mid-Atlantic Area.''
(C) For dyed locomotive and marine diesel fuel beginning June 1,
2010, ``500 ppm sulfur (maximum) Dyed Low Sulfur Locomotive and Marine
diesel fuel. Not for use in highway or other nonroad vehicles and
engines.''
(v) Dyed High Sulfur NRLM Fuel. From June 1, 2007 through September
30, 2010, ``High Sulfur Dyed Nonroad, Locomotive, or Marine Engine
Diesel fuel--sulfur content may exceed 500 ppm sulfur. Not for use in
highway vehicles or engines. Not for use in any nonroad engines
requiring Ultra-Low Sulfur Diesel Fuel. Not for use in the Northeast/
Mid-Atlantic Area.''
(vi) Heating oil. For heating oil produced or imported beginning
June 1, 2007, ``Heating Oil. Not for use in highway vehicles or engines
or nonroad, locomotive, or marine engines.''
(b) The following may be substituted for the descriptions in
paragraph (a) of this section, as appropriate:
(1) ``This is high sulfur diesel fuel for use only in Guam,
American Samoa, or the Northern Mariana Islands.'';
(2) ``This diesel fuel is for export use only.'';
[[Page 39189]]
(3) ``This diesel fuel is for research, development, or testing
purposes only.''; or
(4) ``This diesel fuel is for use in diesel highway vehicles or
nonroad equipment under an EPA-approved national security exemption only.''
(c) If undyed and/or unmarked distillate fuel is dyed and/or marked
subsequent to the issuance of a product transfer document, at the time
the distillate fuel is dyed and/or marked, a new product transfer
document must be prepared with the language under paragraph (a)(7) of
this section applicable to the changed fuel and provided to subsequent
transferees.
(d) Except for transfers to truck carriers, retailers or wholesale
purchaser-consumers, product codes may be used to convey the
information required under this section if such codes are clearly
understood by each transferee. Codes used to convey the statement in
paragraphs (a)(7)(i) and (ii) of this section must contain the number
``15'', and codes used to convey the statement in paragraphs
(a)(7)(iii) and (iv) of this section must contain the number ``500''.
Codes used to convey the statement in paragraph (a)(7)(v) of this
section must contain the statement ``greater than 500'' or ``>500''.
(e) From June 1, 2001 through May 31, 2005, any transfer subject to
this section, which is also subject to the early credit provisions of
Sec. 80.531(b), must comply with all applicable requirements of this
section.
(f) From June 1, 2005 through May 31, 2006, any transfer subject to
this section, which is also subject to the early credit requirements of
Sec. 80.531(c), must comply with all applicable requirements of this
section.
(g) Mobile refuelers. The provisions of this section shall also
apply to a mobile refueler that dispenses fuel from tanker trucks or
other vessels into motor vehicles, nonroad diesel engines or nonroad
diesel engine equipment. Each visit by the mobile refueler to a
location shall be considered a separate occasion for purposes of
paragraph (a) of this section. The tank trucks used by mobile refuelers
are not subject to the labeling requirements in Sec. Sec. 80.570
through 80.574.
(h) Identifications of fuel designations can be limited to a sub-
designation that accurately identifies the fuel and do not need to also
include the broader designation. For example, NR diesel fuel does not
also need to be designated as NRLM or MVNRLM diesel fuel.
? 50. Section 80.591 is revised to read as follows:
Sec. 80.591 What are the product transfer document requirements for
additives to be used in diesel fuel?
(a) Except as provided in paragraphs (b) and (d) of this section,
on each occasion that any person transfers custody or title to a diesel
fuel additive that is subject to the provisions of Sec. 80.521 to a
party in the additive distribution system or in the diesel fuel
distribution system for use downstream of the diesel fuel refiner, the
transferor must provide to the transferee documents which identify the
additive, and--
(1) Identify the name and address of the transferor and transferee;
the date of transfer; the location at which the transfer took place;
the volume of additive transferred; and
(2) Indicate compliance with the 15 ppm sulfur standard by
inclusion of the following statement: ``The sulfur content of this
diesel fuel additive does not exceed 15 ppm.''
(b) On each occasion that any person transfers custody or title to
a diesel fuel additive subject to the requirements of Sec. 80.521(b),
to a party in the additive distribution system or in the diesel fuel
distribution system for use in diesel fuel downstream of the diesel
fuel refiner, the transferor must provide to the transferee documents
which identify the additive, and do each of the following:
(1) Identify the name and address of the transferor and transferee;
the date of transfer; the location at which the transfer took place;
the volume of additive transferred.
(2) Indicate the high sulfur potential of the additive by inclusion
of the following statement:
This diesel fuel additive may exceed the federal 15 ppm sulfur
standard. Improper use of this additive may result in non-complying
diesel fuel.
(3) If the additive contains a static dissipater additive having a
sulfur content greater than 15 ppm, include the following statement:
This diesel fuel contains a static dissipater additive having a
sulfur content greater than 15 ppm.
(4) Include the following information:
(i) The additive's maximum sulfur concentration.
(ii) The maximum recommended concentration in volume percent for
use of the additive in diesel fuel.
(iii) The contribution to the sulfur level of the fuel, in ppm,
that would result if the additive is used at the maximum recommended
concentration.
(c) Except for transfers of diesel fuel additives to truck
carriers, retailers or wholesale purchaser-consumers, product codes may
be used to convey the information required under paragraphs (a) and (b)
of this section, if such codes are clearly understood by each
transferee. Codes used to convey the statement in paragraph (a)(2) of
this section must contain the number ``15'' and codes used to convey
the statement in paragraph (b)(2) of this section must not contain such
number.
(d) For those diesel fuel additives which are sold in containers
for use by the ultimate consumer of diesel fuel, each transferor must
have displayed on the additive container, in a legible and conspicuous
manner, either of the following statements, as applicable:
(1) ``This diesel fuel additive complies with the federal low
sulfur content requirements for use in diesel motor vehicles and
nonroad engines.''; or
(2) For those additives sold in containers for use by the ultimate
consumer, with a sulfur content in excess of 15 ppm the following
statement: ``This diesel fuel additive does not comply with federal
ultra-low sulfur content requirements for use in model year 2007 and
newer diesel motor vehicles or model year 2011 and newer diesel nonroad
equipment engines.''
? 51. Section 80.592 is amended by revising the heading and paragraphs
(a), (b) introductory text, (b)(4), (b)(7) introductory text, (c), (d),
and (e) to read as follows:
Sec. 80.592 What records must be kept by entities in the motor
vehicle diesel fuel and diesel fuel additive distribution systems?
(a) Records that must be kept by entities in the motor vehicle
diesel fuel and diesel fuel additive distribution systems. Beginning
June 1, 2006, or for a refiner or importer, the first compliance period
in which the refiner or importer is generating early credits under
Sec. 80.531(b) or (c), whichever is earlier, any person who produces,
imports, sells, offers for sale, dispenses, distributes, supplies,
offers for supply, stores, or transports motor vehicle diesel fuel
subject to the provisions of this subpart, must keep all the following
records:
(1) The applicable product transfer documents required under
Sec. Sec. 80.590 and 80.591.
(2) For any sampling and testing for sulfur content for a batch of
motor vehicle diesel fuel produced or imported and subject to the 15
ppm sulfur standard or any sampling and testing for sulfur content as
part of a quality assurance testing program, and any sampling and
testing for cetane index, aromatics content, solvent yellow 124 content
or dye solvent red 164
[[Page 39190]]
content of motor vehicle diesel fuel or motor vehicle diesel fuel
additives:
(i) The location, date, time and storage tank or truck
identification for each sample collected;
(ii) The name and title of the person who collected the sample and
the person who performed the testing; and
(iii) The results of the tests for sulfur content (including where
applicable the test results with and without application of the
adjustment factor under Sec. 80.580(a)(4)) and for cetane index or
aromatics content (as applicable), and the volume of product in the
storage tank or container from which the sample was taken.
(3) The actions the party has taken, if any, to stop the sale or
distribution of any motor vehicle diesel fuel found not to be in
compliance with the sulfur standards specified in this subpart, and the
actions the party has taken, if any, to identify the cause of any
noncompliance and prevent future instances of noncompliance.
(b) Additional records to be kept by refiners and importers of
motor vehicle diesel fuel subject to hardship standards, small refiner
standards and early credit provisions. Beginning June 1, 2006, or for a
refiner or importer, the first compliance period in which the refiner
or importer is generating early credits under Sec. 80.531(b) or (c),
any refiner producing motor vehicle diesel fuel subject to the sulfur
standard under Sec. 80.520(a)(1), for each of its refineries, and any
importer importing such motor vehicle diesel fuel, shall keep records
that include the following information for each batch of motor vehicle
diesel fuel produced or imported: * * *
(4) A record designating the batch as motor vehicle diesel fuel
meeting the 500 ppm sulfur standard or as motor vehicle diesel fuel
meeting the 15 ppm sulfur standard.
* * * * *
(7) Information regarding credits, kept separately for each
calendar year compliance period, kept separately for each refinery and
in the case of importers, kept separately for imports into each CTA,
and designated as motor vehicle diesel fuel credits and kept separately
from NRLM credits, as follows:
* * * * *
(c) Additional records importers must keep. Any importer shall keep
records that identify and verify the source of each batch of certified
diesel fuel program foreign refiner DFR-Diesel and non-certified DFR-
Diesel imported and demonstrate compliance with the requirements under
Sec. 80.620.
(d) Length of time records must be kept. The records required in
this section shall be kept for five years from the date they were
created, except that records relating to credit transfers shall be kept
by the transferor for 5 years from the date the credits were
transferred, and shall be kept by the transferee for 5 years from the
date the credits were transferred, used or terminated, whichever is
later.
(e) Make records available to EPA. On request by EPA, the records
required in this section must be made available to the Administrator or
the Administrator's representative. For records that are electronically
generated or maintained, the equipment and software necessary to read
the records shall be made available, or if requested by EPA, electronic
records shall be converted to paper documents which shall be provided
to the Administrator's authorized representative.
? 52. Section 80.593 is amended by revising the section heading and
paragraphs (a)(3) and (c)(2) to read as follows:
Sec. 80.593 What are the reporting requirements for refiners and
importers of motor vehicle diesel fuel subject to temporary refiner
relief standards?
* * * * *
(a) * * *
(3) The percentage of the volume of motor vehicle diesel fuel
produced during the compliance period that met the 15 ppm sulfur
standard and the percentage that met the 500 ppm sulfur standard prior
to the application of any volume credits.
* * * * *
(c) * * *
(2) Submitted to EPA no later than August 31 for the prior annual
compliance period.
? 53. Section 80.594 is amended by revising the section heading and
paragraphs (a)(3), (a)(5), (b) introductory text, (b)(2), and (c), and
adding paragraphs (a)(6), (a)(7), (a)(8), and (e) to read as follows:
Sec. 80.594 What are the pre-compliance reporting requirements for
motor vehicle diesel fuel?
(a) Except as provided in paragraph (d) of this section, beginning
on June 1, 2003, and on June 1, 2004 and June 1, 2005, all refiners and
importers planning to produce or import motor vehicle diesel fuel
subject to the provisions of this subpart, shall submit the following
information to EPA:
* * * * *
(3) An estimate of the average daily volumes (in gallons) of each
sulfur grade of motor vehicle diesel fuel produced (or imported) at
each refinery (or import facility). These volume estimates must be
provided both for fuel produced from crude oil, as well as any fuel
produced from other sources, and must be provided for the periods of
June 1, 2006 through December 31, 2006, January 1, 2007 through
December 31, 2007, January 1, 2008 through December 31, 2008, January
1, 2009 through December 31, 2009, and January 1, 2010 through May 31,
2010, for each refinery and import facility;
* * * * *
(5) Information on project schedule by quarter of known or
projected completion date by the stage of the project, for example,
following the five project phases described in EPA's June 2002 Highway
Diesel Progress Review report (EPA420-R-02-016, http://www.epa.gov/
otaq/regs/hd2007/420r02016.pdf): Strategic planning, Planning and
front-end engineering, Detailed engineering and permitting, Procurement
and construction, and Commissioning and startup;
(6) Basic information regarding the selected technology pathway for
compliance (e.g., conventional hydrotreating vs. other technologies,
revamp vs. grassroots, etc.);
(7) Whether capital commitments have been made or are projected to
be made; and
(8) The pre-compliance reports due 2004 and 2005 must provide an
update of the progress in each of these areas.
(b) Beginning on June 1, 2003, all approved motor vehicle diesel
fuel small refiners shall submit the following additional information
to EPA, as applicable:
* * * * *
(2) In case of a refinery with an approved application under Sec.
80.552(c), a demonstration that by June 1, 2006 its motor vehicle
diesel fuel will be at 15 ppm sulfur at a volume meeting the
requirements of Sec. 80.553(e).
(c) For each refiner and importer approved under Sec. 80.540, a
demonstration that by June 1, 2006, 95 percent of its motor vehicle
diesel fuel will be at 15 ppm sulfur at a volume of meeting the
requirements of Sec. 80.540(e).
* * * * *
(e) The pre-compliance reporting requirements of this section do
not apply to refineries subject to the provisions of Sec. 80.513.
? 54. Section 80.597 is revised to read as follows:
Sec. 80.597 What are the registration requirements?
The following registration requirements apply under this subpart:
(a) Registration for motor vehicle diesel fuel. Refiners having any
refinery
[[Page 39191]]
that is subject to a sulfur standard under Sec. 80.520(a), and
importers importing such diesel fuel, must provide EPA the information
under Sec. 80.76, if such information has not been provided under the
provisions of this part. In addition, for each import facility, the
same identifying information as required for each refinery under Sec.
80.76(c) must be provided.
(b) Registration for NRLM diesel. Refiners and importers that
intend to produce or supply NRLM diesel fuel by June 1, 2007, must
provide EPA the information under Sec. 80.76 no later than December
31, 2005, if such information has not been provided under the
provisions of this part. In addition, for each import facility, the
same identifying information as required for each refinery under Sec.
80.76(c) must be provided.
(c) Entity registration. (1) Each entity as defined in Sec. 80.502
that intends to deliver or receive custody of any of the following
fuels from June 1, 2007 through May 31, 2014 must register with EPA by
December 31, 2005 or six months prior to commencement of producing,
importing, or distributing any distillate subject to designation under
Sec. 80.598:
(i) Fuel designated as 500 ppm sulfur MVNRLM diesel fuel under
Sec. 80.598 on which taxes have not been assessed pursuant to IRS code
(26 CFR part 48).
(ii) Fuel designated as NRLM diesel fuel under Sec. 80.598 that is
undyed pursuant to Sec. 80.520.
(iii) Fuel designated as heating oil under Sec. 80.598 that is
unmarked pursuant to Sec. 80.510(d) through (f).
(iv) Fuel designated as LM diesel fuel under Sec.
80.598(a)(2)(iii) that is unmarked pursuant to Sec. 80.510(e).
(2) Registration shall be on forms prescribed by the Administrator,
and shall include the name, business address, contact name, telephone
number, e-mail address, and type of production, importation, or
distribution activity or activities engaged in by the entity.
(3) Registration shall include the information required under
paragraph (d) of this section for each facility owned or operated by
the entity that delivers or receives custody of a fuel described in
paragraph (c)(1) of this section.
(d) Facility registration. (1) List for each separate facility of
an entity required to register under paragraph (c) of this section, the
facility name, physical location, contact name, telephone number, e-
mail address and type of facility. For facilities that are aggregated
under Sec. 80.502, provide information regarding the nature and
location of each of the components. If aggregation is changed for any
subsequent compliance period, the entity must provide notice to EPA
prior to the beginning of such compliance period.
(2) If facility records are kept off-site, list the off-site
storage facility name, physical location, contact name, and telephone
number.
(e) Changes to registration information. Any company or entity
shall submit updated registration information to the Administrator
within 30 days of any occasion when the registration information
previously supplied for an entity, or any of its registered facilities,
becomes incomplete or inaccurate.
(f) Issuance of registration numbers. EPA will supply a
registration number to each entity and a facility registration number
to each of an entity's facilities that is identified, which shall be
used in all reports to the Administrator.
? 55. A new Sec. 80.598 is added to read as follows:
Sec. 80.598 What are the designation requirements for refiners,
importers, and distributors?
(a) Designation requirements for refiners and importers. (1) Any
refiner or importer shall accurately and clearly designate all fuel it
produces or imports for use in diesel motor vehicles as either motor
vehicle diesel fuel meeting the 15 ppm sulfur standard under Sec.
80.520(a)(1) or as motor vehicle diesel fuel meeting the 500 ppm sulfur
standard under Sec. 80.520(c).
(2) Subject to the restrictions in paragraph (a)(3) of this
section, beginning June 1, 2006, any refiner or importer shall
accurately and clearly designate each batch of diesel fuel or
distillate fuel for which they transfer custody to another entity,
according to the following categories, including specifying its volume:
(i) Designate the fuel as one of the following fuel types:
(A) Motor vehicle, nonroad, locomotive or marine (MVNRLM) diesel fuel;
(B) Heating oil;
(C) Jet fuel;
(D) Kerosene;
(E) No. 4 fuel;
(F) Distillate fuel for export only; or
(G) Exempt distillate fuels such as fuels that are covered by a
national security exemption under Sec. 80.606, fuels that are used for
purposes of research and development pursuant to Sec. 80.607, and
fuels used in the U.S. Territories pursuant to Sec. 80.608 (including
additional identifying information).
(ii) From June 1, 2006 through May 31, 2014 any batch designated as
MVNRLM diesel fuel must also be designated as one of the following:
(A) Motor vehicle diesel fuel; or
(B) NRLM diesel fuel.
(iii) From June 1, 2010 through May 31, 2012 any batch designated
as NRLM must also be designated as one of the following:
(A) NR diesel fuel; or
(B) LM diesel fuel.
(iv) Until June 1, 2014, any batch designated as MVNRLM diesel fuel
must also be designated according to one of the following three sulfur
level specifications:
(A) 15 ppm if its sulfur content is less than or equal to 15 ppm.
(B) 500 ppm if its sulfur content is less than or equal to 500 ppm.
(C) High Sulfur if its sulfur content is greater than 500 ppm.
(v) From June 1, 2006 through May 31, 2010, any batch designated as
motor vehicle diesel fuel must also be designated according to one of
the following two distillation classifications that most accurately
represents the fuel:
(A) #1D.
(B) #2D.
(3) The following restrictions and clarifications apply:
(i) Prior to June 1, 2006, any batch of MVNRLM not containing
visible evidence of red dye under Sec. 80.520(b) must be designated as
motor vehicle diesel fuel.
(ii) Any distillate fuel containing visible evidence of dye may not
be designated as motor vehicle diesel fuel unless it is further
designated as tax exempt motor vehicle diesel fuel.
(iii) Any distillate containing the marker required pursuant to the
provisions of Sec. 80.510(d) through (f) must be designated as heating
oil, except that from June 1, 2010 through May 31, 2012 it may also be
designated as LM diesel fuel, pursuant to Sec. 80.510(e).
(iv) Prior to June 1, 2009 all 15 ppm sulfur MVNRLM diesel fuel
must be designated as motor vehicle diesel fuel.
(v) Beginning June 1, 2010 any distillate fuel having a sulfur
content greater than 15 ppm may not be designated as motor vehicle
diesel fuel.
(vi) Beginning June 1, 2014, any distillate fuel having a sulfur
content greater than to 15 ppm may not be designated as MVNRLM diesel
fuel.
(vii) Any batch of #1D fuel which is suitable for use as
MVNRLM and which is also suitable for use as kerosene or jet fuel
(i.e., commonly referred to as dual use kerosene) may be designated as
MVNRLM, kerosene, or jet fuel (as applicable).
(viii) Beginning June 1, 2007, any distillate fuel with a sulfur
content
[[Page 39192]]
greater than 500 ppm distributed or intended for distribution in the
area specified in Sec. 80.510(g)(1), may not be designated as MVNRLM
diesel fuel.
(ix) From June 1, 2010 through May 31, 2012, any distillate fuel
with a sulfur content greater than 15 ppm distributed or intended for
distribution in the area specified in Sec. 80.510(g)(1), may not be
designated as NR diesel fuel.
(x) From June 1, 2012 through May 31, 2014, any distillate fuel
with a sulfur content greater than 15 ppm distributed or intended for
distribution in the area specified in Sec. 80.510(g)(1), may not be
designated as NRLM diesel fuel.
(xi) Beginning June 1, 2007, any distillate fuel with a sulfur
content greater than 500 ppm distributed or intended for distribution
in the area specified in Sec. 80.510(g)(2) may not be designated as
NRLM diesel fuel unless EPA has first approved a compliance plan for
the refiner for segregating the fuel from all other types of NRLM
diesel fuel from the refinery gate to the ultimate consumer, as
specified under Sec. 80.554(a)(4).
(xii) From June 1, 2010 through May 31, 2012, any distillate fuel
with a sulfur content greater than 15 ppm distributed or intended for
distribution in the area specified in Sec. 80.510(g)(2) may not be
designated as NR diesel fuel unless EPA has first approved a compliance
plan for the refiner for segregating the fuel from all other types of
NRLM diesel fuel from the refinery gate to the ultimate consumer, as
specified under Sec. 80.554(b)(4).
(xiii) From June 1, 2012 through May 31, 2014, any distillate fuel
with a sulfur content greater than 15 ppm distributed or intended for
distribution in the area specified in Sec. 80.510(g)(2) may not be
designated as NRLM diesel fuel unless, EPA has first approved a
compliance plan for the refiner for segregating the fuel from all other
types of NRLM diesel fuel from the refinery gate to the ultimate
consumer, as specified under Sec. 80.554(b)(4).
(xiv) Beginning June 1, 2014, any distillate fuel with a sulfur
content greater than 15 ppm may not be designated as MVNRLM diesel fuel.
(b) Designation requirements for fuel distributors. (1) Pursuant to
the provisions of paragraphs (b)(2) through (b)(9) of this section,
beginning June 1, 2006, any distributor shall accurately and clearly
designate each batch of diesel fuel or distillate fuel for which they
transfer custody to another facility, including specifying its volume,
as specified in this paragraph (b). Distributors must also accurately
and clearly classify such diesel fuel and distillate fuel by sulfur
content, while it is in their custody between receipt and delivery.
(2) From June 1, 2006 through May 31, 2009, whenever custody of a
batch of 15 ppm sulfur motor vehicle diesel fuel is transferred to
another facility, the entity transferring custody must accurately and
clearly designate the batch as one of the following and specify its
volume:
(i) #1D 15 ppm sulfur motor vehicle diesel fuel.
(ii) #2D 15 ppm sulfur motor vehicle diesel fuel.
(3) From June 1, 2009 through May 31, 2010, whenever custody of a
batch of 15 ppm sulfur MVNRLM diesel fuel is transferred to another
facility, the entity transferring custody must accurately and clearly
designate the batch as one of the following and specify its volume:
(i) #1D 15 ppm sulfur motor vehicle diesel fuel.
(ii) #2D 15 ppm sulfur motor vehicle diesel fuel.
(iii) 15 ppm sulfur NRLM diesel fuel.
(4) From June 1, 2006 through May 31, 2010, whenever custody of a
batch of undyed, 500 ppm sulfur MVNRLM is transferred to another
facility, the entity transferring custody must accurately and clearly
designate the batch as one of the following and specify its volume:
(i) #1D 500 ppm sulfur motor vehicle diesel fuel;
(ii) #2D 500 ppm sulfur motor vehicle diesel fuel; or
(iii) 500 ppm sulfur NRLM diesel fuel.
(5) From June 1, 2007 through May 31, 2010, whenever custody of a
batch of distillate fuel (other than jet fuel, kerosene, No. 4 fuel, or
fuel for export) having a sulfur content greater than 500 ppm is
transferred to another facility, the entity transferring custody must
accurately and clearly designate the batch as one of the following and
specify its volume:
(i) High sulfur NRLM diesel fuel (HSNRLM);
(ii) Heating oil; or
(iii) Exempt distillate fuels such as fuels that are covered by a
national security exemption under Sec. 80.606, fuels that are used for
purposes of research and development pursuant to Sec. 80.607, and
fuels used in the U.S. Territories pursuant to Sec. 80.608 (including
additional identifying information).
(6) From June 1, 2010 through May 31, 2012, whenever custody of a
batch of distillate fuel (other than jet fuel, kerosene, No. 4 fuel, or
fuel for export) having a sulfur content greater than 15 ppm is
transferred to another facility, the entity transferring custody must
accurately and clearly designate the batch as one of the following and
specify its volume:
(i) 500 ppm sulfur NR diesel fuel;
(ii) 500 ppm sulfur LM diesel fuel;
(iii) Heating oil; or
(iv) Exempt distillate fuels such as fuels that are covered by a
national security exemption under Sec. 80.606, fuels that are used for
purposes of research and development pursuant to Sec. 80.607, and
fuels used in the U.S. Territories pursuant to Sec. 80.608 (including
additional identifying information).
(7) From June 1, 2012 through May 31, 2014, whenever custody of a
batch of distillate fuel (other than jet fuel, kerosene, No. 4 fuel, or
fuel for export) having a sulfur content greater than 15 ppm is
transferred to another facility, the entity transferring custody must
accurately and clearly designate the batch as one of the following and
specify its volume:
(i) 500 ppm sulfur NRLM diesel fuel;
(ii) Heating oil; or
(iii) Exempt distillate fuels such as fuels that are covered by a
national security exemption under Sec. 80.606, fuels that are used for
purposes of research and development pursuant to Sec. 80.607, and
fuels used in the U.S. Territories pursuant to Sec. 80.608 (including
additional identifying information).
(8) Beginning June 1, 2014, whenever custody of a batch of
distillate fuel (other than jet fuel, kerosene, No. 4 fuel, or fuel for
export) having a sulfur content greater than 15 ppm is transferred to
another facility, the entity transferring custody must accurately and
clearly designate the batch as one of the following and specify its volume:
(i) 500 ppm sulfur LM diesel fuel;
(ii) Heating oil; or
(iii) Exempt distillate fuels such as fuels that are covered by a
national security exemption under Sec. 80.606, fuels that are used for
purposes of research and development pursuant to Sec. 80.607, and
fuels used in the U.S. Territories pursuant to Sec. 80.608 (including
additional identifying information).
(9) The following restrictions and clarifications apply. Subject to
the provisions of this paragraph (b)(9) and subject to the dye and
marker provisions of Sec. 80.520(b) and Sec. 80.510(d) through (f),
when custody of a batch of distillate fuel is transferred, the
designation provided by the entity transferring custody pursuant to
paragraphs (b)(1) through (b)(8) of this section may be different from
the designation of the fuel when that same entity received custody.
(i) Any 500 ppm sulfur diesel fuel designated under this paragraph
(b) and containing visible evidence of red dye may not be designated as
motor vehicle diesel fuel.
(ii) Any distillate fuel containing greater than or equal to 0.10
milligrams
[[Page 39193]]
per liter of marker solvent yellow 124 required under Sec. 80.510(d),
(e), or (f) must be designated as heating oil except that from June 1,
2010 through October 1, 2012 it may also be designated as LM diesel
fuel as specified under Sec. 80.510(e).
(iii) Any batch of #1D fuel which is suitable for use as
MVNRLM diesel fuel and which is also suitable for use as kerosene or
jet fuel (i.e., commonly referred to as dual use kerosene) may be
designated as either MVNRLM diesel fuel, kerosene, or jet fuel (as
applicable).
(iv) Any MVNRLM diesel fuel with a sulfur content of 500 ppm or
less in inventory as of June 1, 2007 may be designated as motor vehicle
diesel fuel.
(v) Batches or portions of batches of fuel received designated as
15 ppm sulfur #2D motor vehicle diesel fuel may be re-
designated as 500 ppm sulfur motor vehicle diesel fuel, but only in
accordance with the limitations of Sec. 80.527(c).
(vi) Batches or portions of batches received designated as 500 ppm
sulfur NRLM diesel fuel may be re-designated as 500 ppm sulfur motor
vehicle diesel fuel by a truck loading terminal only if the terminal
maintains a neutral or positive balance at the end of each quarterly
compliance period on their motor vehicle diesel fuel volume from June
1, 2007 as calculated in Sec. 80.599(b)(4).
(vii) Batches or portions of batches received designated as 500 ppm
sulfur NRLM diesel fuel may be re-designated as 500 ppm sulfur motor
vehicle diesel fuel by a facility other than a truck loading terminal
only if the following restrictions are met:
(A) At the end of each annual compliance period, the facility has a
neutral or positive balance on its motor vehicle diesel fuel volume
from June 1, 2007 as calculated in Sec. 80.599(b)(4); and
(B) At the end of each annual compliance period, the facility's
balance for motor vehicle diesel fuel volume, from the beginning of the
compliance period must be less than two percent of the total volume of
motor vehicle diesel fuel received during the compliance period, as
calculated in Sec. 80.599(b)(5).
(viii) For facilities in areas other than those specified in Sec.
80.510(g)(1) and (g)(2), batches or portions of batches of unmarked
distillate received designated as heating oil may be re-designated as
NRLM or LM diesel fuel only if the following restrictions are met:
(A) From June 1, 2007 through May 31, 2010, for any compliance
period, the volume of high sulfur NRLM diesel fuel delivered from a
facility cannot be greater than the volume received, unless the volume
of heating oil delivered from the facility is also greater than the
volume it received by an equal or greater proportion, as calculated in
Sec. 80.599(c)(2); and
(B) Beginning June 1, 2010, for any compliance period, the volume
of fuel designated as heating oil delivered from a facility cannot be
less than the volume of fuel designated as heating oil received, as
calculated in Sec. 80.599(c)(4).
(ix) For facilities in areas other than those specified in Sec.
80.510(g)(1) and (g)(2), from June 1, 2010 through May 31, 2012,
batches or portions of batches received designated as 500 ppm LM diesel
fuel may be redesignated as 500 ppm NR diesel fuel only if for any
compliance period the following restrictions are met:
(A) The volume of fuel designated as 500 ppm sulfur NR diesel fuel
delivered from the facility cannot be greater than the volume received
as calculated in Sec. 80.599(d)(2)(i); or
(B) The volume of fuel designated as 500 ppm sulfur NR diesel fuel
delivered from the facility in relation to the volume received is not a
greater proportion than the volume of fuel designated as 500 ppm sulfur
LM diesel fuel delivered from the facility in relation to the volume
received, as calculated in Sec. 80.599(d)(2)(ii).
(x) Notwithstanding the provisions of paragraph (b)(5) of this
section, beginning October 1, 2007,
(A) No distillate fuel with a sulfur content greater than 500 ppm
distributed or intended for distribution in the areas specified in
Sec. 80.510(g)(1) and (g)(2), may be designated as NRLM diesel fuel,
including LM diesel fuel except as provided in paragraph (b)(9)(xiii)
of this section; and
(B) Distillate fuel with a sulfur content greater than 500 ppm
distributed from within the areas specified in Sec. 80.510(g)(1) and
(g)(2) to areas outside these areas is subject to the provisions of
paragraph (b)(5) of this section.
(xi) Notwithstanding the provisions of paragraphs (b)(6) through
(b)(8) of this section, beginning October 1, 2010--
(A) No distillate fuel with a sulfur content greater than 15 ppm
distributed or intended for distribution in the areas specified in
Sec. 80.510(g)(1) and (g)(2), may be designated as NR diesel fuel,
except as provided in paragraph (b)(9)(xiv) of this section; and
(B) Distillate fuel with a sulfur content greater than 15 ppm
distributed from within the areas specified in Sec. 80.510(g)(1) and
(g)(2) to areas outside these areas is subject to the provisions of
paragraphs (b)(6) through (b)(7) of this section.
(xii) Notwithstanding the provisions of paragraphs (b)(7) and (8)
of this section, beginning October 1, 2012--
(A) No distillate fuel with a sulfur content greater than 15 ppm
distributed or intended for distribution in the areas specified in
Sec. 80.510(g)(1) and (g)(2), may be designated as NRLM diesel fuel,
including LM diesel fuel, except as provided in paragraph (b)(9)(xv) of
this section; and
(B) Distillate fuel with a sulfur content greater than 15 ppm
distributed from within the areas specified in Sec. 80.510(g)(1) and
(g)(2) to areas outside these areas is subject to the provisions of
paragraphs (b)(7) and (8) of this section.
(xiii) From June 1, 2007 through September 30, 2010, in the area
specified in Sec. 80.510(g)(2) only segregated batches of distillate
fuel received designated as HSNRLM diesel fuel may be distributed
designated as HSNRLM diesel fuel and must remain segregated from fuel
with any other designations unless otherwise approved by EPA in a
refiner compliance plan under Sec. 80.554(a)(4).
(xiv) From June 1, 2010 through September 30, 2012, in the area
specified in Sec. 80.510(g)(2) only segregated batches of distillate
fuel received designated as 500 ppm sulfur NR diesel fuel may be
distributed designated as 500 ppm sulfur NR diesel fuel and must remain
segregated from fuel with any other designations and from any other 500
ppm sulfur NRLM diesel fuel from any other sources, except as approved
by EPA in a refiner compliance plan under Sec. 80.554(a)(4).
(xv) From June 1, 2012 through September 30, 2014, in the area
specified in Sec. 80.510(g)(2) only segregated batches of distillate
fuel received designated as 500 ppm sulfur NRLM diesel fuel may be
distributed designated as 500 ppm sulfur NRLM diesel fuel and must
remain segregated from fuel with any other designations and from any
other 500 ppm sulfur NRLM diesel fuel from any other sources, except as
approved by EPA in a refiner compliance plan under Sec. 80.554(a)(4).
(c) Notwithstanding the provisions of paragraph (b) of this
section, an entity is not required to designate heating oil that is
delivered from a facility that only receives heating oil which is
marked pursuant to Sec. 80.510(d) through (f).
(d) Notwithstanding the provisions of paragraph (b)(4) of this
section, an entity is not required to designate 500 ppm sulfur MVNRLM
diesel fuel that is delivered from a facility that only receives 500
ppm sulfur MVNRLM diesel fuel on which taxes have been
[[Page 39194]]
paid or into which red dye has been added pursuant to Sec. 80.520(b).
(e) Notwithstanding the provisions of paragraph (b)(6) of this
section, an entity is not required to designate 500 ppm sulfur LM
diesel fuel that is delivered from a facility that only receives 500
ppm sulfur LM diesel fuel which is marked pursuant to Sec. 80.510(e).
(f) Any entity that is both a distributor and a refiner or importer
must comply with the provisions of paragraph (a) of this section for
all distillate fuel produced or imported, and the provisions of
paragraph (b) of this section for all distillate fuel for which it
acted as distributor but not refiner or importer.
(g) No refiner, importer, or distributor may use the designation
provisions of this section to circumvent the standards or requirements
of Sec. 80.510, 80.511, or 80.520.
? 56. A new Sec. 80.599 is added to read as follows:
Sec. 80.599 How do I calculate volume balances for designation purposes?
(a) Quarterly compliance periods. The quarterly compliance periods
are shown in the following table:
------------------------------------------------------------------------
Beginning date of quarterly compliance Ending date of quarterly
period compliance period
------------------------------------------------------------------------
June 1, 2007.............................. September 30, 2007.
October 1, 2007........................... December 31, 2007.
January 1, 2008........................... March 31, 2008.
April 1, 2008............................. June 30, 2008.
July 1, 2008.............................. September 30, 2008.
October 1, 2008........................... December 31, 2008.
January 1, 2009........................... March 31, 2009.
April 1, 2009............................. June 30, 2009.
July 1, 2009.............................. September 30, 2009.
October 1, 2009........................... December 31, 2009.
January 1, 2010........................... March 31, 2010.
April 1, 2010............................. May 31, 2010.
June 1, 2010.............................. September 30, 2010.
------------------------------------------------------------------------
(1) Annual compliance periods. The annual compliance periods before
the period beginning July 1, 2015 are shown in the following table:
------------------------------------------------------------------------
Beginning date of annual compliance Ending date of annual
period compliance period
------------------------------------------------------------------------
June 1, 2007.............................. June 30, 2008.
July 1, 2008.............................. June 30, 2009.
July 1, 2009.............................. May 31, 2010.
June 1, 2010.............................. June 30, 2011.
July 1, 2011.............................. May 31, 2012.
June 1, 2012.............................. June 30, 2013.
July 1, 2013.............................. May 31, 2014.
June 1, 2014.............................. June 30, 2015.
------------------------------------------------------------------------
(2) The annual compliance periods for the period beginning July 1,
2015 shall be from July 1, through June 30.
(b) Volume balance for motor vehicle diesel fuel. (1) A facility's
motor vehicle diesel fuel volume balance is calculated as follows:
MVB = MVI-MVO-MVINVCHG
Where:
MVB = the volume balance for motor vehicle diesel fuel for the
compliance period.
MVI = the total volume of all batches of fuel designated
as motor vehicle diesel fuel received for the compliance period.
MVO = the total volume of all batches of fuel designated
as motor vehicle diesel fuel delivered for the compliance period.
MVINVCHG = the total volume of 15 ppm sulfur and 500 ppm
sulfur motor vehicle diesel fuel in inventory at the end of the
compliance period minus the total volume of 15 ppm sulfur and 500
ppm sulfur motor vehicle diesel fuel in inventory at the beginning
of the compliance period, including accounting for any corrections
in inventory due to volume swell or shrinkage, difference in
measurement calibration between receiving and delivering meters, and
similar matters, where corrections that increase inventory are
defined as positive.
(2) Calculate the motor vehicle diesel fuel received, as follows:
MVI = MV15I + MV500I
Where:
MV15I = the total volume of all batches of fuel
designated as 15 ppm sulfur motor vehicle diesel fuel received for
the compliance period.
MV500I = the total volume of all batches of fuel
designated as 500 ppm sulfur motor vehicle diesel fuel received for
the compliance period.
(3) Calculate the motor vehicle diesel fuel delivered, as follows:
MVO = MV15O + MV500O
Where:
MV15O = the total volume of all batches of fuel
designated as 15 ppm sulfur motor vehicle diesel fuel and delivered
during the compliance period.
MV500O = the total volume of all batches of fuel
designated as 500 ppm sulfur motor vehicle diesel fuel and delivered
during the compliance period.
(4) The neutral or positive volume balance required for purposes of
compliance with Sec. 80.598(b)(9)(vi) and (b)(9)(vii)(A) means that
the net balance of motor vehicle diesel fuel in inventory as of the end
of the last day of the compliance period (MVNBE) must be
greater than or equal to zero. MVNBE is defined by the
following equation:
MVNBE = MV15BINV + MV500BINV
[sigma]MVB
Where:
MV15BINV = the total volume of fuel designated as 15 ppm
sulfur motor vehicle diesel fuel in inventory at the beginning of
the program on June 1, 2007.
MV500BINV = the total volume of fuel designated as 500
ppm sulfur motor vehicle diesel fuel in inventory at the beginning
of the program on June 1, 2007. Any #2D 500 ppm sulfur
MVNRLM in inventory at the beginning of the program on June 1, 2007
may be designated as motor vehicle diesel fuel.
[sigma]MVB = the sum of the balances for motor vehicle diesel fuel
for the current compliance period and previous compliance periods.
(5) The volume balance required for purposes of compliance with
Sec. 80.598(b)(9)(vii)(B) means:
-MVB <= 0.02 x MVI
(6) Calculations in paragraphs (b)(4) and (b)(5) of this section
may be combined for all facilities wholly owned by an entity.
(7) For purposes of calculations in paragraphs (b)(1) through
(b)(5) of this section, for batches of fuel received from facilities
without an EPA facility ID#, any batches of fuel received on
which taxes have been paid pursuant to IRS code (26 CFR part 48) shall
be deemed to be MV15I or MV500I as appropriate
for purposes of this paragraph.
(c) Volume balance for high sulfur NRLM diesel fuel and heating
oil. (1) A facility's high sulfur NRLM balance is calculated as follows:
HSNRLMB = HSNRLMII - HSNRLMO -
HSNRLMINVCHG
Where:
HSNRLMB = the balance for high sulfur NRLM diesel fuel for the
compliance period.
HSNRLMI = the total volume of all batches of fuel
designated as high sulfur NRLM received diesel fuel for the
compliance period.
HSNRLMO = the total volume of all batches of fuel
designated as high sulfur NRLM diesel fuel delivered for the
compliance period.
HSNRLMINVCHG = the volume of high sulfur NRLM diesel fuel
in inventory at the end of the compliance period minus the volume of
high sulfur NRLM diesel fuel in inventory at the beginning of the
compliance period, including accounting for any corrections in
inventory due to volume swell or shrinkage, difference in
measurement calibration between receiving and delivering meters, and
similar matters, where corrections that increase inventory are
defined as positive.
(2) The volume balance required for purposes of compliance with
Sec. 80.598(b)(9)(viii)(A) means one of the following:
(i) HSNRLMB >= 0
(ii) (HSNRLMO + HSNRLMINVCHG) /
HSNRLMI <= (HOO + HOINVCHG) /
HOI
(3) A facility's heating oil volume balance is calculated as
follows:
HOB = HOI - HOO - HOINVCHG
Where:
HOB = the balance for heating oil for the compliance period.
[[Page 39195]]
HOI = the total volume of all batches of fuel designated
as heating oil received for the compliance period.
HOO = the total volume of all batches of fuel designated
as heating oil delivered to all downstream entities for the
compliance period.
HOINVCHG = the volume of heating oil in inventory at the
end of the compliance period minus the volume of heating oil in
inventory at the beginning of the compliance period, including
accounting for any corrections in inventory due to volume swell or
shrinkage, difference in measurement calibration between receiving
and delivering meters, and similar matters, where corrections that
increase inventory are defined as positive.
(4) The volume balance required for purposes of compliance with Sec.
80.598(b)(9)(viii)(B) means:
HOB < = 0
(5) Calculations in paragraphs (c)(3) and (c)(4) of this section
may be combined for all facilities wholly owned by an entity.
(6) For purposes of calculations in paragraphs (c)(1) through
(c)(4) of this section, for batches of fuel received from facilities
without an EPA facility ID#, any batches of fuel received
marked pursuant to Sec. 80.510(d) or (f) shall be deemed to be
HOI, any batches of fuel received marked pursuant to Sec.
80.510(e) shall be deemed to be HOI or LM500I,
any diesel fuel with less than or equal to 500 ppm sulfur that is dyed
pursuant to Sec. 80.520(b) and not marked pursuant to Sec. 80.510(d)
or (f) shall be deemed to be NRLM diesel fuel, and any diesel fuel with
less than or equal to 500 ppm sulfur which is dyed pursuant to Sec.
80.520(b) and not marked pursuant to Sec. 80.510(e) shall be deemed to
be NR diesel fuel.
(d) Volume balance for NR diesel fuel. (1) A facility's 500 ppm
nonroad diesel fuel balance is calculated as follows:
NR500B = NR500I - NR500O -
NR500INVCHG
Where:
NR500B = the balance for 500 ppm sulfur NR diesel fuel for the
compliance period.
NR500I = the total volume of all batches of fuel
designated as 500 ppm sulfur NR diesel fuel received for the
compliance period.
NR500O = the total volume of all batches of fuel
designated as 500 ppm sulfur NR diesel fuel delivered for the
compliance period.
NR500INVCHG = the volume of 500 ppm sulfur NR diesel fuel
in inventory at the end of the compliance period minus the volume of
500 ppm sulfur NR diesel fuel in inventory at the beginning of the
compliance period, and accounting for any corrections in inventory
due to volume swell or shrinkage, difference in measurement
calibration between receiving and delivering meters, and similar
matters, where corrections that increase inventory are defined as
positive.
(2) The volume balance required for purposes of compliance with Sec.
80.598(b)(9)(ix) means one of the following:
(i) NR500B >= 0
(ii) (NR500O + NR500INVCHG) /
NR500I <= (LM500O + LM500INVCHG) /
LM500I.
Where:
LM500I = the total volume of all batches of fuel
designated as 500 ppm sulfur LM diesel fuel received for the
compliance period.
LM500O = the total volume of all batches of fuel
designated as 500 ppm sulfur LM diesel fuel delivered for the
compliance period.
LM500INVCHG = the volume of 500 ppm sulfur LM diesel fuel
in inventory at the end of the compliance period minus the volume of
500 ppm sulfur LM diesel fuel in inventory at the beginning of the
compliance period, and accounting for any corrections in inventory
due to volume swell or shrinkage, difference in measurement
calibration between receiving and delivering meters, and similar
matters, where corrections that increase inventory are defined as
positive.
(e) Anti-downgrading for motor vehicle diesel fuel. (1) A facility
must satisfy the provisions in either paragraphs (e)(2), (e)(3),
(e)(4), or (e)(5) of this section to comply with the anti-downgrading
limitation of paragraph Sec. 80.527(c)(1), for the annual compliance
periods defined in Sec. 80.527(c)(3).
(2) The volume of #2D 15 ppm sulfur motor vehicle delivered
must meet the following requirement:
(#2MV15O + #2MV15INVCHG) >=
0.8 x #2MV15I
Where:
#2MV15O = the total volume of fuel delivered
during the compliance period that is designated as #2D 15
ppm sulfur motor vehicle diesel fuel.
#2MV15INVCHG = the total volume of diesel fuel
designated as #2D 15 ppm sulfur motor vehicle diesel fuel in
inventory at the end of the compliance period minus the total volume
of #2D 15 ppm sulfur motor vehicle diesel fuel in inventory
at the beginning of the compliance period, and accounting for any
corrections in inventory due to volume swell or shrinkage,
difference in measurement calibration between receiving and
delivering meters, and similar matters, where corrections that
increase inventory are defined as positive.
#2MV15I = the total volume of fuel received
during the compliance period that is designated as #2D 15
ppm sulfur motor vehicle diesel fuel.
(3) The volume of #2D 500 ppm sulfur motor vehicle diesel
fuel delivered must meet the following requirement:
#2MV500O <= #2MV500I -
#2MV500INVCHG + 0.2 x #2MV15I
Where:
#2MV500O = the total volume of fuel delivered
during the compliance period that is designated as #2D 500
ppm sulfur motor vehicle diesel fuel.
#2MV500I = the total volume of fuel received
during the compliance period that is designated as #2D 500
ppm sulfur motor vehicle diesel fuel.
#2MV500INVCHG = the total volume of diesel fuel
designated as #2D 500 ppm sulfur motor vehicle diesel fuel
in inventory at the end of the compliance period minus the total
volume of #2D 500 ppm sulfur motor vehicle diesel fuel in
inventory at the beginning of the compliance period, and accounting
for any corrections in inventory due to volume swell or shrinkage,
difference in measurement calibration between receiving and
delivering meters, and similar matters, where corrections that
increase inventory are defined as positive.
(4) The following calculation may be used to account for wintertime
blending of kerosene:
#2MV500O <= #2MV500I -
#2MV500INVCHG + 0.2 * (#1MV15I
+ #2MV15I)
Where:
#1MV15I = the total volume of fuel received
during the compliance period that is designated as #1D 15
ppm sulfur motor vehicle diesel fuel.
(5) The following calculation may be used to account for wintertime
blending of kerosene and/or changes in the facility's volume balance of
motor vehicle diesel fuel resulting from a temporary shift of 500 ppm
sulfur NRLM diesel fuel to 500 ppm sulfur motor vehicle diesel fuel
during the compliance period:
#2MV500O < #2MV500I -
#2MV500INVCHG + 0.2 * #2MV15I
+ #1MV15B + #2NRLM500S
Where:
#1MV15B = the total volume of fuel received
during the compliance period that is designated as #1D 15
ppm sulfur motor vehicle diesel fuel and that the facility can
demonstrate they blended into #2D 500 ppm sulfur motor
vehicle diesel fuel.
#2NRLM500S = the total volume of #2D 500
ppm sulfur NRLM diesel fuel that the facility can demonstrate they
redesignated as #2D 500 ppm sulfur motor vehicle diesel fuel
during the compliance period.
(f) Inventory adjustments. Adjustments to inventory under this
section must be based on normal business practices for the industry,
appropriate physical plant operations and use of good engineering
judgments.
(g) Unique circumstances. EPA may, at its discretion, grant a fuel
distributor's application to modify its inventory of motor vehicle
diesel fuel, NRLM diesel fuel, or heating oil for a
[[Page 39196]]
given compliance period. EPA may grant an application to address unique
circumstances, where appropriate, such as the start up of a new
pipeline or pipeline segment.
? 57. The center header ``EXEMPTIONS'' before Sec. 80.600 is removed.
? 58. Section 80.600 is revised to read as follows:
Sec. 80.600 What records must be kept for purposes of the designate
and track provisions?
(a) In addition to the requirements of Sec. 80.592 and Sec.
80.602, the following recordkeeping requirements shall apply to
refiners and importers:
(1) Any refiner or importer shall maintain the records specified in
paragraphs (a)(6) through (a)(10) of this section for each batch of
distillate fuel that it transfers custody of and designates during the
time period from June 1, 2006 through May 31, 2010, with the following
categories:
(i) #1D 15 ppm sulfur motor vehicle diesel fuel;
(ii) #2D 15 ppm sulfur motor vehicle diesel fuel;
(iii) 15 ppm sulfur NRLM diesel fuel;
(iv) #1D 500 ppm sulfur motor vehicle diesel fuel;
(v) #2D 500 ppm sulfur motor vehicle diesel fuel; or
(vi) 500 ppm sulfur NRLM diesel fuel.
(2) Any refiner or importer shall maintain the records specified in
paragraphs (a)(6) through (a)(10) of this section for each batch of
distillate fuel that it transfers custody of and designates during the
time period from June 1, 2007 through May 31, 2010 with the following
categories:
(i) High sulfur NRLM diesel fuel; or
(ii) Heating oil.
(3) Any refiner or importer shall maintain the records specified in
paragraphs (a)(6) through (a)(10) of this section for each batch of
distillate fuel that it transfers custody of and designates during the
time period from June 1, 2010 through May 31, 2012 with the following
categories:
(i) 500 ppm sulfur NR diesel fuel;
(ii) 500 ppm sulfur LM diesel fuel; or
(iii) Heating oil.
(4) Any refiner or importer shall maintain the records specified in
paragraphs (a)(6) through (a)(10) of this section for each batch of
distillate fuel that it transfers custody of and designates during the
time period from June 1, 2012 through May 31, 2014 with the following
categories:
(i) 500 ppm sulfur NRLM diesel fuel; or
(ii) Heating oil.
(5) Any refiner or importer shall maintain the records specified in
paragraphs (a)(6) through (a)(10) of this section for each batch of
heating oil that it transfers custody of and designates during the time
period from June 1, 2014 and later as belonging to the heating oil
category.
(6) The records for each batch with designations identified in
paragraphs (a)(1) through (a)(5) of this section must clearly and
accurately identify the batch number (including an indication as to
whether the batch was received into the facility or delivered from the
facility), date and time of day (if multiple batches are delivered per
day) that custody was transferred, the designation, the volume in
gallons of the batch, and the name and the EPA entity and facility
registration number of the facility to whom such batch was transferred.
(i) For motor vehicle diesel fuel, the records must also identify
whether the batch was received or delivered with or without taxes paid
pursuant to Section 4082 of the Internal Revenue Code (26 U.S.C. 4082).
(ii) For NRLM diesel fuel, the records must also identify whether
the batch was received or delivered with or without dye added pursuant
to Section 4082 of the Internal Revenue Code (26 U.S.C. 4082).
(iii) For heating oil, the records must also identify whether the
batch was received or delivered with or without the marker added
pursuant to Sec. 80.510(d) through (f).
(iv) For LM diesel, the records must also identify whether the
batch was received or delivered with or without the marker added
pursuant to Sec. 80.510(e).
(7) Any refiner or importer shall, for each of its facilities,
maintain records that clearly and accurately identify the total volume
in gallons of designated fuel identified in paragraphs (a)(1) through
(a)(5) of this section transferred over each compliance period. The
records shall be maintained separately for each fuel designated in
paragraphs (a)(1) through (a)(5) of this section, and for each EPA
entity and facility registration number to whom custody of the fuel was
transferred.
(8) Notwithstanding the provisions of paragraphs (a)(6) and (a)(7)
of this section, records of batches delivered of 500 ppm sulfur motor
vehicle diesel fuel on which taxes have been paid per Section 4082 of
the Internal Revenue Code (26 U.S.C. 4082) and of 500 ppm sulfur NRLM
diesel fuel into which dye has been added per Section 4082 of the
Internal Revenue Code (26 U.S.C. 4082), and of 500 ppm sulfur LM diesel
fuel which has been properly marked pursuant to Sec. 80.510(e) are not
required to be maintained separately for each entity and facility to
which the fuel was delivered.
(9) Notwithstanding the provisions of paragraphs (a)(6) and (a)(7)
of this section, records of heating oil batches delivered that have
been properly marked pursuant to Sec. 80.510(d) through (f) and
records of LM diesel fuel batches delivered that have been properly
marked pursuant to Sec. 80.510(e) are not required to be maintained
separately for each entity and facility to which the fuel was delivered.
(10) Any refiner or importer shall maintain copies of all product
transfer documents required under Sec. 80.590. If all information
required in paragraph (a)(6) of this section is on the product transfer
document for a batch, then the provisions of this paragraph (a)(10)
shall satisfy the requirements of paragraph (a)(6) of this section for
that batch.
(11) Any refiner or importer shall maintain records related to
annual compliance calculations performed under Sec. 80.599 and to
information required to be reported to the Administrator under Sec.
80.601.
(12) Records must be maintained that demonstrate compliance with a
refiner's compliance plan required under Sec. 80.554, for distillate
fuel designated as high sulfur NRLM diesel fuel and delivered from June
1, 2007 through May 31, 2010, for distillate fuel designated as 500 ppm
sulfur NR diesel fuel and delivered from June 1, 2010 through May 31,
2012, and for distillate fuel designated as 500 ppm sulfur NRLM diesel
fuel and delivered from June 1, 2012 through June 1, 2014 in the areas
specified in Sec. 80.510(g)(2).
(b) In addition to the requirements of Sec. 80.592 and Sec.
80.602, the following recordkeeping requirements shall apply to
distributors:
(1) Any distributor shall maintain the records specified in
paragraphs (b)(2) through (b)(10) of this section for each batch of
distillate fuel with the following designations for which custody is
received or delivered. Records shall be kept separately for each of its
facilities.
(i) For each facility that receives #2D 15 ppm sulfur motor
vehicle diesel fuel and distributes any #2D 500 ppm sulfur
motor vehicle diesel fuel, records for each batch of diesel fuel with
the following designations for which custody is received or delivered
during the time period from June 1, 2006 through May 31, 2007:
(A) #1D 15 ppm sulfur motor vehicle diesel fuel;
(B) #2D 15 ppm sulfur motor vehicle diesel fuel;
(C) #2D 500 ppm sulfur motor vehicle diesel fuel; or
[[Page 39197]]
(D) 500 ppm sulfur NRLM diesel fuel.
(ii) For each facility, records for each batch of diesel fuel with
the following designations for which custody is received or delivered
during the time period from June 1, 2007 through May 31, 2010:
(A) #1D 15 ppm sulfur motor vehicle diesel fuel;
(B) #2D 15 ppm sulfur motor vehicle diesel fuel;
(C) #1D 500 ppm sulfur motor vehicle diesel fuel;
(D) #2D 500 ppm sulfur motor vehicle diesel fuel;
(E) 500 ppm sulfur NRLM diesel fuel;
(F) 15 ppm sulfur NRLM diesel fuel;
(G) High sulfur NRLM diesel fuel; or
(H) Heating oil.
(iii) For each facility that receives unmarked fuel designated as
NR diesel fuel, LM diesel fuel or heating oil, records for each batch
of diesel fuel with the following designations for which custody is
received or delivered during the time period from June 1, 2010 through
May 31, 2012:
(A) 500 ppm sulfur NR diesel fuel;
(B) 500 ppm sulfur LM diesel fuel; or
(C) Heating oil.
(iv) For each facility that receives unmarked fuel designated as
heating oil, records for each batch of diesel fuel with the following
designations for which custody is received or delivered during the time
period from June 1, 2012 through May 31, 2014:
(A) 500 ppm sulfur NRLM diesel fuel; or
(B) Heating oil.
(v) For each facility that receives unmarked fuel designated as
heating oil, records for each batch of diesel fuel with the following
designations for which custody is received or delivered during the time
period beginning June 1, 2014:
(A) 500 ppm sulfur LM diesel fuel; or
(B) Heating oil.
(vi) From June 1, 2007 through May 31, 2010, for those facilities
in the areas specified in Sec. 80.510(g)(2) that receive unmarked fuel
designated as high sulfur NRLM diesel fuel:
(A) High sulfur NRLM diesel fuel; or
(B) Heating oil.
(vii) From June 1, 2010 through May 31, 2012, for those facilities
in the areas specified in Sec. 80.510(g)(2) that receive unmarked fuel
designated as 500 ppm sulfur NR diesel fuel, 500 ppm sulfur LM diesel
fuel, or heating oil:
(A) 500 ppm sulfur NR diesel fuel;
(B) 500 ppm sulfur LM diesel fuel; or
(C) Heating oil.
(viii) From June 1, 2012 through May 31, 2014, for those facilities
in the areas specified in Sec. 80.510(g)(2) that receive unmarked fuel
designated as 500 ppm sulfur NRLM diesel fuel or heating oil.
(A) 500 ppm sulfur NRLM diesel fuel; or
(B) Heating oil.
(2) Records that for each batch clearly and accurately identify the
batch number (including an indication as to whether the batch was
received into the facility or delivered from the facility), date and
time of day (if multiple batches are delivered per day) that custody
was transferred, the designation, the volume in gallons of each batch
of each fuel, and the name and the EPA entity and facility registration
number of the facility to whom or from whom such batch was transferred.
(i) For motor vehicle diesel fuel the records must also identify
whether the batch was received or delivered with or without taxes paid
pursuant to section 4082 of the Internal Revenue Code (26 U.S.C. 4082).
(ii) For NRLM diesel fuel, the records must also identify whether
it was received or delivered with or without dye added pursuant to
Section 4082 of the Internal Revenue Code (26 U.S.C. 4082).
(iii) For heating oil, the records must also identify whether it
was received or delivered with or without the marker added pursuant to
Sec. 80.510(d) through (f).
(iv) For LM diesel fuel, the records must also identify whether it
was received or delivered with or without the marker added pursuant to
Sec. 80.510(e).
(v) For batches of fuel received from facilities without an EPA
facility registration number, any batches of fuel received marked
pursuant to Sec. 80.510(d) or (f) shall be deemed designated as
heating oil, any batches of fuel received marked pursuant to Sec.
80.510(e) shall be deemed designated as heating oil or LM diesel fuel,
any batches of fuel received on which taxes have been paid pursuant to
Section 4082 of the Internal Revenue Code (26 U.S.C. 4082) shall be
deemed designated as motor vehicle diesel fuel, any 500 ppm sulfur
diesel fuel dyed pursuant to Sec. 80.520(b) and not marked pursuant to
Sec. 80.510(d) or (f) shall be deemed designated as NRLM diesel fuel,
and any diesel fuel with less than or equal to 500 ppm sulfur which is
dyed pursuant to Sec. 80.520(b) and not marked pursuant to Sec.
80.510(e) shall be deemed to be NR diesel fuel.
(3) Records that clearly and accurately identify the total volume
in gallons of each designated fuel identified under paragraph (b)(1) of
this section transferred over each of the compliance periods, and over
the periods from June 1, 2007 to the end of each compliance period. The
records shall be maintained separately for each fuel designated under
paragraph (b)(1) of this section, and for each EPA entity and facility
registration number from whom the fuel was received or to whom it was
delivered. For batches of fuel received from facilities without an EPA
facility registration number, any batches of fuel received marked
pursuant to Sec. 80.510(d) or (f) shall be deemed designated as
heating oil, any batches of fuel received marked pursuant to Sec.
80.510(e) shall be deemed designated as heating oil or LM diesel fuel,
any batches of fuel received on which taxes have been paid pursuant to
Section 4082 of the Internal Revenue Code (26 U.S.C. 4082) shall be
deemed designated as motor vehicle diesel fuel, any 500 ppm sulfur
diesel fuel dyed pursuant to Sec. 80.520(b) and not marked pursuant to
Sec. 80.510(d) or (f) shall be deemed designated as NRLM diesel fuel,
and any diesel fuel with less than or equal to 500 ppm sulfur which is
dyed pursuant to Sec. 80.520(b) and not marked pursuant to Sec.
80.510(e) shall be deemed to be NR diesel fuel.
(4) Notwithstanding the provisions of paragraphs (b)(2) and (b)(3)
of this section, for batches of 500 ppm sulfur motor vehicle diesel
fuel delivered on which taxes have been paid per Section 4082 of the
Internal Revenue Code (26 U.S.C. 4082) and 500 ppm sulfur NRLM diesel
fuel into which red dye has been added per Section 4082 of the Internal
Revenue Code (26 U.S.C. 4082), records are not required to be
maintained separately for each entity or facility to whom fuel was
delivered.
(5) Notwithstanding the provisions of paragraphs (b)(2) and (b)(3)
of this section, for batches of heating oil delivered that are marked
pursuant to Sec. 80.510(d) through (f), records do not need to
identify the EPA entity or facility registration number to which fuel
was delivered.
(6) Notwithstanding the provisions of paragraphs (b)(2) and (b)(3)
of this section, for batches of LM diesel fuel delivered that are
marked pursuant to Sec. 80.510(e), records do not need to identify the
EPA entity or facility registration number to which fuel was delivered.
(7) Records that clearly and accurately reflect the beginning and
ending inventory volume for each of the fuels for which records must be
kept under paragraph (b)(1) of this section. Such records shall be
maintained separately by each entity and facility consistent with the
compliance periods defined in Sec. Sec. 80.598 and 80.599.
(8) (i) If adjustments are made to inventory, the records must
include detailed information related to the amount, type of, and reason
for such adjustment.
[[Page 39198]]
(ii) If adjustments are made because of measurement error or
variation, the records must include the adjustment made, the meter or
gauge or other reading(s), and the name of the person who took such
reading(s) and or applied the adjustment.
(9) For distributors that are required to keep records under
paragraphs (b)(1) through (b)(8) of this section for truck loading
terminals, records related to quarterly or annual compliance
calculations, as applicable, performed under Sec. 80.599 and to
information required to be reported to the Administrator under Sec.
80.601.
(10) For distributors that are required to keep records under
paragraphs (b)(1) through (b)(8) of this section for facilities other
than truck loading terminals, records related to annual compliance
calculations performed under Sec. 80.599 and to information required
to be reported to the Administrator under Sec. 80.601.
(c) Notwithstanding the provisions of paragraph (b) of this
section, records of heating oil received are not required to be
maintained for facilities that do not receive any heating oil which is
unmarked pursuant to Sec. 80.510(d) through (f), or LM diesel fuel
which is unmarked pursuant to Sec. 80.510(e).
(d) Notwithstanding the provisions of paragraph (b) of this
section, records of 500 ppm sulfur MVNRLM diesel fuel received are not
required to be maintained for facilities that do not receive any motor
vehicle diesel fuel for which taxes have not already been paid pursuant
to Section 4082 of the Internal Revenue Code (26 U.S.C. 4082) or NRLM
diesel fuel which is undyed pursuant to Sec. 80.520(b).
(e) The provisions of paragraphs (b)(1)(iii) and (iv) of this
section do not apply to facilities located in the areas specified in
Sec. 80.510(g)(1) and (g)(2) unless they deliver marked heating oil or
LM diesel fuel to areas outside the areas specified in Sec.
80.510(g)(1) and (g)(2).
(f) Ultimate consumers that receive any batch of high sulfur NRLM
diesel fuel beginning June 1, 2007 in areas listed in Sec.
80.510(g)(2) must maintain records of each batch of fuel received for
use in NRLM equipment pursuant to the compliance plan provisions of
Sec. 80.554, unless otherwise allowed by EPA.
(g) Ultimate consumers that receive any batch of 500 ppm sulfur NR
diesel fuel beginning June 1, 2010 or NRLM diesel fuel beginning June
1, 2012 in the areas listed in Sec. 80.510(g)(2) must maintain records
of each batch of fuel received for use in NR or NRLM equipment, as
appropriate, pursuant to the compliance plan provisions of Sec.
80.554, unless otherwise allowed by EPA.
(h) For purposes of this section, each portion of a shipment of
designated distillate fuel under this section that is differently
designated from any other portion, even if shipped as fungible product
having the same sulfur content, shall be a separate batch.
(i) The records required in this section must be made available to
the Administrator or the Administrator's designated representative upon
request.
(j) Notwithstanding the provisions of this section, product
transfer documents must be maintained under the provisions of
Sec. Sec. 80.590, 80.592, and 80.602.
(k) The records required in this section must be kept for five
years after they are required to be collected.
(l) Identifications of fuel designations can be limited to a sub-
designation that accurately identifies the fuel and do not need to also
include the broader designation. For example, NR diesel fuel does not
also need to be designated as NRLM or MVNRLM diesel fuel.
? 59. Section 80.601 is revised to read as follows:
Sec. 80.601 What are the reporting requirements for purposes of the
designate and track provisions?
(a) Quarterly reporting. Beginning November 30, 2007 and continuing
through August 31, 2010, each entity required to maintain records under
Sec. 80.600 must report the following information separately for each
of its facilities to the Administrator on a quarterly basis, as
specified in paragraph (e)(1) of this section:
(1) Separately for each designation category and separately for
each transferee facility, the total volume in gallons of distillate
fuel designated under Sec. 80.598 for which custody was delivered by
the reporting facility to any other entity or facility, and the EPA
entity and facility registration number(s), as applicable, of the
transferee.
(2) Separately for each designation category and separately for
each transferor facility, the total volume in gallons of distillate
fuel designated under Sec. 80.598 for which custody was received by
the reporting facility, and the EPA entity and facility registration
number(s), as applicable, of the transferor.
(3) Any entity that receives custody of distillate fuel from
another entity or facility that does not have an EPA facility
identification number must report such batches as follows:
(i) Any batch of distillate fuel for which custody is received and
which is marked pursuant to Sec. 80.510(d) or (f) shall be deemed
designated as heating oil, any batch of distillate fuel for which
custody is received and which is marked pursuant to Sec. 80.510(e)
shall be deemed designated as heating oil or LM diesel fuel as
applicable, and the report shall include that information under that
designation.
(ii) Any batch of distillate fuel for which custody is received and
for which taxes have been paid pursuant to Section 4082 of the Internal
Revenue Code (26 U.S.C. 4082) shall be deemed designated as motor
vehicle diesel fuel and the report shall include it under that
designation.
(iii) Any batch of 500 ppm sulfur diesel fuel dyed pursuant to
Sec. 80.520(b) and not marked pursuant to Sec. 80.510(d) and (f), and
for which custody is received, shall be deemed designated as NRLM
diesel fuel and the report shall include it under that designation.
(iv) Any batch of 500 ppm sulfur diesel fuel dyed pursuant to Sec.
80.520(b) and not marked pursuant to Sec. 80.510(e), and for which
custody is received, shall be deemed designated as NR diesel fuel and
the report shall include it under that designation.
(4) In the case of truck loading terminals, the results of all
compliance calculations required under Sec. 80.599, and including:
(i) The total volumes received of each fuel designation required to
be reported in paragraphs (a)(1) through (a)(3) of this section over
the quarterly compliance period.
(ii) The total volumes delivered of each fuel designation required
to be reported in paragraphs (a)(1) through (a)(3) of this section over
the quarterly compliance period.
(iii) Beginning and ending inventories of each fuel designation
required to be reported in paragraphs (a)(1) through(a)(3) of this
section over the quarterly compliance period.
(iv) The volume balance under Sec. 80.599(b)(4) and Sec.
80.598(b)(9)(vi).
(v) The volume balance under Sec. 80.599(c)(2) and Sec.
80.598(b)(9)(viii)(A).
(b) Annual reports. Beginning August 31, 2007, all entities
required to maintain records for batches of fuel under Sec. 80.600
must report the following information separately for each of its
facilities to the Administrator on an annual basis, as specified in
paragraph (e)(2) of this section:
(1) Separately for each designation category for which records are
required to be kept under Sec. 80.600 and separately for each
transferor facility, the total volume in gallons of distillate fuel
designated under Sec. 80.598 for which custody was received by the
reporting
[[Page 39199]]
facility, and the EPA entity and facility registration number(s), as
applicable, of the transferor.
(2) Separately for each designation category for which records are
required to be kept under Sec. 80.600 and separately for each
transferee facility, the total volume in gallons of distillate fuel
designated under Sec. 80.598 for which custody was delivered by the
reporting facility to any other entity or facility, and the EPA entity
and facility registration number(s), as applicable, of the transferee
except as provided under Sec. 80.600(a)(7), (a)(8), (b)(4), and
(b)(5).
(3) The results of all compliance calculations required under Sec.
80.599, and including:
(i) The total volumes in gallons received of each fuel designation
required to be reported in paragraph (b)(1) of this section over the
applicable annual compliance period.
(ii) The total volumes in gallons delivered of each fuel
designation required to be reported in paragraph (b)(2) of this section
over the applicable annual compliance period.
(iii) Beginning and ending inventories of each fuel designation
required to be reported in paragraphs (b)(1) and (b)(2) of this section
for the annual compliance period.
(iv) In the areas specified in Sec. 80.510(g)(2), for fuel
designated as high sulfur NRLM diesel fuel delivered from June 1, 2007
through May 31, 2010, for fuel designated as 500 ppm NR diesel fuel
delivered from June 1, 2010 through May 31, 2012, and for fuel
designated as 500 ppm sulfur NRLM diesel fuel from June 1, 2012 through
May 31, 2014, the refiner must report all information required under
its compliance plan approved pursuant to Sec. 80.554(a)(4) and (b)(4)
and including the ultimate consumers to whom each batch of fuel was
delivered and the total delivered to each ultimate consumer for the
compliance period.
(v) Ending with the report due August 31, 2010, the volume balance
under Sec. 80.598(b)(9)(vi) and Sec. 80.599(b)(4).
(vi) Ending with the report due August 31, 2010, the volume balance
under Sec. 80.598(b)(9)(vii) and Sec. 80.599(b)(5), if applicable.
(vii) Ending with the report due August 31, 2010, the volume
balance under Sec. 80.598(b)(9)(viii)(A) and Sec. 80.599(c)(2).
(viii) Beginning with the report due August 31, 2010, the volume
balance under Sec. 80.598(b)(8)(viii)(B) and Sec. 80.599(c)(4).
(ix) Beginning with the report due August 1, 2011 and ending with
the report due August 1, 2012, the volume balance under Sec.
80.598(b)(9)(ix) and Sec. 80.599(d)(2).
(c) Additional information. The Administrator may request any
additional information necessary to determine compliance with the
requirements of Sec. Sec. 80.598 and 80.599.
(d) Submission of quarterly and annual reports. (1) All quarterly
reports shall be submitted to the Administrator for the compliance
periods defined in Sec. 80.599(a)(1) as follows:
(i) The first quarter report shall be submitted by the following
November 30.
(ii) The second quarter report shall be submitted by the following
February 28.
(iii) The third quarter report shall be submitted by the following
May 31.
(iv) The fourth quarter report shall be submitted by the following
August 31.
(2) All annual reports shall be submitted to the Administrator for
the compliance periods defined in Sec. 80.599(a)(2) by August 31.
(3) All reports shall be submitted on forms and following
procedures specified by the Administrator, shall include a statement
that volumes reported to the Administrator under this section are
identical to volumes reported to the Internal Revenue Service and shall
be signed and certified by a responsible corporate officer of the
reporting entity.
(e) Exclusions. Notwithstanding the provisions of this section, an
entity is not required to report under paragraphs (a) or (b) of this
section for facilities whose only recordkeeping requirements under
Sec. 80.600 are under Sec. 80.600 (f) or (g) or to maintain records
solely related to calculating compliance with the downgrading
limitation under Sec. 80.527, Sec. 80.599(e) and Sec.
80.600(b)(1)(i) and (ii).
? 60. Section 80.602 is revised to read as follows:
Sec. 80.602 What records must be kept by entities in the NRLM diesel
fuel and diesel fuel additive production, importation, and distribution
systems?
(a) Records that must be kept by parties in the NRLM diesel fuel
and diesel fuel additive production, importation, and distribution
systems. Beginning June 1, 2007, or June 1, 2006, if that is the first
period credits are generated under Sec. 80.535, any person who
produces, imports, sells, offers for sale, dispenses, distributes,
supplies, offers for supply, stores, or transports nonroad, locomotive
or marine diesel fuel subject to the provisions of this subpart, must
keep the following records:
(1) The applicable product transfer documents required under
Sec. Sec. 80.590 and 80.591.
(2) For any sampling and testing for sulfur content for a batch of
NRLM diesel fuel produced or imported and subject to the 15 ppm sulfur
standard or any sampling and testing for sulfur content as part of a
quality assurance testing program, and any sampling and testing for
cetane index, aromatics content, marker solvent yellow 124 content or
dye solvent red 164 content of NRLM diesel fuel, NRLM diesel fuel
additives or heating oil:
(i) The location, date, time and storage tank or truck
identification for each sample collected;
(ii) The name and title of the person who collected the sample and
the person who performed the testing; and
(iii) The results of the tests for sulfur content (including where
applicable the test results with and without application of the
adjustment factor under Sec. 80.580(a)(4)), for cetane index or
aromatics content, dye solvent red 164, marker solvent yellow 124 (as
applicable), and the volume of product in the storage tank or container
from which the sample was taken.
(3) The actions the party has taken, if any, to stop the sale or
distribution of any NRLM diesel fuel found not to be in compliance with
the sulfur standards specified in this subpart, and the actions the
party has taken, if any, to identify the cause of any noncompliance and
prevent future instances of noncompliance.
(b) Additional records to be kept by refiners and importers of NRLM
diesel fuel. Beginning June 1, 2007, or June 1, 2006, pursuant to the
provisions of Sec. 80.535 or Sec. 80.554(d), any refiner producing
diesel fuel subject to a sulfur standard under Sec. 80.510, Sec.
80.513, Sec. 80.536, Sec. 80.554, Sec. 80.660, or Sec. 80.561, for
each of its refineries, and any importer importing such diesel fuel
separately for each facility, shall keep records that include the
following information for each batch of NRLM diesel fuel or heating oil
produced or imported:
(1) The batch volume.
(2) The batch number, assigned under the batch numbering procedures
under Sec. 80.65(d)(3).
(3) The date of production or import.
(4) A record designating the batch as one of the following:
(i) NRLM diesel fuel, NR diesel fuel, LM diesel fuel, or heating
oil, as applicable.
(ii) Meeting the 500 ppm sulfur standard of Sec. 80.510(a) or the
15 ppm sulfur standard of Sec. 80.510(b) and (c) or other applicable
standard.
(iii) Dyed or undyed with visible evidence of solvent red 164.
[[Page 39200]]
(iv) Marked or unmarked with solvent yellow 124.
(5) For foreign refiners and importers of their fuel, the
designations and other records required to be kept under Sec. 80.620.
(6) All of the following information regarding credits, kept
separately for each compliance period, kept separately for each
refinery and for each importer facility, kept separately if converted
under Sec. 80.535(a) and (b) or Sec. 80.535(c) and (d), and kept
separately from motor vehicle diesel fuel credits:
(i) The number of credits in the refiner's or importer's possession
at the beginning of the calendar year.
(ii) The number of credits generated.
(iii) The number of credits used.
(iv) If any were obtained from or transferred to other parties, for
each other party, its name, its EPA refiner or importer registration
number consistent with Sec. 80.597, and the number obtained from, or
transferred to, the other party.
(v) The number in the refiner's or importer's possession that will
carry over into the subsequent calendar year compliance period.
(vi) Commercial documents that establish each transfer of credits
from the transferor to the transferee.
(7) The calculations used to determine baselines or compliance with
the volume requirements and volume percentages, as applicable, under
this subpart.
(8) The calculations used to determine the number of credits generated.
(9) A copy of reports submitted to EPA under Sec. 80.604.
(c) Additional records importers must keep. Any importer shall keep
records that identify and verify the source of each batch of certified
DFR-Diesel and non-certified DFR-Diesel imported and demonstrate
compliance with the requirements under Sec. 80.620.
(d) Length of time records must be kept. The records required in
this section shall be kept for five years from the date they were
created, except that records relating to credit transfers shall be kept
by the transferor for five years from the date the credits were
transferred, and shall be kept by the transferee for five years from
the date the credits were transferred, used or terminated, whichever is
later.
(e) Make records available to EPA. On request by EPA, the records
required in this section must be made available to the Administrator or
the Administrator's representative. For records that are electronically
generated or maintained, the equipment and software necessary to read
the records shall be made available, or if requested by EPA, electronic
records shall be converted to paper documents which shall be provided
to the Administrator's authorized representative.
? 61. A new Sec. 80.603 is added to read as follows:
Sec. 80.603 What are the pre-compliance reporting requirements for
NRLM diesel fuel?
(a) Except as provided in paragraph (c) of this section, beginning
on June 1, 2005, and for each year until June 1, 2011, or until the
entity produces or imports NR or NRLM diesel fuel meeting the 15 ppm
sulfur standard of Sec. 80.510(b) or (c), all refiners and importers
planning to produce or import NR or NRLM diesel fuel, shall submit the
following information to EPA:
(1) Any changes to the information submitted for the company
registration;
(2) Any changes to the information submitted for any refinery or
import facility registration;
(3) Any estimate of the average daily volumes (in gallons) of each
sulfur grade of motor vehicle and NRLM diesel fuel produced (or
imported) at each refinery (or import facility). These volume estimates
must be provided both for fuel produced from crude oil, as well as any
fuel produced from other sources, and must be provided for the periods
of June 1, 2010 through December 31, 2010, calendar years 2011 through
2013, January 1, 2014 through May 31, 2014, and June 1, 2014 through
December 31, 2014;
(4) If expecting to participate in the credit trading program,
estimates of the number of credits to be generated and/or used each
year the program;
(5) Information on project schedule by quarter of known or
projected completion date by the stage of the project, for example,
following the five project phases described in EPA's June 2002 Highway
Diesel Progress Review report (EPA420-R-02-016, http://www.epa.gov/otaq/
regs/hd2007/420r02016.pdf): Strategic planning, Planning and
front-end engineering, Detailed engineering and permitting, Procurement
and construction, and Commissioning and startup;
(6) Basic information regarding the selected technology pathway for
compliance (e.g., conventional hydrotreating vs. other technologies,
revamp vs. grassroots, etc.);
(7) Whether capital commitments have been made or are projected to
be made; and
(8) The pre-compliance reports due in 2006 and later years must
provide an update of the progress in each of these areas.
(b) Reports under this section may be submitted in conjunction with
reports submitted under Sec. 80.594.
(c) The pre-compliance reporting requirements of this section do
not apply to refineries subject to the provisions of Sec. 80.513.
? 62. A new Sec. 80.604 is added to read as follows:
Sec. 80.604 What are the annual reporting requirements for refiners
and importers of NRLM diesel fuel?
Beginning with the annual compliance period that begins June 1,
2007, or the first period during which credits are generated,
transferred or used, or the first period during which NRLM diesel fuel
or heating oil is produced under a small refiner compliance option
under this subpart, whichever is earlier, any refiner or importer who
produces or imports NRLM diesel fuel must submit annual compliance
reports for each refinery and importer facility that contain the
following information required, and such other information as EPA may
require.
(a) All refiners and importers. (1) The refiner or importer's
company name and the EPA company and facility identification number.
(2) If the refiner is a small refiner, a statement regarding to
which small refiner option it is subject.
(b) Small refiners. (1) For each refinery of small refiners subject
to the provisions of Sec. 80.551(g) and Sec. 80.554(a) for each
compliance period from June 1, 2007 through May 31, 2010, report the
following:
(i) The total volume of diesel fuel produced and designated as NRLM
diesel fuel.
(ii) The volume of diesel fuel produced and designated as NRLM
diesel fuel having a sulfur content less than or equal to the 500 ppm
sulfur standard under Sec. 80.510(a).
(iii) The total volume of diesel fuel produced and designated as
NRLM diesel fuel having a sulfur content greater than the 500 ppm
sulfur standard under Sec. 80.510(a).
(iv) The total volume of heating oil produced.
(v) The baseline under Sec. 80.554(a)(1).
(vi) The total volume of diesel fuel produced and designated as
NRLM diesel fuel that is exempt from the 500 ppm sulfur standard of
Sec. 80.510(a).
(vii) The total volume, if any, of NRLM diesel fuel subject to the
500 ppm sulfur standard Sec. 80.510(a) that had a sulfur content
exceeding 500 ppm.
(2) For each refinery of small refiners subject to the provisions
of Sec. 80.551(g) and Sec. 80.554(b), for each compliance period
between June 1, 2010 and May 31, 2012, report the following:
[[Page 39201]]
(i) The total volume of diesel fuel produced and designated as NR
diesel fuel.
(ii) The total volume of diesel fuel produced and designated as LM
diesel fuel.
(iii) The total volume of diesel fuel produced and designated as NR
diesel fuel subject to the 500 ppm sulfur standard under Sec.
80.510(a).
(iv) The total volume of diesel fuel produced and designated as LM
diesel fuel subject to the 500 ppm sulfur standard under Sec.
80.510(a).
(v) The volume of diesel fuel produced and designated as NR diesel
fuel having a sulfur content of 15 ppm or less.
(vi) The baseline under Sec. 80.554(b)(1).
(vii) The total volume of NRLM diesel fuel produced that is
eligible for the sulfur standard under Sec. 80.510(a). (viii) The
total volume, if any, of NRLM diesel fuel subject to the 15 ppm sulfur
standard that had a sulfur content in excess of 15 ppm.
(3) For each refinery of small refiners subject to the provisions
of Sec. 80.551(g) and Sec. 80.554(b), for each compliance period
between June 1, 2012 and May 31, 2014, report the following:
(i) The total volume of diesel fuel produced and designated as NRLM
diesel fuel.
(ii) The total volume diesel fuel produced and designated as NRLM
diesel fuel subject to the 500 ppm sulfur standard under Sec.
80.510(a).
(iii) The total volume of diesel fuel produced and designated as
NRLM diesel fuel having a sulfur content less than or equal to the 15
ppm sulfur standard under Sec. 80.510(c).
(iv) The baseline under Sec. 80.554(b)(1).
(v) The total volume of NRLM diesel fuel produced that is eligible
for the 500 ppm sulfur standard under Sec. 80.510(a).
(vi) The total volume, if any, of NRLM diesel fuel subject to the
15 ppm sulfur standard that had a sulfur content in excess of 15 ppm.
(4) For each refinery of a small refiner that elects to produce
NRLM diesel fuel subject to the 15 ppm sulfur standard of Sec.
80.510(c) beginning June 1, 2006 under Sec. 80.551(g) and Sec.
80.554(d), for each compliance period report the following:
(i) The total volume of diesel fuel produced and designated as NRLM
diesel fuel.
(ii) The total volume of diesel fuel produced and designated as
NRLM diesel fuel having a sulfur content less than or equal to 15 ppm.
(iii) The percentages of NRLM diesel fuel produced and designated
having a sulfur content less than or equal to 15 ppm under Sec.
80.554(d)(1)(i) and (ii).
(iv) The deficit, if any, and the number of credits purchased, if
any, to cover any deficit as provided in Sec. 80.554(d)(3).
(v) A report of the small refiner's progress toward compliance with
the gasoline standards under Sec. Sec. 80.240 and 80.255.
(c) Credit generation and use. Information regarding the
generation, use, transfer and retirement of credits, separately by
refinery and import facility, including the following:
(1) The number of credits at the beginning of the compliance period.
(2) The number of credits generated.
(3) The number of credits used.
(4) If any credits were obtained from or transferred to other
refineries or importers, for each other refinery or importer, the name,
address, the EPA company identification number, and the number of
credits obtained from or transferred to the other party.
(5) The number of credits retired.
(6) The credit balance at the beginning and end of the compliance
period.
(d) Batch reports. For each batch of NRLM diesel fuel and heating
oil (if applicable) produced or imported and delivered during the
compliance periods under paragraph (b) of this section, include the
following:
(1) The batch volume.
(2) The batch number assigned using the batch numbering conventions
under Sec. 80.65(d)(3) and the appropriate designation under Sec.
80.598.
(3) The date of production or import.
(4) For each batch provide the information specified in paragraph
(a)(1) of this section.
(5) The sulfur content and cetane and aromatics content of the fuel.
(6) Whether the batch was dyed with visible evidence of dye solvent
red 164 before leaving the refinery or import facility or was undyed.
(7) Whether the batch was marked with marker solvent yellow 124
before leaving the refinery or import facility or was unmarked.
(e) Additional reporting requirements for importers. Importers of
NRLM diesel fuel are subject to the following additional requirements:
(1) The reporting requirements under Sec. 80.620, if applicable.
(2) Importers must exclude certified DFR-Diesel from calculations
under this section.
(f) Report submission. Any report required by this section must be--
(1) On forms and following procedures specified by the
Administrator of EPA;
(2) Signed and certified as meeting all the applicable requirements
of this subpart by the owner or a responsible corporate officer of the
refiner or importer; and
(3) Except for small refiners subject to Sec. 80.554(d), submitted
to EPA no later than August 31 each year for the prior annual
compliance period. Small refiners subject to the provisions of Sec.
80.554(d), reports must be submitted August 31 for the previous
reporting period.
(4) With the exception of reports required under paragraph (b)(3)
of this section, no reports will be required under this section after
August 31, 2014.
? 63. A center heading is added after Sec. 80.604 to read as follows:
Exemptions
? 64. A new Sec. 80.606 is added to read as follows:
Sec. 80.606 What national security exemption applies to distillate fuel?
(a) The motor vehicle diesel fuel standards of Sec. 80.520(a)(1),
(a)(2), and (c) and the nonroad, locomotive or marine diesel fuel
standards of Sec. 80.510(a), (b), and (c) do not apply to distillate
fuel that is produced, imported, sold, offered for sale, supplied,
offered for supply, stored, dispensed, or transported for use in--
(1) Tactical military motor vehicles or tactical military nonroad
engines, vehicles or equipment, including locomotive and marine, having
an EPA national security exemption from the motor vehicle emissions
standards under 40 CFR 85.1708, or from the nonroad engine emission
standards under 40 CFR part 89, 40 CFR part 92, 40 CFR part 94, or 40
CFR part 1068; and
(2) Tactical military motor vehicles or tactical military nonroad
engines, vehicles or equipment, including locomotive and marine, that
are not subject to a national security exemption from vehicle or engine
emissions standards as described in paragraph (a)(1) of this section
but, for national security purposes (for purposes of readiness for
deployment oversees), need to be fueled on the same fuel as the
vehicles, engines, or equipment for which EPA has granted such a
national security exemption.
(b) The exempt fuel must meet the following conditions:
(1) It must be accompanied by product transfer documents as
required under Sec. 80.590;
(2) It must be segregated from non-exempt MVNRLM diesel fuel at all
points in the distribution system;
(3) It must be dispensed from a fuel pump stand, fueling truck or
tank that is labeled with the appropriate designation of the fuel, such
as ``JP-5'' or ``JP-8''; and
[[Page 39202]]
(4) It may not be used in any motor vehicles or nonroad engines,
equipment or vehicles, including locomotive and marine, other than the
vehicles, engines, and equipment referred to in paragraph (a) of this
section.
? 65. A new Sec. 80.607 is added to read as follows:
Sec. 80.607 What are the requirements for obtaining an exemption for
diesel fuel used for research, development or testing purposes?
(a) Written request for a research and development exemption. Any
person may receive an exemption from the provisions of this subpart for
diesel fuel used for research, development, or testing purposes by
submitting the information listed in paragraph (c) of this section to:
Director, Transportation and Regional Programs Division (6406J),
U.S. Environmental Protection Agency, 1200 Pennsylvania Avenue, NW.,
Washington, DC 20460 (postal mail); or
Director, Transportation and Regional Programs Division, U.S.
Environmental Protection Agency, 1310 L Street, NW., 6th floor,
Washington, DC 20005 (express mail/courier); and
Director, Air Enforcement Division (2242A), U.S. Environmental
Protection Agency, Ariel Rios Building, 1200 Pennsylvania Avenue,
NW., Washington, DC 20460.
(b) Criteria for a research and development exemption. For a
research and development exemption to be granted, the person requesting
an exemption must--
(1) Demonstrate a purpose that constitutes an appropriate basis for
exemption;
(2) Demonstrate that an exemption is necessary;
(3) Design a research and development program to be reasonable in
scope; and
(4) Exercise a degree of control consistent with the purpose of the
program and EPA's monitoring requirements.
(c) Information required to be submitted. To demonstrate each of
the elements in paragraphs (b)(1) through (4) of this section, the
person requesting an exemption must include the following information
in the written request required under paragraph (a) of this section:
(1) A concise statement of the purpose of the program demonstrating
that the program has an appropriate research and development purpose.
(2) An explanation of why the stated purpose of the program cannot
be achieved in a practicable manner without performing one or more of
the prohibited acts under this subpart.
(3) To demonstrate the reasonableness of the scope of the program:
(i) An estimate of the program's duration in time and, if
appropriate, mileage;
(ii) An estimate of the maximum number of vehicles or engines
involved in the program;
(iii) The manner in which the information on vehicles and engines
used in the program will be recorded and made available to the
Administrator upon request; and
(iv) The quantity of diesel fuel which does not comply with the
requirements of Sec. Sec. 80.520 and 80.521 for motor vehicle diesel
fuel or Sec. 80.510 for NRLM diesel fuel.
(4) With regard to control, a demonstration that the program
affords EPA a monitoring capability, including the following:
(i) The site(s) of the program (including facility name, street
address, city, county, state, and zip code);
(ii) The manner in which information on vehicles and engines used
in the program will be recorded and made available to the Administrator
upon request;
(iii) The manner in which information on the diesel fuel used in
the program (including quantity, fuel properties, name, address,
telephone number and contact person of the supplier, and the date
received from the supplier), will be recorded and made available to the
Administrator upon request;
(iv) The manner in which the party will ensure that the research
and development fuel will be segregated from motor vehicle diesel fuel
or NRLM diesel fuel, as applicable, and how fuel pumps will be labeled
to ensure proper use of the research and development diesel fuel;
(v) The name, address, telephone number and title of the person(s)
in the organization requesting an exemption from whom further
information on the application may be obtained; and
(vi) The name, address, telephone number and title of the person(s)
in the organization requesting an exemption who is responsible for
recording and making available the information specified in this
paragraph (c), and the location where such information will be maintained.
(d) Additional requirements. (1) The product transfer documents
associated with research and development motor vehicle diesel fuel must
comply with requirements of Sec. 80.590(b)(3).
(2) The research and development diesel fuel must be designated by
the refiner or supplier, as applicable, as research and development
diesel fuel.
(3) The research and development diesel fuel must be kept
segregated from non-exempt MVNRLM diesel fuel at all points in the
distribution system.
(4) The research and development diesel fuel must not be sold,
distributed, offered for sale or distribution, dispensed, supplied,
offered for supply, transported to or from, or stored by a diesel fuel
retail outlet, or by a wholesale purchaser-consumer facility, unless
the wholesale purchaser-consumer facility is associated with the
research and development program that uses the diesel fuel.
(5) At the completion of the program, any emission control systems
or elements of design which are damaged or rendered inoperative shall
be replaced on vehicles remaining in service, or the responsible person
will be liable for a violation of the Clean Air Act section 203(a)(3)
(42 U.S.C. 7522 (a)(3)) unless sufficient evidence is supplied that the
emission controls or elements of design were not damaged.
(e) Mechanism for granting of an exemption. A request for a
research and development exemption will be deemed approved by the
earlier of 60 days from the date on which EPA receives the request for
exemption, (provided that EPA has not notified the applicant of
potential disapproval by that time), or the date on which the applicant
receives a written approval letter from EPA.
(1) The volume of diesel fuel subject to the approval shall not
exceed the estimated amount under paragraph (c)(3)(iv) of this section,
unless EPA grants a greater amount in writing.
(2) Any exemption granted under this section will expire at the
completion of the test program or three years from the date of
approval, whichever occurs first, and may only be extended upon re-
application consistent will all requirements of this section.
(3) The passage of 60 days will not signify the acceptance by EPA
of the validity of the information in the request for an exemption. EPA
may elect at any time to review the information contained in the
request, and where appropriate may notify the responsible person of
disapproval of the exemption.
(4) In granting an exemption the Administrator may include terms
and conditions, including replacement of emission control devices or
elements of design, that the Administrator determines are necessary for
monitoring the exemption and for assuring that the purposes of this
subpart are met.
(5) Any violation of a term or condition of the exemption, or of
any requirement of this section, will cause the exemption to be void ab
initio.
[[Page 39203]]
(6) If any information required under paragraph (c) of this section
should change after approval of the exemption, the responsible person
must notify EPA in writing immediately. Failure to do so may result in
disapproval of the exemption or may make it void ab initio, and may
make the party liable for a violation of this subpart.
(f) Effects of exemption. Motor vehicle diesel fuel or NRLM diesel
fuel that is subject to a research and development exemption under this
section is exempt from other provisions of this subpart provided that
the fuel is used in a manner that complies with the purpose of the
program under paragraph (c) of this section and the requirements of
this section.
(g) Notification of completion. The party shall notify EPA in
writing within 30 days after completion of the research and development
program.
? 66. A new Sec. 80.608 is added to read as follows:
Sec. 80.608 What requirements apply to diesel fuel for use in the
Territories?
The sulfur standards of Sec. 80.520(a)(1) and (c) related to motor
vehicle diesel fuel, and of Sec. 80.510(a), (b), and (c) related to
NRLM diesel fuel, do not apply to diesel fuel that is produced,
imported, sold, offered for sale, supplied, offered for supply, stored,
dispensed, or transported for use in the Territories of Guam, American
Samoa or the Commonwealth of the Northern Mariana Islands, provided
that such diesel fuel is--
(a) Designated by the refiner or importer as high sulfur diesel
fuel only for use in Guam, American Samoa, or the Commonwealth of the
Northern Mariana Islands;
(b) Used only in Guam, American Samoa, or the Commonwealth of the
Northern Mariana Islands;
(c) Accompanied by documentation that complies with the product
transfer document requirements of Sec. 80.590(b)(1); and
(d) Segregated from non-exempt MVNRLM diesel fuel at all points in
the distribution system from the point the diesel fuel is designated as
exempt fuel only for use in Guam, American Samoa, or the Commonwealth
of the Northern Mariana Islands, while the exempt fuel is in the United
States but outside these Territories.
? 67. Section 80.610 is revised to read as follows:
Sec. 80.610 What acts are prohibited under the diesel fuel sulfur
program?
No person shall--
(a) Standard, dye, marker or product violation. (1) Produce,
import, sell, offer for sale, dispense, supply, offer for supply, store
or transport motor vehicle diesel fuel, NRLM diesel fuel, or heating
oil that does not comply with the applicable standards, dye, marking or
any other product requirements under this subpart I and 40 CFR part 69.
(2) Beginning June 1, 2007, produce, import, sell, offer for sale,
dispense, supply, offer for supply, store or transport any diesel fuel
for use in motor vehicle or nonroad engines that contains greater than
0.10 milligrams per liter of solvent yellow 124, except for 500 ppm
sulfur diesel fuel produced or imported from June 1, 2010 through
September 30, 2012 for use only in locomotive or marine diesel engines
that is marked under the provisions of Sec. 80.510(e).
(3) Beginning June 1, 2007, produce, import, sell, offer for sale,
dispense, supply, offer for supply, store or transport heating oil for
use in any nonroad diesel engine, including any locomotive or marine
diesel engine.
(b) Designation and volume balance violation. Produce, import,
sell, offer for sale, dispense, supply, offer for supply, store or
transport motor vehicle diesel, NRLM diesel fuel, heating oil or other
distillate that does not comply with the applicable designation or
volume balance requirements under Sec. Sec. 80.598 and 80.599.
(c) Additive violation. (1) Produce, import, sell, offer for sale,
dispense, supply, offer for supply, store or transport any motor
vehicle diesel fuel additive or NRLM diesel fuel additive for use at a
downstream location that does not comply with the applicable
requirements of Sec. 80.521.
(2) Blend or permit the blending into motor vehicle diesel fuel or
NRLM diesel fuel at a downstream location, or use, or permit the use,
in motor vehicle diesel fuel or NRLM diesel fuel, of any additive that
does not comply with the applicable requirements of Sec. 80.521.
(d) Used motor oil violation. Introduce into the fuel system of a
model year 2007 or later diesel motor vehicle or model year 2011 or
later nonroad diesel engine (except for locomotive or marine engines)
or other nonroad diesel engine certified for the use of 15 ppm sulfur
content fuel, or permit the introduction into the fuel system of such
vehicle or nonroad engine of used motor oil, or used motor oil blended
with diesel fuel, that does not comply with the requirements of Sec.
80.522.
(e) Improper fuel usage violation. (1) Introduce, or permit the
introduction of, fuel into model year 2007 or later diesel motor
vehicles, and beginning December 1, 2010 into any diesel motor vehicle,
that does not comply with the standards and dye requirements of Sec.
80.520(a) and (b);
(2) Introduce, or permit the introduction of, fuel into any nonroad
diesel engine (including any locomotive or marine diesel engine) that
does not comply with the applicable standards, dye and marking
requirements of Sec. 80.510(a), (d), and (e) and Sec. 80.520(b)
beginning on the following dates:
(i) This prohibition begins December 1, 2007 in the areas specified
in Sec. 80.510(g)(1) and (g)(2), except as specified in paragraph
(e)(2)(ii) of this section.
(ii) This prohibition begins December 1, 2010 in the area specified
in Sec. 80.510(g)(2) for NRLM diesel fuel that is produced in
accordance with a compliance plan approved under Sec. 80.554.
(iii) This prohibition begins December 1, 2010 in all other areas.
(3) Introduce, or permit the introduction of, fuel into any nonroad
diesel engine (other than locomotive and marine diesel engines) that
does not comply with the applicable standards, dye and marking
requirements of Sec. 80.510(b) and (e) beginning on the following dates:
(i) This prohibition begins December 1, 2010 in the areas specified
in Sec. 80.510(g)(1) and (g)(2), except as specified paragraph
(e)(3)(ii) of this section.
(ii) This prohibition begins December 1, 2014 in the area specified
in Sec. 80.510(g)(2) for NRLM diesel fuel that is produced in
accordance with a compliance plan approved under Sec. 80.554.
(iii) This prohibition begins beginning December 1, 2014 in all
other areas.
(4) Introduce, or permit the introduction of, fuel into any
locomotive and marine diesel engine which does not comply with the
applicable standards, dye and marking requirements of Sec. 80.510(c)
and Sec. 80.510(f) in the following areas beginning on the following
dates:
(i) This prohibition begins December 1, 2012 in the areas specified
in Sec. 80.510(g)(1) and (g)(2), except as specified in paragraph
(e)(4)(ii) of this section.
(ii) This prohibition does not apply in the area specified in Sec.
80.510(g)(2) for NRLM diesel fuel that is produced in accordance with a
compliance plan approved under Sec. 80.554.
(iii) This prohibition does not apply in any other areas.
(5) Introduce, or permit the introduction of, fuel into any model
year 2011 or later nonroad diesel engine certified for use on 15 ppm
sulfur
[[Page 39204]]
content fuel, diesel fuel which does not comply with the applicable
standards, dye and marking requirements of Sec. 80.510(b) through (f).
(f) Cause another party to violate. Cause another person to commit
an act in violation of paragraphs (a) through (e) of this section.
(g) Cause violating fuel or additive to be in the distribution
system. Cause motor vehicle diesel fuel, or NRLM diesel fuel, to be in
the diesel fuel distribution system which does not comply with the
applicable standard, dye or marker requirements or the product
segregation requirements of this Subpart I, or cause any diesel fuel
additive to be in the diesel fuel additive distribution system which
does not comply with the applicable sulfur standards under Sec. 80.521.
? 68. Section 80.611 is revised to read as follows:
Sec. 80.611 What evidence may be used to determine compliance with
the prohibitions and requirements of this subpart and liability for
violations of this subpart?
(a) Compliance with sulfur, cetane, and aromatics standards, dye
and marker requirements. Compliance with the standards, dye, and marker
requirements in Sec. Sec. 80.510, 80.511, 80.520, and 80.521 shall be
determined based on the level of the applicable component or parameter,
using the sampling methodologies specified in Sec. 80.330(b), as
applicable, and an approved testing methodology under the provisions of
Sec. Sec. 80.580 through 80.586 for sulfur; Sec. 80.2(w) for cetane
index; Sec. 80.2(z) for aromatic content; and Sec. 80.582 for fuel
marker. Any evidence or information, including the exclusive use of
such evidence or information, may be used to establish the level of the
applicable component or parameter in the diesel fuel or additive, or
motor oil to be used in diesel fuel, if the evidence or information is
relevant to whether that level would have been in compliance with the
standard if the regulatory sampling and testing methodology had been
correctly performed. Such evidence may be obtained from any source or
location and may include, but is not limited to, test results using
methods other than the compliance methods in this paragraph (a),
business records, and commercial documents.
(b) Compliance with other requirements. Determination of compliance
with the requirements and prohibitions of this subpart other than the
standards described in paragraph (a) of this section and in Sec. Sec.
80.510, 80.511, 80.520, and 80.521, and determination of liability for
any violation of this subpart, may be based on information obtained
from any source or location. Such information may include, but is not
limited to, business records and commercial documents.
? 69. Section 80.612 is amended by revising paragraph (a) to read as
follows:
Sec. 80.612 Who is liable for violations of this subpart?
(a) Persons liable for violations of prohibited acts. (1) Standard,
dye, marker, additives, used motor oil, heating oil, fuel introduction,
and other product requirement violations. (i) Any refiner, importer,
distributor, reseller, carrier, retailer, wholesale purchaser-consumer
who owned, leased, operated, controlled or supervised a facility where
a violation of any provision of Sec. 80.610(a) through (e) occurred,
or any other person who violates any provision of Sec. 80.610(a)
through (e), is deemed liable for the applicable violation, except that
distributors who receive diesel fuel or distillate from the point where
it is taxed, dyed or marked, and retailers and wholesale purchaser-
consumers are not deemed liable for any violation of Sec. 80.610(b).
(ii) Any person who causes another person to violate Sec.
80.610(a) through (e) is liable for a violation of Sec. 80.610(f).
(iii) Any refiner, importer, distributor, reseller, carrier,
retailer, or wholesale purchaser-consumer who produced, imported, sold,
offered for sale, dispensed, supplied, offered to supply, stored,
transported, or caused the transportation or storage of, diesel fuel or
distillate that violates Sec. 80.610(a), is deemed in violation of
Sec. 80.610(f).
(iv) Any person who produced, imported, sold, offered for sale,
dispensed, supplied, offered to supply, stored, transported, or caused
the transportation or storage of a diesel fuel additive which is used
in motor vehicle diesel fuel or NRLM diesel fuel that is found to
violate Sec. 80.610(a), is deemed in violation of Sec. 80.610(f).
(2) Cause violating diesel fuel or additive to be in the
distribution system. Any refiner, importer, distributor, reseller,
carrier, retailer, or wholesale purchaser-consumer or any other person
who owned, leased, operated, controlled or supervised a facility from
which distillate fuel or additive was released into the distribution
system which does not comply with the applicable standards, marking or
dye requirements of this Subpart I is deemed in violation of Sec.
80.610(g).
(3) Branded refiner/importer liability. Any refiner or importer
whose corporate, trade, or brand name, or whose marketing subsidiary's
corporate, trade, or brand name appeared at a facility where a
violation of Sec. 80.610(a) or (b) occurred, is deemed in violation of
Sec. 80.610(a) or (b), as applicable.
(4) Carrier causation. In order for a distillate fuel or diesel
fuel additive carrier to be liable under paragraph (a)(1)(ii),
(a)(1)(iii), or (a)(1)(iv) of this section, as applicable, EPA must
demonstrate, by reasonably specific showing by direct or circumstantial
evidence, that the carrier caused the violation.
(5) Parent corporation. Any parent corporation is liable for any
violations of this subpart that are committed by any subsidiary.
(6) Joint venture. Each partner to a joint venture is jointly and
severally liable for any violation of this subpart that occurs at the
joint venture facility or is committed by the joint venture operation.
* * * * *
? 70. Section 80.613 is amended by revising the section heading and
paragraphs (a) and (d) to read as follows:
Sec. 80.613 What defenses apply to persons deemed liable for a
violation of a prohibited act under this subpart?
(a) Presumptive liability defenses. (1) Any person deemed liable
for a violation of a prohibition under Sec. 80.612(a)(1)(i),
(a)(1)(iii), (a)(2), or (a)(3), will not be deemed in violation if the
person demonstrates the following:
(i) The violation was not caused by the person or the person's
employee or agent;
(ii) Product transfer documents account for fuel or additive found
to be in violation and indicate that the violating product was in
compliance with the applicable requirements when it was under the
person's control;
(iii) The person conducted a quality assurance sampling and testing
program, as described in paragraph (d) of this section, except for
those persons subject to the provisions of paragraph (a)(1)(iv),
(a)(1)(v), or (a)(1)(vi) of this section or Sec. 80.614. A carrier may
rely on the quality assurance program carried out by another party,
including the party who owns the diesel fuel in question, provided that
the quality assurance program is carried out properly. Retailers,
wholesale purchaser-consumers, and ultimate consumers of diesel fuel
are not required to conduct quality assurance programs;
(iv) For refiners and importers of diesel fuel subject to the 15
ppm sulfur standard under Sec. 80.510(b) or (c), or Sec.
80.520(a)(1), or the 500 ppm sulfur standard under Sec. 80.510(a) or
80.520(c), test results that--
[[Page 39205]]
(A) Were conducted according to an appropriate test methodology
approved or designated under Sec. Sec. 80.580 through 80.586, 80.2(w),
or 80.2(z), as appropriate; and
(B) Establish that, when it left the party's control, the fuel did
not violate the sulfur, cetane or aromatics standard, or the dye or
marking provisions of Sec. Sec. 80.510 or 80.511, as applicable;
(v) For any truck loading terminal or any other person who delivers
heating oil for delivery to the ultimate consumer and is subject to the
requirement to mark heating oil or LM diesel fuel under Sec. 80.510(d)
through (f), data which demonstrates that when it left the truck
loading terminal or other facility, the concentration of marker solvent
yellow 124 was equal to or greater than six milligrams per liter. In
lieu of testing for marker solvent yellow 124 concentration, evidence
may be presented of an oversight program, including records of marker
inventory, purchase and additization, and records of periodic
inspection and calibration of additization equipment that ensures that
marker is added to heating oil or LM diesel fuel, as applicable, under
Sec. 80.510(d) through (f) in the required concentration;
(vi) Except as provided in Sec. 80.614, for any person who, at a
downstream location, blends a diesel fuel additive subject to the
requirements of Sec. 80.521(b) into motor vehicle diesel fuel or NRLM
diesel fuel subject to the 15 ppm sulfur standard under Sec. 80.520(a)
or Sec. 80.510(b) or (c), except a person who blends additives into
fuel tanker trucks at a truck loading rack subject to the provisions of
paragraph (d)(2) of this section, test results which are conducted
subsequent to the blending of the additive into the fuel, and which
comply with the requirements of paragraphs (a)(1)(iv)(A) and (B) of
this section; and
(vii) Any person deemed liable for a designation or volume balance
provisions violation under Sec. 80.610(b) and 80.612(a) will not be
deemed in violation if the person demonstrates, through product
transfer documents, records, reports and other evidence that the diesel
fuel or distillate was properly designated and volume balance
requirements were met.
(2) Any person deemed liable for a violation under Sec.
80.612(a)(1)(iv), in regard to a diesel fuel additive subject to the
requirements of Sec. 80.521(a), will not be deemed in violation if the
person demonstrates that--
(i) Product transfer document(s) account for the additive in the
fuel found to be in violation, which comply with the requirements under
Sec. 80.591(a), and indicate that the additive was in compliance with
the applicable requirements while it was under the party's control; and
(ii) For the additive's manufacturer or importer, test results
which accurately establish that, when it left the party's control, the
additive in the diesel fuel determined to be in violation did not have
a sulfur content greater than or equal to 15 ppm.
(A) Analysis of the additive sulfur content pursuant to this
paragraph (a)(2) may be conducted at the time the batch was
manufactured or imported, or on a sample of that batch which the
manufacturer or importer retains for such purpose for a minimum of two
years from the date the batch was manufactured or imported.
(B) After two years from the date the additive batch was
manufactured or imported, the additive manufacturer or importer is no
longer required to retain samples for the purpose of complying with the
testing requirements of this paragraph (a)(2).
(C) The analysis of the sulfur content of the additive must be
conducted pursuant to the requirements of Sec. 80.580.
(3) Any person who is deemed liable for a violation under Sec.
80.612(a)(1)(iv) with regard to a diesel fuel additive subject to the
requirements of Sec. 80.521(b), will not be deemed in violation if the
person demonstrates that--
(i) The violation was not caused by the party or the party's
employee or agent;
(ii) Product transfer document(s) which comply with the additive
information requirements under Sec. 80.591(b), account for the
additive in the fuel found to be in violation, and indicate that the
additive was in compliance with the applicable requirements while it
was under the party's control; and
(iii) For the additive's manufacturer or importer, test results
which accurately establish that, when it left the party's control, the
additive in the diesel fuel determined to be in violation was in
conformity with the information on the additive product transfer
document pursuant to the requirements of Sec. 80.591(b). The testing
procedures applicable under paragraph (a)(2) of this section, also
apply under this paragraph (a)(3).
* * * * *
(d) Quality assurance and testing program. To demonstrate an
acceptable quality assurance program under paragraph (a)(1)(iii) of
this section, a person must present evidence of the following:
(1) A periodic sampling and testing program to ensure the diesel
fuel or additive the person sold, dispensed, supplied, stored, or
transported, meets the applicable standards and requirements, including
the requirements relating to the presence of marker solvent yellow 124.
(2) For those parties who, at a downstream location, blend diesel
fuel additives subject to the requirements of Sec. 80.521(b) into fuel
trucks at a truck loading rack, the periodic sampling and testing
program required under this paragraph (d) must ensure, by taking into
account the greater risk of noncompliance created through use of a high
sulfur additive, that the diesel fuel into which the additive was
blended meets the applicable standards subsequent to the blending.
(3) On each occasion when diesel fuel or additive is found not in
compliance with the applicable standard:
(i) The person immediately ceases selling, offering for sale,
dispensing, supplying, offering for supply, storing or transporting the
non-complying product.
(ii) The person promptly remedies the violation and the factors
that caused the violation (for example, by removing the non-complying
product from the distribution system until the applicable standard is
achieved and taking steps to prevent future violations of a similar
nature from occurring).
(4) For any carrier who transports diesel fuel or additive in a
tank truck, the quality assurance program required under this paragraph
(d) need not include its own periodic sampling and testing of the
diesel fuel or additive in the tank truck, but in lieu of such tank
truck sampling and testing, the carrier shall demonstrate evidence of
an oversight program for monitoring compliance with the requirements of
this subpart relating to the transport or storage of such product by
tank truck, such as appropriate guidance to drivers regarding
compliance with the applicable sulfur standard, product segregation and
product transfer document requirements, and the periodic review of
records received in the ordinary course of business concerning diesel
fuel or additive quality and delivery.
? 71. Section 80.614 is revised to read as follows:
Sec. 80.614 What are the alternative defense requirements in lieu of
Sec. 80.613(a)(1)(vi) for static dissipater additives exceeding the 15
ppm sulfur standard but that contribute less than 0.05 ppm sulfur when
added to MVNRLM diesel fuel?
Any person who blends a MVNRLM diesel fuel additive package into
[[Page 39206]]
MVNRLM diesel fuel subject to the 15 ppm sulfur standards of Sec.
80.510(b) or (c) or Sec. 80.520(a) which contains a static dissipater
additive that has a sulfur content greater than 15 ppm but whose
contribution to the sulfur content of the MVNRLM diesel fuel is less
than 0.05 ppm at its maximum recommended concentration, and which
contains no other additives with a sulfur content greater than 15 ppm
must establish all the following in order to use this section as an
alternative to the defense element under Sec. 80.613(a)(1)(vi):
(a)(1) The blender of the static dissipater additive package has a
sulfur content test result for the MVNRLM diesel fuel prior to blending
of the additive that indicates that the additive package, when added,
will not cause the MVNRLM diesel fuel sulfur content to exceed 15 ppm
sulfur.
(2) In cases where the storage tank that contains MVNRLM diesel
fuel prior to additization contains multiple fuel batches, the blender
of the static dissipater additive package must have sulfur test results
on each batch of MVNRLM diesel fuel that was added to the storage tank
during the current and previous VAR periods, which indicates that the
additive package, when added to the component MVNRLM diesel fuel batch
in the storage tank with the highest sulfur level would not cause that
component batch to exceed 15 ppm sulfur.
(b) The volumetric additive reconciliation (VAR) standard is
attained as determined under the provisions of this section. The VAR
reconciliation standard is attained when the actual concentration of a
static dissipater additive package used per the VAR formula record
under paragraph (f) of this section is less than the concentration that
would have caused any batch of MVNRLM diesel fuel to exceed a sulfur
content of 15 ppm given the maximum sulfur test result on any MVNRLM
diesel fuel batch described in paragraph (a) of this section that is
additized with the static dissipater additive package during the VAR
period.
(c) The product transfer document complies with the applicable
sulfur information requirements of Sec. 80.591.
(d) If more than one static dissipater additive package is used
during a VAR period, then a separate VAR formula record must be created
for MVNRLM diesel fuel additized for each of the static dissipater
additive packages used. In such cases, the amount of the each static
dissipater additive package used must be accurately and separately
measured, either through the use of a separate storage tank, a separate
meter, or some other measurement system that is able to accurately
distinguish its use.
(e) Recorded volumes of MVNRLM diesel fuel and static dissipater
additive package must be expressed to the nearest gallon (or smaller
units), except that static dissipater additive package volumes of five
gallons or less must be expressed to the nearest tenth of a gallon (or
smaller units). However, if the blender's equipment cannot accurately
measure to the nearest tenth of a gallon, then such volumes must be
rounded upward to the next higher gallon for purposes of determining
compliance with this section.
(f) Each VAR formula record must also contain the following
information:
(1) Automated blending facilities. In the case of an automated
static dissipater additive package blending facility, for each VAR
period, for each static dissipater additive package storage system, and
each static dissipater additive package in that storage system, the
following must be recorded:
(i)(A) The manufacturer and commercial identifying name of the
static dissipater additive package being reconciled, the maximum
recommended treatment level, the potential contribution to the sulfur
content of the finished fuel that might result when the additive
package is used at its maximum recommended treatment level, the
intended treatment level, and the contribution to the sulfur content of
the finished fuel that would result when the additive package is used
at its intended treatment level. The intended treatment level is the
treatment level that the additive injection equipment is set to.
(B) The maximum recommended treatment level and the intended
treatment level must be expressed in terms of gallons of static
dissipater additive package per thousand gallons of MVNRLM diesel fuel,
and expressed to four significant figures. If the static dissipater
additive package storage system which is the subject of the VAR formula
record is a proprietary system under the control of a customer, this
fact must be indicated on the record.
(ii) The total volume of static dissipater additive package blended
into MVNRLM diesel fuel, in accordance with one of the following
methods, as applicable.
(A) For a facility which uses in-line meters to measure static
dissipater additive package usage, the total volume of static
dissipater additive package measured, together with supporting data
which includes one of the following: the beginning and ending meter
readings for each meter being measured, the metered batch volume
measurements for each meter being measured, or other comparable metered
measurements. The supporting data may be supplied on the VAR formula
record or in the form of computer printouts or other comparable VAR
supporting documentation.
(B) For a facility which uses a gauge to measure the inventory of
the static dissipater additive package storage tank, the total volume
of static dissipater additive package shall be calculated from the
following equation:
Static dissipater additive package Volume = (A)-(B)+(C) - (D)
Where:
A = Initial static dissipater additive package inventory of the tank
B = Final static dissipater additive package inventory of the tank
C = Sum of any additions to static dissipater additive package
inventory
D = Sum of any withdrawals from static dissipater additive package
inventory for purposes other than the additization of MVNRLM diesel fuel.
(C) The value of each variable in the equation in paragraph
(f)(1)(ii)(B) of this section must be separately recorded on the VAR
formula record. In addition, a list of each static dissipater additive
package addition included in variable C and a list of each static
dissipater additive package withdrawal included in variable D must be
provided, either on the formula record or as VAR supporting
documentation.
(iii) The total volume of MVNRLM diesel fuel to which static
dissipater additive package has been added, together with supporting
data which includes one of the following: the beginning and ending
meter measurements for each meter being measured, the metered batch
volume measurements for each meter being measured, or other comparable
metered measurements. The supporting data may be supplied on the VAR
formula record or in the form of computer printouts or other comparable
VAR supporting documentation.
(iv) The actual static dissipater additive package concentration,
calculated as the total volume of static dissipater additive package
added (pursuant to paragraph (f)(1)(ii) of this section), divided by
the total volume of MVNRLM diesel fuel (pursuant to paragraph
(f)(1)(iii) of this section). The concentration must be calculated and
recorded to 4 significant figures.
(v) A list of each static dissipater additive package concentration
rate set for the static dissipater additive package that is the subject
of the VAR record, together with the date and description of each
adjustment to any initially set concentration. The concentration
adjustment information may be
[[Continued on page 39207]]
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