[Federal Register Volume 59, Number 32 (Wednesday, February 16, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-20]


[[Page Unknown]]

[Federal Register: February 16, 1994]


_______________________________________________________________________

Part II





Environmental Protection Agency





_______________________________________________________________________



40 CFR Part 80



Regulation of Fuels and Fuel Additives; Standards for Reformulated and 
Conventional Gasoline; Final Rule
ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 80

[AMS-FRL-4817-8]

 

Regulation of Fuels and Fuel Additives: Standards for 
Reformulated and Conventional Gasoline

AGENCY: Environmental Protection Agency.

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: Through the amended Clean Air Act of 1990, Congress mandated 
that EPA promulgate new regulations requiring that gasoline sold in 
certain areas be reformulated to reduce vehicle emissions of toxic and 
ozone-forming compounds. This document finalizes the rules for the 
certification and enforcement of reformulated gasoline and provisions 
for unreformulated or conventional gasoline.

DATES: The regulations for the reformulated gasoline program are 
effective on March 18, 1994. The incorporation by reference of certain 
publications listed in the regulations is approved by the Director of 
the Federal Register as of March 18, 1994. The information collection 
requirements contained in 40 CFR part 80 have not been approved by the 
Office of Management and Budget (OMB) and are not effective until OMB 
has approved them. EPA will publish a document in the Federal Register 
following OMB approval of the information collection requirements.
    Retail sale of reformulated gasoline will begin on January 1, 1995, 
as will the provisions for the ``simple model'' certification, the 
anti-dumping program for conventional gasoline, and the associated 
enforcement procedures. (For all ensuing sections of this document, the 
program's beginning date of January 1, 1995 refers only to the retail 
sale of reformulated gasoline.) Certification of reformulated gasoline 
by the ``complex model'' and compliance with the Phase II performance 
standards, will begin January 1, 1998 and January 1, 2000, 
respectively.

ADDRESSES: Materials relevant to this FRM are contained in Public 
Dockets A-92-01 and A-92-12, located at room M-1500, Waterside Mall 
(ground floor), U.S. Environmental Protection Agency, 401 M Street SW., 
Washington, DC 20460. The docket may be inspected from 8 a.m. until 12 
noon and from 1:30 p.m. until 3 p.m. Monday through Friday. A 
reasonable fee may be charged by EPA for copying docket materials. 
FOR FURTHER INFORMATION CONTACT:

Paul Machiele (reformulated gasoline requirements), U.S. EPA (RDSD-12), 
Regulation Development and Support Division, 2565 Plymouth Road, Ann 
Arbor, MI 48105, Telephone: (313) 668-4264.
George Lawrence (reformulated gasoline and anti-dumping enforcement 
requirements), U.S. EPA (6406J), Field Operations and Support Division, 
501 3rd Street, Washington, DC 20005, Telephone: (202) 233-9307.

SUPPLEMENTARY INFORMATION: Today's final rule is preceded by four 
previous notices: an initial notice proposing standards for 
reformulated and conventional gasoline (NPRM) published on July 9, 1991 
(56 FR 31176), a supplemental notice (SNPRM) published on April 16, 
1992 (57 FR 13416), an additional NPRM published on February 26, 1993 
(58 FR 11722), and a notice of correction for Phase II standards 
published on April 1, 1993 (58 FR 17175). Insofar as the rules 
finalized today mirror the proposed standards, those previous documents 
may be referred to.
    Today's preamble explains the basis and purpose of the final rule, 
focusing on issues that have been revised since the publication of the 
correction notice for the Phase II performance standards (58 FR 17175). 
Support documents, including the Regulatory Impact Analysis (RIA), are 
available in Public Docket No. A-92-12.
    To Request Copies of This Final Rule Contact: Delores Frank, U.S. 
EPA (RDSD-12), Regulation Development and Support Division, 2565 
Plymouth Road, Ann Arbor, MI 48105, Telephone: (313) 668-4295.
    Copies of the preamble, the Final Regulatory Impact Analysis (RIA), 
the Responses to Comments on Enforcement Provisions (RCEP), the complex 
model, the simple model and the regulations for the reformulated 
gasoline rulemaking are available on the OAQPS Technology Transfer 
Network Bulletin Board System (TTNBBS). The TTNBBS can be accessed with 
a dial-in phone line and a high-speed modem (PH# 919-541-5742). The 
parity of your modem should be set to none, the data bits to 8, and the 
stop bits to 1. Either a 1200, 2400, or 9600 baud modem should be used. 
When first signing on, the user will be required to answer some basic 
informational questions for registration purposes. After completing the 
registration process, proceed through the following series of menus:
    (M) OMS
    (K) Rulemaking and Reporting
    (3) Fuels
    (9) Reformulated gasoline
    A list of ZIP files will be shown, all of which are related to the 
reformulated gasoline rulemaking process. The six documents mentioned 
above will be in the form of a ZIP file and can be identified by the 
following titles: ``PREAMBLE.ZIP'' (preamble); ``RIAFINAL.ZIP'' (RIA); 
``ENFORCE.ZIP'' (RCEP); ``EPAFINAL.ZIP'' (complex model); 
``MODFINAL.ZIP'' (simple model); ``REGFINAL.ZIP'' (regulations). To 
download these files, type the instructions below and transfer 
according to the appropriate software on your computer:

ownload, rotocol, xamine, ew, ist, or  to exit: D filename.zip

    You will be given a list of transfer protocols from which you must 
choose one that matches with the terminal software on your own 
computer. Then go into your own software and tell it to receive the 
file using the same protocol. Programs and instructions for de-
archiving compressed files can be found via ystems Utilities from 
the top menu, under rchivers/de-archivers.

I. Background

    The purpose of the reformulated gasoline regulations is to improve 
air quality by requiring that gasoline be reformulated to reduce motor 
vehicle emissions of toxic and tropospheric ozone-forming compounds, as 
prescribed by section 211(k)(1) of the Clean Air Act (CAA or the Act), 
as amended. This section of the Act mandates that reformulated gasoline 
be sold in the nine largest metropolitan areas with the most severe 
summertime ozone levels and other ozone nonattainment areas that opt 
into the program. It also prohibits conventional gasoline sold in the 
rest of the country from becoming any more polluting than it was in 
1990. This requirement ensures that refiners do not ``dump'' fuel 
components that are restricted in reformulated gasoline and that cause 
environmentally harmful emissions into conventional gasoline.
    Section 211(k)(l) directs EPA to issue regulations that, beginning 
in 1995, ``require the greatest reduction in emissions of ozone-forming 
and toxic air pollutants (``toxics'') achievable through the 
reformulation of conventional gasoline, taking into consideration the 
cost of achieving such emission reductions, any non air-quality and 
other air-quality related health and environmental impacts and energy 
requirements.'' The Act mandates certain requirements for the 
reformulated gasoline program. Section 211(k)(3) specifies that the 
minimum requirement for reductions of volatile organic compounds (VOC) 
and toxics for 1995 through 1999, or Phase I of the reformulated 
gasoline program, must require the more stringent of either a formula 
fuel or an emission reductions performance standard, measured on a mass 
basis, equal to 15 percent of baseline emissions. Baseline emissions 
are the emissions of 1990 model year vehicles operated on a specified 
baseline gasoline. CAA compositional specifications for reformulated 
gasoline include a 2.0 weight percent oxygen minimum and a 1.0 volume 
percent benzene maximum.
    For the year 2000 and beyond, the Act specifies that the VOC and 
toxics performance standards must be no less than that of the formula 
fuel or a 25 percent reduction from baseline emissions, whichever is 
more stringent. EPA can adjust this standard upward or downward taking 
into account such factors as feasibility and cost, but in no case can 
it be less than 20 percent. These are known as the Phase II 
reformulated gasoline performance standards. Taken together, sections 
211(k)(1) and 211(k)(3) call for the Agency to set standards that 
achieve the most stringent level of control, taking into account the 
specified factors, but no less stringent than those described by 
section 211(k)(3).
    The reader may refer to the April 16, 1992 SNPRM (57 FR 13416) and 
the February 26, 1993 NPRM (58 FR 11722) described in more detail 
below), the February 1993 Draft Regulatory Impact Analysis (DRIA), the 
Final Regulatory Impact Analysis (RIA), and Public Dockets A-91-02 and 
A-92-12 for a thorough description of the goals and regulatory 
development of the reformulated and anti-dumping programs and 
discussions of a number of associated technical issues.

A. Regulatory Negotiation (Reg Neg)

    Shortly after passage of the Clean Air Act Amendments of 1990, EPA 
entered into a regulatory negotiation with interested parties to 
develop specific proposals for implementing both the reformulated 
gasoline and related anti-dumping programs. These parties included 
representatives of the oil and automobile industries, vehicle owners, 
state air pollution control officials, oxygenate suppliers, gasoline 
retailers, environmental organizations, and citizens' groups. (See the 
1991 NPRM for the members of the negotiating committee and a discussion 
of the process for selecting them.)
    In August 1991 the committee reached consensus on a program outline 
and signed an ``Agreement in Principle'' describing that consensus. EPA 
agreed to propose a two-step approach to reformulated gasoline. The 
first step would take effect in 1995 and utilize a ``simple model'' to 
certify that a gasoline meets applicable emission reduction standards. 
The simple model allows certification based on a fuel's oxygen, 
benzene, heavy metal and aromatics content and Reid Vapor Pressure 
(RVP).
    Under the second step, according to the regulatory negotiation 
agreement, EPA would propose a ``complex model'' to supplant the simple 
model for certifying compliance with these standards. Certification 
under the complex model would take effect 4 years after it is 
promulgated. EPA also agreed to propose the more stringent Phase II 
emission performance standards.

B. July 9, 1991 NPRM (56 FR 31176)

    The first NPRM for the reformulated gasoline program was published 
prior to the conclusion on the regulatory negotiations. Normally, in a 
negotiated rulemaking, such a reg-neg committee meets to develop a 
proposed rule which will be acceptable to all parties. If consensus is 
reached on a proposed rule, it is published as an NPRM. The committee 
members and the entities they represent agree to support the proposal 
and not to seek judicial review of the final rule if it has the same 
substance and effect as the consensus proposal. In this case, EPA 
published an NPRM while the advisory committee was still conducting 
negotiations. The Agency believed that although consensus of the 
members on an acceptable rule was possible, an NPRM was required at 
that time in order to meet the statutory deadline.
    The 1991 NPRM described the provisions of both a program to require 
the sale of gasoline which reduces emissions of toxics and ozone-
forming volatile organic compounds (VOCs) in certain nonattainment 
areas and a program to prohibit the gasoline sold in the rest of the 
country from becoming more polluting. The 1991 notice described the 
outline of the reformulated gasoline program as required by statutory 
provisions and options that the regulatory negotiation committee 
members were considering. Topics included in the 1991 proposal 
consisted of the derivation of the emission standards, fuel 
certification by modeling, opt-in provisions, credits, anti-dumping 
requirements, and enforcement provisions for all aspects of the 
reformulated gasoline program.

C. April 16, 1992 SNPRM (57 FR 13416)

    As noted above, the Agency's SNPRM (57 FR 13416) reflected the 
agreement reached in the regulatory negotiation that had been conducted 
to develop reformulated gasoline regulations under section 211(k). The 
Supplemental Notice of Proposed Rulemaking (SNPRM) described the 
standards and enforcement scheme for both reformulated and conventional 
gasoline. It also included specific proposals for the simple emission 
model to be used in gasoline certification and enforcement.

D. February 26, 1993 NPRM (58 FR 11722)

    In their comments on the SNPRM, the ethanol industry expressed 
concern that the reformulated gasoline rulemaking, as proposed in the 
SNPRM, effectively excluded ethanol from the reformulated gasoline 
market. In an attempt to address their concern, the Agency proposed an 
ethanol incentive program, at the direction of former President Bush, 
intended to promote the use of ethanol (and other renewable oxygenates) 
in reformulated gasoline. The objective of the proposed renewable 
oxygenate program was to enhance the market share for renewable 
oxygenates while, theoretically, maintaining the overall environmental 
benefits of the reformulated gasoline simple model. This would be 
accomplished by offsetting any increase in volatility that may result 
from the inclusion of ethanol with volatility reductions that occur in 
the rest of the RFG pool. This volatility balancing, however would not 
take into account any increase in volatility in-use due to mixing of 
ethanol and non-ethanol gasoline blends (commingling). The renewable 
oxygenate program would not be required in class B areas (the South) 
unless a state requested inclusion in the program. Thus, the NPRM (58 
FR 11722) for reformulated gasoline proposed revisions to the simple 
model, as well as to the associated anti-dumping, and enforcement 
provisions. Also included in the NPRM were the proposed complex model 
for certification of reformulated gasoline and the proposed Phase II 
performance standards. The complex model is now scheduled to take 
effect January 1, 1998. The complex model will provide a method of 
certification based on the fuel characteristics such as oxygen, 
benzene, aromatics, RVP, sulfur, olefins and the percent of fuel 
evaporated at 200 and 300 degrees Fahrenheit (E200 and E300, 
respectively). The NPRM also proposed Phase II standards for 
reformulated gasoline which are to take effect in the year 2000, as 
prescribed by section 211(k)(3) of the Clean Air Act (CAA). The 
proposed VOC performance standard was 20-32 percent for class B and 26-
35 percent for class C. EPA proposed to set the toxic standard at 20 or 
25 percent reduction since additional toxics control was not found to 
be cost effective and, in most cases, these greater toxics reductions 
were expected to occur through fuel reformulation for VOC control. The 
NPRM also included proposed NOx performance standards of 0-16 
percent in classes B and C. The proposed NOx standards greater 
than zero were not required by the CAAA, but were proposed under the 
authority of section 211(c)(1) in conjunction with the Phase II 
reformulated gasoline standards of the Act since additional NOx 
control was deemed beneficial and cost effective in reducing ambient 
ozone levels.

E. Discussion of Major Comments and Issues

    EPA received a number of comments on the first NPRM (56 FR 31176), 
the SNPRM (57 FR 13416), and the latest NPRM (58 FR 11722) for 
reformulated and conventional gasoline. Comments covered a wide range 
of topics including regulatory procedure, certification standards, 
modeling emissions by the simple and complex models, the role of 
ethanol and other oxygenates in reformulated gasoline, vehicle testing, 
the anti-dumping program, Phase II standards, cost-effectiveness, and a 
number of enforcement-related issues. EPA has conducted an analysis of 
the comments received and duly considered the significant issues. 
Summaries of these comments and EPA's responses to them are contained 
in the Final Regulatory Impact Analysis and the Summary and Analysis of 
Comments which has been placed in the docket for this rulemaking 
(Public Docket No. A-92-12). Since the publication of the NPRM, the 
Agency has continued to develop the complex model. The first revisions 
of the complex emissions model since 1993 NPRM publication for 
reformulated gasoline have been provided to the public at a June 2, 
1993 public workshop. EPA developed several complex model options in 
July which was provided to the public. In October of 1993, a draft 
version of the final complex model was released for public inspection 
as well. All the iterations of the complex model since the publication 
of the 1993 NPRM have been available to the public via a public 
electronic bulletin board and in submittals to the EPA Air Docket, 
Docket No. A-92-12.
    All the various components of this rulemaking are being finalized 
in today's notice. The additional time has allowed adequate public 
review of the complex model and its implications for the reformulated 
gasoline Phase II standards.
    The remainder of this preamble is organized into the following 
sections:

II.  Treatment of Ethanol
III.  Simple Model for Reformulated Gasoline Compliance
IV.  Complex Model
V.  Augmenting the Models Through Testing
VI.  Phase II (Post-1999) Reformulated Gasoline Performance 
Standards and NOx Standards for Reformulated Gasoline
VII.  Enforcement
VIII.  Anti-Dumping Requirements for Conventional Gasoline
IX.  Anti-Dumping Compliance and Enforcement Requirements for 
Conventional Gasoline
X.  Provisions for Opt-In by Other Ozone Non-Attainment Areas
XI.  Federal Preemption
XII.  Environmental and Economic Impacts
XIII.  Public Participation
XIV.  Compliance With the Regulatory Flexibility Act
XV.  Statutory Authority
XVI.  Administrative Designation and Regulatory Analysis
XVII.  Compliance With the Paperwork Reduction Act
XVIII.  Notice Regarding Registration of Reformulated Gasolines

II. Treatment of Ethanol

A. Background

    The April 16, 1992 proposal of the Simple Model and Phase I 
standards was designed to be fuel and oxygenate neutral. Ethanol, 
however, when added to gasoline in the amount needed to satisfy the 
oxygen content requirement of the Act raises the Reid vapor pressure 
(RVP) of the resulting blend by about 1 psi, making it more difficult 
for ethanol blends to meet the mass VOC performance standards than 
blends using other oxygenates. For ethanol to be blended with the RFG, 
a blendstock gasoline with an RVP low enough to offset the increase 
resulting from adding ethanol would have to be obtained.
    Ethanol industry representatives commented that obtaining such 
blendstocks would be both difficult and expensive, because ``sub-RVP'' 
blendstocks would be more costly to refine and because blendstock 
production would be controlled by petroleum refiners. Methyl tertiary 
butyl ether (MTBE), an oxygenate which does not boost a fuel's RVP, 
which is derived from methanol gas and the petroleum product 
isobutylene and whose blends can readily be put through petroleum 
pipelines, was thought to be the oxygenate of choice for most refiners. 
Ethanol's representatives theorized that the oil industry would have a 
desire to use MTBE over ethanol and, thus, little incentive to make the 
sub-RVP blendstock necessary for ethanol blending. The ethanol industry 
contended that a reformulated gasoline program which they argued would 
effectively preclude ethanol was contrary to Congress' intent that 
ethanol have a role in the program. They argued that the oxygen content 
requirement of section 211(k)(2) was motivated in large part by a 
desire to expand markets for ethanol. They noted the strong support 
afforded the RFG legislative initiative by members of Congress from 
agricultural states. They also cited statements in the legislative 
history indicating some members' expectation that the RFG program would 
provide an increasing market for ethanol.
    Ethanol representatives contended that the benefits of ethanol use 
justify its inclusion in the RFG program. Specifically, they explained 
that ethanol is currently made in the United States from domestically-
grown grains, primarily corn, and thus represents an important domestic 
and renewable source of energy. They further explained that to the 
extent ethanol is used in place of imported petroleum products, it 
promotes the nation's energy independence and improves its balance of 
trade, and that ethanol use also strengthens the market for corn, 
consequently reducing the need for price supports. Moreover, as a 
biomass-based product, ethanol is potentially a renewable fuel to the 
extent the energy derived exceeds any fossil fuel energy consumed in 
producing the ethanol.
    In view of ethanol's importance to the nation's energy security and 
agricultural economy, ethanol representatives urged that the proposal 
be revised to allow ethanol to effectively participate in the RFG 
market. They suggested several possible revisions. For example, they 
argued that the 1 psi waiver granted to certain ethanol blends by 
section 211(h) of the CAA be applied to ethanol-blended RFG under 
section 211(k). They reasoned that since Congress recognized in the 
provision requiring nationwide reductions in fuel RVP that ethanol 
required such a waiver, ethanol should receive a similar waiver if the 
VOC performance standard for RFG sold in the smoggiest cities were 
defined in terms of a required reduction in RVP.
    If the section 211(h) waiver were not available to RFG ethanol 
blends, the ethanol industry suggested that the VOC reduction 
requirement take into account that specific VOCs from various 
reformulated gasolines differ in their ozone formation potential. While 
ethanol raises a fuel's volatility and thus its VOC emissions, they 
argued that the resulting VOCs are less ozone-forming than those that 
would otherwise occur. They urged that the 15 percent reduction 
requirement should thus be interpreted to require a 15 percent 
reduction in ozone-forming potential, not simply mass of ozone-forming 
VOCs. Ethanol supporters suggested additional ways of encouraging or 
even requiring ethanol use in RFG. The Governors Ethanol Coalition, for 
instance, suggested that EPA require the RFG market to satisfy its 
oxygenate requirements through a minimum percentage of domestically 
produced renewable fuel.
    Based on ethanol's importance to the nation's energy and 
agricultural policy, President Bush on October 1, 1992 announced a plan 
to allow ethanol to effectively compete in the RFG program, with the 
expectation that, with barriers removed, ethanol use would grow. In 
lieu of an RVP waiver, or inclusion of ozone reactivity this plan was 
based upon provisions of section 211(k)(1) allowing the Administrator 
to take into consideration cost, energy requirements, and other 
specified factors in setting RFG performance standards. The most 
significant part of this plan called for EPA to ``establish rules for 
reformulated gasoline in all northern cities that will have the effect 
of granting a one-pound waiver for the first 30 percent market share of 
ethanol blends, while achieving environmental benefits comparable to 
those provided for in EPA's proposed rule and regulatory negotiation.'' 
The environmental benefits of the proposed RFG program would be 
maintained by offsetting any increase in volatility of RFG containing 
ethanol with reductions in the volatility of the rest of the 
reformulated gasoline pool. In response to the announcement by former 
President Bush, EPA proposed on February 26, 1993 provisions to provide 
an RVP (and VOC) incentive for the use in reformulated gasoline of 
renewable oxygenates such as ethanol.

B. Concerns With the Proposal

    At the time of the February 26, 1993 proposal, EPA had a number of 
concerns with respect to its legality, energy benefits, and 
environmental neutrality. Nevertheless, we proposed the provisions for 
public comment in the hope that these concerns could be overcome based 
on new data and information developed in-house or received through 
public comment. Since the time of the proposal these concerns have been 
enhanced. Additional data and information has been developed which 
indicates that energy benefits would be unlikely to occur as a result 
of the proposal. While the production of much of the ethanol in the 
country produces on the margin more energy and uses less petroleum than 
went into its production, a recent study by the Department of Energy 
(refer to DOE's comments on the proposal) indicates that the margin 
disappears when ethanol is mixed with gasoline. The energy loss and 
additional petroleum consumption necessary to reduce the volatility of 
the blend to offset the volatility increase caused by the ethanol 
causes the energy balance and petroleum balance to go negative. Since 
the potential energy benefits were the basis in the proposal for 
providing the incentives for renewable oxygenates, the justification 
for the proposal no longer exists.
    Additional data and information has also been developed which 
indicates that VOC emissions would increase significantly under the 
proposal. As discussed in section I of the RIA, the commingling effect 
of mixing ethanol blends with non-ethanol blends in consumer's fuel 
tanks, the effect of ethanol on the distillation curve of the blend, 
and unrestricted early use of the complex model combined result in 
roughly a 6-7.5% increase in gasoline vehicle VOC emissions even though 
there is no increase in the average RVP of in-use gasoline. As a 
result, the proposal would have sacrificed 40 to 50 percent of the VOC 
control that is required under section 211(k) for reformulated gasoline 
in exchange for incentives for what is likely to have been only a 
marginal increase in the market share of ethanol in reformulated 
gasoline and no energy benefits or cost savings.
    As discussed in section I of the RIA, ethanol is not excluded from 
competing in the reformulated gasoline market under the provisions of 
the April 16, 1992 SNPRM. As a result of the economic advantage of 
ethanol over other oxygenates, ethanol should maintain a significant 
market share under the reformulated gasoline program even without the 
renewable oxygenate incentives proposed in the February 16, 1993 
proposal. As a result, the actual ethanol market share increase as a 
result of the renewable oxygenate provisions would be expected to be 
far less than the maximum of 30% for which incentives were provided. 
Given the relatively small increase in ethanol demand as a result of 
the renewable oxygenate provisions in exchange for such a large loss in 
the environmental control of the reformulated gasoline program, there 
does not appear to be any justification for promulgating these 
provisions.
    Furthermore, comments were received from virtually all parties, 
including ethanol industry representatives, that the proposal was 
unworkable and would significantly increase the cost of the 
reformulated gasoline program. While EPA maintains that the program 
would have provided an economic incentive for the use of renewable 
oxygenates in reformulated gasoline up to a 30% market share, EPA 
acknowledges that the proposal would have intruded into the efficient 
operation of the marketplace, impacting the cost of the reformulated 
gasoline program. As a result, after taking into account the cost, non-
air quality and environmental impacts, and energy impacts, EPA has 
found itself with no choice but to back away from the renewable 
oxygenate provisions of the February 26, 1993 proposal.

C. Provisions for the Final Rule

    In lieu of the renewable oxygenate proposal, EPA investigated a 
number of options aimed at making the program more workable by reducing 
the fuel tracking, recordkeeping, and enforcement burden associated 
with the proposal. While such options tended to make the program more 
workable from the standpoint of the refining and fuel distribution 
processes, they also tended to either reduce the assurance that the 
environmental benefits of the program would be achieved in all areas 
covered by the RFG program, or to place additional restrictions on the 
flexibility contained in the proposal for blending ethanol into 
gasoline. Given this and the other concerns with the proposal (cost, 
lack of energy benefits, significant environmental loss, etc.), EPA did 
not believe these options to be appropriate or justifiable either under 
the provisions of section 211(k) of the Act. The reader is referred to 
the Final Regulatory Impact Analysis for a detailed discussion of the 
renewable oxygenate program.
    A number of commenters suggested alternative provisions (1.0 psi 
RVP waiver for ethanol blends, inclusion of ozone reactivity in the 
standard setting process, mandates for refiners to provide clear 
gasoline blendstock for downstream blending with ethanol, etc.) to the 
proposed renewable oxygenate program to allow ethanol to play a larger 
role in the reformulated gasoline program. It was argued that without 
such provisions ethanol would be excluded from the market entirely in 
direct conflict with the intent of Congress in the CAA.
    EPA, however, does not agree that ethanol is excluded from 
competing in the reformulated gasoline marketplace under the provisions 
of the April 16, 1992 proposal. In fact, as under the recently 
implemented wintertime oxygenated fuels program, ethanol is expected to 
significantly increase its market share under the reformulated gasoline 
program, especially in Midwestern areas where ethanol enjoys State tax 
incentives and relatively low distribution costs. In addition, not only 
is ethanol expected to compete as an alcohol, but it also may compete 
with methanol as an ether feedstock in the future. As a result, EPA 
believes that the treatment of ethanol blends under the April 16, 1992 
proposal is entirely consistent with the intent of Congress as 
expressed in section 211(k) of the CAA.
    The alternative provisions (1.0 psi RVP waiver for ethanol blends, 
inclusion of ozone reactivity in the standard setting process, mandates 
for refiners to provide clear gasoline blendstock for downstream 
blending with ethanol, etc.) suggested by various commenters to further 
enhance the competitiveness of ethanol in the reformulated gasoline 
program are not appropriate. These provisions are both outside of EPA's 
legal authority under the CAA, and indefensible from an environmental 
and scientific standpoint. The 1.0 psi waiver for example, could easily 
forfeit all VOC emission reductions otherwise achieved by the 
reformulated gasoline program. A move away from the mass based 
standards of the Act to reactivity based standards is not only 
unsupportable on the basis of the available scientific information, but 
even if EPA were able to do so, it would be unlikely to provide any 
significant advantage for ethanol blends. As discussed in section I of 
the RIA, the recent urban airshed modeling studies claiming that 
ethanol blends with a 1.0 psi waiver do not increase ozone relative to 
an MTBE blended reformulated gasoline are frought with invalid 
assumptions and inconsistencies and are not applicable to the 
reformulated gasoline situation. As a result, they provide no credible 
scientific support for special provisions for ethanol in the context of 
the reformulated gasoline program.
    Given the lack of justification for the renewable oxygenate 
provisions of the February 26, 1993 proposal, the options considered 
for simplifying that proposal, and other alternative provisions 
recommended by commenters, EPA is, thus, basing the oxygenate-related 
provisions of the final rule on the provisions as proposed in the April 
16, 1992 proposal. Despite this decision, EPA still believes ethanol 
will be able to compete favorably in the reformulated gasoline market 
either as a direct additive or as an ether feedstock as discussed 
above. As such, EPA believes that the nationwide production of ethanol 
will increase as a result of this rulemaking with corresponding 
benefits to our Nation's agricultural sector. However, the increase may 
not be as large as it otherwise would have been had an incentive 
program been promulgated for ethanol. The reader is referred to section 
I. of the RIA for additional description of the comments and 
information which led up to this decision.

III. Simple Model for Reformulated Gasoline Compliance

    In accordance with section 211(k) of the Clean Air Act, EPA 
requires that in order for a gasoline to be certified as reformulated, 
it must contain at least 2.0 weight percent oxygen, no more than 1.0 
volume percent benzene, and no heavy metals (unless a waiver is 
granted); result in no increase in NOX emissions; and achieve 
required toxics and VOC emission reductions. The VOC, NOX, and 
toxics emission requirements effective between January 1, 1995 and 
December 31, 1997 and EPA's derivation of them are set forth below.
    Two methods by which refiners can certify their fuel as meeting the 
VOC, NOX, and toxics requirements of reformulated gasoline are 
contained in this rulemaking. The first, by use of a ``Simple Model,'' 
is described in this section. A second method, the use of the ``Complex 
Model'' is described in Section IV. Provisions for augmenting the 
Complex Model through vehicle testing are described in Section V. For 
reasons set forth in the April 16, 1992 SNPRM (57 FR 13417-13418) and 
discussed Section V, vehicle testing is not an option as a separate, 
stand-alone method of certification. First, models can better reflect 
in-use emission effects since they can be based on the results of 
multiple test programs. Second, individual test programs may be biased, 
either intentionally or unintentionally. Third, fuel compositions tend 
to vary due in part to factors beyond the control of fuel suppliers, 
potentially requiring testing of each batch if a model is not used. 
Finally, models make more efficient use of scarce and expensive 
emissions effects data than is otherwise possible. For these reasons, 
EPA believes that the modeling options promulgated by EPA are necessary 
for the reformulated gasoline program to achieve its environmental 
objectives and to minimize the costs of the program. Comments were 
received suggesting that EPA allow certification based on testing as an 
optional means of certification. However, for the same reasons 
discussed above, EPA does not believe such an option would be 
appropriate. EPA would have much less certainty that the results of the 
test program were valid.
    At the time of the simple model proposal, while a number of fuel 
parameters were thought to impact emissions, data were sufficient for 
only a few of these parameters (Reid vapor pressure, fuel oxygen, 
benzene, and aromatics) to quantify their effect with reasonable 
accuracy for use in an emissions model. For those additional parameters 
which were thought to impact emissions in a directionally clear, but as 
of yet unquantifiable manner (sulfur, T90, and olefins), EPA proposed 
that they be capped at the refiner's 1990 average level to prevent 
emission effects from changes in their levels from undercutting the 
emission reductions achieved by the parameters contained in the simple 
model. The effect of aromatics on VOC and NOX emissions was also 
unclear, but instead of being capped, it was believed that the level of 
aromatics would be controlled by the role aromatics plays in the 
formation of air toxics emissions.
    Data is now available to accurately quantify not only the effects 
of RVP, oxygen, benzene, and aromatics on emissions, but also sulfur, 
T90 (or E300), olefins, and T50 (or E200). The effects of these fuel 
parameters are incorporated into the Complex Model described in Section 
IV.
    The Complex Model is the most accurate and complete model currently 
available for use in the reformulated gasoline program. Absent any 
other considerations, EPA would require use of the Complex Model for 
purposes of certification. However, based on leadtime considerations, 
EPA is allowing use of either the Simple or Complex Model during the 
first three years of the reformulated gasoline program as proposed. 
These lead time considerations were described in the April 1992 
proposal (57 FR 13417-8). EPA is providing four years leadtime before 
use of the Complex Model is mandatory to allow the regulated industry 
adequate time to plan and design necessary refinery modifications, 
obtain necessary permits and capital, complete construction, and 
complete start-up and equipment shakedown. Furthermore, EPA has every 
confidence that on average the refiners certifying their fuel using the 
Simple Model will achieve the emission reductions that Congress 
intended for the reformulated gasoline program.
    Various comments were received criticizing the use of the Simple 
Model for fuel certification, stating that it had limited flexibility, 
discouraged innovation, penalized refiners producing cleaner than 
average gasoline in 1990, and should be scrapped. Many of these 
comments would appear to be resolved by the option available for early 
use of the Complex Model. Therefore, in keeping with the need to 
provide adequate lead time and the fact that compliance with the Simple 
Model will produce the mandatory VOC and toxic emission reductions, 
refiners will be permitted to use the simple model for certification 
until December 31, 1997. Until this date, fuel suppliers will have the 
option of using the complex model instead of the simple model to take 
advantage of the effects of parameters contained in the complex model 
but not contained in the simple model (as described in the following 
paragraphs). The reader is referred to the April 16, 1992 SNPRM for 
more discussion of these lead time provisions.

A. Simple VOC Emissions Model

    The simple model for VOC emissions is comprised of fuel 
specifications for RVP and oxygen. Fuels sold at retail outlets must 
have an RVP during the high ozone season (June 1 through September 15) 
of no more than 7.2 psi in VOC control region 1 (the southern areas 
typically covered by ASTM class B during the summer) and 8.1 psi in VOC 
control region 2 (the northern areas typically covered by ASTM class C 
during the summer).1 The differences in climate between these two 
types of areas requires a corresponding difference in gasoline 
volatility to achieve the same emissions effect. The period of June 1 
through September 15 was chosen for the high ozone season because most 
of the ozone violations occur during this period. (See 56 FR 24242 for 
a discussion of the determination of this period.)
---------------------------------------------------------------------------

    \1\Lower RVP limits apply for fuels that comply under averaging. 
RVP controls also apply from May 1 to May 31 for facilities upstream 
of retail outlets. These issues are discussed elsewhere in this 
proposal.
---------------------------------------------------------------------------

    Section 211(k)(3) of the Act requires that at a minimum 
reformulated gasoline comply with the more stringent of either a 15% 
reduction in VOC emissions or a formula fuel described in that section, 
whichever is greater. EPA has determined that the formula fuel would 
achieve less than a 15% reduction in VOC. As such, the minimum VOC 
emission reduction required by the Act is 15%. As discussed in section 
IV, EPA believes that the VOC emission reduction in VOC control region 
2 from a fuel with an RVP of 8.1 psi and 2.0 weight percent oxygen will 
be sufficient to achieve the minimum 15% VOC emission reduction 
relative to the Clean Air Act baseline gasoline (which has an RVP of 
8.7 psi). In VOC control region 1, an 8.1 psi RVP fuel with 2.0 percent 
oxygen (which would meet the minimum 15% reduction requirement relative 
to the CAA baseline fuel) would actually have greater emissions than a 
fuel meeting EPA's Phase II RVP control standards for VOC control 
region 1 (maximum RVP of 7.8 psi). EPA believes that when Congress 
designated cities for inclusion in the reformulated gasoline program 
that it intended the program to provide emissions reductions in 
addition to those provided by the Phase II RVP requirements. If EPA 
merely required reformulated gasoline in VOC control region 1 to meet 
the RVP requirement for VOC control region 2, then no reduction in VOC 
emissions would accrue under the first phase of the reformulated 
gasoline program beyond those mandated by Phase II RVP standards. EPA 
projects that relative to Phase II RVP control levels, a fuel with 7.2 
psi RVP and 2.0 weight percent oxygen would provide VOC emission 
reductions in VOC control region 1 similar to those obtained in VOC 
control region 2.
    While requiring reformulated gasoline sold in VOC control region 1 
to have an RVP of no more than 7.2 psi goes beyond the minimum 
requirement stated in section 211(k)(3), section 211(k)(1) authorizes 
EPA to require emission reductions in VOC control region 1 of this 
magnitude because they are achievable considering costs, other air 
quality and non-air quality impacts, and the energy implications of 
such a requirement.
    Similarly, EPA believes that additional VOC reductions are 
obtainable if refiners are allowed to meet the RVP and oxygen standards 
through averaging. If refiners wish to take advantage of averaging, EPA 
thus will require their average RVP for both VOC control regions 1 and 
2 to be reduced by 0.1 psi to 7.1 and 8.0 psi, respectively, and the 
average oxygen concentration to be increased to 2.1 weight percent 
oxygen. For additional discussion of the rationale for the more 
stringent standard in VOC control region 1 and the increase in 
stringency of the averaging standards, the reader is referred to the 
April 16, 1992 SNPRM.

B. Simple NOx Emissions Model

    The Clean Air Act requires that there be no NOX emissions 
increase from reformulated fuels. Based on data available during the 
regulatory negotiations and at the time of the April 16, 1992 proposal, 
it appeared that fuel oxygen content and the type of oxygenate used may 
have an impact on NOX emissions while no other simple model 
parameter appeared to have such an impact. Due to the statutory 
requirement for oxygenate use, and the lack of any other parameters in 
the simple model by which refiners could offset any NOX increase, 
EPA needed to place restrictions on the amount of oxygen that could be 
added to the fuel in order to prevent NOX emission increases. EPA 
proposed on the basis of the data then available that MTBE blends 
containing up to 2.7 weight percent (wt%) oxygen and other blends 
containing up to 2.1 wt% oxygen would be presumed to result in no 
NOX increase. Greater oxygenate concentrations could not be 
permitted due to the risk of NOX emission increases.
    When additional data became available, however, there did not 
appear to be any significant difference between the NOX emission 
effects of oxygen from different oxygenates. Furthermore, it appeared 
that reducing the concentration of a number of additional fuel 
parameters (aromatics, olefins, sulfur, etc) could reduce NOX 
emissions. Since these fuel parameters all tend to be reduced to 
varying degrees when oxygenates are added to gasoline, EPA proposed in 
its February 26, 1993 proposal that all oxygenates be assumed to result 
in no NOX emission increase under the simple model up to 2.7 wt% 
oxygen.
    Under the final Complex Model discussed in Section IV, oxygen has 
been found to result in no NOX increase, in fact, it results in a 
very slight decrease. However, the other changes that occur to the fuel 
when oxygenates are added both increase and decrease NOX emissions 
(increases in E200 increase NOX emissions while reductions in 
sulfur, olefins, aromatics, and increases in E300 reduce NOX 
emissions). Typically the effect of these other fuel changes will be to 
further reduce NOX emissions. However, there is no control placed 
on E200 levels under the simple model, and the levels of sulfur, 
olefins, an E300 are only constrained to the refiner's 1990 baseline 
levels (aromatics is controlled indirectly to some degree by the toxics 
requirement). As a result, there is no assurance under the simple model 
that oxygenate addition will not increase NOX emissions. The more 
oxygenate added, the greater the increase in E200, and the greater the 
possibility for a NOX increase. For this reason EPA believes it is 
still appropriate to cap the maximum oxygen content under the Simple 
Model at 2.7 wt%. Any higher oxygen concentrations will require use of 
the complex model.
    However, for a number of reasons, EPA believes it is appropriate 
for any oxygenate up to 3.5 weight percent oxygen to be presumed to 
result in no NOX emission increase under the simple model during 
those months without ozone violations (e.g., winter months) unless a 
state requests that oxygenate levels be limited to the 2.7 wt% oxygen 
level applicable during those months with ozone violations. First, 
although there are a number of concerns associated with NOX 
emissions, the main concern of focus in this rulemaking is ozone which 
is for the most part a summertime problem. Second, while there is no 
assurance that individual batches of gasoline containing more than 2.7 
wt% oxygen will not increase NOX emissions, the increase, if any, 
would be small (i.e., likely less than 1 percent). Third, on average 
across all fuel produced by all refiners in an area, a NOX 
reduction may still occur. Fourth, there are benefits to the use of 
oxygenates during the winter months (lower CO and air toxics emissions) 
that may be more important to individual states than the certainty that 
no one batch of fuel increases NOX emissions relative to the 1990 
baseline.
    A state may make a request for the 2.7 wt% oxygen limit to apply 
during the non-ozone season when it believes that the use of higher 
oxygenate levels would interfere with attainment or maintenance of 
another ambient air quality standard (other than ozone) or another air 
quality problem. This proposal parallels the Regulatory Negotiation 
Agreement of August 16, 1991 and EPA's letter to the Renewable Fuels 
Association dated August 14, 1991.

C. Simple Toxics Emissions Model

    Under section 211(k)(3), EPA must at a minimum require the more 
stringent of either a specified formula fuel or a 15 percent reduction 
in toxics emissions from that of baseline gasoline. All five of the 
toxic air pollutants that section 211(k)(10) of the Act specifies for 
control through reformulated gasoline (benzene, 1,3-butadiene, 
polycyclic organic matter (POM), formaldehyde, and acetaldehyde) also 
fall under the category of VOCs. Exhaust emissions include unburned 
benzene and benzene formed from other aromatics during the combustion 
process. Benzene, an aromatic compound, is a natural component of 
gasoline and, as such, is present in evaporative, running loss and 
refueling emissions (nonexhaust emissions). However, nonexhaust VOC and 
benzene emissions data are only available in sufficient quantities 
under high ozone test conditions. Therefore, nonexhaust benzene 
emissions are not considered outside of the high ozone season. The four 
other toxic air pollutants subject to control by reformulated gasoline 
are not present in gasoline and hence are solely products of 
combustion.
    The equations that represent the simple model for air toxics 
emissions are shown in section 80.42 of the regulations. The derivation 
and referenced work is given in the regulatory impact analysis.
     Only minor changes were made to the proposed simple toxics model. 
One change excluded ethane from the exhaust VOC baseline emissions as 
discussed below in Section III.D.3. The weight fractions of the various 
toxics as a function of VOC have also been adjusted accordingly, 
resulting in no net change in predicted toxics performance for a 
particular fuel. At the request of commenters, EPA has also included 
the oxygenates tertiary amyl methal ether (TAME) and ethyl tertiary 
amyl ether (ETAE) as well as provisions for other oxygenates and mixed 
oxygenates. Due to their similar chemical makeup, methyl ethers (such 
as TAME) and ethyl ethers (such as ETAE) are to be modeled using the 
same equations as for MTBE and as for ETBE, respectively. Higher 
alcohols will be modeled using the same equations as for ethanol. 
Higher ethers will be modeled as ETBE for all air toxics, since ETBE 
was the highest ether for which toxics data were available.

D. Baseline Determination

    Where the performance standard is more stringent than the formula, 
the Act requires EPA to promulgate standards for the performance of 
reformulated gasoline that are relative to emission levels from 
baseline vehicles using baseline fuel. In order to determine whether 
fuels meet the performance requirements of reformulated gasoline under 
the simple model, EPA must therefore establish the baseline to which 
the emission performance of reformulated fuels are to be compared. The 
following discussion describes how EPA derived the emission baselines.
1. Control Periods
    Before the emission baselines can be determined, the time frame 
over which fuel performance will be evaluated must be identified. 
Section 211(k) of the Act requires control of VOC emissions during the 
``high ozone season.'' For the purposes of this rulemaking, the high 
ozone season is defined to be June 1 through September 15. This period 
covers the vast majority of days during which the national ambient air 
quality standard for ozone is exceeded nationwide and is consistent 
with the period covered by EPA's gasoline volatility control 
requirements. All gasoline at service stations must thus comply with 
the reformulated gasoline requirements during this period. Also in 
keeping with the gasoline volatility control rulemaking the ``VOC 
control Period'' for compliance with the reformulated gasoline 
provisions upstream from the service station (necessary to ensure 
complying fuel is available at the service stations during the high 
ozone season) is May 1 through September 15.
2. Baseline Gasoline
    The fuels to be used in determining baseline emissions are 
unchanged from the February 26, 1993 proposal and are shown below. 

                Table III-1.--Baseline Fuel Compositions                
------------------------------------------------------------------------
                                                     Summer     Winter  
------------------------------------------------------------------------
Sulfur, ppm.......................................    339        338    
Benzene, volume percent...........................      1.53       1.64 
RVP, psi..........................................      8.7       11.5  
Octane, R+M/2.....................................     87.3       88.2  
T10, degrees F....................................    128        112    
T50, degrees F....................................    218        200    
T90, degrees F....................................    330        333    
Aromatics, volume percent.........................     32.0       26.4  
Olefins, volume percent...........................      9.2       11.9  
Saturates, volume percent.........................     58.8       61.7  
------------------------------------------------------------------------

3. Definition of Ozone-Forming VOC
    The Act requires reductions in emissions of ozone-forming VOCs. 
This interpretation is consistent with the focus of Section 211(k) on 
the areas with the most extreme ozone pollution problem. EPA proposed 
in April 16, 1992 that methane would be excluded from the definition of 
VOC on the basis of its low reactivity in keeping with past EPA 
actions, but included all other VOCs including ethane. EPA further 
proposed, however, that should the Agency modify the definition of VOC, 
we might do so for the reformulated gasoline rulemaking as well. As 
discussed in the February 26, 1993 proposal, EPA has also modified the 
definition of VOC to exclude ethane in a separate Agency rulemaking (57 
FR 3941). As a result, the performance of fuels meeting the VOC 
emission requirements under the simple model are expressed on a non-
methane, non-ethane basis. This change resulted in slight changes to 
the simple model equations previously proposed, but the overall results 
of the simple model are essentially unaffected.
4. Simple Model Baseline
    The following table shows the baseline emissions under the simple 
model which result from the assumptions discussed above. Since the 
MOBILE model does not estimate toxics emissions, however, separate data 
and information was necessary to determine their baseline emissions. 
The toxics baseline was developed in essentially the same manner as 
that proposed in the April 16, 1992 proposal. An explanation of this 
derivation can be found in Section II of the RIA. 

             Table III-2.--Simple Model Baseline Emissions              
------------------------------------------------------------------------
                                            Summer                      
                                  --------------------------   Winter   
                                    Region 1     Region 2               
------------------------------------------------------------------------
Exhaust VOCs (g/mi)..............       0.444        0.444        0.656 
Non-Exhaust VOC (g/mi)...........        .856         .766        0     
Total VOCs (g/mi)................       1.30         1.21         0.656 
Exhaust Benzene (mg/mi)..........      30.1         30.1         40.9   
Evaporative Benzene..............       4.3          3.8          0.0   
Running Loss Benzene.............       4.9          4.5          0.0   
Refueling Benzene................       0.4          0.4          0.0   
1,3-Butadiene....................       2.5          2.5          3.6   
Formaldehyde.....................       5.6          5.6          5.6   
Acetaldehyde.....................       4.0          4.0          4.0   
POMs.............................       1.4          1.4          1.4   
                                  --------------------------------------
    Total TAPs (mg/mi)...........      53.2         52.1         55.5   
------------------------------------------------------------------------

E. Phase I Performance Standards Under the Simple Model

    Section 211(k)(3) directs EPA to require, at minimum, that Phase I 
reformulated gasoline comply with the more stringent of two alternative 
VOC and toxics emission requirements--either a performance standard of 
a 15 percent reduction from baseline levels on a mass basis, or 
compositional requirements specified as a formula in Section 
211(k)(3)(A). The formula effectively defines a set of maximum or 
minimum fuel parameter specifications. In evaluating which requirement 
is more stringent, EPA is to consider VOC and toxics separately.
    The stringency of the formula is best evaluated by determining the 
emissions performance of the fuels that would be certifiable if EPA 
were to impose the requirements of Section 211(k)(3)(A). A gasoline 
would meet these requirements if it (1) had no more than 1.0 volume 
percent benzene, (2) had no more than 25 volume percent aromatics, (3) 
had no less than 2.0 weight percent oxygen, and (4) met the 
requirements for detergent additives and lead content. The formula does 
not specify or limit any additional gasoline properties, and therefore 
a wide variety of fuels with very different properties would qualify as 
complying with the formula. For example, the formula specifies the 
weight percent oxygen but does not specify the type of oxygenate. If 
EPA were to impose the requirements of Section 211(k)(3)(A), then any 
approved oxygenate could be used to meet the formula's oxygen 
requirement, as long as it was blended to achieve the required weight 
percent oxygen. The same would be true of sulfur levels, distillation 
characteristics, olefin levels, RVP levels, and so on. As long as the 
formula's requirements were met, the fuel would be certifiable if EPA 
were to base its certification requirements on Section 211(k)(3)(A).
    To evaluate the emissions performance of the various fuels that 
would comply with the formula requirements, EPA used the Phase I 
complex model. Given the Phase I baseline emission levels, EPA 
considers the complex model to be the most appropriate means of 
evaluating emissions performance since it incorporates the Agency's 
most recent, complete, and accurate knowledge of the effects of fuel 
properties on VOC and toxics emissions. Since many of the fuel 
parameters that are not specified for the formula affect VOC and toxics 
emissions, the various possible formula fuels exhibit a wide variety of 
emission performance levels as these unspecified parameters vary. 
According to the Complex Model, requirements based on many possible 
formula fuels would be less stringent than requirements based on the 15 
percent minimum reduction requirements of Section (211)(k)(3)(B). In 
addition, the lack of specificity of the formula fuel would make 
establishment of an equivalent emissions performance standard 
impossible, since one or more possible formula fuels would fail to meet 
any specific standard.
    In past proposals, EPA has evaluated the formula fuel by assigning 
levels for unspecified parameters at their level in baseline gasoline, 
as defined in section 211(k)(9)(B) of the Act. However, such an 
interpretation would not eliminate the problems described above, since 
the oxygenate type would remain unspecified. Hence the requirements of 
a formula could be met by a range of fuels, each based on different 
oxygenates, even if unspecified parameters were to be set to baseline 
levels, and this range of fuels would exhibit a range of emission 
performance levels. While the Complex Model attributes identical 
effects to oxygen in different chemical forms for most pollutants, it 
incorporates emission effects that depend on the type of oxygenate used 
for nonexhaust benzene, acetaldehyde, and formaldehyde emissions. EPA 
therefore ran the complex model for several fuels, varying the type of 
oxygenate and holding other parameters not specified by the formula at 
statutory baseline levels.
    The VOC emission reductions from baseline levels for all such 
formula fuels were less than 15 percent. EPA therefore based the VOC 
emission requirements for Phase I reformulated gasoline on the 15 
percent reduction minimum performance standard, since this standard is 
more stringent than the requirements of the formula.
    For toxics performance, EPA separately evaluated the emissions 
performance of fuels that met the formula requirements and contained 
statutory baseline levels of unspecified fuel properties for VOC 
control regions 1 and 2, since nonexhaust benzene emissions would 
differ in these two regions. EPA also evaluated such fuels with 
different oxygenate types. The results are shown in Table II-3. These 
results include both summer and winter effects, weighted based on the 
share of vehicle miles traveled in each season. 

   Table II-3.--Phase I Toxics Emissions Performance of Formula Fuels   
------------------------------------------------------------------------
                                                 Percent reduction from 
                                                      CAAB levels       
                Oxygenate type                 -------------------------
                                                VOC control  VOC control
                                                 region 1      region 2 
------------------------------------------------------------------------
ETBE..........................................        11.82        11.65
Ethanol.......................................        13.16        13.01
MTBE..........................................        16.33        16.15
TAME..........................................        16.81        16.67
------------------------------------------------------------------------

    The results indicate that whether a formula fuel (with unspecified 
fuel parameters at statutory baseline levels) meets the 15% minimum 
performance requirement of section 211(k)(3)(B) depends on the type of 
oxygenate used. If EPA were to impose the formula requirements of 
section 211(k)(3)(A), the results presented in Table II-3 indicate that 
not all gasolines which could be certified as reformulated would 
achieve at least a 15 percent reduction in toxics mass emissions, even 
if unspecified fuel properties were set at statutory baseline levels. 
If EPA were to require a 15 percent emissions reduction in accordance 
with section 211(k)(3)(B), however, all fuels would achieve this 
minimum level of reductions. EPA therefore believes that the formula 
requirements of section 211(k)(3)(A) are not as stringent as the 
performance standard set forth in Section 211(k)(3)(B).
    The minimum performance standard for Phase II is even more 
stringent than the Phase I standards. EPA has therefore determined that 
the performance standard is more stringent than the formula for both 
VOCs and toxics, for both Phase I and Phase II. EPA must therefore set 
its Phase I requirements for both VOCs and toxics to be no less 
stringent than the 15 percent emission reduction performance standard 
required by section 211(k)(3)(B). EPA has considered whether it should 
require greater reductions in toxics mass emissions than that required 
by the 15 percent minimum performance standard. However, the Agency has 
concluded that more stringent toxics requirements are not cost-
effective, as is discussed more fully in Section VI. Hence EPA has set 
the Phase I toxic emission performance standard at the minimum 15 
percent reduction from baseline levels required by the Act. Compliance 
with this standard must be demonstrated using the appropriate emission 
models throughout Phase I.
    Under the authority of section 211(k)(1), EPA believes that the 
greater flexibility and reduced cost afforded to gasoline refiners and 
importers by an averaging program allow EPA to require a greater 
reduction in toxics emissions than is required under section 211(k)(3). 
As discussed in Section VII, the Agency believes it appropriate, when 
the air toxics standard is met on average, that it be 1.5 percentage 
points more stringent than standards met on a per-gallon basis. EPA 
estimates that the approximate 1.5 percentage point margin will be 
sufficient to recoup any compliance margin refiners would have 
otherwise had to maintain to ensure achievement of the toxics 
requirements in the absence of an averaging program. In sum, the 
tighter averaged standard should have the potential to increase the 
environmental benefits of the reformulated gasoline program while not 
increasing the cost of obtaining those benefits. As a result, the air 
toxics performance standard when met on an annual average basis is set 
at a 16.5% reduction from baseline levels.

F. Applicability (1995-7)

    The Simple Model described in this section is effective beginning 
January 1, 1995 with the beginning of the reformulated gasoline program 
as a means by which fuel producers can certify that their fuel meets 
the requirements for reformulated gasoline. The Complex Model described 
in Section IV will not be required to be used for fuel certification 
until January 1, 1998.
    Until January 1, 1998, refiners who produce reformulated gasoline 
will have a choice of certifying their gasoline by using either the 
Simple Model or the Complex Model. EPA proposed three options for 
establishing the performance standards under early, optional use of the 
Complex Model. Under one option, if a refiner opts to utilize the 
Complex Model before January 1, 1998 the reformulated gasoline can have 
no worse VOC, NOX, or toxic emissions performance than would be 
predicted by the Complex Model for a Simple-Model fuel (minimum 2.0 
percent oxygen, maximum 1.0 percent benzene, and maximum RVP of 8.1 psi 
in Class C areas and 7.2 psi in Class B areas) having that refiner's 
average 1990 levels of sulfur, olefins, and T90 (E300). The second 
option was a variation of the first, in that refiners producing 
gasoline for use in only the southern reformulated gasoline areas (VOC 
control region 1) could measure their fuel performance against the CAA 
baseline gasoline as an alternative to their own 1990 refinery 
baseline. The third option, proposed by EPA in February 1993, would 
extend the second option to all reformulated gasoline areas.
    The rationales for these options are discussed in detail in EPA's 
proposals. Many of the comments were also received prior to the 
proposals, and as such were addressed there. As a result, the reader is 
referred back to the proposals for additional discussion. After 
considering the comments, EPA has decided to promulgate the first 
option. First, under this option each refiner will have to achieve the 
same reductions, whether they use the simple model or the complex 
model. The option to use either model increases refiner flexibility, 
but will not change the emissions reductions required for a refiner 
prior to mandatory use of the complex model in 1998. EPA believes that 
the reductions required under the simple model are achievable 
considering all relevant factors and will continue to be so under the 
optional use of the complex model. In fact, the additional flexibility 
of using the complex model would in some cases make them even more 
reasonable.
    Second, the other two options create an incentive for early use of 
the complex model by those refiners who would then have a less 
stringent performance standard than under the simple model. This would 
produce on average an increase in overall emissions for reformulated 
gasoline compared to average emissions if only the simple model was 
allowed. Refiners with individual baselines for sulfur, T90 and olefins 
that are lower than the CAA baseline would, under the second and third 
options, get credit for emission benefits for these parameters, and 
could use this to justify a less stringent RVP control than required 
under the simple model. There would be no parallel disincentive to 
early use of the complex model for refiners with higher baselines which 
would result in an increase in their required reductions. This 
imbalance in the expected early use of the complex model could easily 
lead to an average 1-2 percentage point reduction in the average 
emission performance of reformulated gasoline from 1995-7 as discussed 
in section I of the RIA. Based on this negative environmental impact, 
and the reasonableness of the complex model performance standard under 
the first option, EPA has decided to promulgate the first option 
described above for early use of the complex model.

G. Enforcement of the Early Use Option

    Additional controls over reformulated gasoline certified using the 
``early-use'' complex model are necessary for the operation of the 
downstream enforcement mechanisms of VOC and NOX emissions 
performance minimums, and covered area gasoline quality surveys. These 
restrictions are necessary because under the restricted early-use 
approach being promulgated, VOC, toxics, and NOX percentage 
reductions are calculated from a baseline fuel using the refiner's 1990 
baseline levels of sulfur, T-90, and olefins. As a result, the 
reformulated gasolines produced by different refiners (or in some 
cases, at different refineries) under this option will likely each meet 
different percentage reduction standards for VOC, toxics, and NOX. 
Therefore, the performance of a fungible mixture of complex model 
gasolines produced by different refiners at different refineries could 
not be predicted, nor could be evaluated.\2\
---------------------------------------------------------------------------

    \2\Beginning in 1998, certification of reformulated gasoline 
using the simple model will no longer be an option, and all 
reformulated gasoline will be certified using the complex model. 
Also beginning in 1998, all refiners and importers will calculate 
emissions performance reductions from Clean Air Act average 
gasoline; individual refiner baselines will not be relevant to 
reformulated gasoline. As a result, the difficulties with downstream 
enforcement and surveys will be resolved.
---------------------------------------------------------------------------

    In order for the per-gallon minimums for VOC and NOX emissions 
performance to be monitored by downstream regulated parties and 
enforced by EPA, the baseline for a given gasoline sample must be 
known. Without knowledge of the baseline, it is not possible to 
determine whether the fuel complies with the per-gallon minimums, since 
it will be different for each refinery. Similarly, in order for the 
gasoline quality surveys to function under early use of the complex 
model, the baseline from which to determine the emission performance 
for VOC, toxics, and NOX must be known. Without knowledge of the 
baseline, it is not possible to determine whether the complex model 
fuels in an area on average meet the per-gallon standards.
    EPA received comments from two industry groups representing the 
refining industry on this issue. Both commenters stated that EPA should 
require that ``early-use'' complex model gasolines subject to different 
baselines be segregated through the gasoline distribution system. EPA 
is adopting this suggested approach as the best (and perhaps only) 
means of accommodating both the restricted early-use option and 
downstream enforcement of per-gallon minimums and gasoline quality 
surveys.
    Under this approach, gasoline sampled at any point in the 
distribution system would have known values for VOC, toxics, and 
NOX emissions performance that meet the per-gallon and minimum 
standards. Today's rule requires that these values must be included in 
the product transfer documents for ``early-use'' complex model 
gasoline, to inform downstream parties and EPA of the relevant per-
gallon and minimum values.
    Today's rule prohibits the commingling throughout the distribution 
system, including at retail outlets, of ``early-use'' complex model 
gasoline that is subject to different baselines. One commenter stated 
that the segregation of this gasoline should be through the terminal 
level only. EPA disagrees with this comment because segregation through 
the retail level also is necessary in order for gasoline quality 
surveys to function. Survey samples are taken at retail outlets, and 
the survey requires that the relevant per-gallon values for VOC, 
toxics, and NOX emissions performance must be known for each 
sample.
    EPA realizes that restrictions on commingling of ``early-use'' 
complex model gasolines constitutes a significant constraint on the use 
of this option, because most gasoline used in the United States is 
transported as a fungible commodity. As a result, EPA anticipates that 
before 1998 the complex model will be used only in limited situations. 
This might occur where a refiner has a gasoline transportation system 
that is dedicated from the refinery through the retail level, or where 
the cost advantages of using the complex model are sufficiently large 
to offset the difficulties of segregation. In spite of these 
constraints, EPA sees no alternative to requiring segregation controls 
over ``early-use'' complex model gasoline.

IV. Complex Model

    The complex model described in this section has undergone 
significant changes since it was first proposed in the February 1993 
NPRM. These changes have been made in response to three key factors: 
EPA's improved understanding of the relationship between fuel 
characteristics and emissions, EPA's use of more appropriate data 
analysis methods, and comments received in response to the February 
NPRM, a public workshop held on May 25, 1993, and EPA's July 14, 1993 
docket submission that described a number of alternative complex 
models. The key elements in the complex model being promulgated today 
are discussed in this section. This discussion also addresses the major 
substantive comments received by EPA regarding the complex model. A 
more detailed description of the model and its derivation, including a 
detailed summary and analysis of comments, can be found in Section IV 
of the RIA.

Baseline Emissions

    As discussed in Section III, EPA is using a July 11, 1991 version 
of MOBILE4.1 to estimate baseline emissions from light-duty vehicles 
for the simple model, assuming a basic inspection and maintenance 
program. This baseline was developed in the regulatory negotiation and 
was at the time the best estimate of the in-use emission performance of 
1990 vehicles from which to ensure that the minimum performance 
standards required by section 211(k) of the Clean Air Act would be 
achieved.
    Since that time the Agency has developed a new version of the 
MOBILE model, MOBILE5a, for use by the states in demonstrating 
compliance with the national ambient air quality standard for ozone. As 
proposed in the February 26, 1993 proposal, EPA will use MOBILE5a in 
conjunction with an enhanced I/M program to establish the emission 
baseline for Phase II of the reformulated gasoline program beginning in 
the year 2000. EPA, however, has decided to retain the MOBILE4.1 and 
basic I/M baseline assumption for the simple model during Phase I of 
the RFG program. Switching to a MOBILE5a baseline for Phase I would 
have required reformulated fuels to meet a slightly more stringent RVP 
standard to maintain the minimum VOC emissions performance required by 
the Act. The majority of the VOC emission reductions achieved by RFG 
are from nonexhaust emissions; under MOBILE5a, nonexhaust VOC emission 
reductions are less effective in reducing overall VOC emissions than 
are exhaust VOC reductions, while the opposite is true under MOBILE4.1. 
Thus, in order to provide refiners with sufficient leadtime to complete 
the investments needed to meet the requirements of the program, the 
baseline for the Simple Model is determined using MOBILE4.1.
    When replacement of the Simple Model with the Complex Model is 
required in 1998, the issue again arises as to whether a more stringent 
standard should be required by shifting to use of MOBILE5a in 
determining the baseline. MOBILE5a clearly provides a more recent 
estimate of the mobile source VOC inventory than does MOBILE4.1. 
However, many of the changes made in MOBILE5a were intended to 
significantly increase the accuracy of the exhaust emission estimates 
while similar changes which would have increased the accuracy of the 
nonexhaust VOC emission estimate were not incorporated for various 
reasons, including the limited time available to revise the MOBILE 
model. As a result, the proportional contribution of exhaust and 
nonexhaust VOC emissions to the in-use VOC inventory may not be any 
more accurate in MOBILE5a than in MOBILE4.1 even though MOBILE5a 
provides a more accurate assessment of the total contribution of mobile 
sources to the entire VOC inventory by virtue of its greater accuracy 
in estimating exhaust VOC emissions. Since it is the relative 
proportions of exhaust and nonexhaust VOC emissions and not the overall 
magnitude of the mobile source VOC inventory which determines how 
difficult it will be for refiners to meet the overall VOC standard in 
1998, it is unclear whether MOBILE5a would be more appropriate to use 
in 1998 than MOBILE4.1.
    A simple model fuel evaluated using the complex model achieves more 
than the minimum 15% requirement of the Act using the MOBILE4.1 
baseline exhaust/nonexhaust ratio but less than the 15% requirement 
using the MOBILE5a baseline exhaust/nonexhaust ratio. Given the 
uncertainty in the actual in-use exhaust/nonexhaust ratio during this 
interim period, it is difficult to know whether or not the 15% actually 
would be achieved in-use by a fuel meeting the requirements of the 
Simple Model. Using MOBILE4.1 to determine the baseline in 1998 would 
introduce some risk that the 15% minimum performance requirement of the 
Act would not be met in-use by a fuel meeting the requirements of the 
Simple Model. However, this risk is relatively small in magnitude (less 
than three percentage points of emission reduction are at stake) and 
duration (the risk exists for only two years). On the other hand, using 
MOBILE5a to determine the 1998 baseline would result in some risk that 
refiners would be required to incur greater costs to achieve a more 
stringent standard than the minimum required by the Act. This greater 
stringency would have the effect of creating a third interim phase to 
the RFG program.
    Given the uncertainty in determining whether a MOBILE4.1-based 
performance standard or a MOBILE5a-based standard more accurately 
reflects the in-use conditions in 1998, the potential disruption to 
refinery operations (even if only for a small increase in the 
stringency of the fuel reformulation requirements), the fact that a 
more stringent standard in 1998 was not discussed or envisioned as part 
of the regulatory negotiation process, and the fact that any risk to 
the environment is small and of short duration, EPA does not believe it 
to be appropriate to base the Phase I complex model standards on 
MOBILE5a and require refiners to meet a more stringent performance 
standard in 1998. As a result, EPA will retain MOBILE4.1 with basic I/M 
as the basis for the Phase I performance standards under the Complex 
Model in 1998.
    In summary, EPA has retained the VOC and NOX baselines 
proposed in the SNPRM, including the relevant I/M assumptions, for use 
with the complex model prior to 2000. The onset of the Phase II 
performance standards in 2000 will increase the overall stringency of 
the standards, and a new baseline based on MOBILE5A will not, by 
itself, be the cause of new investment by refiners. By this time, 
enhanced I/M programs should be fully operational in nearly all 
reformulated gasoline areas. Therefore, baseline VOC and NOX 
emission levels to be used with the complex model in Phase II are based 
on MOBILE5A's estimate of emissions from light-duty vehicles and trucks 
with enhanced I/M.
    Baseline estimates of toxics emissions are not available directly 
from the MOBILE models. The nonexhaust toxics model bases its estimates 
of nonexhaust toxics on the RVP and benzene levels of the fuel. Since 
both of these levels are specified for Clean Air Act baseline (CAAB) 
gasoline, EPA has used the nonexhaust toxics model to determine the 
baseline nonexhaust toxics emission level. The exhaust toxics baseline 
has been estimated by multiplying the exhaust toxics emission level 
predicted by the complex model for CAAB gasoline by the ratio of 
baseline exhaust VOC emissions to the average exhaust VOC emission 
measurement in the complex model database. Since the five regulated 
exhaust toxic pollutants are all classified as VOCs, this adjustment 
sets the baseline exhaust toxics level equal to the exhaust toxics 
levels that would have been observed if the vehicles represented by the 
complex model database had VOC emission levels representative of in-use 
vehicles when tested on CAAB gasoline. No comments were received 
opposing this approach, which is discussed in more detail in Section 
III of the RIA.
    In evaluating the performance of simple model fuels, EPA has 
focused its attention on the average refiner. The need to compensate 
for differences between individual refinery baselines and the Clean Air 
Act baseline when the use of the complex model becomes mandatory has 
been communicated in past proposals, workshops, and the discussions 
associated with the Agreement in Principle. Hence refiners have been 
given adequate notice that if their baseline fuel produces higher 
emissions than CAAB fuel, then they must offset such emissions when the 
use of the complex model becomes mandatory in 1998. The four years 
before use of the complex model becomes mandatory is adequate leadtime 
for refiners. Refiners undertaking investments to comply with the 
simple model requirements have been made aware of these requirements, 
and this transition process was inherent in the regulatory negotiation 
agreement and in prior proposals. EPA recognizes that the precise 
emissions impact of individual refiner baselines could not be 
determined with confidence until the Complex Model was promulgated. 
However, refiners were aware of at least one course of action that 
would satisfy the requirements of the program under the complex model, 
namely to alter their baseline fuel to match the Clean Air Act baseline 
prior to meeting the simple model requirements.
    Baseline emissions of VOC, NOx, and toxics are given in Table 
IV-1 for Phase I and in Table IV-2 for Phase II. Summer and winter 
baselines are shown for both phases, with summer baseline emissions for 
VOC Control Regions 1 and 2 shown separately. The toxics emission 
baseline shown in Table IV-1 is applicable only during 1998 and 1999 
and for those refiners choosing to use the complex model prior to 1998; 
the baselines shown in Table IV-2 are applicable in 2000 and beyond. 

        Table IV-1.--Phase I Baseline Emissions, Milligrams/Mile        
------------------------------------------------------------------------
                                                  Summer                
            Pollutant             --------------------------------------
                                    Region 1     Region 2      Winter   
------------------------------------------------------------------------
Running loss VOC.................       430.77       390.42         0.00
Hot soak VOC.....................       264.61       229.96         0.00
Diurnal VOC......................       125.09       108.71         0.00
Refueling VOC....................        40.01        40.01         0.00
                                                                        
------------------------------------------------------------------------
Nonexhaust VOC...................       860.48       769.10         0.00
Exhaust VOC......................       446.00       446.00       660.00
Total VOC........................      1306.48      1215.10       660.00
NOx..............................       660.00       660.00       750.00
Running loss benzene.............         4.92         4.46         0.00
Hot soak benzene.................         3.02         2.63         0.00
Diurnal benzene..................         1.30         1.13         0.00
Refueling benzene................         0.42         0.42         0.00
                                                                        
------------------------------------------------------------------------
Nonexhaust toxics................         9.66         8.63         0.00
Exhaust benzene..................        26.10        26.10        37.57
Acetaldehyde.....................         2.19         2.19         3.57
Formaldehyde.....................         4.85         4.85         7.73
1,3-butadiene....................         4.31         4.31         7.27
POM..............................         1.50         1.50         2.21
                                                                        
------------------------------------------------------------------------
Exhaust toxics...................        38.95        38.95        58.36
    Total toxics.................        48.61        47.58       58.36 
------------------------------------------------------------------------


       Table IV-1.--Phase II Baseline Emissions, Milligrams/Mile        
------------------------------------------------------------------------
                                                  Summer                
            Pollutant             --------------------------------------
                                    Region 1     Region 2      Winter   
------------------------------------------------------------------------
Running loss VOC.................       328.53       294.15         0.00
Hot soak VOC.....................        84.11        80.97         0.00
Diurnal VOC......................        93.34        63.62         0.00
Refueling VOC....................        53.33        53.33        0.00 
------------------------------------------------------------------------
Nonexhaust VOC...................       559.31       492.07         0.00
Exhaust VOC......................       907.00       907.00      1341.00
    Total VOC....................      1306.48      1215.10      1341.00
NOX..............................      1340.00      1340.00      1540.00
Running loss benzene.............         3.75         3.36         0.00
Hot soak benzene.................         0.96         0.93         0.00
Diurnal benzene..................         0.97         0.66         0.00
Refueling benzene................         0.56         0.56        0.00 
------------------------------------------------------------------------
Nonexhaust toxics................         6.24         5.51         0.00
Exhaust benzene..................        53.54        53.54        77.62
Acetaldehyde.....................         4.44         4.44         7.25
Formaldehyde.....................         9.70         9.70        15.34
1,3-butadiene....................         9.38         9.38        15.84
POM..............................         3.04         3.04         4.50
                                                                        
------------------------------------------------------------------------
Exhaust toxics...................        80.10        80.10       120.55
    Total toxics.................        86.34        85.61      120.55 
------------------------------------------------------------------------

Exhaust Emissions Model

1. Data Sources
    The relationship between fuel properties and exhaust emissions is 
complex and the theory behind such relationships continues to be 
developed. As a result, EPA has asked industry, state regulatory 
agencies, and other organizations with relevant test data to make their 
data available to the Agency to ensure that this rule is based on as 
much relevant information as possible. The complex model described in 
the following section is based on data generated from a number of 
exhaust emissions testing programs. These programs, their design 
intent, and their limitations are discussed in Section IV.A of the RIA. 
Data from these programs were excluded from EPA's analysis if the data 
were not based on a valid FTP measurement cycle, if the vehicle in 
question did not employ 1990-equivalent emission control technology, if 
the vehicles did not exhibit stable, repeatable emissions performance, 
or if the data were clearly inconsistent with the bulk of the data 
available to EPA (based on statistical considerations). In addition, 
data from programs that did not measure nonmethane hydrocarbon 
emissions were not used to develop EPA's exhaust VOC complex model. The 
Agency believes its analysis considered all valid, and relevant data on 
the exhaust emissions effect of fuel modifications when used in 1990 
model year and equivalent vehicles that was available at the time the 
model was developed.
2. Analysis Method
    Exhaust emissions are affected by both vehicle and fuel 
characteristics. Since the test programs described above generally 
involved different vehicles, different fuels, and in some cases 
different test procedures, the analysis required to determine the 
relationship between fuel properties and emissions is complex. However, 
EPA believes that the methods used to develop the complex model 
considers and addresses these complexities appropriately. EPA utilized 
statistical analysis techniques to isolate the effects of fuel 
modifications on exhaust emissions of VOC, NOX, and toxics from 
other factors affecting exhaust emissions.
    At a series of six public workshops held over the past two years, 
the Agency presented its views on data sources, analysis methods, and 
preliminary emissions models for public review and comment. The Agency 
also requested other organizations to share their data, analysis 
expertise, and emissions models at these workshops. The methods used to 
develop the model promulgated today appropriately incorporate the 
comments and suggestions regarding the analysis process received at the 
workshops, as well as other comments and suggestions received from 
industry, state and federal government authorities, and other 
interested parties during the course of this rulemaking. Information 
regarding the workshops, public comments and suggestions, and EPA's 
analysis methods can be found in Docket A-92-12. The approach chosen by 
EPA to analyze the available data is summarized below and is discussed 
more fully in Section IV.A of the RIA.
    Since the vehicle and the fuel both affect exhaust emissions, EPA's 
analysis separated exhaust emissions into fuel components and vehicle 
components. In all test programs analyzed by EPA, the single most 
significant determinant of the level of emissions from a given vehicle 
on a given fuel was the vehicle itself. Fuel properties exert a much 
smaller influence on exhaust emissions than do vehicle characteristics 
such as emission control system technology, vehicle mileage, catalyst 
efficiency, oxygen sensor efficiency, engine size, engine design, 
vehicle size, fuel efficiency, vehicle maintenance, etc. To identify 
the effects of fuel property modifications on emissions, EPA found it 
necessary to identify the effect of each vehicle on emissions and 
separate this effect from the fuel effects. For vehicles used in more 
than one test program, EPA found it necessary to determine the vehicle 
effect separately for each test program since vehicle effects were 
observed to change between studies.
    The fuel components of exhaust emissions were separated into two 
main categories. The first category consisted of the effects of 
individual fuel parameters. For example, the effect of sulfur on 
NOX emissions was best modeled by a relationship containing a 
linear sulfur term (of the form c1S, where c1 is a constant 
and S is the sulfur level) and a second-order sulfur term (of the form 
c2S2, where c2 is a constant). The second category of 
fuel terms consisted of interactive effects between two fuel 
parameters. For example, EPA's analysis found that the effect of 
aromatics on hydrocarbon emissions is related to the E300 level of the 
fuel. This effect cannot be represented as an aromatics or E300 effect 
alone but must be represented as an interactive term of the form 
c3AE, where c3 is a constant, A is the aromatics level, and E 
is the E300 level.
    In the February 1993 proposal, EPA indicated that it planned to 
make several changes to the method used to develop the complex model. 
As discussed in that proposal and in the RIA, fuels can be 
characterized in terms of a number of different sets of fuel 
parameters. EPA used the results of individual fuel studies and its 
public workshops to select the set of fuel parameters used to model 
exhaust emissions in its February 1993 proposal. At that time, the 
Agency indicated that it might alter its choice of parameters to 
represent gasoline distillation characteristics from a temperature 
basis (using T50 and T90) to a percent evaporated basis (using E200 and 
E300, the percentage of the fuel's volume that evaporates when heated 
to 200 deg.F and 300 deg.F, respectively). For reasons outlined in the 
February 1993 NPRM and section IV.A of the RIA, EPA has chosen to make 
this change and has converted its exhaust emission models to a percent 
evaporated basis since the NPRM was issued, removing the T50 and T90 
terms from its models in the process. The Auto/Oil Heavy Hydrocarbon 
and EPA Phase II Reformulated Gasoline Test Program studies have been 
added to the complex model database. Finally, EPA has changed the 
confidence level required to permit terms to remain in the model to 90 
percent, in keeping with the approach used in developing the simple 
model. The Agency was not able to determine the influence of the type 
of aromatic compounds in fuels, specifically heavy aromatics, on 
exhaust emissions, and hence such terms have not been included in the 
complex model at this time.
    Because vehicles can have different emission control systems, the 
Agency anticipated that fuel modifications would have different 
emission effects on different types of cars. To account for these 
differences, EPA's February 1993 proposal divided vehicles into two 
``emitter classes'' (normal and higher emitters) based on their exhaust 
emission levels. EPA then subdivided vehicles in each emitter class 
into ``technology groups'' based on the emission control technology 
with which each vehicle was equipped. However, as discussed in the 
NPRM, EPA was concerned that technology group distinctions among higher 
emitters might not be appropriate, since such vehicles' high level of 
emissions indicated that their emission control systems were not 
functioning properly. In addition, the limited quantity of data for 
higher emitters made it difficult to identify genuine differences in 
emissions response between higher emitters of different technology 
groups. Many commenters expressed similar concerns. Hence the model 
promulgated today does not divide higher emitters into technology group 
categories but retains such distinctions when analyzing normal 
emitters. In response to numerous comments, EPA attempted to reduce the 
number of normal emitter technology groups. However, as discussed in 
section IV.A of the RIA, EPA was unable to identify an appropriate 
basis for consolidation. EPA considers its retention of emitter class 
and technology group distinctions to be justified by the presence of 
statistically significant fuel effects specific to individual emitter 
classes and technology groups in today's complex model.
    At the same time, EPA recognized the validity of comments received 
from a number of sources that (1) many emission effects were likely to 
be consistent across multiple technology groups or across emitter 
classes, and (2) insufficient data were available to model many 
potential terms, particularly interactive terms. The approach used by 
EPA to construct the complex model proposed in February 1993 did not 
incorporate these legitimate concerns. To do so, EPA has utilized a 
modified version of the ``unified'' approach advocated by API and other 
commenters (as described in the RIA) to develop today's complex model. 
This modeling approach, the statistical criteria used by EPA in 
conjunction with this approach, and the techniques used to simplify the 
models are discussed in detail in section IV.A of the RIA and are 
summarized below.
    First, interactive terms were permitted to enter the models only 
when sufficient data were available. The model proposed in the February 
1993 NPRM permitted all interactive terms to enter the models, 
regardless of whether sufficient data were available to estimate such 
an effect, and it did not apply statistical criteria to evaluate 
whether terms added to the model introduced more risk of inaccuracy in 
the model than they removed.
    Second, preliminary models for higher emitting vehicles were 
constructed based solely on data from such vehicles. Only those terms 
that satisfied EPA's statistical criteria (discussed at length in the 
RIA) were retained. These criteria included measures to balance 
overfitting (introducing too many terms to explain the observed data) 
and underfitting (not including terms necessary to explain the observed 
data). The NPRM model did not include measures to prevent overfitting.
    Third, the entire database was analyzed using the unified approach. 
The effects of each term on emissions was divided into two parts: an 
average effect across all vehicles, and a series of adjustment terms 
for each technology group and for higher emitters. Only those terms 
that satisfied EPA's statistical criteria were retained, with two 
exceptions. Higher emitter adjustment terms were retained regardless of 
statistical significance since they had been found to be statistically 
significant when examining the higher emitter data separately. EPA was 
concerned that failure to do so might cause genuine higher emitter 
effects to be ``washed out'' by the greater number of data for normal 
emitters. In addition, some overall terms were retained for hierarchy 
reasons despite low statistical significance. For example, a linear 
term for a given fuel parameter (e.g., E300) might not be significant 
while a squared term for the same parameter (e.g., E300\2\) might be 
significant. Since the mathematical form of the squared terms includes 
the corresponding linear effects, the linear term would be retained 
regardless of significance to preserve the model's hierarchical 
structure. The importance of hierarchy was emphasized by a number of 
workshop participants and commenters, as discussed in the RIA. The NPRM 
model included separate terms for each technology group and emitter 
class and hence did not include terms to represent the average effect 
of a fuel parameter across all vehicles. The NPRM model also did not 
incorporate hierarchy considerations.
    Fourth, outlying and overly influential data were dropped from the 
database and the model was re-estimated based on the remaining data. 
Outlying data consist of observations that differ from the average 
observed effect by so large a margin that they are more likely to 
represent observational error, reporting error, or other measurement 
artifacts than genuine phenomena. Outlying data can obscure genuine 
emissions effects. Influential data consist of observations that by 
themselves materially affect the resulting model, i.e., the model would 
differ materially if they were excluded. In a database the size of the 
Complex Model database, individual data points should not have such 
unusually large effects. Excluding outlying and influential 
observations is standard statistical practice. The NPRM model did not 
exclude either type of observation.
    Fifth, terms were deleted from the resulting model to avoid 
overfitting and collinearity problems. Overfitting occurs when so many 
terms are included in a regression model that the expected error due to 
the erroneous inclusion of a term exceeds the expected error due to not 
including the term. Collinearity problems occur when the fuel 
parameters included in the model are correlated with one another in the 
fuels tested. For example, the addition of oxygenate to gasoline causes 
E200 to increase. The oxygenate-containing fuels in the complex model 
database tend to have higher E200 values than fuels without oxygenate. 
In a sense, one can predict the E200 value of a fuel by knowing its 
oxygen content. Hence these two parameters would be considered to be 
highly collinear. Since regression models are developed under the 
assumption that terms are not collinear, the presence of strong 
collinearities can introduce error into the regression. Today's complex 
model takes both collinearity and overfitting into account by using a 
standard statistical criterion called Mallow's Cp criterion to 
remove terms which introduce large overfitting and collinearity 
problems. This approach resulted in a simpler, more reasonable, and 
statistically more sound model than had been proposed in the February 
1993 NPRM. It should be noted that high emitter terms forced into the 
model earlier in the process could be dropped at this stage of the 
analysis. Measures were taken to limit collinearity problems in the 
NPRM model, but overfitting concerns and the Cp criterion were not 
addressed.
    Sixth, the contribution of each remaining term to the model's 
explanatory power was estimated, and those terms whose contribution 
summed to less than one percent were deleted (i.e., the retained terms 
accounted for 99 percent of the explanatory power of the model) to 
simplify the form of the model without materially reducing its ability 
to predict the emissions impact of fuel modifications. This step was 
not taken during development of the NPRM model.
    Finally, the resulting models for each technology group within the 
set of normal emitting vehicles were consolidated into a single 
equation using a random balance approximation. The details of that 
approximation are given in Section IV.A of the RIA. This step was not 
taken during development of the NPRM model.
    The results of EPA's modeling efforts confirms the importance of 
technology group and emitter class distinctions, as can be seen by 
examining the differences in the exhaust emission equations for 
specific normal emitter technology groups or for normal and higher 
emitter class categories (as discussed in greater detail in the RIA). 
Efforts to reduce the number of technology group categories for normal 
emitters were not successful. Efforts to subdivide higher emitters by 
their emission characteristics such as exhaust hydrocarbon to NOX 
ratio did not improve the quality of EPA's higher emitter model. 
However, as discussed above, EPA found it unnecessary to separate 
higher emitters by technology group. This modification reflects EPA's 
belief, supported by preliminary field information, that one or more 
emission control components on higher emitters tend to be 
malfunctioning, which renders a classification scheme based on vehicle 
equipment questionable.
3. Exhaust Model
    As was discussed in the April 1992 and February 1993 proposals, the 
weight assigned to each technology group or emitter class for modeling 
purposes was set equal to its contribution to in-use emissions for each 
pollutant. The weight assigned to each emitter class was set equal to 
its projected contribution to in-use emissions. The weighting factor 
assigned to normal emitters was then broken down further by technology 
group, again according to their projected contribution to in-use 
emissions. These estimates and projections are essentially unchanged 
from the February 1993 proposal, although minor changes have been made 
to reflect more complete information about the fraction of 1990 sales 
accounted for by each technology group. The rationale for, derivation 
of, and renormalization of the weighting factors themselves are 
discussed in more detail in the RIA.
    Various commenters indicated that they considered EPA's previously 
proposed models were too complex. In response, the Agency has modified 
its analysis method in several ways. The resulting method, described in 
Section IV.B.2, results in exhaust emission models containing two 
equations for each pollutant instead of as many as sixteen separate 
equations, as was the case for the model proposed in February 1993. 
Each equation also has far fewer terms than the February 1993 
equations. However, EPA does not believe that today's less complicated 
complex model is less accurate than the complex models presented at 
public workshops or in the February proposal. This belief is based on 
the models' comparable explanatory power (as reflected in their similar 
R\2\) and the superior accuracy of today's model in accounting for the 
emission effects seen in the vehicle testing programs that comprise the 
complex model database. Today's VOC and NOX models are based on 
the most accurate of the three sets of models included in EPA's July 
14, 1993 docket submittal, while also taking into account relevant 
comments regarding specific aspects of the models. Today's toxics 
models are a further simplification of the models included in the July 
1993 docket submittal in response to comments received by EPA on its 
docket submittal. These points are discussed more fully in Section IV.A 
of the RIA.
    The specific equations that comprise the complex model can be found 
in section 80.45 of the regulations for this rule. Their derivation is 
discussed in detail in Section IV.A of the RIA. The range of parameter 
values for which these equations are valid is discussed in Section D 
and in Section IV.D of the RIA. As discussed in Section V, refiners are 
required to submit data to augment the model if they wish to certify 
fuels with properties that fall outside this range as reformulated 
gasolines.

 C. Nonexhaust Model

    Nonexhaust emissions are less strongly affected by vehicle design 
and are influenced by fewer fuel characteristics than are exhaust 
emissions. In addition, the theoretical principles involved in 
nonexhaust emissions (which include evaporative, running loss, and 
refueling emissions) are better understood, and nonexhaust emission 
control technologies are more consistent across vehicles, than are 
exhaust emissions and emission control technologies. Since the 
relationship between fuel properties and nonexhaust emissions is less 
complex and better understood than for exhaust emissions, there was 
much less need for EPA to generate additional data to evaluate 
nonexhaust emissions than was the case for exhaust emissions. EPA was 
able to base its nonexhaust VOC emission model on data generated from 
EPA's ongoing nonexhaust emissions testing program that has been used 
to develop EPA's MOBILE emission inventory models, specifically the 
MOBILE4.1 and MOBILE5.0A models. EPA believes this data to be 
sufficient to model the relationship between fuel properties and 
nonexhaust VOC emissions for the purposes of this rule. Additional 
information about MOBIL4.1 and MOBILE5.0A can be found in Dockets A-91-
02 and A-92-12.
    EPA is in the process of developing an enhanced model of nonexhaust 
VOC emissions, based on a more complete set of theoretical principles 
and additional test data, that is expected to be more accurate and more 
widely applicable to oxygenated fuels than the MOBILE models. A 
preliminary version of this model was discussed at a public workshop 
held on August 25, 1992, and materials related to this model have been 
placed in the docket for this rulemaking. At this time, however, this 
enhanced nonexhaust VOC emissions model is not complete and hence is 
not incorporated in today's complex model.
    The nonexhaust VOC model in today's complex model is based on 
correlations between RVP and nonexhaust VOC emissions derived from the 
July 11, 1991 version of MOBILE4.1 for Phase I of the reformulated 
gasoline program (1995-1999) and from MOBILE5A for Phase II (2000 and 
beyond). This approach is consistent with the definition of baseline 
emissions set forth in Section IV.A and is based on the same 
considerations outlined in that section.
    To develop the correlations shown below, the MOBILE models were 
used with temperatures of 69 to 94 degrees Fahrenheit for Class B areas 
and 72 to 92 degrees Fahrenheit for Class C areas. As discussed in 
Section IV.A, a basic inspection and maintenance program was assumed 
for Phase I while an enhanced I/M program was assumed for Phase II. In 
addition, the presence of Stage II evaporative emissions recovery 
systems with an overall vapor recovery efficiency of 86 percent was 
assumed (as discussed in the SNPRM and NPRM). EPA is in the process of 
promulgating requirements for onboard refueling emission controls which 
may be more effective at controlling refueling emissions than Stage II 
vapor recovery systems. However, these requirements did not apply to 
1990 model year vehicles and hence cannot be incorporated into the 
model for certification purposes. In addition, EPA has chosen not to 
incorporate the effects of onboard refueling controls in its evaluation 
of the effects of reformulated fuels on emissions from the entire in-
use vehicle fleet, which includes vehicles from a number of different 
model years. This decision was made for several reasons. First, 
requirements for onboard refueling controls have not yet been 
finalized, making evaluation of their impact on in-use emissions 
difficult. Second, onboard refueling controls are not expected to be 
required on all new vehicles until 2000 and are not expected to be 
present on the bulk of in-use vehicles for several years after that 
time. Third, while onboard controls are expected to be more efficient 
at controlling refueling emissions than Stage II controls, the 
difference is not expected to be large in areas affected by the 
reformulated gasoline program and will affect only a small portion of 
total nonexhaust VOC emissions. Since EPA's analysis of the additional 
benefits of onboard vapor recovery controls is not yet available, and 
since such benefits are expected to be small relative to overall 
emissions, EPA has chosen to retain its assumptions regarding Stage II 
vapor recovery in forecasting the effects of fuel modifications on 
nonexhaust VOC emissions from the in-use vehicle fleet.
    The only toxic air pollutant covered by the reformulated gasoline 
program that is found in nonexhaust emissions is benzene, which is a 
natural component of gasoline. The other four toxic air pollutants 
listed in section 211(k) are solely products of fuel combustion and 
hence are not found nonexhaust emissions. As discussed in the SNPRM, 
the Agency's correlation between fuel benzene content and summer non-
exhaust benzene emissions is based on results from General Motors' 
proprietary model of tank vapors, as confirmed independently by EPA-
generated data using a number of fuels. Both the derivation and 
verification of the non-exhaust benzene emissions model are discussed 
more fully in the RIA. The nonexhaust benzene emission model also 
depends on the RVP of the fuel, as is the case for the nonexhaust VOC 
emission model. The derivation of the nonexhaust benzene and VOC models 
is discussed more fully in the RIA.

D. Range/Extrapolation

    Like all regression models, the complex model is not valid for all 
possible input values. The range of fuel parameter values over which 
the complex model accurately predicts vehicle emissions is given in 
Table IV-3. These ranges are based on the range of data used to develop 
the models and on comments received by the Agency on this issue. The 
limits proposed in the February 1993 were, in some cases, narrower than 
the range of data used to develop the complex model. In addition, the 
limits proposed in the NPRM would have prevented a number of very low 
emitting fuels from being certified using the model. 

 Table IV-3.--Parameter Ranges for Which the Complex Model Can Be Used  
------------------------------------------------------------------------
                                                   Valid range for:     
                                             ---------------------------
               Fuel Parameter                 Reformulated  Conventional
                                                  fuel          fuel    
------------------------------------------------------------------------
Aromatics, vol %............................     0-50          0-55     
E200, %.....................................    30-70         30-70     
E300, %.....................................   70-100        70-100     
Olefins, vol %..............................     0-25          0-30     
Oxygen, vol %...............................    0-3.7         0-3.7     
RVP, psi....................................   6.4-10        6.4-11     
Sulfur, ppm.................................    0-500        0-1000     
Benzene, vol %..............................    0-2.0        0-4.9      
------------------------------------------------------------------------

    EPA has received a number of comments requesting alterations in the 
model's range. After considering these comments and re-evaluating the 
data on which the complex model is based, EPA has modified the range 
limits. In some cases, EPA has chosen to extrapolate the complex model 
slightly beyond the range for which data were available in order to 
allow additional fuels, both conventional and reformulated, to be 
evaluated using the model without recourse to expensive and time-
consuming vehicle testing. These extrapolations are limited to those 
parameters whose effects appear to be well-characterized by the complex 
model. A detailed discussion of the limits of the available data, EPA's 
rationale for extending the valid range of the model for some 
parameters, and the extrapolation method used to extend the model can 
be found in Section IV.D of the RIA.

E. Winter

    While the VOC performance standard for reformulated fuels applies 
only in the summer, the toxics and no-NOx-increase requirements 
apply year-round. EPA therefore recognized the need to model the 
exhaust toxics and NOx emissions performance of reformulated 
gasolines during the winter months as well as during the high ozone 
season. Modeling winter emissions performance, however, presented a 
number of difficulties. First, the data sources described earlier 
provided data on emissions performance only under summer conditions and 
for gasolines with RVP levels typical of summer gasolines. Second, the 
RVP levels of fuels included in the complex model database ranged from 
7 to 10 psi, while winter fuels tend to have RVP levels in the 11.5 psi 
range and are not restricted by other regulations. Hence the complex 
model cannot be used directly for fuels with typical winter RVP levels.
    RVP's impact on canister loading and subsequent purging is thought 
to be the primary cause of its effects on exhaust emissions. Since data 
do not exist on the effects of winter fuels on canister loading under 
winter conditions, the Agency is not able at this time to model the 
effects of winter RVP levels on exhaust emissions. To avoid making 
unsound or speculative predictions, EPA proposed and is now 
promulgating a requirement that for purposes of evaluating emissions 
effects using the complex model, the RVP of winter fuels be set at the 
summer statutory baseline RVP value. In effect, this requirement builds 
into the model the assumption that the RVP level of winter gasolines 
has no effect on NOx or exhaust toxics emissions. As a result, 
refiners will not be required to alter the RVP levels of winter 
gasolines. Refiners will receive neither benefit nor penalty for 
changing the RVP of their winter gasolines. To evaluate winter fuels 
using the complex model, an RVP value equal to that of summer baseline 
gasoline (8.7 psi) must be used instead of the fuel's actual RVP. Doing 
so effectively removes the contribution of RVP to winter exhaust 
emissions.
    When sufficient data is developed on the emissions impact of winter 
RVP levels under winter ambient conditions, EPA will be able to revise 
the complex model accordingly. Until then, EPA believes it is more 
appropriate to assume that RVP levels have winter exhaust emission 
effects than to speculate about the magnitude of such impacts.
    In its prior proposals, EPA had proposed that winter nonexhaust 
emissions, including winter nonexhaust benzene emissions, be considered 
zero. EPA received a number of comments requesting that both baseline 
emissions and the nonexhaust toxics model include winter nonexhaust 
benzene emissions. This request was based on the belief that the year-
round benzene limits would result in reduced nonexhaust benzene 
emissions in the winter months. EPA has evaluated this claim, taking 
into account temperature ranges and the effects of inspection and 
maintenance programs on such emissions. EPA acknowledges the validity 
of this claim, since winter nonexhaust emissions, including nonexhaust 
benzene emissions, are likely to be nonzero under all winter 
temperature ranges. In the past, the lack of sufficient data on 
nonexhaust emissions under winter temperature conditions has prevented 
EPA from developing reliable, accurate models of winter nonexhaust 
emissions. The commenters provided a limited quantity of data on winter 
nonexhaust emissions to support their claim. However, the data 
submitted in support of this claim were based on measurements of 
nonexhaust emissions from vehicles with very low nonexhaust emissions. 
EPA's analysis indicates that these vehicles are not representative of 
in-use vehicles. In addition, the chemical composition of the measured 
nonexhaust emissions were characteristic of resting losses (losses that 
occur due to permeation through fuel system components) rather than of 
diurnal, hot soak, or running loss emissions. Resting losses are not 
included in EPA's baseline emission estimates, so EPA does not consider 
it appropriate to include resting losses in its nonexhaust emission 
models. Finally, no data were submitted on nonexhaust benzene emissions 
from fail vehicles under winter conditions. Since nonexhaust benzene 
emissions from such vehicles will comprise a significant portion of 
winter nonexhaust benzene emissions, EPA is concerned that a model 
based on the submitted data would not provide accurate estimates of 
such emissions. Given the theoretical merits of the claim, however, EPA 
will consider including a model of winter benzene nonexhaust emissions 
in the complex model in the future when sufficient data become 
available.

F. Fungibility

    EPA has long recognized the importance of maintaining a fungible 
fuel system, in which complying gasolines can be mixed freely without 
resulting in mixtures that do not themselves comply with regulatory 
requirements. Fungibility is essential to smooth, cost-effective 
operation of fuel distribution systems such as pipelines. The Agency 
has received numerous comments on the need to maintain fungibility. At 
the same time, the Agency considers it essential that gasolines 
certified as reformulated meet all required emission performance levels 
in the field. In cases where the effects of a given fuel parameter on 
emissions are non-linear, it is possible for two complying fuels to 
produce a non-complying fuel when mixed.
    The complex model contains a number of nonlinear terms, which 
introduces the possibility that gasolines which comply with this rule's 
requirements in isolation would not comply if mixed with other 
complying fuels. EPA has been concerned with this possibility and has 
undertaken extensive analyses to determine its likelihood and to 
develop methods to cope with its occurrence. EPA's analyses, which have 
utilized methods that have been supported by a number of organizations, 
indicate that the complex model promulgated in today's rule will not 
create fungibility problems despite its inclusion of nonlinear terms. 
This analysis is explained in greater detail in Section IV.F of the 
RIA.

G. Future Model Revisions

    The complex model promulgated in this rulemaking reflects EPA's 
best understanding of the relationship between fuel characteristics and 
vehicle emissions. However, EPA expects future research to clarify this 
relationship. EPA also recognizes that changes in in-use vehicle 
emission control programs (e.g., I/M programs) will continue to occur 
and that these changes may alter the relationship between fuel 
characteristics and in-use emissions. In addition, the Agency is 
concerned that augmentations to the model through vehicle testing 
(Section V) may, over time, accumulate to the point that a revised 
complex model, incorporating the current complex model database and all 
relevant information gathered since then, would be beneficial. As 
discussed in Section V, EPA plans to issue revised complex models when 
the Agency deems that sufficient new information is available to 
warrant such action. Model revisions will be developed through a formal 
rulemaking process.

H. Complex Model Performance of Simple Model Fuels

    Fuels qualifying as reformulated under the simple model must meet 
specified benzene, oxygen, and RVP requirements while also satisfying 
the toxics performance standard. The RVP requirement differs between 
VOC control regions, and the requirements and standards also vary 
depending on whether compliance is being achieved on a per-gallon or 
averaging basis. In addition, levels of other fuel parameters are only 
specified under the simple model in terms of deviations from each 
refiner's baseline fuel. Evaluating the performance of simple model 
fuels under the complex model is difficult since fuel properties can 
vary widely.
    However, it is possible to evaluate a set of fuels that are 
representative of expected, typical simple model fuels. EPA expects 
most refiners to pursue compliance on average (for all or part of their 
product slate) in order to maximize flexibility in day-to-day refinery 
operations and recoup compliance margins. Given present and projected 
conditions, EPA also expects that MTBE and ethanol will be the most 
commonly used oxygenates during Phase I of the reformulated gasoline 
program. The fuels specified in Tables IV-4 and IV-5 below include 
fuels designed to meet the requirements of the simple model in both VOC 
control regions and using both oxygenates. The level of olefins, 
sulfur, E200, and E300 have been set to Clean Air Act baseline levels, 
while the level of aromatics has been set at the level necessary to 
comply with the toxics requirements of the simple model. Aromatics 
levels were assumed to be the same for summer and winter fuels.

           Table IV-4.--Typical Simple Model Fuels Using MTBE           
                            [Under Averaging]                           
------------------------------------------------------------------------
                                           Fuel                         
                 -------------------------------------------------------
                        1             2             3             4     
------------------------------------------------------------------------
Fuel                                                                    
 Description:                                                           
  Season........  Summer......  Summer......  Winter......  Winter      
  VOC Control     1...........  2...........  1...........  2           
   Region.                                                              
  Fuel                                                                  
   Parameter:.                                                          
  RVP, psi......  7.1.........  8.0.........  N/A.........  N/A         
  Oxygen, wt%...  2.1.........  2.1.........  2.1.........  2.1         
  Benzene, vol%.  0.95........  0.95........  0.95........  0.95        
  Aromatics,      27.5........  26.3........  27.5........  26.3        
   vol%.                                                                
  Olefins, vol%.  9.2.........  9.2.........  11.9........  11.9        
  E200, %.......  41..........  41..........  50..........  50          
  E300, %.......  83..........  83..........  83..........  83          
  Sulfur, ppm...  339.........  339.........  338.........  338         
------------------------------------------------------------------------


          Table IV-5.--Typical Simple Model Fuels Using Ethanol         
                            [Under Averaging]                           
------------------------------------------------------------------------
                                           Fuel                         
                 -------------------------------------------------------
                        5             6             7             8     
------------------------------------------------------------------------
Fuel                                                                    
 Description:                                                           
  Season........  Summer......  Summer......  Winter......  Winter      
  VOC Control     1...........  2...........  1...........  2           
   Region.                                                              
  Fuel                                                                  
   Parameter:.                                                          
  RVP, psi......  7.1.........  8.0.........  N/A.........  N/A         
  Oxygen, wt%...  2.1.........  2.1.........  2.1.........  2.1         
  Benzene, vol%.  0.95........  0.95........  0.95........  0.95        
  Aromatics,      25.5........  24.3........  25.5........  24.3        
   vol%.                                                                
  Olefins, vol%.  9.2.........  9.2.........  11.9........  11.9        
  E200, %.......  41..........  41..........  50..........  41          
  E300, %.......  83..........  83..........  83..........  83          
  Sulfur, ppm...  339.........  339.........  338.........  338         
------------------------------------------------------------------------

    The performance of these fuels according to the complex model 
(using the MOBILE4.1 baseline as previously discussed) is summarized in 
Table IV-6.

             Table IV-6.--Performance of Typical Simple Model Fuels Under the Phase I Complex Model             
                                              [Under Averaging]\1\                                              
----------------------------------------------------------------------------------------------------------------
                                                          Emission reduction versus CAAB fuel (percent)         
                                                ----------------------------------------------------------------
                      Fuel                                     Nonexhaust                                       
                                                 Exhaust VOC      VOC       Total VOC       NO X        Toxics  
----------------------------------------------------------------------------------------------------------------
1..............................................         7.92        51.42        36.57         1.46        27.33
2..............................................         5.35        23.93        17.11         1.28        24.57
3..............................................         0.33          N/A         0.33        -0.21        12.83
4..............................................         0.80         0.00         0.80         0.04        13.87
5..............................................         8.64        51.42        36.82         1.90        25.70
6..............................................         6.09        23.93        17.38         1.76        22.56
7..............................................         3.55          N/A         3.56         0.58        11.52
8..............................................         4.01          N/A         4.01         0.88       12.48 
----------------------------------------------------------------------------------------------------------------
\1\Performance of summer fuels (#s 1, 2, 5, 6) given relative to that of Clean Air Act summer baseline fuel.    
  Performance of winter fuels (#s 3, 4, 7, 8) given relative to that of the winter baseline fuel defined in     
  Section III.                                                                                                  

I. Phase I Performance Standards Under the Complex Model

    All fuels produced during Phase I of the reformulated gasoline 
program must meet the VOC, toxics, and NOX requirements of the 
Act. Fuels certified using the complex model in Phase I must show 
either no increase in NOX emissions from baseline levels on a per-
gallon basis as discussed in the February 1993 proposal or a 1.5% 
reduction from baseline levels on average as discussed in Section VII. 
In addition, as discussed in Section III.E., such fuels must result in 
either a 15% reduction in total toxics emissions from baseline levels 
on a per-gallon basis or a 16.5% reduction in total toxics emissions 
from baseline levels on average.
    With regard to the VOC standards, EPA considers fuels produced to 
meet the provisions of the simple model to be producible. Thus, as 
discussed in the February 1993 proposal, EPA believes it feasible to 
base the Phase I standards for VOC emissions on the performance of 
fuels that meet the Simple Model requirements, provided that this 
performance is more stringent than minimum performance required by the 
Act. EPA considers the fuels whose VOC performances were evaluated in 
Section IV.H to be representative of Simple Model fuels. Under the 
reformulated gasoline program, VOC emissions are controlled only during 
the high ozone season. For this reason, the VOC performance standard 
has been determined by the performance of the Phase I summer fuels 
presented in Section IV.H. Since these fuels achieve emissons 
reductions that equal or exceed the minimum requirements set forth in 
the Act, the VOC performance standard during Phase I for fuels 
certified under the complex model has been based on the performance of 
these fuels. Setting the VOC performance standards in 1998-1999 equal 
to this VOC performance level, which EPA believes to be a reasonable 
estimate of the average performance of fuels produced in 1995-1997, 
preserves the integrity of the two-phase program specified by Congress 
and is consistent with the Agreement in Principle signed in 1991.
    The summer VOC performance of ``typical'' high ozone season simple 
model reformulated gasolines according to the complex model is 
presented in Table IV-6. In VOC Control Region 1, the simple model fuel 
reduces VOC emissions by 36.6 percent for the MTBE-containing fuel 
(Fuel 1) and 36.8 percent for the ethanol-containing fuel (Fuel 5). 
Since the 1998 performance requirements in VOC Control Region 1 are to 
be based on the performance of typical simple model fuels, and since 
Fuels 1 and 5 both satisfy the simple model requirements and are 
considered by EPA to be representative of typical simple model fuels, 
EPA has set its 1998 performance standards in VOC Control Region 1 so 
as to permit both of these fuels to meet the 1998 performance 
standards. In addition, EPA considers Fuel 1 to be more representative 
of typical simple model fuels in VOC Control Region 1 since MTBE does 
not boost fuel RVP levels to the extent that ethanol does. As was 
discussed in the April 1992 and February 1993 proposals, EPA believes 
that per-gallon performance standard should be set 1.5 percentage 
points below the averaging performance standard. Hence high ozone 
season fuels certified using the complex model during Phase I of the 
reformulated gasoline program must provide a VOC emission reduction 
from baseline levels of 36.6 percent when complying on average and 35.1 
percent when complying on a per-gallon basis. Similarly, high ozone 
season fuels certified using the complex model during Phase I in VOC 
Control Region 2 must provide a VOC emission reduction from baseline 
levels of 17.1 percent when complying on average and 15.6 percent when 
complying on a per-gallon basis. These standards are summarized in 
Table IV-7 for both VOC control regions, under averaging and per-gallon 
compliance. Note that a negative performance standard signifies a 
reduction from baseline emission levels. 

 Table IV-7.--Reformulated Gasoline Performance Standards Relative to Clean Air Act Baseline Gasoline for 1998- 
                                                      1999                                                      
                                                    [Percent]                                                   
----------------------------------------------------------------------------------------------------------------
                                                       VOC control region 1            VOC control region 2     
                    Emission                     ---------------------------------------------------------------
                                                      Average       Per gallon        Average       Per gallon  
----------------------------------------------------------------------------------------------------------------
VOC.............................................           -36.6           -35.1           -17.1           -15.6
Toxics..........................................           -16.5           -15.0           -16.5           -15.0
NOX.............................................            -1.5             0.0            -1.5            0.0 
----------------------------------------------------------------------------------------------------------------

    In summary, the per-gallon and averaging VOC performance standards 
under the complex model during Phase I is set by the performance of the 
corresponding simple model fuel when evaluated using the complex model. 
The toxics performance standard is set at the statutory requirement of 
a 15 percent reduction from baseline levels for per-gallon compliance 
and a 16.5 percent reduction for compliance on average. Similarly, the 
NOX performance standard under the complex model during Phase I 
must satisfy the no NOx increase requirement on a per-gallon 
basis, or meet a 1.5% reduction for compliance on average.

V. Augmenting the Models Through Testing

    During the regulatory negotiation process, vehicle testing and 
emission modeling procedures for certifying that a gasoline complies 
with the NOX, toxics, and VOC requirements were discussed. 
Emission models such as the simple model described in Section III and 
the complex model described in Section IV offer several advantages over 
testing to determine emission effects. First, models can better reflect 
in-use emission effects since they can be based on the results of 
multiple test programs. Second, individual test programs may be 
intentionally or unintentionally biased due to vehicle selection, test 
design, and analysis methods. Third, fuel compositions tend to vary due 
in part to factors beyond the control of fuel suppliers such as 
variations in crude oil compositions and the inherent variability of 
refining processes. As a result, without one or more modeling options, 
each batch of fuel would have to be tested to ascertain its emission 
performance. Such levels of testing are neither desirable (because of 
the potential for intentional or unintentional bias in vehicle test 
programs) nor practical (because of the time and expense involved in 
vehicle testing). Fourth, models make more efficient use of scarce and 
expensive emission effects data than is possible otherwise. For these 
reasons, EPA believes that the modeling options outlined above are 
necessary for the reformulated gasoline program to achieve its 
environmental objectives and to minimize the costs of the program.
    These emission models, however, reflect currently-available 
information and hence do not allow refiners to take advantage of 
emission benefits derived from new fuel additives or changes in fuel 
parameters not contained in the models. To allow for fuel technology 
development and innovation, the Agency also believes that testing has a 
role in certification as a means of supplementing the models. This 
section contains a detailed discussion of the provisions EPA is 
promulgating regarding the conditions under which testing is permitted, 
the manner in which test results can be used to supplement the models, 
and the minimum requirements for vehicle testing programs. As was first 
outlined in the February 1993 NPRM, the vehicle testing process 
described in this section has undergone significant changes since it 
was first proposed in the April 1992 SNPRM. These changes have been 
made in response to changes in EPA's approach to modeling the 
relationship between fuel properties and emissions, as described in 
Section IV, and comments received in response to the April 1992 and 
February 1993 proposals. The following discussion addresses the major 
substantive comments received by EPA regarding certification of fuels 
by vehicle testing. A detailed summary and analysis of comments can be 
found in Section IV.G of the RIA.

A. Applicability of Testing

    Vehicle testing is the primary way that the effects of various 
gasoline formulations on motor vehicle emissions can be determined. As 
described above, data from vehicle testing programs forms the bulk of 
the basis for the simple and complex models.
    EPA believes that fuel certification through single test programs 
is inherently less reliable than certification through a testing-based 
model. The simple and complex models developed by EPA are based on a 
far greater amount of testing than would be available from any single 
test program. These models incorporate and balance the varying and 
conflicting results of numerous test programs. The statistical 
variation associated with an individual test program may cause a fuel 
to show emission effects during testing that would not occur in-use. 
Therefore, EPA proposes that testing only be permitted to augment the 
models for fuel effects that are not covered in the models.

B. Augmenting the Simple Model

    Due to the belief that fuels certified by vehicle testing should be 
evaluated in conjunction with the most complete emission model 
available to more accurately determine the emission benefits of the 
fuels being tested, EPA proposed that vehicle testing be permitted to 
augment the simple model only for the effect of oxygenates on NOx 
emissions beyond the simple model's oxygen caps. All other testing was 
to have been performed to augment the complex model. Based on data 
collected since the time of the proposal on the effect of oxygenates on 
NOx, EPA no longer believes it appropriate to augment the simple 
model even in the limited manner described above. Considerably more 
data are available in the complex model database regarding the effect 
of oxygenates on NOx emissions than would be provided by any 
individual test program. Therefore, testing can only be performed to 
augment the complex model. Fuels with oxygen concentrations in excess 
of 2.7 weight percent must be certified using the complex model.

C. Augmenting the Complex Model

    EPA believes that the objective of testing under the complex model 
should be to evaluate the emission effects of fuels whose emission 
effects cannot be adequately represented by the model. Such fuels would 
include fuels claiming emission effects from parameters not included in 
the complex model and fuels containing complex model parameters at 
levels beyond the range covered by the model. Without this constraint, 
it may be possible for a fuel producer to use the statistical variation 
associated with testing to claim emission effects through testing which 
would not be demonstrated in-use, when tested to a greater degree, or 
when modeled. For example, a fuel that would fail to meet the VOC 
requirement by a small margin when evaluated under the complex model 
could be tested and shown to meet the VOC requirement due to the 
testing error associated with any vehicle testing program. In addition, 
allowing testing of existing modeled parameters essentially would make 
the complex model, and the associated emission performance standards, a 
fluid target. Fuel producers would lose the certainty associated with a 
fixed model and the confidence that their capital investments will be 
useful for a fixed amount of time. Therefore, vehicle testing can be 
used only to determine the emission effects of parameters not 
adequately represented by the complex model. The emission effects of 
the fuel parameter in question will be determined by combining the 
emission effects determined through vehicle testing with the emission 
effects predicted by the complex model. Furthermore, each testing 
program can be used to identify the effects of only one new fuel 
parameter, unless the changes in other fuel parameters are a natural 
and inherent consequence of the primary fuel modification. Without this 
constraint, EPA believes that accurate determination of the effects of 
specific fuel parameters would be more difficult due to the inherent 
variability in testing programs and the increased opportunities for 
gaming.
    In addition, fuel suppliers opting to augment the complex model 
through vehicle testing must examine the extent to which emissions are 
affected when fuels certified with the augmented complex model are 
mixed with other fuels. The Agency is concerned with two potential 
problems when different fuels are combined. First, the emission effects 
of a parameter, as determined from vehicle testing, may not behave 
linearly as fuels with one level of the parameter are mixed with fuels 
with different levels of the same parameter. The degree to which this 
process occurs is referred to in this notice as the parameter's 
dilution effect. Dilution effects are evident in the complex model 
proposed in February 1993 and in the model being promulgated today. 
Second, the emission effects of various fuel parameters may be affected 
by the level of other fuel parameters. The degree to which this process 
occurs is referred to in this notice as an interactive effect. If such 
effects are present (as in the complex model proposed in February 1993 
and in the complex model being promulgated today), actual emission 
performance of the fuel mixture in-use could be worse than emission 
performance predicted from the complex model augmented by vehicle 
testing results. Therefore, the testing process must be structured so 
as to identify dilution and interactive effects.

D. Advance Approval of Test Programs

    Given the number of factors involved in designing a test program, 
the potential for inappropriate design is high. EPA wishes to avoid 
submittal of petitions based on test data from poorly designed programs 
in order to assure that the time and money invested in such programs is 
well-spent and to assure that all augmentations to the model are based 
on accurate data from well-designed test programs. Hence EPA will 
require petitioners to obtain advance approval from the Agency for 
their proposed vehicle testing programs. EPA will consider petitions to 
augment the model only if based on the results of approved testing 
programs. Furthermore, EPA retains the discretion to evaluate other 
data when evaluating petitions to augment the complex model and when 
determining the nature, extent, and limitations of the augmentation. 
This data may include the existing complex model database, additional 
vehicle testing programs, and other augmentation applications.
    Petitioners are required to include the following information when 
submitting a test program plan for approval: the fuel parameter to be 
evaluated for emission effects; the number and description of vehicles 
to be used in the test, including model year, model name, VIN number, 
mileage, emission performance, technology type, and vehicle 
manufacturer; the methods used to procure and prepare the vehicles for 
testing; the fuels to be used in the testing program, characterized as 
defined in Section V.I.5; the pollutants and emission categories to be 
evaluated; the methods and precautions to be used to ensure that the 
effects of the parameter in question are independent of the effects of 
other parameters already included in the complex model; a description 
of the quality assurance procedures to be used during the test program, 
and the identity and location of the organization performing the 
testing. EPA anticipates and encourages petitioners to submit the 
information listed above in stages beginning with the most general and 
ending with the most specific in order to streamline the approval 
process and eliminate wasted effort. EPA will work with petitioners to 
remedy unsatisfactory aspects of their proposed testing program.
    These provisions provide the Agency with greater assurance that 
petitioners would not selectively report test results to the Agency 
that support their petitions. Petitioners would still be able to 
``game'' the testing process by pre-screening vehicles to obtain a test 
fleet with the desired sensitivity to the proposed parameter. However, 
such a test fleet would have to be re-tested as part of the formal test 
program and hence would be subject to the variability inherent in 
vehicle testing, which would tend to reduce the gaming benefits from 
pre-screening. EPA believes that the risks and costs associated with 
re-testing will tend to dissuade petitioners from attempting to 
manipulate the testing process in this manner.
    EPA further requires that the results of all approved testing 
programs be submitted to the Agency, even if the parameter in question 
proves not to provide an emission benefit. The Agency believes this 
requirement is necessary to ensure that all available data is at the 
Agency's disposal when evaluating proposed augmentations to the complex 
model and when updating the model itself. EPA does not intend to use 
this provision to limit legitimate, innovative test programs. Rather, 
EPA is only interested in preventing the creation of artificial fuel 
parameters that claim to be the source of emission effects which are in 
reality only normal statistical variability.
    An example may help clarify the problems that can arise if testing 
is permitted for such artificial parameters. The level of C10+ 
aromatics (aromatics whose molecules contain ten or more carbon atoms) 
influences a fuel's E200, E300, and total aromatics levels. A testing 
program to identify the effects of C10+ aromatics may indicate that an 
emission effect from such compounds exists when the effect is actually 
due to differences in the fuels' E200, E300, and total aromatics levels 
or to the inherent statistical variability associated with vehicle 
testing. A petition for approval of a test program to identify the 
effects of C10+ aromatics would be required to identify specific 
measures to be taken to isolate the emission effects of C10+ aromatics 
from those of E200, E300 and total aromatics, all three of which are 
included in the complex model. In this example, EPA might require that 
certain test fuels contain identical levels of E200, E300, and total 
aromatics; that more rigorous statistical tests be used to identify 
genuine C10+ aromatics effects beyond those already incorporated in the 
complex model for E200, E300, and total aromatics; that the fuels used 
in the test program meet more detailed compositional criteria to ensure 
their representativeness; or that additional vehicles and/or fuels be 
tested. This provision helps assure that the effects observed in 
vehicle testing programs are genuine and will occur in-use.

E. Exclusive Rights to Augmentation

    EPA's April 1992 and February 1993 proposals discussed the 
advantages and disadvantages of providing a system of exclusive rights 
to model augmentations. EPA has given this matter further 
consideration, including consideration of comments regarding exclusive 
rights. The Agency has concluded that the reasons given in its April 
1992 proposal for not providing a system of exclusive rights are still 
valid. Hence the regulations governing augmentation of the complex 
model through vehicle regulation being promulgated today do not provide 
for exclusive rights to augmentations. Each augmentation will be 
available to any refiner desiring to utilize it, and no restrictions 
are provided under this rulemaking for exclusive rights, other than 
those granted under other legal code (e.g., patent law). The Agency 
does not believe adequate authority exists to promulgate exclusive 
rights provisions under this rulemaking. Furthermore, as discussed in 
the April 16, 1992 proposal, there are a number of reasons from 
economic, administrative, and air quality perspectives that make open 
use of model augmentations a desirable public policy.
    To allow interested parties to review and comment on a model 
augmentation, EPA will publish a description of the augmentation and 
its supporting data and information for public comment prior to 
approving an augmentation for use. In keeping with the provision of the 
Act, EPA will take into account any comments received, and act upon any 
request received for fuel certification through model augmentation 
within 180 days of such a request being completed.

F. Duration of Augmentation

    In its April 1992 proposal, EPA proposed that augmentations would 
remain in effect until the next subsequent complex model update was 
issued. EPA further proposed that if an augmentation had been valid for 
three or fewer years upon implementation of the subsequent update to 
the complex model, then refiners were permitted to continue using the 
augmentation in conjunction with the previous complex model for an 
additional length of time, subject to certain restrictions. EPA has 
received a number of comments on this proposal. Today's rule includes a 
set of limitations on the duration of the augmentation that incorporate 
some elements of these comments. These limitations are described below.
    The Agency is concerned that fuel suppliers not be allowed to claim 
emission effects in perpetuity based on the testing program described 
in this section due to the smaller degree of statistical confidence in 
such effects compared to those included in an updated complex model. 
The Agency also recognizes the need for fuel suppliers to recoup 
investments made to reformulate gasoline, including investments to 
utilize the emission effects identified through vehicle testing. 
Therefore, petitioners will be permitted to use emission effects 
determined through vehicle testing only for a limited period of time. 
In general, this period of time extends until an updated version of the 
complex model takes effect. Updates to the complex model will be issued 
by EPA through a formal rulemaking process at such time that the Agency 
determines that sufficient additional data has become available to 
warrant issuing such an update. Since some augmentations may be in 
place for a relatively short period of time before the model is 
updated, the Agency may not be able to adequately assess the 
augmentation. However, if a proposed update to the complex model is 
issued within three years of the time at which the augmentation takes 
effect, then fuel suppliers may be permitted to continue using the 
augmentation to determine the emission effects of reformulated 
gasolines. Specifically, if the Agency does not formally accept, 
reject, or modify the augmentation in question for inclusion in the 
updated complex model, then the augmentation will remain available 
until the next update to the model takes effect. If the Agency reviews 
the augmentation and either excludes the augmentation entirely or 
includes the augmentation in a modified form, then the augmentation 
will remain available for use in its original form, in conjunction with 
the complex model for which the augmentation was issued, to those fuel 
producers who can demonstrate to the Administrator's satisfaction that 
they have begun producing fuels that are certified using the 
augmentation. In such cases, the augmentation may continue to be used 
for five years from the date the augmentation took effect or for three 
years of fuel production, whichever is shorter.
    For the reasons discussed above, augmentations to the model for the 
effects of a given parameter over a particular range are permitted only 
once. Regardless of whether the emission effects of a parameter are 
included in an updated model, the augmentation can neither be used nor 
renewed (even with data from a second identical test program) once the 
maximum time period for use of a model augmented with the effects of 
that parameter has expired. Further testing is permitted, however, to 
provide EPA with the additional data needed to include the effect in a 
future update to the model.

G. Limits on the Range of an Augmentation

    Fuel suppliers will be permitted to claim the emission effects of 
augmentations only to the extent that the test program measured the 
effects of the fuel parameter in question over the range in question. 
If the parameter is included in the complex model, then the 
augmentation will be valid for fuels containing levels of the parameter 
between the level tested in the test program and the nearest limit of 
the complex model (as described in Section IV). If the parameter is not 
included in the complex model, then the augmentation will be valid for 
fuels containing levels of the parameter between the candidate and 
baseline levels (i.e., the levels found in Addition Fuels 1 and 3 in 
Table V.1). This provision is intended to be consistent with the limits 
on the application of the simple and complex models as expressed in 
Sections III and IV.

H. EPA Approval, Confirmatory Testing, and Fees

    In the process of reviewing a model augmentation, EPA must confirm 
the accuracy of the test results. To this end, EPA intends to monitor 
the petitioner's test program. The Agency also reserves the right to 
perform confirmatory testing to assure the validity of the test results 
and the emission performance of the reformulated fuel before allowing 
augmentation of the model. EPA further reserves the right to collect 
fees any lawful of an amount sufficient to recoup all costs associated 
with such confirmatory testing. EPA anticipates that if any 
confirmatory testing is performed that it will be of a limited nature 
and focused only on those aspects of the test program which are 
unexpected or contrary to prior test programs and engineering 
knowledge. Since EPA has not proposed methods to be used to calculate 
and collect such fees, these provisions will be handled through a 
subsequent rulemaking.

I. Test Requirements

1. Winter Testing
    To be certified as reformulated, a gasoline must meet the air 
toxics and NOX emission requirements year-round; the oxygen, 
benzene, and heavy metal content requirements year-round, and the VOC 
emission requirements in the high ozone season. As discussed in Section 
IV of this notice and Sections III and IV of the RIA, the Agency does 
not have sufficient data to model winter exhaust emissions. While 
differences between the effects of fuel parameters under summer and 
winter conditions beyond those discussed in Section IV may exist, the 
Agency does not have any evidence to date to suggest that they are 
significant. Therefore, EPA will apply the exhaust models developed for 
summer emissions to winter fuels as well for purposes of determining 
their air toxics and NOX emissions. The Agency is concerned that 
allowing winter testing for some fuel parameters while modeling the 
effects of other parameters based on summer emission data creates the 
possibility of ``gaming'' the testing process. Fuel suppliers could use 
the summer model to determine the effects of parameters that would 
behave unfavorably under winter conditions and use winter testing to 
determine the effects of parameters that would behave favorably under 
winter conditions. This possibility may result in fuels being certified 
for winter use (through a combination of winter testing and summer 
modeling) that result in smaller emission reductions in-use than are 
intended by the Act or than would occur by using the summer model. 
Therefore, EPA is at this time requiring that all testing be performed 
under summer ambient conditions. As the Agency gathers additional data 
in the future with which to revise the model, EPA will consider whether 
sufficient winter test data exists to permit the development of winter 
NOX and air toxics models. If such models can be developed, the 
Agency will consider whether to allow winter testing.
2. Pollutants to be Measured
    To the extent testing is performed to augment the complex model, it 
must be performed to determine the emission effects on all the 
pollutants covered by the reformulated gasoline certification 
requirements, including toxics (carbon monoxide and carbon dioxide 
emissions must also be measured to permit validation of test results). 
Failure to have such a requirement might result in important emission 
effects being overlooked and could allow fuel producers to ``game'' the 
certification requirements by permitting them to utilize the modeling 
option for one pollutant and the test results for another pollutant 
when it would be advantageous. The resulting certified reformulated 
gasolines may not meet all of the applicable emission reduction 
requirements in-use. For example, the model augmented by test results 
may indicate that a fuel meets the VOC requirement but fails the toxics 
requirement, while the model alone may indicate that the fuel meets the 
toxics requirement but fails the VOC requirement. Allowing the 
petitioner to claim the toxics emission effects predicted by the model 
while claiming VOC benefits determined through testing would ignore 
fuel effects on toxics that may not be addressed by the model.
    Testing costs would be significantly reduced if only VOC and 
NOX emissions were measured by testing, and toxics emissions were 
allowed to be modeled. However, since the testing option can only be 
used when the candidate fuel's parameters fall outside of the range of 
the model, EPA believes that adequate information seldom would be 
available to allow toxics emissions from such fuels to be modeled 
adequately if adequate information on VOC and NOX emissions were 
not available. If a fuel parameter is expected to affect VOC or 
NOX and is not covered by the model, toxics emissions may very 
well be affected and should be measured.
    It should be noted, however, measurement of toxics emissions for 
the fuels used to determine interactive effects (discussed below in 
section IV.I.4.) need not be performed. During development of the 
complex model, EPA found that interactive effects for air toxics are 
either statistically insignificant, impossible to discern given the 
accuracy and extent of available data, or too small to contribute 
substantially to the model's explanatory and predictive power. The 
complex model being promulgated today contains no interactive terms for 
air toxics emissions for these reasons, and hence EPA considers it 
unnecessary to require testing for interactive effects on air toxics. 
Specifically, toxics emissions need not be measured when testing 
additional Extension Fuels to determine interactive effects or when 
testing Addition Fuels 4, 5, 6, and 7, as described in Section V.I.5. 
However, EPA reserves the right to require that toxics be measured 
during vehicle testing programs when evidence exists that adverse 
interactive effects may exist for toxics. In particular, EPA reserves 
the right to require testing for interactive toxics effects if future 
revisions to the complex model include such effects.
    To better optimize the test program for the particular fuel 
parameter being evaluated, the Administrator may approve a request to 
waive certain pollutant measurement requirements contained in this 
section. Any such waiver would have to be obtained in advance of 
vehicle testing. A request for such a waiver must include an adequate 
justification for the requested change, including the rationale for the 
request and supporting data and information. Such a request must 
justify the reason that measurement of certain pollutants clearly is 
not necessary, and identify those pollutants for which additional 
testing may be warranted. For example, a petition might note that 
reducing the concentration of a specific high molecular weight aromatic 
decreased VOC emissions even though the overall concentration of 
similar aromatics remained unchanged. The petitioner may be able to 
justify a reduced need for toxics measurement based on the results of 
other studies which show that toxics are proportional to total 
aromatics rather than to individual aromatics species. In exchange, 
additional testing may be justified for VOC emissions to enable a 
greater degree of statistical confidence in the test results. As a 
result, the fuel supplier may be able to present EPA with sufficient 
justification to warrant increased testing for VOC emissions and 
decreased testing for toxics emissions.
3. Exhaust and Nonexhaust Testing
    VOC and air toxics emissions occur in both exhaust and nonexhaust 
emissions. However, EPA believes that the relationship between fuel 
characteristics and nonexhaust emissions is known with greater 
certainty and precision than the relationship between fuel 
characteristics and exhaust emissions. Nonexhaust emissions are a much 
simpler phenomenon to model than exhaust emissions. Nonexhaust 
emissions are driven primarily by well-understood principles of 
physical chemistry and are modified by devices such as charcoal 
canisters that are relatively easily modeled. Exhaust emissions, by 
contrast, involve combustion and catalysis reactions that are not as 
well understood theoretically and are much more difficult to model. In 
addition, exhaust emissions are estimated directly from the Federal 
Test Procedure (FTP) utilizing the Urban Dynamometer Driving Schedule, 
while nonexhaust emissions are estimated from both FTP and non-FTP test 
cycles in a complex process. Finally, data on nonexhaust emissions is 
much more extensive and internally consistent than data for exhaust 
emissions. For these reasons, EPA is restricting testing to augment the 
model to exhaust emission testing. Vehicle testing of nonexhaust 
emissions will not be accepted by EPA as the basis for augmentations to 
the nonexhaust emission model promulgated in today's rulemaking.
    EPA reserves the right to revise the nonexhaust emission model in 
the future to reflect new data acquired by the Agency, with such 
revisions taking effect after the start of Phase II of the program. In 
particular, either a new MOBILE model or ongoing research aimed at 
modeling nonexhaust emissions as a function of true vapor pressure over 
a range of temperatures may provide the basis for a revised nonexhaust 
model. The nonexhaust complex model being promulgated today relies on 
the Reid vapor pressure (RVP) to characterize fuels' nonexhaust 
emission characteristics. However, RVP is measured at a fixed fuel 
temperature (100  deg.F), while nonexhaust emissions occur over a wide 
range of fuel temperatures (80  deg.F to 130  deg.F). Since different 
oxygenates alter the relationship between RVP and true vapor pressure 
at a given temperature to different extents, EPA believes that a model 
based on true vapor pressure would be more accurate for fuels 
containing oxygenates than a model based solely on RVP.
    By permitting nonexhaust emissions from a given fuel to be 
estimated only from models and exhaust emissions to be estimated based 
in part on vehicle testing, EPA believes that the accuracy of fuel 
emission estimates will be enhanced. EPA also believes that this 
restriction will focus testing resources on those emission effects 
which the model predicts with the least degree of certainty (i.e., 
exhaust emissions), thereby improving the degree of certainty of 
emission predictions over the long run.
4. Eligibility of Fuel Properties for Testing
    In providing for augmentation of the complex model through vehicle 
testing, EPA's intent is to provide refiners with the ability to take 
advantage of new or ongoing research into the relationship between fuel 
properties and exhaust emissions. As discussed elsewhere in this 
section, however, the Agency believes that the complex model is more 
accurate and reliable than any single test program for the parameters 
included in the model.
    Therefore, augmentation by testing will be permitted only for 
certain fuel parameters and for certain levels of those parameters. 
Augmentations will not be permitted for fuel parameters that are 
included and quantified in the complex model database, regardless of 
whether they appear in the complex model itself. Such parameters were 
either not identified or identified and later rejected during the 
rulemaking process, which included a series of regulatory negotiation 
meetings, public workshops, and public meetings. EPA believes that the 
opportunities for error far exceed the potential emission benefits from 
allowing model augmentations using parameters that did not survive the 
peer review process.
    Augmentation through vehicle testing will be permitted to extend 
the valid range of the complex model for parameters already included in 
the model. The purpose of such testing would be to determine the 
behavior of the parameter within this extended range. Augmentations 
also will be permitted for parameters that neither have been included 
in today's complex model nor were measured for the fuels contained in 
the complex model database. The purpose of testing in this case would 
be to determine the behavior of new parameters, including any dilution 
and interactive effects. The test requirements differ for these two 
cases to reflect differences in existing knowledge and environmental 
risk.
5. Test Fuels
    The Agency has three major goals that must be satisfied before 
accepting an augmentation to the complex model. First, the augmentation 
must provide proper credit for fuel modifications. Second, the 
augmentation must account for dilution effects properly. Third, the 
augmentation must account for interactive effects between the parameter 
being tested and other fuel parameters properly. EPA believes that 
these three goals cannot be met without specifying at least some of the 
characteristics of fuels to be included in a test program. The 
remainder of this section describes the basic characteristics of the 
fuels required as part of a vehicle test program.
    a. Fuels required to extend the range of existing complex model 
parameters. Three ``extension fuels'' must be included in test programs 
intended to extend the range of the complex model for a given parameter 
to a more extreme level. Extension fuel #1 would contain the more 
extreme level of the parameter being extended in order to determine the 
parameter's effects on emissions at this more extreme level. Extension 
fuel #2 would contain the parameter being extended at levels at or near 
its current lower limit in the model. Extension fuel #3 would contain 
the parameter being extended at levels at or near its current upper 
limit in the model. These latter two fuels are necessary in order to 
estimate the size and significance of squared terms involving the 
parameter being extended. For all three fuels, the levels of other 
complex model parameters are to be set at the levels specified in Table 
V.2, which the Agency believes are representative of levels that will 
be found in typical reformulated fuels. In addition, all three fuels 
must be blended from representative refinery streams to the extent 
practicable. The three extension fuels must meet the requirements 
presented in Tables V.1 and V.2 to within the blending tolerances 
specified in Table V.4.
    If the Complex Model contains interactive effects between the 
parameter in question and other parameters, two additional fuels must 
be tested to quantify the magnitude of any such effect at extended 
levels of the parameter in question. For each interacting parameter, 
the two additional fuels would contain the parameter being tested at 
levels identical to that found in Extension Fuel #1. The interacting 
parameter would be present at the levels specified in Table V.1 for 
Extension Fuels 2 and 3, respectively, in the two additional fuels in 
order to quantify the size of the interactive effect over its full 
range. Other parameters would be set at the levels specified in Table 
V.2. It should be noted that since today's complex model includes only 
one interactive term (involving aromatics and E300), this situation 
would arise relatively infrequently.

 Table V.1.--Level of Existing Complex Model Parameters Being Extended  
------------------------------------------------------------------------
                                       Extension    Extension  Extension
   Fuel property being extended         fuel #       fuel #2    fuel #3 
------------------------------------------------------------------------
Sulfur, ppm........................  Extension           80        450  
                                      Level.                            
Benzene, vol%......................  Extension            0.5        1.5
                                      Level.                            
RVP, psi...........................  Extension            6.7        8.0
                                      Level.                            
E200, %............................  Extension           38         61  
                                      Level.                            
E300, %............................  Extension           78         92  
                                      Level.                            
Aromatics, vol%....................  Extension           20         45  
                                      Level.                            
Olefins, vol%......................  Extension            3.0       18  
                                      Level.                            
Oxygen, wt%........................  Extension            1.7        2.7
                                      Level.                            
Octane, R+M/2......................  87.5.........       87.5       87.5 
------------------------------------------------------------------------


 Table V.2.--Levels for Fuel Parameters Other Than Those Being Extended 
------------------------------------------------------------------------
                                         Extension  Extension  Extension
             Fuel property                fuel #1    fuel #2    fuel #3 
------------------------------------------------------------------------
Sulfur, ppm............................      150        150        150  
Benzene, vol%..........................        1.0        1.0        1.0
RVP, psi...............................        7.5        7.5        7.5
E200, %................................       50         50         50  
E300, %................................       85         85         85  
Aromatics, vol%........................       25         25         25  
Olefins, vol%..........................        9.0        9.0        9.0
Oxygen, wt%............................        2.0        2.0        2.0
Octane, R+M/2..........................       87.5       87.5       87.5 
------------------------------------------------------------------------

    b. Fuels required to qualify new complex model fuel parameters. 
Seven ``addition fuels'' must be included in test programs intended to 
augment the complex model with fuel parameters not included in the 
model. These fuels are intended to provide the data necessary to 
estimate linear, squared, and interactive emission effects for the 
parameter being tested. The fuel parameter values for all seven 
addition fuels are specified in Table V.3; these values must be met to 
within the blending tolerance ranges specified in Table V.4.

        Table V.3.--Properties of Fuels To Be Tested When Augmenting The Model With A New Fuel Parameter        
----------------------------------------------------------------------------------------------------------------
                                                                           Fuels                                
              Fuel property                ---------------------------------------------------------------------
                                               1         2         3         4         5         6          7   
----------------------------------------------------------------------------------------------------------------
Sulfur, ppm...............................     150       150       150        35        35       500       500  
Benzene, vol%.............................       1.0       1.0       1.0       0.5       0.5       1.3       1.3
RVP, psi..................................       7.5       7.5       7.5       6.5       6.5       8.1       8.1
E200, %...................................      50        50        50        62        62        37        37  
E300, %...................................      85        85        85        92        92        79        79  
Aromatics, vol%...........................      27        27        27        20        20        45        45  
Olefins, vol%.............................       9.0       9.0       9.0       2.0       2.0      18        18  
Oxygen, wt%...............................       2.1       2.1       2.1       2.7       2.7       1.5       1.5
Octane, (R+M)/2...........................      87        87        87        87        87        87        87  
New Parameter\1\..........................       C       C+B         B         C         B         C         B  
                                                     ----------                                                 
                                                           2                                                    
----------------------------------------------------------------------------------------------------------------
\1\C=Candidate level, B=Baseline level.                                                                         

    In Table V.3, Fuel 1 is the candidate fuel, Fuel 3 is the 
candidate-baseline fuel, and Fuel 2 is a dilution fuel that is tested 
to determine whether emissions respond linearly to levels of the 
candidate fuel parameter. Testing on addition fuels 1, 2, and 3 will 
provide the data needed to assess the emission effects of the parameter 
being tested in isolation. Three separate levels of the parameter are 
specified in order to provide data to estimate both linear and squared 
terms involving the parameter, while other fuel parameters have been 
set at levels expected to be typical of in-use reformulated gasolines. 
Fuels 4 and 5 are low-emitting fuels with candidate and baseline levels 
of the parameter in question. Fuels 6 and 7 are the corresponding high-
emitting fuels. Testing on these four fuels will provide the data 
needed to assess the existence and size of interactive effects between 
the parameter being tested and other fuel parameters already included 
in the complex model. Estimating these effects for very high emitting 
fuels (addition fuels 6 and 7) and very low emitting fuels (addition 
fuels 4 and 5) maximizes the sensitivity of the test program to such 
effects.
    If the parameter being tested is not specified for CAA baseline 
gasoline, its baseline level must be comparable to its level in 
gasoline representative of commercial reformulated gasolines. 
Petitioners are required to obtain approval for the baseline level of 
this parameter from the Agency prior to beginning their vehicle test 
programs. Such approval would depend in part on the use of an 
appropriate basis for determining the properties of ``representative'' 
commercial reformulated gasolines. The basis for this specification and 
for the specifications described in Table V.3 are discussed more fully 
in section IV.G of the RIA.
    c. Other fuels requirements. To produce fuels with the parameter 
values listed above for the extension and addition fuels, the amount 
and type of paraffins present in each fuel may require adjustments. 
These adjustments must reflect the distribution of paraffin types in 
representative refinery streams. Two other issues must also be 
addressed regarding the composition and properties of extension and 
addition fuels. First, non-compositional fuel properties such as RVP, 
E200, and E300 may differ from the values specified in Tables V.2 and 
V.3 as a natural result of compositional differences among fuels or as 
a result of the inherent variability in blending processes. In such 
cases, the complex model is to be used to compensate for such 
differences when evaluating vehicle testing results, as described in 
section 80.48 of today's regulations.
    Second, EPA also is concerned that variations due to blending may 
cause fuel parameters not included in the model to vary among fuels, 
and such parameters may have significant emission effects not predicted 
by the model. To minimize this risk, the properties of the various 
fuels must match those specified in Tables V.1 through V.3 to within 
the tolerances defined in Table V.4. In addition, the extension and 
addition fuels must be blended from identical refinery streams to the 
extent possible. Failure to meet this requirement would reduce the 
certainty that emission effects found in vehicle testing are due solely 
to the parameter being tested. However, if a petitioner can show that 
it is not feasible to meet all such tolerances for the petitioner's 
fuels due either to: (1) Naturally-resulting changes in fuel parameters 
arising from changes in the parameter(s) in question or (2) blending 
technology limitations, EPA will consider modifying the relevant 
tolerances. Any such request must come prior to the start of the test 
program. In such cases, EPA reserves the right to use the model and 
relevant data from prior augmentation petitions to adjust for whatever 
differences remain among the fuels. 

             Table V.4.--Fuel Parameter Blending Tolerances             
------------------------------------------------------------------------
                                                            Blending    
                   Fuel parameter                          tolerance    
------------------------------------------------------------------------
Sulfur content.......................................  25   
                                                        ppm.            
Benzene content......................................  0.2  
                                                        vol %.          
RVP..................................................  0.2  
                                                        psi.            
E200 level...........................................  2 %. 
E300 level...........................................  4 %. 
Oxygenate content....................................  1.0  
                                                        vol %.          
Aromatics content....................................  2.7  
                                                        vol %.          
Olefins content......................................  2.5  
                                                        vol %.          
Saturates content....................................  2.0  
                                                        vol %.          
Octane...............................................  0.5. 
Candidate parameter..................................  To be determined 
                                                        as part of the  
                                                        augmentation    
                                                        process.        
------------------------------------------------------------------------

    An octane requirement of 87.5 (measured by the (R+M)/2 method) must 
be met for all fuels used in vehicle testing to within the tolerance 
specified in Table V.4, unless octane itself is the fuel property being 
evaluated for its effect on emissions. All test fuels must also contain 
detergent additives in concentrations adequate to meet the requirements 
of section 211(l) of the Act, and the concentration must be within ten 
percent of the average detergent concentration for all fuels included 
in the test program.
6. Test Procedures
    For the reformulated gasoline program to achieve actual in-use 
reductions in fuel-related VOC and toxics emissions, certification test 
results must correlate with reductions in in-use emissions. No test 
procedure, however, is completely representative of all in-use 
conditions. The range of vehicle uses and operating conditions and the 
range of geographical and climatic conditions throughout the country 
prevent a single test procedure from being entirely representative. 
However, EPA has developed or is in the process of developing test 
procedures which attempt to reflect a broad spectrum of in-use vehicle 
operating conditions. These test procedures were used in part to 
develop the emission factors in EPA's MOBILE4.1, MOBILE5, and MOBILE5A 
emission models, which in turn have been used to develop the modeling 
option for fuel certification. To maintain consistency between the 
certification methods, these test procedures also are to be used for 
vehicle testing to augment the model.
    a. Exhaust emission testing. Exhaust emissions must be measured 
through the use of the Federal Test Procedure (FTP) for new vehicle 
certification (Subpart B of Part 86 of the Code of Federal Regulations) 
with modifications to allow vehicle preconditioning between tests on 
different fuels and to provide for benzene, formaldehyde, acetaldehyde, 
and 1,3-butadiene sampling and analysis. Since POM (the fifth regulated 
toxic air pollutant) cannot currently be measured accurately and since 
no single measurement procedure is generally accepted, its measurement 
is not required. A detailed description of the toxics measurement 
procedures can be found in section 80.55 and section 80.56 of the 
regulations for this rulemaking.
    b. Fuel parameter measurement precision. One source of error in 
testing programs as described in this section is uncertainty in the 
composition and properties of the fuels being tested. Since fuel 
testing is far less expensive than vehicle emission testing, EPA 
believes it is highly cost effective to measure the properties of the 
fuels multiple times to reduce the uncertainty in projected emissions 
due to uncertainty in fuel composition. As a result, at minimum, the 
properties defined in Table V.5 must be measured a sufficient number of 
times to reduce the 95 percent confidence interval, as calculated using 
a standard t-test, to the tolerances defined in Table V.5. 

Table V.5.--Fuel Parameter Measurement tolerances for Fuel Certification
                           by Vehicle Testing                           
------------------------------------------------------------------------
                                                         Measurement    
                                                        tolerance (95   
                     Parameter                       percent confidence 
                                                          interval)     
------------------------------------------------------------------------
API Gravity.......................................  0.2     
                                                     deg.API.           
Sulfur content....................................  5 ppm.  
Benzene content...................................  0.05 vol
                                                     %.                 
RVP...............................................  0.08    
                                                     psi.               
Octane............................................  0.1 (R+M/
                                                     2).                
E200 level........................................  2 %.    
E300 level........................................  2 %.    
Oxygenate content.................................  0.2 vol 
                                                     %.                 
Aromatics content.................................  0.5 vol 
                                                     %.                 
Olefins content...................................  0.3 vol 
                                                     %.                 
Saturates content.................................  1.0 vol 
                                                     %.                 
Octane............................................  0.2.    
Candidate parameter...............................  To be determined as 
                                                     part of the        
                                                     augmentation       
                                                     process.           
------------------------------------------------------------------------

    EPA recognizes that fuels used in vehicle testing may differ 
significantly in composition in terms of specific chemical species 
while appearing to be identically composed in terms of broad chemical 
families. The Agency further recognizes that such compositional 
differences may result in emission effects, and that such differences 
may confound or be used to ``game'' testing programs. Therefore, the 
fuels used in vehicle testing must be blended from representative 
refinery streams, and their composition must be fully characterized by 
gas chromatography or equivalent analysis methods (following the 
methodology used in the Auto/Oil study3) and the results submitted 
to EPA. Petitioners would have the option of either submitting these 
results for approval prior to beginning vehicle testing or including 
these results in their completed petition. However, in either case, EPA 
would retain the authority to require modifications to the test fuels 
to ensure that their compositions are appropriate. Hence petitioners 
electing not to obtain prior approval of their fuel compositions would 
assume the risk that EPA may require modifications to the petitioner's 
test fuels upon receipt of the completed petition, thereby invalidating 
any testing the petitioner may have completed.
---------------------------------------------------------------------------

    \3\Auto/Oil Air Quality Improvement Research Program, Technical 
Bulletin #1, December 1990.
---------------------------------------------------------------------------

    EPA received a number of comments on its fuel specification and 
measurement precision proposals. Many of these comments have been 
incorporated in today's testing regulations, notably removal of the end 
point specification and inclusion of detergents and octane 
specifications. A detailed discussion of comments can be found in 
Section VI.G of the RIA.
    c. Other test fuel provisions. To maximize the accuracy and 
confidence in the results from a test program of the magnitude 
specified in this section, it is good practice to ensure that 
systematic changes in the emission characteristics of the test vehicles 
do not occur during testing. Such effects can overwhelm the fuel 
effects being measured. Therefore, the first fuel tested in any given 
vehicle must be retested in that vehicle at the end of the test 
program. In addition, the order in which fuels are tested on each 
vehicle must be randomized to prevent carryover effects from biasing 
test results.
    In response to comments, EPA has decided to remove the requirement 
for repeat measurements of VOC and NOX emissions from each fuel. 
EPA considers the measures described above to provide adequate quality 
assurance without repeat measurements and recognizes that removal of 
the repeat testing requirements will make vehicle testing significantly 
less onerous and time-consuming.
7. Vehicle Selection
    a. 1990 Equivalency. Section 211(k)(3) of the CAA specifies that 
the required reductions in VOC and toxics emissions are to be measured 
from the emissions of those pollutants from ``baseline vehicles.'' 
Section 211(k)(10)(A) defines baseline vehicles as representative model 
year 1990 (MY-90) vehicles. However, in order to simplify test vehicle 
selection and remain consistent with the practices used to develop the 
complex model, other model year vehicles may be included in the test 
program. Specifically, 1986 through 1989 model year vehicles may be 
tested if the 1990 version had an engine and exhaust system that was 
not different from the earlier model year versions in ways that could 
affect the emission performance of the vehicles (i.e., if the model's 
EPA emission certification data were ``carried over'' through the 1990 
model year4). EPA retains the right to reject any non-1990 model 
year vehicle that the manufacturer deems to be different in terms of 
emission control technology or engine design from 1990 vehicles made by 
that manufacturer. The test fleet must be composed only of light-duty 
vehicles and light-duty trucks, in keeping with the practices followed 
in developing the complex model.
---------------------------------------------------------------------------

    \4\For a more complete explanation of this issue, please see 
``1990 Baseline Vehicles,'' memorandum from David Korotney to EPA 
Air Docket A-92-12, November 30, 1993.
---------------------------------------------------------------------------

    b. Vehicle selection criteria. Another consideration in vehicle 
selection is the condition of the test vehicles. EPA believes that 
Congress intended that the required VOC and toxics emission reductions 
be achieved not only at certification but also in-use. In order for 
this to be true, the test vehicles' condition should be representative 
of that of in-use vehicles. Therefore, for the purposes of the 
reformulated gasoline program, representative vehicles must have 
emission performances typical of the in-use emission performance of 
1990 vehicles over their lifetime, a technology mix similar to that of 
the 1990 model year fleet, and a minimum of 4,000 miles of service to 
assure break-in of engine and emission control system components. In 
addition, the test fleet must contain vehicles with a distribution of 
VOC emissions similar to that of in-use vehicles. Emissions of other 
pollutants tend to respond in a similar manner (e.g., carbon monoxide 
and air toxics) or in an essentially uncorrelated manner (e.g., 
NOX).
    In order for the emissions effects measured during vehicle testing 
to reflect the emission effects that will be experienced by actual in-
use vehicles, EPA considers it necessary to control the composition of 
the test fleet. As discussed in Section IV, EPA's complex model has 
identified significant differences in the effects of fuel modifications 
on emissions among vehicles from different emitter classes and 
technology groups. EPA's vehicle fleet requirements are intended to 
assure that a sufficient number of vehicles are tested to provide 
statistical confidence in observed emission effects, to assure that the 
vehicles tested are representative of the emission characteristics of 
in-use vehicles, and to assure that the vehicles tested have emission 
control technologies that are representative of emission control 
technologies found on 1990 model year vehicles.
    (1) Higher Emitters/Normal Emitters. In order that the test fleet 
for exhaust emission testing reflect the distribution in vehicle 
emission performance in-use, the test fleet must consist of two exhaust 
VOC emitter subfleets, normal emitters and higher emitters. The 
proportion of vehicles in each subfleet is to be set equal to the 
distribution of vehicle emission performance when enhanced I/M programs 
are in place. These proportions are shown in Table V.6, which is based 
on an EPA analysis5 of the distribution of the in-use emission 
performance of a hypothetical fleet composed entirely of 1990 model 
year vehicles when subject to an enhanced I/M program. This 
distribution is consistent with the assumptions made in developing the 
Phase II Complex Model.
---------------------------------------------------------------------------

    \5\``Exhaust VOC Emission Inventory By Vehicle Emitter Class 
Following Implementation of an Enhanced Inspection and Maintenance 
(I/M) Program'', Memorandum from Christian Lindhjem and David 
Brzezinski to EPA Air Docket A-92-12, June 24, 1993.

            Table V.6.--Emitter Groups and In-Use Emissions             
------------------------------------------------------------------------
                                              Fraction      Emission    
                                               of in-       fraction    
                Emitter group                    use   -----------------
                                               fleet     VOCs      NOX  
------------------------------------------------------------------------
Normal: <2 x THC Standard (<0.82 g/mi)......     0.738    0.444    0.738
Higher: 2 x THC Standard (0.82 g/mi)..............................     0.262    0.556    0.262
------------------------------------------------------------------------

    An option had been proposed for comment which would not have 
separated the test fleet into separate emitter groups under the 
assumption that they may not respond differently to fuels. However, 
EPA's analysis of the complex model database and the complex model 
itself indicates that this assumption is invalid. Hence EPA has 
determined that the test fleet must contain vehicles from both emitter 
groups.
    Assembling a test fleet with the specified emission performance 
distribution requires vehicles to be obtained with the desired emission 
performance. For the reformulated gasoline program, such vehicles must 
be obtained by randomly selecting vehicles with the desired emission 
performance from the in-use fleet and testing those vehicles in their 
as-received condition. This method helps assure that the vehicles 
selected for testing have emission control problems that are 
representative of in-use emission problems. EPA had considered allowing 
normal emitting vehicles with intentionally-disabled emission control 
systems to serve as higher emitting vehicles, but no suitable 
disablement scheme has been identified and evidence indicating that 
disabled vehicles would have emission performance representative of in-
use higher emitters has not been found. For these reasons, EPA will not 
permit higher emitting vehicles to be created by intentionally 
disabling normal emitting vehicles.
    Test vehicles' emission performance will need to be pre-screened to 
place them in the appropriate emitter group and to assure the proper 
emissions distribution within the test fleet. Such prescreening tests 
must be conducted using EPA vehicle certification fuel (Indolene) over 
the Federal Test Procedure since these were the conditions which were 
used to generate the data for the in-use emission distribution. 
Prescreening tests can also be performed using the Clean Air Act 
baseline gasoline and/or the I/M 240 test procedure. Results from such 
tests can be correlated with FTP test results with Indolene (as 
outlined in section 80.62 of the accompanying regulations).
    (2) Technology Groups. As discussed in Section IV, the development 
of the complex model revealed that the emissions effect of fuel 
modifications in normal emitting vehicles varied among the engine and 
exhaust system technologies present in 1990 model year vehicles. Hence 
EPA has concluded that the normal emitter test fleet must have a 
technology distribution that is representative of the technology 
distribution present in the 1990 model year fleet. The required 
distribution is shown in Table V.7.
    In addition to the technology group criteria of Table V.7, 
approximately 30 percent of the vehicles selected for each emitter 
class sub-fleet must be light-duty trucks (LDTs) to reflect the 
representation of LDTs in the light-duty vehicle fleet. EPA believes 
that the benefits of providing flexibility in determining the selection 
of LDTs for the test fleet outweigh the benefits of accuracy achieved 
by specifying which vehicles from Table V.7 should be LDTs. However, as 
is also the case for other design elements of the test program, the 
distribution of LDTs among the normal emitter technology groups is 
subject to EPA approval.
    A number of commenters objected to the application of this 
technology group distribution to the higher emitting vehicle subfleet, 
as was specified in prior proposals. EPA's experience in developing the 
complex model, as discussed in Section IV and the RIA, confirms that 
higher emitter emissions tend to be much less dependent on vehicle 
technology differences than are normal emitter emissions. Therefore, 
the higher emitting vehicle subfleet need not meet the technology 
distribution requirement, though a mixture of vehicle models and 
manufacturers should still be included. The higher emitter subfleet 
also must meet the 1990 model year and light duty vehicle criteria 
described previously and, like other elements of proposed testing 
programs, is subject to EPA approval.

                                    Table V.7.--Test Vehicle Characteristics                                    
----------------------------------------------------------------------------------------------------------------
                                                                                          Tech.                 
          Veh. #             Fuel system     Catalyst    Air injection        EGR         group    Manufacturer 
----------------------------------------------------------------------------------------------------------------
1..........................  Multi.......  3W            No Air........  EGR...........        1  GM.           
2..........................  Multi.......  3W            No Air........  No EGR........        2  Ford.         
3..........................  TBI.........  3W            No Air........  EGR...........        3  GM.           
4..........................  Multi.......  3W+OX         Air...........  EGR...........        4  Ford.         
5..........................  Multi.......  3W            No Air........  EGR...........        1  Honda.        
6..........................  Multi.......  3W            No Air........  No EGR........        2  GM.           
7..........................  TBI.........  3W            No Air........  EGR...........        3  Chrysler.     
8..........................  Multi.......  3W+OX         Air...........  EGR...........        4  GM.           
9..........................  TBI.........  3W+OX         Air...........  EGR...........        7  Chrysler.     
10.........................  Multi.......  3W            Air...........  EGR...........        5  Toyota.       
11.........................  Multi.......  3W            No Air........  EGR...........        1  Ford.         
12.........................  Multi.......  3W            No Air........  No EGR........        2  Chrysler.     
13.........................  Carb........  3W+OX         Air...........  EGR...........        9  Toyota.       
14.........................  TBI.........  3W            No Air........  EGR...........        3  Ford.         
15.........................  Multi.......  3W+OX         Air...........  EGR...........        4  GM.           
16.........................  Multi.......  3W            No Air........  EGR...........        1  Toyota.       
17.........................  Multi.......  3W            No Air........  No EGR........        2  Mazda.        
18.........................  TBI.........  3W            No Air........  EGR...........        3  GM.           
19.........................  Multi.......  3W+OX         Air...........  EGR...........        4  Ford.         
20.........................  Multi.......  3W            No Air........  EGR...........        1  Nissan.       
----------------------------------------------------------------------------------------------------------------


                                     Table V.8--Technology Group Definitions                                    
----------------------------------------------------------------------------------------------------------------
                Tech. group                    Fuel system       Catalyst      Air injection           EGR      
----------------------------------------------------------------------------------------------------------------
1...........................................  Multi.........  3W              No Air..........  EGR             
2...........................................  Multi.........  3W              No Air..........  No EGR          
3...........................................  TBI...........  3W              No Air..........  EGR             
4...........................................  Multi.........  3W+OX           Air.............  EGR             
5...........................................  Multi.........  3W              Air.............  EGR             
6...........................................  TBI...........  3W              Air.............  EGR             
7...........................................  TBI...........  3W+OX           Air.............  EGR             
8...........................................  TBI...........  3W              No Air..........  No EGR          
9...........................................  Carb..........  3W+OX           Air.............  EGR             
----------------------------------------------------------------------------------------------------------------

Legend for Tables V.7 and V.8

Fuel System:
    Multi = Multi-point fuel injection
    TBI = Throttle body fuel injection
    Carb = Carburetted
Catalyst:
    3W = 3-Way catalyst
    3W+OX = 3-Way catalyst plus an oxidation catalyst
Air Injection:
    Air = Air injection
    No Air = No air injection
EGR:
    EGR = Exhaust gas recirculation
    No EGR = No exhaust gas recirculation

    Vehicles must be added to the normal emitter sub-fleet in the order 
in which they appear in the table. If more than 20 vehicles are 
included in the normal emitter sub-fleet, then the additional vehicles 
must be selected starting over with vehicle number one in Table V.7.
    (3) Number of Test Vehicles. Exhaust emissions are subject to 
considerable variability due to the complexity of combustion chemistry, 
engine behavior, and emission control. As a result, substantial 
statistical uncertainty typically exists in exhaust emission reduction 
estimates based on a single test program. To reduce this uncertainty, 
an adequate number of vehicles must be tested for their exhaust 
emissions. In order to keep statistical uncertainty reasonably low 
while at the same time limit the test fleet size to reasonable levels, 
the test fleet for exhaust emissions must consist of a minimum of 20 
vehicles. To maintain adequate statistical confidence in test results, 
however, the distribution of the test fleet among the emitter groups 
must also be defined so as to minimize statistical uncertainty. As 
discussed in the April 16, 1992 proposal, differences in VOC, NOX 
and toxics emission distributions for in-use vehicles prevents 
optimization of the size of the emitter groups for all three pollutants 
simultaneously. EPA is basing the number of vehicles in each emitter 
group on their VOC emission performance, based on the reasons discussed 
in the April 16, 1992 proposal and on the use of VOC emission 
performance to define emitter groups.
    The uncertainty associated with VOC emissions is quite complex. The 
higher emitting vehicles in various test programs have tended to have 
significantly greater variability in emission effects than normal 
emitting vehicles. Hence to minimize statistical uncertainty, a greater 
proportion of higher emitters should be tested than would be suggested 
by their contribution to in-use emissions. However, EPA believes that 
pre-screening and stabilization of higher emitters can reduce their 
variability to approach that of normal emitters. Therefore, to minimize 
the statistical uncertainty in the test program the number of normal 
and higher emitters in the test fleet should represent the contribution 
of each sub-fleet to total in-use emissions. Since the relative 
contribution of normal and higher emitters to total VOC emissions is 
approximately equal (as discussed at length in the RIA), equal numbers 
of normal and higher emitters must be contained in any test fleet.
    (4) Waiver Provisions for Different Test Program Requirements. A 
number of options were discussed in April 16, 1992 which attempted to 
simplify or minimize the vehicle test fleet requirements while still 
maintaining the statistical confidence in the results of any test 
program. Based upon EPA's experience with the programs conducted as 
part of the complex model development, the test fleet provisions 
promulgated here represent the minimum possible if adequate statistical 
confidence in test program results is to be maintained. In fact, EPA 
believes that many petitioners may desire to test additional vehicles 
in order to improve their study's statistical power and thereby improve 
the likelihood that an augmentation petition would be granted.
    Nevertheless, in some instances petitioners may believe that a more 
optimal test fleet composition than the one specified above exists for 
the fuel parameter being tested. In such cases, petitioners can 
petition the Administrator to approve a waiver from certain of the 
requirements in this section relating to the number of test vehicles 
and their distribution among the normal and higher emitter groups. Any 
such waiver would have to be obtained in advance of the start of the 
test program involved. A request for such a waiver must include an 
adequate justification for the requested change, including the 
rationale for the request and supporting data and information. EPA 
reserves the right to require testing of additional vehicles beyond the 
20-vehicle minimum where such testing is necessary to evaluate emission 
effects properly.
8. Data Analysis
    a. Weighting of emission test data. The manner in which the test 
data is to be analyzed must be consistent with the goal that the 
emission benefits from reformulated gasoline be realized in-use, just 
as is the case for the exhaust emission complex model itself (as 
discussed in Section IV). Therefore, augmentation of the models with 
vehicle testing results must reflect the effects of fuel modifications 
on emissions of each exhaust pollutant (VOC, NOX, benzene, 1,3-
butadiene, formaldehyde, and acetaldehyde) on 1990 vehicles. The 
augmentation also must incorporate differences in these effects for 
vehicles with different emission control technologies and different 
emission levels. The vehicle selection criteria discussed above are 
intended to satisfy these requirements without requiring an extremely 
large test fleet. The results of vehicle test programs will be weighted 
to reflect the contribution of each emitter class and technology type 
to in-use emissions according to the procedure described in Section IV 
for the exhaust emission complex model.
    b. Data analysis to extend the range of existing model parameters. 
When extending the range of a fuel parameter already included in the 
complex model, EPA believes that the data generated through vehicle 
testing should be combined with the data used to develop the complex 
model itself. This approach offers several important advantages. First, 
it takes full advantage of existing knowledge regarding the effects of 
the parameter in question on emissions. Second, it reduces 
inconsistencies between the complex model and the augmentation, thereby 
simplifying certification and enforcement. Third, it reduces the 
possibility of petitioners deliberately manipulating the test program 
to obtain a desired augmentation since the limited data generated by 
the test program will be combined with the much more extensive data 
available in the complex model database.
    The analysis process is described in detail in section 80.48 of 
today's regulations and in Section IV.G of the RIA. The process 
requires that the emission effects of the parameter being tested be 
verified at the extended level while not permitting emission effects of 
other parameters to be modified from the effects incorporated in the 
complex model. In addition, the augmentation would only apply to fuels 
with levels of the parameter being tested that fall outside the range 
for which the complex model is valid. These safeguards are intended to 
prevent the results of vehicle testing from being used to alter aspects 
of the complex model that a fuel supplier or other organization deems 
undesirable.
    c. Data analysis to add new fuel parameters. Vehicle test data for 
new fuel parameters such as new additives cannot be analyzed in the 
manner described above for existing fuel parameters. Vehicle-to-vehicle 
variability can cause significant differences in vehicle responses to 
parameters already included in the complex model from what the complex 
model would predict. The analysis method described above would apply 
these differences entirely to the new parameter, which would allow 
substantial opportunities to game the testing and model augmentation 
process. To minimize the risk of gaming and assure proper 
representation of the effects of new fuel parameters, a different 
analysis process must be used when augmenting the model with a new fuel 
parameter. This process is designed to identify the effects of the new 
parameter itself, including its behavior upon dilution, as well as any 
interactive effects between the parameter and existing complex model 
parameters.
    The process itself is described in detail in section 80.48 in 
today's regulations and in Section IV of the RIA. The modeling process 
incorporates five techniques to minimize gaming and isolate the actual 
emission effects of the new parameter being tested. First, the complex 
model is used to adjust the emissions performance of the test vehicles 
on the three fuels for any differences in fuel parameters other than 
the one being tested. These adjustments should be minor, since fuel 
properties other than the one being tested are required to be nearly 
identical. Second, the linear and squared terms for the new parameter 
are determined based on test data from addition fuels 1, 2, and 3 
before interactive effects are introduced into the augmented complex 
model based on the results of testing addition fuels 4, 5, 6, and 7. 
This approach is used because the direct effects of fuel parameters 
(represented by the linear and squared terms) are less easily gamed or 
obscured than are interactive effects since fewer variables are 
involved. Third, the statistical criteria defined in section 80.57 are 
used to assure that only statistically significant terms are included 
in the augmentation.
    Fourth, the model must include all terms for the pollutant being 
modeled that are already included in the complex model. In addition, 
only the linear, squared, and interactive terms involving the new 
parameter are permitted to enter the augmentation. The coefficients for 
the complex model terms will be fixed at the values established in this 
rule. By not permitting the augmentation to change existing complex 
model terms, the analysis process reduces opportunities to game to 
modify complex model effects that the testing organization considers 
undesirable.
    Fifth, augmentations are not permitted for parameters not contained 
in the complex model but for which measurements exist in the complex 
model database. Including such parameters in an augmented complex model 
is likely to result in large changes in complex model coefficients due 
to the interrelationship between fuel properties. Such changes would 
complicate enforcement and might introduce fungibility problems that 
would diminish the in-use effectiveness of reformulated fuels. Further, 
EPA's experience in developing the complex model suggests that 
including such parameters would introduce collinearity problems and 
exacerbate the risk of test program gaming. Since such parameters were 
considered for inclusion in the complex model but were rejected based 
on input from affected parties and EPA staff, EPA has decided not to 
permit augmentations for such parameters. However, the Agency will 
consider including such parameters in subsequent revisions to the 
complex model.
    Interactive terms were not permitted to enter EPA's complex models 
for exhaust toxics, as discussed in Section IV and the RIA. Hence 
interactive effects on toxics emissions are not permitted in 
augmentation petitions, unless the test program was intended and 
specificially designed to investigate such effects.
    The preceding discussion assumes that the interactive effects 
identified through testing cannot be traced to a specific cause. If the 
cause of the interactive effect can be identified, it may be 
appropriate to determine a greater beneficial augmentation due to the 
parameter in question than the effects identified through the procedure 
above or to include an interactive term in the complex model. 
Therefore, EPA will allow testing of additional fuels to identify the 
cause of the interactive effect and the magnitude of the effect for 
representative in-use fuels (again subject to Agency approval regarding 
the appropriateness of the petitioner's definition of representative 
gasoline). Petitioners will be required to obtain approval from the 
Administrator for the proposed additional testing before beginning such 
testing. Petitioners will be permitted to claim larger benefits for the 
parameter in question based on the results of such tests, subject to 
the approval of the Administrator.
    For a more complete description of these procedures, the reader is 
referred to section 80.57 of the regulations and to Section IV of the 
RIA.
    d. Acceptance criteria. As discussed in Section H, EPA reserves the 
right to evaluate the quality of testing data submitted in support of 
petitions to augment the models, to reject test data or analyses 
submitted to the Agency if such data or analyses are found to be 
insufficient, flawed, or otherwise deficient, and to include test data 
or analyses from other sources when evaluating the proposed 
augmentation to the model.

VI. Phase II (Post-1999) Reformulated Gasoline Performance Standards 
and NOX Standards for Reformulated Gasoline

A. Introduction

    The Clean Air Act (the Act), as amended in November 1990, 
establishes a more stringent minimum level of control of ozone-forming 
VOCs and air toxics emissions from reformulated gasoline beginning in 
the year 2000 than is required prior to that date. For the first five 
years of the reformulated gasoline program (Phase I; January 1, 1995 
through December 1999), Congress established a minimum requirement of 
15% reduction of ozone forming VOCs and toxic air pollutants [CA 
section 211(k)(3)(B)].6 Starting with January 1, 2000 (Phase II), 
the 15% minimum required reductions are increased to 25%, with the 
provision that EPA may increase or decrease this level based on 
technological feasibility, considering cost, but may not decrease it 
below 20% [CA section 211(k)(3)(B)]. The restriction on increases in 
NOX emissions continues to apply during Phase II of the program.
---------------------------------------------------------------------------

    \6\The numerical performance standard of Sec. 211(k)(3)(B) sets 
the minimum level of reductions, as it is more stringent than the 
reductions achieved by the formula fuel in Sec. 211(k)(3)(A).
---------------------------------------------------------------------------

    The regulatory negotiation conducted by EPA for this rulemaking did 
not address the Phase II VOC and toxics standards, nor did it address a 
reduction in NOX emissions beyond the statutory cap imposed under 
section 211(k)(2)(A). After analyzing the costs and benefits of various 
controls, along with other relevant factors, EPA proposed a range of 
possible Phase II standards for VOC and toxics. Furthermore, based on 
EPA's view that NOX reductions were important to achieve 
attainment of the ozone NAAQS in many nonattainment areas, EPA also 
proposed a NOX reduction performance standard for Phase II 
reformulated gasoline relying on EPA's authority under section 
211(c)(1)(A). A more detailed discussion of EPA's Phase II proposals 
for VOCs, toxics, and NOX is provided in subsection 2 below.
    For the reasons described below, EPA has decided to establish per 
gallon Phase II VOC performance standards of 25.9% for VOC control 
region 2 (northern areas) and 27.5% for VOC control Region 1 (southern 
areas).7 EPA is also promulgating a per gallon toxics performance 
standard of 20% for all reformulated gasoline. Reformulated gasoline 
will also have to meet a 5.5% per gallon reduction in emissions of 
NOX. EPA has also established more stringent VOC, toxics, and 
NOX performance standards where a refiner or importer complies on 
average, as well as minimum per gallon standards, as explained in 
section C below.
---------------------------------------------------------------------------

    \7\The 27.9% VOC performance standard for VOC control region 1 
is measured against the statutory baseline gasoline, which has an 
RVP of 8.7 psi. This amounts to a 17.7% VOC reduction when measured 
against a baseline gasoline with RVP of 7.8 psi.
---------------------------------------------------------------------------

1. Statutory Requirements
    Section 211(k)(1) requires that reformulated gasoline achieve the 
greatest reductions possible in volatile organic compounds (VOCs) and 
toxics emissions, ``taking into consideration the cost of achieving 
such emission reductions, any nonair-quality and other air-quality 
related health and environmental impacts and energy requirements. 
Specifically, section 211(k)(3)(B) of the Act requires that, in the 
year 2000 and beyond, ``aggregate emissions of ozone-forming volatile 
organic compounds from baseline vehicles8 when using reformulated 
gasoline shall be 25 percent below the aggregate emissions of ozone 
forming volatile organic compounds from such vehicles when using 
baseline gasoline9.'' Similarly, a 25% reduction in emissions of 
toxic air pollutants is required. The Act also specifies that the 
Administrator may adjust the 25 percent reduction level to provide for 
lesser or greater reductions based on technological feasibility, giving 
consideration to the cost of achieving such reductions. In no case can 
the required reduction be less than 20 percent. The Act further 
provides that emissions of oxides of nitrogen (NOX) cannot 
increase as a result of the use of reformulated gasoline. These VOC and 
toxics reductions and NOX limit are known as the Phase II 
reformulated gasoline standards.
---------------------------------------------------------------------------

    \8\According to section 211(k)(10)(A) of the Act, ``baseline 
vehicle'' means representative model year 1990 vehicles.
    \9\The formulation for summertime baseline gasoline is defined 
in section 211(k)(10)(B) of the Act. See further discussion of 
baseline emissions in section IV.
---------------------------------------------------------------------------

    Section 211(c) of the Act allows the Administrator to regulate 
fuels or fuel additives if ``any emission product of such fuel or fuel 
additives causes, or contributes to, air pollution which may reasonably 
be anticipated to endanger the public health or welfare.'' Section 
211(c)(2) further provides that EPA cannot control these fuels and fuel 
additives ``except after consideration of all relevant medical and 
scientific evidence available * * *, including consideration of other 
technologically or economically feasible means of achieving emissions 
standards.'' In addition, EPA must find that the prohibition ``will not 
cause the use of any other fuel or fuel additive which will produce 
emissions which will endanger the public health or welfare to the same 
or greater degree than the use of the [regulated fuel/fuel additive].''
    EPA has elected to use this authority to require reformulated fuels 
to also achieve NOX reductions in order to reduce ozone formation, 
based on scientific evidence regarding the benefits of NOX control 
and on the cost-effectiveness of NOX reductions. The determination 
of the need for, scientific justification of, and cost-effectiveness of 
NOX control is presented in the RIA and summarized in subsection 
C.2 below.
2. Proposal
    EPA proposed a range of VOC and toxics performance standards for 
Phase II reformulated gasoline, covering a variety of options for 
setting these standards [see the Notice of Correction for the Proposed 
Rule 58 FR 17175 (April 1, 1993)]. The proposed VOC standards ranged 
between 29.7 and 37.7 percent reduction in emissions for VOC control 
region 1 areas (Class A and B, the southern areas of the country) based 
on a baseline fuel with an RVP of 8.7 psi10, and between 26.7 and 
34.7 percent reduction for VOC control region 2 areas (Class C, the 
northern areas of the country) [58 FR 17178, 17179, 17180 (April 1, 
1993)]. These percentage reductions are in comparison to the emissions 
performance of baseline vehicles operating on baseline gasoline; the 
proposed version of the complex model was used to establish a fuel's 
emissions performance. In proposing the range of values EPA considered 
the costs of VOC control, the cost-effectiveness of the controls, the 
health and environmental effects, energy impacts, and technological 
feasibility.
---------------------------------------------------------------------------

    \1\0Relative to a baseline fuel including an RVP of 7.8 psi, the 
proposed VOC standards ranged between 20.7 and 31.7 percent 
reduction.
---------------------------------------------------------------------------

    EPA's analysis showed that fuels meeting the proposed VOC and 
toxics standards were expected to show no increase in NOX 
emissions, and in fact would likely achieve some reduction in NOX. 
Based on the expected benefits of NOX reduction, and considering 
various other factors, EPA also proposed NOX emissions reduction 
standards for Phase II reformulated gasoline based on the authority of 
section 211(c)(1)(A) of the Act. The proposed NOX standards ranged 
from 0 to 14.8 percent reduction for VOC control region 1 (southern 
areas) and 0 to 15.4 percent reduction for VOC control region 2 
(northern areas) [58 FR 17178-9 (April 1, 1993)]. Again, the NOX 
emissions performance of a fuel would be determined using the proposed 
complex model. The range of proposed standards was based, in part, on 
different levels of potentially acceptable cost-effectiveness as well 
as whether the cost-effectiveness was calculated based on reductions in 
NOX emissions alone or on the combined reduction in VOC and 
NOX emissions.
    EPA proposed alternative VOC standards that would apply depending 
on whether EPA adopted a NOX reduction standard. These were based 
on changes in the cost-effectiveness analysis from combined VOC plus 
NOX emissions reductions. As explained in the proposal, measures 
taken to achieve the NOX reductions under this option would result 
in VOC emission reductions incremental to those obtained under the 
proposed VOC only standards, which were based solely on the cost per 
ton of VOC reduced. These additional VOC emission reductions obtained 
through a combined VOC plus NOX standard presented the option of 
setting a standard for larger VOC reductions. EPA analyzed the cost-
effectiveness of a more stringent VOC standard in connection with a 
NOX standard, and proposed a range of values depending on the 
target cost-effectiveness level: for southern areas, 29.7-40.2 percent 
based on an 8.7 psi baseline RVP (20.7-33.8 percent reduction based on 
a 7.8 psi baseline RVP); for northern areas, 26.7-37.3 percent 
reduction.
    In analyzing potential VOC and NOX reduction requirements, EPA 
looked at two potential cost-effectiveness targets: $5,000/ton and 
$10,000/ton. These figures were selected as representative of the range 
of cost-effectiveness for controls which would be incurred by many 
ozone nonattainment areas in achieving attainment. In addition, they 
reflected higher cost-effectiveness values than those for any then-
existing federal nationwide motor vehicle or motor vehicle fuel control 
programs.
    Finally, EPA proposed a toxics emissions reduction standard between 
20 and 25 percent. The 25 percent reduction standard proposed was based 
on the level specified in section 211(k)(3)(ii) of the Act. In the 
proposal, EPA recognized that while on average this level of toxics 
control was cost effective, it could be highly cost ineffective for 
some refiners. The statutory minimum 20 percent reduction standard was 
proposed as an alternative to allow refiners further flexibility in 
meeting the VOC and NOX standards (and for some to reduce the need 
for capital intensive modifications specific to toxics control), under 
circumstances where in most cases large reductions in toxics emissions 
would automatically result from the VOC and NOX controls.
3. General Comments Received on Proposal
    EPA received several comments recommending a reproposal of the 
Phase II standards once the complex model was finalized and EPA could 
develop a single standard for each pollutant. One comment stated that 
the construct of the complex model will have a significant effect on 
the standards, and it was therefore not possible to comment on the 
costs or performance of the Phase II standards as proposed (since they 
were not based on the final complex model). Others commented that it 
was improper to establish standards until the model that predicts 
benefits exists. EPA does not believe it is necessary to repropose 
these standards, since the proposal presented a range of values for the 
standards and outlined all of the options that were considered. The 
final standards were derived based on the final complex model, so the 
standards include the effect of the complex model on the emissions 
reductions predicted. EPA had proposed, and it was agreed in Reg-Neg, 
that the Phase II standards would be promulgated with the complex 
model.
    Briefly described below are the factors EPA considered in setting 
the standards being promulgated today, the methodology used in 
determining the cost-effectiveness of fuel controls, and the reasoning 
used in determining the standards. The full analysis leading to the 
final standards is more thoroughly discussed in section VI of the 
regulatory impact analysis (RIA) associated with this rulemaking.

B. Factors Affecting Selection of the Phase II Standards

    In determining the Phase II reformulated gasoline standards, EPA 
considered the health, environmental, and energy impacts, as well as 
the cost and the technological feasibility of reformulating gasoline to 
attain emission reductions of VOCs, toxics, and NOX. EPA's 
analyses of these factors are discussed briefly below, and in detail in 
the RIA.
1. Health and Environmental Impacts
    The purpose of the reformulated gasoline program is to reduce motor 
vehicle emissions of ozone forming VOCs and certain specified toxic air 
pollutants in those areas most in need of such reductions. As discussed 
above, EPA is also reducing ozone forming NOX emissions from RFG 
as a part of this rulemaking. EPA measured the health and environmental 
benefits of the reformulated gasoline program in terms of the number of 
tons of VOC, NOX, and toxics reduced, since the Act specifies 
mass-based emissions reductions. The benefits of toxics reductions were 
further evaluated on the basis of the number of cancer incidences 
avoided, since this is a common measure of the effectiveness of toxics 
control. The reader is directed to section C below for quantified 
estimates of these reductions.
    The benefits of ozone reduction will be gained through the 
reduction of both VOC and NOX emissions. Ambient ozone levels and 
the effect of VOC emission reductions on these levels vary from city to 
city, making it difficult to quantify the benefits of the VOC reduction 
beyond tons of emissions reduced. In general, reductions in VOC 
emissions will improve the air quality of most affected areas and 
thereby reduce the negative health impacts of exposure to high levels 
of ozone. Visibility and other environmental measures are also improved 
through reductions in emissions of ozone precursors. Similar benefits 
will be gained through reductions in NOX emissions. The reader is 
directed to subsection C.2 for further discussion on the health and 
environmental benefits of NOX control.
    Reducing ozone levels in highly populated urban areas would help to 
reduce short-term health effects such as impaired lung function, cough, 
nausea, chest pain, throat irritation, increased susceptibility to 
respiratory infection, and increased sensitivity of asthmatics to 
allergens (e.g., pollen) and other bronchoconstrictors. Long-term 
health effects of exposure to ozone include accelerated aging of the 
lungs, reduced elasticity of the lungs, scarring of lung tissue, and 
permanent reductions in baseline lung function.
    Although the reformulated gasoline program is concentrated in urban 
areas, some reformulated gasoline will be used in rural areas as a 
result of spillover in the distribution system. Reducing ozone levels 
in rural areas would enhance agricultural crop yield, currently 
estimated to be reduced by as much as $2-3 billion per year by existing 
ozone concentrations.11 In addition, lower ozone levels would help 
reduce damage to forest ecosystems which experience lower tree growth 
rate, foliage damage, and increased susceptibility to stress (e.g., 
insects, disease, drought) caused by current tropospheric ozone 
levels.12
---------------------------------------------------------------------------

    \1\1U.S. EPA, ``Air Quality Criteria for Ozone and Other 
Photochemical Oxidants,'' EPA Report No. EPA-600/8-84/020A-E, p.1-
27.
    \1\2Ibid., p. 7-1 through 7-4.
---------------------------------------------------------------------------

    Reductions in mobile source emissions of the air toxics addressed 
in the reformulated gasoline program (benzene, 1,3-butadiene, 
formaldehyde, acetaldehyde, and POM) may result in fewer cancer 
incidences. A number of adverse noncancer health effects have also been 
associated with exposure to air toxics, particularly with higher level 
exposures experienced in particular microenvironments such as parking 
garages and refueling stations. These other health effects include 
blood disorders, heart and lung diseases, and eye, nose, and throat 
irritation. Some of the toxics may also be developmental and 
reproductive toxicants, while very high exposure can cause effects on 
the brain leading to respiratory paralysis and even death. The use of 
reformulated gasoline meeting the Phase II standards will likely help 
to reduce some of these health effects, as well. A more thorough 
discussion of the variety of possible non-cancer effects of concern 
from exposure to air toxics is contained in EPA's Motor Vehicle-Related 
Air Toxics Study.13
---------------------------------------------------------------------------

    \1\3EPA document 420-R-93-005, April 1993.
---------------------------------------------------------------------------

    The emissions reductions and cancer incidences avoided as a result 
of today's standards are discussed below in section C.
    In addition to the benefits from reductions in emissions of VOC, 
NOX, and toxics, other environmental benefits will be realized as 
a result of the use of reformulated gasoline. Emissions of carbon 
monoxide will decrease as the result of adding oxygen to the fuel, to 
the benefit of areas out of attainment for this air pollutant and to 
human health in general.14 In addition, since reformulated 
gasoline is projected to cost more than conventional gasoline, it is 
possible that consumers will purchase and, thus, use less gasoline, 
resulting in fewer overall emissions due to mobile sources.
---------------------------------------------------------------------------

    \1\4Most of this benefit will occur as a result of the use of 
oxygen in Phase I RFG, not from the Phase II reductions.
---------------------------------------------------------------------------

2. Energy Impacts
    Production of Phase II reformulated gasoline subject to performance 
standards for VOC, NOX, and toxics will require an increase in the 
amount of energy used at the refinery. An estimate of the energy used 
depends on many factors, including how the energy balance is evaluated, 
the type and source of oxygenate, the refinery configuration, and the 
reformulation approach. Determining an exact energy increase associated 
with reformulated gasoline production (on the basis of a constant level 
of gasoline energy produced) is difficult.
    As later sections of this document will show, the standards for VOC 
and NOx reduction promulgated today will likely be met largely 
through reductions in the sulfur content and Reid vapor pressure (RVP) 
of the fuel. The process used to remove sulfur from gasoline, 
hydrodesulfurization, is an energy intensive process; mainly due to the 
need for and consumption of hydrogen. The energy impact will depend on 
the sulfur level of the crude used by the refinery and the level of 
sulfur control necessary for that refinery to meet the standards. 
Reducing the RVP of the fuel requires removal of the lighter compounds 
in the fuel, also an energy consuming process. Overall, it is expected 
that the energy consumption by refineries in producing Phase II 
reformulated gasoline will increase slightly (perhaps a couple percent) 
over the level of energy used to make Phase I RFG, but the magnitude of 
this increase is difficult to measure due to the many variables 
involved.
3. Technological Feasibility
    EPA also considered the technological feasibility of producing 
fuels to meet the Phase II standards. EPA believes that the refinery 
modeling results (from which the fuel parameter control costs were 
estimated) indicated that it is technologically feasible to make the 
fuel parameter changes that were analyzed in developing the standards. 
The refinery models utilize only well-developed, demonstrated, 
commercially available technologies, and are designed to only model 
fuels within the limits of these technologies.15 Given the cost 
incentives created by this rulemaking, in all likelihood new 
technologies will be developed between now and the year 2000 which will 
reduce the costs for certain types of fuel parameter changes. Thus, EPA 
believes that the determination of fuel parameter control costs using 
the results of the existing refinery models is reasonable, that the 
costs generated are perhaps conservative, and that the technological 
feasibility of producing such emission-reducing fuels is justifiable. 
This position was supported by many of the comments received. While 
other commenters questioned the costs used in developing the proposal 
(as discussed in subsection 4.b), no comments questioned the 
technological feasibility of these refinery configurations.
---------------------------------------------------------------------------

    \1\5See the RIA for additional details on the refinery models 
used for this analysis.
---------------------------------------------------------------------------

    Because the standards promulgated today will not take effect until 
the year 2000, and because all the processes needed to produce 
complying fuels are already commercially available, EPA does not 
believe that lead time will be an issue in achieving the required 
emissions reductions.
4. Fuel Safety and Driveability
    EPA evaluated safety concerns associated with the use of low RVP 
fuels and found no significant negative impacts, as discussed in the 
RIA. Comments also raised concerns about driveability problems arising 
from the use of low RVP fuels. They raised concerns that EPA's analysis 
in the proposal did not address spring months (the transition time to 
the VOC control period), September RVP fuel sold in October, and low 
RVP gasoline sold in low temperature areas near nonattainment areas.
    While neither EPA nor any other organization conducted driveability 
testing at low ambient summer temperatures, EPA has looked at the 
actual vapor pressure of fuels currently in production, as documented 
in the draft RIA.16 Based upon a comparison of actual vapor 
pressures, EPA believes that 6.5 psi RVP fuel in the summer should have 
similar driveability to current winter fuels. At this time EPA believes 
there should be no significant driveability problems with gasoline at 
an RVP level down to 6.5 psi. Until such time as data can be gathered 
to more fully evaluate the driveability impacts of low RVP fuels, EPA 
believes that 6.5 psi may present a practical lower limit below which 
the existence of adverse driveability impacts is unknown. Discussions 
with representatives of both the oil and automotive industries 
reflected a similar uneasiness in going below 6.5 psi RVP given the 
lack of data at lower levels. However, the standards for Phase II RFG 
are performance based standards. As a result, flexibility exists for 
refiners to meet the Phase II standards, without reducing the RVP of 
the gasoline below 6.5 psi.
---------------------------------------------------------------------------

    \1\6``Draft Regulatory Impact Analysis for the Notice of 
Proposed Rulemaking of the Complex Model, Phase II Performance 
Standards, and Provisions for Renewable Oxygenates,'' February 5, 
1993.
---------------------------------------------------------------------------

5. Cost-Effectiveness of Emissions Reductions
    a. Introduction. For purposes of this discussion, EPA defines cost-
effectiveness as the ratio of the incremental cost of a control measure 
to the incremental benefit, e.g., tons of VOC or other emissions 
reduced. Considering cost-effectiveness allows the Agency to develop a 
relative ranking of various ozone and toxics control strategies so that 
an environmental goal can be achieved at minimum cost. As the cost-
effectiveness of an emission reduction strategy increases, it may be 
possible to achieve similar, substantial emission control in other ways 
(e.g., through other regulatory programs) at the same or lower cost per 
unit of benefit. EPA therefore considered cost-effectiveness in 
deciding what VOC, NOx, and toxics control, if any, to impose 
beyond the minimum levels required under section 211(k)(3)(B).
    One commenter recommended that EPA evaluate the cost-effectiveness 
of this program separately for small and large refiners, and also that 
EPA consider granting small refiners more time to comply with the 
requirements (as is allowed by California for California reformulated 
gasoline). The California reformulated gasoline program requires all 
refiners selling gasoline in the state to produce reformulated 
gasoline, and thus does not afford any flexibility to refiners, large 
or small. The federal RFG program, however, does not require 100% 
production of RFG in any region, nor does it require that every refiner 
produce RFG. Hence, small refiners can choose not to produce RFG and 
instead supply conventional gasoline if the costs of complying with the 
program are too burdensome. For those small refiners electing to 
produce RFG, the option to select between per gallon and averaging 
standards, as well as the ability to set their own baselines, gives 
them flexibility to meet the standards in the manner that is most cost 
effective for them. Furthermore, the enforcement structure is based on 
a single set of standards for Phase II RFG. Allowing some refiners to 
comply with a different set of standards would require additional and 
more complicated enforcement provisions, and could jeopardize the 
fungibility of reformulated gasolines.17 Since EPA believes that 
the existing program provides sufficient flexibility to small refiners, 
there is no need to pursue multiple enforcement programs. See section 
XV for additional discussion of the impact of this rule on small 
refiners.
---------------------------------------------------------------------------

    \1\7For Phase I RFG, the standards are set at the statutory 
minimum for both VOCs and toxics. EPA could not lawfully allow small 
refiners less stringent standards or more time to comply with the 
Phase I standards.
---------------------------------------------------------------------------

    b. Fuel Parameter Control Costs. Fuel parameter control costs and 
interrelationships between fuel parameters are integral parts in the 
evaluation of the cost-effectiveness of Phase II RFG controls. The 
costs and interrelationships used to develop the VOC and toxics 
standards were estimated from the results of refinery modeling 
performed by Bonner and Moore Management Science,18 by Turner, 
Mason, and Co. for the Auto-Oil Air Quality Improvement Research 
Program;19 by Turner, Mason, and Co. for the Western States 
Petroleum Association (WSPA);20 and by EPA in-house (using the 
Bonner and Moore refinery model).21 EPA used these regional 
refinery models to estimate the cost and interrelationships of various 
fuel parameter controls. The final average nationwide costs were 
obtained by weighing the regional values by the estimated fraction of 
total reformulated gasoline (RFG) production in each region.
---------------------------------------------------------------------------

    \1\8Bonner and Moore Management Science, ``Study of the Effects 
of Fuel Parameter Changes on the Cost of Producing Reformulated 
Gasoline,'' Prepared for EPA under contract through Southwest 
Research Institute and the National Institute for Petroleum and 
Energy Research. This data, as well as data generated by EPA in-
house, was made available to the public through the following 
document: ``DOE and API Phase II Cost Estimates,'' EPA Memorandum 
from Lester Wyborny, FSSB, to the Air Docket, November 4, 1993.
    \1\9``Costs of Alternate Gasoline Reformulations, Results of 
U.S. Refining Study,'' Turner, Mason & Co. for the Economics 
Committee of the Auto/Oil Air Quality Improvement Research Program, 
April 1992.
    \2\0``WSPA Study of the Cost Impacts of Potential CARB Phase 2 
Gasoline Regulations,'' Turner Mason & Company for the Western 
States Petroleum Association, November 18, 1993.
    \2\1``Aromatics and E200 Reformulation Costs,'' Memorandum from 
Lester Wyborny, EPA, to the Air Docket, December 10, 1993.
---------------------------------------------------------------------------

    Many comments were received on the costs used in the proposal. Some 
of these comments, and EPA's response, are summarized here, while the 
RIA contains a complete discussion and analysis of the comments 
received. Several commenters questioned the appropriateness of using 
independent refinery models to generate costs for control of individual 
parameters. In addition, they questioned the aggregation of results 
from regional models to generate national average costs, and 
recommended instead using a model from the region likely to realize the 
highest costs for producing reformulated gasoline (PADD 1). While using 
regional models to estimate national average costs requires an 
acknowledgment of the inherent limitations in such models, EPA believes 
that it is appropriate to use them for the purpose of determining the 
costs to produce reformulated gasoline. The limitations and assumptions 
made in using the refinery models and the results of this analysis are 
discussed in detail in the RIA.
    The manufacturing cost of producing gasoline is the sum of the 
capital recovery cost and the operating costs, adjusted for changes in 
the energy content of the fuel (to represent consistent fuel economy). 
VOC control is mandated only during the high ozone season, and thus all 
costs were allocated to the high ozone season in the refinery modeling 
work. In contrast to VOC control, toxics control and the benefits from 
reductions in toxics emissions occur year-round. Although the costs of 
toxics control should be determined on an annual basis, EPA used the 
same costs that were used for the VOC analysis, since it had been 
determined in the RIA (and supported by many comments received) that 
additional toxics control would be highly cost-ineffective. The level 
of either VOC or toxics control that is cost effective is not greatly 
affected by the accuracy of the costs, due to the magnitude of 
reductions achieved.
    Some comments received on the proposal raised the concern that this 
method of determining costs did not accurately reflect all of the costs 
of the program, since the ``compliance costs'' for record keeping and 
enforcement, as well as costs incurred by pipelines or other entities, 
were not included. While it is true that ``compliance costs'' will be 
incurred as a result of the reporting and enforcement requirements of 
Phase II RFG, EPA does not anticipate the costs to be greater than 
those incurred by the Phase I RFG program. Refiners will already be 
supplying the information required by EPA for Phase I, and will 
continue to do so under Phase II. Hence, there is no additional cost of 
compliance to add to the costs of Phase II RFG.
    Other factors affecting incremental fuel parameter control costs 
include the amount of reformulated gasoline produced by the refinery 
and the effects of fuel parameter changes on fuel economy. Because 
producing reformulated gasoline reduces flexibility in refinery 
operations, the cost of producing such fuels increases with the amount 
of reformulated gasoline that is produced in a given refinery. In this 
analysis, EPA used a scenario of RFG production based on participation 
in the reformulated gasoline program by the nine mandated areas, those 
areas which had opted into the program as of August 14, 1993 (the close 
of the comment period on the proposal), the entire Northeast Ozone 
Transport Region (including both attainment and nonattainment areas), 
and all other ozone nonattainment areas. This scenario was chosen to 
represent the Phase II RFG program that would result if all eligible 
areas opted into the program. Since the Ozone Transport Commission has 
not announced plans to opt-in to the RFG program, and the only 
additional nonattainment areas that have opted into the program since 
August 14 are those located in Kentucky, the volume of RFG production 
used for this analysis is overstated by about 20 percentage points. As 
a result, the cost estimates are higher than will likely be 
experienced, since use of RFG in the entire Northeast would severely 
limit refinery production in that region, incurring somewhat higher 
costs to individual refiners, particularly to those refiners which for 
economic reasons would choose not to produce RFG and merely continue 
producing conventional fuel.
    EPA evaluated the costs for incremental control levels for a 
variety of fuel parameters. This evaluation revealed that the greater 
the level of control, the higher the costs of achieving that level. 
Complete information on the development of the individual parameter 
costs is provided in the RIA.
    Several comments were received questioning the validity of 
evaluating the cost-effectiveness of Phase II RFG on a parameter by 
parameter basis. The recommended alternative was to evaluate the cost 
of producing a gasoline meeting the standards for a variety of refinery 
configurations, and to use this information to determine the cost-
effectiveness of the standard. As explained in the RIA, EPA determined 
that it was appropriate to evaluate cost-effectiveness on an 
incremental basis to properly compare fuel controls to other forms of 
emission control.
    c. Emissions reductions.--In determining the emission reductions 
and the associated cost-effectiveness of VOC control, EPA employed a 
convention typically used in estimating the benefit of both mobile and 
stationary source VOC controls. This convention requires the 
determination of cost-effectiveness on the basis of annual tons of VOC 
reduced. Thus, even though VOC emission reductions required under 
section 211(k) occur only during the high ozone season, the convention 
is to calculate the cost of the fuel parameter control per ton of VOC 
removed as if the high ozone season emission reductions were spread 
over the whole year. Comments were received that questioned the 
appropriateness of evaluating the cost-effectiveness on an annualized 
tons reduced basis rather than on a summer tons reduced basis, since 
the program is a summer program. The purpose of applying this 
convention to the evaluation of Phase II RFG was to allow direct 
comparison of the cost-effectiveness of this program with the cost-
effectiveness of other VOC control strategies, which is typically 
calculated on a year-round basis. The only other appropriate 
alternative would be to recalculate the cost-effectiveness of all other 
programs on the basis of cost per ton of control during the high ozone 
season, the only time period when emission reductions for the purposes 
of ozone control are of any significant value.
    Reductions in emissions of both exhaust and evaporative VOC are 
determined for a given fuel parameter change using the complex model. 
As discussed in earlier sections, the complex model statutory baseline 
emissions are based on 1990 vehicle technology, and compliance with the 
Phase II standards is measured relative to these base emissions. As 
explained in the RIA, EPA determined that the olefin level specified in 
the statutory baseline was not representative of the actual olefin 
level of gasoline in 1990. Phase I RFG includes no specific limits on 
olefins, and thus refiners can meet Phase I standards (under the 
complex model) by controlling any fuel parameters. However, refiners 
whose olefin baseline is significantly higher than the statutory level 
may need to reduce olefins to meet the no NOx increase 
requirement, putting them at a competitive disadvantage because olefin 
control is costly. Hence, using data from Bonner and Moore modelling as 
well as fuel surveys from cities across the country, the baseline 
olefin level was reevaluated and set at 13.1 vol% for the purposes of 
determining cost-effectiveness.
    Although the standards require reductions for baseline vehicles 
relative to the emissions from the statutory baseline fuel, the cost-
effectiveness of a given fuel parameter control is measured based on 
actual, i.e., in-use emission reductions. For this reason, EPA 
determined the cost-effectiveness of fuel parameter changes relative to 
the incremental in-use emissions. The baseline in-use emissions were 
determined for 2003, a typical post-1999 year, using MOBILE5a with 
enhanced inspection and maintenance (I/M), as discussed in section 
IV.22 Exhaust and evaporative percent reductions for in-use 
emissions are determined separately by applying the percent reduction 
in emissions predicted by the complex model to the in-use emissions, 
and then totalled to get total in-use emissions reductions. The cost, 
emissions reductions, and cost-effectiveness of incremental changes in 
fuel parameters for Phase II RFG is calculated relative to Phase I RFG.
---------------------------------------------------------------------------

    \2\2Following the precedent set in the proposal, the in-use 
baseline for VOC Control Region 1 areas included an RVP of 7.8 psi. 
The standards set today are based on reductions relative to the 
statutory baseline fuel with an RVP of 8.7 psi, however.
---------------------------------------------------------------------------

    To determine the cost-effectiveness of the toxics standard, EPA 
employed the convention of basing cost-effectiveness on the number of 
cancer incidences avoided. The number of cancer incidences avoided is 
determined based on the reduction in emissions of each regulated air 
toxic. The complex model was used to calculate the annual reduction in 
both exhaust and evaporative emissions of each toxic for each fuel 
reformulation. Each toxic emission has a different unit risk factor, 
defined as the number of cancer incidences per year per gram-per-mile-
emission per person. Therefore, the emissions of each toxic pollutant 
were converted to an estimate of annual cancer incidences using the 
risk factor for that pollutant and the population of the participating 
reformulated gasoline areas. The total cancer incidences resulting from 
the total toxics emissions were then calculated by summing the cancer 
incidences for the individual toxics.
    d. Cost-effectiveness. The costs and emissions reductions for each 
parameter change are combined to determine the incremental cost-
effectiveness ($/ton) of each level of control, assigning all of the 
costs to the control of the pollutant of concern (VOC or NOX). 
Several comments were received regarding this method of establishing 
cost-effectiveness. One comment suggested that refiners are likely to 
reduce parameters to levels lower than the mandated limits to ensure 
compliance with the standards. Thus it was suggested that the cost 
analysis should be based on a marginal increase in the standard to 
determine the true cost-effectiveness of the program. EPA's cost-
effectiveness analysis is inherently an averaging analysis, however, 
since the cost estimates are based on the responses of average regional 
refineries to changes in fuel composition. Averaging allows refiners to 
be high or low for any batch of fuel, as long as their average meets 
the standard over the course of the entire compliance period. 
Measurement error goes both above and below the true values on any 
given batch of fuel, but should average zero over the course of many 
batches. As a result, there is no need for a compliance margin in 
setting an averaging standard.
    EPA proposed a range of VOC and NOX emission reduction 
standards based, in part, on two possible benchmarks for cost-
effectiveness, $5,000/ton and 10,000/ton.23 Several commenters 
stated that $5,000/ton was most appropriate, particularly in light of 
the inaccuracies in the cost analysis. Some commenters believed that 
$5,000/ton was too high compared to alternate control strategies, while 
others stated that this was reasonable compared to other strategies 
currently required.
---------------------------------------------------------------------------

    \2\3As discussed later, EPA considered a number of issues, 
including flexibility of refiners and burden to the industry, in 
addition to cost-effectiveness when setting the Phase II RFG 
standards.
---------------------------------------------------------------------------

    Upon review of the costs of other VOC and NOX control programs 
(see subsections C.1 and C.2 below), EPA believes that a cost-
effectiveness benchmark of $10,000/ton is too high at this point in 
time and that a cost-effectiveness of approximately $5,000/ton is more 
appropriate for the Phase II VOC standard and the accompanying NOX 
standard. The standards presented today fall within this guideline.
    The cost-effectiveness of toxics control was similarly determined 
as the ratio of the total incremental cost for the incremental 
reduction in emissions to the total tons of toxics reduced. The cost-
effectiveness of toxics control was also calculated as the ratio of 
total costs to incremental reductions in cancer incidences. EPA's 
proposal did not include any benchmark limits for the cost-
effectiveness of toxics control, but did acknowledge that in most cases 
control above the statutory minimum was not cost-effective. This 
conclusion was supported by the comments received, and by the final 
analysis presented here.

C. Phase II Reformulated Gasoline Standards and NOX Standards for 
Reformulated Gasoline

    The following sections explain the development of the VOC standards 
for Phase II reformulated gasoline, and the NOX standards EPA is 
setting for gasoline sold in RFG areas after 1999. The final standards 
are summarized in subsection 3 below.
1. VOC Standards Development
    Table VI-1 shows the incremental fuel parameter control costs, 
emissions reductions, and cost-effectiveness calculated by EPA for use 
in setting the VOC emissions standards. The specific fuel parameter 
changes shown in the table are only examples; refiners may achieve the 
required standards by any combination of fuel component controls 
resulting in the required emissions performance. EPA received 
conflicting comments regarding which parameters would likely be 
controlled to meet the proposed standards in a cost effective manner. 
As demonstrated in the RIA, EPA has used all available information to 
determine which parameters can be controlled in a cost effective manner 
to achieve VOC emission reductions. 

     Table VI-1.--Fuel Parameter Control Costs and VOC Reductions\1\    
------------------------------------------------------------------------
                      Incremental                                       
   Fuel parameter        cost (     Cumulative  Incremental  Incremental
       control         cents/gal)   reduction    cost-eff.    to phase I
                                       (%)        ($/ton)      ($/ton)  
------------------------------------------------------------------------
Phase I--RVP: 8.0                                                       
 psi, Oxygen:                                                           
 2.1wt%, Benzene:                                                       
 0.95%:                                                                 
    RVP to 7.1 psi..         0.18         22.9          400          400
    RVP to 6.7 psi..         0.08         25.5          600          400
    Sulfur to 250                                                       
     ppm............         0.12      \2\26.1        3,700          600
    Sulfur to 160                                                       
     ppm............         0.56         27.1       11,000        1,300
    Sulfur to 138                                                       
     ppm............         0.24         27.4       19,000        1,600
    Sulfur to 100                                                       
     ppm............         0.52         27.8       24,000        2,300
    Olefins to 8.0                                                      
     vol%...........         0.78         26.2          (-)        3,700
    Aromatics to 20                                                     
     vol%...........         2.01         27.8       24,000        6,000
    Oxygen to 2.7                                                       
     vol%...........         0.61         28.2       28,000        6,600
    Olefins to 5.0                                                      
     vol%...........         2.77         27.4          (-)       11,000
    E300 to 88%.....         0.35         27.4       48,000       11,000
    E300 to 91%.....         2.01         27.5      198,000       14,000
    E200 to 44%.....         0.38         27.7       37,000       14,000
    E200 to 47%.....         1.32         28.4       36,000       15,000
    E200 to 50%.....         2.97         29.0       96,000      18,000 
------------------------------------------------------------------------
\1\Based on costs and emissions reductions for VOC control region 2     
  (northern areas). Assumes all costs allocated to VOC control.         
\2\RVP control down to 6.5 psi, the limit considered reasonable at this 
  point in time for driveability purposes, would increase this value to 
  27.2% at a similar cost-effectiveness level.                          

    As the information in the Table VI-1 shows, RVP control down to 6.7 
psi achieves virtually all of the VOC emission reductions that are 
achievable at less than $5,000 per incremental ton of VOC 
reduced.24 Sulfur can be reduced to a level of approximately 250 
ppm at an incremental cost-effectiveness of less than $5,000 per ton, 
gaining an additional 0.6% VOC reduction, to achieve a total reduction 
(on average) of 26.1%. RVP could also be reduced further to 6.5 psi, 
the level currently considered a reasonable limit for driveability 
purposes, to obtain an additional 1.1% reduction (for a total of 
27.2%). Incremental changes in fuel parameters other than RVP have only 
a marginal effect on VOC emissions and can be very costly; less than an 
additional one percent reduction would be achieved at a significantly 
higher incremental cost of over $10,000/ton VOC. In spite of the 
uncertainty in the cost estimates used, the level of VOC control that 
is cost effective is relatively insensitive to variations in cost due 
to the fact that anything other than RVP and the first increment of 
sulfur control causes the costs to escalate dramatically, making 
control of other parameters cost ineffective.
---------------------------------------------------------------------------

    \2\4Note that the cost of this level of reduction incremental to 
the emission reductions achieved by Phase I RFG is significantly 
less than $1,000/ton VOC.
---------------------------------------------------------------------------

    The cost-effectiveness of VOC control in Phase II RFG presented in 
Table VI-1 has been compared to the cost-effectiveness of other 
stationary and mobile source VOC control strategies. As summarized in 
the RIA, a review of the estimated cost-effectiveness of controlling 
VOC emissions from stationary sources yielded a wide range of values. 
Many of the existing VOC control strategies have minimal costs or even 
result in savings. However, a number of VOC control options have 
significant costs associated with them. For example, the estimated 
cost-effectiveness of reducing emissions from automobile and light 
truck coating operations in assembly plants is $1,000-4,000/ton VOC. 
Reducing emissions from the production of pneumatic rubber tires is 
estimated to cost between $150 and $18,800 per ton of VOC reduced, 
depending on the operation to which control is applied. Control of 
emissions from floating roof tanks used for storage of petroleum 
liquids can cost up to $3,700/ton VOC reduced. Reducing emissions from 
the production of high density polyethylene, polypropylene, and 
polystyrene resins can cost between $1,000 and $3,000/ton VOC reduced 
depending on the level of control.
    Control of VOC emissions from mobile sources similarly is estimated 
(see the RIA) to result in a wide range of cost-effectiveness values, 
depending on the type of program and level of control achieved. 
Enhanced inspection and maintenance (I/M) programs will cost between 
$900-1,700/ton VOC reduced, while basic I/M was estimated to cost 
$5,400/ton VOC.25 The Tier 1 standards for light duty vehicles 
(already implemented for the 1994 model year) were estimated to cost 
about $6,000/ton VOC.
---------------------------------------------------------------------------

    \2\5``Inspection/Maintenance Program Requirements,'' Final Rule, 
57 FR 52984, November 5, 1992.
---------------------------------------------------------------------------

2. NOX Standards Development
    While section 211(k)(2)(A) of the Act specifies that there be no 
net increase in NOX emissions (over baseline levels) resulting 
from the use of reformulated gasoline, both a National Research Council 
study26 and a study prepared for EPA27 have indicated that 
additional NOX reductions could significantly reduce ozone 
formation in many areas. Gasoline vehicles contributed 20-35% of total 
urban NOX inventories in 1990 and are expected to contribute 
similar amounts in 2000.28 As identified in subsection A.1 above, 
section 211(c) of the Act gives the Agency broad regulatory authority 
to regulate motor vehicle fuel quality if any emission product of such 
fuel causes or contributes to air pollution which may reasonably be 
anticipated to endanger public health or welfare. Based on the reports 
cited above, other EPA work in ambient ozone analysis, and the 
authority granted EPA under section 211(c), EPA proposed setting a 
NOX emission reduction standard in connection with the Phase II 
standards to further reduce ozone formation during the high ozone 
season.
---------------------------------------------------------------------------

    \2\6 ``Rethinking the Ozone Problem in Urban and Regional Air 
Pollution,'' National Research Council, December 18, 1991.
    \2\7 ``Modeling the Effects of Reformulated Gasolines on Ozone 
and Toxics Concentrations in the Baltimore and Houston Areas,'' 
prepared for EPA,OPPE,APB by Systems Applications International, 
September 30, 1992.
    \2\8While Tier I vehicles, which have lower NOX emissions 
than conventional vehicles, will be entering the fleet, they will 
have only had five years to displace older, dirtier cars by 2000. 
Anticipated growth in vehicle miles travelled will offset any 
emissions benefits gained from the use of cleaner cars.
---------------------------------------------------------------------------

    A number of aspects of the RFG program lead naturally to a focus on 
NOX control. First, Phase II RFG is focused on the worst ozone 
nonattainment areas. Second, these areas will be required to use VOC 
controlled Phase II RFG only during the time of the year when control 
is needed (the summer months). Third, special fuel distribution for RFG 
will already be in place in these areas; many of the costs of producing 
and distributing this new gasoline will have been incurred as a result 
of the Phase II program. Fourth, EPA has shown (in the RIA and the 
following sections) that gasoline can be refined cost-effectively to 
reduce NOX emissions.
    EPA sees little benefit in creating a second gasoline program, 
which would likely differ only slightly from RFG in the geographic 
areas affected, to control NOX emissions. A large segment of the 
industry is already making the changes necessary to comply with the 
Phase I RFG standards in 1998 relative to the statutory baseline for 
sulfur and olefin levels (and all other parameters defined). Therefore, 
many refiners will be assessing the need for sulfur and olefin control 
in the next few years to ensure they comply with the no NOX 
increase requirement of the Act. Promulgated separately, a NOX 
standard would require refiners to make changes to their refineries in 
addition to those already made to comply with Phase I RFG and the Phase 
II VOC and toxics standards, perhaps making some of the original 
refinery changes obsolete. By enacting a NOX emissions reductions 
program at this time EPA hopes to avoid this concern. EPA believes that 
in locations where reformulated gasoline is found necessary to reduce 
the formation of ozone, a NOX standard is appropriate as well, as 
discussed below and in Section VI of the RIA.
    The Agency received many comments about the proposed NOX 
standards. Some commenters claimed it was counter to the regulatory 
negotiation agreement. This concern has been addressed in section A 
above. Others felt that NOX control should be considered on a 
local basis to meet local needs and thus should not be part of a 
national fuel program. Another stated that states should have to 
demonstrate the need for mobile source NOX control before EPA 
required it. Some commenters supported NOX control based on the 
cost-effectiveness analysis presented in the proposal because of the 
similarity with the costs of other current NOX control programs. 
One comment suggested that EPA control NOX by eliminating the 
oxygen requirement using the authority granted in section 211(k)(2)(A). 
It was also questioned whether EPA had satisfied the requirements to 
use the authority granted in section 211(c) regarding the supporting 
information presented in the proposal. The remainder of this section 
presents EPA's response to these concerns; additional detail may be 
found in the RIA.
    a. Scientific justification for NOX control. As discussed in 
the RIA, a recent study by the National Research Council (NRC) 
indicated that VOC control alone is of minimal benefit to ozone 
nonattainment areas such as Houston which have high VOC to NOX 
ratios in the ambient air.29 The NRC study and work by EPA30 
and others31 have also indicated that NOX control is an 
effective ozone control strategy for the northeast (including New York-
Connecticut and Boston-Maine) as well as the Lake Michigan region 
(Milwaukee, Chicago, and Muskegon). In general, many studies have shown 
that NOX control alone may be helpful in achieving ozone 
reductions in some areas, though not necessarily in all areas, again 
depending on the VOC to NOX ratios. Reductions in emissions of 
both VOC and NOX should benefit all areas, however. Those areas 
that do not benefit from the reduction in NOX emissions should 
benefit from the large reduction in VOC emissions that will be achieved 
by Phase II RFG.
---------------------------------------------------------------------------

    \2\9National Research Council, Rethinking the Ozone Problem in 
Urban and Regional Air Pollution, National Academy Press, 
Washington, D.C., 1991.
    \3\0U.S. EPA, Regional Ozone Modelling for Northeast Transport 
(ROMNET), EPA Report 450/4-91-002a, June 1991.
    \3\1See the RIA for additional references.
---------------------------------------------------------------------------

    There are also non-ozone benefits of NOX control, such as 
reductions in emissions leading to acid rain formation, reductions in 
toxic nitrated polycyclic aromatic compounds, lower secondary airborne 
particulate (i.e. ammonium nitrate) formation, reduced nitrate 
deposition from rain, improved visibility, and lower levels of nitrogen 
dioxide. A complete discussion of these benefits can be found in the 
RIA. A NOX standard also should effectively protect against an 
increase in the olefin content of the fuel, reducing concern over a 
possible increase in the reactivity of vehicle emissions.
    b. Consideration of section 202 motor vehicle controls. Before 
controlling or prohibiting a fuel or fuel additive under section 
211(c)(1)(A), the Administrator must consider ``other technologically 
or economically feasible means of achieving emission standards under 
section [202].'' This has been interpreted as requiring consideration 
of regulation through motor vehicle standards under section 202 prior 
to regulation of fuels or fuel additives under section 211(c)(1)(A) 
[Ethyl Corp. v. Environmental Prot. Agcy., 541 F.2d 1, 32 (D.C. Cir. 
1976)]. This does not establish a mandatory preference for vehicle 
controls over fuel controls, but instead calls for the good faith 
consideration of motor vehicle standards before imposition of fuel 
controls [541 F.2d at 32 n.66]. This reflects Congress' recognition 
that fuel controls under section 211(c)(1)(A) might logically involve 
controls on fuel composition itself, while vehicle standards under 
section 202 are generally performance standards, regulating vehicle 
emissions and not the design or structure of the vehicle. Fuel controls 
might therefore lead to greater government involvement in the 
regulation of the manufacturing process than would be expected from 
vehicle controls [541 F.2d at 11 n.13].
    Congress addressed this concern by requiring agency 
``consideration'' of vehicle standards under section 202 before 
imposition of fuel controls under section 211(c)(1)(A). It is important 
to note that the Administrator must in good faith consider such vehicle 
controls, but retains full discretion in deciding whether to adopt 
either fuel or vehicle controls, or both [541 F.2d at 32 n.66].
    In evaluating motor vehicle controls under section 202 in this 
context, the first major point to consider is that EPA has already 
imposed more stringent NOX control standards on motor vehicles. 
The Tier 1 standards for light-duty motor vehicles and trucks require 
reductions in light-duty motor vehicle NOX emissions starting with 
model year 1994, with a percentage phase-in of the more stringent Tier 
1 standards until they apply to all new model year 1996 and later 
light-duty vehicles and trucks. These vehicles are also required to 
meet in-use standards.32 For heavy-duty vehicles, EPA recently 
reduced the NOX standard to 4 g/bhp-hr, starting with model year 
1998 [58 FR 15781, March 24, 1993]
---------------------------------------------------------------------------

    \3\256 FR 25724, June 5, 1991. Also, note that the Tier 1 
standards apply to light-duty trucks with a loaded vehicle weight 
rating of 3,750 lbs. or less.
---------------------------------------------------------------------------

    While these motor vehicle and motor vehicle engine controls are 
expected to reduce mobile source emissions of NOX, this result is 
limited by certain basic facts. First, the standards only apply to new 
motor vehicles and engines. It will therefore take several years after 
the first model year of the standards before vehicles and engines 
certified to these standards will make up a significant portion of the 
motor vehicle fleet.33 In addition, it is expected that emissions 
reductions based on the reduction in the NOX standard will be 
offset to a significant extent by an increase, over time, in total 
vehicle miles travelled.
---------------------------------------------------------------------------

    \3\3As supported by the MOBILE5a model, 58 FR 29409, May 20, 
1993.
---------------------------------------------------------------------------

    In addition to motor vehicle controls under section 202, EPA has 
recently adopted or proposed other controls aimed at in-use NOX 
emissions from mobile sources. The enhanced inspection and maintenance 
(I/M) rules call for use of these more stringent I/M procedures 
starting with 1996 [57 FR 52950, November 5, 1992]. EPA has also 
proposed standards that would limit NOX emissions from new large 
horsepower diesel non-road engines, pursuant to section 213 of the Act 
[58 FR 28809, May 17, 1993]. While enhanced I/M programs will directly 
affect the motor vehicle fleet, the non-road engine regulations are 
similar to the motor vehicle regulations under section 202 in that they 
would apply to new non-road engines only, and therefore involve a 
certain time before a significant portion of this category of non-road 
engines is replaced by new engines certified to meet the NOX 
standards.
    Additional mobile source controls, whether under section 202 or 
under other authority such as described above, may well be cost 
effective and reasonable options that EPA might decide to adopt. 
However, there are certain limitations imposed by Congress on adoption 
of more stringent standards (``Tier 2 standards''). For example, 
Congress spelled out when and under what conditions EPA may promulgate 
more stringent NOX standards for light-duty vehicles and trucks. 
Congress required that EPA conduct a study on whether more stringent 
standards for light-duty vehicles and trucks should be adopted, and 
report back to Congress no later than June 1, 1997 [section 202(i) (1), 
(2)]. Based on the study EPA must conduct a rulemaking to determine 
whether there is a need for such further reductions, whether the 
technology will be available for such reductions, and whether further 
reductions in emissions from such vehicles will be cost effective. If 
these determinations are made in the affirmative, then EPA would 
proceed to promulgate emissions standards that are more stringent than 
the Tier 1 standards [section 202(i)(3)(C)]. If EPA does promulgate 
more stringent standards, they may not take effect any earlier than 
model year 2004, and no later than model year 2006.
    It is clear from this that EPA has not, at this time, completed the 
lengthy process for determining whether or not more stringent standards 
should be established for light-duty vehicles and trucks under section 
202(i). Congress established a detailed provision spelling out the 
procedures to follow and the substantive determinations that must be 
made before such controls could be adopted. There is no indication, and 
EPA does not believe, that these mandated procedures and criteria 
preclude the exercise of discretion under section 211(c)(1)(A) prior to 
completion of the rulemaking under section 202(i). Congress required 
that EPA consider motor vehicle controls, but did not establish a 
mandatory preference for such controls and did not preclude the 
adoption of fuel controls prior to a decision on Tier 2 motor vehicle 
standards.
    In any case, it is clear that a decision to impose more stringent 
NOX standards for light-duty vehicles and trucks under section 
202(i) could not take effect prior to model year 2004. It would then 
take several years before a significant portion of the in-use fleet 
would include vehicles or trucks certified to a NOX standard more 
stringent than the Tier 1 standard. A similar situation would apply to 
a more stringent NOX standard for heavy-duty engines. The 
mandatory leadtime and stability provision of section 202(a)(3)(C) 
would preclude imposition of more stringent NOX standards for 
heavy-duty engines until model year 2001 at the earliest. It would 
again take several years before a significant portion of the in-use 
heavy-duty fleet contained engines certified to a more stringent 
NOX standard. For non-road engines and vehicles, EPA expects to 
continue to explore NOX controls. But as with motor vehicles, any 
new or more stringent NOX standards will only apply to new non-
road engines, after providing a reasonable period for leadtime. The 
effect on in-use emissions is delayed based on the time needed before 
new non-road engines replace earlier models.
    Given these circumstances, there are several important reasons why 
promulgation of a NOX reduction standard for reformulated gasoline 
is important, whether or not additional vehicle or engine controls are 
later adopted by the Agency. First, emissions reductions from the 
NOX performance standard would start as soon as the standard is 
applicable, with no delay based on fleet turnover time. Significant 
NOX emission reductions would be achieved right away, in the 
summer of 2000, while more stringent light-duty or heavy-duty standards 
would not be expected to significantly affect in-use emissions until 
much later in that decade. Second, a NOX reduction standard for 
reformulated gasoline would act to reduce emissions from all mobile 
sources that use gasoline, whether on-road or off-road, while section 
202 or section 213 standards only act to limit emissions from new 
engines or vehicles in that specific category of mobile sources. Third, 
this fuel control is specifically aimed at areas of the country that 
are in nonattainment for ozone, and is limited in time to that part of 
the year when ozone is of most concern. Vehicle or engine controls, in 
contrast, apply to all new engines or vehicles, wherever they are used, 
throughout the year. This fuel control thus allows a more narrow 
regulatory solution aimed at the specific geographical areas and time 
periods when control is needed. Fourth, the expected increase in 
vehicle miles travelled over time leads EPA to believe that this fuel 
control is needed to continue to achieve the in-use NOX emission 
reductions necessary for many areas of the country to reach attainment 
for ozone. Finally, the NOX fuel standard adopted here minimizes 
any concern there might be that a fuel control would tend to interfere 
in the production process by directing refiners on how to make their 
product. The NOX standard is not a fuel recipe, but instead 
establishes a performance standard, leaving refiners free to produce 
their gasoline in any way that achieves the desired reductions.
    EPA is not at this time determining whether additional vehicle or 
engine NOX controls should be adopted under section 202 or any 
other provision of the Act. Instead, based on all of the above, EPA 
believes that a NOX reduction standard for reformulated gasoline 
under section 211(c)(1)(A) is an appropriate exercise of discretion, 
whether or not the agency imposes additional vehicle or engine NOX 
controls in the future.
    c. Cost-effectiveness of NOX control in RFG. EPA has evaluated 
the cost-effectiveness of NOX control using the same costs that 
were used in establishing the standard for VOC control. The results are 
summarized in Table VI-2 below. The table indicates that sulfur is the 
only fuel parameter that results in significant NOX reductions at 
a reasonable cost. Changes in fuel parameters other than sulfur have 
only a small effect on NOX emissions at significantly higher 
costs, with the possible exception of olefin control (which would 
increase VOC at the same time it reduced NOX). A NOX 
reduction of approximately 6.8% could be achieved with sulfur control 
down to approximately 138 ppm at a reasonable cost, whether compared on 
the basis of the cost of the last increment of reduction (5.8% to 6.8% 
NOX) or the overall cost incremental to Phase I RFG reductions. 

    Table VI-2.--Fuel Parameter Control Costs and NOX Reductions\1\     
------------------------------------------------------------------------
                       Incremental                                      
    Fuel parameter        cost (    Cumulative  Incremental  Incremental
       control         cents/gal)    reduction   cost-eff.    to phase I
                                    (percent)     ($/ton)    ($/ton)\2\ 
------------------------------------------------------------------------
Phase I:                                                                
    RVP: 8.0 psi,                                                       
     Oxygen: 2.1wt                                                      
     percent,                                                           
     Benzene: 0.95                                                      
     percent.........                                                   
    RVP to 6.7 psi...  ...........        0.4                           
    Sulfur to 250 ppm        0.12         2.4        1,300        3,200 
    Sulfur to 160 ppm        0.56         5.8        3,700        3,500 
    Sulfur to 138 ppm        0.24         6.8        5,200        3,700 
    Sulfur to 100 ppm        0.52         8.7        6,200        4,200 
    Olefins to 8.0                                                      
     vol percent.....        0.78        10.8        8,000        5,000 
    Aromatics to 20                                                     
     vol percent.....        2.01        11.9       40,000        8,200 
    Oxygen to 2.7 vol                                                   
     percent.........        0.61        12.5       25,000        8,900 
    Olefins to 5.0                                                      
     vol percent.....        2.77        14.1       37,000       12,000 
    E300 to 88                                                          
     percent.........        0.35        14.1          (-)       13,000 
    E300 to 91                                                          
     percent.........        2.01        14.2      820,000       16,000 
    E200 to 44                                                          
     percent.........        0.38        13.9          (-)       17,000 
    E200 to 47                                                          
     percent.........        1.32        13.7          (-)       19,000 
    E200 to 50                                                          
     percent.........        2.97        13.5          (-)      24,000  
------------------------------------------------------------------------
\1\Based on costs and emissions reductions for VOC control region 2     
  (northern areas). Assumes all costs allocated to NOX control. Cost    
  effectiveness values will be slightly lower if credit given for the   
  VOC reductions that also result with some of the fuel changes.        
\2\NOX cost effectiveness incremental to a Phase II VOC standard would  
  be slightly lower, especially for the first few increments.           

    A NOX emissions reduction of 6.8% would be slightly less than 
half of that achieved from California Phase II reformulated gasoline, 
since California requires sulfur reduction to approximately 30 
ppm,34 aromatics reduction to 22 vol%, olefins reduction to 4 
vol%, and control of fuel distillation parameters.35 However, the 
cost-effectiveness of producing a fuel with the requirements of 
California Phase II RFG in a national program would be extremely poor 
(roughly an order of magnitude higher) relative to that of the 
standards being set today.
---------------------------------------------------------------------------

    \3\4All values based on the averaging standard.
    \3\5Based on the same methodology used to determine the 7.0% 
NOX reduction for federal RFG (using the complex model), 
California Phase II RFG is estimated to achieve a NOX reduction 
of about 14.6%.
---------------------------------------------------------------------------

    d. Cost-effectiveness of other NOX control strategies. The 
cost-effectiveness of a 6.8% NOX standard has been compared to the 
cost-effectiveness of other existing and planned mobile and stationary 
source NOX control programs. The Tier 1 emissions standards for 
light duty vehicles (already implemented for the 1994 model year) 
described above in 2.b will incur an estimated incremental cost of 
$2,000-6,000/ton NOX if credit is only given for those emission 
reductions achieved in ozone nonattainment areas (to allow direct 
comparison with reformulated gasoline). Increasing the stringency of 
the NOX cutpoint in enhanced inspection and maintenance programs 
(in effect, causing a greater number of vehicles to fail the test and 
incur repair costs) is estimated to have a cost-effectiveness of 
$4,000-8,000/ton. Achieving the Tier 2 mobile source NOX standards 
(should EPA determine that such standards are necessary to meet air 
quality requirements) are likely to cost more than $10,000/ton of 
NOX reduced.
    Certain NOX controls for heavy-duty highway and nonroad 
vehicles are likely to be as or more cost effective as a 6.8% NOX 
reduction standard. EPA is in the process of developing and studying 
such controls. However, as discussed in subsection 2.b, heavy-duty 
NOX controls cannot be implemented without mandatory leadtime 
provisions, and thus the benefits of these controls will not be 
realized for many years beyond implementation of the Phase II RFG 
standards. In addition, all heavy-duty mobile source NOX control 
strategies that have not yet been implemented or are not already under 
consideration are likely to be very costly. NOX control combined 
with the reformulated gasoline program is very reasonable by contrast.
    The comparative cost-effectiveness to stationary source NOX 
emission controls is based on control strategies suggested for utility 
boilers.36 In ozone nonattainment areas, standards are being 
considered that will require controls more stringent than suggested by 
reasonably achievable control technology (RACT) standards. The RACT 
standards will likely be met through the use of low NOX burner 
technology. This technology has a relatively low cost-effectiveness at 
up to $1,000/ton, but the achievable emissions reduction is limited. In 
order to attain the required level of control for utilities to meet the 
ozone air quality standard in many areas, additional controls will 
likely be required, especially by the year 2000. One of the likely 
strategies utilized will be selective catalytic reduction (SCR) which 
is estimated to cost $3,000-$10,000/ton NOX.
---------------------------------------------------------------------------

    \3\6``Evaluation and Costing of NOX Controls for Existing 
Utility Boilers in the NESCAUM Region''; Draft Report prepared by 
Acurex Corp., prepared for Bill Neuffer, OAQPS, U.S. EPA, October 
1992.
---------------------------------------------------------------------------

3. Final VOC Standards and NOX Standards
    To reduce the cost to the industry of complying with the Phase I 
and Phase II RFG standards, EPA had proposed granting refiners the 
option of meeting the VOC and the air toxics emission standards on an 
averaging basis rather than requiring compliance on a per gallon basis. 
However, the NOX emissions standards had to be met on a per gallon 
basis rather than on an average basis.
    Several comments received on the NOX standard expressed a 
desire for the allowance of NOX averaging as well as a per gallon 
standard. According to these comments NOX averaging would provide 
greater flexibility to refiners, and was consistent with the Reg-Neg 
agreement. One comment stated that NOX averaging would not cause 
air quality concerns, while a per gallon NOX standard (even at no 
NOX increase) would impose substantial constraints on VOC.
    NOX averaging would provide the industry with greater 
flexibility in meeting the NOX standard for Phase II RFG. In 
addition, the cost-effectiveness analysis is inherently based on 
averaging (since the costs are derived based on regional refinery 
models). Hence, EPA has elected to allow both a per gallon and an 
averaging standard for NOX emissions under the Phase II RFG 
program. As discussed in section VII, the Phase II averaging standard 
for NOX is set 1.3 percentage points more stringent than the per 
gallon standard (slightly smaller than the increment for VOC and air 
toxics). A minimum per gallon standard (under averaging) will be set at 
4 percentage points below the averaging standard, following the 
precedent set with the VOC standard for Phase I RFG.
    Based on all of the factors discussed above, as well as the results 
of the regulatory impact analysis, EPA today is setting VOC reduction 
standards for Phase II reformulated gasoline and concurrent NOX 
reduction standards for gasoline sold in areas participating in the RFG 
program beginning in the year 2000. (The toxics standard is discussed 
below in subsection 4.) The standards are shown in Table VI-3 below. 
The combination of fuel parameters on which the standards are based is 
just one of many fuel formulations which could be used to achieve the 
standards. From EPA's analysis of cost-effectiveness, however, it is 
clear that RVP control and sulfur control are expected to be the basic 
fuel parameter changes that refiners will rely on to comply with these 
standards. At the same time, it must be stressed that today's standards 
are performance standards which may be met by the refiner's choice of 
fuel parameter controls; EPA is not establishing specifications for 
fuel composition. Specific issues concerning these final standards are 
discussed in the following sections. 

  Table VI-3.--VOC Standards for Phase II Reformulated Gasoline and NOX 
                           Reduction Standards                          
                    [Percent Reduction in Emissions]                    
------------------------------------------------------------------------
                                                       VOC        VOC   
               Controlled emission                   control    control 
                                                    region 1   region 2 
------------------------------------------------------------------------
VOC:                                                                    
    Per gallon....................................    \1\27.5       25.9
    Averaging.....................................       29.0       27.4
    Minimum.......................................       25.0       23.4
NOX:                                                                    
    Per gallon....................................        5.5        5.5
    Averaging.....................................        6.8        6.8
    Minimum.......................................        3.0       3.0 
------------------------------------------------------------------------
\1\Reductions relative to a base fuel with RVP at 7.8 psi on a per      
  gallon basis would be 17.2% for VOC and 5.3% for NOX.                 

    a. Flexibility for refiners. The VOC and NOX standards 
presented in Table VI-3 were determined assuming both controls were 
necessary. Were EPA not to set a NOX standard, there may be 
greater flexibility to further control RVP for the purposes of VOC 
control. As shown in Table VI-1, for the purposes of VOC control RVP to 
6.5 and sulfur to 250 ppm would achieve a reduction of 27.2% in VOC 
control region 2, at an incremental cost-effectiveness of $3,700/ton 
VOC (or less than $600/ton incremental to the Phase I reductions). This 
is nearly the same level of reduction achieved with RVP at 6.7 psi and 
sulfur reductions to 138 ppm under the combined VOC and NOX 
standards.
    Various comments questioned basing the VOC standard on a gasoline 
RVP of 6.5 psi, due to potential driveability problems with fuels at 
lower RVPs (which refiners will produce on occasion to meet the average 
standard). Commenters were concerned that the VOC standard would reduce 
the flexibility available to refiners by essentially requiring all RFG 
to have an RVP of 6.5 psi. As discussed previously, EPA currently 
believes that 6.5 psi RVP is a practical limit in the reduction of 
gasoline volatility, due to the lack of information at the present time 
to ascertain whether or not driveability problems exist below that 
level. In the absence of NOX control, EPA believes that adequate 
flexibility would still exist for refiners to meet a VOC performance 
standard based on the control of RVP down to 6.5 psi, since some 
flexibility still exists in adjusting sulfur and olefin levels. 
However, in the context of a NOX standard this flexibility is 
greatly reduced.
    A fuel meeting the combined requirements of 6.5 psi RVP and 138 ppm 
sulfur would achieve a VOC reduction of 28.4% (in VOC control region 2) 
and a NOX reduction of 6.9%. Standards based on this fuel 
formulation could severely restrict the flexibility for some refiners, 
and pose an undue burden on others. For example, refiners with various 
parameter levels above the statutory baseline would need additional VOC 
control to offset the VOC impact of these parameters. Under the above 
scenario, these refiners would be limited in achieving further RVP 
control, since the ability to further reduce RVP and sulfur and/or 
increase olefins would be limited. This would significantly increase 
the cost-effectiveness of the VOC control.
    Upon consideration of these concerns, among other issues, EPA 
decided to set a VOC standard derived based on a fuel RVP of 6.7 psi to 
allow refiners some flexibility to meet the performance-based VOC 
standard through control of RVP without the need to go below 6.5 psi. 
By setting a concurrent NOX standard based largely on additional 
sulfur control, which also achieves some small additional VOC 
reductions, refiners will not need to go as low as 6.5 psi to meet the 
equivalent level of VOC control. The cost-effectiveness of a 6.8% (on 
average) NOX reduction standard when credit is given for the 
additional level of VOC control obtained at this level of sulfur 
reduction is approximately $5,000/ton NOX reduced.
    b. Costs and emissions reductions. The overall cost of the Phase II 
reformulated gasoline VOC standards and NOX standards for Phase II 
RFG is approximately 1.2 cents per gallon (incremental to Phase I RFG). 
This value appears to be reasonable, as the less stringent Phase I 
reformulated gasoline cost is estimated to be about 3-5 cents per 
gallon, as discussed in section V. EPA does not expect non-production 
related costs, such as distribution costs, recordkeeping and reporting 
costs, etc., to increase relative to Phase I reformulated gasoline. A 
complete discussion of the development of these costs is found in the 
RIA.
    As a result of today's standards, VOC emissions will be reduced by 
about 10,000 tons in VOC control region 1 (southern) areas each summer 
and 32,000 tons in VOC control region 2 (northern) areas. In addition, 
southern areas will experience a reduction of about 8,300 tons NOX 
and northern areas will experience a reduction of 13,800 tons NOX. 
The emissions reductions experienced in southern areas are smaller than 
experienced in northern areas due to the fact that southern areas are 
already required to use fuels with lower Reid vapor pressures, and thus 
the emissions reduction benefits of RFG use in these areas is smaller.
    c. Compliance margin consideration. Several commenters expressed a 
desire for looser standards to account for compliance margins. The 
optional provision for averaging standards allows refiners to meet the 
standards in the manner which is most cost-effective for their refinery 
in exchange for meeting a standard that is considered at least or more 
stringent as the per gallon standard plus a compliance margin. The VOC 
and NOX reduction standards have both been based in part on a 
cost-effectiveness analysis that implicitly is based on an averaging 
standard. In that case, a compliance margin becomes much less relevant, 
if at all, because of the flexibility introduced through averaging.
    d. Local selection of VOC or VOC and NOX control. EPA 
requested comments on an option to allow nonattainment areas to select 
between either VOC control or combined VOC and NOX control, 
depending on the air quality needs of that area. A potential problem 
with this option is that it would require production of another type of 
reformulated gasoline in one or more grades. Distribution problems and 
complications already expected with implementation of the reformulated 
gasoline requirements could increase.
    Many commenters opposed this option, citing added costs and 
complications to the distribution system which would likely result. No 
commenters appeared to be strongly in favor of it. Hence, the Agency 
has chosen not to allow local selection of a VOC and/or NOX 
control program. The standards for VOC and NOX emissions will 
apply to all reformulated gasoline areas.
    e. Other options considered. EPA proposed37 and investigated 
several options for VOC standards. One proposed option was to set a VOC 
standard at the statutory level of 25% reduction; this standard could 
also be set higher based on the cost-effectiveness analysis. Also 
mentioned in the NPRM was the option to relax the VOC standard if a 
NOX standard was promulgated to allow refiners more flexibility in 
meeting both standards. Finally, EPA proposed granting refiners the 
option to trade off VOC and NOX control within fixed limits on 
either standard.
---------------------------------------------------------------------------

    \3\7As corrected in 58 FR 17175, Thursday, April 1, 1993.
---------------------------------------------------------------------------

    EPA determined that setting only a 25% reduction VOC standard (with 
a requirement of no NOX increase) would provide minimal NOX 
reductions and marginal VOC benefits to southern (VOC Control Region 1) 
areas which will already use lower RVP fuel than northern areas under 
Phase I. A higher VOC standard selected based on a cost-effectiveness 
benchmark of about $5,000/ton would get somewhat greater NOX 
reductions and some additional VOC reductions in southern areas.
    EPA has set the VOC standard based on a level of reduction that 
would allow flexibility to refiners and would not be too economically 
burdensome. Since a NOX standard is being set concurrently, EPA 
set the VOC standard based on a slightly more relaxed RVP than might 
have been used if only a VOC standard were implemented, as discussed 
above in subsection a. One comment on the proposal strongly opposed 
lessening the maximum achievable level of VOC reduction to achieve 
NOX reductions. As discussed above, however, roughly the same 
level of VOC reduction is being achieved with both a NOX standard 
and a VOC standard (basing the standard on a fuel with 138 ppm sulfur 
and an RVP of 6.7 psi) as would be achieved if only VOC control were 
required (basing the standard on a fuel RVP of 6.5 psi and a sulfur 
level of 250 ppm).
    The final option proposed by EPA was to set a combined VOC and 
NOX standard and allow refiners flexibility in controlling 
emissions of either. As discussed in subsection C.2 above, EPA believes 
it is important to achieve both VOC and NOX control. VOC control 
alone would not provide significant ozone reduction benefits in all 
areas using RFG. The option of allowing refiners to meet a combined VOC 
and NOX standard would have likely resulted in VOC control 
(primarily through RVP reductions) with minimal NOX control. 
Refiners would have had a strong incentive to augment the complex model 
through vehicle testing and push RVP well below the 6.5 psi level in 
order to avoid sulfur control (for NOX reductions), since RVP 
control is much less costly. As mentioned previously, EPA has 
significant concerns about driveability problems with fuels with RVPs 
lower than 6.5 psi. Since refiners would be limited in their ability to 
cost effectively achieve the combined standards, the reductions 
achieved through this type of program would be in question. Hence, EPA 
has decided not to implement a combined VOC and NOX standard. No 
significant comments were received on this option.
4. Toxics Standard
    The statute sets the minimum Phase II standard for toxics reduction 
at 25%, although EPA has the authority to reduce this to no lower than 
20% ``based on technological feasibility, considering cost.''38 
EPA proposed both levels of reductions as options for the toxics 
standard. EPA has looked at the technology required to attain a 25% 
toxics standard, and the cost of implementing that technology. EPA 
expects that the technology implemented by refiners to comply with the 
required VOC and NOX reductions will result on average in a 26% 
reduction in annual toxics at reasonable costs, as discussed earlier. 
For certain refiners with higher baseline levels of various parameters, 
however, EPA expects that compliance with the VOC and NOX 
standards will not automatically lead to compliance with a 25% toxics 
standard. For these refiners, additional toxics control will typically 
require further benzene reduction or aromatics reduction (if octane can 
be maintained). Benzene reductions would impact only emissions of 
benzene, not 1,3-butadiene, which has been shown to be of greater 
cancer-causing risk to the public than the other air toxics.39 
(The statutory requirements of section 211(k) requires a focus on 
reductions in mass emissions of air toxics, not on a reduction in 
cancer risk, and therefore does not permit EPA to set the standard 
based on cancer risk.) Implementation of the benzene and/or aromatics 
reduction technology will be expensive and will raise their costs of 
production, putting refiners facing this situation at a competitive 
disadvantage to those refiners who comply with the toxics standard 
``for free'' based on their compliance with the VOC and NOX 
standards. In addition, a requirement of additional toxics reductions 
may also limit refiners' flexibility in producing reformulated 
gasoline.
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    \3\8The toxics standard is a requirement for an average percent 
reduction over the entire year, not solely in the summer (high 
ozone) season.
    \3\9``Motor-Vehicle Related Air Toxics Study,'' EPA Report 420-
R-93-005, April 1993.
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    EPA has considered two additional factors in considering the 
feasibility of requiring this subset of refiners to pay the costs of 
implementing additional toxics control technology in order to meet a 
25% standard. First, even if the toxics standard is reduced to 20%, EPA 
believes that the average toxics reduction across all refiners will 
still be above 25% based upon the fuel changes used to comply with the 
VOC and NOX standards. Second, the additional toxics control 
required by this subset of refiners results in very high cost per 
cancer incidence avoided. The main control strategies for toxics, 
benzene and aromatics reductions, are very expensive, in excess of $100 
million/CI. This is well beyond the $1-10 million/CI which the Agency 
believes to be achievable through other programs. Even though a 25% 
toxics standard is technologically feasible, the unique circumstances 
discussed above raise questions about the increased cost to this subset 
of refiners of implementing additional toxics reduction technology.
    Based on these concerns regarding the costs of implementing toxics 
control technology, EPA is setting the toxics standard for Phase II RFG 
in both VOC control regions at 20%. There was general support in the 
comments received for the fact that the cost-effectiveness of toxics 
control beyond a 20% reduction is questionable. No substantive comments 
were received opposing the option of setting the standard at the 
minimum 20% reduction.
    Based on today's standards and the analysis summarized in the RIA, 
about 630 tons of toxics will be reduced in VOC control region 2 each 
summer and 370 tons of toxics in VOC control region 1. Emissions of all 
toxics except formaldehyde will be reduced. As a result of these 
emissions reductions, approximately 3-4 cancer incidences will be 
avoided annually nationwide (incremental to Phase I).

VII. Enforcement

    Section 211(k) of the Clean Air Act requires, beginning January 1, 
1995, that the gasoline sold or dispensed in certain ozone 
nonattainment areas must be certified as reformulated. Gasoline that is 
not certified as reformulated is classified as conventional gasoline 
and must be sold outside these nonattainment areas. Under the 
enforcement scheme promulgated today, refiners and importers will be 
required to designate all gasoline as either reformulated or 
conventional. Gasoline designated as reformulated must meet the 
standards for reformulated gasoline, and conventional gasoline must 
meet the anti-dumping standards for conventional gasoline. In addition, 
refiners and importers will be required to prepare product transfer 
documents for all gasoline produced or imported, that identify the 
gasoline as reformulated or conventional and specify restrictions as to 
the time and place where the gasoline may be used.
    Parties downstream of refiners and importers that transport, store, 
or dispense gasoline are responsible for ensuring that only 
reformulated gasoline is used in reformulated gasoline covered areas, 
and that reformulated gasoline is used at a time and place consistent 
with the time and place of use restrictions recited in the product 
transfer documents. In addition, downstream parties are responsible for 
ensuring that reformulated gasoline does not violate the per-gallon 
minimum and maximum standards, discussed more fully below.
    During calendar years 1995 through 1997, refiners and importers may 
certify reformulated gasoline pursuant to either the Phase I simple 
model standards, or the Phase I complex model (early use) standards. 
This election must be made separately for each refinery on a calendar 
year basis. During calendar years 1998 and 1999, all reformulated 
gasoline must meet the Phase I complex model standards, and beginning 
in 2000, all reformulated gasoline must meet the Phase II complex model 
standards.
    The final rule establishes reformulated gasoline standards for 
oxygen, benzene, toxics emissions performance, and heavy metals under 
all models. Standards for RVP, sulfur, T-90, and olefins are included 
only under the simple model, and standards for VOC and NOX 
emissions performance are included only under the Phase I and II 
complex models.
    A refiner or importer electing early use of the complex model 
during 1995, 1996, or 1997 must determine individual refinery or 
importer performance standards for VOC, toxics, and NOX. These 
standards are determined by evaluating the following slate of fuel 
parameter values in the Phase I complex model: The simple model 
requirements, per section 80.41(a) or (b), for benzene, RVP and oxygen; 
the aromatics value necessary to meet the simple model toxics standard 
using these values for benzene, RVP and oxygen; the refinery or 
importer individual baseline values for E-300, sulfur, and olefins; and 
the statutory summertime or wintertime baseline value for E-200.
    The percent reductions in VOC, toxics, and NOX emissions 
determined using the above fuel in the Phase I complex model are the 
reformulated gasoline standards for a refinery or importer electing 
early use of the complex model.
    Beginning in 1998, the Phase I reformulated gasoline VOC, toxics, 
and NOX standards for a refinery or importer are as specified in 
section 80.41 (c) and (d). As a result of the individual refinery or 
importer baselines under complex model early use, gasoline that is 
produced under this option at any specific refinery or imported by any 
specific importer, may not be fungibly mixed with gasoline that is 
produced at another refinery or imported by another importer. This 
segregation of early use complex model gasolines, and other segregation 
requirements, are discussed more fully below.
    Refiners and importers may elect to meet certain reformulated 
gasoline standards either on a per-gallon basis or on average. This 
election, which must be made separately for each parameter and 
separately for each calendar year, applies to all gasoline produced at 
a refinery by a refiner, or imported by an importer, during a calendar 
year. Refiners and importers cannot meet the standard for any single 
parameter on a per-gallon basis for certain batches and on average for 
other batches during any calendar year.
    A refiner or importer that opts for compliance on average must also 
meet requirements for gasoline quality surveys. Standards that may be 
met on average are RVP, oxygen, and benzene, and VOC, toxics, and 
NOX emissions performance.
    The purpose of the gasoline quality surveys is to ensure, for 
example, that RVP averaging by refiners or importers does not result in 
a covered area receiving reformulated gasoline that, on average over 
the covered area, has a higher RVP than would occur without such 
refiner or importer averaging. This applies for each parameter subject 
to refiner or importer averaging. In the event a gasoline quality 
survey reveals that the gasoline being used in a covered area does not 
meet the per-gallon standard for any regulated parameter, the per-
gallon maximum or minimum standard for that parameter is made more 
rigorous, and except in the case of oxygen the standard for average 
compliance is made more rigorous. With certain limited exceptions, 
these adjusted standards apply to all gasoline produced at each 
refinery that supplied the covered area with the failed survey during 
the year of the survey failure, or during any year the adjusted 
standards apply. These gasoline quality survey requirements also apply 
to oxygenate blenders that meet the oxygen standard on average.
    The final rule also includes other mechanisms to ensure that 
refiner or importer averaging will not result in a covered area 
receiving reformulated gasoline that, on average, is less 
``reformulated'' than would occur absent such refiner or importer 
averaging. To meet this goal, EPA established standards for average 
compliance that are more rigorous than the standards for per-gallon 
compliance, and established the per-gallon maximums and minimums that 
apply to gasoline meeting the averaged standards. These maximums and 
minimums limit the range of averaging for the averaged standards, and 
the more stringent averaged standards require refiners and importers to 
further reformulate their gasoline to meet these standards.
    Refiners and importers may meet the averaged standards for oxygen 
and benzene through the exchange of credits. Credits are generated as a 
result of a refiner producing, or an importer importing, gasoline that 
on average exceeds the averaged standards for oxygen or benzene over 
the averaging period. An oxygenate blender using the averaged oxygen 
standard may generate, or use, oxygen credits.
    The final rule specifies the manner in which credits must be used. 
Credits must be generated in the same averaging period as they are 
used--credits may not be banked for use in a later averaging period; 
all credit transfers must occur within fifteen days following the end 
of the averaging period in which they are generated; and only validly 
created credits may be used to achieve compliance.
    The final rule constrains the use of the averaged standard for 
oxygen, and the use of oxygen credits in certain circumstances. 
Reformulated gasoline subject to simple model standards that is 
designated for use in the high ozone season--VOC-controlled 
reformulated gasoline--must meet both the oxygen standard and the RVP 
standard separately during the VOC control period (discussed more fully 
below). Simple model VOC-controlled gasoline may not be averaged with 
simple model non-VOC-controlled gasoline to show compliance with the 
oxygen standard during the VOC control period. In addition, 
reformulated gasoline designated for use in cities subject to the 
requirements of the oxygenated fuels program during the oxygenated 
fuels program control period (or ``OPRG'' gasoline) may not be averaged 
together with gasoline not designated for this use for purposes of 
meeting the oxygen standard on average.40 As a result, only oxygen 
credits generated from VOC-controlled gasoline subject to simple model 
standards may be used to meet the separate oxygen standard for VOC-
controlled gasoline; and oxygen credits generated from OPRG gasoline 
may only be used to meet the oxygen standard for OPRG gasoline. The 
mechanisms used to ensure correct accounting under these oxygen 
averaging and credit constraints are discussed in a separate section 
below.
---------------------------------------------------------------------------

    \4\0The oxygenated fuels program refers to state programs 
established pursuant to Sec. 211(m) of the Act, involving wintertime 
use of oxygenated gasoline to control emissions of carbon monoxide.
---------------------------------------------------------------------------

    The final rule also includes provisions that regulate the manner in 
which oxygenates may be added downstream of the refinery or import 
facility within the reformulated gasoline program. Oxygenate may only 
be added to specially formulated reformulated gasoline blendstock 
intended for such downstream oxygenate blending (or ``RBOB''). If 
oxygenate were added to reformulated gasoline not specially formulated, 
in most cases the resulting gasoline would not meet the reformulated 
gasoline standards. Refiners and importers of RBOB are required to 
include in the RBOB product transfer documents the type and amount, or 
range of types and amounts, of oxygenate that may be blended with each 
particular RBOB. RBOB must be segregated from reformulated gasoline, 
and from other RBOB having different oxygenate requirements, to the 
point of oxygenate blending. Distributors may only dispense RBOB to 
registered oxygenate blenders. Oxygenate blenders may only blend the 
specified type and amount of oxygenate with any RBOB, and must meet the 
standard for oxygen for all RBOB dispensed to them.
    Refiners and importers are required to meet the reformulated 
gasoline standards for RBOB for all parameters other than oxygen, based 
on the properties of the reformulated gasoline that will be produced 
through blending the appropriate type and amount of oxygenate with the 
RBOB. As a result, if the incorrect type and/or amount of oxygenate is 
blended with the RBOB, the refiner or importer may fail to comply with 
the non-oxygen standards.
    In order to ensure that the non-oxygen standards for RBOB are met, 
refiners and importers may transfer RBOB only to oxygenate blenders 
with whom they have a first- or second-hand contractual relationship. 
This contract must include procedures intended to ensure proper 
performance of oxygenate blending. In addition, the refiner or importer 
must conduct a quality assurance program over the oxygenate blender's 
blending operation.
    These constraints on the transfer of RBOB do not apply if a refiner 
or importer designates the RBOB as suitable for blending with any 
oxygenate or with ethers only,41 and assumes that ethanol will be 
blended with ``any-oxygenate'' RBOB and MTBE will be blended with 
``ether-only'' RBOB. A refiner or importer using this blending 
assumption option further assumes that the volume of oxygenate blended 
will be that amount necessary for the resulting reformulated gasoline 
to have an oxygen content of 2.00 weight percent, or approximately 5.70 
volume percent in the case of ethanol, and approximately 10.80 volume 
percent in the case of MTBE. These oxygenate blending assumptions are 
discussed more fully below.
---------------------------------------------------------------------------

    \4\1The ethers include but are not limited to MTBE, TAME, and 
ETBE.
---------------------------------------------------------------------------

    In order to ensure that gasoline produced or imported as 
reformulated in fact meets the reformulated gasoline standards, 
refiners and importers are required to engage an independent laboratory 
to sample each batch of reformulated gasoline produced or imported, and 
to analyze up to ten percent of the samples collected. EPA will direct 
the independent laboratories as to which samples to analyze. Refiners 
producing gasoline using computer-controlled in-line blending may 
obtain a waiver from EPA and have the in-line blending records audited 
in lieu of the independent sampling and testing requirements. The 
independent sampling and testing requirement is discussed more fully 
below.
    Under the final rule, refiners, importers, and oxygenate blenders 
are required to keep specified records that relate to the production or 
importation of gasoline, sampling and testing of gasoline, credit 
transfers, and compliance calculations. All regulated parties are 
required to keep copies of product transfer documents, and records of 
any quality assurance sampling and testing performed.
    Refiners, importers, and oxygenate blenders are required to submit 
reports to EPA that contain information necessary to demonstrate that 
standards have been achieved either per-gallon or on average. The 
periods for reporting are calendar quarters (January through March, 
April through June, July through September and October through 
December). The quarterly reports are due on the last day of the second 
month following the end of the quarter.
    Quarterly reports consist of detailed information describing each 
batch of reformulated gasoline or RBOB produced or imported. Additional 
reporting requirements apply for refiners, importers, and oxygenate 
blenders who produce reformulated gasoline or RBOB which meets any of 
the applicable standards on average. RVP, VOC, and NOX averaging 
reports are submitted with the third quarterly report of a given year 
and cover the high ozone season averaging period. Oxygen, benzene and 
toxics averaging reports and credit transaction reports are submitted 
with the fourth quarterly report and cover the annual averaging period. 
Credit transaction and averaging reports are not required for 
reformulated gasoline or RBOB which meets all of the applicable 
standards on a per-gallon basis.
    Refiners, oxygenate blenders, and importers are required to 
register with EPA by November 1, 1994 or no later than three months in 
advance of the first date the party will produce or import reformulated 
gasoline, whichever is later. Registration information identifies the 
refiner, blender, or importer and any facilities at which reformulated 
gasoline or RBOB may be produced, and the independent laboratory that 
will be used to fulfill the independent analysis requirements. EPA will 
supply a registration number to each refiner, importer, and oxygenate 
blender, and a facility registration number for each refinery and 
oxygenate blending facility that is identified; these registration 
numbers must be used in all reports to EPA.
    The final rule includes a requirement that all refiners, importers, 
and oxygenate blenders must commission an annual review of the 
information contained in the reports to EPA, or an ``attest 
engagement.'' Attest engagements must be conducted either by a 
Certified Public Accountant, or by a Certified Internal Auditor, 
following procedures included in the final rule. The attest procedures 
are intended to ensure that all gasoline produced or imported is 
included in the reports for either reformulated gasoline or 
conventional gasoline; that product transfer documents are properly 
prepared; that the requirements for downstream oxygenate blending are 
met; and that in the case of a refiner using computer-controlled in-
line blending, that the blend records support the reported properties 
of the gasoline produced.
    All parties in the gasoline distribution system are required to 
segregate certain categories of reformulated gasoline from other 
categories. These segregation requirements result primarily from the 
time and place of use restrictions necessary for reformulated gasoline, 
and to a lesser extent are necessary for per-gallon minimums and 
maximums and gasoline quality surveys in covered areas. In summary 
form, the segregation requirements are the following.
    Gasoline subject to simple model standards may not be fungibly 
mixed with gasoline subject to complex model standards. In addition, 
gasoline produced at any refinery or imported by any importer that is 
subject to the complex model before 1998 must be segregated from 
complex model gasoline produced at any other refinery or imported by 
any other importer. These two segregation requirements, which are 
limited to the period 1995 through 1997, are necessary in order for 
per-gallon minimums and maximums and gasoline quality surveys to 
properly function.
    Only gasoline that is VOC-controlled may be used during the high 
ozone season, which requires the segregation of VOC-controlled and non-
VOC-controlled gasoline in advance of the high ozone season (other than 
to ``blend up'' storage tanks to the VOC-controlled standards). 
Similarly, only gasoline designated for VOC Control Region 1 may be 
sold in that region, which requires the segregation of VOC Control 
Region 1 gasoline from VOC Control Region 2 gasoline. In addition, VOC-
controlled gasoline produced with ethanol may not be mixed with VOC-
controlled gasoline produced using any other oxygenate during the 
period January 1 through September 15. These segregation requirements 
are necessary in order for VOC emission reductions to be achieved.
    Lastly, only gasoline designated as oxygenated fuels program 
reformulated gasoline (OPRG) may be sold in an oxygenated fuels program 
area during the oxygenated fuels control period, which requires the 
segregation of OPRG gasoline from non-OPRG gasoline in advance of any 
oxygenated fuels control period (other than to ``blend up'' storage 
tanks). This segregation requirement is necessary so that the extra 
oxygenate used in oxygenated fuels program cities does not, through 
averaging, result in non-oxygenate fuels program cities receiving less 
oxygen than is required under the Clean Air Act.
    The final rule establishes liability for a number of prohibited 
activities that may occur downstream of the refinery or importer, 
including the following: The sale, dispensation, transportation, or 
storage of conventional gasoline represented to be reformulated; the 
failure of reformulated gasoline to meet the minimum or maximum 
standards; and the use of reformulated gasoline in a manner 
inconsistent with the time and place of use restrictions recited in the 
product transfer documents. When such a violation is found, the 
following parties are presumed liable: The operator of the facility at 
which the violating gasoline is found, and each upstream party, other 
than carriers, that supplied any of the gasoline found to be in 
violation. In the case of a facility operating under the brand name of 
a refiner, that refiner is also presumed liable regardless of whether 
the refiner supplied any of the gasoline found in violation.
    A party presumed liable may establish an affirmative defense by 
showing that it did not cause the violation, that the party's product 
transfer documents were proper, and that the party carried out a 
quality assurance program to monitor the per-gallon minimum and maximum 
standards of the gasoline under the party's control.
    A more detailed description of the liability and defense provisions 
relating to carriers is included below.
    The final rule specifies the manner in which penalties will be 
determined for violations of the final rule. These penalty provisions 
include calculations of the number of days of violation, and 
presumptions regarding the properties of gasoline.
    The remainder of Section V of the preamble discusses major changes 
from the enforcement provisions that were proposed in the supplemental 
notice of proposed rulemaking published at 58 FR 11722 (February 26, 
1993). The following portion of this section also responds to a number 
of significant public comments on the enforcement provisions contained 
in the 1993 proposal. Responses to other significant comments EPA 
received are contained in a separate ``response to comments'' document 
that has been placed in the docket for this rulemaking.

A. California Enforcement Exemption

    In the February 26, 1993, notice of proposed rulemaking (NPRM), EPA 
proposed to exempt refiners, importers and blenders of ``California 
gasoline'' from certain enforcement provisions in the proposed federal 
reformulated gasoline regulations. The Agency generally proposed that 
``California gasoline'' would mean gasoline subject to the State of 
California's reformulated gasoline regulations that was either produced 
within the State or imported into the State from outside the United 
States.
    The proposed California enforcement exemptions were based on the 
Agency's comparison of the estimated emission reduction benefits of 
California's Phase 2 reformulated gasoline program with those 
anticipated from the federal phase I reformulated gasoline program, 
using the federal complex model proposed in the NPRM. The California 
Phase 2 program establishes standards for eight gasoline 
characteristics--sulfur, benzene, olefin, aromatic hydrocarbons, 
oxygen, RVP, T50 and T90--applicable starting March 1, 1996. EPA's 
analysis indicated that California Phase 2 gasoline will have a greater 
emission reduction benefit than federal reformulated gasoline. This 
analysis also indicated that, in the case of VOC, toxic and NOX 
emissions performance, California Phase 2 gasoline has a greater 
emissions performance reduction than federal phase I gasoline, compared 
to Clean Air Act base gasoline. EPA's review also indicated that the 
California oxygen ``flat limit'' of 1.8 to 2.2% will in practice be 
equivalent to the 2.0% minimum oxygen content required by the Act. See 
58 FR 11746-7 (February 26, 1993).
    The Agency proposed that, effective with the start of California's 
Phase 2 program, regulated parties would be exempt from meeting the 
enforcement requirements dealing with compliance surveys (section 
80.69), independent sampling and testing (section 80.70(c)), 
designation of gasoline (section 80.70(d)), marking of conventional 
gasoline (section 80.70(g)), downstream oxygenate blending (section 
80.72), record keeping (section 80.74), reporting (section 80.75), 
product transfer documents (section 80.77), and antidumping record 
keeping (section 80.105) and reporting (section 80.106).42 Between 
the January 1, 1995, start of the federal program and the March 1, 
1996, start of the California Phase 2 program, EPA proposed a more 
limited set of exemptions from federal enforcement requirements, 
specifically the compliance survey and independent sampling and testing 
requirements (sections 80.69 and 80.70(c), respectively).
---------------------------------------------------------------------------

    \4\2 The numbering of many provisions in the proposed 
regulations has been changed in the final rules. For example, 
proposed Sec. 80.69 is now Sec. 80.68, proposed Sec. 80.70(c) is now 
Sec. 80.65(f), proposed Sec. 80.70(d) is now Sec. 80.65(d), proposed 
Sec. 80.70(g) is now Sec. 80.65(g), and proposed Sec. 80.72 is now 
Sec. 80.69. Cross-references in the final California enforcement 
exemption regulation have been revised to reflect these and other 
numbering changes in the final reformulated gasoline regulations.
---------------------------------------------------------------------------

    The Agency also proposed a number of restrictions on the 
applicability of the California enforcement exemptions. First, the 
exemptions would not apply to gasoline sold in California and produced 
at a refinery located within the United States but outside California. 
Similarly, the exemptions would not apply to gasoline produced in 
California but sold outside that State. Second, the exemptions would 
not apply to gasoline produced under a two-year (March 1, 1996, through 
February 29, 1996) extension granted to small refiners under the 
California regulations. Third, the exemptions would become null and 
void (i.e., they would not apply to any California regulated party) if 
any gasoline formulation certified by the State using a predictive 
model or vehicle testing does not comply with the federal reformulated 
gasoline standards. Fourth, the enforcement exemptions would cease to 
apply to a party granted a variance by California unless EPA granted 
relief for extraordinary circumstances under section 80.73 of the 
federal regulations. Fifth, a regulated party that is assessed a 
penalty for a violation of either the California or federal 
reformulated gasoline requirements would lose its enforcement 
exemptions. (Such a party could petition the Agency for relief from 
this result, for good cause.) Sixth, the California enforcement 
exemptions would apply only during the time that the federal phase I 
program remains in effect (i.e., until the year 2000), subject to 
extension in a later rulemaking.
    The February 26, 1993, NPRM contains a more detailed discussion of 
the California reformulated gasoline program, the Agency's comparison 
of the emission reduction benefits of the California and federal 
programs, and the proposed California enforcement exemption provisions. 
That notice also includes a detailed rationale for the proposed 
exemptions and restrictions. See 58 FR 11747-11750.
    The Agency received several comments on the proposed California 
enforcement exemptions, all of which were generally supportive of the 
regulation. Most of these comments also suggested various modifications 
and clarifications of the proposed regulations. In this final rule the 
Agency is promulgating a revised version of the California enforcement 
exemptions regulation, which includes many of the modifications 
recommended by commenters.43 A detailed discussion of these 
comments, the Agency's responses to these comments, and the 
modifications made to the proposed rule is contained in a separate 
``Responses to Comments'' document. The following is a summary of the 
more significant changes made to the proposed rule:
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    \4\3The Agency has re-analyzed the relative emission reduction 
benefits of the California Phase II reformulated gasoline program 
and the federal Phase I program, using the complex model being 
promulgated today, and has again concluded that the California 
program is at least as stringent as the federal program. The 
analysis also found that fuel meeting the standards of the 
California Phase II program has a greater VOC, NOX and toxic 
performance reduction than fuel meeting the federal reformulated 
gasoline Phase I standards. A copy of this analysis has been placed 
in the rulemaking docket.
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    The proposed exclusion from the enforcement exemptions of small 
refiners who are granted a two-year extension under the California 
program has been dropped from the final rule. The Agency has determined 
that the emissions performance of fuels meeting the California 
reformulated gasoline standards to which these refiners will be subject 
during the two-year period, in conjunction with the statewide 
California sulfur standard, meets or exceeds the performance required 
under the Phase I federal reformulated gasoline program, as measured by 
the complex model (which may be used to determine compliance with 
federal standards during this period44). An analysis of these 
standards has been placed in the rulemaking docket.
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    \4\4 Use of the complex model is optional until the end of 1997, 
and mandatory thereafter.
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    The enforcement exemptions have been extended to California 
reformulated gasoline produced at refineries located outside of 
California that produce only California reformulated gasoline and 
federal conventional gasoline (i.e., that do not produce federal 
reformulated gasoline). The primary rationale for excluding such 
gasoline, that its producer would be required to implement all of the 
federal enforcement provisions for a refinery's non-California 
reformulated gasoline, is not applicable to facilities that do not 
produce federal reformulated gasoline. In order to assure that such 
gasoline is in fact shipped to, and sold in, California, section 
80.81(g) of the final regulations now prescribes transfer documentation 
and record keeping requirements for such gasoline.
    The compliance survey exemption is extended to all gasoline subject 
to the California reformulated gasoline regulations (no matter where 
produced) and will not be lost by a party who otherwise loses its 
California enforcement exemptions (e.g., a refiner who violates federal 
or state reformulated gasoline regulations or whose gasoline 
formulation is found to be less stringent than the federal 
requirements). The purpose of compliance surveys is to ensure that each 
area receiving reformulated gasoline receives gasoline that, on 
average, achieves the performance that would be expected if per-gallon 
compliance was the only available compliance option. The Agency 
believes that there would be little purpose served in imposing this 
requirement on only a small subset of the gasoline sold in California.
    Exemptions from the following enforcement provisions have been 
added in the final rule: the parameter value reconciliation 
requirements in section 80.65(e)(2); the reformulated gasoline and RBOB 
compliance requirements in section 80.65(c); the annual compliance 
audit requirements in section 80.65(h); and the compliance attest 
engagement requirements in subpart F. The Agency believes that these 
exemptions are consistent with the rationale for the exemptions 
proposed in the NPRM.
    The provision related to withdrawal of the enforcement exemptions 
on the basis of certification by California of a gasoline formulation 
that does not meet the federal reformulated gasoline standards has been 
modified in several ways. First and most importantly, the withdrawal 
will only apply to the refiner, importer or blender of the non-
complying formulation, not to all California gasoline. Second, any 
party whose gasoline is certified under either the predictive model or 
vehicle testing provisions of the California regulations will be 
required to notify the Agency within 30 days of such a certification 
and to submit a written demonstration that the gasoline formulation is 
in compliance with federal standards. If such a demonstration is not 
timely submitted, the exemptions are automatically (and immediately) 
lost. If a submitted demonstration is determined to be incorrect by the 
Agency, EPA will notify the party (by first-class mail)45 that its 
enforcement exemptions will expire on a certain date. Third, the date 
on which these exemptions will expire has been extended to no earlier 
than 90 days from the date of the EPA notice, to provide additional 
time for compliance. The Agency believes that this additional time is 
needed to comply with all of the many enforcement requirements that 
will become applicable if a California exemption is lost. In 
particular, requirements such as the independent analysis requirements 
(section 80.65(f)) and the compliance attest engagement requirements 
(subpart F) may require the negotiation of contracts with third 
parties.
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    \4\5 Because the loss of the enforcement exemption will apply to 
only a single party (rather than to all producers and importers of 
California gasoline), the Agency does not believe that there is a 
need for a Federal Register notice announcing a determination of 
non-compliance (as proposed in the NPRM) and has deleted this 
provision from the final rule.
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    The effective date for the withdrawal of the enforcement exemptions 
on the basis of a reformulated gasoline penalty assessment has been 
extended to 90 days, and this provision has been revised to make clear 
that this grace period does not begin until any interim administrative 
appeal has been completed. Once a final penalty assessment has been 
made by an agency or a district court, the 90-day period will begin.
    The provision related to compliance with standards on average for 
an averaging period that is partly before and partly after March 1, 
1996, has been clarified. Under the final rule, producers and importers 
who elect to demonstrate compliance on average with any federal 
reformulated gasoline standard46 will be required to demonstrate 
such compliance for two overlapping averaging periods: January 1, 1995, 
through December 31, 1995; and March 1, 1995, through February 29, 
1996. The proposal could have been interpreted to require compliance 
with these standards for a two-month averaging period in early 1996, 
which would be very difficult for refiners to meet on average and which 
was not intended by the Agency.
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    \4\6 In the case of refiners and importers using the simple 
model, the standards that may be met on average are the RVP, 
benzene, oxygen, and toxics emissions performance standards. For 
parties using the complex model, the standards that may be met on 
average are the benzene, oxygen, and toxics and VOC emissions 
performance standards.
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    The provision intended to prohibit the averaging of ``very clean'' 
California reformulated gasoline with ``less clean'' federal 
reformulated gasoline has been clarified in the final rule. In 
addition, it has been made applicable to producers and importers of all 
gasoline subject to the California program, not just to refiners and 
importers located outside the State (as was proposed). Section 80.81(d) 
now provides that producers and importers of such gasoline must exclude 
the volume and properties of California reformulated gasoline from all 
conventional gasoline and federal reformulated gasoline sold elsewhere, 
for purposes of demonstrating compliance with standards specified in 
section 80.41 and 80.90. An overall demonstration of compliance for all 
gasoline (California and non-California) produced or imported is also 
still required.
    The exemption from the federal recordkeeping requirements has been 
modified to require the retention for five years of records mandated by 
section 2270 of the California reformulated gasoline regulations (which 
require retention for two years). This requirement, along with other 
enforcement provisions for which an exemption is not being provided, 
will provide the Agency with the capability of performing audits of 
compliance with federal requirements by parties who produce California 
reformulated gasoline.
    As noted above, more detailed information on the modifications made 
to the proposed rule and the comments on which they are based is 
contained in the separate ``Responses to Comments'' document. That 
document also responds to comments that did not result in changes to 
the proposed rule.

B. Testing Methods and Testing Tolerances

    The final rule, in section 80.46, sets forth test methods regarding 
reformulated gasoline parameters. EPA has carefully considered all 
comments concerning proposed test methods and related issues and many 
of those comments have been incorporated in the final rule. The test 
methods are those that provide for the best balance of accuracy, cost 
effectiveness and ease of use for competent lab technicians. The final 
rule generally provides for one regulatory method for each parameter in 
order to assure accuracy and to avoid problems with biases between 
different methods. However, in two cases (regarding oxygen and 
aromatics) the regulation provides for an alternative method for 
industry to use, if desired, until January 1, 1997, to provide lead 
time to acquire equipment necessary for the primary test method and to 
become familiar with its use. Where American Society of Testing and 
Materials (ASTM) methods have been adopted, any future updated version 
of the ASTM methods will not automatically be adopted. EPA will use 
appropriate procedures if it desires to adopt any updated methods.
1. Test Methodology Overview
    EPA proposed test methods for the measurement of each of the 
parameters required in the creation of reformulated gasoline, and 
received numerous comments regarding the proposed methods. Most of the 
comments were quite similar in their overall character. However, one 
commenter seemed to summarize the prevailing recommendations quite 
well. API stated in part: ``API recommends that EPA observe the 
following guiding principles regarding laboratory test methods: (1) 
Test methods must be proven. . . . (2) Test methods must be reliable. . 
. . (3) Test procedures must be suitable for refinery personnel. . . . 
(4) Test methods must not be unnecessarily costly. . . . (5) Test 
method reproducibility must be recognized. . . . (6) Criteria for 
adoption of other methods should be developed. . . .''
    EPA agrees with most of these criteria. It would be ideal to 
discover accurate test methods that have been proven reliable in the 
industry, that are easy for personnel to operate and have a minimal 
cost. The new test method for Reid Vapor Pressure (RVP) set forth in 
the volatility regulations (40 CFR part 80, appendix E, Method 3) is an 
example of such a method that is accurate, easy to operate and is 
relatively inexpensive. These qualities in the RVP test method have 
enabled many downstream parties to incorporate this method into their 
oversight program under the volatility rule. EPA believes this improved 
oversight contributed significantly to the reduction in volatility 
violations during the 1993 high ozone season. Ease of operation and 
cost were considered when EPA adopted this test method. However, it 
must be recognized that the most important factors in the choice of the 
new RVP test method were its accuracy and precision.
    EPA would like to prescribe test methods that conform to API's 
criteria. However, EPA's leading priority must remain precision and 
accuracy, even at the expense of other criteria. EPA is always willing 
to cooperate with industry to investigate the possibility of easier and 
less expensive methods if the methods also are accurate and precise. To 
do so not only aids industry, but also ultimately assists EPA's purpose 
of preventing violations.
    EPA must follow its policy in maintaining precision and accuracy 
with regard to any enforcement test tolerances as well. EPA is 
determined to achieve the most accurate and precise result that is 
practical. EPA's purpose in testing is to ensure relevant standards are 
being met, and to allow an enforcement action where EPA is able to 
establish a violation with reasonable certainty. However, EPA does not 
have sufficient data at this time from the EPA laboratory to determine 
the most precise test tolerances. Interim test tolerances have been 
established until that data becomes available. Enforcement test 
tolerances are discussed more fully below.
    Most commenters requested that EPA allow more than one test method 
for each parameter. The final rule provides for one regulatory method 
for each parameter in order to assure accuracy and to avoid problems of 
bias between different methods. Refiners and importers must use the 
regulatory method, or an alternative method in the case of two 
parameters during a limited time period, when testing to meet the 
mandatory testing requirements of section 80.65(e). In addition, 
independent laboratories, when conducting tests to verify the accuracy 
of the refiner and importer testing, must use the regulatory method. 
EPA has learned from its experience with other motor vehicle fuel 
regulatory programs, notably volatility, that it is preferable to have 
one regulatory testing method as opposed to multiple regulatory test 
methods for each parameter because of the potential for conflicting 
results among methods due to bias. However, in two cases, oxygen and 
aromatics, where the test methods are relatively new, the regulation 
provides for optional alternative methods for refiners and importers to 
use to meet the testing requirements of section 80.65(e) until January 
1, 1997, providing lead-time for industry to acquire equipment and to 
become familiar with use of the regulatory methods. Of course, these 
alternative methods can likewise be used at any time for defense 
purposes as long as there is correlation with the regulatory methods.
2. Test Methods Under Section 80.46
    a. Reid vapor pressure (RVP). EPA proposed to use the ASTM method 
ES-15 or the procedure described in 40 CFR part 80, appendices D and E. 
Comments favored the use of ASTM ES-15. However, it was noted that ES-
15 is a temporary emergency ASTM standard and will expire shortly. ASTM 
D-5191 is the permanent standard. It was also noted that this method is 
suitable for oxygenated blends.
    Commenters requested that EPA also allow the two dry methods set 
forth in appendices D and E in 40 CFR part 80. These methods are the 
manual tank and gauge method, the Herzog analog method, and the Herzog 
digital method. In addition, a request was made to include the ASTM D-
5190 method, an alternative mini method.
    EPA has decided that RVP must be determined in accordance with the 
method in 40 CFR part 80, appendix E, Method 3. This method, very 
similar to ASTM D-5191, clearly complies with many of the criteria 
espoused by API. The method is simple and inexpensive. Industry has 
already begun to gear up for this method because of its use in the 
Phase II Volatility regulations. It is appropriate to use the same RVP 
test method for the volatility and reformulated gasoline programs to 
prevent confusion and inconsistencies.
    EPA has decided that the method in 40 CFR part 80, appendix E, 
Method 3 will be the only regulatory volatility test method. As with 
the volatility rule, other methods may be used for defense purposes as 
long as the method used is properly correlated with the regulatory 
method. (40 CFR part 80, appendix E, Method 3, Paragraph 9.4). See, 58 
FR 14476 (March 17, 1993) for a more thorough discussion regarding the 
choice of a single volatility test method.
    b. Distillations. EPA proposed to use the ASTM method D-86-82 as 
the regulatory test method, and comments were favorable with regard to 
this method. It was noted, however, that the method was updated in 
November 1990. This most recent revision of this method is ASTM D-86-
90. One commenter requested that the language be more specific. Another 
commenter suggested that a newer method, D-3710, which is a gas 
chromatography method, be used. A notation was also made that the 
repeatability and reproducibility figures in degrees Fahrenheit in the 
ASTM method D-86-90 were incorrect.
    EPA has decided that the distillation parameters must be determined 
in accordance with the ASTM method D-86-90. The regulatory language has 
been amended to state that the figures for repeatability and 
reproducibility given in degrees Fahrenheit in Table 9 in the ASTM 
method are incorrect, and may not be used. As with all the parameters, 
there will be only one regulatory distillation test method. However, 
other suitable methods may be used for defense purposes (but not to 
meet mandatory testing requirements) as long as they are properly 
correlated with the regulatory test method. EPA is always interested in 
the development of alternative methods if they are as accurate and 
precise as the regulatory test method. Many of the parameters in 
reformulated gasoline can be measured by a gas chromatograph with an 
appropriate detector. For this reason, it might be appropriate to 
explore the development of the D-3710 method or some alternative gas 
chromatographic method with an appropriate detector for future use as 
the distillation test method.
    c. Benzene. EPA proposed to use ASTM method D-3606 for the 
regulatory test method, and most commenters were in agreement with the 
use of this method. However, commenters noted that other acceptable gas 
chromatographic methods exist for the determination of benzene such as 
D-4815 (a gasoline oxygenate method) and D-4420 (an aromatics method). 
Comments were made that D-3606 requires a dedicated chromatograph for 
benzene in gasoline only. It was also noted that the D-3606 results may 
be affected by interference from the presence of ethanol and methanol.
    EPA has decided that the single regulatory method for measuring 
concentration of benzene will be ASTM method D-3606-92. Due to the 
possibility of a slight interference from ethanol and methanol in the 
test results, the method has been amended by the regulation to require 
that the instrument parameters be adjusted to ensure complete 
resolution of the benzene, ethanol and methanol peaks. As with all 
reformulated gasoline parameters, EPA has chosen one regulatory test 
method. However, it should be noted that the presence of benzene can be 
tested also by the GC-MS, the regulatory method for aromatics testing. 
With the GC-MS, there should not be a problem with the presence of 
oxygenates and a dedicated chromatograph is not needed. EPA is 
interested in the possibility of participating with industry in the 
development of the GC-MS method for benzene.
    d. Aromatics. EPA proposed to use the Gas Chromatograph-Mass 
Spectrometry (GC-MS) method, developed by EPA, for total aromatics 
determination.
    Most commenters opposed the method proposed by EPA. One commenter 
recommended delaying selection of a lab test method until the procedure 
can be evaluated and completely developed. Commenters also criticized 
the method for its cost, the amount of time the method demands, and 
because industry feels that the method will require highly specialized 
staff. One commenter stated that the proposed method was so incomplete 
that it was not possible to provide detailed technical comments on it. 
Most commenters suggested that EPA adopt ASTM method D-1319, a 
fluorescent indicator absorption method.
    EPA has decided to adopt the proposed method, the GC-MS, as the 
single regulatory method for the determination of total aromatics. 
However, because the method is relatively new, leaving industry little 
time to scrutinize the method, the final regulations allow use of ASTM 
method D-1319-93 until January 1, 1997 for purposes of meeting the 
industry testing requirements under section 80.65(e), provided this 
method is correlated with the GC-MS method. This two year transition 
period should allow sufficient time for industry to purchase equipment 
and become familiar with the new method. In addition, during this time 
period, it is anticipated that EPA and industry can discuss any 
problems that might arise as a result of the new method being 
promulgated. Moreover, the GC-MS method has been rewritten to provide 
more detail and specificity.
    EPA is aware that industry is uncomfortable with a newly developed 
method that has not had the usual round-robin testing or extensive 
participation by ASTM. However, EPA believes that the method available, 
D-1319, is so archaic when compared with present day technology, and 
has such extremely poor accuracy and precision, that it is necessary to 
develop a new method. Furthermore, D-1319 has not been proven effective 
with oxygenated fuels even though the updated version does include a 
multiplication factor to use when oxygenates are present. EPA also 
believes that it does not have the choice of leaving the method open 
until the GC-MS could be evaluated more thoroughly given the timing of 
the final rule. EPA believes the GC-MS is a dependable, accurate and 
precise method that, with the aid of industry, can be applied in the 
near future to many of the other reformulated gasoline parameters. The 
eventual use for several parameters should somewhat offset the initial 
cost. EPA also believes, based on personal experience, that the GC-MS 
apparatus is readily usable by competent lab technicians with about one 
week of training. It is less personnel-intensive and more accurate than 
the D-1319 method.
    e. Oxygen and Oxygenates. EPA proposed to use the GC-Oxygenate 
Flame Ionization Detector (OFID) method for determining oxygen content. 
Many commenters objected to the OFID method due to the fact that ASTM 
is still reviewing it through round-robin testing and precision 
information is not presently known. Commenters were concerned with the 
laboratory time required and the high deterioration and replacement 
rate cost of the cracker reactor. Commenters were also concerned with 
possible increased down-time in the laboratory. Most commenters 
suggested that ASTM method D-4815, a method used by industry during the 
winter oxygenate season, be used for testing oxygenates. Some 
commenters also suggested the use of portable Infrared (IR) analyzers 
because of their low cost and rapid results.
    EPA has chosen to use the GC-OFID method as the single regulatory 
method for measuring oxygen content and oxygenates. As with the 
aromatics determination, EPA felt compelled to develop a new method 
given the shortcomings of the methods presently available. However, the 
ASTM method D-4815-93 can be used for the compounds specified in the 
method until January 1, 1997 to meet industry testing requirements 
under section 80.65(e). ASTM method D-4815 has been used for quite some 
time, but with the addition of heavier oxygenates, D-4815 has become 
increasingly difficult to use. EPA is aware that there has been an 
attempt to expand the scope and range of D-4815 to include heavier 
oxygenates (as set forth in D-4815-93). However, the longer one has to 
wait to extract the heavier oxygenates, the more likely it is that 
hydrocarbons will be drawn out with the oxygenates, interfering with 
the test results. In addition, EPA is not satisfied with the accuracy 
of D-4815. The reproducibility and repeatability factors are quite 
large. Presently, OFID is the only accurate method known that is 
capable of testing for oxygenates at all ranges. EPA believes a 
reliable, accurate and precise method that is capable of testing for 
oxygenates at all ranges is required when the reformulated gasoline 
requirements go into effect.
    EPA has been using GC-OFID for four years. During that period, the 
cracker reactor has required replacement on only one occasion. EPA has 
had the opportunity to use various portable IR methods for field 
screening tests and has been pleased with the results. However, 
although these are excellent screening devices, they are not presently 
at the stage of development that would allow their use as a regulatory 
enforcement method.
    f. Sulfur. EPA proposed to use an inductively coupled plasma atomic 
emission spectrometer (ICP-AES) method for sulfur analysis that was 
developed at EPA's laboratory. Most commenters were opposed to this 
method because it is an unproven technology, because it is very 
expensive, and because there are no substantial benefits received from 
this technology that are not also available through existing methods. 
It was also thought not to be practical in a refinery environment. 
Commenters suggested the use of ASTM D-4045, ASTM D-2622, or ASTM D-
4294.
    After considering the comments, EPA has chosen ASTM D-2622-92, an 
x-ray spectrometry method, as the regulatory sulfur test method. This 
is a newer version of the same test method that is used for testing 
sulfur in the low sulfur diesel fuel program. Industry should already 
be on-line with this method since the diesel program went into effect 
on October 1, 1993. The newer version has correction factors to adjust 
for the interference from oxygenated product.
    g. Olefins. EPA proposed to use the ASTM method D-1319-88 to 
determine olefin content. Most commenters were in favor of this method 
since there are no other standard methods for olefins from which to 
choose at this time. Most commenters pointed out that the method is not 
as accurate as it should be. Comments were made that the method was 
updated in 1989 (D-1319-89). Comments were made that the method would 
not detect any oxygenates present, but that the results can be 
normalized to determine the amount of oxygen present using 
multiplications factors.
    EPA has chosen the ASTM method D-1319-93, Fluorescent Indicator 
Absorption method (FIA) as the single regulatory method to determine 
olefin content. EPA has chosen this method because there are no 
alternative methods available. EPA believes that an accuracy greater 
than is possible with the D-1319 method is desirable and looks forward 
to working with industry to develop a suitable GC-MS method to detect 
olefins in the near future. The newest version, ASTM D-1319-93, was 
chosen because it contains multiplication factors to determine the 
amount of oxygen present.
3. Enforcement Test Tolerances
    EPA has chosen to set forth enforcement test tolerances in the 
preamble of this regulation for oxygen, benzene, and RVP, the three 
parameters that will be subject to enforcement testing for minimum and/
or maximum levels under the simple model.
    Commenters suggested that EPA should set enforcement test 
tolerances for all seven parameters. One commenter stated the belief 
that EPA is required by the Clean Air Act to set enforcement test 
tolerances. Many commenters requested enforcement leniency downstream 
so that pipelines, while attempting to stay in compliance, do not force 
refiners to produce reformulated gasoline at even lower specifications 
than the regulations require.
    a. Issues Regarding Whether Enforcement Test Tolerances Are 
Required. There are three specific provisions in the section 211(k) 
that refer to establishing test tolerances. The first, section 
211(k)(3)(A), establishes a formula fuel as the statutory minimum for 
VOC and toxic emissions reductions, if the formula fuel is more 
stringent than the performance standards found in section 211(k)(3)(B). 
The formula includes a minimum oxygen content of 2.0 wt. % ``subject to 
a testing tolerance established by the Administrator.'' This provision 
is inapplicable, however, as EPA has determined that the performance 
standards in section 211(k)(3)(B) are more stringent than the formula 
fuel.
    Second, section 211(k)(4)(C) of the Act requires that EPA establish 
``appropriate measures of, and methodology for, ascertaining the 
emissions of air pollutants (including calculations, equipment, and 
testing tolerances).'' This provision addresses technical issues 
regarding measurement or determination of emissions of various air 
pollutants, and does not require that EPA establish enforcement test 
tolerances. Congress most likely expected that individual vehicle 
testing by refiners, importers, and EPA would be the basis for 
quantifying the emissions reductions from reformulated gasolines, with 
certification of reformulated gasoline based on such individual test 
programs.47 In using a large data base from several vehicle test 
programs EPA has exercised the authority provided under this provision, 
and has established emissions models that are much more accurate and 
reliable predictors of emissions performance than individual vehicle 
test programs. Variability in test results was accounted for in the 
modeling process itself, so that the models include a ``test 
tolerance'' based on averaging of test results from the vehicle test 
programs underlying the emissions models.
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    \4\7While Congress apparently expected that EPA would in all 
likelihood establish a vehicle testing program to measure emissions 
and certify reformulated gasoline, EPA has instead adopted an 
emission model that is built on many different test programs. To the 
extent ``calculations, equipment, and testing tolerances'' is still 
relevant in this context, it is taken to address testing needed to 
use the model, such as testing of a gasoline to obtain data for 
input into the model. The test procedures adopted by EPA typically 
include provisions designed to address test variability. In addition 
EPA's regulations specify test tolerances for various parameters, 
such as when a refiner and an outside laboratory measure the fuels 
parameters, and specify the acceptable range for such parameters in 
using the model.
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    EPA has established appropriate test procedures for use with the 
model, but they measure not air pollution emissions but fuel parameter 
values needed to operate the model. 40 CFR 80.46. EPA has, however, 
established test tolerances to determine when fuel parameter values are 
acceptable for use in the model, as well as limits on the range of the 
parameters for the model. Where a refiner or importer seeks to augment 
the emissions model through a vehicle test program, EPA's regulations 
also include provisions on testing and calculations, and account for 
test tolerances through the averaging of vehicle test results. EPA 
believes these fully implement any requirement to establish test 
tolerances in a context where an emissions model is the methodology to 
determine air pollutant emissions.
    Some commenters point to language of various legislators made 
during the floor debate on the Clean Air Act Amendments of 1990. In the 
floor debate, various Congressmen made general statements on the issue 
of whether EPA must provide enforcement tolerances under section 
211(k)(4)(C).48 There is no clear indication in these statements 
that Congress intended in section 211(k)(4)(C) to mandate changes in 
the numerical standards adopted by EPA, or to mandate a regulatory 
exercise of enforcement discretion. Instead these floor debate 
statements are most reasonably read as indicating that EPA should 
establish reasonable testing tolerances in the procedures and 
methodologies adopted to quantify air pollutants for the reformulated 
gasoline and anti-dumping programs, so that the regulated community and 
EPA can measure these air pollutants in a workable, verifiable manner 
without undue cost. EPA believes that its regulations fully implement 
this objective. To the extent these statements during the floor debate 
are read to imply that ``testing tolerances'' should be interpreted the 
same for purposes of section 211(k)(2)(B) and 211(k)(4)(C), EPA 
respectfully rejects this interpretation as contrary to the intent of 
Congress as expressed in the language of the Act. Furthermore, floor 
debate quotes are not authoritative as to the meaning of the Act, 
especially where such statements are contrary to the language of the 
Act itself.
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    \4\8See, e.g., statement by Congressman Hall at 136 Cong. Rec. 
H12901 (October 26, 1990.) ``A reasonable testing tolerance is 
expressly provided for oxygen in new 211(k)(2)(B). Under 
211(k)(4)(C), EPA must also establish reasonable testing tolerances 
for all other aspects of this program, to minimize cost and make it 
workable and verifiable in the real world. EPA is specifically 
expected to promptly establish such tolerance limits. Similar 
reasonable tolerances are intended for the CO program in 211(m).''
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    The third relevant statutory provision is section 211(k)(2)(B). 
There Congress tied the testing tolerance requirement to the level of 
the standard itself. This provision establishes a minimum oxygen 
content requirement for the reformulated gasoline of ``2.0 percent by 
weight (subject to a testing tolerance established by the 
Administrator)''. Unlike section 211(k)(4)(C), which addresses 
technical issues regarding measurement of air pollutants, this 
provision addresses the level of the standard itself and compliance 
with the oxygen content requirement. EPA interprets this as requiring 
establishment of a reasonable testing tolerance for the oxygen content 
requirement. As in the winter time oxygenated gasoline program, EPA is 
establishing this tolerance as 0.30 wt.% oxygen. Unlike section 
211(k)(4)(C), there is no explicit requirement that this tolerance be 
incorporated into the regulations, and given the nature of an 
enforcement testing tolerance EPA is not adopting it as a rule.
    b. The discretionary nature of enforcement test tolerances. As 
discussed above, enforcement test tolerances are not required by the 
Act except for oxygenate testing pursuant to section 211(k)(2)(B), and 
even there, Congress left to EPA's discretion at what level such 
tolerance should be set as well as any criteria EPA would use. EPA has 
carefully considered the many comments regarding test tolerances. Any 
test tolerance would involve establishing a policy that the Agency 
would forego an enforcement action unless, in testing an enforcement 
sample, EPA found that a standard was exceeded by a set amount. Other 
appropriate conditions could also be required, such as evidence that 
the regulated party conducted appropriate sampling and testing. 
Establishing an enforcement tolerance based on testing or any other 
factor is a matter solely within the Agency's enforcement discretion, 
and is not addressed by section 211(k), except for purposes of the 
oxygen content requirements of section 211(k)(2)(B). As described 
below, EPA has decided to announce its current position on enforcement 
test tolerances with respect to several of the emission and content 
standards specified for reformulated gasoline subject to the simple 
model.
    EPA is aware that as a result of the gasoline volatility 
regulations at 40 CFR 80.27-28, many pipelines only accept gasoline 
which tests below the RVP standard minus a margin of safety set by the 
pipelines. In some cases, the margin of safety set by the pipelines is 
equal to the reproducibility of the RVP test method. Many commenters 
expressed concern that a similar pipeline policy also would apply to 
the reformulated gasoline maximum/minimum parameters. Likewise, EPA is 
concerned about downstream parties who have limited control over the 
quality of the product received. For example, gasoline in the custody 
of a pipeline or terminal may be the product of several commingled 
refinery shipments. In light of these concerns, EPA intends to withhold 
prosecution of downstream parties such as pipelines and terminals, 
where proper sampling and testing by the downstream party shows that 
the product exceeds standard but tests within the tolerance set by EPA, 
and where there is no reason to believe that the party caused the 
gasoline to exceed the standard.
4. Enforcement Test Tolerance Values
    Almost every commenter suggested that EPA use reproducibility for 
enforcement tolerances. Commenters suggested that because the 
comparison of test results from different laboratories is inevitable, 
it is necessary to incorporate an appropriate measure of the 
variability between laboratories.
    EPA has decided in its discretion to adopt enforcement test 
tolerances for certain requirements in addition to oxygen content. As 
discussed above, the Clean Air Act does not require enforcement testing 
tolerances for the six reformulated gasoline parameters other than 
oxygen (i.e., RVP, distillations, benzene, aromatics, sulfur, and 
olefins). In addition, only three fuel parameters (RVP, oxygen, and 
benzene) have maximum and/or minimum standards under the simple model. 
Therefore, these simple model parameters are the only ones likely to 
involve EPA testing for enforcement purposes. Although not required to 
do so, EPA has decided to set forth in the preamble of this Rule 
testing tolerances for these parameters, in order to provide regulated 
entities with information of interest to them regarding EPA's 
enforcement program.
    In fuels enforcement programs under Title II of the Clean Air Act, 
EPA generally uses data obtained from its own laboratory to determine 
the appropriateness of any testing tolerance. At the present time, 
however, sufficient data needed to determine enforcement testing 
tolerances based on EPA laboratory data are not available. Therefore, 
EPA is setting initial test tolerances sufficiently large to assure 
that any competent laboratory testing a conforming sample could arrive 
at results that would indicate that the sample was not in violation. 
However, EPA may adopt new tolerances as data on test methods are 
developed, as technology changes, or as further information becomes 
available concerning the precision and accuracy of a particular method, 
whether established by EPA or by multiple testing protocol.
    The test tolerance is only to be used by EPA to determine whether 
an enforcement action should be brought. It is EPA's contention that 
any sample that is over the standard is in violation. However, no 
enforcement action will be brought if the sample is over the standard, 
but within the tolerance. Furthermore, refiners and importers may not 
use the tolerance to expand the applicable standard. If the refiner or 
importer results show the product to be above the standard, then the 
product is in violation regardless of whether or not it is within the 
tolerance.
    To better establish the most appropriate test tolerances, EPA 
proposes a joint effort between EPA and industry to develop a gasoline 
standard with known properties which could be used by all laboratories 
for calibration purposes and for detecting laboratory biases.
    EPA has not included in this Preamble the enforcement tolerances 
for VOC and NOX emissions performance, but intends to issue 
guidance that includes these enforcement tolerances within the next 
several months. The tolerances applicable under the complex model will 
be applied by EPA in the manner discussed above.
    The following enforcement tolerances currently are applicable under 
the simple model:
    a. RVP.  A tolerance of 0.30 psi will be allowed for RVP in order 
to be consistent with the tolerance level currently used in the 
gasoline volatility program.
    b. Oxygen. The oxygen tolerance will be 0.30 weight percent oxygen, 
which is consistent with the test tolerance currently in use in the 
winter oxygenate program.
    c. Benzene. The initial test tolerance for benzene is 0.21 vol%, 
but this tolerance value will be modified through a round-robin testing 
process that is intended to identify a more appropriate test tolerance 
for benzene. Under this approach, the 0.21 vol% initial benzene 
tolerance will be used only until January, 1996, when the modified 
benzene tolerance will apply.
    The process for identifying the new benzene tolerance will involve 
a round-robin testing program to be carried out cooperatively by EPA 
and the American Petroleum Institute (API). This testing program will 
involve testing by a number of laboratories selected by EPA and API, in 
accordance with a round-robin testing protocol that will be developed 
jointly by EPA and API. The purpose of the testing program is to 
identify the lab-to-lab reproducibility that exists among high-caliber 
laboratories that follow good laboratory procedures including 
procedures dealing with quality assurance and quality control, and 
where all reasonable steps have been taken to achieve high lab-to-lab 
correlation. The testing program generally will follow the round-robin 
methodology used by the American Society of Testing and Materials 
(ASTM). EPA, API, and the laboratories involved also will attempt to 
improve lab-to-lab correlations, through use of a gasoline matrix with 
known, repeatable properties.
    The new tolerance will be determined from the reproducibility 
standard deviation resulting from the round-robin in such a way that 
the Agency can be 95% certain that materials tested at the standard 
plus the tolerance are in fact over the standard. The above 
calculations will be used to establish the tolerance regardless of 
whether the resulting value is less than or greater than 0.21 vol%, but 
the value will not be greater than 0.30 vol% regardless of the results 
of the testing program.
    The round-robin testing is to be completed by January 1, 1995, 
statistical analysis of the test results will be completed by June 1, 
1995, the new tolerance will be announced by EPA by July 1, 1995, and 
the new tolerance will be effective beginning in January, 1996. In the 
event the round-robin testing program is not completed by January, 
1995, the benzene tolerance will be 0.03 vol% beginning in January, 
1996, provided that the failure to complete the program is through no 
fault of EPA. If, however, the testing program failure is EPA's fault, 
or if the testing program is completed in accordance with the round-
robin testing protocol and the testing data is submitted to EPA by 
January 1, 1995, the initial 0.21 vol% benzene tolerance will continue 
to apply beyond January, 1996. If, through EPA's fault, the 
announcement of the tolerance is delayed beyond July 1, 1995, the new 
tolerance will become effective six months following announcement of 
the new tolerance, and until then the tolerance of 0.21 vol% will 
apply.

C. Independent Sampling and Testing Requirements

    In its 1992 supplemental proposal, EPA proposed that refiners and 
importers would be required to carry out a program of independent 
sampling and testing of reformulated gasoline that is produced or 
imported. 57 FR 13445. Only refiners commented on this proposal; 
without exception, these comments were critical. Nevertheless, EPA has 
retained the independent sampling and testing requirement in the final 
rule, with certain revisions based on comments, for the reasons 
contained in the 1992 SNPRM and in today's notice.
    In the 1992 SNPRM, EPA explained the reasons for the independent 
sampling and testing requirement. Independent sampling and testing 
would flag errors in refiner or importer analysis and allow corrections 
of either noncomplying product or of the accounting books kept by these 
parties. These errors could be caused by mistakes in sample collection, 
sample analysis, by bias in the refiner's or importer's sampling and/or 
testing system, by inadvertent mistake, or by outright cheating.
    In addition, EPA expects that reformulated gasolines will almost 
always be combined in the fungible gasoline distribution system after 
it leaves the refinery, and in many cases such fungible mixing will 
occur before the gasoline leaves the refinery or is transferred by the 
refiner to another party. Once fungible mixing occurs, there is no 
opportunity to look behind the refiner's or importer's test result 
records, except for those limited cases where EPA inspects reformulated 
gasoline at the refinery before fungible mixing of the gasoline occurs. 
This problem is amplified by the averaging option available for 
refiners and importers. Once a batch of reformulated gasoline becomes 
mixed with other batches from the same or different refiners or 
importers, EPA is no longer able to test this fungible mixture to 
determine compliance with either per-gallon or averaging standards. EPA 
can then only sample and test for compliance with the maximum and 
minimum requirements, and has to rely on the refiner's or importer's 
records and test results to verify the accuracy of averaging and credit 
reports that are submitted.
    Sampling and testing by EPA would therefore normally be a valid 
check only for maximum and minimum requirements, and will not provide a 
means of verifying whether the individual gasolines contained in a 
fungible mixture met the reformulated gasoline per-gallon or average 
standards when produced. Absent independent sampling and testing, 
therefore, there would be little or no means of verifying whether 
reformulated gasoline met standards, or whether reports of credit 
creation are accurate.
    Commenters on the proposed rule cited a number of reasons the 
independent sampling and testing requirements should be revised or not 
be made final. One commenter stated that independent sampling and 
testing is unnecessary and redundant to other enforcement requirements 
included in the reformulated gasoline program, such as penalties for 
noncompliance, the quality assurance sampling and testing defense 
element, gasoline quality surveys, recordkeeping, and attest 
engagements.
    While these enforcement requirements in the final rule are 
important, their focus is different from the focus of independent 
sampling and testing. Quality assurance sampling and testing is a 
required showing for most parties presumed liable for downstream 
violations that is intended to monitor compliance with the maximum and 
minimum requirements, and is not intended to monitor the accuracy of 
the per-batch properties refiners and importers enter into their 
records. The recordkeeping requirements do not play a verification 
role; records kept by refiners and importers are only as accurate as 
the information entered by these parties. The gasoline quality surveys 
monitor the overall quality of gasoline being used in a covered area 
during the survey periods, but the capacity of surveys to detect 
cheating by refiners and importers is limited. Surveys will take place 
in any covered area during only several weeks per year. In addition, 
the gasoline used in a covered area is a mixture of the gasolines 
produced or imported by a large number of refiners and importers, often 
hundreds or thousands of miles distant from the covered area. Surveys 
would not be expected to detect improper deviations in gasoline 
properties from the properties reported by one or several of these 
refiners or importers.
    The procedures specified for attest engagements were specifically 
designed to not overlap with the independent sampling and testing 
provisions. In any event, in most cases attests would not be capable of 
detecting errors or cheating in sample analysis; an auditor only can 
review the information contained in a refiner's records, and is not 
able to collect and analyze samples of gasoline produced months prior 
to the attest engagement.
    These and other components of EPA's enforcement program for 
reformulated gasoline are not able on their own to address the main 
focus of the independent sampling and testing program--the accuracy of 
the individual batch determinations made by refiners and importers. 
These determinations must be accurate to achieve compliance with either 
the per-gallon or averaging standards. Given the fungible mixing of 
reformulated gasoline both within a refinery or import facility and in 
the gasoline distribution system, EPA is not able to check the accuracy 
of these individual batch determinations.
    Compliance with the reformulated gasoline requirements also 
involves accurately analyzing many more gasoline components than is 
required under any of EPA's prior motor vehicle fuel regulations. This 
additional complexity both increases the need for refiner or importer 
accuracy, and makes it that much harder for EPA to check compliance 
after gasoline has been fungibly mixed. EPA believes the independent 
sampling and testing program is a reasonable response to these 
circumstances, and draws a reasonable balance between EPA's enforcement 
needs and the desirability of maintaining a highly fungible gasoline 
distribution system.
    Other commenters stated that independent sampling and testing was 
unnecessary because the fungible gasoline distribution system, and 
contractual commitments, will guarantee product compliance. EPA 
believes that product specifications will be set by pipelines or 
gasoline sales contracts for reformulated gasoline, however these 
specifications are expected to address only the minimum and maximum 
requirements and time and place of use restrictions. EPA does not 
believe these specifications will focus on whether a particular batch 
of reformulated gasoline was produced on average or per-gallon, or on 
the specific parameter values of the batch, provided the values are 
within the maximum and minimum requirements. As a result, gasoline 
specifications do not obviate the need for independent sampling and 
testing.
    Several commenters cited cost as a basis for excluding independent 
sampling and testing from the final rule. One industry group commented 
that the costs of independent sampling and testing will be $30 to $40 
million per year.
    EPA believes the costs of independent sampling and testing will be 
significantly smaller than this commenter suggested. EPA has estimated 
that the annual costs of this program element will be between $1.9 and 
$7.8 million per year. A copy of a memorandum describing EPA derivation 
of this estimate has been placed in the docket for this rulemaking. EPA 
believes that the principal difference between the industry and EPA 
cost estimates is that the industry assumes it will be necessary for 
each refinery to have an independent sampler in place 24 hours per day, 
365 days per year. As a result of this assumption, industry assigns an 
annual cost of $32 million for sample collection only. This assumption 
is not justified. While some high-volume refineries producing a large 
percentage of reformulated gasoline may require the presence of an 
independent sampler much of the time, most refineries will produce a 
batch of reformulated gasoline less frequently than every day.49
---------------------------------------------------------------------------

    \4\9 Industry has estimated that, nationwide, 175 batches of 
gasoline are produced per day. Only a portion of these will be of 
reformulated gasoline, and of these, a portion will be produced 
through in-line blending and not require independent sampling and 
testing. The number of batches per day that will require independent 
sampling and testing is between 22 and 71. There are about 200 
refineries operating in the United States; EPA believes that between 
100 and 120 of these will produce reformulated gasoline (excluding 
refineries in California that will be exempt from the independent 
sampling and testing requirements). As a result, EPA estimates that 
on average refineries will produce one batch of reformulated 
gasoline that requires independent sampling and testing every 1.4 to 
5.5 days.
---------------------------------------------------------------------------

    Several commenters stated that the costs of independent sampling 
and testing will be disproportionately high for small refiners, because 
their batch sizes are small in comparison to batch sizes for larger 
refiners, and because independent labs may not be conveniently located 
relative to small refineries, requiring sample shipping. It is true 
that the per-gallon costs of independent sampling and testing will be 
larger for a refinery producing reformulated gasoline in small batches 
in comparison to the per-gallon costs for a refiner producing larger 
batches. Nevertheless, EPA believes this cost difference is 
insignificant. For a 20,000 barrel batch, a small-sized batch, the per-
gallon cost of independent sampling and testing would be $0.0003; for a 
50,000 barrel batch, the per-gallon cost would be $0.0001.50 EPA 
anticipates that samples collected at refineries located distant from 
any reliable independent laboratory will be shipped to the laboratory, 
but does not believe such sample shipping is problematic or costly. 
These conclusions are based on EPA's experience in conducting gasoline 
quality inspections throughout the country over at least the past dozen 
years, when its inspectors have shipped several thousand samples per 
year to EPA's laboratory for analysis.
---------------------------------------------------------------------------

    \5\0 EPA estimates the cost to collect and store a sample will 
be $230, and the analysis costs will be $42 (based on an analysis 
cost of $415 and analysis of 10% of the samples collected at a 
refinery), or $272.
---------------------------------------------------------------------------

    Commenters stated that the independent sampling and testing 
requirements will result in delays in the movement of finished 
reformulated gasoline due to the time required to resolve test result 
discrepancies between refiner/importer laboratories and independent 
laboratories, or that gasoline found to violate standards through 
independent sampling and testing may not be correctable because the 
gasoline in question will be in the fungible distribution system at the 
time the violation is determined.
    EPA does not believe these concerns create a basis for excluding 
the independent sampling and testing requirements. EPA does not 
construe the independent sampling and testing provisions to require 
refiners or importers to hold gasoline at the refinery or import 
facility until the independent testing is completed. In the event of a 
discrepancy between the refinery/importer test result for a gasoline 
batch and the independent laboratory test result for that batch, EPA 
anticipates the refiner/importer will correct the batch values it 
claims: if the standard for the parameter in question is being met on 
average, the value for that parameter used in calculating compliance 
would be changed (if the correct parameter value is within the per-
gallon maximum).
    In the case of gasoline subject to the per-gallon standards, and in 
the case of the per-gallon minimum and maximum standards, EPA believes 
refiners and importers will be able to avoid the situation where, 
subsequent to the gasoline leaving the refinery or import facility, the 
gasoline is discovered to violate these standards. Refiners and 
importers will avoid this situation in several ways. First, refiners 
and importers will have the results of their own tests before the 
gasoline leaves the refinery or import facility, and the final rule 
requires that these tests must indicate the gasoline meets all 
standards. Second EPA's experience is that refiners and importers 
produce gasoline subject to per-gallon standards with a ``margin-of-
safety'' sufficient to ensure tests by others do not indicate the 
gasoline fails to meet the standards. Third, with regard to tests 
pursuant to the independent sampling and testing requirement, refiners 
and importers presumably will select only high-caliber independent 
labs, and will closely correlate with them, making the possibility of 
conflicting test results unlikely. Fourth, the independent lab results 
do not have to exactly match the refiner- or importer-test results, but 
rather have to be within a range that is specified in the final rule. 
Lastly, test results by regulated parties downstream of the refinery or 
import facility (e.g., pipelines, terminals), or by EPA, would not be a 
basis for concluding gasoline violates a per-gallon minimum or maximum 
standard unless the test result exceeds the standard plus an 
enforcement tolerance. Enforcement tolerances are discussed in another 
section of this preamble.
    Nevertheless, in a situation where these mechanisms fail and a 
refiner or importer learns, through tests by EPA or others, that a 
parameter value for a gasoline batch subject to the per-gallon standard 
violated that standard, or for a gasoline batch subject to the average 
standard violated a per-gallon minimum or maximum standard, the refiner 
or importer would be expected to correct the violation.
    Several commenters raised concerns over the logistics and safety of 
non-company employees entering refineries to collect samples. EPA 
agrees that in order to comply with the independent sampling and 
testing requirements, a refiner or importer will be required to make 
arrangements with the independent laboratory that address logistics and 
safety issues. A refiner or importer would be expected to select as its 
independent laboratory a company that is able and willing to commit by 
contract to collect samples in a manner that minimizes interference 
with refinery or importer operations--to collect samples in a timely 
manner, and comply with company safety requirements. Because refiners 
and importers are given the latitude to select their own independent 
laboratories, EPA believes these parties will be able to identify and 
select ones that are satisfactory.
    Several commenters stated that independent sampling and testing 
will not be a successful deterrent to willful cheating, because a 
cheater can buy off its ``independent'' laboratory. While this type of 
fraud is always possible, EPA believes it is considerably more 
difficult for a refiner or importer intent on cheating to falsify 
reports when a second company has to be brought into the conspiracy. 
Given the consequences if caught, independent laboratories are unlikely 
to collaborate with a refiner or importer to falsify reports to EPA. 
False reporting by a refiner, importer, or independent laboratory would 
constitute a criminal violation under 18 U.S.C. section 1001, subject 
to monetary penalties and imprisonment, and EPA would expect to seek 
vigorous prosecution of such a case. In addition, the final rule 
provides that any laboratory that fails to comply with the requirements 
of the rule is subject to debarment or suspension, i.e., the company 
that operates the laboratory would be made ineligible for any 
government contracts, and would be precluded from participating in the 
reformulated gasoline program.
    Another criticism made of the independent sampling and testing 
provision is the inconsistency with the requirements for conventional 
gasoline, where independent sampling and testing is not required. EPA 
considered requiring independent sampling and testing for conventional 
gasoline, but decided to treat conventional and reformulated gasoline 
differently in this regard. EPA believes the profit incentive for 
cheating is less for a producer of conventional gasoline than for a 
producer of reformulated gasoline. Conventional gasoline does not 
require the new and costly refining procedures necessary for 
reformulated gasoline, and will not be sold at reformulated gasoline's 
price. In contrast to reformulated gasoline, conventional gasoline is 
subject to neither time and place of use restrictions nor to per-gallon 
maximums and minimums. Moreover, an enforcement program for 
reformulated gasoline that is more strict than for conventional 
gasoline is appropriate given the greater air quality concerns in the 
areas slated to receive reformulated gasoline.
    EPA considered enforcement approaches to verifying refiner and 
importer test results for conventional gasoline that are less 
burdensome than independent sampling and testing, such as the 
approaches that were suggested by the reformulated gasoline commenters 
and are discussed below. These middle-ground approaches were rejected 
for the same reasons they were rejected for the reformulated gasoline 
program--they simply would not be effective as test verification 
mechanisms.
    As a result, EPA concluded that while independent sampling and 
testing is necessary for reformulated gasoline, these procedures are 
not justified for conventional gasoline.
    Commenters suggested several alternatives to independent sampling 
and testing. None of these alternatives satisfy the program needs 
addressed by independent sampling and testing, however.
    Many commenters stated that EPA should establish a program of EPA 
certification of refiner and importer company laboratories, and 
participation in round-robin analysis programs, as an alternative to 
independent sampling and testing. Presumably independent sampling and 
testing only would be required where a company laboratory failed to 
obtain EPA certification. Commenters cited other federal programs that 
include the laboratory certification and/or round-robin approach, 
including the National Pollutant Discharge Elimination System (NPDES) 
and federal requirements for petroleum products produced to meet 
military specifications.
    EPA does not believe that laboratory certification and round-robin 
programs would provide sufficient verification of refiner or importer 
testing of reformulated gasoline. Programs of this type generally 
provide information on the quality of work a given laboratory is 
capable of performing under optimal conditions; they shed little light 
on the quality of the laboratory's day-to-day work which is the main 
focus of the independent sampling and testing requirement.
    Certification by EPA or another organization would determine if a 
laboratory has proper equipment and personnel properly trained as of 
the date of the certification, but would provide no certainty of the 
ongoing laboratory operation. The treatment of round-robin samples by 
laboratories is predictably special. If a laboratory's continued 
certification is contingent on the quality of its analysis of samples 
received from EPA, the laboratory would be expected to assign its best 
personnel to this task, to be particularly careful in the analysis, and 
probably to repeat the analysis enough times to be certain a correct 
result is obtained. The treatment received by round-robin samples may 
bear little resemblance to the treatment normal samples receive. 
Certainly, neither laboratory certification nor round-robin testing 
would constitute any deterrent to a willfully cheating refiner or 
importer.
    EPA believes the other federal programs that use laboratory 
certification and/or round-robins are inappropriate precedents for use 
of these approaches in the reformulated gasoline program. In the case 
of petroleum products produced to military specifications, the military 
presumably receives the products produced and can at that time verify 
whether the products meet relevant standards and criteria. This type of 
after-the-fact verification is not possible for reformulated gasoline 
for the reasons that have been discussed. In the case of facilities 
regulated under the NPDES program, it is possible to verify whether the 
levels of pollutants being discharged by the facilities are consistent 
with facility-specific permits that have been issued through EPA 
inspections that include water samples collected at the facilities. The 
reformulated gasoline situation is distinguished from the NPDES program 
because fungible mixing that often occurs within the refinery or import 
facility would render EPA inspections ineffective as a reformulated 
gasoline test verification mechanism.
    Commenters offered other alternatives to independent sampling and 
testing that would rely on random refinery audits by independent 
parties or by EPA, or of verification-analysis by EPA of a 
representative portion of the samples analyzed by refiners and 
importers. EPA rejected these alternatives. The limitations inherent in 
EPA refinery or import facility inspections that result from fungible 
mixing, discussed above, also would apply to audits conducted by 
independent parties. A program that would rely on EPA-conducted 
verification analysis of certain samples that are sent to EPA by 
refiners or importers raises the same types of concerns that occur 
under the round-robin approach. Refiners and importers would be 
expected to analyze samples that also are sent to EPA for verification-
testing with a level of care that may bear little resemblance to normal 
laboratory practices, and this approach would provide small deterrent 
to the willful cheater.
    Other commenters suggested that EPA should rely on EPA-conducted 
inspections at refineries and at downstream locations, as in the 
gasoline volatility program. EPA intends to conduct inspections like 
these under the reformulated gasoline program, but does not consider 
them to be replacements for independent sampling and testing. EPA 
inspections at refineries and import facilities will be able to monitor 
the refiner- or importer-claimed properties for reformulated gasoline 
only if product is present at the time of the EPA inspection that has 
not been fungibly mixed. EPA believes this will often not be the case. 
Moreover, the refiner or importer is required to submit reports to EPA 
stating the claimed properties of a batch of gasoline only at the 
conclusion of each quarter, and would know which gasoline EPA sampled 
during an inspection. It would be expected that prior to filing its 
report to EPA, a refiner or importer would verify, and re-verify, its 
analysis results for gasoline that had been sampled by EPA. A willful 
cheater could simply record the correct properties for gasoline that 
had been sampled by EPA, while continuing to report bogus properties 
for the remainder of the gasoline.
    Inspections conducted by EPA downstream would almost always be of 
fungibly mixed gasolines, and as a result would be valid only for 
checking compliance with the maximum and minimum requirements; 
downstream inspections would not serve as a check on the per-gallon or 
average properties claimed by refiners and importers.
    It is relevant to note the difference in enforcement that was used 
under the lead phasedown program, as contrasted with the enforcement 
possible under reformulated gasoline. Lead phasedown was similar to 
reformulated gasoline in that refiners and importers were required to 
meet an average standard that applied to gasoline produced or imported. 
Unlike reformulated gasoline, however, lead phasedown compliance was 
based only on the volume of gasoline produced and the amount of lead 
used in that production--two categories of information that were easily 
verified after-the-fact. Lead usage was verifiable because EPA required 
all lead manufacturers to report to EPA the amount of lead shipped to 
each refinery. EPA could verify the volume of gasoline produced through 
audits of refinery production documents, cross checked with refinery 
sales documents and records from transferees of refinery gasoline.
    Under reformulated gasoline, however, this type of after-the-fact 
verification of refinery or importer reports is not possible. In 
contrast with volume information, routinely determined and kept by all 
parties to gasoline transactions, the properties relevant to 
reformulated gasoline include many that are routinely determined only a 
single time--by the refiner laboratory--and are therefore not 
susceptible to verification and cross checks.
    One commenter stated that EPA should require independent sampling 
and testing only for identified violators. EPA has rejected this 
option, however, because of difficulties in implementing such an 
approach. The limitations in determining refiner or importer cheating 
in its reports to EPA, discussed above, would make it difficult for EPA 
to know or prove any party is a violator in this way. Such refiner-
specific imposition of independent sampling and testing would most 
properly be based on proof of refiner violations involving improper 
product testing, but if such violations could be documented easily, or 
even with difficulty but reliably, there would be little need for 
independent sampling and testing to begin with. It is precisely this 
difficulty in detecting and documenting testing violations that creates 
the need for independent sampling and testing. Violations that are 
susceptible to reliable documentation, such as of the minimum and 
maximum requirements or of the time and place of use restrictions, 
would not appear appropriate predicates for imposing independent 
sampling and testing. Requirements of this type are not the primary 
focus of independent sampling and testing. Moreover, if non-testing 
violations resulted in the imposition of independent sampling and 
testing, alleged violators would likely use protracted litigation to 
avoid the consequence.
    Commenters made a number of suggestions as to changes that should 
be made in the independent sampling and testing program as proposed. 
One commenter proposed that EPA should require independent sampling and 
testing only for reformulated gasoline that meets standards on average, 
and not for reformulated gasoline that meets standards per-gallon. EPA 
rejected this option, however, for the reasons provided below.
    EPA could inspect reformulated gasoline produced to meet the per-
gallon standard, or fungible mixtures of per-gallon gasolines, and gain 
reasonable certainty that the gasolines were produced in compliance 
with the per-gallon standard. This is the type of enforcement program 
used for other gasoline rules with per-gallon standards, such as 
volatility. See 40 CFR part 80. In the absence of averaging, this is 
the type of enforcement program EPA might expect to use for 
reformulated gasoline.
    EPA believes that most reformulated gasoline found downstream will 
not be per-gallon gasoline only, however, but rather is likely to be 
either averaged gasoline or a mixture of per-gallon and averaged 
gasoline, and therefore not susceptible to downstream verification of 
refiner and importer reports. As a result, the ultimate consequence of 
removing the independent sampling and testing requirement from per-
gallon gasoline would be the loss of verification over most refiner and 
importer reports for per-gallon reformulated gasoline.
    One commenter said that EPA should require independent laboratories 
to use the same test methods as the refinery. EPA agrees with this 
suggestion, and has incorporated it in the final rule. As discussed in 
the test method section of this Preamble, EPA requires refiners and 
importers to use the regulatory test methods when meeting the refinery 
and import facility testing requirements in order to avoid erroneous 
test results due to bias among test methods. For the same reason, the 
accuracy of test results by independent laboratories would be 
compromised if independent laboratories use non-regulatory test 
methods. The commenter's suggestion is an appropriate solution to this 
possibility.
    Another commenter said that EPA should reduce the length of time 
independent laboratories are required to retain samples, from the 180-
day period in the proposal to 60 days. EPA has retained the 180-day 
sample retention period to allow EPA the opportunity to obtain portions 
of samples after it receives quarterly reports from refiners, 
importers, and independent laboratories. EPA recognizes that certain 
types of analysis results become less reliable as samples age, but 
believes there is enough information to be learned from samples older 
than 60 days to justify the 180-day sample retention 
requirement.51
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    \5\1Reid vapor pressure is the fuel parameter most susceptible 
to change due to storage time, because the more volatile fractions 
of a fuel sample may be lost if samples are not properly capped and 
stored at cold temperatures. Even in the case of RVP, however, EPA's 
experience with analyses of samples that have been stored for 180 
days has been that the RVP of samples decline only approximately 0.2 
psi, which is a change sufficiently small that EPA may continue to 
use the samples.
---------------------------------------------------------------------------

    Lastly, one commenter said that EPA should eliminate the 
requirement that independent laboratories determine certain information 
about the gasoline sampled, including the batch volume, storage tank 
identification, and the grade of gasoline. EPA proposed that 
independent laboratories obtain this information as part of the 
verification process over refiner or importer reports, and continues to 
believe it is necessary. For example, the properties of gasoline 
produced is only one part of the information necessary for 
demonstrating compliance; the volume of gasoline produced with given 
properties also is necessary. Information on storage tank and gasoline 
grade is included as a means of confirming the gasoline sampled and 
tested by the refiner or importer, and that by the independent 
laboratory, is the same.

D. Downstream Oxygenate Blending Assumptions

    EPA received various comments on the assumptions refiners and 
importers may make regarding downstream oxygenate blending for purposes 
of calculating the properties of reformulated gasoline blendstock 
intended for downstream oxygenate blending (RBOB). Under the proposal, 
and the final rule, refiners and importers of RBOB are responsible for 
meeting all reformulated gasoline standards, except the oxygen 
standard; downstream oxygenate blenders are responsible for meeting the 
oxygen standard for reformulated gasoline produced using RBOB. In order 
to determine compliance with the non-oxygen reformulated gasoline 
standards a refiner or importer must calculate the non-oxygen parameter 
values for the reformulated gasoline. To do this, a refiner or importer 
must include a value for the oxygen content the RBOB will achieve 
subsequent to downstream oxygenate blending, because the values of non-
oxygen parameters will differ based upon the type and amount of 
oxygenate blended downstream.52
---------------------------------------------------------------------------

    \5\2The impact of blending different oxygenate types and amounts 
on the non-oxygen properties of RBOB is great. VOC emissions are 
dramatically affected by changes in RVP, yet different oxygenates 
affect RVP very differently; ethanol blended above about four volume 
percent (1.5 weight percent oxygen) increases the RVP of the 
resulting gasoline by 1 psi, while oxygenates other than ethanol 
cause very little or no change in RVP.
    Similarly, toxics emissions performance and benzene are strongly 
influenced by the dilution effect caused by oxygenate blending, yet 
different oxygenates must be blended at very different volumes to 
result in the same oxygen content in the gasoline produced; to 
produce gasoline with 2.00 weight percent oxygen, for example, 
requires 5.4 volume percent ethanol, or 11.0 volume percent MTBE.
---------------------------------------------------------------------------

    EPA proposed that refiners and importers of RBOB have two options 
for the oxygen content value used in their calculations of non-oxygen 
parameters. A refiner or importer could use the actual oxygenate type 
and amount blended with the RBOB, provided the refiner or importer 
carries out a program of contractual controls and quality assurance 
sampling and testing over the downstream oxygenate blending operation. 
Under the second option, the refiner or importer could make certain 
default assumptions regarding the type and amount of oxygenate blended 
downstream. EPA proposed that this assumption must be the ``worst 
case'' assumption with regard to the oxygenate type, and volume (within 
the oxygen minimum and maximum requirements).53
---------------------------------------------------------------------------

    \5\3The worst case assumption for RVP and VOC emissions 
performance reduction would be ethanol, at the oxygen maximum level. 
For toxics emissions performance and benzene, the worst case would 
be the oxygenate providing the minimum volume (normally ethanol) at 
the oxygen minimum level.
---------------------------------------------------------------------------

    One commenter suggested that EPA should modify the nature of this 
default assumption, by allowing refiners to designate one of two 
categories of RBOB, ``ether-only RBOB'' and ``any-oxygenate RBOB.'' 
These categories would have different assumptions for oxygenate type; 
ether-only RBOB would be assumed to be blended with MTBE, and any-
oxygenate RBOB would be assumed to be blended with ethanol. 
Notwithstanding the assumption of MTBE use for purposes of compliance 
calculations for ether-only RBOB, any ether could be added downstream 
to an ether-only RBOB. However, it would be a violation to add an 
alcohol to an ether-only RBOB. This commenter stated further that the 
amount of oxygenate should be assumed to be that amount necessary to 
add 2.1 weight percent oxygen, the annual average oxygen level that 
oxygenate blenders must achieve for reformulated gasoline produced 
using RBOB when meeting the oxygen content standard on average.
    EPA has generally adopted this suggestion for the final rule, but 
in a slightly modified form.
    By adopting the approach suggested in the comments EPA is in effect 
adding an ether-only designation to the any-oxygenate designation 
implicit in EPA's proposal. EPA also is modifying to some extent the 
oxygen content and type assumptions that refiners must make if they 
rely on this RBOB designation in determining compliance with the VOC, 
toxics, and other non-oxygen content requirements of reformulated 
gasoline. First, refiners and importers that produce or import RBOB are 
required to designate the RBOB as any-oxygenate RBOB, or as ether-only 
RBOB.54 These designations are in addition to, but must be 
consistent with, the specifications for the type(s) and amount(s) of 
oxygenate that must be included in the product transfer documents for 
RBOB. Second, refiners or importers that do not meet the requirements 
for a quality assurance program over downstream oxygenate blending, 
must assume that ethanol is blended with any-oxygenate RBOB, and that 
MTBE is blended with ether-only RBOB. For both types of RBOB, the 
refiner or importer must assume that the amount used is that amount 
sufficient for the gasoline produced to have 2.0 weight percent oxygen, 
or approximately 5.70 volume percent in the case of ethanol and 
approximately 10.80 volume percent in the case of MTBE. Refiner or 
importer oversight of the downstream oxygenate blending operation is 
not required if a refiner or importer relies on these ``worst case'' 
assumptions. However, as noted below, these types of RBOB must be 
segregated from one another.
---------------------------------------------------------------------------

    \5\4Any oxygenate RBOB must meet all reformulated gasoline 
standards subsequent to blending with any of the following: ethanol, 
methanol, butanol, MTBE, TAME, or ETBE. Ether-only RBOB must meet 
all reformulated gasoline standards subsequent to blending with any 
of the following: MTBE, TAME, or ETBE.
---------------------------------------------------------------------------

    EPA believes these assumptions regarding the type of oxygenate used 
are appropriate. The principal risk to the environment under the oxygen 
use assumptions is that an oxygenate blender will blend ethanol with 
ether-only RBOB, which would result in reformulated gasoline that 
probably would support neither the toxics nor benzene properties 
claimed by the refiner or importer of the RBOB (due to an insufficient 
dilution effect), nor, in the case of VOC-controlled gasoline, the 
claimed RVP nor VOC properties (due to RVP increases from ethanol). On 
the other hand, any-oxygenate RBOB will be formulated for blending with 
ethanol, and would only improve for all properties if blended with an 
ether such as MTBE.
    Several mechanisms will help ensure ethanol is not blended with 
ether-only RBOB. Ether-only RBOB and any-oxygenate RBOB must be 
segregated throughout the distribution system to the point of oxygenate 
blending. The product transfer documents will identify ether-only RBOB 
as such, which will put each person in the distribution network, and 
the oxygenate blender, on notice that the RBOB is not suitable for 
ethanol blending. Absent a highly unusual situation, a distributor 
would not be expected to dispense ether-only RBOB into a gasoline 
delivery truck for splash blending, because ethanol is the only 
oxygenate that normally is splash blended in trucks. In addition, it is 
likely that if ethanol were blended with VOC-controlled ether-only 
RBOB, the resulting gasoline will not meet the RVP maximum or VOC 
emissions performance minimum requirements, and would be susceptible to 
detection through EPA inspections or quality assurance programs 
conducted by regulated parties.
    EPA believes the volume assumptions based on 2.0 weight percent 
oxygen are preferable to the commenter's suggested 2.1 weight percent 
basis, because there is no reason to believe any particular oxygenate 
blender will elect to use the averaged oxygen standard of 2.1 weight 
percent. In a situation like this involving default assumptions it is 
appropriate to adopt a more conservative assumption. Oxygenate blenders 
have the option of meeting either the oxygen standard for per-gallon 
compliance of 2.0 weight percent, or the oxygen standard for average 
compliance of 2.1 weight percent. EPA believes the assumption that 
oxygenate blenders will at least meet the per-gallon standard is 
appropriate, and preferable to the proposed ``worst case'' oxygen use 
assumption of 1.5 weight percent, due to enforcement mechanisms 
contained in the final rule that apply to oxygenate blenders, i.e., 
quality assurance sampling and testing and recordkeeping.
    While it is true that any single batch of reformulated gasoline 
produced by blending RBOB with oxygenate could receive the per-gallon 
minimum 1.5 weight percent oxygen, the oxygenate blender must offset 
any gasoline produced at this oxygen level with other gasoline produced 
with oxygen levels greater than 2.1 in order to meet the 2.1 average 
oxygen content standard. In addition, EPA believes it is likely that 
most oxygenate blenders will choose to meet the oxygen standard on a 
per-gallon basis, rather than on average. The testing, recordkeeping, 
and reporting requirements for an oxygenate blender who elects the 
average oxygen standard are significantly greater than for an oxygenate 
blender who elects the per-gallon standard. Moreover, EPA's oversight 
experience with the state-enforced wintertime oxygenated fuels program, 
which includes the option of meeting that program's oxygen standard 
either per-gallon or on average, is that the vast majority of oxygenate 
blenders have elected the per-gallon option in that program. This 
precedent from the oxygenated fuels program is more compelling because 
the oxygen standard in the oxygenated fuels program is 2.7 weight 
percent for both the per-gallon and average options, yet oxygenate 
blenders for the most part still chose the per-gallon option. In 
contrast, under the reformulated gasoline program the average oxygen 
standard (2.1 weight percent) is more rigorous than the per-gallon 
oxygen standard (2.0 weight percent), which is an additional reason to 
believe reformulated gasoline oxygenate blenders will choose the per-
gallon option.
    All oxygenate blenders, including a blender using any-oxygenate or 
ether-only RBOB and who uses the average oxygen standard, must follow 
the oxygen amount instructions contained in the RBOB product transfer 
documents. These instructions must specify the minimum oxygen necessary 
for the resulting reformulated gasoline to meet all per-gallon minimum 
and maximum standards. For example, a particular batch of any-oxygenate 
RBOB may specify 2.0 weight percent oxygen in order for the resulting 
reformulated gasoline to meet the 1.3 vol% benzene per-gallon maximum. 
An oxygenate blender using the RBOB in this example is required to add 
a volume of oxygenate that is large enough for the reformulated 
gasoline to have a minimum 2.0 weight percent oxygen (e.g., a minimum 
of 5.4 vol% ethanol), regardless of whether the oxygenate blender is 
meeting the oxygen standard per-gallon or on average.
    A refiner or importer of RBOB who, in lieu of producing ether-only 
and/or any-oxygenate RBOB, elects to conduct a quality assurance 
program over downstream oxygenate blending operations may use the 
actual oxygen types and amounts blended with the RBOB. If such a 
refiner or importer fails to properly carry out the quality assurance 
program, however, the RBOB will be deemed to have been blended with 4.0 
vol% ethanol (1.5 wt% oxygen), the ``worst case'' oxygenate type and 
amount that is not constrained by ``ether-only'' or ``any-oxygenate'' 
designations. Under this assumption the reformulated gasoline would 
receive a 1 psi RVP boost associated with ethanol (see Section I of the 
RIA), and the minimum dilution effect of any oxygenate at 1.5 wt% 
oxygen (for example, 1.5 wt% oxygen results from 4.0 vol% ethanol, or 
8.2 vol% MTBE). This assumption is appropriate in such a situation 
because it is possible the RBOB could be blended with ethanol at the 
1.5 wt% oxygen minimum. EPA believes it is reasonable to assume the 
RBOB will be blended with at least the per-gallon minimum oxygen volume 
of 1.5 wt% oxygen, because of the requirements imposed on oxygenate 
blenders, such as recordkeeping, and mechanisms included in the final 
rule to ensure compliance with per-gallon minimums, such as quality 
assurance sampling and testing by regulated parties and enforcement by 
EPA.

E. Averaging issues

1. Use of per-gallon and average standards
    EPA proposed that refiners and importers would be allowed to 
decide, on a per-batch basis, which regulated parameters will be 
subject to per-gallon standards and which will be subject to average 
standards. See 57 FR 13444 (April 16, 1992). For example, under the 
proposal refiners could decide for any given batch of reformulated 
gasoline to meet the benzene per-gallon standard and the toxics 
emissions reduction standard on average. Under the proposal these 
elections could be made separately for each batch of gasoline produced 
or imported, and separately for each parameter.
    EPA also intended that these per-gallon/average elections could be 
changed subsequent to the gasoline leaving the refinery or import 
facility, so that if gasoline that was intended to meet a particular 
standard on a per-gallon basis is discovered, subsequent to shipment, 
to violate the per-gallon standard, the refiner or importer could 
change its accounting records to switch the gasoline batch to the 
average standard category (provided the gasoline meets the per-gallon 
minimum or maximum).
    EPA has reconsidered this approach, and now believes that refiners 
and importers should be allowed to use either the per-gallon or the 
average standard for each parameter, but that parties may not use a 
combination of per-gallon and average standards for any parameter 
during any single averaging period. This per-gallon versus average 
election must be made separately for each refinery and for each 
importer or oxygenate blender. Under this revised approach, for 
example, a refiner could elect to meet the benzene standard per-gallon 
and the toxics emissions performance standard on average for all 
reformulated gasoline produced at a refinery, but once these elections 
are made, they would apply to all reformulated gasoline produced at 
that refinery for the entire averaging period for these parameters.
    EPA is making this change from the proposal because it is concerned 
that under the proposed approach nationwide average levels for 
regulated parameters would not achieve the levels of the average 
standards. For example, the average standard for benzene is set at 0.95 
wt%, because, among other factors, EPA estimates that this level is at 
least as stringent as the benzene level that would exist in the absence 
of averaging. EPA is concerned that under the proposed approach for 
electing per-gallon versus average standards the nationwide average 
benzene levels in reformulated gasoline would be greater than the 0.95 
wt% average standard for benzene. This result would be contrary to the 
intent of the Clean Air Act and EPA's goal that averaging should result 
in average parameter levels that are no less stringent than would occur 
in the absence of averaging.
    Section 211(k)(7)(C) of the Act provides that benzene and oxygen 
credits may not result in average levels for these parameters that are 
less stringent than would occur in the absence of using any benzene or 
oxygen credits. EPA has viewed this constraint on the use of credits as 
appropriate to employ for all reformulated gasoline parameters that may 
be met on average, including parameters other than oxygen and benzene, 
that averaging should not result in average parameter levels that are 
less stringent than would occur in the absence of averaging.
    In addition, section 211(k)(1) of the Act directs EPA to promulgate 
reformulated gasoline regulations that require the greatest achievable 
reductions in VOC and toxics emissions, taking into account cost, 
health and environmental impacts, and energy requirements. EPA has 
concluded that if refiners were required to meet the reformulated 
gasoline standards on a per-gallon basis only, that refiners would 
produce gasoline with properties equal to the standards plus ``margins-
of-safety'' necessary to ensure the gasoline in fact meets the per-
gallon standards. EPA also has concluded that the added flexibility 
afforded regulated parties through an average VOC or toxics standard 
results in the ability by refiners and importers to achieve more 
stringent standards when met on average than is possible when standards 
are met per-gallon, and the magnitude of this greater stringency is at 
least equal to the margins-of-safety that would be used with per-gallon 
standards. As a result, in implementing section 211(k)(1) EPA intends 
to establish requirements that will result in reformulated gasoline 
having VOC and toxics properties that in practice are at least equal to 
the per-gallon standards plus the margins-of-safety (which is equal to 
the average standards).
    In implementing these two statutory provisions, EPA intends that 
reformulated gasoline should have VOC and toxics emissions performance 
properties, and benzene and oxygen content properties that, regardless 
of whether credits or averaging are used, are in practice at least 
equal to the more stringent properties refiners would achieve if only a 
per-gallon standard were allowed. The level of these more stringent 
properties is at least equal to the per-gallon standard plus any 
``margin-of-safety'' refiners would employ if only per-gallon standards 
were included.
    As a result, EPA proposed and is adopting standards for average 
compliance that are more stringent than the standards for per-gallon 
compliance. Moreover, the differences between the proposed average and 
per-gallon standards reflect EPA's estimates of this per-gallon 
``margin-of-safety'' for each parameter. The relationship between 
margins-of-safety and average standards is discussed more fully in the 
1992 SNPRM, at 57 FR 13457-13458.
    EPA is concerned that if refiners, importers, and oxygenate 
blenders can elect per-gallon versus average standards on a batch-by-
batch basis, the levels of parameters in practice will not, on average, 
be approximately at the level expected if only a per-gallon standard 
were applied (equal to the per-gallon standards plus the margins-of-
safety), but rather will on average be closer to the per-gallon 
standards. EPA believes the proposed approach would have this result 
because of the ability of refiners and importers to elect to use the 
per-gallon or the average standards separately for each batch.
    For example, the per-gallon benzene standard is 1.00 vol%, and the 
average benzene standard is 0.95 vol%. Under the proposal a refiner 
could, for each batch of gasoline produced, elect to meet the per-
gallon or the average benzene standard. EPA believes that under the 
proposed approach most refiners would produce gasoline with the 
intention that the benzene level will be very close to, but slightly 
below, 1.00 vol%. If the refiner's benzene test for any given batch 
indicates the benzene level is between 0.95 vol% and 1.00 vol% (which 
refiners would be able to achieve for most batches), the batch would be 
placed in the per-gallon compliance category. If the refiner misses 
this benzene goal for any batch, and the refiner's test result 
indicates a benzene level above 1.00 vol% (1.05 vol%, for example), the 
refiner would simply place that batch in the average compliance 
category, and also produce a corresponding volume of gasoline in the 
average category (or change a previously-produced batch to the average 
compliance category) having a benzene level sufficiently below 0.95 
vol% that the two batches have an average benzene content of 0.95 vol%. 
The net result over the annual benzene averaging period would be that 
the majority of gasoline would be in the per-gallon compliance category 
with an average benzene content close to 1.00 vol%, while the minority 
of gasoline would be in the average compliance category with an average 
benzene content of 0.95 vol%. Under this example, the resulting overall 
benzene level of the gasoline produced by the refiner would be greater 
than the approximately 0.95 vol% which EPA would expect if all 
reformulated gasoline had to meet the per-gallon benzene standard.
    EPA announced in its 1992 proposal a clear intention that average 
standards be allowed in order to increase refiner and importer 
flexibility. EPA also made clear its expectation that the ``margin-of-
safety'' normally expected with a per-gallon standard not be lost 
because of averaging. This change is designed to implement this goal by 
preventing the potential unfavorable result from averaging described 
above. The final rule therefore includes a requirement that refiners, 
importers, and oxygenate blenders must elect, for each calendar year 
and for each parameter, to use only the per-gallon standard or only the 
average standard for each regulated parameter. This election must be 
made separately for each refinery.
    Under this revised approach to averaging, the average parameter 
levels for the gasoline produced by any refiner would be approximately 
the same regardless of whether the refiner elects the per-gallon or the 
average standards. For example, a refiner who elects to meet the 
benzene standard on a per-gallon basis probably will plan to produce 
gasoline with benzene levels sufficiently below the 1.00 wt% benzene 
standard to ensure that, when the production of each batch is complete, 
the refiner's benzene test results for each batch will be below 1.00 
wt%. EPA estimates that refiners subject to the per-gallon benzene 
standard would aim for approximately 0.95 wt% benzene, and as a result 
the gasoline produced by such a refiner would have an average benzene 
level of about 0.95 wt%. In the case of refiners subject to the average 
benzene standard, on the other hand, refiners probably would plan to 
produce gasoline with benzene levels that exactly equal the 0.95 wt% 
benzene standard, with the result that the average benzene level for 
the gasoline produced by such refiners would be almost exactly 0.95 
wt%.
    Under the revised approach for selecting whether to meet standards 
per-gallon versus average, therefore, the average parameter values in 
practice will be at the levels intended by EPA and Congress, and not at 
the less stringent levels that would have resulted from the proposed 
approach.
    EPA has not included a process for refiners, importers, and 
oxygenate blenders to notify EPA in advance of the per-gallon versus 
average standard elections. Rather, parties in effect will make this 
election when the first batch of reformulated gasoline is produced or 
imported each averaging period, because all reformulated gasoline 
subsequently produced or imported during the averaging period must 
follow the lead of the first batch.
2. Oxygen averaging
    a. Separate oxygen averaging for simple model VOC-controlled 
reformulated gasoline. In the proposed regulations published in 1992, 
EPA proposed that in the case of gasoline subject to the simple model 
the oxygen standard would have to be met separately for reformulated 
gasoline that is designated as VOC-controlled. The rationale for this 
category of oxygen averaging was that under the simple model the VOC 
emissions reductions required for reformulated gasoline would be deemed 
met only if the oxygen and RVP standards are each met for gasoline 
designated as VOC-controlled. Under that proposal, the gasoline quality 
surveys to be conducted in cities during the high ozone season would 
measure both RVP and oxygen of gasoline; the city would be considered 
to have passed a VOC survey only if both the oxygen and RVP levels met 
the per-gallon standards for these parameters.
    An industry group commented on this approach to VOC surveys and 
oxygen averaging. This commenter suggested that the VOC surveys should 
be based on a ``simple model'' VOC equation that would take into 
account both oxygen and RVP. Under this VOC equation, if the oxygen 
content found during a survey is below the per-gallon oxygen standard 
(worse than the standard), this deficiency may be offset by an RVP 
level that is below the per-gallon RVP standard (better than the 
standard), and vice versa. This commenter went on to suggest that under 
this approach, there would be no need to require refiners and importers 
to separately meet the oxygen standard for simple model VOC-controlled 
reformulated gasoline.55 Instead, according to this comment, the 
oxygen standard should apply only on an annual basis.56
---------------------------------------------------------------------------

    \5\5Under the 1992 proposal, the separate RVP standard would 
apply only to simple model VOC-controlled reformulated gasoline. The 
manner in which the RVP standard applies to VOC-controlled gasoline 
under today's rule is the same as in the proposals. The oxygen 
standard, on the other hand, would have to be met separately for two 
categories of reformulated gasoline under the 1992 proposal: VOC-
controlled reformulated gasoline and all reformulated gasoline.
    \5\6Under the 1992 proposal, for purposes of oxygen averaging, 
gasoline intended for use in oxygenated fuels program areas during 
the oxygenated fuels control periods (or OPRG) could not be averaged 
together with non-OPRG gasoline. The reason separate oxygen 
averaging was proposed for non-OPRG gasoline is to ensure areas not 
included in the oxygenated fuels program receive gasoline that meets 
the 2.0 oxygen content mandated by the Clean Air Act. If OPRG and 
non-OPRG gasoline could be averaged together for oxygen purposes, 
the gasoline in the OPRG areas--where 2.7 weight percent oxygen is 
required during the oxygenated fuels control period--could be used 
to offset gasoline with 1.5 weight percent oxygen intended for use 
in non-OPRG areas.
    No comments were received on this proposed treatment of oxygen 
averaging for gasoline designated as OPRG versus non-OPRG, and this 
treatment is unchanged under today's rule.
---------------------------------------------------------------------------

    In the 1993 proposal, EPA adopted the approach to VOC surveys and 
oxygen averaging suggested by this commenter. EPA has now reconsidered, 
and has included in the final rule a requirement for separate oxygen 
averaging for simple model VOC-controlled gasoline. The final rule 
retains the ``simple model'' VOC emissions reduction equation for use 
in gasoline quality surveys during the high ozone season, however.
    EPA agrees that the ``simple model'' VOC equation is appropriate 
for use in the VOC compliance surveys. This is because the surveys are 
designed to help ensure that the area in fact receives the VOC 
reductions required by the simple model RVP and oxygen per-gallon and 
averaging standards, where refiners and importers do not need to 
demonstrate compliance on average beyond the refinery or importer 
level. If the surveys show compliance on average with the expected VOC 
reductions, then there would not be a need to ``ratchet'' the RVP or 
oxygen standards. However, the surveys are an enforcement and 
compliance tool, and do not replace the simple model standards 
themselves. Even if the surveys are passed, the separate RVP and oxygen 
content standards still apply under the simple model and refiners and 
importers must comply with them. Given the inherent limits on the 
frequency and number of VOC gasoline quality surveys they can not 
reasonably be treated as a substitute for the standards themselves. It 
is reasonable to require that a refiner or importer demonstrate 
compliance with the simple model oxygen content standards that apply 
under averaging.
    Under this view, the purpose of the ``simple model'' VOC equation 
as used in VOC compliance surveys is to allow a slight variance in 
oxygen due to averaging, to be offset by a slight variance in RVP due 
to averaging, and vice versa. The ``simple model'' VOC equation is not 
intended to encourage refiners to employ a strategy of producing simple 
model VOC-controlled gasoline well below the oxygen standard, to be 
offset by gasoline well below the RVP standard. The simple model RVP 
and oxygen standards will still apply.
    Under the complex model separate oxygen averaging is not necessary 
for VOC-controlled gasoline, because there is a specific standard for 
VOC emissions performance that applies to reformulated gasoline. VOC 
emissions performance will be used under the complex model gasoline 
quality surveys.
    b. Averaging and credits under the separate oxygen categories. 
Under the final rule, simple model reformulated gasoline designated as 
meeting the oxygen standard on average must meet the oxygen standard 
during the calendar year averaging period, and must meet this standard 
separately for VOC-controlled gasoline, and for non-OPRG 
gasoline.57 This preamble section is intended to clarify the 
mechanism for meeting these overlapping oxygen requirements within a 
single refinery or oxygenate blending facility, or for a single 
importer. In addition, this section is intended to clarify the manner 
in which oxygen credits may be created, transferred, and used.
---------------------------------------------------------------------------

    \5\7 Non-OPRG reformulated gasoline is reformulated gasoline not 
intended for use in an oxygenated fuels control area during the 
oxygenated fuels control period.
---------------------------------------------------------------------------

    There are four possible categories of reformulated gasoline for 
purposes of oxygen averaging and credits:

    1. VOC-controlled, non-OPRG;
    2. Non-VOC-controlled, non-OPRG;
    3. Non-VOC-controlled, OPRG; and
    4. VOC-controlled, OPRG.58

    \5\8One industry group commented that there will be no gasoline 
in the VOC-controlled, OPRG category. EPA disagrees with this 
conclusion.
    VOC-controlled gasoline must be present in terminals in covered 
areas during the period May 1 through September 15. The oxygenated 
fuels control periods for areas that also are included in the 
reformulated gasoline program begin on October 1 or later, and last 
through either January or February, except for the New York City 
area, which lasts until April 30. Parties will supply OPRG gasoline 
to terminals in advance of October 1 in order to ``blend up'' 
terminals to the oxygenated fuels standard by that date. If this 
OPRG gasoline arrives at terminals before September 15 (which likely 
will occur), the gasoline also would have to meet the VOC-control 
standards; the product thus would be in the VOC-controlled, OPRG 
category. A similar situation will likely occur in the Spring in New 
York City, where parties will supply VOC-controlled gasoline to 
terminals in advance of May 1 in order to ``blend up'' terminals to 
meet the VOC-control standards by that date. This pre-May 1 gasoline 
thus would also be in the VOC-controlled, OPRG category.
---------------------------------------------------------------------------

    The final rule does not require that each of these categories must 
separately meet the oxygen standard. Only VOC-controlled and non-OPRG 
gasoline must each separately meet the oxygen standard. As a result, 
the oxygen averaging standards must be separately met for the following 
three classes of gasoline:

    1. All reformulated gasoline produced or imported, consisting of 
all four categories;
    2. VOC-controlled gasoline, consisting of the VOC-controlled, 
OPRG; and VOC-controlled, non-OPRG categories; and
    3. Non-OPRG gasoline, consisting of the VOC-controlled, non-
OPRG; and non-VOC-controlled, non-OPRG categories.

    In order for oxygen credit creation and use to be consistent with 
the separate classes of oxygen averaging, the creator/transferor of any 
credits must identify which of the four categories the credits 
represent. The user/transferee of credits must apply the credits to 
that same category, in order to determine if the oxygen averaging 
requirements have been met for the three classes specified above.
    By way of example, assume that Refiner A produced the following 
batches of reformulated gasoline, each of which was designated for 
average compliance for oxygen, and each of which was produced during 
the same calendar year: 

------------------------------------------------------------------------
                                                        Designations    
                                  Volume           ---------------------
           Batch No.            (gallons)   Oxygen     VOC-             
                                           content  controlled    OPRG  
                                                                        
------------------------------------------------------------------------
1.............................       100       2.3  Yes.......  No.     
2.............................       150       1.9  No........  No.     
3.............................       120       2.2  No........  Yes.    
4.............................       100       1.8  Yes.......  Yes.    
5.............................       130       2.1  Yes.......  No.     
6.............................       160       2.2  No........  No.     
7.............................       160       2.5  Yes.......  No.     
------------------------------------------------------------------------

    Refiner A then calculated the compliance total for oxygen for each 
of the four categories, by multiplying the volume of gasoline in that 
category times 2.1; and the actual total for oxygen for each category, 
by multiplying the volume of each batch in a category times the oxygen 
content of the batch, and summing the results for the category. The 
refiner's results are as follows:

------------------------------------------------------------------------
                                          Categories                    
                     ---------------------------------------------------
                          VOC-       Non-VOC-     Non-VOC-       VOC-   
                        control,     control,     control,     control, 
                        non-OPRG     non-OPRG       OPRG         OPRG   
------------------------------------------------------------------------
Compliance total....          819          651          252          210
Actual total........          903          637          264         180 
------------------------------------------------------------------------

    Refiner A transferred 52 credits in the VOC-controlled, non-OPRG 
category to another refiner, and recalculated its actual total in that 
category to be 851.
    Refiner A then calculated its compliance position with regard to 
each separate class of oxygen averaging, by calculating the compliance 
total and the actual total for the three classes of oxygen averaging: 
VOC-controlled, non-OPRG, and overall. The results of these 
calculations are as follows:

------------------------------------------------------------------------
                                          Class of oxygen averaging     
                                     -----------------------------------
                                       VOC-control   Non-OPRG   Overall 
------------------------------------------------------------------------
Compliance total....................          1029       1470       1932
Actual total........................          1031       1488       1932
Net total...........................             2         18         0 
------------------------------------------------------------------------

    Because the actual total for oxygen is, for each class of oxygen 
averaging, equal to or greater than the compliance total, Refiner A has 
met the oxygen averaging standards.
    For gasoline subject to the complex model, there are only two 
classes for oxygen averaging: non-OPRG, and overall. In consequence, 
oxygen credits must be placed into one of only two categories--OPRG, 
and non-OPRG. With these simplifications, oxygen credits for gasoline 
subject to complex model standards would be created, transferred, and 
use in a manner similar to the example described above. Because of the 
differences in oxygen categories for simple and complex gasoline, 
however, oxygen credits generated from gasoline subject to the complex 
model could not be used to achieve compliance for gasoline subject to 
the simple model.
3. NOX averaging
    EPA proposed that the NOX complex model standard would be a 0% 
emissions performance increase under Phase I of the complex model 
before 2000. Under Phase II of the complex model beginning in 2000, EPA 
proposed a range of NOX standards, from a 0% emissions performance 
increase to a 15% emissions performance decrease. Averaging was not 
proposed as a compliance option for NOX. In the final rule, EPA 
has finalized the Phase II NOX standards, and has allowed for 
NOX averaging under both Phase I and Phase II.
    Under Phase I in the final rule, the NOX per-gallon standard 
remains at the proposed level of a 0% emissions performance increase. 
The final rule also provides an average standard for NOX 
compliance of a 1.5% emissions performance reduction, which is more 
stringent than the per-gallon standard, and with an associated per-
gallon minimum NOX standard of a 2.5% emissions performance 
increase.
    EPA believes that the most appropriate interpretation of section 
211(k)(2)(A) is that the NOX emissions performance of reformulated 
gasoline should be at the level expected from a 0% NOX increase 
standard on a per-gallon basis. This approach guarantees no increase in 
NOX emissions, and is a reasonable interpretation of this 
provision. At the same time, EPA does not believe that NOX 
averaging is precluded in all cases under this provision. The text of 
section 211(k)(2)(A) is not explicit on this point, and the 
certification provision of section 211(k)(4) would appear to allow 
averaging over a slate of fuels.
    The Phase I NOX averaging provisions are designed such that 
the average NOX performance of reformulated gasoline should be the 
same under either standard. Given this result, and the discretion 
afforded the Administrator in section 211 (k)(2)(A) and (k)(4), the 
NOX averaging provisions under Phase I complex model standards is 
a reasonable way to implement this statutory requirement.
    Under Phase II, the NOX standards are different for VOC-
controlled versus non-VOC-controlled gasoline. Non-VOC-controlled 
gasoline has the same per-gallon, average, and per-gallon minimum 
standards as under Phase I. The NOX standards for VOC-controlled 
gasoline under Phase II require a NOX reduction: A 5.5% emissions 
performance reduction in the case of the per-gallon standard, and a 
6.8% emissions performance reduction in the case of the average 
standard. In addition, the average standard has an associated per-
gallon minimum NOX  standard of a 3.0% emissions performance 
reduction. The rationale for requiring NOX reductions in 
conjunction with VOC-controlled gasoline under Phase II is discussed 
more fully in section VI of the preamble.
    The general approach used for setting the average NOX 
standards, and the per-gallon NOX minimums associated with the 
average standards, is the same as for other average and per-gallon 
minimums/maximums for reformulated gasoline. The average standard is 
set at a level that is equal to the per-gallon standard plus the 
``margin-of-safety'' refiners would use to ensure compliance if only a 
per-gallon standard were allowed. EPA estimates this ``margin-of-
safety'' would be 1.5% in the case of VOC and toxics emissions 
performance. In the case of NOX emissions performance, EPA 
estimates the ``margin-of-safety'' also would be 1.5% during Phase I, 
but during Phase II would be 1.3%.
    The per-gallon minimum is included in order to cap the averaging 
range. It is set at a level that is 2.5% less stringent than the per-
gallon standard in the case of VOC, toxics, and NOX emissions 
performance. Limiting the averaging range is one of the mechanisms 
included in the final rule to ensure each covered area receives 
reformulated gasoline that on average provides the air quality benefits 
Congress intended for reformulated gasoline. The relationship between 
per-gallon and average standards, and the need for per-gallon minimums 
and maximums, are discussed in the 1992 SNPRM at 57 FR 13455-13458.
    The final rule requires that the NOX averaging standards under 
both Phase I and Phase II must be met separately for gasoline and RBOB 
that is designated VOC-controlled and for gasoline and RBOB that is not 
designated as VOC-controlled. This separate averaging is necessary in 
order to ensure that the ozone reduction benefits deriving from the 
NOX reductions occur during the high ozone season. If the VOC-
controlled and non-VOC-controlled gasoline could be averaged together 
over the entire calendar year NOX averaging period, there is the 
possibility that gasoline in the non-VOC-controlled category could have 
sufficient NOX reductions that, through averaging, gasoline in the 
VOC-controlled category would not have the intended NOX 
reductions.
    Separate NOX averaging for VOC-controlled and non-VOC-
controlled gasoline also is necessary to ensure that both the VOC-
controlled and the non-VOC-controlled categories of gasoline comply 
with the no increase in NOX emissions performance instruction of 
section 211(k)(2)(A) of the Act. If VOC-controlled and non-VOC-
controlled gasoline could be averaged together, there is the 
possibility that the gasoline in one category or the other would have 
greater NOX emissions performance reductions than is required, 
with the consequence that the gasoline in the other category could have 
a NOX emissions performance increase. Requiring separate NOX 
averaging for VOC-controlled and non-VOC-controlled gasoline prevents 
this possibility.
    In a departure from the general approach used for average 
standards, there is no gasoline quality survey prerequisite for use of 
the complex model Phase II NOX average standard for VOC-controlled 
gasoline. The gasoline quality surveys serve the purpose of ensuring 
that the minimum reformulated gasoline requirements of section 211(k) 
are met in each covered area when averaging is used. The minimum per 
gallon NOX reductions required under Phase II for VOC-controlled 
gasoline go beyond the minimum requirements of section 211(k), however, 
so there is certainty the minimum NOX requirements of section 
211(k)(2)(A) (no NOX increase) will be met in each covered area 
without the need for surveys and possible ratchets.

F. Survey Issues

1. Ratchets of Simple and Complex Standards on Survey Failure
    Under the 1992 and 1993 proposals, and under the final rule, 
refiners, importers, and oxygenate blenders that meet standards on 
average must conduct gasoline quality surveys in reformulated gasoline 
covered areas; in the event of a survey failure for a parameter, the 
standards for that parameter are ``ratcheted'' to be more rigorous. 
Under the 1993 proposal, and under the final rule, VOC and toxics 
surveys consist of a simple model portion and a complex model portion. 
Also under the 1993 proposal, EPA proposed that in the event of a 
failure of either the simple or the complex model portions of a VOC or 
toxics survey, that both simple and complex model VOC and toxics 
standards would be ratcheted.59
---------------------------------------------------------------------------

    \5\9 Surveys for benzene and oxygen include both simple and 
complex model samples, because the measurements for these fuel 
parameters are not dependent on the simple or the complex models. As 
a result, failure of a benzene survey results in ratchets of the 
benzene standard under both the simple and the complex models; and 
the failure of an oxygen survey results in ratchets of the oxygen 
standard under both the simple and the complex models.
---------------------------------------------------------------------------

    One industry group commented on this proposal to ratchet both 
simple and complex standards, stating that instead of EPA's proposed 
approach, a failure of the simple model portion of a survey should 
result only in a ratchet of simple model standards, and vice versa. The 
commenter's concern was that ratchets of both the simple and complex 
standards, when only one survey type is violated, would be unnecessary 
to achieve the surveys' purpose--to ensure gasoline quality 
fluctuations due to averaging do not result in gasoline quality in any 
covered area that is ``dirtier'' than it would be if all gasoline was 
certified to the per-gallon standards.
    With the exception of simple model VOC and toxics survey failures 
that occur in 1997, discussed below, EPA generally agrees with this 
comment. Deficiencies in gasoline quality that are identified by the 
surveys are corrected (prospectively) through ratchets of average and 
maximum standards that occur only for the class of gasoline (simple or 
complex) for which a survey is failed. Survey failures also are 
prevented through quality assurance measures implemented by refiners 
and importers intended to prevent survey failures and ratchets, and 
such measures probably would not be different if ratchets occur only 
for the class of gasoline for which a survey is failed.
    The exception to this ratchet approach in the case of simple model 
VOC and toxics survey failures in 1997 occurs because a ratchet of the 
simple model standard in such a case would not constitute an incentive 
to refiners or importers to prevent survey failures of this type. Use 
of the complex model is mandatory beginning on January 1, 1998; 
subsequent to this date, the simple model standards may no longer be 
used. As a result of this timing, any failure of a simple model VOC or 
toxics survey in 1997 would have no consequence if only the simple 
model standards are ratcheted, because ratcheted standards become 
applicable only in the year subsequent to the year of the survey 
failure. Therefore, unless both the simple and complex model standards 
ratchet in the event of a simple model VOC or toxics survey failure in 
1997, refiners and importers will have no incentive to take steps to 
avoid simple model survey failures in the year before the complex model 
becomes mandatory.
    The final rule has been modified to reflect this approach to survey 
ratchets.
2. The (Limited) Intra-Covered Area Averaging Alternative to Surveys
    Section 211(k)(7) of the Act states that the reformulated gasoline 
regulations shall provide for granting oxygen and benzene credits to 
persons who produce gasoline that exceed the standards for these 
parameters, providing for certification of gasoline based on such 
credits where they are used within the same covered area as they are 
generated, and requiring that the use of credits not result in average 
oxygen or benzene levels that are worse than would occur if no credit 
provisions were allowed. This is the statutory basis for including 
benzene and oxygen credits in the proposals and in the final rule.
    EPA believes these provisions are satisfied by refinery-based 
averaging combined with compliance surveys, but also believes they 
would allow a refiner or importer to meet the reformulated gasoline 
standards for oxygen and/or benzene (but not for other parameters) on 
average if the party is able to demonstrate the gasoline it produces or 
imports, and uses within a single covered area, meets the oxygen or 
benzene standards on average. To the extent section 211(k)(7) provides 
for such intra-covered area averaging, it would be allowed without the 
need for the gasoline quality surveys that are the general prerequisite 
for averaging.
    In order to give regulatory effect to this averaging aspect of 
section 211(k)(7) of the Act, EPA proposed regulations that would allow 
intra-covered area averaging without meeting the survey requirements. 
The proposal would have allowed this averaging approach for all 
parameters that may be averaged. The proposal did not, however, include 
enforcement mechanisms intended to ensure a party choosing this option 
does so properly, such as mechanisms to ensure, and document, the 
gasoline in question is used only in a single covered area, such as 
recordkeeping, reporting, or quality assurance requirements.
    EPA generally has retained this averaging option in the final rule 
in section 80.67(a)(2), but with several modifications. The final rule 
restricts the non-survey averaging option to oxygen and benzene only. 
This restriction is included because EPA intends to limit its 
application only to those parameters included in section 211(k)(7) of 
the Act. In addition, EPA has included in the final rule the 
requirement that any party intending to use the non-survey averaging 
option must first obtain approval from EPA through a petition process. 
The final rule specifies that the petition must describe in detail the 
mechanisms the refiner or importer will use to ensure that the gasoline 
in question is in fact produced by the refiner or imported by the 
importer, and is used only within the covered area and in no other 
attainment area or covered area. The petition also must describe the 
recordkeeping, reporting, auditing, and other quality assurance 
measures the party will use to document and report the quality of the 
gasoline used in the covered area.
    The petition would be expected to address mechanisms to establish 
with certainty the properties of the gasoline used in the covered area, 
and mechanisms to ensure the gasoline delivered for use in the covered 
area is not transported by a transferee of the gasoline (e.g., a truck 
distributor) for use in an adjoining attainment area or in another 
covered area. To the extent any of a party's gasoline is mixed with 
gasoline produced by another refiner or imported by another importer in 
the fungible gasoline distribution system, EPA believes the party would 
have serious difficulty achieving the product tracking certainties 
required for intra-covered area averaging.
    EPA believes this intra-covered area averaging approach will have 
very limited, if any, application, because it requires precise tracking 
of the quality of gasoline that is produced by a single refiner or is 
imported by a single importer and used within a single covered area. It 
was the great difficulty in this type of gasoline tracking, voiced by 
refiners and downstream segments of the gasoline distribution system, 
that gave rise to the general reformulated gasoline averaging approach 
included in the final rule--of refinery-level averaging combined with 
covered area gasoline quality surveys. Having established mechanisms to 
accomplish averaging on a nationwide basis, EPA believes it should 
sanction separate, intra-covered area averaging only if there is 
complete certainty the intra-covered area approach can be carried out 
successfully and in a manner subject to full enforcement oversight. EPA 
further believes the petition-approach included for intra-covered area 
averaging is the best means of accomplishing this certainty, without 
promulgating an additional extensive regulatory scheme.

G. Conventional Gasoline Marker

    EPA's proposed intent to designate the chemical phenolphthalein as 
the required marker for conventional gasoline has been subjected to 
reconsideration on the basis of phenolphthalein field tests conducted 
using the gasoline pipeline operated by the Amoco Oil Company in 
Mandan, North Dakota by the American Petroleum Institute and Amoco. The 
results of those field tests suggest that phenolphthalein may not 
perform to EPA's expectations for reliably distinguishing conventional 
gasoline from reformulated gasoline. Specifically, the field tests 
suggest that phenolphthalein does not adequately mix with conventional 
gasoline and may act to contaminate water, metal surfaces and/or other 
petroleum products.
    Accordingly, EPA has elected not to issue a final rule governing 
conventional gasoline markers at this time. Instead, EPA has undertaken 
further investigation of alternative markers with interested petroleum 
and chemical companies. EPA intends to publish a new proposal for the 
conventional gasoline marker, and to promulgate a final conventional 
gasoline marker rule based on this proposal. Interested parties will 
have the opportunity to comment on this proposal.

H. Responsibilities of Refiners and Oxygenate Blenders

    The introduction to this Preamble section describes the various 
responsibilities of refiners and oxygenate blenders under the 
reformulated gasoline program. Comments were received requesting 
clarification of the requirements that would apply in a case where more 
than one party is involved in a refinery or oxygenate blending 
operation.
    The final regulations define the terms ``refiner,'' ``refinery,'' 
``oxygenate blender,'' and ``oxygenate blending facility.''60 The 
definition of ``oxygenate blender'' includes a party that owns or 
controls the blendstocks or gasoline used or the gasoline produced at 
an oxygenate blending facility. This definition is necessary in 
recognition of the practice of blendstock owners to specify the type 
and amount of oxygenates to be added by another party. Because the 
blendstock owner thus exercises control over the blending operation and 
affects the qualities of the finished gasoline, it is appropriate to 
include the product owner within the definition of oxygenate blenders 
and to impose responsibility for regulatory compliance on that party 
with substantial control over the quality of the final product.
---------------------------------------------------------------------------

    \6\0 Section 80.2(h) defines refinery as ``a plant at which 
gasoline is produced.''
    Section 80.2(i) defines refiner as ``any person who owns, 
leases, operates, controls, or supervises a refinery.''
    Section 80.2(ll) defines oxygenate blending facility as ``any 
facility (including a truck) at which oxygenate is added to gasoline 
or blendstock, and at which the quality or quantity of gasoline is 
not altered in any other manner except for the addition of deposit 
control additives.''
    Section 80.2(mm) defines oxygenate blender as ``any person who 
owns, leases, operates, controls, or supervises an oxygenate 
blending facility, or who owns or controls the blendstocks or 
gasoline used or the gasoline produced at an oxygenate blending 
facility.''
---------------------------------------------------------------------------

    As a result of these definitions, there may be situations where 
more than one person meets the definition of refiner or oxygenate 
blender for a single refinery or oxygenate blending facility. For 
example, at an oxygenate blending facility there may be one person who 
owns the RBOB and oxygenate and causes those products to be combined to 
produce reformulated gasoline (who also could be a distributor or 
reseller), another person who owns the gasoline storage tanks in which 
the RBOB and oxygenate are combined (who also could be a truck or 
terminal carrier), and still another person who operates and controls 
the blending equipment at the facility on a day-to-day basis. Each of 
the parties described in this example independently meets the 
definition of oxygenate blender for the oxygenate blending facility 
described. A similar scenario, with more than one person meeting the 
definition of refiner, is possible in the case of a refinery.
    The final rule provides that each person meeting the definition of 
refiner or oxygenate blender is independently responsible that 
standards and other requirements that attach to a refining or oxygenate 
blending operation must be met. This is the same requirement that 
attaches in other motor vehicle fuel regulatory programs. For example, 
under the gasoline lead phasedown program, in cases where the lead 
phasedown standard is violated as a result of excess average lead 
content of gasoline produced, EPA holds each person meeting the refiner 
definition liable; and under the gasoline volatility program, in cases 
where the volatility standard is violated as a result of improper 
oxygenate blending, EPA holds each person meeting the definition of 
oxygenate blender liable.
    However, as in other motor vehicle fuel regulatory programs, EPA 
intends to exercise its enforcement discretion and not seek to hold 
liable parties meeting a definition in relation to a batch of gasoline 
that chose to jointly meet the requirements of the final rule. In 
practice, therefore, each requirement pertaining to an individual batch 
of gasoline must be met only once. For example, the determination of 
properties, independent sampling and testing, compliance audits, 
testing of RBOB, record keeping and reporting requirements, and 
oxygenate blender quality assurance programs need not be met separately 
by each person who meets the refiner or oxygenate blender definition 
with respect to a specific batch of gasoline or blendstock. Rather, 
within the exercise of EPA's enforcement discretion, each party is 
individually responsible for ensuring that each requirement is met at 
least once for any specific batch.
    For example, EPA would exercise its enforcement discretion and not 
seek to impose liability on a party that meets the definition of 
oxygenate blender that does not separately sample and test the gasoline 
produced or separately submit reports to EPA relating to a specific 
batch of gasoline, as long as some party with equivalent standing (an 
oxygenate blender) does conduct the required sampling and testing and 
does file a valid annual report. However, each person meeting the 
definition of oxygenate blender in this example is individually 
responsible that the required sampling and testing occurs and that the 
required reports to EPA are submitted.
    EPA anticipates that the people involved in a refining or oxygenate 
blending operation will discuss among themselves who will be 
responsible for each of the regulatory requirements. In most cases, EPA 
anticipates that the product owner will take the lead in satisfying 
requirements, though the allocation of these responsibilities is 
strictly within the province of the regulated parties involved. If a 
refinery or oxygenate blending facility requirement is accomplished by 
one person, EPA will consider the requirement to have been accomplished 
by each person who meets the definition of refiner or oxygenate 
blender. If a refinery or oxygenate blending facility requirement is 
not properly accomplished, however, EPA will consider the lapse to be a 
violation by each person who meets the definition of refiner or 
oxygenate blender. Similarly, if a standard applicable to the refinery 
or oxygenate blending facility is not satisfied, EPA will consider each 
person who meets the definition of refiner or oxygenate blender to have 
failed to satisfy the relevant standard.
    EPA anticipates that reformulated gasoline and RBOB will be 
produced exclusively, or almost exclusively, at the refinery at which 
the blendstocks are produced from crude oil, due to the complexities 
inherent in producing reformulated gasoline and RBOB. EPA believes it 
will be very difficult for a downstream party to obtain blendstocks 
with the specific mixtures of properties such that the blendstocks may 
be blended together to produce gasoline meeting the standards for 
reformulated gasoline or RBOB.
    However, if such downstream blending-refining does occur, all 
requirements attaching to refiners apply to all parties meeting the 
definition of a ``refiner''. Note that, if blendstocks are combined 
with reformulated gasoline, the reformulated gasoline standards must be 
met on the basis of the volume and properties of the blendstocks only 
and compliance may not rely on the properties of the reformulated 
gasoline to which the blendstock is added. In addition the resulting 
reformulated gasoline/blendstock mixture must meet all reformulated 
gasoline standards. In the event any party attempts downstream 
blending-refining of reformulated gasoline or RBOB, EPA intends to 
scrutinize the operation closely.
    Commenters expressed concern that, where the oxygen standard is 
being met on an average basis, all persons who satisfy the oxygenate 
blender definition may not have access to the information necessary to 
know that this standard is being met in fact. This issue was of 
particular concern for oxygenate blenders who are carriers, where the 
normal business practice is to blend oxygenate according to the 
instructions of the product owner-oxygenate blender.
    The final rule provides that oxygenate blenders will be held 
liable, inter alia, for reformulated gasoline produced for averaged 
compliance that is determined to exceed the minimum and/or maximum 
standards. The final rule also prohibits the sale, by any person, of 
gasoline that violates, inter alia, a refiners' averaged compliance 
with the standards.
    Oxygenate blenders have direct control over whether a specific fuel 
meets the minimum and/or maximum requirements of the reformulated 
gasoline program. Blenders have no control over whether that fuel is 
being produced to comply with per-gallon or averaged standards. Where 
gasoline is designated for oxygen compliance on a per-gallon basis, the 
blender may take steps to ensure that 2.0 weight percent oxygen is 
added to each batch of gasoline produced. Where gasoline is produced to 
averaged compliance, the blender is precluded from independent 
knowledge of whether the average will be met.
    EPA appreciates this dilemma faced by parties downstream of a 
refiner achieving compliance on average. However, EPA believes both 
that the requirements that blenders be held potentially liable for 
selling averaged gasoline that fails to meet the averaged standard is 
necessary and that adequate safeguards are available. Potential 
liability is necessary to effectively prevent the sale and distribution 
of non-complying product by downstream parties which possess any 
opportunity to prevent the product from being released into the 
environment.
    For example, if a carrier-oxygenate blender receives instructions 
to add less than 2.00 weight percent oxygen to RBOB (the per-gallon 
oxygen standard), the carrier should obtain the assurance of the 
product owner, in writing if possible, that the reformulated gasoline 
being produced meets the oxygen standard on average. If a violation of 
the average oxygen standard occurs involving gasoline produced by the 
carrier-oxygenate blender, and the carrier-oxygenate blender can 
demonstrate that it made this inquiry in good faith and received an 
appropriate assurance, EPA will exercise its enforcement discretion and 
not hold the carrier-oxygen blender liable for the standard violation 
unless the carrier knew, or should have known, the oxygen standard 
would not be met on average. This type of inquiry and assurance would 
be no defense for oxygenate blended outside the per-gallon minimum/
maximum standard, however.

I. Prohibitions, Liabilities and Defenses

1. Prohibitions
    The final rule contains certain prohibitions that apply to all 
parties in the gasoline distribution network, that address the per-
gallon minimum and maximum standards for reformulated gasoline and the 
restrictions related to the time and place of use for reformulated 
gasoline. Also prohibited for every party are, inter alia, the addition 
of oxygenate to reformulated gasoline (except reformulated gasoline 
that is designated for use in an oxygenated fuels program during the 
oxygenated fuels control period); the combining of reformulated 
gasoline produced using ethanol with reformulated gasoline produced 
using another oxygenate during the period May 1 through September 15; 
and (during 1995 through 1997) the combining of reformulated gasolines 
or RBOBs subject to complex model standards unless the constituent 
reformulated gasolines or RBOBs have identical baselines.
    The final rule also prohibits all parties, other than retailers and 
wholesale purchaser-consumers, from combining reformulated gasoline or 
RBOB subject to simple model standards with reformulated gasoline or 
RBOB that is subject to complex model standards during 1995 through 
1997.
    The rational for these prohibitions are discussed separately in the 
preamble sections dealing with the specific topics which result in the 
prohibitions.
    EPA received comments on its proposal to prohibit any party from 
transporting, storing, dispensing, selling, or supplying reformulated 
gasoline that does not meet a reformulated gasoline certification. The 
commenters were concerned that only gasoline that meets all 
reformulated gasoline standards would be ``certified,'' and that, as a 
result of averaging, parties downstream of the refinery would have no 
way of knowing if a particular batch of gasoline was produced to meet 
standards.
    EPA agrees with this comment, and has modified the final rule to 
limit the downstream prohibition involving reformulated gasoline 
properties to the per-gallon minimum and maximum standards that apply 
to all reformulated gasoline, regardless of whether the gasoline is 
produced to the per-gallon or average standards.61 As a result, 
downstream parties may determine if any particular gasoline batch meets 
the per-gallon minimums and maximums through sampling and testing. 
Moreover, EPA inspections conducted downstream of the refinery/importer 
will monitor compliance with the per-gallon minimums and maximums, and 
not compliance with the standards that apply to refiners and importers.
---------------------------------------------------------------------------

    \6\1For example, the refiner/importer benzene standard is 1.00 
volume percent if met on a per-gallon basis, or 0.95 volume percent 
if met on average with a 1.30 volume percent per-gallon maximum. As 
a result, no gallon of gasoline may have a benzene content greater 
than 1.30 volume percent, regardless of whether the gasoline is 
produced or imported to the per-gallon or average standard. This 
1.30 benzene maximum thus may be enforced against downstream 
parties.
---------------------------------------------------------------------------

    EPA's proposal would also prohibit refiners and importers from 
producing or importing reformulated gasoline that does not meet 
reformulated gasoline standards. Several commenters observed that the 
production alone of reformulated gasoline or RBOB that fails to meet 
required standards does not cause environmental harm, because the 
product may be corrected before it leaves the refinery. EPA generally 
agrees with this comment, and has adjusted the regulatory language to 
clarify that the prohibition against the production of reformulated 
gasoline that fails to meet standards applies only to gasoline that is 
intended for sale or use. During the course of any inspection at a 
refinery or import facility, EPA will rely on the documentation used by 
a refiner or importer to determine if any particular gasoline is 
``finished'' and therefore is intended for sale or use, or is an 
``unfinished'' product for which the refiner or importer intends 
additional blending.
    Accordingly, the final rule prohibits the manufacture, sale, 
offering for sale, distribution, dispensing, supplying offering for 
supply, transporting or causing the transportation by refiners and 
importers of finished gasoline ``intended'' for sale or use where such 
gasoline fails to meet reformulated gasoline standards. This approach 
is consistent with EPA's approach under the Lead Phasedown, Fuel 
Volatility and Diesel Desulfurization Programs.
2. Liabilities
    a. General. The final rule provides that where the gasoline 
contained in a storage tank at any facility owned, leased, operated, 
controlled or supervised by any refiner, importer, oxygenate blender, 
carrier, distributor, reseller, retailer, or wholesale purchaser-
consumer is found in violation of the prohibitions, most parties 
involved in the chain of distribution upstream of the facility found in 
violation are presumed liable for the violation.
    Carriers are presumed liable for violations arising from product 
under the control and/or custody of the carrier at the carrier's 
facility, and for violations at any facility where EPA demonstrates 
that the carrier caused the violation. Carriers who meet the definition 
of refiner or oxygenate blender have the same liabilities and defenses 
as any other refiner or oxygenate blender.
    The final rule also provides defenses against liability for each 
person presumed liable. These defenses are discussed below. For a more 
detailed discussion of the rationale for the liabilities and defenses 
established by this rule, see EPA's proposal at 57 FR 13470-13473 
(April 16, 1992).
    One commenter stated that where gasoline in a storage tank is in 
violation of the regulations, EPA should either narrow the range of 
persons presumptively liable or expand the availability of affirmative 
defenses. The comment is based on the normal industry practice of 
commingling products in common storage tanks, the number of fuel 
manufacturers that would be involved, the likelihood of commingling, 
the absence of quantitative thresholds, and the absence of a 
requirement that individual parties exercise sufficient control over 
the contents of the tank. Another commenter queried what distinguishes 
this program from other fuels programs which did not impose such 
presumptive liability.
    EPA has had extensive experience in enforcing other motor vehicle 
fuel programs under 40 CFR part 80, including the unleaded gasoline and 
gasoline volatility programs and the recent diesel sulfur program. Each 
of these other fuels programs include presumptive liability schemes 
that are very similar to the presumptive liability scheme proposed for 
reformulated gasoline.
    The liability and defense provisions of this rule are structured 
similarly to those adopted by EPA in its prior motor vehicle fuel 
programs, including the controls on leaded and unleaded gasoline, 
gasoline volatility and diesel fuel desulfurization. For those 
programs, EPA's regulations identify various persons who are presumed 
liable when violations are detected at various points in the motor fuel 
distribution system. For example, 40 CFR 80.28 identifies those persons 
responsible for violations of the gasoline volatility regulations when 
a violation is detected at refiner or importer facilities 
(Sec. 80.28(a)), at carrier facilities (Sec. 80.28(b)), at branded 
distributor facilities, reseller facilities, or ethanol blending plants 
(Sec. 80.28(c)), at unbranded distributor facilities and ethanol 
blending plants (Sec. 80.28(d)), at branded retail outlets or wholesale 
purchaser-consumer facilities (Sec. 80.28(e)), and at unbranded retail 
outlets or wholesale purchaser-consumer facilities (Sec. 80.28(f)). In 
general, all persons who could have caused a violation at a facility 
are presumed to be liable for the violation detected at the facility. 
At branded facilities the refiner is also presumed liable based on 
their ability to exercise a degree of control at these facilities. 
Various affirmative defenses are afforded to persons presumed liable, 
and in all cases the presumptions of liability are rebuttable. 40 CFR 
80.28(g). The affirmative defenses typically involve showing (1) that 
the person did not cause the violation, (2) that they either conducted 
tests showing the gasoline was in compliance when they transferred it 
to the next person in the distribution system, or that they received 
proper documentation when they received the gasoline and conducted a 
sufficient quality assurance sampling and testing program. Additional 
elements of an affirmative defense must be shown by refiners when a 
violation is detected at a branded outlet. A detailed discussion of the 
reasons for the gasoline volatility liability defense provisions can be 
found at 54 FR 11872 (March 22, 1989).
    The regulations adopted for the reformulated gasoline program 
follow this same general structure. For example, if the gasoline in a 
storage tank, or at any other point in the distribution system, is 
found to be in violation of the requirements, then the following 
persons are presumed liable: All persons (including carriers) who own, 
lease, operate, supervise or control the facility; all persons other 
than carriers who manufactured, sold, transported, or dispensed the 
gasoline found at the facility; carriers who dispensed, transported, 
supplied or stored the gasoline where EPA can show they caused the 
violation; and the refiner or importer whose brand name is displayed at 
the facility, if any. They will not be deemed liable if they can show 
(1) they did not cause the violation, (2) that product transfer 
documents indicate the gasoline in question met all relevant 
requirements, and (3) they conducted a sufficient quality assurance 
program. Additional elements must be shown by refiners or importers for 
violations at branded facilities.
    The rationale for assigning a presumption of liability to all 
contributors to a batch of noncomplying fuel is that, as with gasoline 
volatility and the other motor vehicle fuel programs, EPA is in a 
particularly poor position to know who caused a violation that is 
detected at a point in the distribution system. In the case of a 
violation found at a retail station, for example, the retailer often 
will say it has no control over the quality of the gasoline delivered 
by the distributor (or by more than one distributor) and did nothing to 
cause the violation; the distributor will say it has no control over 
the quality of the gasoline provided by the terminal and did nothing to 
cause the violation; the terminal will say it only supplies the 
gasoline received from the pipeline and did nothing to cause the 
violation, etc. EPA normally lacks the information necessary to 
establish the cause of the violation because its inspectors were not 
present when the gasoline in question moved through the distribution 
system; yet EPA has a sample that is, in fact, in violation.
    In contrast to EPA, the parties responsible for the facility, or 
for supplying the gasoline contained at a facility found to be in 
violation are, collectively, in the best position to determine the 
cause of the violation. It is these parties who are presumed liable. 
The presumption of liability normally has the desired effect of forcing 
the presumptively liable parties to cooperate in identifying the 
violation's cause, which both resolves the issue of liability for the 
party or parties actually responsible for the violation and establishes 
defenses against liability for parties not responsible. In addition, 
branded refiners or importers are presumed liable based on the degree 
of control such refiners or importers have over gasoline that is sold 
under their brand name.
    The likelihood of commingling, the absence of quantitative 
thresholds, the degree of control exercised by the branded parties 
presumed liable, and the reasonableness of a presumption of liability 
for parties involved with the production or distribution of the 
gasoline discovered in violation is the same for the reformulated 
gasoline program as it is for the gasoline volatility and other motor 
vehicle fuel programs. In both cases, EPA is confronted with a fungible 
gasoline distribution system, with various persons either involved with 
the production or distribution of the noncomplying gasoline, or 
exercising some degree of control over the downstream facility where 
the violation was detected. In both cases EPA is not reasonably able to 
locate the cause of the violation, and the regulations reasonably 
require the parties involved with the noncomplying gasoline and 
facility to bear the burden of locating the cause of the violation.
    EPA has included in the final rule liability for branded importers 
for violations found at facilities at which that importers' brand name 
is displayed. This liability is parallel with the liability presumption 
that attaches to branded refiners for violations found at branded 
facilities. This change from the proposed liability scheme is included 
because the absence of liability for branded importers created a 
potential gap in the regulatory scheme. If any party meets the 
definition of a branded importer, it is reasonable that they be treated 
equally with branded refiners.
    Moreover, EPA does not believe the scope of the liability 
provisions should be narrowed. The scope of parties presumed liable is 
designed to ensure that each party in the reformulated gasoline 
production and distribution system with any opportunity to affect the 
quality of the fuel may be held accountable for noncomplying fuel. 
Otherwise, the substantial economic incentives associated with cheating 
under this program would result in the exploitation of gaps in the 
scope of coverage.
    As a result, EPA declines to adjust the range of parties 
presumptively liable for commingled fuels violations or to adjust the 
affirmative defenses.
    Certain commenters requested clarification of the volume of 
gasoline a party must contribute to a non-complying storage tank to 
create the presumption of liability. EPA's April 1992 proposal would 
hold each party responsible for a violation detected at a storage tank, 
or at any other point in the gasoline distribution system, if the party 
was involved with any of the noncomplying gasoline. This would include 
distributors for the most recent delivery, and in most cases would also 
include distributors for the several prior deliveries. See 57 FR 13471 
(April 16, 1992). Commenters requested clarification from EPA as to 
what was meant by ``several deliveries.''
    EPA has retained the proposed language that assigns presumptive 
liability to any party that contributes ``any gasoline'' to the 
noncomplying gasoline in the batch or storage tank. There is no single 
de minimis volume that would be appropriate in every situation. In 
addition, there is no single number of deliveries that would identify 
the source for all noncomplying gasoline present in the batch or 
storage tank yielding the noncomplying sample. EPA will evaluate the 
issue of non-causation as a result of a small volume contribution to a 
non-complying storage tank on a case-by-case basis.
    One commenter observed that a downstream party receiving 
noncomplying product would be obliged to store the product until the 
owner of the product determines a solution. The commenter recommended 
that a party storing nonconforming product that has been properly re-
documented stating its actual characteristics should not be penalized.
    EPA generally agrees with this comment. The final rule prohibits, 
inter alia, the distribution, transportation, storage or sale (or offer 
to sell) of noncomplying product represented as reformulated gasoline 
and intended for sale or use in any covered area. EPA will assume, 
absent countervailing evidence, that all gasoline found in the United 
States is intended for domestic sale or use and thus subject to the 
reformulated gasoline or anti-dumping rules. Countervailing evidence to 
overcome this assumption with regard to a specific tank of gasoline 
would include a showing of the following: demonstrate that the gasoline 
is clearly identified as noncomplying product; that the noncomplying 
gasoline is segregated from other gasoline; that the storage tank 
containing the gasoline has been clearly designated as product 
unavailable for sale or distribution; that the noncomplying gasoline in 
fact has not re-entered the distribution system; and that the gasoline 
is redirected toward a process of bringing the gasoline into 
compliance. A party storing noncomplying gasoline meeting this burden 
would not be in violation of the prohibitions contained in today's 
rule.
    b. Carriers. EPA received a variety of comments objecting to the 
imposition of presumptive liability on carriers.
    Several commenters argued that the prohibitions contained in 
section 211(k)(5) of the Act identify refiners, blenders and marketers 
as the regulated parties under the reformulated gasoline and anti-
dumping programs, but does not specifically name carriers.
    Section 211(k)(1) authorizes EPA to ``promulgate regulations * * * 
establishing requirements for reformulated gasoline * * *.'' This broad 
grant of authority is the principal source of authority for the 
regulatory structure adopted for the reformulated gasoline program, 
along with the various specific requirements and authorizations found 
in other paragraphs in section 211(k). EPA has determined, in 
exercising this authority, that the most appropriate structure for this 
program is one which provides for the regulation of reformulated 
gasoline from its point of production or importation to its eventual 
transfer to the ultimate consumer.
    First, EPA's experience with various other motor vehicle fuel 
regulations, promulgated under section 211(c) of the Act, indicate that 
this is critical to the success of the program. This is based on the 
fungible nature of the gasoline distribution system, the complex 
interrelationships between the various parties involved in producing 
and marketing gasoline, and the large number of different parties that 
will be involved in bringing reformulated gasoline to the market. 
Second, the reformulated gasoline program includes a complex mixture of 
requirements, involving the regulation of several different gasoline 
components as well as the emissions performance of the gasoline. A 
cradle-to-grave approach is necessary to ensure that the air quality 
benefits from this program are actually achieved in use, given the 
large number of parties who will have custody or control of a batch of 
reformulated gasoline, and the potential that their actions could 
adversely affect the emissions reductions expected from the 
reformulated gasoline program. This could occur, for example, because 
the quality of gasoline has been changed, or because it has been 
dispensed or used at an improper time or place. For these reasons, EPA 
believes that it is proper to regulate all parties involved with the 
production, distribution and sale of reformulated gasoline.
    At the same time, EPA has assigned different responsibilities to 
different parties in the production and distribution system. EPA 
proposed and has decided to adopt final rules including carriers as a 
regulated party, and assigning them responsibilities commensurate with 
their unique role in the gasoline distribution system. EPA believes 
this is a reasonable exercise of its broad grant of authority under 
section 211(k)(1).
    EPA has determined that the regulation of carriers--pipelines, 
barge operators or truck carriers--is necessary to accomplish the goal 
of cradle-to-grave oversight monitoring and enforcement. This 
determination is based on the potential for carriers to cause 
violations of the reformulated gasoline regulation, the need to impose 
a duty on carriers to exercise care in transporting or storing 
reformulated gasoline, and the need for EPA to be able to determine the 
source of violations within the program. For example, carriers possess 
the potential to cause violations of this program by commingling 
inappropriate grades of gasoline, delivering conventional gasoline into 
a covered area, or by carrying non-VOC controlled gasoline in a storage 
facility over from a non-VOC control period into a VOC control period 
and selling or distributing that product. In each of these examples, 
the carrier would be directly responsible for causing the violation. 
EPA believes that the presumption of liability proposed in the final 
rule effectively imposes a duty of care on carriers to avoid these 
violations. Further, as discussed in the economic analysis accompanying 
this final rule, the costs associated with carrier compliance are 
reasonable and have been designed to provide carriers with the minimum 
oversight costs necessary to accomplish the goals of this program.
    Certain carriers argue that Congress did not authorize the 
regulation of carriers in this program as the prohibition found in 
section 211(k)(5) of the Act only applies to refiners, importers, 
distributors and marketers, but not carriers. Therefore, it is argued, 
EPA may not regulate carriers.
    EPA disagrees with this argument. First, it misinterprets the 
prohibitions adopted by Congress in section 211(k)(5). The statutory 
prohibitions found in that paragraph are self-effectuating once EPA 
promulgates regulations establishing the requirements for certification 
of reformulated gasoline. Section 211(k)(5) does not limit EPA's 
authority to establish various additional regulatory prohibitions, as 
necessary, in the exercise of EPA's rulemaking discretion under section 
211(k)(1). It also does not limit EPA's authority under section 
211(k)(1) to regulate, as appropriate, the activities of various 
persons in the gasoline distribution system, including carriers.
    In any case, EPA believes that carriers are reasonably included in 
the term ``marketers'' as used in section 211(k)(5). That term is vague 
and ambiguous, and EPA reasonably interprets it to include all persons 
regulated by EPA in the reformulated gasoline program including 
carriers.
    The Act does not define the term marketer for purposes of section 
211(k), and while that term is used in various other provisions of the 
Act, it is only defined for purposes of one unrelated provision, 
section 324 (involving responsibility for gasoline vapor recovery 
systems at small volume retail outlets). The term generally appears to 
indicate a broad category of persons involved in the gasoline 
distribution system, a generic phrase with a catch-all meaning. See 
sections 211(h)(4), 211(1) and 211(m)(2). As used in those provisions, 
the scope of the term may be broader or narrower, depending on how 
detailed Congress made the list of parties covered by each provision. 
For example, the long list of parties referenced in section 211(h)(4) 
makes it clear that ``marketer'' as used there means an undefined 
category of persons other than distributors, blenders, resellers, 
carriers, retailers, or wholesale purchaser-consumers, while in 
sections 211(1) and (m)(2) the term means an undefined category of 
persons other than refiners. The legislative history for section 211(k) 
fails to shed any light on Congress' intent.
    The generally accepted meaning of the term ``marketer'' is ``one 
that deals in a market.'' Webster's Ninth New Collegiate Dictionary 
(1990). A carrier would reasonably fall within this definition. Given 
the lack of a clear definition in the Act for this vague term, the 
indications that Congress intended it to have a somewhat broad, catch-
all meaning, and the reasons provided above supporting EPA's inclusion 
of carrier's as regulated parties in the reformulated gasoline program, 
EPA has reasonably determined that carriers are included in the term 
``marketer'' as it is used in section 211(k) of the Act.
    Various commenters claimed that it was inappropriate to impose a 
presumption of liability on carriers, based on their unique 
circumstances. They noted that carriers do not take title to or own the 
gasoline, have contractual obligations to maintain the integrity of the 
shipment, only act in accordance with instructions from the product 
owner, and have incentives to not tamper with the product, as it would 
expose them to liability and would prejudice their relationships with 
both the shipper and purchaser. Commenters stated that carriers lack 
any economic incentive to violate the reformulated gasoline 
requirements, and any action that does not violate these requirements 
is only in response to the gasoline owner's instructions. Commenters 
also stated that carriers cannot refuse such instructions except for 
clear violations of the law.
    Barge operator-carriers noted that the risk of accidental 
contamination for barge operator-carriers is virtually nonexistent due 
to contract obligations to maintain cargo integrity and the product 
testing that occurs before and after shipping. They also argued that 
the volume of product in a barge-tank would dilute any trace 
contaminants such that there was no practical risk of a violation of 
the reformulated gasoline requirements from contamination.
    EPA recognizes that carriers occupy a role that is somewhat unique 
in the gasoline distribution system. In general, EPA agrees that there 
is limited economic incentive for carriers to tamper with the quality 
of gasoline, in that carriers do not own the gasoline they ship or 
store and would not profit by taking advantage of the price 
differential between complying and noncomplying gasoline. At the same 
time, there are still significant opportunities for carriers to 
directly cause violations of the reformulated gasoline program. For 
example, a carrier's delivery territory may span a boundary between an 
area requiring reformulated gasoline and an area that may receive 
conventional gasoline. Misdelivery of conventional fuel into the 
reformulated gasoline covered area would be a violation of the 
prohibitions of the reformulated gasoline program. Other situations 
where a carrier can cause a violation include a terminal-carrier or 
truck-carrier who mixes conventional gasoline and reformulated gasoline 
and transfers the resulting gasoline as reformulated; who mixes 
reformulated gasoline designated as VOC-controlled with non-VOC-
controlled gasoline and transfers the resulting gasoline as VOC-
controlled; who delivers gasoline designated for use in VOC-Control 
Region 1 to a retail outlet located in VOC-Control Region 2; who mixes 
oxygen program reformulated gasoline (OPRG) and non-OPRG reformulated 
gasoline and transfers the mixture as OPRG; or who mixes simple and 
complex model reformulated gasoline. In these examples, EPA would hold 
the carrier liable if the carrier improperly delivered the gasoline or 
mixed the gasolines that should have been segregated. Note that the 
gasoline owner in each of these examples also would be presumed liable 
for the violation.
    Based on these circumstances, the presumption of liability assigned 
to carriers is much more limited than that assigned to any other 
regulated party. Like other parties, a carrier is liable for violations 
that occur at its own facility. However, unlike other regulated 
parties, carriers are not liable for violations detected at other 
facilities, unless EPA can show that the carrier caused the violation. 
This is a significant reduction in the scope of the presumption of 
liability as compared to the scope proposed for carriers, and reflects 
EPA's balancing of the unique characteristics noted by carriers and the 
need to prevent carriers from adversely affecting the characteristics 
of reformulated gasoline. This parallels the presumption of liability 
for carriers adopted by the Agency in the gasoline volatility 
regulations, and approved by the court in National Tank Truck Carriers, 
Inc. v. U.S.E.P.A., 907 F.2d 177 (D.C. Cir. 1990).
    EPA acknowledges that carriers may operate on the instructions of 
the product owner. In fact, several commenters suggested that carriers 
are obligated to not deviate from the owner's instructions regardless 
of whether those instructions are consistent with the reformulated 
gasoline rules.
    However, the Interstate Commerce Commission62 has advised EPA 
that carriers are not obligated to store or transport gasoline in a 
manner that violates applicable laws. The ICC view of carrier 
obligation allows carriers to self-determine which loads they will 
store or carry. The ICC also observed that a carrier's obligation to 
accept tenders is superseded by an obligation to comply with applicable 
law, including regulations that implement the Clean Air Act Amendments 
of 1990. Accordingly, carriers are not placed in an untenable position 
by refusing to store or transport gasoline that does not comply with 
the reformulated gasoline requirements.
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    \6\2Per telephone conversation with Charles Wagner, Deputy 
Director, Operations and Enforcement Section, Office of Compliance 
and Consumer Assistance, Interstate Commerce Commission.
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    c. Carriers acting as refiners or oxygenate blenders. The final 
rule provides for a presumption of liability for violations found 
downstream of a refinery or oxygenate blending facility for all persons 
who meet the definition of refiner or oxygenate blender, including 
carriers who meet this definition.63
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    \6\3 Liabilities and defenses for refiners and oxygenate 
blenders are discussed generally in the section on refiners and 
oxygenate blenders above.
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    A presumption of liability is necessary in the case of a carrier 
acting as a refiner or oxygenate blender because in both cases the 
carrier plays a significant role in the actions that establish or 
change the quality of reformulated gasoline. For example, the practice 
of splash-blending oxygenates and gasoline in gasoline delivery trucks 
is a common form of gasoline blending, and the trucks used for splash 
blending often are operated by truck carriers. Frequently, the carrier 
truck driver directly controls the volumes of gasoline blendstock and 
oxygenate that are combined in the truck. In consequence, the carrier 
is directly responsible for the quality of the finished gasoline in 
such a splash-blending operation.
    Commenters observed that in other fuel regulatory programs, 
carriers acting as refiners or oxygenate blenders are specifically 
excepted from presumptive liability for violations determined at 
facilities downstream from the refinery or oxygenate blending facility. 
This is not accurate. Carriers who meet the refiner or oxygenate 
blender definition are treated the same under the reformulated gasoline 
regulations as under other motor vehicle fuel programs. The definition 
of a ``refiner'' is consistent throughout EPA's fuel regulatory 
programs, and in all these programs a carrier who meets the refiner 
definition is subject to the same liability as any other person who 
meets the refiner definition. Oxygenate blenders are simply a sub-
category of refiners who produce gasoline only by oxygenate blending. 
As a result, carriers acting as oxygenate blenders are regulated 
consistently with any other oxygenate blender under the program.
    Carrier-commenters argued that the owner of the gasoline and 
oxygenate used in an oxygenate blending operation should be responsible 
for meeting the requirements for sampling and testing, compliance 
record keeping, reporting and auditing, because only the owner can 
remedy violations. For the reasons discussed in the refiner and 
oxygenate blender section of this preamble, EPA has determined that 
each person who meets the oxygenate blender definition is individually 
responsible for ensuring that the requirements that attach to an 
oxygenate blending operation are met. However, as discussed above, 
carrier-oxygenate blenders and product owner-oxygenate blenders may 
reach agreements on the allocation of responsibilities for meeting the 
oxygenate blending requirements within the scope of EPA's enforcement 
discretion.
3. Defenses
    The final rule specifies that a regulated party may rebut the 
presumption of liability by demonstrating (1) that it did not cause the 
violation, (2) that the product transfer documents account for all the 
gasoline in question and indicate that the product complied with all 
applicable standards, and (3) that the party conducted an acceptable 
quality assurance program of periodic sampling and testing.
    When a non-complying product is found at a facility operating under 
a refiner's brand name, the refiner must also demonstrate additional 
elements for a valid defense. This includes a showing that the 
violation was caused by a party in violation of a contractual 
understanding imposed by the refiner to prevent such action.
    The defenses available to regulated parties to rebut the 
presumption of liability are closely patterned after those adopted for 
other motor vehicle fuel regulatory programs under 40 CFR part 80, 
including the gasoline volatility program. The presumption of liability 
is rebuttable, including the imposition of vicarious refiner liability 
for violations detected at branded facilities. This regulatory 
structure is fully consistent with the relevant judicial decisions in 
this area. See Amoco Oil Co. v. Environmental Protection Agency, 501 
F.2d 270 (D.C. Cir. 1976) (``Amoco II''), and National Tank Truck 
Carriers, Inc., supra.
    As discussed above, carriers not acting as refiners or oxygenate 
blenders will not be deemed presumptively liable for violations found 
downstream of the carrier facility, unless EPA shows that the carrier 
caused the violation. Accordingly, such carriers will not be required 
to present a defense to such downstream violations. However, where a 
violation is found at a carrier's facility, the carrier must meet the 
defense elements in order to avoid liability. Note that EPA intends to 
exercise its enforcement discretion to permit a carrier to rely on a 
properly conducted quality assurance program undertaken by the product 
owner to satisfy the quality assurance program defense element.
    One commenter observed that the proposed regulations fail to 
account for carriers making consecutive deliveries to reformulated 
gasoline and conventional gasoline markets. Such carriers may appear to 
have complying and non-complying product on board, according to the 
commenter.
    The issue raised by this commenter applies not only to carriers, 
but potentially to any party who transports gasoline (e.g., a 
distributor or reseller). EPA does not consider the transportation of 
both reformulated and conventional gasoline in the same vehicle to be a 
violation provided that the destinations of the different products are 
proper and documented, and the products are properly segregated. 
Obviously, any party in such a situation should use care that the 
gasolines are not mixed and are properly delivered.
    Various commenters objected to the proposal that refiners would be 
presumptively liable for downstream violations, including those found 
at downstream facilities that display the refiner's brand name. One 
commenter stated that the proposed regulations would impose an 
irrebuttable presumption of liability in violation of the Due Process 
clause of the Constitution and Amoco Oil Co. v. EPA, 501 F.2d 722 (D.C. 
Cir. 1974) (``Amoco I'') and Amoco II. The commenter claimed that the 
presumption was in practice irrebuttable due to product fungibility and 
the very high cost of testing required to avoid liability. The 
commenter also observed that refiners lack sufficient control over 
downstream parties to lawfully impose vicarious liability on the 
refiner, in part due to the Petroleum Marketing Practices Act. EPA 
disagrees.
    The defense elements established in the final rule set forth 
reasonably attainable criteria to rebut a presumption of liability for 
violations detected downstream of a refinery. The final rule provides 
that refiners must demonstrate: (1) That the refiner did not cause the 
violation; (2) that product transfer documents account for all of the 
gasoline found in violation and indicate that the gasoline met relevant 
requirements; and (3) that the refinery has conducted a quality 
assurance sampling and testing program. Where the violation is found at 
a facility carrying the refiner's brand name, the refiner must show, in 
addition, that the violation was caused by: (1) An act in violation of 
law; (2) or an action in violation of a contractual obligation imposed 
by the refiner; or, (3) the action of a carrier or other distributor 
not subject to a contract with the refiner but engaged by the refiner 
for the transportation of gasoline, despite specification or inspection 
of procedures and equipment by the refiner reasonably calculated to 
prevent such action.
    Addressing the above defense elements seriatim, EPA believes the 
information necessary to demonstrate that the refiner did not cause a 
violation determined downstream is reasonably within the control of a 
refiner through review of its production testing and shipping records. 
Further, refineries may reasonably provide in contracts with downstream 
parties for the refiner to conduct quality assurance sampling and 
testing at the downstream facility. Such testing would be limited to 
determining that maximum/ minimum and other applicable standards are 
met.
    Branded refiners, as discussed elsewhere in this preamble, are held 
to a more stringent standard for establishing a defense to downstream 
violations due to the enhanced control such refiners have over branded 
downstream parties. First, EPA anticipates that a brand refiner is able 
to exercise sufficient control over its downstream affiliates so as to 
prevent any violation other than one arising from a violation of law 
(other than a violation of this final rule). EPA also anticipates that 
a branded refiner will possess contractual leverage to be able to 
impose contractual obligations on downstream parties necessary to 
assure that violations will not occur under the terms of the contract. 
Finally, EPA anticipates that a brand refiner will possess contractual 
leverage to impose handling requirements on non-brand carriers or other 
distributors not subject to the refiner's brand but engaged by the 
refiner for the transportation of gasoline, and to allow specification 
or inspection of procedures and equipment by the refiner reasonably 
calculated to prevent such action. As with branded downstream parties, 
EPA believes that a conservative quality assurance program will deter 
violations downstream of the refiner by creating an atmosphere of 
oversight presence and quality assurance by the refiner. Further, EPA 
believes that quality assurance is in the refiner's self-interest in 
guaranteeing the quality of its product in the market.
    One commenter suggested that downstream quality assurance 
requirements might adversely affect the positions of independent 
distributors by allowing branded refiners to tighten up on contracts 
with the independents and force them out of the market. However, EPA 
believes that most distributors will conduct quality assurance programs 
regardless of any involvement by branded refiners, because of the 
distributor's potential for liability for violations that exists 
independent of the refiner's liability, and because most distributors 
are concerned about product quality for reasons that are independent of 
the reformulated gasoline requirements. As a result, EPA does not 
believe that contractual provisions requiring quality assurance imposed 
by branded refiners constitute a significant additional burden on 
distributors. Moreover, the defense provisions related to branded 
refiners requires contracts only with branded resellers or retailers. 
As a result, refiners are not required to impose contractual quality 
assurance provisions on distributors who are not identified with the 
refiner's brand name.
    EPA believes that the result of the final rule's liability and 
defense scheme is that refiners who maintain careful compliance with 
this rule and conduct an appropriate quality assurance program over 
their branded facilities, including periodic sampling and testing, will 
not be held inequitably liable for violations caused by downstream 
parties who display the refiner's brand name. Because many of these 
elements of defense call for the refiner to exercise precaution through 
normal contractual instruments, EPA anticipates that the cost of these 
measures will be minimal and consistent with the costs and expenses 
experienced in the gasoline volatility and lead phasedown programs.
    The rebuttable presumption of liability in the reformulated 
gasoline program is consistent with the holdings in Amoco I and Amoco 
II. The liability provision of the unleaded gasoline regulations that 
was challenged in Amoco I and held by the Court to be improper imposed 
strict vicarious liability on parties upstream of a retail facility at 
which a violation had been determined. The Amoco I court held that any 
presumption of liability must be rebuttable. Amoco II held that a 
presumption of refiner liability must be rebuttable for violations 
resulting from the sale of leaded gasoline as unleaded by retail 
facilities owned and leased by the refiner. As a result of the Amoco I 
and Amoco II decisions, the unleaded gasoline regulations were revised 
to allow refiners to rebut a presumption of liability even where the 
refiner owned or leased a retail outlet found in violation.
    All presumptions of liability contained in the reformulated 
gasoline regulations are rebuttable. As in other 40 CFR part 80 fuels 
programs (unleaded gasoline, volatility, and diesel sulfur), the final 
reformulated gasoline rule provides for more stringent refiner defense 
elements in the case of a violation at a facility displaying that 
refiner's brand name, as opposed to a case where the facility in 
violation does not display the refiner's brand name. Nevertheless, the 
final regulations provide that the refiner in such a brand-name-
facility case may rebut a presumption of vicarious liability by showing 
that the violation was caused by a party other than the refiner. 
Accordingly, the final rule does not create strict vicarious liability 
by any party, and is consistent with the teachings of Amoco I and Amoco 
II.
    One commenter stated that a retailer could prove the first retailer 
defense element (that the retailer did not cause the violation) only by 
proving the second retailer defense element (that product transfer 
documents that meet relevant requirements account for all gasoline 
purchased and sold by the retailer), and therefore the element should 
be deleted. EPA agrees that one of the most common ways retailers show 
non-causation is by identifying the source of all gasoline present at 
the retail outlet, and showing that this product was represented by the 
distributor(s) or reseller(s) to meet all relevant requirements. In 
enforcing other motor vehicle fuels programs where retailers have often 
used this type of evidence to proffer a defense, however, EPA's 
experience has been that retailers are rarely found to be ultimately 
liable unless the retailer made decisions to commingle gasolines in the 
retail tank that should have been segregated. It is possible that a 
retailer's proferring of product transfer documents may be inadequate 
to establish a complete defense to an allegation of a violation. For 
instance, the retailer may have knowledge, independent of the product 
transfer documents, that should lead the retailer to understand that 
the gasoline's qualities are not as represented on the documents. In 
such a circumstance, the retailer would be required to show by means 
other than the documents that it did not cause the violation. 
Accordingly, the elements of defense for a retailer may overlap, and as 
a result are not redundant. The adequacy of a defense will be 
determined on a case-by-case basis.
    One commenter objected that a party would have to test gasoline 
received by the party following each receipt, and test the gasoline 
delivered to other parties following each delivery, in order to 
absolutely prove the party did not cause a violation for which the 
party could be presumptively liable. EPA agrees that the most 
conclusive proof for non-causation for any possible allegation of 
liability would be test results of the type described by the commenter. 
In fact, this is the type of testing that commonly is carried out by 
the parties where large volumes of gasoline are involved. Refiners and 
importers conduct such testing of the gasoline they produce or import, 
as do other parties such as pipelines and terminals when receiving or 
shipping large-sized batches of gasoline. In situations where the 
volume of gasoline received or shipped/delivered is small, EPA does not 
anticipate that every-batch testing is needed to show non-causation. 
EPA believes that parties who deal in small-sized gasoline batches are 
able to effectively monitor the quality of gasoline received and 
shipped/delivered and establish the cause of violations that occur 
through careful attention to program requirements, discretion in the 
selection of business partners, and good quality control practices 
including a program of periodic sampling and testing. This belief by 
EPA is based on its experience in enforcing other motor vehicle fuels 
programs.
    One commenter stated that the requirement of a quality assurance 
program in addition to all other testing and audit requirements, is 
redundant.
    EPA believes that quality assurance sampling and testing is 
essential so that there is an incentive for parties to adequately 
monitor the quality of gasoline received and shipped/delivered. The 
principal purpose of quality assurance sampling and testing, in EPA's 
view, is to alert a party to gasoline quality problems so that the 
party may correct the problem and the conditions that caused the 
problem before EPA documents any violations. Other enforcement 
mechanisms that are included in the reformulated gasoline program are 
important for their own reasons, but EPA does not believe they 
eliminate the need for sampling and testing.
    In addition, the existence of an adequate quality assurance program 
is a separate element of the defense to a presumption of liability 
because EPA does not feel confident that a party did not cause a 
violation absent such evidence. For example, even if one party can show 
that another party was the apparent or primary cause of a downstream 
violation, that does not on its own show that the first party did not 
also cause the violation. The fungible nature of the gasoline 
distribution system could well lead to situations where more than one 
and perhaps several parties contributed to a violation detected 
downstream. Absent a sufficient quality assurance program, production 
of proper transfer records, and any other evidence needed to show that 
the first party did not cause the violation, EPA does not believe that 
the first party has properly rebutted the presumption of liability. A 
quality assurance program, which involves sampling and testing the 
gasoline while it is in the hands of a party, is reasonably considered 
a necessary, minimum element of properly showing that a party did not 
cause a violation and thereby rebutting a presumption of liability.
    Refiners, importers and oxygenate blenders are required to conduct 
sampling and testing under the regulations, as well as have independent 
audits performed. For those parties, the required sampling and testing 
may well satisfy the quality assurance element of a defense to 
presumptive liability and is therefore not redundant. For those parties 
it only calls for additional sampling and testing where the required 
sampling and testing would not be adequate to satisfy that element of 
the defense. For all other parties, the quality assurance element of a 
defense is not redundant as there is no required sampling and testing 
for other parties.
    Nevertheless, sampling and testing by parties other than refiners, 
importers, and oxygenate blenders is not required by the final rule, 
but rather is a voluntary defense element only. If a party believes 
that no violations will occur as a result of other program 
requirements, the party could choose to avoid a quality assurance 
sampling and testing program. Such a decision would, however, increase 
the risk of violation attributable to the party. Without a quality 
assurance sampling and testing program a party would have scant basis 
for knowing if the gasoline it receives and ships or delivers meets 
standards. In addition, in the event the party's confidence is 
misplaced and EPA documents a violation for which the party is presumed 
liable, the party would be unable to establish a defense against that 
liability.
    A commenter requested that EPA define the frequency of sampling and 
testing that EPA would consider sufficient to satisfy the quality 
assurance defense element. Another commenter recommended that EPA 
should base enforcement actions exclusively on EPA testing using 
regulatory test methods and not on oversight sampling and testing by 
regulated parties.
    EPA is reluctant to specify the details of a ``sufficient'' quality 
assurance sampling and testing program, because the type of program 
that is sufficient in any situation depends on the particular facts of 
that situation. In addition, EPA believes regulated parties are closest 
to their own operations and are therefore in the best position to judge 
the program that is adequate. Typically, such a program should include 
sampling and testing of a representative sampling of the gasoline the 
party receives and ships or delivers; identification of any sample that 
is in violation of relevant standards, and for such a sample, 
correction of the violation and the conditions that caused the 
violation; and an increased rate of sampling and testing when 
conditions indicate an increased likelihood of violations (e.g., 
violating samples found).
    In the case where a violation is detected through a party's quality 
assurance program, and the party corrects both the violation and the 
conditions that caused the violation without any involvement by EPA, 
EPA generally forgoes any enforcement on the basis of the party's test 
results. If the party does not follow-up on violations in this manner, 
however, EPA may initiate an enforcement action on the basis of the 
party's test results.
    Carrier-commenters objected to the quality assurance sampling and 
testing defense element as applied to carriers. Commenters stated that 
a carrier is in a uniquely weak position in the gasoline distribution 
system to verify the characteristics of product received in order to 
rebut an assertion that the carrier caused a violation.
    EPA recognizes that the term ``carrier'' covers an array of 
carriage and distribution operations. Pipelines, barge operations, ship 
operations, tank trucks, and storage facilities may all meet the 
definition of a carrier. Each type of carrier has unique capacities for 
conducting quality assurance sampling and testing programs. For 
instance, pipelines, barge and ship carriers, and storage facilities 
typically deal with large volumes of gasoline. EPA believes that these 
high volume operations already conduct sampling and testing programs 
during the normal course of business that normally will satisfy the 
quality assurance defense element. In fact, commenters observed that 
barge carriers typically sample and test loads both before and after 
shipment to ensure the integrity of their product.
    The unique circumstances of tank truck carriers have been 
considered in the final rule. Truck carriers, like other carriers, will 
be asked to present evidence of a quality assurance program only where 
EPA documents a violation at the carrier's facility.64 In 
addition, truck carriers may rely on a properly conducted quality 
assurance program carried out by another party over the carrier's 
operation (most likely the product owner). Moreover, quality assurance 
sampling involving gasoline delivery trucks may be accomplished using 
samples collected at retail stations following truck deliveries 
(discussed more fully above), providing carriers with additional 
flexibility in meeting this defense element. It is also relevant that 
under the existing gasoline volatility and diesel sulfur programs 
carriers, including truck carriers, are required to conduct quality 
assurance sampling and testing in order to establish a defense for 
violations. As a result, the carrier quality assurance defense element 
in the reformulated gasoline program is merely an extension of the 
carriers' current quality assurance responsibilities.
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    \6\4Carriers are liable under two circumstances: when a 
violation is found at the carrier's facility, and where EPA shows 
the carrier caused a violation found elsewhere. The quality 
assurance defense element would have application only in the first 
circumstance, however, because in a case where EPA establishes the 
carrier caused a violation the carrier would not be able to 
establish a defense even if the carrier conduced a quality assurance 
program.
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    EPA intends to exercise its enforcement discretion to provide 
carriers with flexibility to satisfy the quality assurance sampling and 
testing defense element if another party, most likely the product 
owner, carries out an adequate sampling and testing program over the 
gasoline stored or transported by the carrier. The product owner is 
required to conduct a quality assurance program in order to establish a 
defense against its own liability, so that an arrangement between the 
carrier and the product owner in this regard would be little additional 
burden for the product owner.
    Carriers also may seek contractual indemnification from the product 
owner against liability for violations detected at the carrier's 
facility. EPA believes that the traditional allocation of risk through 
contract is an appropriate method for carriers to safeguard their 
interests within the fuel distribution system. Contractual 
indemnification combined with a contractual commitment by the product 
owner to carry out an effective quality assurance sampling and testing 
program would provide a carrier with reasonable protection against 
financial exposure for liability for violations for which the carrier 
is not responsible.
    EPA has analyzed the costs associated with voluntary carrier 
sampling and testing. First year per-party costs65 are calculated 
to be approximately $2,672 for pipelines, $1,042 for truckers acting as 
oxygenate blenders, and $517 for other truckers. Costs during 1996 and 
1997 are estimated at $2,437, $673 and $480, respectively. Moreover, 
EPA assumes that many of these costs will be shared among carriers and 
the owners of the product. EPA has concluded that these costs are 
reasonable given the importance of the quality assurance program to the 
success of the reformulated gasoline program.
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    \6\5First year costs include: analyzing RFG regulatory 
provisions; planning activities; training; field testing for 
conventional gasoline marker; sampling and testing for reform 
properties (though this is partially a customary and usual business 
practice by virtue of required testing for RVP and oxygenates for 
federal and state programs). Pipelines already routinely test for 
other properties as well.
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4. Alternative Enforcement Options
    Several commenters offered alternatives to EPA's proposed 
enforcement scheme. The alternatives proposed include: EPA should rely 
on cease and desist orders; EPA should only presume liability where a 
violation is found and allow private contract law to insure the 
violator against upstream causation; EPA should require willful and 
knowing negligence for vicarious refiner liability; and EPA should 
impose sampling and testing requirements on all tank truck carriers, 
even if sampling and testing is already performed by an upstream party 
for the carrier, to avoid economic advantage over for-hire carriers.
    EPA has considered these alternative enforcement schemes and has 
determined to implement the scheme as proposed or modified and 
discussed above. This enforcement scheme is unified, consistent with 
EPA's enforcement in the gasoline volatility, diesel sulfur and lead 
phasedown programs, and focusses enforcement attention at the points in 
the distribution system where the pollution forming potential of 
gasolines may be affected by parties in the manufacturing and/or 
distribution process. A stringent compliance oversight and enforcement 
program, as described in detail in the final rule and this preamble, is 
necessitated by the significant financial incentives that exist for 
parties to not comply. EPA's experience in the lead phasedown and 
gasoline volatility programs has been that financial incentives will 
result in cheating and that a vigorous enforcement presence will result 
in diminished incidence of non-compliance. Accordingly, EPA believes 
that an enforcement program relying on cease and desist orders alone 
for encouraging compliance by parties would not be effective in 
deterring violations and would fail to remove economic incentives for 
non-compliance. Further, EPA believes that reliance on private contract 
law to insure the violator against upstream causation would be 
ineffective in providing for maximum compliance due to the uncertainty 
of the resolution of contract disputes and the amenability of such 
disputes to resolution for reasons other than the interests of 
compliance with the Clean Air Act. Also, EPA has determined not to 
require willful and knowing negligence for vicarious refiner liability 
due to the difficulty of establishing knowledge and due to EPA's belief 
that such a requirement would ease the obligation of refiners to 
strictly monitor the quality of their product as it is distributed. 
Finally, EPA has created a system of sampling and testing that creates 
the most thorough oversight scheme necessary while avoiding unnecessary 
redundancies. The regulations require each party to conduct sampling 
and testing at appropriate points in the distribution system. However, 
as discussed above, EPA will exercise its enforcement discretion so as 
to allow parties the flexibility to jointly assume responsibility for 
the accomplishment of required testing. This exercise of enforcement 
discretion is intended to avoid redundancies. EPA cannot justify the 
imposition of unnecessary sampling and testing on the regulated 
community to alter economic advantages associated with this program.

J. Baselines for Imported Gasoline

    EPA received comments on the appropriate baseline to apply for 
gasolines produced at foreign refineries and imported into the United 
States.
1. Introduction
    EPA's regulations prescribe the procedures for establishing 1990 
baselines for refiners and importers. Compliance with the anti-dumping 
standards is measured by comparison to these baselines. In addition, 
during the period 1995 through 1997, the reformulated gasoline 
emissions standards are based in part on maximum parameter levels 
measured against these baselines. Section 211(k)(8) provides for 
refiners, blenders or importers to determine individual 1990 baselines 
predicated on adequate and reliable data. In the absence of such 
adequate and reliable data, Congress prescribed a summertime baseline 
and mandated that the Administrator would establish a wintertime 
baseline.''66
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    \6\6The statutory baseline is intended to approximate the 
national average gasoline parameter values for gasoline used in the 
United States in 1990.
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    The final rule provides mechanisms for establishing accurate and 
verifiable refinery baselines, while avoiding options that might 
provide incentives for the regulated community to ``game'' the 
baseline-setting process. These two principles that underlie the 
baseline-setting mechanisms (accurate, verifiable, and no opportunity 
for ``gaming'') serve the environmental purpose of ensuring that the 
quality of gasoline used in the United States beginning in 1995 is 
properly compared with the quality of the gasoline used in the United 
States in 1990.
    Subsequent to January 1, 1995, all conventional gasoline marketed 
in the U.S. will be subject to emission standards established with 
reference to an individual baseline. Between January 1, 1995 and 
January 1, 1998, all reformulated gasoline marketed in the U.S. also 
will be subject to standards established with reference to an 
individual baseline. The consequence of a baseline-setting mechanism 
that would result in baselines that, overall, are less stringent than 
1990 average gasoline quality, would be that the environmental benefits 
intended for reformulated and conventional gasoline beginning in 1995 
would not be achieved.
    If refiners had the option of presenting the data necessary to 
establish an individual refinery baseline, or being assigned the anti-
dumping statutory baseline, each refiner's choice would be clear. Each 
refiner would calculate whether the individual baseline or the 
statutory baseline is more stringent for that refiner, and would simply 
select the least stringent option. In consequence, if parties were 
given more than one regulatory option to establish a baseline, the 
cumulative effect of each individual refiner's exercise of the 
baseline-setting option would be that the environmental benefits 
intended for reformulated and conventional gasoline would not be 
achieved. Accordingly, EPA has avoided providing options within the 
baseline-setting scheme.
2. Required Individual Baselines--Domestic Refiners
    EPA's final rule provides for a scheme to establish refinery 
baselines for domestic refiners that avoids giving parties options, and 
within this no-option constraint, that uses the best available data in 
setting baselines. As a general approach, parties are required to 
establish individual baselines using actual 1990 data (Method 1). 
However, EPA does not anticipate that many domestic refiners will have 
all the data necessary to establish an individual baseline based 
entirely on actual 1990 data. Therefore, where the actual 1990 data is 
not available, the baseline provisions provide for the modelling of 
1990 parameters (Methods 2 and 3). These models are based on the 
absence of ``first choice'' 1990 data, and require that the affected 
party provide the ``next best'' data available from production 
subsequent to 1990 to establish a modelled accurate baseline.
    Domestic refiners are not permitted an option to revert to the use 
of Methods 2 and 3. Rather, refiners are required to use Method 1 if 
actual 1990 data is available. If the Method 1 data are not available, 
refiners are required to use Method 2, and if Method 2 data are not 
available, refiners are required to use Method 3. Domestic refiners are 
not permitted an option to use the statutory baseline. Domestic 
refiners are required to use independent commercial auditors to certify 
the accuracy and the availability (or non-availability) of data for any 
of the baseline setting methods, and to assure the proper application 
of those methods. This scheme does not give domestic refiners any 
choice in the manner in which baselines are set, thus avoiding the 
potential for ``gaming'' by individual refiners. Moreover, EPA is 
easily able to conduct enforcement audits of the baseline submissions 
of domestic refiners. In consequence, EPA believes that this scheme 
will result in the establishment of an accurate representation of the 
actual U.S. 1990 baseline gasoline fuel properties from domestic 
refiners. This baseline setting scheme is discussed in detail in 
Section VIII of this preamble.
3. Baselines--Importers of Foreign Gasoline
    The final rule provides that importers of gasoline must establish 
an individual baseline using actual 1990 gasoline characteristics 
(Method 1). Where actual 1990 data are not available, however, an 
approach that is different than the approach used for domestic refiners 
is necessary. In the absence of actual 1990 data, an importer is 
required to use the anti-dumping statutory baseline.
    Importers are not permitted to use Methods 2 or 3 because often it 
is simply not technically feasible to model an importer's 1990 baseline 
from gasoline imported during the years subsequent to 1990, for the 
following reasons. The foreign sources and production processes 
underlying an importer's post-1990 gasoline will have changed for most 
importers from those sources and processes underlying the importer's 
1990 product. The model Methods are not designed to factor in such 
changes. In addition, it is exceedingly difficult to establish the 
refinery-of-origin of discrete products, due in part to the fact that 
foreign gasoline from different foreign refineries often is subject to 
fungible mixing prior to arrival at the U.S.67 Accordingly, both 
the importers and EPA would be unable to verify the accuracy or 
reliability of an importer's modelled baseline.
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    \6\7In discussions with representatives of the U.S. Customs 
Service, EPA has been informed that the Customs Service has found it 
is virtually impossible to trace a batch of gasoline from point of 
entry in the U.S. back to the country of origin. Country of origin 
for gasoline is relevant for Customs purposes because import tariffs 
on gasoline differ depending on whether the country of origin has 
most-favored-nation trade status. To the extent the Customs Service 
is unable to verify even the country of origin of gasoline, the 
refinery of origin would be even more difficult to verify.
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    As a result of the technical infeasibility of the application of 
Methods 2 and 3 to importers (change of gasoline source-refiners 
between 1990 and later years, and inability to track refinery-of-origin 
generally), and lack of adequate enforcement, all importers that are 
unable to produce actual 1990 production values are required to revert 
to the anti-dumping statutory baseline. In addition, EPA anticipates 
that most importers lack the actual 1990 testing data necessary for 
establishing a baseline using Method 1. As a result, EPA expects most 
importers will be assigned the anti-dumping statutory baseline.
    EPA considered giving foreign refiners, as opposed to importers, 
the option of either setting individual baselines using Methods 1, 2, 
and 3, or of being assigned the anti-dumping statutory baseline. This 
approach is flawed, however, because of the gaming opportunity it would 
give foreign refiners. As discussed above, such a gaming opportunity 
would result in an overall quality of gasoline in 1995 and thereafter 
that would fail to achieve the environmental goals intended for 
reformulated and conventional gasoline.
    A foreign refiner with an actual baseline dirtier than the 
statutory baseline would prefer to continue to produce to that 
baseline. However, a foreign refiner with an actual baseline cleaner 
than the statutory baseline would prefer to produce to the less 
stringent statutory baseline. Accordingly, the incentives to game the 
program would result in the average quality of gasoline imported to the 
U.S. being skewed to produce dirtier gasoline than the statutory 
baseline. Foreign refiners would collectively exceed the U.S. average 
gasoline parameters, resulting in dirtier U.S. air.
    EPA also considered whether it would be feasible to apply the same 
baseline-setting approach used for domestic refiners to foreign 
refiners directly, i.e., that any foreign refiner would be required to 
establish an individual baseline using Methods 1, 2, or 3. Under this 
approach, any foreign refiner, like any domestic refiner, who is unable 
to establish the quality of its 1990 US-market gasoline would be barred 
from supplying gasoline for use within the United States beginning in 
1995. This approach would be consistent with the guiding themes for 
baseline-setting: That parties not have options in setting baseline 
levels, and that within this constraint that the baselines are set 
using the best available data. Application of this baseline-setting 
approach to foreign refiners is problematic, however.
    Foreign refiner use of the general scheme using Methods 1, 2 and 3 
would require that the foreign refiner must have actual test data for 
the portion of its production destined for U.S. markets, or in the 
alternative, foreign refiners would have to model the 1990 quality of 
their U.S. product based on post-1990 gasoline quality data and 
refinery configuration information. EPA believes that most foreign 
refiners lack the information necessary to establish their 1990 U.S. 
market gasoline under either Method 1, 2 or 3. Most (if not all) 
foreign refiners, like domestic refiners, did not collect adequate data 
in 1990 to use Method 1. In addition, Methods 2 and 3 generally are 
inappropriate for use by foreign refiners for technical reasons, in 
that Methods 2 and 3 model the quality of overall refinery gasoline 
production, not the quality of a portion of refinery production. The 
overall quality of gasoline from a refinery may bear scant resemblance 
to the quality of the portion going to the U.S. market. Accordingly, 
Methods 2 and 3 normally will not work for refineries that ship only a 
portion of their production to the U.S. market.
    EPA believes that it is inappropriate to require the use of Methods 
2 and 3 baselines when these Methods will not work properly for some or 
most foreign refiners, and when the consequence of such a failure would 
be to bar the foreign refiner from importing gasoline into the U.S. 
Therefore, in order to create a non-optional baseline setting approach 
for foreign refiners, EPA determined to regulate their gasolines 
through domestic importers as described above.
    In addition to the technical difficulties inherent in applying 
baseline-setting Methods 2 and 3 to importers and foreign refiners, and 
the potential for gaming that would result from optional use of these 
Methods, EPA is concerned that it would be unable to carry out a 
consistently effective compliance monitoring and enforcement program of 
foreign refinery baselines set using these Methods, with the result 
that the accuracy of foreign refinery baselines would not be ensured.
    There is a fundamental distinction between EPA's ability to monitor 
and enforce regulatory requirements that would apply against domestic 
as opposed to foreign refiners. Simply put, domestic refiners are 
subject to the full panoply of EPA's regulatory jurisdiction and 
compliance monitoring, while not all foreign refiners desiring to 
produce reformulated and/or conventional gasoline may be subject to 
EPA's regulatory jurisdiction with equivalent certainty. Compliance 
monitoring and enforcement are integral to the establishment of 
accurate and verifiable baselines, as well as subsequent compliance 
with standards based on these baselines.
    The reformulated gasoline program compliance monitoring and 
enforcement scheme consists of several elements designed in the 
aggregate to ensure that the environmental goals of the Clean Air Act 
are met, including, inter alia: baseline-setting audits; mandatory 
reporting and record keeping; independent laboratory sampling and 
testing; tracking of product from point of production to point of 
distribution; unannounced EPA compliance inspections; annual attest 
engagements by certified professionals; and an enforcement scheme 
comprised of civil penalties, injunctive relief, and criminal 
sanctions. Domestic refiners and importers are subject to EPA 
jurisdiction in each of these activities; all foreign refiners may not 
be equally amenable to EPA jurisdiction.
    Domestic refiners, required to establish individual baselines using 
actual or inferred 1990 production values (Methods 1, 2 and/or 3), are 
required to have baseline parameter determination methodology and 
resulting values verified by an EPA-certified auditor. However, foreign 
refiners, like all foreign corporations and citizens, enjoy protected 
status under the laws of their national jurisdiction and are not 
equally amenable to EPA audits of refiner baselines.68 EPA has 
experienced difficulty in other mobile source regulatory programs, 
including the foreign automotive certificate of conformity program, in 
gaining entry to foreign countries to conduct compliance inspections 
and therefore believes similar problems could arise under the 
reformulated gasoline program.
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    \6\8A commenter suggested that diplomatic instruments may be 
available to mitigate EPA's concerns with access to foreign 
refineries for baseline certification and compliance monitoring and 
oversight. However, EPA has not been presented with a model 
instrument that guarantees such access over time. In contrast, EPA 
does have guaranteed access to domestic refineries and importers 
through authority provided in the Act and its implementing 
regulations.
    Further, EPA is unaware of any current diplomatic instruments 
which would provide EPA with assurances of oversight of the 
integrity of compliance audits conducted by non-U.S. auditors.
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    EPA has considered whether one or more foreign refiners may be able 
to devise a diplomatic instrument sufficient to guarantee EPA's 
certified auditors and inspectors access to conduct baseline 
verification audits and compliance oversight and enforcement 
inspections. However, the foreign supply of gasoline (conventional and 
ultimately reformulated gasolines) to the U.S. currently depends on 
imports from numerous foreign sources. EPA believes it unlikely that 
all current (or foreseeable future) foreign suppliers of gasoline will 
be able to provide adequate diplomatic guarantees for EPA access.
    The environmental benefits of the reformulated gasoline program 
depend on EPA's receipt of accurate and verifiable reports from 
regulated parties, and EPA's ability to review the data possessed by 
the regulated community that underlies the reports, or in the 
alternative, EPA's ability to seek civil, criminal and professional 
sanctions against domestic corporate officers and professionals engaged 
in maintaining records or submitting reports and audits to the U.S. 
government. However, in the case of foreign refineries, EPA does not 
have the authority for oversight of the record keeping and reporting 
process that is equivalent to EPA's authority over domestic refiners 
and possible sanctions are not equally available to ensure accurate 
reports by foreign parties. Again, EPA believes it unlikely that all 
foreign governments desiring to import reformulated or conventional 
gasoline to the U.S. would either consent or be able to provide 
adequate assurance of foreign reporters' amenability to EPA legal 
process.
    The integrity of the reformulated gasoline program is also affected 
by EPA's ability to verify the baseline that applies to each batch of 
gasoline produced domestically or imported. The baseline of a gasoline 
batch establishes the standard against which compliance for that batch 
will be measured.
    In the case of gasoline produced domestically, baselines are set at 
the refinery; any gasoline produced at a refinery and intended for the 
domestic market is subject to that refinery's baseline. As a result, 
tracking of gasoline to its refinery-of-origin is not necessary in the 
case of domestically-produced gasoline.
    If foreign refinery-specific baselines were applied to imported 
gasolines, however, it would be necessary to identify the refinery-of-
origin for all imported gasoline. This type of identification often 
would be very difficult or impossible. At the time gasoline arrives by 
ship at a U.S. port of entry, the gasoline has no inherent quality that 
would identify either the refinery at which the gasoline was produced 
or the baseline that properly applies to the gasoline. The only 
mechanism available for correlating any imported gasoline with the 
refinery-of-origin is the paperwork that accompanies the gasoline. 
EPA's ability to verify the accuracy of such paperwork is extremely 
limited. Gasoline produced by a foreign refinery may trade hands or be 
intermixed with other product several times before entering the United 
States. EPA lacks the ability to accurately and readily determine the 
refinery-of-origin based solely on the documentation of fuel 
transactions and shipments through myriad distribution parties and 
routes outside the United States.
    If foreign refinery baselines were allowed, EPA would have no 
recourse other than to rely on the import paperwork that is supplied by 
the importer for purposes of identifying the baseline applicable for 
imported gasoline. EPA would have little or no means of detecting, 
documenting, or proving any cheating in the form of misstating the 
refinery-of-origin and thereby the applicable baseline for imported 
gasoline. EPA would therefore lack the ability to monitor the 
compliance of foreign refineries with individual baselines. 
Accordingly, EPA has determined to abide by its proposal to focus 
regulation of foreign gasoline on domestic importers of product over 
which EPA does enjoy enforcement jurisdiction.
    Domestic refiners and importers are subject to unannounced 
compliance inspections by EPA. Foreign refiners, by virtue of their 
sovereign protected status, are not equally subject to unannounced 
inspections. Again, the environmental and public health benefits 
arising from an austere compliance monitoring program are not as 
readily available with respect to foreign refiners.
    Domestic refiners and importers are subject to a panoply of 
enforcement mechanisms to ensure compliance with the Clean Air Act. EPA 
may seek civil or criminal penalties or injunctive relief within the 
U.S. judicial system and be assured that judgments will be enforced. 
Judicial remedies are essential to EPA's enforcement of a regulatory 
program in which significant economic incentives exist to produce non-
complying product.
    However, U.S. judicial jurisdiction may not fully and easily extend 
to foreign refiners. EPA's ability to exercise enforcement measures 
against foreign refiners is uncertain, at best. For example, in an EPA 
motor vehicle recall administrative action against a foreign automobile 
manufacturer, the manufacturer argued EPA lacked jurisdiction and 
refused to accept service or comply with administrative discovery 
requirements in a manner that would not be possible by a domestic 
automobile manufacturer. Accordingly, EPA has determined to focus its 
regulatory authority on domestic importers of foreign gasoline which 
are amenable to U.S. legal process.
    In summary, EPA has considered all proposed baseline-setting 
alternatives for foreign gasolines to the final rule and has determined 
that the rule issued today is necessary to protect the quality of U.S. 
air and public health. Further, the baseline setting scheme promulgated 
today is the least restrictive scheme available to ensure that the 
goals of the Clean Air Act are achieved.
    EPA is aware that the baseline approach adopted today for foreign 
refiners is the result of EPA's concerns over a variety of technical 
and enforcement issues related to the importation of gasoline.
4. Comments
    One foreign refiner commenter to the 1992 SNPRM objected to this 
baseline-setting scheme on the grounds that some domestic refiners may 
receive baselines dirtier than the statutory baseline due to their 
ability to use actual or inferred 1990 production values, while most 
importers, and therefore foreign refiners, would be subject to the 
statutory baseline and would not enjoy an opportunity to use an 
individual baseline dirtier than the statutory baseline.69 This 
would occur because it is unlikely that domestic importers that do not 
own foreign refineries maintained records of 1990 imported gasoline 
characteristics adequate to establish an individual baseline. The 
commenter recommended that foreign refiners be permitted to establish 
individual baselines using Methods 1, 2 and/or 3 to establish their 
baselines.
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    \6\9 This issue is primarily of concern to foreign refiners 
whose actual 1990 production characteristics exceed the statutory 
baseline.
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    EPA gave serious consideration to this comment, and in the 1993 
SNPRM described the concerns raised by the comment and the alternatives 
suggested by the commenter, and invited comment on the issue.
    In response to the 1993 SNPRM several commenters objected to 
providing foreign refineries with individual baselines on the grounds 
that such baselines would promote gaming of the system, thereby 
reducing the air quality benefits sought under the Act, and would 
provide foreign refiners with a competitive advantage. Because foreign 
refiners do not have to comply with the reformulated gasoline program's 
anti-dumping provisions for conventional gasoline sold outside of the 
U.S., the commenters alleged that foreign refiners can produce 
reformulated gasoline at lower overall cost.
    Other comments were received that supported the granting of foreign 
refinery baselines, on the grounds that such baselines would enhance 
competition among gasoline suppliers within domestic US markets, to the 
advantage of the public generally.
    EPA believes the comments related to any competitive consequences 
of baselines are irrelevant. As a result, EPA has rejected all comments 
relating to competitive concerns, and EPA's decisions regarding the 
manner in which baselines are set are not influenced by such 
considerations.
    After consideration of all relevant comments on this issue, EPA has 
determined to implement the baseline provisions described above. The 
detriment to the U.S. environment associated with the potential 
establishment of inaccurate refinery baselines by current and possibly 
future foreign sources of imported gasoline, along with the 
difficulties associated with monitoring compliance with the anti-
dumping and reformulated gasoline programs, compel the Agency to 
require that domestic importers establish individual baselines using 
Method 1 or that they comply with the anti-dumping statutory baseline, 
and to not establish individual baselines for foreign refiners. This 
scheme is consistent with the scheme of requiring refiners, domestic or 
foreign, to measure compliance against an accurate and verifiable 
baseline that is based on adequate and reliable data. The approach is 
also consistent with EPA's intent to avoid the creation of options 
within the baseline setting scheme that would allow gaming by the 
regulated community. Further, the scheme is consistent with EPA's 
compliance monitoring and enforcement capacity.
5. U.S. Energy Security
    One commenter suggested that requiring foreign refiners to produce 
to the statutory baseline would result in a shortfall of imported 
gasolines to the U.S. EPA's analysis indicates that gasoline supplies 
will be unaffected by implementation of the proposed baseline 
requirements. This conclusion is based on the likelihood that the 
baseline proposal would at most result in a small change in gasoline 
imports in limited markets, combined with the excess domestic refining 
capacity, and the expansion of gasoline volume that will result from 
the oxygenate use mandated for domestic gasoline.
    EPA concludes that the baseline provisions adopted today pose no 
significant problem for U.S. energy security.
6. Date the Complex Model Becomes Mandatory
    One commenter notes that the individual baseline issue is only 
pertinent to the years during which gasoline may be produced under the 
simple model for determining gasoline characteristics. Beginning in 
1998, when the complex model becomes mandatory, the commenter correctly 
points out, all reformulated gasoline will be required to achieve 
specified reductions from the statutory baseline. Accordingly, the 
commenter observes, individual baselines for foreign refineries are 
only critical during the years the simple model is relevant.
    However, the refinery/importer individual baseline will continue to 
be relevant beyond application of the simple model due to its 
application to conventional gasoline through the anti-dumping 
requirements. As a result, if individual foreign refinery baselines 
were allowed, the difficulties described above would persist in 
perpetuity. Accordingly, the feasibility of the baseline setting scheme 
established today will have longstanding effect on the viability of the 
reformulated gasoline and anti-dumping program.

K. Date Reformulated Gasoline Requirements Begin

    Section 211(k)(5) prohibits the sale or dispensing of conventional 
gasoline in any covered area beginning on January 1, 1995. In order to 
implement this timing mandate, EPA proposed that the reformulated 
gasoline requirements would apply at all locations beginning on January 
1, 1995. EPA now believes that it is necessary for the reformulated 
gasoline requirements to apply at facilities upstream of the retail 
outlet level beginning on December 1, 1994, in order for facilities at 
the retail level to have reformulated gasoline beginning on January 1, 
1995.
    Under the gasoline volatility program (40 CFR 80.27-80.28), the 
volatility standards apply at facilities upstream of the retail outlet 
level beginning on May 1 of each year, and at all facilities including 
retail outlets and wholesale purchaser-consumers beginning on June 1 of 
each year.70 This regulatory approach provides a one month lead-
time during which the gasoline being dispensed at terminals meets the 
summertime volatility standard, in order to ``turn over'' the gasoline 
in retail level storage tanks to meet the summertime volatility 
standard before June 1. As a result of this timing requirement for 
gasoline volatility, almost all retail outlets achieve the summertime 
volatility standard by June 1 through the normal cycle of gasoline 
deliveries.
---------------------------------------------------------------------------

    \7\0 The end of the volatility control season each year is 
September 15 at all facilities.
---------------------------------------------------------------------------

    In contrast to this favorable experience under the gasoline 
volatility program, during implementation of the diesel sulfur program 
(40 CFR 80.29-80.30) retailers and wholesale purchaser-consumers had 
significant difficulties complying with the new requirements at the 
beginning of that program on October 1, 1993. The diesel sulfur 
regulations did not require facilities upstream of the retail level to 
have low sulfur diesel fuel in place well before October 1, 1993, and 
many terminals did not meet the low sulfur standard until very shortly 
before October 1. As a result, a large number of retail outlets and 
wholesale purchaser-consumers were not able to obtain low sulfur diesel 
fuel in advance of the October 1, 1993 date when all facilities were 
required to meet the low sulfur diesel standard. In consequence of this 
situation in some areas of the country prices of low sulfur diesel fuel 
rose 30 cents to 40 cents over the cost of high sulfur diesel fuel. As 
a result, EPA was compelled to grant retailers and wholesale purchaser 
consumers additional time after October 1 to come into compliance with 
the diesel sulfur standard.
    EPA believes that unless a lead-time is mandated under the 
reformulated gasoline program, the January 1, 1995 commencement will 
result in the same supply difficulties that occurred under diesel 
sulfur, and retailers and wholesale purchaser consumers will be unable 
to meet the reformulated gasoline standards on January 1, 1995. EPA 
further believes that a one month lead-time is appropriate for the 
reformulated gasoline program, because a lead-time of this length has 
been successful under the gasoline volatility program. As a result, the 
final regulations include the requirement that certain reformulated 
gasoline requirements must be met by facilities upstream of the retail 
level beginning on December 1, 1994.
    This regulatory provision constitutes a clarification of the 
proposal that would require all parties, including retailers and 
wholesale purchaser-consumers, to meet the reformulated gasoline 
standards beginning on January 1, 1995. The proposed regulatory timing 
could only be achieved if upstream facilities began dispensing 
reformulated gasoline before January 1, 1995, and that in consequence a 
lead-time of approximately one month was implicit in the proposal.
    All regulatory requirements for reformulated gasoline apply to 
gasoline that is produced or imported after December 31, 1994, or any 
time during 1994 if it is intended for use after January 1, 1995. It is 
presumed that all gasoline produced or imported after December 1, 1994 
is intended for use after January 1, 1995. These requirements include, 
inter alia, independent sampling and testing, provisions dealing with 
downstream oxygenate blending, record keeping, reporting, and attest 
engagements. This reach of the reformulated gasoline requirements is 
consistent with the regulatory provision contained in the proposal 
(also included in the final rule at Sec. 80.65(a)), that reformulated 
gasoline requirements would apply to all gasoline sold, dispensed, 
stored, transported, produced, or imported on or after January 1, 1995. 
EPA thus proposed that gasoline sold or dispensed on January 1, 1995, 
and that necessarily will have been produced or imported during 1994, 
would be subject to all reformulated gasoline requirements.
    Thus, for example, all gasoline produced or imported on or after 
December 1, 1994 will have to be designated as reformulated or 
conventional. If it is designated as reformulated it will have to 
comply with reformulated gasoline standards. If it does not comply with 
reformulated gasoline standards, it will have to be designated as 
conventional, segregated from reformulated gasoline, and clearly 
labeled as conventional gasoline and not intended for use in any 
covered area.
    In the case of reporting requirements, EPA intends that no 
quarterly or averaging reports will be submitted in 1994, and that the 
first quarterly report in 1995, that must be submitted by May 31, 1995, 
will be the first reformulated gasoline report. As a result, all batch-
specific information for gasoline produced during 1994 should be 
included in the first quarter 1995 report. A provision is included in 
the final rule to this effect, at Sec. 80.75(a)(3). Similarly, EPA does 
not intend that a separate attest engagement must be performed at the 
conclusion of 1994, but that the 1995 attest engagement must include 
all gasoline produced or imported in 1994.
    EPA also has included a provision in the final rule, at 
Sec. 80.67(i), to specify the manner in which standards are met for 
reformulated gasoline produced to average (as opposed to per-gallon) 
standards during 1994. Proposed provisions dealing with averaging did 
not address this category of reformulated gasoline, because the 
averaging proposals only addressed gasoline produced beginning in 
January 1995.
    The provision in the final rule specifies that reformulated 
gasoline that is produced or imported during 1994 but that is intended 
to be used in 1995 may meet the reformulated gasoline standards on 
average, provided that the refiner or importer satisfies the gasoline 
quality survey prerequisite during 1995. The provision further 
specifies that any such average compliance reformulated gasoline must 
be grouped with gasoline produced or imported during 1995 for purposes 
of compliance calculations, as well as reporting. As a result of the 
requirement that for each parameter only the per-gallon or only the 
average standard may be used during each averaging period, the 
compliance approach used for each parameter in 1994 (per-gallon vs. 
average) must also be used for all of 1995.
    EPA believes this approach for average compliance gasoline produced 
in 1994 is appropriate, because it represents the alternative that 
preserves the opportunity for refiners and importers to meet standards 
on average for this category of gasoline, with the smallest regulatory 
burden for regulated parties and for EPA. EPA considered, and rejected, 
the alternative of allowing parties to use only the per-gallon 
standards during 1994, because of the adverse impact on flexibility of 
such a restriction.
    EPA also rejected the option of requiring that average standards 
must be met separately for gasoline produced or imported during 
1994.71 EPA believes there would be no significant environmental 
consequence of combining 1994-gasoline with 1995-gasoline for averaging 
purposes, but that the regulatory burden of separate accounting for 
1994-gasoline would be significant. The simple model standards that 
will apply for gasoline produced or imported during 1994 are limited to 
oxygen, benzene, and toxics emissions performance, because this 
gasoline will not be VOC-controlled. These parameters are regulated 
because of toxic pollution concerns, and have the relatively long 
averaging period of twelve months because the threat of toxic pollution 
is long-term, cumulative in nature. EPA believes that combining the 
limited volume of 1994-gasoline with 1995-gasoline is consistent with 
the long-term averaging approach to toxics generally.
---------------------------------------------------------------------------

    \7\1 A refiner or importer who produces or imports reformulated 
gasoline using the average standards, but who uses only the per-
gallon standards during 1995, would be required to meet the average 
standards using the 1994-gasoline only.
---------------------------------------------------------------------------

VIII. Anti-Dumping Requirements for Conventional Gasoline

A. Introduction

    Section 211(k)(8) of the Act requires that average per gallon 
emissions of specified pollutants from non-reformulated (i.e., 
conventional) gasoline use must not deteriorate relative to emissions 
from 1990 gasoline, on a refiner72 basis. Compliance is measured 
by comparing emissions of a refiner's conventional gasoline against 
those of a baseline gasoline. An individual baseline, consisting of 
fuel parameters and emissions, is developed for each refiner based on 
the quality of its 1990 gasoline, although under certain circumstances 
the individual baseline is the statutory baseline fuel parameters and 
emissions. To implement this requirement, EPA is promulgating 
requirements known as the anti-dumping provisions for conventional 
gasoline producers and importers. These requirements apply to all 
conventional gasoline producers and importers whether or not they also 
produce or import reformulated gasoline.
---------------------------------------------------------------------------

    \7\2For ease in discussion, the term ``refiner'', as used in 
this discussion of the anti-dumping program, will hereafter include 
refiners, blenders and importers. Where appropriate, blenders and 
importers will be mentioned specifically.
---------------------------------------------------------------------------

    This section describes the key features of the anti-dumping 
provisions (excluding the compliance and enforcement provisions 
applicable to conventional gasoline which are discussed in Section IX). 
The requirements discussed in this section are detailed primarily in 
Sec. 80.90 to Sec. 80.93 in the accompanying regulations. This section 
also highlights major comments received on EPA's proposals in this area 
and how this final rule differs from those proposals. Additional 
supporting information can be found in Section VII of the associated 
Regulatory Impact Analysis (RIA).

B. Emission Requirements

1. Introduction
    Section 211(k)(8) of the Act requires that EPA promulgate 
regulations ensuring that, for each refiner, average per gallon 
emissions of VOC, CO, NOX and toxic air pollutants from its 
conventional gasoline do not increase over emissions from the gasoline 
introduced into commerce by that refiner in calendar year 1990. 
Emissions are to be measured on a mass basis, and each of the four 
pollutants is to be considered separately. Increases in NOX 
emissions due to oxygenate use may be offset by equivalent or greater 
mass reductions in the other pollutants.
    The regulations promulgated today address exhaust benzene, total 
exhaust toxics and NOX emissions from conventional gasoline use. 
In addition, under the simple model, refiner specific caps are set for 
sulfur, olefins and T90. EPA is not promulgating specific requirements 
for emissions of VOCs or CO, as EPA believes that the regulations 
promulgated herein, in conjunction with various other agency 
regulations and Clean Air Act requirements, will adequately meet the 
emissions limits for all four pollutants specified in section 
211(k)(8). A detailed discussion of EPA's reasons for adopting this 
approach may be found in the Agency's July 9, 1991 proposal and, in 
summary, in the RIA.
    Section 211(k)(8) authorizes this approach as that provision 
requires that EPA promulgate regulations ``ensuring'' that conventional 
gasoline meet certain requirements on a refiner specific basis, but 
does not mandate that EPA promulgate regulations for each of the four 
pollutant categories. This provision therefore provides EPA with the 
discretion to fashion a regulatory program that ``ensures'' these 
results. While a relatively straightforward approach to this would 
involve emissions requirements for each of the four pollutant 
categories, it need not if the regulatory program otherwise achieves 
the required result.
    While the language used by Congress in section 211(k)(8)(A) 
supports this interpretation, there are several other provisions in 
section 211(k) where Congress clearly specified that EPA promulgate 
various requirements, and such language is conspicuously missing from 
section 211(k)(8)(A). See, for example, section 211(k)(8)(D) (``The 
Administrator shall promulgate an appropriate compliance period * * 
*''), section 211(k)(1) (``regulations shall require the greatest 
reduction in emissions * * * taking into consideration * * *''), 
section 211(k)(2) (``regulations * * * shall require that reformulated 
gasoline comply with paragraph (3) and * * * each of the following 
requirements * * *''), section 211(k)(4)(A) (``The regulations * * * 
shall include [certification procedures] * * *''), section 211(k)(7) 
(``The regulations * * * shall provide for the granting of an 
appropriate amount of credits * * *''). While EPA received several 
comments on the proposed conventional gasoline requirements, no one 
disagreed with the above interpretation of EPA's authority under 
section 211(k)(8)(A).
2. Emission Requirements Prior to January 1, 1998
    Prior to mandatory use of the complex model on January 1, 1998, the 
requirements of section 211(k)(8) of the Act will be met by requiring 
that the annual average exhaust benzene emissions of a refiner's 
conventional gasoline not exceed its baseline exhaust benzene 
emissions. The exhaust benzene emissions due to conventional gasoline 
can be determined using the simple model discussed in Section III. Only 
the effects of fuel benzene and fuel aromatic content on exhaust 
benzene are included in this model.
    When the simple model is used for compliance, the annual average 
sulfur, olefin and T90 values of a party's conventional gasoline cannot 
exceed its baseline values of those parameters by more than 25 percent. 
These limits will provide some additional assurance that conventional 
gasoline emissions of toxics and NOX will not rise prior to use of 
the complex model. EPA does not expect the levels of these parameters 
in conventional gasoline to naturally increase due to the reformulated 
gasoline program, since the simple model for reformulated gasoline 
simply caps these three fuel parameters at their baseline levels and 
does not require their reduction.
    A refiner may also use the complex model for determining compliance 
prior to its mandatory use. Because all of the fuel parameters 
affecting exhaust benzene emissions are part of the model (benzene, 
aromatics, RVP, sulfur, olefins, E300, E200, and oxygen) there is no 
need for separate ``caps'' on fuel parameters as associated with the 
simple model.
    A refiner's baseline exhaust benzene emissions are determined by 
evaluating the refiner's baseline fuel parameter values in the model 
chosen by the refiner for compliance. At the end of a compliance 
period, the average fuel parameter values of a refiner's conventional 
gasoline over that period are evaluated in the same compliance model 
used to determine the refiner's baseline emissions. The resulting 
emission values are then compared to the baseline emission values to 
determine if the party is in or out of compliance with the anti-dumping 
requirement. While there was general support for the regulatory 
approach taken by EPA, several commenters suggested specific revisions 
to the emissions requirements. EPA's responses are discussed in the 
RIA. However, none of the comments caused EPA to change its proposed 
requirements, and all of the above provisions are being promulgated 
essentially as proposed.
    EPA had proposed that while a refiner may choose to use either the 
simple model or the complex model prior to January 1, 1998, it must use 
the same model for both the reformulated gasoline and the anti-dumping 
programs. Several commenters disagreed with this last restriction. EPA 
is, however, promulgating this requirement as proposed because the 
anti-dumping and reformulated gasoline provisions are inherently tied 
together. The specific model used to certify reformulated gasoline will 
affect which fuel components are likely to be dumped. To avoid 
incentives to dump, the effect of these components on conventional 
gasoline emissions should be evaluated on the same basis as the 
reformulated gasoline emissions. Otherwise, incentives will exist to 
shift dirty components to conventional fuel areas using whichever model 
predicts the lowest emissions increase due to those components.
3. Emission Requirements Beginning January 1, 1998
    Beginning January 1, 1998, the requirements of section 211(k)(8) of 
the Act shall be met by requiring that the exhaust toxic emissions and 
the NOX emissions of a party's conventional gasoline not exceed 
that party's baseline exhaust toxic and NOX emissions. Compliance 
with this requirement shall be determined using the complex model 
described in Section IV.
    The exhaust toxics emissions requirement under mandatory use of the 
complex model includes all five pollutants defined in section 
211(k)(10)(C) as toxics. These are exhaust benzene, formaldehyde, 
acetaldehyde, 1,3-butadiene and POM. Benzene emissions occur in both 
exhaust and nonexhaust emissions, and accordingly, section 
211(k)(10)(C) does not limit the toxic air pollutant benzene to exhaust 
benzene. However, as stated, EPA is only promulgating regulations 
applicable to exhaust benzene. Nonexhaust benzene emissions will be 
effectively controlled by the summertime volatility controls applicable 
to conventional gasoline.73 The sum of the baseline exhaust 
emissions of each of the five toxics is the value that must not be 
exceeded by the sum of the exhaust emissions of these toxic pollutants 
due to a refiner's or importer's annual average conventional gasoline.
---------------------------------------------------------------------------

    \7\3 No credit can be taken nor penalties received under the 
anti-dumping program for nonexhaust benzene reductions, or 
increases. Nonexhaust benzene emissions decrease due to RVP 
reductions, which are a VOC reduction strategy already considered 
under the anti-dumping program as the reason for not explicitly 
controlling VOC emissions.
---------------------------------------------------------------------------

    NOX emissions from conventional gasoline use are also 
controlled beginning January 1, 1998. Although EPA is concerned that 
high oxygenate levels may contribute to increased NOX emissions, 
the Act states that any NOX emissions increase in conventional 
gasoline due to oxygenate use can be offset by VOC, CO and toxic 
emission reductions. EPA is addressing this provision of the Act by 
allowing compliance with the anti-dumping NOX emission requirement 
to be determined on either a nonoxygenated basis or an oxygenated 
basis, as discussed further in paragraph C.5.e of this section.

C. Requirements for Individual Baseline Determination

1. Introduction
    Compliance under section 211(k)(8) of the Act is measured against 
an individual baseline (comprised of individual baseline fuel parameter 
and emission values) which is determined for each refiner if sufficient 
data exist from which to determine a baseline representative of that 
refiner's 1990 gasoline. Additionally, the Act states that if no 
adequate or reliable data exist regarding the gasoline sold by a 
refiner in 1990, the refiner must use the statutory baseline gasoline 
fuel parameters74 as its baseline fuel parameters.
---------------------------------------------------------------------------

    \7\4 The statutory baseline gasoline for anti-dumping purposes 
is discussed further in paragraph C.3.e of this section.
---------------------------------------------------------------------------

2. Requirements for Refiners, Blenders and Importers
    a. Requirements for producers of gasoline and/or gasoline 
blendstocks. No adverse comments were received on the proposal that a 
refinery which primarily produces gasoline blendstocks from crude oil 
(including crude oil derivatives) and mixes those blendstocks to form 
gasoline be subject to baseline determination using any, or a 
combination of, the three data types described below in paragraph 3. 
The requirements are being promulgated essentially as proposed.
    Likewise, no adverse comments were received regarding the proposal 
to exempt (from the anti-dumping requirements) those entities which 
produce and/or supply gasoline blendstocks to refiners and blenders, 
but do not produce gasoline. Hence EPA is not promulgating anti-dumping 
requirements for such entities.
    b. Requirements for purchasers of gasoline and/or gasoline 
blendstocks. As proposed in April 1992, refiners who exclusively 
purchase blendstocks and/or gasoline and mix these purchased components 
to form another gasoline (i.e., blenders) must use Method 1-type data 
(as described in paragraph 3 below). Lacking sufficient Method 1-type 
data, the blender shall have the anti-dumping statutory baseline as its 
individual baseline. Most who commented on this issue suggested that 
blenders should be allowed the same opportunities as refiners to use 
1990 and post-1990 gasoline and blendstock data. Otherwise, a blender 
may have to ``reformulate'' its conventional gasoline. Commenters also 
stated that this provision penalized blenders for not sampling their 
1990 fuel when there were no such requirements. As discussed in the 
proposal, EPA does not believe that use of blendstock data or post-1990 
gasoline or blendstock data would allow an accurate portrayal of a 
blender's 1990 production. Additional comments are discussed in the 
RIA; however, none led to a change in the proposed requirements for 
blenders.
    c. Requirements for importers of gasoline. On April 16, 1992, EPA 
proposed that those who imported gasoline into the U.S. in 1990 must 
use Method 1-type data (as described in paragraph 3). Lacking 
sufficient Method 1-type data, the importer would have the anti-dumping 
statutory baseline as its individual baseline. An importer who did not 
import gasoline into the U.S. in 1990, but who does so after 1994, 
would also have the anti-dumping statutory baseline as its individual 
baseline. EPA proposed that if a U.S. importer is also a refiner and 
imported 75 percent or more of the 1990 gasoline production of a 
refinery into the U.S. in 1990, it could determine a baseline for that 
refinery using the three data types described in paragraph 3 below.
    Most commenters agreed with EPA's overall proposal concerning 
importers. Some felt, however, that the ``75 percent'' criteria was 
self-selecting--only those importer/refiners with higher baseline 
emissions relative to the statutory baseline would choose to develop an 
individual baseline. Those importer/refiners with relatively low 
baseline emissions would use the statutory baseline, and thus dumping 
could result, since they would be complying with a baseline which was 
less stringent than one based on their own 1990 gasoline quality. EPA 
agrees that ``dumping'' could occur, but expects it to be minimal since 
few importing refineries are likely to meet the ``75 percent'' 
criteria. Nonetheless, EPA is requiring that all importers which are 
also refiners utilize Method  1-, 2- and 3-type data to determine the 
individual baselines of their refineries which meet the 75 percent 
criteria.
    One commenter claimed that location, not percent of production 
imported, dictates enforceability. However, EPA believes that 
enforcement of a non-domestic refinery is governed less by location and 
more by the willingness of the company and/or country to open its 
refinery for compliance visitations. Another commenter specifically 
stated that Canadian refineries should be treated the same as domestic 
refineries for the purpose of establishing baselines. As stated, EPA 
believes that it will be relatively easy to accurately determine the 
quality of the gasoline produced in 1990 at a refinery outside of the 
U.S., for sale to the U.S., if a significant amount (i.e., 75 percent) 
of the production of the refinery came to the U.S. Independent of where 
the refinery is located, if less than this amount was imported, it will 
be more difficult to combine information on refinery operations and 
blendstock and gasoline data (i.e., Methods 2 and 3-type data) and 
allocate such information so as to establish the quality of the 
refinery's 1990 gasoline which was sent to the U.S.
    Some commenters felt that an importer should be allowed to use all 
available 1990 and later data to establish a baseline and have its 
baseline verified by an auditor. However, as stated in the proposals, 
EPA believes that significant dumping could occur if post-1990 data is 
allowed since that data may not represent the importer's 1990 gasoline. 
EPA is thus promulgating this essentially provision as proposed.
    d. Requirements for exporters of gasoline. EPA's proposals did not 
explicitly discuss whether gasoline exported from the U.S. in 1990 
would be included in individual baseline determinations. However, 
because exported gasoline did not contribute to pollution in the U.S. 
in 1990, a producer of gasoline exported from the U.S. in 1990 shall 
not include the exported gasoline properties or volumes in its baseline 
determination. A refiner which exports all of its future gasoline 
outside of the U.S. is not subject to the anti-dumping requirements.
3. Types of Data
    a. Introduction. As discussed in the July 9, 1991 proposal, EPA is 
concerned that use of the statutory baseline parameters in lieu of 
determining an individual baseline could have severe competitive 
effects. At the same time, EPA realizes that there likely will be 
insufficient directly measured 1990 fuel parameter data available from 
which to determine representative individual baseline parameters. Thus, 
in order to make the best use of available data in developing 
representative individual baselines, EPA is specifying the types of 
data and calculations that may be used in the baseline determination.
    In the proposals, three methods (Methods 1, 2 and 3) were described 
for refiners to use to determine their baseline parameter values. 
Method 1-type data consists of a refiner's measured fuel parameter 
value and volume records of its 1990 gasoline. As discussed in the RIA, 
Method 1-type data can be from 1990 production or 1990 shipments as 
long as no data is double counted and all available production and 
shipment data are used in the baseline determination. Method 2-type 
data consists of a refiner's 1990 gasoline blendstock composition data 
and 1990 gasoline and blendstock production records. Method 3-type data 
consists of a refiner's post-1990 blendstock composition data and 1990 
gasoline and blendstock production records. For both Methods 2 and 3, 
these provisions apply to those blendstocks used in the production of 
gasoline within the refinery. Under certain circumstances, Method 3-
type data may consist of post-1990 gasoline composition data as well.
    No major comments were received negating the appropriateness of 
utilizing these three methods or data types. A few minor comments were 
submitted which are addressed in the RIA. Several commenters did 
request that EPA allow combinations of Methods 1, 2 and 3-type data to 
be used in baseline determination, in order to improve the use of 
available data and thus develop more accurate and representative 1990 
individual baselines. EPA agrees that a more representative baseline 
will result if a combination of higher and lower levels of data is used 
rather than excluding the better data (i.e., Method 1) due to it being 
inadequate by itself. EPA had proposed that the different types of data 
must be used in a hierarchical order, i.e., Method 1-type data has to 
be used first, and if insufficient Method 1-type data was available for 
a given fuel parameter, Method 2-type data would be used, etc. EPA is 
modifying the proposals to allow baseline parameter values to be 
determined using a combination of the methods, or data types, if 
necessary, although the same hierarchy must be maintained. Thus, 
insufficient Method 1-type data may be supplemented with Method 2-type 
data and, if data were still lacking, the available Method 1 and 2-type 
data would be supplemented with Method 3-type data.
    b. Inclusion of gasoline blendstock. Although not specified in the 
proposals, EPA is requiring that gasoline blendstock which becomes 
gasoline (per 40 CFR 80.2(c)) solely upon the addition of a specific 
type and amount of oxygenate, be included in the baseline 
determination. Unless evidence is provided which indicates that such 
blendstock was blended with oxygenate other than ethanol or less than 
10.0 volume percent ethanol, or was not further modified downstream, 
the refiner shall assume that said blendstocks were blended with ten 
(10.0) volume percent ethanol. This requirement provides some assurance 
that baseline emissions are not artificially low due to selective 
inclusion or exclusion of such blendstock. Requiring that the 
blendstock be assumed to have been blended with a specific amount of 
ethanol (unless otherwise shown) will result in a more stringent 
baseline than if the blendstock were assumed blended with a lower 
volume of ethanol, a different oxygenate or not further modified. 
Hence, the burden of proof of actual disposition of such product is on 
the refiner.
    c. Method 3 additional information. In order that the fuel 
parameter values obtained with Method 3-type data adequately represent 
the 1990 values of those parameters, EPA proposed that the refiner must 
provide detailed documentation of its 1990 and post-1990 refinery 
operations, including comparing 1990 and post-1990 operations, 
intermediates and products, and other aspects of refinery operations 
which would cause its post-1990 gasoline to differ from its 1990 
gasoline. For instance, if post-1991 data is used, appropriate 
adjustments must be made for the refinery operational changes that 
occurred due to the 1992 volatility rules and the oxygenated fuels 
program, two situations which could cause post-1990 operations to 
differ from 1990 operations. The required documentation will assist the 
baseline auditor in its verification and EPA in its review of the 
refiner's baseline submission. This provision is being promulgated as 
proposed.
    EPA proposed to allow post-1990 gasoline data to be used to 
estimate 1990 baseline parameters under certain circumstances. In 
addition to requiring the same detailed documentation of 1990 and post-
1990 operations as above, in the February 26, 1993 proposal, EPA 
specified that the volumetric fraction of each blendstock in post-1990 
gasoline must be within ten (10.0) percent of the volumetric fraction 
of the same blendstock in 1990 gasoline. For example, if a refiner's 
1990 gasoline contained 30 volume percent reformate, post-1990 gasoline 
data may be used in the baseline determination as long as it contained 
27.0-33.0 volume percent reformate and provided all other blendstocks 
also conformed to these requirements.
    EPA received many comments stating that the use of post-1990 
gasoline data was more accurate, and less costly, than using post-1990 
blendstock data. EPA agrees, and is allowing the use of gasoline data 
under certain circumstances, as discussed below. Commenters also 
suggested that verification of differences and similarities between 
1990 and post-1990 operations and the resulting gasoline should be left 
to the baseline auditor rather than compared to specific criteria. 
While the auditor will verify the comparison of 1990 and post-1990 
operations, etc., all issues verified by the auditor will also be 
reviewed by EPA. In addition to the technical reasons discussed below, 
specifying such criteria (i.e., the ``10 percent'' criterion) will 
ensure the uniformity of both auditor and EPA evaluations and 
verifications.
    As discussed in the RIA, unless post-1990 blendstock fractions are 
sufficiently similar to 1990 blendstock fractions, adjustments for 
differences will have to be made at the blendstock level, making any 
gasoline data moot. Larger differences than 10 percent in large streams 
such as reformate could affect overall aromatic levels by up to 3 
volume percent, which is clearly significant. For smaller streams, 
however, a 10 percent change could be insignificant. Therefore, EPA is 
expanding its criteria by allowing post-1990 gasoline blendstocks to 
meet the larger of (1) the 10 percent criterion, or (2) be within two 
absolute volume percent of the blendstock volumetric fraction in 1990 
gasoline. As discussed in the RIA, this means of utilizing post-1990 
gasoline should adequately cover typical fluctuations in both large and 
small volume blendstocks without unduly sacrificing accuracy.
    Post-1990 gasoline data for which a single 1990 blendstock does not 
meet either of the blendstock fraction requirements cannot be used in 
the baseline determination. However, EPA also received comment that 
many refiners would not be able to use post-1990 gasoline data, even 
with the expanded criteria, simply due to butane utilization changes 
from 1990. Because butane, and thus RVP, were reduced after 1990 due to 
volatility controls, and because RVP reductions reduce emissions, EPA 
is exempting butane from the blendstock requirements for using post-
1990 gasoline.
    d. E200 and E300. Although not previously included among the fuel 
parameters for which baseline values are required to be determined, EPA 
is now requiring that baseline values be determined for the fuel 
parameters E200 and E300, the percent evaporated at 200  deg.F and 300 
deg.F, respectively. Although these two fuel parameters replace T50 and 
T90, respectively, in the complex model, T90 baseline values are still 
required to be determined for use prior to mandatory complex model use.
    EPA expects E200 and E300 values to be determined directly from 
gasoline or blendstock data, even if distillation information has to be 
regraphed. If such a determination is not possible, E200 and E300 
values may be estimated from otherwise acceptable T50 and T90 data 
using the equations specified in the regulations. Thus, this addition 
will not void any data collected under the proposed criteria.
    e. Anti-dumping statutory baseline. As mentioned earlier, in some 
cases a blender or importer may not be able, or be allowed, to develop 
an individual baseline from its own data. In that case, the refiner or 
importer would have the statutory baseline as its individual baseline. 
Although the compliance period for conventional gasoline is annual (as 
discussed in the proposals and as described in section IX), emissions 
determined using the complex models are determined on a summer and 
winter basis. Thus, there are separate anti-dumping summer and winter 
baseline fuel parameters, which are the statutory summer baseline 
specified in the Act, and the winter baseline determined by EPA as 
required by the Act. Few comments were received concerning the proposed 
annual average statutory baseline (which is a weighted average of the 
statutory summer and winter baselines, as discussed in the proposals). 
None of the comments led to a change in the annual average baseline 
fuel parameter values.
4. Data Collection and Testing Requirements
    a. Sampling requirements. In the February 26, 1993 proposal, EPA 
proposed minimum sampling requirements in order to ensure that enough 
gasoline or blendstock samples were taken from which to develop a 
representative baseline. Namely, for Method 1-type data, at least half 
of the batches (by number of batches, not volume), or shipments if not 
batch blended, in a calendar month shall have been tested for a 
particular parameter. For Methods 2 and 3-type data, at least weekly 
sampling of continuous blendstock streams and, if blendstocks are 
produced on a batch basis, sampling of at least half of the batches of 
each blendstock produced in a month is required.
    Many refining industry commenters protested this proposal claiming 
that they had sampled based on the April 16, 1992 proposal requiring 
``sufficient'' sampling, and that EPA's more specific requirement could 
void data collected, and the time and money spent. EPA agrees that the 
sufficient frequency of sampling may vary according to circumstance 
(such as the degree of variation in operating conditions), and is 
modifying its latest proposal by accepting, under certain 
circumstances, data which does not meet the requirements specified 
above. However, if less than the minimum data is used, the refiner must 
document, and the auditor verify, why the data is less than the minimum 
requirements and why it is sufficient in quantity and quality to use in 
the baseline determination. EPA retains the right to reject use of less 
than the minimum data if the documentation is incomplete or the 
justification not technically sound. In all cases,75 all available 
samples must be analyzed and the results used in baseline determination 
if more than the minimum number of samples are available.
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    \7\5 In instances where a sample was mislabeled or improperly 
tested or where an analysis results in a value which is 
significantly different from expected values based on operating 
conditions, etc., the result may be excluded from the baseline 
calculation. However, all instances of such exclusion must be 
documented and verified by the auditor.
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    Additionally, EPA is promulgating its proposal to require at least 
three months worth of both summer and winter data. As discussed in the 
RIA, this requirement ensures that the collected data covers the 
typical changes in gasoline composition which occurs across seasons. 
Although not explicitly stated in the proposal, to better distinguish 
between summer and winter, summer months shall consist of any month in 
which gasoline was produced to meet the federal summer volatility 
requirements. It is not necessary for such low volatility fuel to be 
produced for the entire month. Winter months are any months which could 
not be considered summer months.
    b. Post-final rule data collection. Few comments were received on 
the February 26, 1993 proposal that if a refiner collects data after 
promulgation of these regulations, the data must be collected no later 
than the end of the third month of the first three full months during 
which summer gasoline is produced by the refiner following promulgation 
of the final rule. EPA is modifying this provision slightly, requiring 
only that proof must be given that additional data was needed and 
indeed was collected after today.
    c. Negligible parameter values. On February 26, 1993, EPA proposed 
to exempt refinery streams from testing for one or more specific 
parameters if a stream contains negligible amounts of those parameters. 
The affected fuel parameters are benzene, aromatics, olefins and 
sulfur. EPA also proposed threshold criteria for each fuel parameter, 
i.e., the amount of the fuel parameter in a stream at or below which 
the parameter would be considered negligible. EPA has changed the 
values of some of the threshold criteria based on comment. 
Specifically, the benzene threshold value was reduced and the sulfur 
threshold value increased. A full discussion of these changes can be 
found in the RIA; the actual values are also listed in Sec. 80.91. 
Oxygen was added to the list of parameters that may be considered 
negligible under certain circumstances. Other than those modifications, 
the requirements are being promulgated as proposed.
    d. Test methods. Many commenters were concerned that the test 
methods they had used to analyze samples would be invalid because they 
were not the same as the required test methods being promulgated today 
for reformulated gasoline. EPA had proposed, on April 16, 1992, that 
sampling and measurement techniques used to determine baseline 
parameters must yield results which are equivalent to the results 
obtained per the techniques and methodologies specified for the 
reformulated gasoline program. However, because of constantly evolving 
test methods, in addition to the fact that the final regulations 
concerning reformulated gasoline test methods will only be known today, 
it would be inappropriate to disallow data because it was not tested 
according to certain methods when there were no requirements to do so. 
Nonetheless, EPA is concerned that the test methods used be adequate. 
In a modification of the proposal, EPA will accept data determined 
using methods other than those required under the reformulated gasoline 
program, upon petition and approval, as long as the methodology or 
technique was a standard industry-accepted measurement technique at the 
time the measurement was taken. If data to be used in the baseline 
determination was, somehow, obtained via a more accurate test method 
prior submission of the baseline to EPA, it may be acceptable. The 
baseline auditor will verify that the techniques used to determine the 
baseline data meet the requirements discussed above. Although not 
previously discussed, EPA is allowing oxygen content, as well as 
oxygenate volume, to be determined from oxygenate blending records. The 
composition of the oxygenate, with regard to the other required fuel 
parameters, must still be determined.
5. Baseline Fuel Parameter Determination
    a. Closely integrated gasoline producing facilities. Based on 
earlier comments, on February 26, 1993 EPA proposed to allow blending 
facilities (or terminal operations) to be included in a refinery's 
baseline determination if a closely integrated relationship could be 
shown between the refinery and the terminal. EPA also requested 
comments as to what criteria would constitute ``closely integrated''. 
Many commenters supported allowing a single baseline for such a 
situation. Requiring 60-75 percent of a blending facility's blendstocks 
to have come from a single refinery was suggested for defining a 
closely integrated refinery-terminal relationship. EPA is promulgating 
the proposal with the requirement that at least 75 percent of the 
blendstock received at the terminal in 1990 must have come from the 
associated refinery. EPA believes this is a reasonable number, as 
explained in the RIA, considering that oxygenates and butane, among 
others, are blended into gasoline after the refinery, while 
constituting much less than 20 percent of gasoline by volume.
    In the case of an aggregate refiner baseline, as discussed in 
paragraph 6.d, a terminal or terminals may be included in the aggregate 
baseline if each terminal received at least 75 percent of its 
blendstock from one or more of the aggregated refineries with which it 
is associated. For instance, the 75 criteria is satisfied if the 
terminal received 25 percent of its 1990 blendstock from refinery A and 
50 percent from refinery B, refinery A and B being part of an aggregate 
baseline. Alternatively, it may also have received the entire 75 
percent from either refinery A or B.
    Although not previously proposed, some comments were received 
regarding other types of closely integrated facility relationships. EPA 
is thus allowing a single individual baseline to be determined for two 
or more refineries (or sets of gasoline blendstock-producing units) 
which are geographically near each other but are not within a single 
refinery gate, and whose 1990 operations were significantly 
interconnected. The burden is placed on the refiner to show that its 
two facilities are ``significantly interconnected''. In this case, the 
two facilities will have a single set of baseline parameter values and 
associated emissions.
    Some commenters suggested that U.S. refiners with import operations 
also be allowed to develop a single baseline covering their refining 
and importing operations. EPA rejected this suggestion because it would 
be difficult for EPA to track a fuel's production location before the 
fuel is or was imported, particularly when considering 1990 production. 
Also, allowing such a situation would amount to trading between foreign 
and domestic refineries, which was not mandated nor intended by 
Congress.
    b. Seasonal weighting. In the February 26, 1993 proposal, EPA 
proposed that a refinery's own production volumes of summer and winter 
gasoline (based on RVP) be used in the weighting of data on a summer 
and winter basis. This change from the previous proposal received a lot 
of support, and is being promulgated as proposed on February 26, 1993. 
As discussed in paragraph 6.a, the 1990 annual baseline volume is the 
larger of the gasoline volume produced in or shipped from the refinery 
in 1990. Thus, a refinery's own baseline volumes of summer and winter 
gasoline (either on a produced or shipped basis) shall be used for 
weighting the summer and winter anti-dumping emissions and sulfur, 
olefins and T90 values. As proposed, all volume which is not summer 
volume is considered winter volume.
    c. Grade weighting. On February 26, 1993, EPA proposed that average 
fuel parameter values be determined first for each grade of gasoline 
produced, and the resulting values weighted by the fraction of each 
grade sold in the period over which the value is determined. Based on 
comments, the proposal has been modified and, for this final rule, 
``grade'' shall mean each traditional grade of gasoline produced in the 
refinery in 1990, e.g., regular, midgrade, and premium, not each 
different integer octane number.
    d. Equations. The equations have been modified slightly from the 
February 1993 proposal to require that specific gravity be included in 
the determination of baseline sulfur and oxygen contents. Because both 
of these fuel parameters are determined on a weight basis, and because 
gasoline and blendstocks vary, sometimes significantly, in weight-to-
volume ratio, correct accounting of such terms must include a weight-
to-volume conversion. Additionally, separate average baseline fuel 
parameter values must be determined for summer and winter, as discussed 
previously.
    e. Oxygen in the baseline. In the April 16, 1992 proposal, EPA 
discussed several methods of accounting for oxygen in the baseline 
determination. Several commenters suggested that the baseline be 
determined on a nonoxygenate basis so as not to penalize those who 
``reformulated'', i.e., produced cleaner gasoline, early. Others 
supported including only the positive difference (i.e., an increase in 
oxygen use) between 1990 and post-1994 oxygenate use. Others suggested 
variations--excluding it in the baseline but including it in 
compliance, and including it as is in both the baseline and compliance 
calculations. Others argued that oxygenate used in conventional 
gasoline designated for areas for CO reduction purposes should not be 
considered.
    The anti-dumping provisions of section 211(k)(8) are based on a 
comparison of 1990 and post-1994 emissions, and use of an oxygenated 
baseline for compliance determination would be the most appropriate 
baseline. EPA is therefore requiring baseline fuel parameter values to 
be determined on an oxygenated basis. Section 211(k)(8)(C) of the Act 
also requires that increases in NOX emissions, due to conventional 
gasoline oxygenate use, be offset by reductions in the other three 
pollutants. As stated earlier, significant VOC and CO reductions will 
occur even without the reformulated gasoline rulemaking. To ensure that 
an increase in NOX emissions is not associated with the use of 
oxygen, EPA is allowing refiners to choose to use either an oxygenated 
or nonoxygenated baseline when determining NOX emissions. 
Compliance would be measured on the same basis. Under this provision, a 
refiner could choose to switch from a nonoxygenated to an oxygenated 
baseline, beginning with the next averaging period. The initial choice 
to use an oxygenated baseline, or the switch from a nonoxygenated to an 
oxygenated baseline is, however, permanent. EPA expects a refiner to 
operate its refinery to its advantage, and thus it is not likely to 
make such decisions (of whether to use a nonoxygenated or an oxygenated 
baseline for NOX purposes) lightly. Additionally, Congress 
intended that the anti-dumping program compare a refiner's 1990 
emissions with its post-1994 emissions, based on its fuels' actual 
average composition, i.e., its actual oxygenated baseline or oxygenated 
compliance value. EPA is allowing refiners to use a nonoxygenated or an 
oxygenated baseline when determining NOX emissions in order to 
fulfill the provision that NOX increases due to oxygenates be 
offset. However, to minimize unnecessary administrative complications 
due to every refiner potentially changing its baseline NOX value 
annually, EPA is allowing only the one-time change.
    In determining the nonoxygenated parameter values from the 
oxygenated values, only the physical dilution and distillation effects 
of the oxygenate shall be considered. Adjustments to refinery 
operations that would have been different had oxygenates not been used 
(i.e., octane) shall not be included because many potential adjustments 
are possible. For instance, if a refiner's actual (oxygenated) baseline 
aromatics were 30 volume percent and actual oxygenate use was 5 volume 
percent, the nonoxygenated baseline aromatics value would be 31.6 
volume percent, or 30/(100%-5%). While it is likely that reformer 
severity may have been higher had oxygenates not been used (thus 
resulting in perhaps even a higher aromatics baseline value) such 
operational effects due to oxygenate use shall not be considered 
because they cannot be known with certainty. Additionally, while the 
oxygen content and the effects of oxygenate volume on parameters will 
be excluded from the nonoxygenated baseline determination, the total 
gasoline volume (including actual 1990 oxygenate use and the volume of 
oxygenate assumed or shown to have been blended with gasoline 
blendstock as discussed in paragraph 3.b) will be used to determine the 
individual 1990 baseline volume.
    A few commenters suggested that oxygenate volume be excluded from 
conventional gasoline volumes. EPA disagrees--Congress specified that 
certain NOX emissions increases be offset, but did not specify how 
to deal with baseline volumes, leaving it to EPA's discretion. 
Additionally, the reason for allowing NOX emissions to be 
evaluated on a nonoxygenate basis in the first place is so as not to 
penalize refiners whose emissions increase due to oxygenate use. It is 
possible that restricting baseline volumes by excluding oxygenate 
volumes could penalize some refiners. Thus, it would be inappropriate 
for EPA to restrict the applicability of the individual baseline to the 
nonoxygenated gasoline volume.
    f. Work-in-progress. EPA proposed criteria for allowing a work-in-
progress (WIP) adjustment on April 16, 1992. In the February 26, 1993 
proposal, EPA expanded the proposed criteria in several areas. A WIP 
adjustment allows the refiner to modify its baseline volumes and fuel 
parameter values (which affect emissions) to account for the WIP. A 
more detailed discussion of the rationale and background concerning WIP 
adjustments may be found in the RIA.
    Several comments reiterated a concern expressed in the regulatory 
negotiation discussions that a WIP adjustment should be a limited 
exception, structured so that few refiners would qualify. EPA agrees 
that the criteria for a WIP adjustment should be fairly stringent, as 
the adjustment was intended only for those for whom a significant 
investment had already been made in order to comply with another 
government mandate. Additionally, a broad program of adjustments could 
indicate that EPA exceeded its equitable discretion under Alabama 
Power, as discussed in the RIA. Nonetheless, most commenters supported 
allowing WIP adjustments for significant differences between unadjusted 
and WIP-adjusted values of exhaust benzene emissions, exhaust toxics 
emissions, NOX emissions, sulfur, olefin or T90, instead of just 
exhaust benzene emissions as proposed in April 1992. A few commenters 
suggested reducing the threshold comparison criteria (between WIP-
unadjusted and adjusted values) of 5 percent for emissions and 25 
percent for sulfur, T90 and olefins. EPA agreed with the substance of 
these comments and is reducing the thresholds between WIP and non-WIP 
values. A discussion of the proposed and final threshold criteria is 
presented in the RIA. EPA's final threshold values under this 
requirement are that WIP-unadjusted and adjusted emissions values must 
differ by 2.5 percent, and sulfur, olefins and T90 values by 10 
percent. Again, only one of the thresholds has to be met in order to 
meet this requirement.
    A few comments were received regarding the requirement that the WIP 
be associated with other regulatory requirements, specifically, the 
type of the regulatory requirement that would be acceptable to EPA. EPA 
is clarifying this, and WIP based on a legislative or regulatory 
environmental requirement enacted or promulgated prior to 1/1/91 will 
be deemed as meeting the ``associated with other regulatory 
requirement'' criterion.
    In the February 26, 1993 proposal, EPA clarified its definition of 
WIP as

    * * * projects under construction in 1990 and projects which 
were contracted for and which will be completed in time for the 
refiner to comply with the regulatory requirement * * *76
---------------------------------------------------------------------------

    \7\6From Sec. 80.91(d)(5) of the February 1993 proposal.

    This language was included to ensure that the WIP was completed in 
a timely manner, since the WIP was ostensibly being done to comply with 
a regulatory requirement. Less than timely completion would indicate 
that the regulatory requirement was not a driving factor in initiating 
the WIP. However, EPA is not promulgating such a completion requirement 
because if the WIP project was not completed in a timely manner, the 
refiner is likely to be losing money since it cannot produce a certain 
fuel or meet certain emission requirements, etc. The contractual 
requirement discussed below will ensure that the refiner was committed 
to the WIP project. Additionally, EPA is specifying that an adjustment 
will only be allowed for WIP projects involving installation or 
modification of one or more gasoline blendstock- or distillate-
producing units in the refinery.
    As stated, EPA also proposed (and is promulgating) that WIP shall 
include projects under construction in 1990 and projects for which 
contracts were signed prior to or in 1990 such that the refiner was 
financially committed to permanently changing refinery operations. 
Clarification was requested as to what types of contracts would be 
considered to have committed the refiner to the WIP. EPA believes that 
the contracts should have committed the refiner to purchasing materials 
and construction of the WIP. As such, a process engineering design 
contract does not commit the refiner to actually implementing the WIP 
and would not be considered a WIP contract under this provision. Other 
suggestions included allowing WIP adjustments for work not necessarily 
associated with a regulatory requirement, including WIP which would 
have a beneficial effect on a refinery's overall environmental 
performance. Again, WIP adjustments were intended to apply only to 
specific situations, i.e., those relatively costly projects undertaken 
for mandated environmental betterment. Thus, it would not be 
appropriate to expand the criteria (as suggested) for qualifying for a 
WIP adjustment.
    On February 26, 1993, EPA proposed allowing either the ``10 
percent'' criteria from the April 16, 1992 proposal or a $10 million 
minimum cost of the WIP to satisfy the capital-at-risk criteria. Some 
commenters suggested that the requirements be more stringent--one 
suggested a threshold value of $50 million. Others suggested reducing 
the threshold value to $5 million (possibly a more appropriate value 
for small refiners) or 5 percent, or eliminating any ``dollar'' amount 
because no one should be penalized because its investment fails to meet 
arbitrary time or cost criteria. EPA believes that such criteria must 
be specified in order to prevent a proliferation of adjustments for 
other than true hardship cases. Additionally, the proposed criteria are 
fairly stringent requirements, and more stringent requirements could 
threaten the viability of some refiners. EPA could have relaxed the 
criteria, i.e., set a lower dollar amount. However, as stated, the WIP 
provision was included to provide relief for those projects that would 
significantly financially impact the refiner, and not for 
inconsequential modifications. Thus either the ``10 percent'' criteria 
or the $10 million criteria will be allowed to satisfy this 
requirement.
    Many comments and suggested language were received concerning EPA's 
February 26, 1993 proposal that a WIP adjustment would simultaneously 
cap a refiner's anti-dumping emissions and sulfur, T90 and olefin 
values at five (5) percent over the corresponding statutory baseline 
values. Most commenters opposed such simultaneous caps. EPA also 
proposed that a refiner whose WIP-adjusted baseline emissions exceeded 
105 percent of anti-dumping statutory baseline emissions did not have 
to reduce its emissions further (to 105 percent of the anti-dumping 
statutory baseline) if its WIP-adjusted baseline emissions were less 
than its pre-WIP baseline emissions. EPA believes though that some 
limit on the adjustment must be included to minimize environmental 
harm. The limit must apply to all who are allowed a WIP adjustment. 
Thus, EPA is limiting WIP increases in baseline exhaust benzene, 
exhaust toxics and NOX emissions and sulfur, olefins and T90 
values to the larger of (1) the unadjusted individual baseline value of 
each emission or fuel parameter or (2) 105 percent of the corresponding 
anti-dumping statutory baseline value. Note that sulfur, olefins and 
T90 are only constrained when compliance is determined using the simple 
model. When compliance is determined using the complex model, the WIP-
adjusted values of these three fuel parameters are not subject to the 
caps. Given EPA's discretion in even granting WIP adjustments, EPA 
believes this provision provides an acceptable balance between allowing 
WIP adjustments and ensuring that increases in emissions over 1990 
levels are minimized.
    g. Baseline adjustment for extraordinary circumstances. In the 
February 26, 1993 proposal, EPA requested comments on allowing the 
baseline fuel parameters, volumes and emissions of a refinery to be 
adjusted due to the occurrence of specific extraordinary or extenuating 
circumstances which caused its 1990 gasoline production to be different 
than it would have been had the circumstance not occurred. Many 
commenters felt that baseline adjustments should be allowed for the 
proposed situations as well as for others. One commenter stated that 
every site is unique, thus baseline adjustments should be evaluated on 
a case-by-case basis. Still others suggested that EPA allow adjustments 
only for small refiners, or for several other specific circumstances. 
Several commenters, however, felt that no extenuating circumstance 
baseline adjustment should be allowed. Among the reasons cited for not 
allowing adjustments were: competitive inequities; Congressional intent 
to account for 1990 only; difficulty in defining extenuating 
circumstances; use of this provision as a method of voiding work-in-
progress requirements.
    While EPA's policy objective is not to establish a broad adjustment 
program, EPA is allowing adjustments for specific extenuating 
circumstances. Allowable circumstances include unforeseen, unplanned 
downtime of at least 30 days of one or more gasoline blendstock 
producing units due to equipment failure or natural cause beyond the 
control of the refiner, or for nonannual maintenance (turnaround) 
downtime which occurred in 1990. These types of adjustments reflect 
instances where the 1990 baseline truly deviated from the otherwise 
expected baseline (historic and future), had the incident not occurred.
    EPA is also permitting baseline adjustments for certain refiners 
which produced JP-4 jet fuel in 1990. As discussed in the RIA, EPA 
believes that it has authority to allow such adjustments due to the 
discretion afforded EPA by Congress. Additionally, Alabama Power v. 
Costle77 gives EPA ``case-by-case discretion'' to grant variances 
or even dispensation from a rule where imposition of the requirement 
would result in minimal environmental benefit but the would extremely 
burden a regulated party. While the anti-dumping requirements, in 
general, apply to all conventional gasoline whether or not reformulated 
gasoline is also produced, under the criteria mentioned above, no 
``dumping'' will occur since no reformulated gasoline will be produced 
by such refiners. Congressional intent with regard to the anti-dumping 
program will be met while not unduly burdening those that meet the 
specified criteria.
---------------------------------------------------------------------------

    \7\7Alabama Power Company v. Costle, 636 F.2d 323.357 (D.C. Cir 
1979).
---------------------------------------------------------------------------

    JP-4 baseline adjustments are generally limited to single-refinery 
refiners because such refiners have no way to aggregate 
baselines78 so as to reduce the combined burden of JP-4 phaseout 
and the anti-dumping requirements on their operations. In some cases, 
if no relief were granted in this area, the viability of a refinery 
could be at stake. EPA is also allowing baseline adjustments for multi-
refinery refiners as long as each of the refineries meets all of the 
specified criteria.
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    \7\8As discussed in paragraph 6.d, a refiner with more than one 
refinery may determine an aggregate baseline, i.e., a conventional 
gasoline compliance baseline, which consists of the volume-weighted 
emissions or fuel parameters, as applicable, of two or more 
refineries.
---------------------------------------------------------------------------

    JP-4 production must have also constituted a significant portion of 
a refiner's 1990 production in order for a significant burden to exist. 
In its February 1993 proposal, EPA requested comment on what minimum 
portion of a refinery's 1990 production JP-4 should have constituted 
for the circumstance to be extenuating, and several different ratio 
options were suggested by commenters, as discussed in the RIA. As 
discussed in the RIA, EPA is requiring that the ratio of the refinery's 
1990 JP-4 production to its 1990 gasoline production must equal or 
exceed 0.5.
    While the adjusted emission baselines of those approved for JP-4 
adjustments are likely to be higher than their actual 1990 baselines 
(primarily due to increased benzene and aromatics) EPA expects minimal 
negative environmental affects. Because the number of refineries 
meeting the criteria is expected to be small and the total production 
of all such refineries is also small, less gasoline is affected by any 
baseline adjustments than if the criteria were less stringent. In this 
situation, EPA believes that any negative environmental effects 
resulting from the allowed adjustments are justifiably balanced by the 
reduced burden on qualifying refiners.
    Although EPA is allowing baseline adjustments for the specific 
circumstances described above, it in no way means this to be a 
precedent to allow adjustments for actual or so-called extenuating 
circumstances now or in the future. The language of the Act does not 
allow EPA to broadly permit baseline adjustments. Additionally, a 
baseline is neither unrepresentative of 1990, nor incalculable, because 
of post-1990 changes in crude availability, fuel specifications, fuel 
markets, etc. Congress certainly knew that such changes could affect 
baseline determinations, yet in creating the anti-dumping requirements 
it did not require EPA to consider such factors in determining 
baselines. In fact, no direction was given to account for two mandated 
fuel changes, Phase II volatility control and lead phaseout.
    It is likely that circumstances for which baseline adjustments are 
not allowed may negatively affect some refiners. However, every refiner 
will be subject to future changes in markets, fuel quality 
requirements, etc., all of which will affect the refiner's gasoline 
quality and ability to comply with its anti-dumping baseline. Thus, 
except in extreme cases, baseline adjustments due to post-1990 changes 
which affect refiners would not be practical (due to the myriad 
circumstances which may exist) nor necessarily fair, and are definitely 
not supported by the language of the Act nor the intent of Congress. 
EPA is appropriately not providing for such adjustments.
    h. Inability to meet these requirements. Although not previously 
discussed, EPA realizes that many unique circumstances will arise 
regarding the baseline determination. As such, if a refiner or importer 
is unable to comply with one or more of the requirements specified for 
baseline determination, it may be allowed to accommodate the lack of 
compliance in a reasonable, technically sound manner. It must petition 
EPA for such a variance, and the alternative must be verified by the 
baseline auditor. The petition may or may not be approved by EPA.
6. Baseline Volume and Emissions Determination
    a. Individual baseline volumes for refiners, blenders and 
importers. The individual baseline volume of a refiner which utilizes 
Methods 1, 2 and or 3-type data to determine its baseline fuel 
parameters shall be the larger of the total volume of gasoline produced 
in or shipped from the refinery in 1990, excluding volumes exported. 
This provision is added because 1990 shipments and production could 
differ. As discussed in the RIA, while 1990 gasoline shipments actually 
contributed to emissions, data is available (by Methods 1, 2 or 3) on 
1990 gasoline production. The difference between the shipped and 
produced gasoline is expected to be negligible with respect to baseline 
determination. Volumes of oxygenates blended into gasoline at the 
refinery and oxygenate assumed or shown to have been blended into 
gasoline downstream of the refinery, as discussed in paragraph 3.b, 
shall be included. The baseline volume shall be determined after all 
adjustments, such as for work-in-progress or extenuating circumstances, 
have been performed.
    The individual baseline volume of a blender utilizing only Method 
1-type data or having the anti-dumping statutory baseline as its 
individual baseline shall be also the larger of the volume of 1990 
gasoline produced in or shipped from the refinery (blending facility). 
The individual baseline volume of an importer utilizing only Method 1 
or having the anti-dumping statutory baseline as its individual 
baseline shall be the total volume of gasoline imported into the U.S. 
in 1990.
    b. Limitations on applicability of individual baselines. In the 
April 16, 1992 proposal, EPA proposed to limit the applicability of a 
refiner's or importer's individual baseline to a certain portion of its 
post-1994 conventional gasoline production or imports and apply the 
anti-dumping statutory baseline parameter values to the volume in 
excess of this amount. This excess amount would reflect the portion of 
the post-1994 growth in gasoline production over 1990 volumes that is 
attributed to conventional gasoline. The refiner or importer would 
comply with the production weighted average of the two resulting 
baseline emission figures.
    Most of the commenters agreed that the increase in conventional 
gasoline production over this baseline volume should be subject to the 
statutory baseline. However, commenters disagreed as to whether the 
increase should be determined relative to actual production or relative 
to capacity. In addition to agreeing with the proposal, those favoring 
production as the basis cited the difficulty in determining gasoline 
refining capacity. Those favoring capacity as the basis commented that 
if baselines are applied on a production basis, conventional gasoline 
production could be limited below capacity and reduce the capability to 
supply conventional gasoline to some markets. Also, commenters claimed 
that factors such as the Persian Gulf war and the phaseout of JP-4 jet 
fuel made 1990 production unrepresentative of normal industry refining 
activity.
    While EPA agrees that 1990 production may have been 
unrepresentative of normal operations in some ways, it believes that 
some unusual circumstances occur every year and the limitation of 
individual baselines to 1990 production, as described above and in the 
RIA, is the better choice for minimizing emission increases and market 
distortions. Thus EPA is promulgating this requirement as proposed 
except that baseline volume shall be based on 1990 gasoline shipments 
rather than production. Gasoline shipments better reflect volumes 
actually in the market in 1990. For a refiner, its 1990 total volume 
would be its 1990 actual gasoline shipments, including adjustments to 
account for WIP or extenuating circumstances, and including oxygenate 
volume.
    c. Baseline emissions determination. Every refinery must develop a 
set of individual baseline parameters, volume and emissions. Prior to 
1/1/98, compliance with baseline emissions must be determined using 
either the simple or complex model equations for exhaust benzene. In 
the case of the simple model, only fuel benzene and fuel aromatics are 
considered--VOC changes which may affect benzene emissions are not 
considered. Beginning 1/1/98, compliance with baseline emissions must 
be determined using the complex model for total exhaust toxics and 
NOX.
    As discussed in Section IV, there are separate complex models from 
which to determine summer and winter emissions. As such, average 
baseline fuel parameters must be determined separately for summer and 
winter. Conventional gasoline baseline emissions (and sulfur, olefins 
and T90 values) will first be determined separately, on a summer and 
winter basis, using summer and winter fuel parameter values (except 
that average winter RVP will be 8.7 psi, as discussed in the RIA). The 
summer and winter emissions (and sulfur, olefins and T90 values) will 
then be weighted by the respective summer and winter baseline volumes 
to determine annual average baseline emissions (and sulfur, olefins and 
T90 values). Compliance is determined in a similar manner.
    As also discussed in Section IV, there are two complex models--one 
for use prior to 2000 and one for use in 2000 and beyond. As such, 
every refinery will have two sets of baseline total exhaust toxics and 
NOX emissions--one set applicable prior to 2000, and one in 2000 
and beyond. Note that baseline fuel parameter values and volume do not 
change, only the emissions determined from those parameters. In the 
case of NOX, it is likely that every refinery will actually have 
four potential baseline NOX emissions values, depending on whether 
a nonoxygenated or an oxygenated baseline is used to evaluate NOx 
emissions (see discussion in paragraph 5.e).
    Many commenters were also concerned about the effect of future 
revisions to the complex model on 1990 baseline emissions and future 
compliance, particularly should additional fuel parameters be added to 
the model. In the event of revisions to the complex model, EPA will 
promulgate additional regulations which will consider the impact on 
conventional gasoline, including consideration of lead time, cost and 
other factors.
    d. Conventional gasoline compliance baselines. The Clean Air Act 
refers to gasoline sold by a refiner, blender or importer (section 
211(k)(8)(A)), but does not specify an averaging unit for baseline 
determination nor whether gasoline and the resulting emissions should 
be treated on a refinery or refiner basis, thus authorizing EPA to 
adopt the most appropriate method of complying with the anti-dumping 
requirements. EPA considered three possible options for baseline 
determination--refinery basis, refiner basis, or some combination of 
the two. During the regulatory negotiation, it was agreed that EPA 
would propose allowing a refiner to elect to establish an individual 
baseline. In the April 1992 proposal, EPA proposed that refiners could 
choose either refiner-wide averaging or refinery-by-refinery averaging, 
but not a combination of the two. This was to avoid situations where 
multi-refinery refiners could game the system and potentially gain a 
significant competitive advantage over single-refinery refiners.
    Although, as stated, EPA expressed concern about multi-refinery 
refiners' having an advantage over single-refinery refiners, few 
commenters agreed with EPA's April 1992 proposal. Of those that did 
agree, some suggested that all refineries should be required to comply 
with their individual baselines, to minimize any advantages for multi-
refinery companies over single refinery companies.
    However, most of the comments received on this issue claimed that 
EPA had not interpreted this provision correctly from the Agreement-in-
Principle. The agreement, according to the commenters, allowed refiners 
to decide how to aggregate their refineries' baselines. Some suggested 
that if aggregations are only allowed as proposed, compliance with the 
simple model, complex model and/or anti-dumping requirements would be 
difficult.
    Upon further consideration of this issue, EPA is allowing refiners 
to choose to have one or more individual refinery conventional gasoline 
compliance baselines and one or more ``refiner'' baselines (i.e., more 
than one grouping of two or more refineries to form a compliance 
baseline). Because the decision to group or not group refineries is a 
onetime decision, and because a refiner's total emissions will be 
conserved, the possibility of gaming will be reduced. When two or more 
refineries are grouped for the purpose of having a single conventional 
gasoline compliance baseline, the refineries shall be considered 
``aggregated'', and the resulting baseline shall be an ``aggregate'' 
baseline.
    Aggregate baselines are determined by volume-weighting the baseline 
emissions and sulfur, olefin and T90 values of the aggregated 
facilities. If aggregated, all NOX baselines in an aggregate must 
be determined either on a nonoxygenated or an oxygenated basis, using 
the corresponding nonoxygenated or oxygenated baseline parameters. The 
choice of whether a refinery has its own individual baseline or is part 
of an aggregate baseline is a one-time decision, i.e., refineries 
cannot be re-aggregated annually. Also, an individual baseline 
(including both parameter and emission values) must be calculated for 
each refinery, whether that refinery will be part of an aggregate 
baseline or not. This is required because reformulated gasoline 
compliance under either the simple model or early use of the complex 
model is on a refinery basis. Also, individual baselines must be known 
in the event that a refinery is sold or shut down, or other reason why 
the baseline would need to be recalculated.
    EPA also proposed to require individual refinery baselines for 
refineries located in specific isolated geographic areas where 
localized dumping was occurring. EPA is retaining this proposal in the 
final rule. Few comments were received on this issue and are addressed 
in the RIA.
    e. Baseline recalculation. In its April 16, 1992 proposal, EPA 
proposed certain instances when baselines would have to be 
recalculated. Few adverse comments were received. In the case of a 
refinery which is shut down after 1990, EPA had proposed that an 
aggregate baseline which contained the shutdown refinery would not 
change unless the shutdown refinery was sold. However, upon further 
consideration, EPA believes that it is more appropriate, and more 
consistent with the other recalculation requirements, to remove a 
shutdown refinery's contributions to an aggregate baseline. EPA is thus 
promulgating this requirement with the other proposed requirements.

D. Baseline Auditor

    In the February 26, 1993 proposal, EPA expanded on the 
qualifications and responsibilities of the baseline auditor which each 
refiner or importer must utilize to verify its baseline. Refiners and 
importers utilizing the anti-dumping statutory baseline, if so allowed, 
are not required to have a baseline auditor.
1. Auditor Qualifications
    EPA proposed specific criteria for determining the independence and 
technical capability of the auditor (and where applicable, the 
auditor's organization and/or certain persons working with or for the 
auditor). A few commenters suggested minor changes in the proposed 
criteria as discussed in the RIA, and some of these recommendations are 
incorporated in the final rule.
    EPA also proposed that the auditor retained by a refiner or 
importer may also have developed the baseline for the same refiner or 
importer as long as all other auditor qualification requirements were 
met. Several commenters who addressed this issue agreed that the 
auditor should be allowed to also be the baseline preparer, mostly from 
a cost savings point-of-view. Other commenters pointed out that the 
independence of the review would be lost. While this may diminish to 
some extent the value of an independent audit, the cost and time 
savings are relevant considerations. In balancing these concerns, EPA 
is allowing the auditor to also have prepared the baseline.
2. Auditor Certification
    EPA proposed two options by which potential auditors could be 
approved by EPA as qualified to audit baselines. One option involved 
precertification by EPA; under this option, a statement of the 
auditor's qualifications would be submitted to EPA. EPA would 
officially certify an auditor, or if no comment were received from EPA 
within a specified time, the auditor would be considered certified by 
default. The other option required the refiner or importer to ensure 
that the auditor is qualified, and to provide a qualification statement 
for the auditor with the baseline submission. In this case, the auditor 
would not be pre-certified by EPA.
    Most commenters agreed with allowing both options. One commenter 
thought that EPA should notify auditors of approval rather than letting 
them be certified by default, and that they should be pre-certified. 
EPA believes that, in most cases, it will respond in some form, not 
necessarily approval or disapproval, prior to the end of the allowable 
time period. In the proposal, EPA allowed the auditor to be certified 
by default after 30 days. However, EPA now believes that it should not 
allow an auditor to be certified by default until 45 days after 
application or today's date, whichever is later, because of possible 
delays, e.g., mail delivery, in receiving an auditor's qualification 
statement.
    EPA had also proposed that within thirty (30) days of hiring a 
baseline auditor or today's date, whichever is later, each refiner and 
importer must inform EPA of the name, organization address and 
telephone number of the auditor hired. EPA now believes this 
information is not critical and thus is eliminating this requirement. 
This information is only required in the baseline submission.
3. Auditor Responsibilities
    The major issues raised by commenters concerning auditor 
responsibilities was whether the auditor was to verify the baseline 
determination or recalculate the baseline itself. EPA agrees that the 
auditor should independently verify the baseline determination, and is 
not required to develop a second baseline determination. However, the 
auditor must take whatever action is necessary to ensure that all 
baseline submission requirements are fulfilled. EPA is also requiring 
that a refiner's baseline submission include a statement prepared and 
signed by the primary analyst stating that, to the best of its 
knowledge, it has thoroughly reviewed the sampling methodology and 
baseline calculations, and that they meet the requirements and 
intentions of the rulemaking, and that it agrees with the final 
baseline parameter and emission values listed in the baseline 
submission. EPA is not requiring auditors to submit (to EPA) an audit 
plan prior to beginning the baseline verification process.

E. Baseline Submission and Approval

1. Timing
    Few comments were received concerning the timing of baseline 
submissions, and EPA is promulgating its requirements that baselines be 
submitted to EPA within 6 months of today's date and that baselines 
determined using data collected after today be submitted to EPA by 
September 1, 1994. EPA will consider petitions for an extension of 
these deadlines, however, submitters should take note that late 
submissions could cause delays in receiving EPA decisions on approval 
of their baselines. EPA is promulgating such timing requirements in 
order to give the industry sufficient time to generate and audit 
individual baselines. EPA is well aware of the need for expeditious 
review of submitted baselines, and encourages submission of baselines 
as soon as possible after today.
2. Petitions
    In many situations in the baseline determination, a refiner or 
importer is required to petition EPA in order to be allowed to account 
for a variance from a requirement. In other situations, the refiner or 
importer is required to ``show'' that it meets certain criteria. In 
either of these situations, approval will be given by the Director of 
the EPA's Office of Mobile Sources, or designee. As will be discussed 
below, all petitions must be included in the baseline submission--in 
fact, in most cases, baseline calculations have to be determined both 
with and without the requested variance, since the outcome of the 
request would be unknown. Although not previously proposed, EPA is 
allowing petitions and ``showings'' to be submitted prior to the 
baseline submission deadline although an early decision on the request 
is not guaranteed. Nonetheless, the baseline submission must be 
submitted by the applicable deadline, whether or not EPA has decided to 
approve or disapprove the request.
3. Submission Requirements
    Based on comments to its proposals, EPA has determined that a 
number of its proposed baseline submission requirements were not 
pertinent to a baseline determination. EPA is thus requiring that, at 
minimum, the information described in Sec. 80.93 be included in the 
baseline submission. Information on crudes and refinery unit operations 
is still required because EPA may wish to evaluate baseline submissions 
using a refinery flow simulation system. EPA plans to develop a sample 
baseline submission document which should be available soon after 
today.
    Although not previously required in the baseline submission, the 
blendstock-to-gasoline ratio for each calendar year 1990 through 1993 
must now be included. The blendstock-to-gasoline ratio is discussed 
further in Section IX, and is defined in Sec. 80.102. Determination of 
this ratio is also subject to auditor verification, as is the entire 
baseline submission.
    EPA may require submittal of more extensive data if such data is 
required to aid EPA in its review of the baseline submission, or if 
discrepancies in any part of the baseline submission are found. 
Additional information that may be useful to EPA in its evaluation of 
the baseline submission may be included, at the refiner's discretion.
    EPA is slightly expanding the content required in the statement 
signed by the chief executive officer which is included in the baseline 
submission. The statement must state that the data submitted is the 
extent of the data available for the determination of each of the 
required baseline fuel parameter values, that sampling methodology and 
baseline calculations meet the requirements and intentions of the 
rulemaking, and that the final baseline parameter and emission values 
listed represent its 1990 gasoline, to the best of his or her 
knowledge.
    If a refiner or importer desires that certain information in the 
baseline submission not be publicly available, it must a assert a claim 
of confidentiality, as discussed below, and include this request in the 
baseline submission.
4. Baseline Approval
    EPA will approve baselines and upon approval publish, in the 
Federal Register, the standards for each applicable gasoline producing 
or importing facility of a refiner, blender or importer. Because a 
party's baseline will become its standard for compliance with the anti-
dumping and early reformulated gasoline requirements, EPA believes the 
standard should be publicly known, and as discussed below, there are no 
compelling reasons not to publish such information. Additionally, such 
standards are not entitled to confidential treatment (40 CFR 2.301(e), 
special confidentiality rules applicable to Clean Air Act cases). Thus, 
upon Agency approval of a baseline, the baseline exhaust benzene, 
exhaust toxics and NOX emissions values and 125 percent of the 
baseline sulfur, olefins and T90 values shall be published. This 
information is required on a refinery or facility basis because the 
reformulated gasoline requirements are on a refinery-basis, and because 
this information needs to be known in the event a refinery changes 
owners.
    While EPA previously proposed that it would publish baseline 
parameter values by refinery, it now believes that no substantive 
comments could result from publishing such information because of the 
complexity of the baseline determination. Additionally, EPA realizes 
that certain aspects of the baseline determination must necessarily 
remain confidential in order to prevent serious, negative competitive 
effects. Thus EPA is allowing any person or organization providing 
information to EPA in connection with the determination of a baseline, 
including establishing a baseline or investigating possible baseline 
discrepancies, to assert that some or all of the information submitted, 
except the baseline emissions or parameter values which are the 
standard for a refiner, refinery or importer, is entitled to 
confidential treatment as provided in 40 CFR part 2, subpart 2. Such 
confidential information shall be clearly distinguished from other 
information to the greatest extent possible, and clearly labeled 
``Confidential Business Information.'' Information covered by a claim 
of confidentiality will be released by EPA only to the extent allowed 
by procedures set forth in 40 CFR part 2, subpart B. Failure to submit 
a claim of confidentiality with submission of the baseline, however, 
may lead to release of information by EPA without further notice to the 
submitter (40 CFR 2.203 (a) and (c)).
    Most comments on this topic addressed the publication of individual 
baseline information. Several commenters suggested publishing a 
refiner's or importer's anti-dumping index (ADI), a ratio of the 
individual baseline emissions to the statutory baseline emissions. 
However, there is little difference between this value and the actual 
value if the statutory baseline emissions are known. Another suggestion 
included providing such information only upon request. Again, there is 
little difference between ``on request'' and publishing such 
information at one time. One commenter stated that no where in the 
statute was publication of baseline data required. While that is true, 
EPA must release the standards (and any other non-CBI information) upon 
request, and there are benefits from publishing them, e.g., citizen 
suit enforcement, more information to the general public about EPA's 
standards, better deterrence to noncompliance. Commenters did not 
provide any clear or compelling reason for not publishing the 
standards, and there are benefits from publishing them, as discussed. 
Additional comments, which did not affect the final rule, and EPA 
responses can be found in the RIA.

IX. Anti-Dumping Compliance and Enforcement Requirements for 
Conventional Gasoline

    The final rule implements section 211(k)(8) of the Clean Air Act 
which provides that beginning January 1, 1995, average per gallon 
emissions of specified pollutants from non-reformulated or conventional 
gasoline use must not deteriorate relative to emissions from 1990 
gasoline on a refiner or importer basis. This could occur, for example, 
if fuel components or properties that cause harmful emissions and that 
are removed from or limited in reformulated gasoline, are ``dumped'' 
into conventional (non-reformulated) gasoline. As a result, the ``anti-
dumping'' program limits the emissions of specified pollutants from 
conventional gasolines, and under certain circumstances from 
blendstocks (based on EPA's authority under section 211(k)(c) of the 
Act).
    The final rule differs from the earlier proposals primarily in the 
area of blendstock accounting. These changes are discussed in greater 
detail below.
    Refiners and importers must establish individual 1990 baselines in 
order to compare the emissions characteristics of gasoline they 
produced or imported in 1990 with the emissions characteristics of 
conventional gasoline produced or imported in 1995 and later. See 
section VIII for a discussion of the methods required for development 
of an individual baseline. The baseline for refiners who were not in 
business in 1990, and in certain cases for other importers and refiner-
blenders, is the statutory baseline found at Sec. 80.91(c)(5) of the 
regulations.
    Refiners who operate more than one refinery have the option of 
demonstrating compliance with the anti-dumping provisions for each 
refinery separately, or the refiner may group its refineries and show 
compliance for each group separately provided that each refinery's 
performance is accounted for either separately or as part of a refinery 
group. The refiner's refinery-grouping election may not be changed 
after the initial election. Blendstock tracking and accounting as 
discussed below, must be determined in accordance with the same 
refinery grouping as chosen for compliance purposes.
    The final rule has three separate sets of compliance standards for 
determining compliance with the anti-dumping requirements, however, 
only one set applies to a refiner or importer at any one time. These 
are the Simple Model standards and Optional Complex Model standards, 
that apply in 1995, 1996, and 1997; and the Mandatory Complex Model 
standards that apply in 1998 and thereafter. All three sets of 
standards require refiners and importers to average certain properties 
of conventional gasoline and demonstrate compliance with prescribed 
standards, which in some cases are actual fuel properties and in others 
are emissions products calculated from specific fuel properties.79
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    \7\9 For a discussion of issues concerning which properties or 
pollutants are covered in the federal anti-dumping program, see 
section VIII of this preamble and the Notice of Proposed Rulemaking, 
published July 9, 1991 (56 FR 31219-31222).
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    Under the Simple Model standards, a refiner or importer is required 
to demonstrate on an annual basis that average exhaust benzene 
emissions of conventional gasoline do not exceed the refiner's or 
importer's 1990 compliance baseline for exhaust benzene emissions, and 
that average sulfur, olefins and T90 each do not exceed 125% of the 
refiner's or importer's 1990 average levels for each of these 
parameters. Under the Optional Complex Model standards, annual average 
levels of exhaust benzene emissions, volume weighted for each batch as 
determined under the applicable model, may not exceed the refiner's or 
importer's 1990 average exhaust benzene emissions calculated in the 
same manner. Under the Mandatory Complex Model standards, annual 
average levels of exhaust toxic emissions and NOX emissions, 
volume weighted for each batch as determined under the applicable 
model, may not exceed the refiner's or importer's 1990 average levels 
for exhaust toxic emissions and NOX emissions calculated in the 
same manner. Refiners and importers are required to determine the 
emissions performance for each batch of gasoline in either the 
applicable summer or winter model based on whether or not the batch has 
been designated to comply with EPA volatility requirements.
    The final rule provides that in 1995, 1996, and 1997, refiners and 
importers may determine compliance based on either the Simple Model 
standards or the Optional Complex Model standards, at their option. 
However, a refiner that produces reformulated gasoline under the Simple 
Model must use the Simple Model anti-dumping standards, and a refiner 
that produces reformulated gasoline under the optional complex model 
must use with the Optional Complex Model anti-dumping standards.
    Refiners and importers are required to include the following 
products, which are produced or imported during each averaging period, 
in anti-dumping compliance calculations: conventional gasoline; non-
gasoline petroleum products if required under the blendstock accounting 
provisions (discussed below); and gasoline blending stock which becomes 
conventional gasoline upon the addition of oxygenate (discussed below).
    In addition, oxygenate that is added to a refiner's or importer's 
gasoline or blendstock downstream of the refinery or import facility 
may be included in the refiner's or importer's compliance calculations 
only if the refiner or importer is able to demonstrate with certainty 
that the oxygenate has been added to that party's gasoline. Provisions 
are included in the final rule for the manner in which refiners and 
importers must make this demonstration.
    Oxygenate blended downstream may be counted by a refiner or 
importer if the refiner or importer demonstrates that it performed the 
oxygenate blending. In addition, the oxygenate may be counted if the 
blending is conducted by a blender with whom the refiner or importer 
has a contract that specifies procedures intended to ensure proper 
blending, and the refiner or importer monitors the downstream blending 
operation through audits, inspections, and sampling and testing of the 
gasoline produced at the blending operation. These downstream oxygenate 
blending provisions are discussed more fully below.
    Refiners and importers also have the option of determining 
compliance for exhaust NOX emissions performance either with or 
without the inclusion of oxygenates provided that the baseline NOX 
performance is determined in the same manner. Refiners and importers 
may elect to switch one time under certain conditions which are 
discussed more fully in Section VIII of the Regulatory Impact Analysis.
    Enforcement of the anti-dumping standards under this rule consists 
of a combination of mechanisms to monitor compliance with the 
regulations, including: refiner/importer sampling and testing of 
gasoline produced or imported; record keeping; reporting; annual audits 
by refiners and importers; and Agency audits.
    The final rule specifies the manner in which penalties will be 
determined for violations of the anti-dumping requirements of the final 
rule. These penalty provisions include calculations of the number of 
days of violation, and presumptions regarding the properties of 
gasoline.
    Under the anti-dumping requirements in the final rule, certain 
refiners are also required to account for blendstocks that are 
produced. The principal policy reason for imposing blendstock tracking 
and accounting is that, unless proscribed, certain refiners will have 
an incentive to transfer blendstocks based on the differences in 
baselines that will exist. These differences thus could result in the 
transfer of the ``production'' of gasoline from a refinery with a more 
rigorous baseline to another refinery with a less rigorous baseline, 
through the transfer of blendstocks. This transfer-of-blendstocks 
concern is described more fully below.
    Refiners and importers are required to establish a baseline of the 
volume of certain specified blendstocks80 produced and transferred 
to others, relative to the volume of gasoline produced (the 
``blendstock-to-gasoline ratio''). This baseline is established by 
determining, for each calendar year 1990 through 1993, the volumes of 
blendstocks produced and transferred, the volumes of gasoline produced, 
and calculating the annual and four-year average blendstock-to-gasoline 
ratios. Refiners may include in baseline calculations only those 
volumes of blendstocks for which the refiner is able to demonstrate the 
blendstock was used in the production of gasoline. This baseline 
blendstock-to-gasoline ratio must be established using the baseline 
auditing procedures described in Sec. 80.93.
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    \8\0The blendstock tracking requirements apply only to certain 
blendstocks that have properties that are ``dirtier'' than the 1990 
Clean Air Act average fuel parameters for anti-dumping. Use of the 
term ``blendstock'' also means that tracking applies only to non-
gasoline petroleum products that are used in the production of 
gasoline (see 40 CFR 80.2(s)). As a result, refiners and importers 
are not required to track non-gasoline petroleum products where the 
refiner or importer can demonstrate these products are used for a 
purpose other than gasoline blending.
---------------------------------------------------------------------------

    Beginning in 1995, refiners are required to determine the 
blendstock-to-gasoline ratio for each calendar year compliance period. 
This compliance period ratio is then compared with the baseline ratio. 
During each year 1995 through 1997, the annual compliance period ratio 
is compared with the largest ratio of the individual annual baseline 
ratios. Beginning in 1998, the compliance period ratio will be the 
running four-year average of the annual ratios,81 instead of an 
annual ratio. This is then compared with the baseline four-year average 
ratio.
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    \8\1 In 1998, the compliance period ratio consists of the 
average of the ratios for 1995 through 1998; in 1999, the compliance 
period ratio consists of the average of the ratios for 1996 through 
1999; etc.
---------------------------------------------------------------------------

    In the case of both the annual comparisons before 1998, and the 
average comparisons beginning in 1998, if the compliance period ratio 
exceeds the baseline ratio by ten percent or more special blendstock 
accounting must be carried out by the refiner, unless certain 
exemptions are met or the refiner has been granted a waiver by 
EPA.82 These exceptions to blendstock accounting are discussed 
more fully below.
---------------------------------------------------------------------------

    \8\2 For example, if the largest baseline annual ratio for a 
refinery is 5%, and the 1995 ratio for that refinery is 10%, this 
increase would be 100%, and special blendstock accounting would be 
required for that refinery unless exempted for other reasons.
---------------------------------------------------------------------------

    In a case where special blendstock accounting is required, the 
refiner must include the properties of all blendstocks produced in its 
compliance calculations for the two subsequent averaging periods. In 
addition, the refiner must notify any recipients of such ``accounted-
for'' blendstocks that the downstream party may not include the 
properties in that party's calculations. The second and subsequent 
times that the compliance period ratio exceeds the ten percent 
threshold, special blendstock accounting is required for the four years 
subsequent to the second exceedance.
    The final rule includes a provision that allows a refiner to 
petition for a waiver from special blendstock accounting in a case 
where the volume of blendstock produced is the result of extreme or 
unusual circumstances which are clearly outside the control of the 
refiner and could not have been avoided, such as fire, accident, or 
natural disaster.
    Blendstock tracking is limited under the final rule. Refiners with 
an annual compliance period blendstock-to-gasoline ratio of three 
percent or less are exempt from special blendstock accounting, 
regardless of how the compliance period ratio compares with the 
baseline ratio. This exemption is included because, in such a 
circumstance, there are limited environmental effects, and the party 
has a limited ability to gain economic advantage from transferring 
production to a less rigorous baseline.
    The final rule also excludes from the blendstock tracking and 
accounting requirements blendstocks that are exported, transferred to a 
refiner for use as a refinery feedstock, or are transferred between 
refineries that have been aggregated under a common baseline. Also 
excluded are transfers for other than gasoline blending purposes, e.g., 
transfers of product for use in a chemical process, because such other-
than-gasoline-blending use renders the product non-blendstock by 
definition. Such transactions are not indicative of an attempt by a 
refiner to gain an improper baseline.

A. Blendstock Accounting

    EPA's 1991 Notice Of Proposed Rulemaking for the anti-dumping 
program proposed compliance based on the properties of finished 
gasoline only and did not address accounting for blendstocks. 
Commenters on this Notice stated that the proposed anti-dumping 
regulations would create the opportunity for certain refiners to avoid 
the normally-applicable baseline through the transfer of gasoline 
blendstocks to another refiner with a more lenient baseline. This 
opportunity derives from the fact that the 1990 individual baseline for 
a large percentage of the refiners is more stringent than the 1990 
average. According to the commenters, a refiner who operates a refinery 
with such a more-stringent-than-average baseline could effectively 
achieve an easier baseline by shifting blendstocks produced at that 
refinery to another refinery with a less stringent baseline. Gasoline 
could then be ``produced'' at the blendstock-transferee refinery using 
blendstocks produced at the blendstock-transferor refinery. This 
strategy could be accomplished, for example, through the transfer of 
blendstocks to a refiner-blender who would use the statutory average 
baseline, such as a new business. Commenters stated concern that 
refiners using this strategy would achieve a significant competitive 
advantage.
    EPA agreed with these concerns, and in the 1992 Supplemental Notice 
of Proposed Rulemaking proposed requirements on the methods of 
accounting for gasoline blendstocks. This blendstock accounting 
proposal was included to limit the adverse environmental effects of 
such production transfers, by ensuring that each refiner meets the 
anti-dumping standards using the baseline that properly applies to the 
refiner.
    In order to avoid the baseline-shifting possibility, EPA proposed 
that refiners would be required to either include in the refinery 
compliance calculations all blendstocks produced at a refinery, or the 
products would be prohibited for subsequent use in blending gasoline. 
Under this proposal, refiners would be required, with certain 
exceptions, to chemically mark un-accounted-for products to ensure they 
are not used by downstream parties for gasoline blending. This proposal 
included provisions intended to ensure that blendstock would be 
included in anti-dumping compliance calculations by only one refiner, 
and prohibitions intended to prevent the use of marked petroleum 
products in gasoline production.
    Commenters on the 1992 proposal objected to the blendstock 
accounting/marking scheme because of its impact on the refining 
industry. Commenters raised concerns regarding the liability scheme and 
the paperwork requirements associated with the accounting and the 
marking of blendstocks. Commenters also contended that the marking of 
blendstocks would be disruptive to the chemical industry.
    In response to these comments, EPA proposed a significantly revised 
blendstock accounting mechanism in the 1993 Supplemental Notice of 
Proposed Rulemaking. This proposal eliminated the requirement that 
refiners account-for or mark blendstocks and eliminated the 
prohibitions and liabilities associated with the use of marked 
blendstock. Under this revised mechanism, refiners would be required to 
monitor the volume of certain blendstocks produced at each refinery 
relative to the volume of gasoline produced. If for any year the 
proportion of a refinery's production that is blendstock (the 
``blendstock-to-gasoline ratio'') increased relative to the refinery's 
baseline blendstock-to-gasoline ratio by ten percent or more, with 
certain exceptions the refinery would be required to account for all 
blendstocks produced at the refinery during the year of the failure, or 
in the alternative any blender-recipient of blendstock produced at that 
refinery would be required to use the refinery's baseline when 
accounting for such blendstock during the year of the failure.
    Under the proposal, a refiner would be exempt from special 
blendstock accounting if the refiner's blendstock-to-gasoline ratio for 
any compliance year is three percent or less, regardless of how the 
increase compares with the baseline ratio. Blendstock tracking would be 
required only for refiners having a 1990 baseline more stringent than 
the anti-dumping statutory baseline. These provisions were designed to 
limit the blendstock accounting provisions to those circumstances where 
there is likely to be an environmental problem. This also would help to 
avoid unnecessary costs and burdens on the regulated community. In any 
case where EPA can show that a refiner transferred blendstocks in order 
to evade a more stringent baseline, however, the special blendstock 
accounting would be required.
    The proposed regulations would require refiners to track only 
specified blendstocks that have properties that are ``dirtier'' than 
normal anti-dumping baseline properties; a list of such blendstocks was 
included. In addition, tracking would not be required under the 
proposal for petroleum products the refiner could establish are used 
for non-gasoline-blending purposes.
    EPA received substantial comments on the blendstock accounting 
mechanism included in the 1993 proposal.
    Several comments addressed the manner in which the compliance 
period blendstock-to-gasoline ratios are compared to the baseline 
ratios. Several commenters said that the blendstock-to-gasoline ratio 
for any annual averaging period should be compared to the largest 
single-year ratio during the baseline period, and not to a multi-year 
averaging period as proposed. This change is necessary, according to 
one commenter, because refinery equipment is shut-down for maintenance 
during normal refinery operations (or a refinery equipment 
``turnaround''), and that such turnarounds often will result in 
increased blendstock shipments from a refinery. An industry group 
commenter further stated that most refinery equipment goes through a 
maintenance turnaround every four years. Other commenters suggested 
that the possibility of triggers due to erratic blendstock-to-gasoline 
ratios should be solved by enlarging the ten percent ratio threshold.
    EPA agrees with the concerns raised by these comments, and has 
modified the manner in which blendstock-to-gasoline ratios are compared 
in the final rule. During 1995 through 1997, the annual compliance 
period blendstock-to-gasoline ratio is compared to the largest one-year 
ratio during the baseline period. Beginning in 1998, however, because 
of data availability due to the implementation of the reformulated 
gasoline regulations the compliance period ratio is a running average 
consisting of the average of the current year's ratio and the ratios 
from the three previous years. This four-year compliance period ratio 
is compared to the similar four-year baseline ratio. EPA believes this 
approach to evaluating blendstock-to-gasoline ratios responds to the 
concerns raised by the commenters, and will minimize if not eliminate 
the chance that the ten percent threshold will be exceeded because of 
maintenance, turnarounds and other like events that do not indicate a 
transfer of production to achieve a less stringent baseline. For 
example, any increase in blendstock sales volume during the compliance 
period that is due to refinery equipment turnaround should be matched 
by blendstock sales volume during the baseline period that also is due 
to a turnaround. Beginning in 1998 the comparison of four-year averages 
should further dampen any unusual, short-term deviations from the 
normal proportion of refinery sales that is blendstock.
    EPA believes comparing the blendstock-to-gasoline ratio of a four-
year compliance period with a four-year baseline period provides the 
best indication of a refiner's overall approach to blendstock 
production, because of its correlation with the normal period of 
refinery equipment turnarounds. During the first three years of the 
program when a four-year compliance period is not possible, however, 
the approach of comparing each compliance year's blendstock-to-gasoline 
ratio with the largest single year's ratio during the baseline period 
is the best alternative.
    EPA believes the one-year ratio comparison approach is inferior to 
the four-year ratio comparison approach as a long-term program 
mechanism, because under the one-year approach there is the potential 
for refiners to have large blendstock-to-gasoline ratios in each year 
that are not due to normal refinery operations, yet these ratios would 
be acceptable if smaller than the largest one-year ratio from the 
baseline period. The final rule nevertheless includes the one-year 
approach for 1995 through 1997, because refiners will be required to 
include 1995 through 1997 blendstock ratios in their 1998 four-year 
average ratio. Any refiner who has produced excess blendstock in order 
to ``game'' the one-year comparison approach during the first three 
program years is likely to fail the more appropriate four-year 
comparison in 1998. EPA believes the likelihood such a refiner would 
violate the ten percent threshold and incur the consequent blendstock 
accounting requirements will constrain refiner gaming of this type.
    EPA has retained the ten percent blendstock-to-gasoline ratio 
trigger in the final rule, however, because a trigger at this level is 
appropriate for the like-time-period comparisons used in the final 
rule. With the promulgated approach, EPA believes that blendstock sales 
increases in excess of the trigger are only likely to occur in cases 
where a refiner attempts to improperly gain use of a less stringent 
baseline.
    Several comments focused on the two options proposed for special 
blendstock accounting, the first option with the refiner accounting for 
the blendstock and the second option with the downstream refiner-
blender using the baseline of the blendstock producer-refiner. These 
commenters stated that refiners using the refiner-accounting option 
would have difficulty if it became apparent late in the year that the 
ratio threshold would be exceeded, because the required adjustment must 
reflect the total volume of all blendstocks produced and sold during 
the entire year. These commenters stated that the refiner-accounting 
option also would be difficult to implement because downstream refiner-
blenders of the blendstock, who would have included blendstock received 
during the year in compliance planning, would have to recalculate 
compliance with the refiner-accounted blendstock excluded. Similar 
timing and complexity concerns were expressed in the case of a refiner 
who selected the option of shifting the refiner's baseline to 
blendstock recipients.
    EPA agrees with these comments, and has modified the final rule as 
a result. In any case where the blendstock-to-gasoline threshold is 
exceeded, special blendstock accounting is required beginning in the 
subsequent averaging period. This change will avoid the timing and 
complexity problems of requiring refiners and downstream blendstock 
recipients to recalculate compliance retroactively for the compliance 
period during which the threshold is exceeded. In addition, EPA has 
rethought the option of allowing refiners to pass the refiner baseline 
to blendstock recipients, and has excluded this option from the final 
rule. EPA believes that the burden of special blendstock accounting 
should fall on the refiner that produces the excess blendstock, and 
such parties should not be allowed to pass the accounting 
responsibility to downstream parties. EPA proposed the option of 
allowing refiners to pass the refiner-baseline to downstream blender-
refiners in order to allow more flexibility in meeting the anti-dumping 
requirements. EPA now believes that this flexibility advantage is 
outweighed by countervailing considerations, including the complexity 
that results from this option, the equity in placing the blendstock 
accounting responsibility only on the refiner who has control over the 
volume of blendstocks that is produced, and the inequity that could 
result if a refiner imposed a more stringent baseline on downstream 
blender-refiners.
    One commenter expressed concern that the reason EPA proposed 
blendstock accounting measures was to prevent new blender-refiners from 
entering the market in order to correct a perceived ``loophole'' in the 
proposed rules, and that such market manipulation by EPA is 
inappropriate.
    EPA agrees that the anti-dumping program should not preclude new 
blenders from entering the market, and does not believe that the final 
regulations have such a result. Any refiner who enters the market 
beginning in 1995 will have the same regulatory requirements as 
refiners who were in business before that date. They of course will 
have the statutory baseline and not a baseline that is more stringent 
than the statutory baseline. A new refiner would therefore not be 
subject to the blendstock accounting requirements.
    EPA has implemented the following changes in the final rule in 
response to comments: (1) The gasoline portion of the compliance period 
blendstock-to-gasoline ratio has been expanded to include all gasoline 
produced, including reformulated gasoline and RBOB, because a 
comparison to conventional gasoline alone would more likely cause the 
trigger to be exceeded and not represent true incidences of dumping; 
(2) straight run naphtha has been excluded from the list of applicable 
blendstocks that are included in the blendstock portion of the 
blendstock-to-gasoline ratio, because properties of this product are 
cleaner than the anti-dumping statutory baseline; and (3) feedstocks, 
exported blendstocks, and blendstocks transferred between refineries 
that are aggregated for compliance purposes are excluded from the 
blendstock portion of the ratio, as they are not indicative of a 
transfer of production to avoid a more stringent baseline.
    EPA proposed that refiners would be exempt from special blendstock 
accounting if the compliance period blendstock-to-gasoline ratio is 
three percent or less, regardless of how this ratio compares with the 
baseline ratio. One commenter stated that EPA should either reduce the 
three percent threshold for this exemption, or eliminate the exemption 
altogether. The commenter claimed that refiners could produce primarily 
dirty blendstocks (e.g., benzene) within the three percent limit for 
sale into the downstream market, which would result in environmental 
degradation. This commenter further stated that with the three percent 
exemption, only approximately fifteen percent of refiners would be 
required to monitor the blendstock-to-gasoline ratio under EPA's 
proposed scheme. This commenter also stated that the blendstock 
tracking provisions should apply to all refiners and not only to 
parties with more-rigorous-than-statutory baselines, because all 
parties have the opportunity to sell dirty blendstocks into the 
downstream market.
    EPA disagrees with the concern raised by this comment. Any party 
who combines blendstocks to produce conventional gasoline, or who 
combines blendstocks (other than oxygenate) with conventional gasoline, 
is considered to be a ``refiner'' under the anti-dumping regulations, 
and is required to meet all anti-dumping standards and requirements. 
Moreover, such a blender-refiner is required to meet anti-dumping 
standards only on the basis of the volume and properties of the 
blendstock used, and may not include in compliance calculations the 
volume and properties of any gasoline used in blending. Any blender-
refiner must, therefore, offset any ``dirty'' blendstocks used with 
sufficient ``clean'' blendstocks to meet the anti-dumping standards on 
average. Most downstream blender-refiners will be subject to the anti-
dumping statutory baseline.
    EPA believes these requirements on blender-refiners will limit the 
opportunities for refiners to produce and sell ``dirty'' blendstocks. 
In addition, because any ``dirty'' blendstocks must be offset with 
``clean'' blendstocks the gasoline produced will cause no environmental 
degradation.
    EPA does not agree with the comment that all refiners could gain an 
advantage from shifting blendstocks regardless of their baseline. Only 
refiners with a baseline more-stringent-than-statutory could shift 
blendstocks to another refiner with the average baseline and thereby 
circumvent the anti-dumping requirements. For a refiner with a less-
stringent-than-statutory baseline, the statutory baseline is more 
stringent. As a result, blendstock shifted by such a refiner to another 
refiner with the statutory baseline would have to meet standards as 
measured against a more stringent baseline. A refiner with a less-
stringent-than-statutory baseline similarly would not be able to 
circumvent the baseline provisions merely by shifting blendstock to 
another refiner with an even less stringent individual refinery 1990 
baseline, because the volume of gasoline that may be produced against 
the individual refinery 1990 baseline is limited to the second 
refiner's 1990 equivalent gasoline volume.83 Compliance for any 
gasoline produced in excess of the 1990 equivalent gasoline volume is 
measured against the Clean Air Act statutory baseline. In consequence, 
if blendstocks are shifted by one refiner to another with a more 
lenient baseline, in effect the shifted blendstock must meet standards 
measured against the statutory baseline.
---------------------------------------------------------------------------

    \8\3The 1990 equivalent gasoline volume is a calculated volume 
that subtracts from the refiner's 1990 total gasoline volume the 
volume of reformulated gasoline produced by the refiner during the 
compliance period.
---------------------------------------------------------------------------

    As a result, EPA has not included in the final rule any provisions 
that would limit the volumes of blendstocks that are produced and sold, 
except for the provisions intended to address the baseline-shifting 
strategy.

B. Inclusion of Oxygenate in Anti-Dumping Compliance Calculations

    Oxygenates are included in the set of products that may be included 
in anti-dumping compliance calculations under certain conditions, 
because the oxygenate used in the production of conventional gasoline 
alters the results of the anti-dumping compliance calculations. As a 
result, where a refiner or importer is able to establish that oxygenate 
is in fact added to gasoline or blendstock produced or imported by that 
party, it is appropriate to allow the refiner or importer to include 
the oxygenate in compliance calculations. This approach to oxygenate 
use under anti-dumping is consistent with the proposals, but the final 
rule clarifies the manner in which parties must demonstrate that 
oxygenate is in fact used.
    In the SNPRM 92 and SNPRM 93, EPA proposed that the inclusion of 
oxygenate volume in compliance calculations by refiners and importers 
would be optional, except as required in the calculation of other 
exhaust emission products under the applicable model. These proposals 
did not, however, specify the manner in which the oxygenate use showing 
must be made. EPA believes the provisions included in the final rule 
dealing with the oxygenate use showing during compliance periods is 
necessary in order to ensure conventional gasoline emissions are 
accurately reported.84
---------------------------------------------------------------------------

    \8\4EPA proposed that any refiner or importer who elects to 
include oxygenate in its compliance calculations would be required 
to include oxygenates in its 1990 baseline as well. Under the final 
rule, however, refiners and importers are required to include 
oxygenate in anti-dumping baselines whether or not oxygenate is 
included in compliance calcuations. The baseline-setting process, 
including the treatment of oxygenate, is discussed in preamble 
section VIII.
---------------------------------------------------------------------------

    Oxygenate blenders are not required to demonstrate compliance with 
anti-dumping standards because the blending of oxygenate has only a 
positive effect on the quality of gasoline or blendstock with which 
oxygenate is blended with regard to the properties or emission products 
regulated under anti-dumping.85
---------------------------------------------------------------------------

    \8\5Under 40 CFR 80.2(ll), an oxygenate blending facility is 
``any facility (including a truck) at which oxygenate is added to 
gasoline or blendstock, and at which the quality or quantity of 
gasoline is not altered in any other manner except for the addition 
of deposit control additives.'' Under 40 CFR 80.2(mm), an oxygenate 
blender is ``any person who owns, leases, operates, controls, or 
supervises an oxygenate blending facility, or who owns or controls 
the blendstock or gasoline used or the gasoline produced at an 
oxygenate blending facility.''
    Oxygenate blenders are regulated under the anti-dumping 
provisions, inter alia, to the extent the oxygenate they blend is 
used in the compliance calculations of the refiner or importer who 
produces or imports the base gasoline used by the oxygenate blender. 
In this situation, the oxygenate blender is required, with regard to 
this oxygenate blending, to maintain records and to allow EPA 
inspections.
---------------------------------------------------------------------------

    Oxygenate that is blended at a refinery or import facility would be 
included in compliance calculations as a matter of course because the 
oxygen (along with all other gasoline constituents) would be reflected 
in the batch analyses conducted of the gasoline using samples collected 
before the gasoline left the refinery or import facility.
    The requirements that must be met in order for refiners and 
importers to be allowed to claim oxygenates which are blended 
downstream are similar to the requirements relating to reformulated 
gasoline blendstock for oxygenate blending (RBOB) in the reformulated 
gasoline program. The thrust of these requirements is that the refiner 
or importer must show that the oxygenate claimed was in fact added to 
the refiner's or importer's gasoline. This could be shown if the 
refiner or importer is able to demonstrate that it blended the 
oxygenate while the gasoline (or gasoline blendstock) is still owned by 
the refiner or importer.
    If the downstream blending is carried out by a person other than 
the refiner or importer, in order to include the oxygenate in its 
compliance calculations the refiner or importer must have a contract 
with the downstream blender which mandates procedures that are 
necessary for proper blending. In addition, the refiner or importer 
must monitor the downstream blending operation in a manner reasonably 
calculated to ensure the oxygenate use claimed by the refiner or 
importer is accurate. Such monitoring must include audits, inspections, 
and sampling and testing of gasoline produced by the downstream 
blender.
    The provisions that must be included in the contract with the 
oxygenate blender are those which the refiner or importer believes are 
necessary to ensure the oxygenate claimed by the refiner or importer is 
in fact added. At a minimum, the contract should provide for the 
inspections, sampling and testing, and audits by the refiner or 
importer over the oxygenate blending operation, as well as any quality 
assurance measures the refiner or importer feels the oxygenate blender 
should carry out. The contract also could specify the technical manner 
in which oxygenate is blended, if necessary to support the refiner's or 
importer's oxygenate use claims.
    The inspections and periodic sampling and testing oversight 
requirement is intended to ensure any oxygenate-use claims by a refiner 
or importer are supported by the actual oxygenate blending that occurs. 
The sampling and testing must be of the gasoline that is produced at 
the oxygenate blending operation, using base gasoline that was produced 
or imported by the refiner or importer. If the volume percent oxygenate 
found through sampling and testing is inconsistent with the refiner's 
or importer's claimed oxygenate volume, the refiner or importer must 
resolve the inconsistency in order to include the oxygenate in its 
compliance calculations. EPA believes the sampling and testing should 
be unannounced, should occur at different times during the portion of 
the averaging period when oxygenate is blended, and that the overall 
frequency is dependent on the situation. The sampling and testing 
should increase in frequency as the oxygenate volume increases, with 
oxygenate blenders who are less sophisticated, or where the refiner has 
any reason to question the oxygenate blending operation.
    Inspections by refiners and importers should be calculated to 
determine if the oxygenate blender is complying with the procedures 
included in the contract with the oxygenate blender, such as quality 
assurance by the blender.
    EPA believes that audits must occur at least annually, and more 
frequently if there is any reason for the refiner or importer to 
question the oxygenate blending operation. EPA further believes that 
audits must include, at a minimum, review of records that reflect the 
types and volumes of oxygenate purchased and used by the downstream 
blender to ensure they are consistent with the refiner's or importer's 
claims. In a case where the oxygenate blender is using base gasoline 
that is produced or imported by more than one refiner or importer, the 
audit must distinguish the oxygenate blended with the different 
refiner's or importer's base gasoline. In a case where the base 
gasoline is fungibly mixed with gasolines from other refiners or 
importers prior to its receipt by the downstream blender, the audit 
must account for the portion of the fungible mixture that is the 
gasoline produced by the refiner or imported by the importer.
    As a result of the complexities inherent in tracking gasoline 
through the fungible distribution system, EPA believes in most cases it 
will be impracticable for refiners or importers to effectively monitor 
downstream oxygenate blending with gasoline that is shipped fungibly, 
and as a result the refiner or importer normally would be precluded 
from including the oxygenate in compliance calculations.
    In any case where the downstream oxygenate use claims by a refiner 
or importer are not supported by the inspections, sampling and testing, 
or audits, or where EPA is able to establish that the oxygenate use 
claims by the refiner or importer are incorrect, the refiner or 
importer would not be allowed to include the oxygenate in compliance 
calculations. If the error is discovered subsequent to the conclusion 
of an averaging period, moreover, the refiner or importer would be 
required to recalculate its compliance calculations for the averaging 
period ab initio without including the oxygenate, even if this 
recalculation results in the refiner or importer being out of 
compliance with the anti-dumping standards.

C. Inclusion of Sub-Octane Blendstock in Compliance Calculations

    EPA has included conventional gasoline and gasoline 
blendstock86 that is intended for downstream oxygenate blending in 
the set of products that must be included in the compliance 
calculations of refiners and importers.
---------------------------------------------------------------------------

    \8\640 CFR 80.2(s) defines gasoline blending stock or component 
as ``any liquid compound which is blended with other liquid 
compounds or with lead additives to produce gasoline.''
---------------------------------------------------------------------------

    Most base gasoline that is used in downstream oxygenate blending 
operations meets the definition of gasoline and as a result must be 
included in refiner/importer compliance calculations without regard to 
the provisions related to blendstock.87 Base gasoline meets the 
gasoline definition where the gasoline has the properties of gasoline 
that also is sold for use without oxygenate blending. For example, one 
common practice is to blend 10 vol% ethanol with 87 octane gasoline to 
produce 89.6 octane gasoline, and 87 octane gasoline is commonly sold 
for use without oxygenate blending. 87 octane base gasoline therefore 
meets the definition of gasoline.
---------------------------------------------------------------------------

    \8\740 CFR 80.2(c) defines gasoline as ``any fuel sold in any 
State for use in motor vehicles and motor vehicle engines, and 
commonly or commercially known or sold as gasoline.'' (footnote 
omitted).
---------------------------------------------------------------------------

    Most ``sub-octane'' blendstock specifically designed for oxygenate 
blending also meets the definition of gasoline, because gasoline having 
similar properties is sold in certain regions of the country and at 
certain times of the year.88 For example, 85 octane blendstock--a 
``sub-octane'' blendstock--is sometimes produced with the intention 
that with the addition of 10 vol% ethanol this blendstock will become 
87 octane gasoline. However, because 85 octane gasoline is sold in the 
mountain states in the winter, 85 octane blendstock meets the 
definition of ``gasoline'' and is not a ``blendstock'' under the 
definition of that term even when it is blended with ethanol.
---------------------------------------------------------------------------

    \8\8For purposes of this discussion, ``sub-octane'' blendstock 
is blendstock that has an octane below 87.
---------------------------------------------------------------------------

    Potentially there are ``sub-octane'' blendstocks that become 
gasoline solely through the addition of oxygenate and that have octanes 
that are lower than the octane of any gasoline sold anywhere in the 
United States. Such a product would not meet the definition of 
gasoline, but would be a blendstock.
    EPA nevertheless believes that the refiner or importer who produces 
or imports ``sub-octane'' base gasoline product, rather than the 
oxygenate blender, should include the product in its compliance 
calculations for several reasons. First, the emissions performance of 
such products is determined primarily through its basic properties and 
not by the addition of oxygenate. Second, to the extent that a refiner 
or importer produced or imported ``sub-octane'' base gasoline in 1990, 
thus contributing to the quality of the gasoline pool in 1990, such 
product should be part of that refiner's or importer's conventional 
gasoline pool in 1995. Third, the refiner or importer of such product 
is likely to be more sophisticated than oxygenate blenders in defining 
the quality of conventional gasoline necessary to meet the requirements 
of the anti-dumping program, and in meeting the range of anti-dumping 
requirements that apply to refiners. Oxygenate blenders, who often are 
truck splash blender-distributors, are not required to meet anti-
dumping standards (for reasons discussed above), but placing the 
responsibility of accounting for ``sub-octane'' base gasoline on 
oxygenate blenders would result in these parties becoming ``refiners'' 
who are subject to the full scope of anti-dumping requirements.
    Finally, if refiners and importers who produce or import ``sub-
octane'' blendstock could avoid including this product in their 
compliance calculations, the anti-dumping enforcement requirements 
would have to be expanded to include complex (and expensive) product 
tracking and accounting mechanisms designed to ensure product of this 
type ultimately is accounted for, and is included in the compliance 
calculations of only a single party. EPA believes, therefore, that it 
is appropriate for the refiners and importers of ``sub-octane'' 
blendstocks to include such products in their compliance calculations 
under the anti-dumping program.
    This requirement for refiners and importers to include sub-octane 
``blendstock'' in compliance calculations is consistent with, but less 
far-reaching than, the proposal contained in the 1992 SNPRM that 
refiners and importers would be required to account for all blendstock 
produced or imported.

D. Compliance Calculations for Blendstock That Is Blended With Gasoline

    In the SNPRM 93, EPA proposed that parties who produce gasoline 
solely by combining different blendstocks could determine compliance on 
the basis of the properties and volumes of the blendstocks without 
performing a full analysis of the final blends. This compliance 
determination approach also was intended to apply to parties who add 
blendstocks to finished gasoline which has been included in another 
party's compliance calculations. Under this proposal, refiners and 
importers would insert the properties and values of the blendstocks 
into the equations for the complex and simple model standards. EPA now 
believes this compliance calculation approach is appropriate only for 
simple model standards, but not for complex model standards because 
blendstocks have parameters that are outside the range of the complex 
model.
    This approach is included in the final rule for refiners and 
importers subject to the simple model because a blender-refiner can 
calculate the volume-weighted averages of sulfur, T-90, olefins, and 
exhaust benzene using blendstock analyses only.
    For example, consider a blender-refiner who has the anti-dumping 
statutory baseline, which for olefins is 10.6 vol%. The simple model 
anti-dumping standard for olefins is no greater than 125% times 10.8, 
or 13.50 vol%. In this example the blender-refiner used two blendstocks 
during the averaging period, 10,000 gallons of light FCC naphtha which 
the blender-refiner sampled and tested and determined to contain 39.8 
vol% olefins. The blender-refiner also used 25,000 gallons of reformate 
that through the blender-refiner's sampling and testing was determined 
to contain 1.0 vol% olefins. The blender-refiner in this example 
determined the annual average olefin content of its blendstock by 
calculating the volume-weighted average olefin content of these two 
blendstocks, or (10,000 * 39.8) plus (25,000 * 1.0) divided by 35,000, 
or 11.8 vol% olefins. Because 11.8 vol% is less than the 13.25 vol% 
olefin standard, the blender-refiner in this example would meet the 
anti-dumping olefin standard. Annual averages for the blender-refiner 
for sulfur, T-90, and exhaust benzene under the simple model would be 
calculated in a similar manner.
    EPA believes that compliance with complex model standards cannot be 
determined using the volume-weighted properties of blendstock as 
described above, because such an approach would not provide meaningful 
results for exhaust benzene, or toxics or NOX emissions 
performance. EPA has, however, included a method in the final rule for 
calculating compliance under the complex model in the case of 
blendstock that is added to gasoline whereby compliance is determined 
on the basis of blendstocks blended with gasoline. This results in a 
calculation method that is consistent with the technical limitations 
inherent with the complex model.
    Under this calculation method, the blender-refiner determines the 
fuel parameters of the blendstock or blendstocks that are to be added 
to a base gasoline, by testing a representative sample of each 
blendstock. The blender-refiner then calculates the properties of the 
gasoline that would result if the blendstock or blendstocks were 
blended, in the volume-ratio used in the blending operation, with a 
gasoline having parameters that are equal to anti-dumping baseline 
applicable to the blender-refiner, except that properties measured on a 
weight or ppm basis, such as sulfur, must be corrected for the specific 
gravities of the products blended. In most cases, the anti-dumping 
statutory baseline would be the applicable baseline for blender-
refiners. This mathematical calculation thus models the fuel parameters 
of the gasoline that would result if the blendstock in question were in 
fact blended with gasoline having properties equal to the blender-
refiner's baseline in the volume-ratio used in the blending operation. 
The emissions performance (exhaust benzene, or toxics or NOX 
emissions performance) of the mathematically-created gasoline is 
determined through the appropriate complex model, as is the emissions 
performance of the blender-refiner's baseline gasoline. The emissions 
performance effect of the blendstock is calculated by subtracting the 
emissions performance of the blender-refiner's baseline gasoline from 
the emissions performance of the mathematically-calculated gasoline. 
The anti-dumping standard is met if the volume-weighted emissions 
performance for all blendstock used in blends during the averaging 
period is equal to or less than zero.
    For example, consider a blender-refiner who has the anti-dumping 
statutory baseline, and who is subject to the complex model standards 
(toxics and NOX emissions performance). This blender-refiner uses 
two blendstocks during a certain portion of the averaging period, a 
light FCC naphtha and a reformate, and these blendstocks are blended at 
the rate of 10 vol% FCC naphtha, 25 vol% reformate, and 65 vol% base 
gasoline. A partial list of the properties of these blendstocks, as 
determined by the blender-refiner through sampling and testing, are as 
follows: 

                                                                        
------------------------------------------------------------------------
                                                                 Anti-  
                                          FCC                   dumping 
                                        naphtha    Reformate   statutory
                                                               gasoline 
------------------------------------------------------------------------
Aromatics (vol%)....................      13.5        31.1        28.6  
Olefins (vol%)......................      39.8         1.0        10.8  
Sulfur (ppm)........................     289          10         338    
Specific gravity....................       0.753       0.801       0.742
------------------------------------------------------------------------

    The blender-refiner determines the properties of the blends that 
would result if these blendstocks were blended at these rates with 
gasoline having properties equal to the anti-dumping statutory 
baseline. In the case of aromatics, the calculation would be the 
following:

aromatics (vol%)=(13.5 x 0.10)+31.1 x 0.25)+(28.6 x 0.65)=27.72

    As stated earlier, fuel properties measured on a weight percent or 
ppm basis would have to be adjusted for specific gravity as follows:

TR16FE94.000

    All other parameters required for the complex model would be 
calculated in a similar manner to create a list of calculated 
parameters except for the determination of RVP for ethanol blends. 
Because of the high RVP of ethanol and its non-linear blending 
characteristics, gasoline blends with at least 1.50% ethanol by volume 
should be entered into the appropriate complex model with an assumed 
RVP 1.0 psi greater than that of the base gasoline and other 
blendstocks. Below 1.50% ethanol concentration, the RVP of the base 
gasoline and blendstock should be unchanged for calculation purposes in 
the complex model. These parameters are then applied to the complex 
model to generate the values of the exhaust benzene, toxics and 
NOX emissions performance for the hypothetical calculated blend. 
In this example, the complex model yields a NOX emissions 
performance for this gasoline of 640 mg/mile.
    The properties of the anti-dumping statutory gasoline are then 
applied to the complex model to determine that this gasoline has a 
NOX emissions performance of 660 mg/mile. The blender-refiner in 
this example then subtracts the NOX emissions performance of anti-
dumping statutory gasoline from the NOX emissions performance of 
the hypothetical calculated blend, to yield the NOX emissions 
performance effect of the blendstocks used of -20 mg/mile (640-660=-20 
mg/mile).
    The blender-refiner would then repeat this process for all blends 
produced during the averaging period where blendstock was added to base 
gasoline. These per-batch NOX emissions performance effects are 
then combined on a volume-weighted basis, and the blender-refiner would 
have met the NOX anti-dumping standard if this net value is equal 
to or less than zero. A similar analysis was performed for toxics 
emissions performance.

X. Provisions for Opt-in by Other Ozone Non-Attainment Areas

    Section 211(k)(6) of the Act allows certain areas to opt into the 
reformulated gasoline (RFG) program. Thus, such areas may choose to 
participate in the RFG program, unlike the nine areas with the highest 
ozone design values which are required to participate.
    The following is a list of all areas either required to be covered 
by the reformulated gasoline program or which have opted into the 
program to date:

Connecticut--Entire State

Areas Classified as Severe Ozone Nonattainment Areas

1. Fairfield County (part)
2. Litchfield County (part)

Areas Classified as Serious Ozone Nonattainment Areas

1. Fairfield County (part)
2. Hartford County
3. Litchfield County (part)
4. Middlesex County
5. New Haven County
6. New London County
7. Tolland County
8. Windham County

Delaware

Areas Classified as Severe Ozone Nonattainment Areas

1. Kent County
2. New Castle County

Areas Classified as Marginal Ozone Nonattainment Areas

1. Sussex County

District of Columbia

Areas Classified as Serious Ozone Nonattainment Areas

1. Washington (entire area)

Kentucky

Areas Classified as Moderate Ozone Nonattainment Areas

1. Boone County
2. Bullitt County (part)
3. Campbell County
4. Jefferson County
5. Kenton County
6. Oldham County (part)

Maine

Areas Classified as Moderate Ozone Nonattainment Areas

1. Androscoggin County
2. Cumberland County
3. Kennebec County
4. Knox County
5. Lincoln County
6. Sagadahoc County
7. York County

Areas Classified as Marginal Ozone Nonattainment Areas

1. Hancock County
2. Waldo County

Maryland

Areas Classified as Severe Ozone Nonattainment Areas

1. Anne Arundel County
2. Baltimore County
3. Carroll County
4. Cecil County
5. Harford County
6. Howard County

Areas Classified as Serious Ozone Nonattainment Areas

1. Calvert County
2. Charles County
3. Frederick County
4. Montgomery County
5. Prince Georges County

Areas Classified as Marginal Ozone Nonattainment Areas

1. Kent County
2. Queen Annes County

Massachusetts--Entire State

Areas Classified as Serious Ozone Nonattainment Areas

1. Barnstable County
2. Berkshire County
3. Bristol County
4. Dukes County
5. Essex County
6. Franklin County
7. Hampden County
8. Hampshire County
9. Middlesex County
10. Nantucket County
11. Norfolk County
12. Plymouth County
13. Suffolk County
14. Worcester County

New Hampshire

Areas Classified as Serious Ozone Nonattainment Areas

1. Hillsborough County (part)89
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    \8\9Part of Hillsborough County is classified as serious, the 
other part as marginal.
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2. Rockingham County (part)90
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    \9\0Part of Rockingham County is classified as serious, the 
other part as marginal.
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3. Strafford County

Areas Classified as Marginal Ozone Nonattainment Areas

1. Hillsborough County (part)
2. Merrimack County
3. Rockingham County (part)

New Jersey

Areas Classified as Severe Ozone Nonattainment Areas

1. Bergen County
2. Burlington County
3. Camden County
4. Cumberland County
5. Essex County
6. Gloucester County
7. Hudson County
8. Hunterdon County
9. Mercer County
10. Middlesex County
11. Monmouth County
12. Morris County
13. Ocean County
14. Passaic County
15. Salem County
16. Somerset County
17. Sussex County
18. Union County

Areas Classified as Moderate Ozone Nonattainment Areas

1. Atlantic County
2. Cape May County

Areas Classified as Marginal Ozone Nonattainment Areas

1. Warren County

New York

Areas Classified as Severe Nonattainment Areas

1. Bronx County91
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    \9\1The state requested time to study the boundaries and 
classification under Section 107(d)(4)(A)(iv). The boundaries and 
classification of Orange and Putnam Counties will be determined 
based upon evaluation of that study by EPA.
---------------------------------------------------------------------------

2. Kings County
3. Nassau County
4. New York County
5. Queens County
6. Richmond County
7. Rockland County
8. Suffolk County
9. Westchester County

Areas Classified as Marginal Nonattainment Areas

1. Albany County
2. Dutchess County
3. Erie County
4. Essex County92
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    \9\2This area is a rural transport area.
---------------------------------------------------------------------------

5. Greene County
6. Jefferson County
7. Montgomery County
8. Niagara County
9. Rensselaer County
10. Saratoga County
11. Schenectady County

Pennsylvania

Areas Classified as Severe Ozone Nonattainment Areas

1. Bucks County93
---------------------------------------------------------------------------

    \9\3These counties are already defined as ``covered areas'' and 
are subjected to the federal reformulated fuel program under Section 
211(k)(10)(D).
---------------------------------------------------------------------------

2. Chester County
3. Delaware County
4. Montgomery County
5. Philadelphia County

Areas Classified as Moderate Ozone Nonattainment Areas

1. Allegheny County
2. Armstrong County
3. Beaver County
4. Berks County
5. Butler County
6. Fayette County
7. Washington County
8. Westmoreland County

Areas Classified as Marginal Ozone Nonattainment Areas

1. Adams County
2. Blair County
3. Cambria County
4. Carbon County
5. Columbia County
6. Cumberland County
7. Dauphin County
8. Erie County
9. Lackawanna County
10. Lancaster County
11. Lebanon County
12. Lehigh County
13. Luzerne County
14. Mercer County
15. Monroe County
16. Northampton County
17. Perry County
18. Somerset County
19. Wyoming County
20. York County

Rhode Island--Entire State

Areas Classified as Serious Ozone Nonattainment Areas

1. Bristol County
2. Kent County
3. Newport County
4. Providence County
5. Washington County

Texas--Houston/Galveston area

Area Classified As Moderate Ozone Nonattainment Area

1. Collin County
2. Dallas County
3. Denton County
4. Tarrant County

Virginia

Areas Classified as Serious Ozone Nonattainment Areas

1. Alexandria
2. Arlington County
3. Fairfax
4. Fairfax County
5. Falls Church
6. Loudoun County
7. Manassas
8. Manassas Park
9. Prince William County
10. Stafford County

Areas Classified as Moderate Ozone Nonattainment Areas

1. Charles City County
2. Chesterfield County
3. Colonial Heights
4. Hanover County
5. Henrico County
6. Hopewell
7. Richmond County

Areas Classified as Marginal Ozone Nonattainment Areas

1. Chesapeake
2. Hampton
3. James City County
4. Newport News
5. Norfolk
6. Poquoson
7. Portsmouth
8. Smyth County (part)94
---------------------------------------------------------------------------

    \9\4This is a rural transport area.
---------------------------------------------------------------------------

9. Suffolk
10. Virginia Beach
11. Williamsburg
12. York County

    Vermont and portions of other areas in Pennsylvania and New 
Hampshire have formally requested to opt-in to the reformulated 
gasoline program, although the designated areas in these states are 
categorized as unclassified/attainment. Because of statutory 
limitations, attainment areas will not be allowed to opt-in to the 
program, with a limited exception given to some areas in established 
ozone transport regions as authorized by section 184 of the Act. The 
reader is referred to the RIA for further discussion of the statutory 
limitations.
    Other ozone nonattainment areas that are not listed herein may also 
opt-in to the reformulated gasoline program as permitted by section 
211(k)(6), under constraints such as sufficient lead-time domestic fuel 
availability.
    Several key issues were brought to EPA's attention in the form of 
comments, and EPA's response is summarized below. More detailed 
discussion of these opt-in issues can be found in Section IX of the 
Final Regulatory Impact Analysis (RIA).
    Several commenter inquiries pertained to opting out of the 
reformulated gasoline program. Once an area has opted into the 
reformulated gasoline program, the issue arises whether it may, at a 
later date, decide to opt out of the program. While EPA is currently 
considering opt-out provisions, section 211(k) does not give EPA the 
authority to develop an opt-out procedure. Thus, EPA is not including 
any opt-out provisions in this rulemaking, but may pursue a separate 
action in the future that would allow states to opt-out of the RFG 
program, provided sufficient notice is given.
    In its April 1993 NPRM, EPA requested comment on whether to permit 
areas to opt-in to only Phase I (1995-99) of the RFG program, and not 
require them to receive Phase II RFG starting in 2000. Several 
commenters supported allowing states to opt-in to Phase I only, but 
cited a number of concerns regarding the logistics of producing and 
distributing Phase I and Phase II reformulated gasolines concurrently. 
Because of these potential fuel proliferation problems (i.e., many 
types of fuels available or required in the marketplace at one time), 
as well as enforcement problems and weak statutory authority (which is 
discussed further in the RIA), EPA will not allow nonattainment areas 
to opt-in to only Phase I. Opt-in areas must be willing to commit to 
the change to Phase II RFG in the year 2000. As discussed above, EPA 
may undertake a separate action which would give opted-in areas the 
opportunity to opt-out of the RFG program. In this case if a state 
desired to maintain the Phase I RFG standards beyond the year 1999, the 
state could promulgate its own regulations requiring this. Such a 
program would have to be enforced by the state, however, and would also 
have to be approved by EPA as part of the State Implementation Plan 
review process.
    As discussed briefly above, some of the comments received by EPA 
included a request that attainment areas be permitted to opt-in to the 
RFG program. The Act does not allow participation by attainment areas 
into the reformulated gasoline program.
    EPA also received suggestions that it modify the opt-in application 
procedure to allow more lead time for refiners. EPA feels that its 
existing application procedure for opt-in and its lead time provisions 
are adequate, and do not require revision.
    Finally, one commenter suggested that opt-in should be allowed only 
after a nonattainment area has adopted Stage II controls and enhanced 
inspection and maintenance. EPA favors giving eligible areas freedom to 
opt-in to the RFG provisions, and will not require that areas first 
implement Stage II controls and enhanced inspection and maintenance.
    The NOX standard for Phase II reformulated gasoline (see 
Section VI above) will be required in all current and future opt-in 
areas. As discussed in the Section VI of the RIA, NOX control is 
believed to be necessary to ensure that all opt-in areas realize a 
reduction in ozone levels. Since future opt-in areas are likely to be 
similar to some current reformulated gasoline areas (including current 
opt-in) in terms of geographical location, meteorological conditions, 
and other factors affecting ozone formation, it is reasonable to assume 
that future opt-in areas will similarly benefit from NOX control. 
Furthermore, as discussed in Section VI of the RIA, applying the 
NOX standard to the same areas as the reformulated gasoline 
standard is considered to be the most appropriate and cost effective 
manner in which to achieve ozone benefits through fuel reformulation. 
Since refiners will already be producing reformulated gasoline 
controlling both VOC and NOX, the addition of new areas to the 
reformulated gasoline program will only require an increase in the 
volume of RFG produced and will not pose any leadtime problems.

XI. Federal Preemption

    Whenever the federal government regulates in an area, the issue of 
preemption of State action in the same area is raised. The regulations 
proposed here will affect virtually all of the gasoline sold in the 
United States. As opposed to commodities that are produced and sold in 
the same area of the country, gasoline produced in one area is often 
distributed to other areas. The national scope of gasoline production 
and distribution suggests that federal rules should preempt State 
action to avoid an inefficient patchwork of potentially conflicting 
regulations. Indeed, Congress provided in the 1977 Amendments to the 
Clean Air Act that federal fuels regulations preempt non-identical 
State controls except under certain specified circumstances (see, 
section 211(c)(4) of the Clean Air Act). EPA believes that the same 
approach to federal preemption is desirable for the reformulated 
gasoline and anti-dumping programs. EPA, therefore, is issuing today's 
final rule under the authority of sections 211 (k) and (c), and 
promulgate under section 211(c)(4) that dissimilar State controls be 
preempted unless either of the exceptions to federal preemption 
specified by section 211(c)(4) applies. Those exceptions are sections 
211(c)(4) (B) and (C).
    As raised in some of comments received by the Agency, the 
Regulatory Negotiation agreement was not intended to modify the 
provisions of section 211(c)(4)(B). Under this provision, once the 
State of California has received a waiver under section 209(b) of the 
Clean Air Act, it has the ability to regulate fuels and fuel additives 
without the need for a waiver under section 211 of the Clean Air Act. 
In accordance with the intent of Congress in enacting sections 209(b) 
and 211(c)(4)(B) of the Clean Air Act, California has used, and EPA 
understands will continue to use, these provisions to design a program 
to meet its unique needs.
    EPA believes that the limited federal preemption promulgated here 
appropriately balances the utility and efficacy of uniform national 
rules with States' needs to address their unique pollution problems.

XII. Environmental and Economic Impacts

A. Environmental Impact

    Section 211(k) of the Clean Air Act indicates that the primary 
purposes of reformulated gasoline are to reduce ozone-forming VOC 
emissions during the high ozone season and emissions of toxic air 
pollutants during the entire year. Reductions in VOCs are 
environmentally significant because of the associated reductions in 
ozone formation and in secondary formation of particulate matter, with 
the associated improvements in human health and welfare. Reductions in 
emissions of toxic air pollutants are environmentally important because 
they carry significant benefits for human health and welfare primarily 
by reducing the number of cancer cases each year.
1. Phase I Reformulated Gasoline
    Beginning in 1995, reformulated gasoline certified during Phase I 
of the program must achieve a nominal emissions reduction of 15 percent 
for VOCs, 16.5 percent for air toxics on average, and NOX 
emissions are not allowed to increase beyond levels evident in baseline 
gasoline. EPA expects simple model fuels to meet these Clean Air Act 
standards. As discussed in the section IV, high ozone season fuels 
certified using the complex model during Phase I of the reformulated 
gasoline program in VOC control region I must provide a VOC emission 
reduction from baseline levels of 36.6 percent when complying on 
average and 35.1 percent when complying on a per-gallon basis. 
Similarly, high ozone season fuels certified using the complex model 
during Phase I in VOC Control Region 2 must provide a VOC emission 
reduction from baseline levels of 17.1 percent when complying on 
average and 15.6 percent when complying on a per-gallon basis.
    The Agency projects that VOC emission reductions for Phase I of 
reformulated gasoline will be approximately 90-140 thousand tons during 
the summer period for the ``nine cities'' and the other areas that have 
currently opted into the program. Assuming a one year exposure to both 
the baseline and controlled level of toxic emissions, the number of 
cancer incidences is estimated to decrease by approximately 16 
(assuming enhanced I/M in place) or 24 (assuming basic I/M in place) 
incidences per each year that the program is in place, in the nine 
cities and the opt-in areas (refer to section V of the RIA for an 
explanation and methodology of these numbers). These reductions will 
naturally increase to the extent that other areas opt into the program.
2. Phase II Reformulated Gasoline
    Beginning in the year 2000, reformulated gasoline certified on 
average must meet a VOC emission reduction standard of 27.4 percent in 
VOC control region 2 and 29.0 percent in VOC control region 1, as well 
as a toxic emission reduction standard on average of 21.5 percent. In 
addition, a NOX emission reduction standard of 6.8 percent on 
average is required for Phase II of reformulated gasoline. The Agency 
projects that under Phase II, there will be 3-4 fewer incidences of 
cancer per year, summertime VOC emissions will be reduced by 
approximately 42,000 tons, and summertime NOX emissions will be 
reduced by approximately 22,000 tons in the nine cities and other areas 
currently opted into the RFG program (incremental to Phase I).

B. Economic Impact

1. Phase I Reformulated Gasoline
    Due to the required addition of oxygenates to gasoline and to 
refinery processing changes that will be needed to reduce fuel benzene 
and RVP levels and to meet the VOC, NOX and toxic emission 
standards, the cost of producing reformulated gasoline certified under 
Phase I, is expected to increase by approximately 3-5 cents per gallon 
in 1995 above the cost of conventional gasoline. We project annual 
costs of $700 to $940 million for both those areas mandated to be part 
of the program and those that have chosen to opt-in. Additionally, 
there will be costs due to testing, enforcement and recordkeeping.
2. Phase II Reformulated Gasoline
    As discussed in Section VI, The overall cost of the Phase II 
reformulated gasoline VOC standards and NOX standards for Phase II 
RFG is approximately 1.2 cents per gallon (incremental to Phase I RFG) 
during the VOC control period when the more stringent VOC and NOX 
standards are in effect. There should be no additional cost during the 
non-VOC control period, since only the toxics standard changes, and 
there is not expected to be a cost for year-round toxics control above 
that required for Phase I RFG. In addition, EPA does not expect non-
production related costs, such as distribution costs, recordkeeping and 
reporting costs, etc., to increase significantly relative to Phase I 
reformulated gasoline.
    The environmental and economic impacts of the reformulated gasoline 
program are described in more detail in the Section V and VI of the 
Final Regulatory Impact Analysis.

XIII. Public Participation

    During the reformulated gasoline rulemaking, EPA encouraged and 
welcomed full public participation in arriving at its final decisions 
and developing its final rule. EPA met with representatives of the 
automobile, petroleum, and oxygenate industries as well as 
environmental and citizen organizations. Their concerns and ideas were 
considered in the development in this final rule for reformulated 
gasoline. Public workshops to discuss and resolve a variety of issues 
on several aspects of the reformulated gasoline program were sponsored 
by the Agency.
    Additionally, EPA solicited, reviewed, and considered written 
comments on all aspects of its three previous proposals and Phase II 
correction notice. All comments received by the Agency are located in 
the EPA Air Docket, Dockets A-91-02 and A-92-12 (See ADDRESSES). As 
mentioned above, all significant comments were used to revise the 
previous proposals and/or are responded to in the Regulatory Impact 
Analysis contained in Docket A-91-02.

XIV. Compliance With the Regulatory Flexibility Act

    The Regulatory Flexibility Act (RFA) of 1980 requires federal 
agencies to examine the effects of the reformulated gasoline regulation 
and to identify significant adverse impacts of federal regulations on a 
substantial number of small entities. Because the RFA does not provide 
concrete definitions of ``small entity,'' ``significant impact,'' or 
``substantial number,'' EPA has established guidelines setting the 
standards to be used in evaluating impacts on small businesses95. 
For purposes of the reformulated gasoline regulations, a small entity 
is any business which is independently owned and operated and not 
dominant in its field as defined by SBA regulations under section 3 of 
the Small Business Act.
---------------------------------------------------------------------------

    \9\5U.S. Environmental Protection Agency, Memorandum to 
Assistant Administrators, ``Compliance With the Regulatory 
Flexibility Act,'' EPA Office of Policy, Planning, and Evaluation, 
1984. In addition, U.S. Environmental Protection Agency, Memorandum 
to Assistant Administrators, ``Agency's Revised Guidelines for 
Implementing the Regulatory Flexibility Act,'' Office of Policy, 
Planning, and Evaluation, 1992.
---------------------------------------------------------------------------

    The Agency has found that the reformulated gasoline and anti-
dumping regulations may possibly have some economic impact on a 
substantial number of small refiners. However, these regulations may 
not significantly affect gasoline blenders, terminal operators, service 
stations and ethanol blenders under the same EPA criteria. Small 
business entities are not required by the Clean Air Act to manufacture 
reformulated gasoline. Since most small refiners are located in the 
mountain states or in California, which has its own (more stringent) 
reformulated gasoline program, the vast majority of small refiners are 
unaffected by the federal reformulated gasoline requirements. 
Furthermore, all businesses (both large and small) maintain the option 
to produce conventional gasoline to be sold in areas not obligated by 
the Act to receive reformulated gasoline or those areas which have not 
chosen to opt into the program.
    All refiners will be affected by the anti-dumping requirements, 
which are less stringent than those for the reformulated gasoline 
portion of the program. The anti-dumping regulations affecting 
conventional gasoline are not expected to disproportionately impact 
small refiners of conventional gasoline.
    In addition, all refiners have the option to use either the simple 
or complex model during the first years of the reformulated gasoline 
program. Refiners have greater flexibility under the complex model than 
under the simple model (which focuses primarily on volatility control) 
in choosing the least-cost method of compliance.
    The component of the reformulated gasoline program most likely to 
unfavorably impact small entities is the fundamental necessity that 
reformulated gasoline meet more stringent emission standards and thus 
processing requirements. The Agency is unaware of any alternative 
options which might relieve the regulatory burden on small entities 
while simultaneously maintaining the program benefits required by the 
statute. Exempting small refiners from the reformulated gasoline 
regulations would result in the failure of meeting CAA performance 
standards, which is illegal. All reformulated gasoline is required to 
meet the same performance and compositional standards. Additionally, 
enforcement of a reformulated gasoline program (with exemptions or less 
stringent standards for some fuel producers), in-use, would be 
virtually impossible to enforce due to the inherent nature of the 
fungible gasoline distribution system in existence.
    Despite the inability to exempt small businesses from the 
requirements of the reformulated gasoline program, EPA has made 
accommodations where possible. One example of the versatility embedded 
in the reformulated gasoline regulations, by EPA, is the flexibility 
available to all refiners, both small and large, to choose to have one 
or more individual refinery conventional gasoline compliance baselines 
and one or more ``refiner'' baselines (i.e., more than one grouping of 
two or more refineries to form a compliance baseline). Another example 
of the flexibility of the regulations is the ability to produce 
reformulated gasoline on a per gallon or averaging basis. Also, certain 
small refiners who produced JP-4 jet fuel in 1990 may be able to adjust 
their baselines so as to reduce the compliance burden. It is worthy to 
note that although EPA has received several comments which claim that 
the reformulated gasoline regulations will result in closing the small 
business entities affected by this rule, convincing evidence supporting 
this claim has not been submitted.
    In accordance with section 604 of the Regulatory Flexibility Act, 
EPA has prepared a regulatory flexibility analysis which includes a 
comprehensive justification for the determination briefly reviewed 
above, as well as a summary and assessment of the issues raised by 
public comments on the Initial Regulatory Flexibility Analysis. The 
complete analysis is contained within the Regulatory Impact Analysis 
which has been placed in the docket for this rulemaking: EPA Air Docket 
A-92-12.

XV. Statutory Authority

    The statutory authority for the rules finalized today is granted to 
EPA by sections 114, 211 (c) and (k) and 301 of the Clean Air Act, as 
amended, 42 U.S.C. 7414, 7545 (c) and (k), and 7601.

XVI. Administrative Designation and Regulatory Analysis

    Pursuant to Executive Order 12866, (58 FR 51735 (October 4, 1993)) 
the Agency must determine whether the regulatory action is 
``significant'' and therefore subject to OMB review and the 
requirements of the Executive Order. The Order defines ``significant 
regulatory action'' as one that is likely to result in a rule that may:

    (1) Have an annual effect on the economy of $100 million or more 
or adversely affect in a material way the economy, a sector of the 
economy, productivity, competition, jobs, the environment, public 
health or safety, or State, local, or tribal governments or 
communitites;
    (2) Create a serious inconsistency or otherwise interfere with 
an action taken or planned by another agency;
    (3) Materially alter the budgetary impact of entitlements, 
grants, user fees, or loan programs or the rights and obligations of 
recipients thereof; or
    (4) Raise novel legal or policy issues arising out of legal 
mandates, the President's priorities, or the principles set forth in 
the Executive Order.

    Pursuant to the terms of Executive Order 12866, it has been 
determined that this rule is a ``significant regulatory action'' 
because the Administrator has determined that reformulated gasoline 
will cost well in excess of $100 million per year and therefore should 
be classified as a significant regulatory action. As such, this action 
was submitted to OMB for review. Changes made in response to OMB 
suggestions or recommendations will be documented in the public record: 
EPA Air Docket A-92-12.
    A Regulatory Impact Analysis (RIA) for the reformulated gasoline 
program has been prepared and placed in Public Docket No. A-92-12 to 
accompany this EPA notice of final rulemaking. A draft version of the 
Regulatory Impact Analysis was submitted to the Office of Management 
and Budget (OMB) for review as required by Executive Order 12866. 
Written comments from OMB and EPA response to those comments have also 
been placed in the public docket for this rulemaking. EPA has made 
subsequent updates and revisions to the draft version pertinent to the 
use of the simple model. A final version of the analysis is available 
in the docket cited above.

XVII. Compliance With the Paperwork Reduction Act

    The information collection requirements in this rule have been 
submitted for approval to the Office of Management and Budget (OMB) 
under the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. An 
Information Collection Request document has been prepared by EPA (ICR 
No.1591.03) and a copy may be obtained from Sandy Farmer, Information 
Policy Branch; EPA, 401 M Street, SW. (Mail Code 2136); Washington, DC 
20460 or by calling (202) 260-2740. These requirements are not 
effective until OMB approves them and a technical amendment to that 
effect is published in the Federal Register.
    This collection of information has an estimated reporting burden 
averaging 8 hours per response and an estimated annual recordkeeping 
burden averaging 38 hours per respondent. These estimates include time 
for reviewing instructions, searching existing data sources, gathering 
and maintaining the data needed, and completing and reviewing the 
collection of information.
    Send comments regarding the burden estimate or any other aspect of 
this collection of information, including suggestions for reducing this 
burden to Chief, Information Policy Branch; EPA; 401 M St., SW. (Mail 
Code 2136); Washington, DC 20460; and to the Office of Information and 
Regulatory Affairs, Office of Management and Budget, Washington, DC 
20503, marked ``Attention: Desk Officer for EPA.''

XVIII. Notice Regarding Registration of Reformulated Gasolines

    EPA is in the process of establishing new requirements for the 
registration of motor vehicle fuels and fuel additives (F/FAs) as 
authorized by sections 211(b) and 211(e) of the Clean Air Act 
(CAA).96 A proposal was published on April 15, 1992 (57 FR 13168). 
Pursuant to court order, EPA is scheduled to issue the final rule on or 
before April 29, 1994. The new registration regulations would 
supplement existing requirements and would apply to all F/FAs 
designated for registration, including reformulated gasoline and 
oxygenated gasolines. This new rule would require manufacturers of 
designated F/FAs to conduct certain tests and submit information 
regarding the composition and the potential health and welfare effects 
of the emissions produced by such F/FAs. Consistent with statutory 
requirements, for products registered prior to the promulgation of the 
F/FA final rule the proposal would allow a period of three years for 
the submission of certain data required by the rule. Under this 
proposal, manufacturers of designated F/FAs not registered prior to the 
promulgation of the F/FA final rule would be required to submit the 
requisite information prior to registration. This would mean that 
products not registered at the time of promulgation of the final F/FA 
testing rule would not be allowed to be registered and sold until EPA 
receives the requisite health effects information. In view of this 
proposed provision, EPA is advising manufacturers of reformulated 
gasoline and oxygenated gasolines to promptly register their products 
(or update their current gasoline registrations) so they can enter the 
marketplace and make use of the three-year time window allowed by the 
statute to conduct the required tests. The purpose of this section is 
to provide some guidance to fuel producers on the registration process.
---------------------------------------------------------------------------

    \9\6Under section 211(a) registration of designated fuels and 
fuel additives is required as a precondition to introduction into 
the marketplace.
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    To make the registration process more flexible and convenient, 
current registration procedures allow a fuel producer to include in the 
original registration a list of additives that might be used in the 
marketed fuel, along with the applicable range of concentration-in-use 
for each alternative. Manufacturers are also allowed to revise existing 
fuel registrations to accommodate expected changes in their 
formulations. These provisions allow fuel producers to respond quickly 
to fluctuations in price, availability, and other market or technical 
factors when they formulate their fuel products.
    Consistent with this current practice, EPA will permit fuel 
producers to register their oxygenated gasoline formulations (including 
reformulated gasoline) by simply revising their existing gasoline 
registrations to include the pertinent oxygenating compound(s). Fuel 
producers who are uncertain about their future fuel formulations could 
potentially list an unlimited number of oxygenates which they might, 
under some conceivable circumstances, blend into gasoline. However, EPA 
would generally advise against the strategy of including every possible 
alternative oxygenate. The fact that, for the sake of convenience, 
registrations are permitted to be modified to cover oxygenated 
gasolines does not mean that all potential formulations which fit under 
this broad compositional umbrella will necessarily be considered 
equivalent to a single fuel product. In fact, the F/FA final rule is 
expected to consider each gasoline/oxygenate blend as a different 
formulation. Thus, fuel producers would be responsible for the testing 
of each gasoline/oxygenate blend covered by the respective fuel 
registration. Furthermore, oxygenated compounds that are listed but not 
tested within the allotted time period (i.e., three years) could not be 
used by the manufacturer. Thus, in determining which oxygenate 
compounds to include in the registration, each producer should 
carefully consider the tradeoff between the additional flexibility 
which a comprehensive list of potential oxygenates might provide and 
the additional testing responsibility which might result.
    For more information about registration procedures, please contact 
the registration office at (202) 233-9755. For information on the 
testing requirements of the F/FA rule contact Ines Figueroa at (313) 
668-4575.

List of Subjects in 40 CFR Part 80

    Environmental protection, Fuel additives, Gasoline, Incorporation 
by reference, Motor vehicle pollution, Penalties, Reporting and 
recordkeeping requirements.

    Dated: December 15, 1993.
Carol M. Browner,
Administrator.

    For the reasons set forth in the preamble, part 80 of title 40 of 
the Code of Federal Regulations is amended as follows:

PART 80--REGULATION OF FUELS AND FUEL ADDITIVES

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

    Authority: Sections 114, 211 and 301(a) of the Clean Air Act as 
amended (42 U.S.C. 7414, 7545, and 7601(a)).

    2. Section 80.2 is amended by adding paragraphs (ee), (ff), (gg), 
(hh), (ii), (jj), (kk), (ll), (mm), and (nn) to read as follows:


Sec. 80.2  Definitions.

* * * * *
    (ee) Reformulated gasoline means any gasoline whose formulation has 
been certified under Sec. 80.40, which meets each of the standards and 
requirements prescribed under Sec. 80.41, and which contains less than 
the maximum concentration of the marker specified in Sec. 80.82 that is 
allowed for reformulated gasoline under Sec. 80.82.
    (ff) Conventional gasoline means any gasoline which has not been 
certified under Sec. 80.40.
    (gg) Batch of reformulated gasoline means a quantity of 
reformulated gasoline which is homogeneous with regard to those 
properties which are specified for reformulated gasoline certification.
    (hh) Covered area means each of the geographic areas specified in 
Sec. 80.70 in which only reformulated gasoline may be sold or dispensed 
to ultimate consumers.
    (ii) Reformulated gasoline credit means the unit of measure for the 
paper transfer of oxygen or benzene content resulting from reformulated 
gasoline which contains more than 2.1 weight percent of oxygen or less 
than 0.95 volume percent benzene.
    (jj) Oxygenate means any substance which, when added to gasoline, 
increases the oxygen content of that gasoline. Lawful use of any of the 
substances or any combination of these substances requires that they be 
``substantially similar'' under section 211(f)(1) of the Clean Air Act, 
or be permitted under a waiver granted by the Administrator under the 
authority of section 211(f)(4) of the Clean Air Act.
    (kk) Reformulated gasoline blendstock for oxygenate blending, or 
RBOB means a petroleum product which, when blended with a specified 
type and percentage of oxygenate, meets the definition of reformulated 
gasoline, and to which the specified type and percentage of oxygenate 
is added other than by the refiner or importer of the RBOB at the 
refinery or import facility where the RBOB is produced or imported.
    (ll) Oxygenate blending facility means any facility (including a 
truck) at which oxygenate is added to gasoline or blendstock, and at 
which the quality or quantity of gasoline is not altered in any other 
manner except for the addition of deposit control additives.
    (mm) Oxygenate blender means any person who owns, leases, operates, 
controls, or supervises an oxygenate blending facility, or who owns or 
controls the blendstock or gasoline used or the gasoline produced at an 
oxygenate blending facility.
    (nn) Oxygenated fuels program reformulated gasoline, or OPRG means 
reformulated gasoline which is intended for use in an oxygenated fuels 
program control area, as defined at paragraph (pp) of this section, 
during an oxygenated fuels program control period, as defined at 
paragraph (qq) of this section.
* * * * *
    3. New subpart D, consisting of Secs. 80.40 through 80.89, subpart 
E, consisting of Secs. 80.90 through 80.124, and subpart F, consisting 
of Secs. 80.125 through 80.135, are added to read as follows:

Subpart D--Reformulated Gasoline

Sec.
80.40  Fuel certification procedures.
80.41  Standards and requirements for compliance.
80.42  Simple emissions model.
80.43-80.44  [Reserved]
80.45  Complex emissions model.
80.46  Measurement of reformulated gasoline fuel parameters.
80.47  [Reserved]
80.48  Augmentation of the complex emission model by vehicle 
testing.
80.49  Fuels to be used in augmenting the complex emission model 
through vehicle testing.
80.50  General test procedure requirements for augmentation of the 
emission models.
80.51  Vehicle test procedures.
80.52  Vehicle preconditioning.
80.53-80.54  [Reserved]
80.55  Measurement methods for benzene and 1,3-butadiene
80.56  Measurement methods for formaldehyde and acetaldehyde.
80.57-80.58  [Reserved]
80.59  General test fleet requirements for vehicle testing.
80.60  Test fleet requirements for exhaust emission testing.
80.61  [Reserved]
80.62  Vehicle test procedures to place vehicles in emitter group 
sub-fleets.
80.63-80.64  [Reserved]
80.65  General requirements for refiners, importers, and oxygenate 
blenders.
80.66  Calculation of reformulated gasoline properties.
80.67  Compliance on average.
80.68  Compliance surveys.
80.69  Requirements for downstream oxygenate blending.
80.70  Covered areas.
80.71  Descriptions of VOC-control regions.
80.72  [Reserved]
80.73  Inability to produce conforming gasoline in extraordinary 
circumstances.
80.74  Record keeping requirements.
80.75  Reporting requirements.
80.76  Registration of refiners, importers or oxygenate blender.
80.77  Product transfer documentation.
80.78  Controls and prohibitions on reformulated gasoline.
80.79  Liability for violations of the prohibited activities.
80.80  Penalties.
80.81  Enforcement exemptions for California gasoline.
80.82  Conventional gasoline marker. [Reserved]
80.83-80.89  [Reserved]

Subpart E--Anti-Dumping

80.90  Conventional gasoline baseline emissions determination.
80.91  Individual baseline determination.
80.92  Baseline auditor requirements.
80.93  Individual baseline submission and approval.
80.94-80.100  [Reserved]
80.101  Standards applicable to refiners and importers.
80.102  Controls applicable to blendstocks.
80.103  Registration of refiners and importers.
80.104  Record keeping requirements.
80.105  Reporting requirements.
80.106  Product transfer documents.
80.107-80.124  [Reserved]

Subpart F--Attest Engagements

80.125  Attest engagements.
80.126  Definitions.
80.127  Sample size guidelines.
80.128  Agreed upon procedures for refiners and importers.
80.129  Agreed upon procedures for downstream oxygenate blenders.
80.130  Agreed upon procedures reports.
80.131-80.135  [Reserved]

Subpart D--Reformulated Gasoline


Sec. 80.40  Fuel certification procedures.

    (a) Gasoline that complies with one of the standards specified in 
Sec. 80.41 (a) through (f) that is relevant for the gasoline, and that 
meets all other relevant requirements prescribed under Sec. 80.41, 
shall be deemed certified.
    (b) Any refiner or importer may, with regard to a specific fuel 
formulation, request from the Administrator a certification that the 
formulation meets one of the standards specified in Sec. 80.41 (a) 
through (f).


Sec. 80.41  Standards and requirements for compliance.

    (a) Simple model per-gallon standards. The ``simple model'' 
standards for compliance when achieved on a per-gallon basis are as 
follows: 

                   Simple Model Per-Gallon Standards                    
Reid vapor pressure (in pounds per square inch):                        
  Gasoline designated for VOC-Control Region 1................  X emissions performance reduction (percent).................  X emissions performance reduction (percent):                          
    Standard..................................................  X emissions performance reduction (percent):                          
  Gasoline designated as VOC-controlled.......................  X emissions performance reduction (percent):                          
  Gasoline designated as VOC-controlled:                                
    Standard..................................................  X emissions performance standards for any refinery 
or importer subject to the Phase I complex model standards shall be 
determined by evaluating all of the following parameter levels in the 
Phase I complex model (specified in Sec. 80.45) at one time:
    (1) The simple model values for benzene, RVP, and oxygen specified 
in Sec. 80.41 (a) or (b), as applicable;
    (2) The aromatics value which, together with the values for 
benzene, RVP, and oxygen determined under paragraph (j)(1)(i) of this 
section, meets the simple model toxics requirement specified in 
Sec. 80.41 (a) or (b), as applicable;
    (3) The refinery's or importer's individual baseline values for 
sulfur, E-300, and olefins, as established under Sec. 80.91; and
    (4) The appropriate seasonal value of E-200 specified in 
Sec. 80.45(b)(2).
    (k) Effect of VOC survey failure. (1) On each occasion during 1995 
or 1996 that a covered area fails a simple model VOC emissions 
reduction survey conducted pursuant to Sec. 80.68, the RVP requirements 
for that covered area beginning in the year following the failure shall 
be adjusted to be more stringent as follows:
    (i) The required average RVP level shall be decreased by an 
additional 0.1 psi; and
    (ii) The maximum RVP level for each gallon of averaged gasoline 
shall be decreased by an additional 0.1 psi.
    (2) On each occasion that a covered area fails a complex model VOC 
emissions reduction survey conducted pursuant to Sec. 80.68, or fails a 
simple model VOC emissions reduction survey conducted pursuant to 
Sec. 80.68 during 1997, the VOC emissions performance standard for that 
covered area beginning in the year following the failure shall be 
adjusted to be more stringent as follows:
    (i) The required average VOC emissions reduction shall be increased 
by an additional 1.0%; and
    (ii) The minimum VOC emissions reduction, for each gallon of 
averaged gasoline, shall be increased by an additional 1.0%.
    (3) In the event that a covered area for which required VOC 
emissions reductions have been made more stringent passes all VOC 
emissions reduction surveys in two consecutive years, the averaging 
standards VOC emissions reduction for that covered area beginning in 
the year following the second year of passed survey series shall be 
made less stringent as follows:
    (i) The required average VOC emissions reduction shall be decreased 
by 1.0%; and
    (ii) The minimum VOC emissions reduction shall be decreased by 
1.0%.
    (4) In the event that a covered area for which the required VOC 
emissions reductions have been made less stringent fails a subsequent 
VOC emissions reduction survey:
    (i) The required average VOC emission reductions for that covered 
area beginning in the year following this subsequent failure shall be 
made more stringent by increasing the required average and the minimum 
VOC emissions reduction by 1.0%; and
    (ii) The required VOC emission reductions for that covered area 
thereafter shall not be made less stringent regardless of the results 
of subsequent VOC emissions reduction surveys.
    (l) Effect of toxics survey failure. (1) On each occasion during 
1995 or 1996 that a covered area fails a simple model toxics emissions 
reduction survey series, conducted pursuant to Sec. 80.68, the simple 
model toxics emissions reduction requirement for that covered area 
beginning in the year following the year of the failure is made more 
stringent by increasing the average toxics emissions reduction by an 
additional 1.0%.
    (2) On each occasion that a covered area fails a complex model 
toxics emissions reduction survey series, conducted pursuant to 
Sec. 80.68, or fails a simple model toxics emissions reduction survey 
series conducted pursuant to Sec. 80.68 during 1997, the complex model 
toxics emissions reduction requirement for that covered area beginning 
in the year following the year of the failure is made more stringent by 
increasing the average toxics emissions reduction by an additional 
1.0%.
    (3) In the event that a covered area for which the toxics emissions 
standard has been made more stringent passes all toxics emissions 
survey series in two consecutive years, the averaging standard for 
toxics emissions reductions for that covered area beginning in the year 
following the second year of passed survey series shall be made less 
stringent by decreasing the average toxics emissions reduction by 1.0%.
    (4) In the event that a covered area for which the toxics emissions 
reduction standard has been made less stringent fails a subsequent 
toxics emissions reduction survey series:
    (i) The standard for toxics emissions reduction for that covered 
area beginning in the year following this subsequent failure shall be 
made more stringent by increasing the average toxics emissions 
reduction by 1.0%; and
    (ii) The standard for toxics emissions reduction for that covered 
area thereafter shall not be made less stringent regardless of the 
results of subsequent toxics emissions reduction surveys.
    (m) Effect of NOX survey failure. (1) On each occasion that a 
covered area fails a NOX emissions reduction survey conducted 
pursuant to Sec. 80.68, except in the case Phase II complex model 
NOX standards for VOC-controlled gasoline, the NOX emissions 
reduction requirements for that covered area beginning in the year 
following the failure shall be adjusted to be more stringent as 
follows:
    (i) The required average NOX emissions reduction shall be 
increased by an additional 1.0%; and
    (ii) The minimum NOX emissions reduction, for each gallon of 
averaged gasoline, shall be increased by an additional 1.0%.
    (2) In the event that a covered area for which required NOX 
emissions reductions have been made more stringent passes all NOX 
emissions reduction surveys in two consecutive years, the averaging 
standards for NOX emissions reduction for that covered area 
beginning in the year following the second year of passed survey series 
shall be made less stringent as follows:
    (i) The required average NOX emissions reduction shall be 
decreased by 1.0%; and
    (ii) The minimum NOX emissions reduction shall be decreased by 
1.0%.
    (3) In the event that a covered area for which the required 
NOX emissions reductions have been made less stringent fails a 
subsequent NOX emissions reduction survey:
    (i) The required average NOX emission reductions for that 
covered area beginning in the year following this subsequent failure 
shall be made more stringent by increasing the required average and the 
minimum NOX emissions reduction by 1.0%; and
    (ii) The required NOX emission reductions for that covered 
area thereafter shall not be made less stringent regardless of the 
results of subsequent NOX emissions reduction surveys.
    (n) Effect of benzene survey failure. (1) On each occasion that a 
covered area fails a benzene content survey series, conducted pursuant 
to Sec. 80.68, the benzene content standards for that covered area 
beginning in the year following the year of the failure shall be made 
more stringent as follows:
    (i) The average benzene content shall be decreased by 0.05% by 
volume; and
    (ii) The maximum benzene content for each gallon of averaged 
gasoline shall be decreased by 0.10% by volume.
    (2) In the event that a covered area for which the benzene 
standards have been made more stringent passes all benzene content 
survey series conducted in two consecutive years, the benzene standards 
for that covered area beginning in the year following the second year 
of passed survey series shall be made less stringent as follows:
    (i) The average benzene content shall be increased by 0.05% by 
volume; and
    (ii) The maximum benzene content for each gallon of averaged 
gasoline shall be increased by 0.10% by volume.
    (3) In the event that a covered area for which the benzene 
standards have been made less stringent fails a subsequent benzene 
content survey series:
    (i) The standards for benzene content for that covered area 
beginning in the year following this subsequent failure shall be the 
more stringent standards which were in effect prior to the operation of 
paragraph (n)(2) of this section; and
    (ii) The standards for benzene content for that covered area 
thereafter shall not be made less stringent regardless of the results 
of subsequent benzene content surveys.
    (o) Effect of oxygen survey failure. (1) In any year that a covered 
area fails an oxygen content survey series, conducted pursuant to 
Sec. 80.68, the minimum oxygen content requirement for that covered 
area beginning in the year following the year of the failure is made 
more stringent by increasing the minimum oxygen content standard, for 
each gallon of averaged gasoline, by an additional 0.1%; however, in no 
case shall the minimum oxygen content standard be greater than 2.0%.
    (2) In the event that a covered area for which the minimum oxygen 
content standard has been made more stringent passes all oxygen content 
survey series in two consecutive years, the minimum oxygen content 
standard for that covered area beginning in the year following the 
second year of passed survey series shall be made less stringent by 
decreasing the minimum oxygen content standard by 0.1%.
    (3) In the event that a covered area for which the minimum oxygen 
content standard has been made less stringent fails a subsequent oxygen 
content survey series:
    (i) The standard for minimum oxygen content for that covered area 
beginning in the year following this subsequent failure shall be made 
more stringent by increasing the minimum oxygen content standard by 
0.1%; and
    (ii) The minimum oxygen content standard for that covered area 
thereafter shall not be made less stringent regardless of the results 
of subsequent oxygen content surveys.
    (p) Effective date for changed minimum or maximum standards. In the 
case of any minimum or maximum standard that is changed to be more 
stringent by operation of paragraphs (k), (m), (n), or (o) of this 
section, the effective date for such change shall be ninety days 
following the date EPA announces the change.
    (q) Refineries, importers, and oxygenate blenders subject to 
adjusted standards. Standards for average compliance that are adjusted 
to be more or less stringent by operation of paragraphs (k), (l), (m), 
(n), or (o) of this section apply to averaged reformulated gasoline 
produced at each refinery or oxygenate blending facility, or imported 
by each importer as follows:
    (1) Adjusted standards for a covered area apply to averaged 
reformulated gasoline that is produced at a refinery or oxygenate 
blending facility if:
    (i) Any averaged reformulated gasoline from that refinery or 
oxygenate blending facility supplied the covered area during any year a 
survey was conducted which gave rise to a standards adjustment; or
    (ii) Any averaged reformulated gasoline from that refinery or 
oxygenate blending facility supplies the covered area during any year 
that the standards are more stringent than the initial standards; 
unless
    (iii) The refiner or oxygenate blender is able to show that the 
volume of averaged reformulated gasoline from a refinery or oxygenate 
blending facility that supplied the covered area during any year under 
paragraphs (q)(1) (i) or (ii) of this section was less than one percent 
of the reformulated gasoline produced at the refinery or oxygenate 
blending facility during that year, or 100,000 barrels, whichever is 
less.
    (2) Adjusted standards for a covered area apply to averaged 
reformulated gasoline that is imported by an importer if:
    (i) The covered area with the adjusted standard is located in 
Petroleum Administration for Defense District (PADD) I, and the 
gasoline is imported at a facility located in PADDs I, II or III;
    (ii) The covered area with the adjusted standard is located in PADD 
II, and the gasoline is imported at a facility located in PADDs I, II, 
III, or IV;
    (iii) The covered area with the adjusted standard is located in 
PADD III, and the gasoline is imported at a facility located in PADDs 
II, III, or IV;
    (iv) The covered area with the adjusted standard is located in PADD 
IV, and the gasoline is imported at a facility located in PADDs II, or 
IV; or
    (v) The covered area with the adjusted standard is located in PADD 
V, and the gasoline is imported at a facility located in PADDs III, IV, 
or V; unless
    (vi) Any gasoline which is imported by an importer at any facility 
located in any PADD supplies the covered area, in which case the 
adjusted standard also applies to averaged gasoline imported at that 
facility by that importer.
    (3) Any gasoline that is transported in a fungible manner by a 
pipeline, barge, or vessel shall be considered to have supplied each 
covered area that is supplied with any gasoline by that pipeline, or 
barge or vessel shipment, unless the refiner or importer is able to 
establish that the gasoline it produced or imported was supplied only 
to a smaller number of covered areas.
    (4) Adjusted standards apply to all averaged reformulated gasoline 
produced by a refinery or imported by an importer identified in this 
paragraph (q), except:
    (i) In the case of adjusted VOC standards for a covered area 
located in VOC Control Region 1, the adjusted VOC standards apply only 
to averaged reformulated gasoline designated as VOC-controlled intended 
for use in VOC Control Region 1; and
    (ii) In the case of adjusted VOC standards for a covered area 
located in VOC Control Region 2, the adjusted VOC standards apply only 
to averaged reformulated gasoline designated as VOC-controlled intended 
for use in VOC Control Region 2.
    (r) Definition of PADD. For the purposes of this section only, the 
following definitions of PADDs apply:
    (1) The following states are included in PADD I:

Connecticut
Delaware
District of Columbia
Florida
Georgia
Maine
Maryland
Massachusetts
New York
New Hampshire
New Jersey
North Carolina
Pennsylvania
Rhode Island
South Carolina
Vermont
Virginia
West Virginia

    (2) The following states are included in PADD II:

Illinois
Indiana
Iowa
Kansas
Kentucky
Michigan
Minnesota
Missouri
Nebraska
North Dakota
Ohio
Oklahoma
South Dakota
Tennessee
Wisconsin

    (3) The following states are included in PADD III:

Alabama
Arkansas
Louisiana
Mississippi
New Mexico
Texas

    (4) The following states are included in PADD IV:

Colorado
Idaho
Montana
Utah
Wyoming

    (5) The following states are included in PADD V:

Arizona
California
Nevada
Oregon
Washington


Sec. 80.42  Simple emissions model.

    (a) VOC emissions. The following equations shall comprise the 
simple model for VOC emissions. The simple model for VOC emissions 
shall be used only in determining toxics emissions:

Summer=The period of May 1 through September 15
Winter=The period of September 16 through April 30
EXHVOCS1=Exhaust nonmethane VOC emissions from the fuel in question, in 
grams per mile, for VOC control region 1 during the summer period
EXHVOCS2=Exhaust nonmethane VOC emissions from the fuel in question, in 
grams per mile, for VOC control region 2 during the summer period
EXHVOCW=Exhaust nonmethane VOC emissions from the fuel in question, in 
grams per mile, for the winter period
EVPVOCS1=Evaporative VOC emissions from the fuel in question, in grams 
per mile for VOC control region 1 during the summer period
EVPVOCS2=Evaporative VOC emissions from the fuel in question, in grams 
per mile for VOC control region 2 during the summer period
RLVOCS1=Running loss VOC emissions from the fuel in question, in grams 
per mile for VOC control region 1 during the summer period
RLVOCS2=Running loss VOC emissions from the fuel in question, in grams 
per mile for VOC control region 2 during the summer period
REFVOCS1=Refueling VOC emissions from the fuel in question, in grams 
per mile for VOC control region 1 during the summer period
REFVOCS2=Refueling VOC emissions from the fuel in question, in grams 
per mile for VOC control region 2 during the summer period
OXCON=Oxygen content of the fuel in question, in terms of weight 
percent (as measured under Sec. 80.46)
RVP=Reid vapor pressure of the fuel in question, in pounds per square 
inch (psi)

    (1) The following equations shall comprise the simple model for VOC 
emissions in VOC Control Region 1 during the summer period:

EXHVOCS1=0.444 x (1-(0.127/2.7) x OXCON)
EVPVOCS1=0.7952-0.2461 x RVP +0.02293 x RVP x RVP
RLVOCS1=-0.734+0.1096 x RVP +0.002791 x RVP x RVP
REFVOCS1=0.04 x ((0.1667 x RVP)-0.45)

    (2) The following equations shall comprise the simple model for VOC 
emissions in VOC Control Region 2 during the summer period:

EXHVOCS2=0.444 x (1-(0.127/2.7) x OXCON)
EVPVOCS2=0.813-0.2393 x RVP +0.021239 x RVP x RVP
RLVOCS2=0.2963-0.1306 x RVP +0.016255 x RVP x RVP
REFVOCS2=0.04 x ((0.1667 x RVP)-0.45)

    (3) The following equation shall comprise the simple model for VOC 
emissions during the winter period:

EXHVOCW=0.656 x (1-(0.127/2.7) x OXCON)

    (b) Toxics emissions. The following equations shall comprise the 
simple model for toxics emissions:

EXHBEN=Exhaust benzene emissions from the fuel in question, in 
milligrams per mile
EVPBEN=Evaporative benzene emissions from the fuel in question, in 
milligrams per mile
HSBEN=Hot soak benzene emissions from the fuel in question, in 
milligrams per mile
DIBEN=Diurnal benzene emissions from the fuel in question, in 
milligrams per mile
RLBEN=Running loss benzene emissions from the fuel in question, in 
milligrams per mile
REFBEN=Refueling benzene emissions from the fuel in question, in 
milligrams per mile
MTBE=Oxygen content of the fuel in question in the form of MTBE, in 
terms of weight percent (as measured under Sec. 80.46)
ETOH=Oxygen content of the fuel in question in the form of ethanol, in 
terms of weight percent (as measured under Sec. 80.46)
ETBE=Oxygen content of the fuel in question in the form of ETBE, in 
terms of weight percent (as measured under Sec. 80.46)
FORM=Formaldehyde emissions from the fuel in question, in milligrams 
per mile
ACET=Acetaldehyde emissions from the fuel in question, in milligrams 
per mile
POM=Emissions of polycyclic organic matter from the fuel in question, 
in milligrams per mile
BUTA=Emissions of 1,3-Butadiene from the fuel in question, in 
milligrams per mile
FBEN=Fuel benzene of the fuel in question, in terms of volume percent 
(as measured under Sec. 80.46)
FAROM=Fuel aromatics of the fuel in question, in terms of volume 
percent (as measured under Sec. 80.46)
TOXREDS1=Total toxics reduction of the fuel in question during the 
summer period for VOC control region 1 in percent
TOXREDS2=Total toxics reduction of the fuel in question during the 
summer period for VOC control region 2 in percent
TOXREDW=Total toxics reduction of the fuel in question during the 
winter period in percent

    (1) The following equations shall comprise the simple model for 
toxics emissions in VOC control region 1 during the summer period:

TOXREDS1=[100 x (53.2-EXHBEN -EVPBEN-RLBEN-REFBEN -FORM-ACET-BUTA 
-POM)]/53.2
EXHBEN=[1.884+0.949  x  FBEN+0.113  x  (FAROM-FBEN))/100]  x  1000  x  
EXHVOCS1
EVPBEN=HSBEN+DIBEN
HSBEN=FBEN  x  (EVPVOCS1  x  0.679)  x  1000  x  [(1.4448-(0.0684  x  
MTBE/2.0)-(0.080274  x  RVP))/100]
DIBEN=FBEN  x  (EVPVOCS1  x  0.321)  x  1000  x  [(1.3758-(0.0579  x  
MTBE/2.0)-(0.080274  x  RVP))/100]
RLBEN=FBEN  x  RLVOCS1  x  1000  x  [(1.4448-(0.0684  x  MTBE/
2.0)-(0.080274  x  RVP))/100]
REFBEN=FBEN  x  REFVOCS1  x  1000  x  [(1.3972-(0.0591xMTBE/
2.0)-(0.081507  x  RVP))/100] BUTA=0.00556xEXHVOCS1x1000
POM=3.15  x  EXHVOCS1

    (i) For any oxygenate or mixtures of oxygenates, the formaldehyde 
and acetaldehyde shall be calculated with the following equations:

FORM=0.01256  x  EXHVOCS1  x  1000  x  [1+(0.421/2.7)  x  
MTBE+TAME)+(0.358/3.55)  x  ETOH + (0.137/2.7)  x  (ETBE+ETAE)]
ACET=0.00891  x  EXHVOCS1  x  1000  x  [1 + (0.078/2.7)  x  
(MTBE+TAME)+(0.865/3.55)  x  ETOH+(0.867/2.7)  x  (ETBE+ETAE)]

    (ii) When calculating formaldehyde and acetaldehyde emissions using 
the equations in paragraph (b)(1)(i) of this section, oxygen in the 
form of alcohols which are more complex or have higher molecular 
weights than ethanol shall be evaluated as if it were in the form of 
ethanol. Oxygen in the form of methyl ethers other than TAME and MTBE 
shall be evaluated as if it were in the form of MTBE. Oxygen in the 
form of ethyl ethers other than ETBE shall be evaluated as if it were 
in the form of ETBE. Oxygen in the form of non-methyl, non-ethyl ethers 
shall be evaluated as if it were in the form of ETBE.
    (2) The following equations shall comprise the simple model for 
toxics emissions in VOC control region 2 during the summer period:

TOXREDS2=100  x  (52.1 - EXHBEN - EVPBEN - RLBEN - REFBEN - FORM - ACET 
- BUTA - POM)/52.1
EXHBEN=[(1.884+0.949  x  FBEN+0.113  x  (FAROM-FBEN))/100]  x  1000  x  
EXHVOCS2
EVPBEN=HSBEN+DIBEN
HSBEN=FBEN  x  (EVPVOCS2  x  0.679)  x  1000  x  [(1.4448-(0.0684  x  
MTBE/2.0)-(0.080274  x  RVP))/100]
DIBEN=FBEN  x  (EVPVOCS2  x  0.321)  x  1000  x  [(1.3758-(0.0579  x  
MTBE/2.0)-(0.080274  x  RVP))/100]
RLBEN=FBEN  x  RLVOCS2  x  1000  x  [(1.4448-(0.0684  x  MTBE/
2.0)-(0.080274  x  RVP))/100]
REFBEN=FBEN  x  REFVOCS2  x  1000  x  [(1.3972-(0.0591  x  MTBE/
2.0)-(0.081507  x  RVP))/100]
BUTA=0.00556  x  EXHVOCS2  x  1000
POM=3.15  x  EXHVOCS2

    (i) For any oxygenate or mixtures of oxygenates, the formaldehyde 
and acetaldehyde shall be calculated with the following equations:

FORM=0.01256  x  EEXHVOCS2  x  1000  x  [1+(0.421/2.7)  x  
(MTBE+TAME)+(0.358/3.55)  x  ETOH+(0.137/2.7)  x  (ETBE+ETAE)]
ACET=0.00891  x  EXHVOCS2  x  1000  x  [1+(0.078/2.7)  x  
(MTBE+TAME)+(0.865/3.55)  x  ETOH+(0.867/2.7)  x  (ETBE+ETAE)]

    (ii) When calculating formaldehyde and acetaldehyde emissions using 
the equations in paragraph (b)(2)(i) of this section, oxygen in the 
form of alcohols which are more complex or have higher molecular 
weights than ethanol shall be evaluated as if it were in the form of 
ethanol. Oxygen in the form of methyl ethers other than TAME and MTBE 
shall be evaluated as if it were in the form of MTBE. Oxygen in the 
form of ethyl ethers other than ETBE shall be evaluated as if it were 
in the form of ETBE. Oxygen in the form of non-methyl, non-ethyl ethers 
shall be evaluated as if it were in the form of ETBE.
    (3) The following equations shall comprise the simple model for 
toxics emissions during the winter period:

TOXREDW=100  x  (55.5-EXHBEN-FORM-ACET -BUTA-POM) /55.5
EXHBEN=[(1.884+0.949  x  FBEN+0.113  x  (FAROM-FBEN)) /100]  x  1000 
x  EXHVOCW
BUTA=0.00556  x  EXHVOCW  x  1000
POM=2.13  x  EXHVOCW

    (i) For any oxygenate or mixtures of oxygenates, the formaldehyde 
and acetaldehyde shall be calculated with the following equations:

FORM=0.01256  x  EXHVOCS1  x  1000  x  [1+(0.421/2.7)  x  
(MTBE+TAME)+(0.358/3.55)  x  ETOH+(0.137/2.7)  x  (ETBE+ETAE)]
ACET=0.00891  x  EXHVOCS1  x  1000  x  [1+(0.078/2.7)  x  
(MTBE+TAME)+(0.865/3.55)  x  ETOH+(0.867/2.7)  x  (ETBE+ETAE)]

    (ii) When calculating formaldehyde and acetaldehyde emissions using 
the equations in paragraph (b)(3)(i) of this section, oxygen in the 
form of alcohols which are more complex or have higher molecular 
weights than ethanol shall be evaluated as if it were in the form of 
ethanol. Oxygen in the form of methyl ethers other than TAME and MTBE 
shall be evaluated as if it were in the form of MTBE. Oxygen in the 
form of ethyl ethers other than ETBE shall be evaluated as if it were 
in the form of ETBE. Oxygen in the form of non-methyl, non-ethyl ethers 
shall be evaluated as if it were in the form of ETBE.
    (c) Limits of the model. (1) The model given in paragraphs (a) and 
(b) of this section shall be used as given to determine VOC and toxics 
emissions, respectively, if the properties of the fuel being evaluated 
fall within the ranges shown in this paragraph (c). If the properties 
of the fuel being evaluated fall outside the range shown in this 
paragraph (c), the model may not be used to determine the VOC or toxics 
performance of the fuel:

------------------------------------------------------------------------
          Fuel parameter                            Range               
------------------------------------------------------------------------
Benzene content....................  0-2.5 vol %                        
RVP................................  6.6-9.0 psi                        
Oxygenate content..................  0-3.5 vol %                        
Aromatics content..................  10-45 vol %                        
------------------------------------------------------------------------

    (2) The model given in paragraphs (a) and (b) of this section shall 
be effective from January 1, 1995 through December 31, 1997, unless 
extended by action of the Administrator.


Secs. 80.43-80.44  [Reserved]


Sec. 80.45  Complex emissions model.

    (a) Definition of terms. For the purposes of this section, the 
following definitions shall apply:

Target fuel=The fuel which is being evaluated for its emissions 
performance using the complex model
OXY=Oxygen content of the target fuel in terms of weight percent
SUL=Sulfur content of the target fuel in terms of parts per million by 
weight
RVP=Reid Vapor Pressure of the target fuel in terms of pounds per 
square inch
E200=200  deg.F distillation fraction of the target fuel in terms of 
volume percent
E300=300  deg.F distillation fraction of the target fuel in terms of 
volume percent
ARO=Aromatics content of the target fuel in terms of volume percent
BEN=Benzene content of the target fuel in terms of volume percent
OLE=Olefins content of the target fuel in terms of volume percent
MTB=Methyl tertiary butyl ether content of the target fuel in terms of 
weight percent oxygen
ETB=Ethyl tertiary butyl ether content of the target fuel in terms of 
weight percent oxygen
TAM=Tertiary amyl methyl ether content of the target fuel in terms of 
weight percent oxygen
ETH=Ethanol content of the target fuel in terms of weight percent 
oxygen
exp=The function that raises the number e (the base of the natural 
logarithm) to the power in its domain
Phase I=The years 1995-1999
Phase II=Year 2000 and beyond

    (b) Weightings and baselines for the complex model. (1) The 
weightings for normal and higher emitters (w1 and w2, 
respectively) given in Table 1 shall be used to calculate the exhaust 
emission performance of any fuel for the appropriate pollutant and 
Phase:

  Table 1.--Normal and Higher Emitter Weightings for Exhaust Emissions  
------------------------------------------------------------------------
                                          Phase I           Phase II    
                                     -----------------------------------
                                       VOC &             VOC &          
                                      toxics     NOX    toxics     NOX  
------------------------------------------------------------------------
Normal Emitters (w1)................     0.52     0.82    0.444    0.738
Higher Emitters (w2)................     0.48     0.18    0.556    0.262
------------------------------------------------------------------------

    (2) The following properties of the baseline fuels shall be used 
when determining baseline mass emissions of the various pollutants:

          Table 2.--Summer and Winter Baseline Fuel Properties          
------------------------------------------------------------------------
                  Fuel property                      Summer      Winter 
------------------------------------------------------------------------
Oxygen (wt %).....................................       0.0        0.0 
Sulfur (ppm)......................................     339        338   
RVP (psi).........................................       8.7       11.5 
E200 (%)..........................................      41.0       50.0 
E300 (%)..........................................      83.0       83.0 
Aromatics (vol %).................................      32.0       26.4 
Olefins (vol %)...................................       9.2       11.9 
Benzene (vol %)...................................       1.53       1.64
------------------------------------------------------------------------

    (3) The baseline mass emissions for VOC, NOX and toxics given 
in Tables 3, 4 and 5 of this paragraph (b)(3) shall be used in 
conjunction with the complex model during the appropriate Phase and 
season:

                  Table 3.--Baseline Exhaust Emissions                  
------------------------------------------------------------------------
                                    Phase I               Phase II      
                             -------------------------------------------
     Exhaust pollutant          Summer     Winter     Summer            
                              (mg/mile)  (mg/mile)  (mg/mile)    Winter 
                                                               (mg/mile)
------------------------------------------------------------------------
VOC.........................     446        660        907       1341   
NOX.........................     660        750       1340       1540   
Benzene.....................      26.10      37.57      53.54      77.62
Acetaldehyde................       2.19       3.57       4.44       7.25
Formaldehyde................       4.85       7.73       9.70      15.34
1,3-Butadiene...............       4.31       7.27       9.38      15.84
POM.........................       1.50       2.21       3.04       4.50
------------------------------------------------------------------------


         Table 4.--Baseline Non-Exhaust Emissions (Summer Only)         
------------------------------------------------------------------------
                                    Phase I               Phase II      
                             -------------------------------------------
   Non-exhaust pollutant       Region 1   Region 2   Region 1           
                              (mg/mile)  (mg/mile)  (mg/mile)   Region 2
                                                               (mg/mile)
------------------------------------------------------------------------
VOC.........................     860.48     769.10     559.31     492.07
Benzene.....................       9.66       8.63       6.24       5.50
------------------------------------------------------------------------


                                                 Table 5.--Total Baseline VOC, NOX and Toxics Emissions                                                 
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                         Summer (mg/mile)                                Winter (mg/mile)               
                                                         -----------------------------------------------------------------------------------------------
                       Pollutant                                 Phase I                 Phase II                Phase I                 Phase II       
                                                         -----------------------------------------------------------------------------------------------
                                                           Region 1    Region 2    Region 1    Region 2    Region 1    Region 2    Region 1    Region 2 
--------------------------------------------------------------------------------------------------------------------------------------------------------
NOX.....................................................      660.0       660.0      1340.0      1340.0       750.0       750.0      1540.0      1540.0 
VOC.....................................................     1306.5      1215.1      1466.3      1399.1       660.0       660.0      1341.0      1341.0 
Toxics..................................................       48.61       47.58       86.34       85.61       58.36       58.36      120.55      120.55
--------------------------------------------------------------------------------------------------------------------------------------------------------

    (c) VOC performance. (1) The exhaust VOC emissions performance of 
gasolines shall be given by the following equations:

VOCE=VOC(b)+(VOC(b) x Yvoc(t)/100)
Yvoc(t)=[(w1 x Nv)+(w2 x Hv)-1] x 100

where

VOCE=Exhaust VOC emissions in milligrams/mile
Yvoc(t)=Exhaust VOC performance of the target fuel in terms of 
percentage change from baseline
VOC(b)=Baseline exhaust VOC emissions as defined in paragraph (b)(2) of 
this section for the appropriate Phase and season
Nv=[exp v1(t)]/[exp v1(b)]
Hv=[exp v2(t)]/[exp v2(b)]
w1=Weighting factor for normal emitters as defined in paragraph 
(b)(1) of this section for the appropriate Phase
w2=Weighting factor for higher emitters as defined in paragraph 
(b)(1) of this section for the appropriate Phase
v1(t)=Normal emitter VOC equation as defined in paragraph 
(c)(1)(i) of this section, evaluated using the target fuel's properties 
subject to paragraphs (c)(1) (iii) and (iv) of this section
v2(t)=Higher emitter VOC equation as defined in paragraph 
(c)(1)(ii) of this section, evaluated using the target fuel's 
properties subject to paragraphs (c)(1) (iii) and (iv) of this section
v1(b)=Normal emitter VOC equation as defined in paragraph 
(c)(1)(i) of this section, evaluated using the base fuel's properties
v2(b)=Higher emitter VOC equation as defined in paragraph 
(c)(1)(ii) of this section, evaluated using the base fuel's properties

    (i) Consolidated VOC equation for normal emitters.

v1=(-0.003641 x OXY)+(0.0005219 x SUL)+(0.0289749 x RVP)+(-0.014470
 x E200)+(-0.068624 x E300)+(0.0323712 x ARO)+(-0.002858 x OLE)+(0.00010
72 x E2002)+(0.0004087 x E3002)+(-0.0003481 x ARO x E300)

    (ii) VOC equation for higher emitters.

v2=(-0.003626 x OXY)+(-5.40X10-
\5\ x SUL)+(0.043295 x RVP)+(-0.013504 x E200)+(-0.062327 x E300)+(0.028
2042 x ARO)+(-0.002858 x OLE)+(0.000106 x E200\2\)+(0.000408 x E300\2\)+
(-0.000287 x ARO x E300)

    (iii) Flat line extrapolations. (A) During Phase I, fuels with E200 
values greater than 65.83 percent shall be evaluated with the E200 fuel 
parameter set equal to 65.83 percent when calculating Yvoc(t) and 
VOCE using the equations described in paragraphs (c)(1) (i) and (ii) of 
this section. Fuels with E300 values greater than E300* (calculated 
using the equation E300*=80.32+[0.390 x ARO]) shall be evaluated with 
the E300 parameter set equal to E300* when calculating VOCE using the 
equations described in paragraphs (c)(1) (i) and (ii) of this section. 
For E300* values greater than 94, the linearly extrapolated model 
presented in paragraph (c)(1)(iv) of this section shall be used.
    (B) During Phase II, fuels with E200 values greater than 65.52 
percent shall be evaluated with the E200 fuel parameter set equal to 
65.52 percent when calculating VOCE using the equations described in 
paragraphs (c)(1) (i) and (ii) of this section. Fuels with E300 values 
greater than E300* (calculated using the equation E300*=79.75+[0.385 
x ARO]) shall be evaluated with the E300 parameter set equal to E300* 
when calculating VOCE using the equations described in paragraphs 
(c)(1) (i) and (ii) of this section. For E300* values greater than 94, 
the linearly extrapolated model presented in paragraph (c)(1)(iv) of 
this section shall be used.
    (iv) Linear extrapolations. (A) The equations in paragraphs (c)(1) 
(i) and (ii) of this section shall be used within the allowable range 
of E300, E200, and ARO for the appropriate Phase, as defined in Table 
6: 

  Table 6.--Allowable Ranges of E200, E300, and ARO for the Exhaust VOC 
       Equations in Paragraphs (c)(1)(i) and (ii) of This Section       
------------------------------------------------------------------------
                                      Phase I             Phase II      
                               -----------------------------------------
        Fuel parameter           Lower     Higher     Lower     Higher  
                                 limit     limit      limit      limit  
------------------------------------------------------------------------
E200..........................    33.00       65.83    33.00       65.52
E300..........................    72.00  \1\Variabl                     
                                                  e    72.00  \2\Variabl
                                                                       e
ARO...........................    18.00       46.00    18.00      46.00 
------------------------------------------------------------------------
\1\Higher E300 Limit=80.32+[0.390 x (ARO)].                             
\2\Higher E300 Limit=79.75+[0.385 x (ARO)].                             

    (B) For fuels with E200, E300 and ARO levels outside the ranges 
defined in Table 6, Yvoc(t) shall be defined as:

For Phase I:

Yvoc(t)=100% x 0.52 x [exp(v1(et)) /exp(v1(b))-1] 
+100% x 0.48 x [exp(v2(et)) /exp(v2(b))-1] 
+{[100% x 0.52 x exp(v1(et)) /exp(v1(b))] x  
[{[(0.0002144 x E200et) -0.014470] x E200} 
+{[(0.0008174 x E300et) -0.068624-(0.000348 x AROet)] x  
E300}+{[(-0.000348 x E300et) 
+0.0323712] x ARO}]} +{[100% x 0.48 x exp(v2(et)) /
exp(v2(b))]  x [{[(0.000212 x E200et) 
-0.01350] x E200} +{[(0.000816 x E300et) 
-0.06233-(0.00029 x AROet)] x  
E300}+{[(-0.00029 x E300et) +0.028204] x ARO}]}

For Phase II:

Yvoc(t)=100% x 0.444 x [exp(v1(et)) /exp(v1(b))-1] 
+100% x 0.556 x [exp(v2(et)) /exp(v2(b))-1] 
+{[100% x 0.444 x exp(v1(et)) /exp(v1(b))] x  
[{[(0.0002144 x E200et) 0.014470] x E200} 
+{[(0.0008174 x E300et) -0.068624-(0.000348 x AROet)] x  
E300}+{[(-0.000348 x E300et) 
+0.0323712] x ARO}]} +{[100% x 0.556 x exp(v2(et)) /
exp(v2(b))] x  [{[(0.000212 x E200et) 
-0.01350] x E200}+ {[(0.000816 x E300et) 
-0.06233-(0.00029 x AROet)] x  
E300}+{[(-0.00029 x E300et) +0.028204] x ARO}]}

where

v1, v2=The equations defined in paragraphs (c)(1) (i) and 
(ii) of this section
et=Collection of fuel parameters for the ``edge target'' fuel. These 
parameters are defined in paragraphs (c)(1)(iv)(C) and (D) of this 
section
v1(et)=The function v1 evaluated with ``edge target'' fuel 
parameters, which are defined in paragraphs (c)(1)(iv)(C) and (D) of 
this section
v2(et)=The function v2 evaluated with ``edge target'' fuel 
parameters, which are defined in paragraphs (c)(1)(iv)(C) and (D) of 
this section
v1(b)=The function v1 evaluated with the appropriate baseline 
fuel defined in paragraph (b)(2) of this section
v2(b)=The function v2 evaluated with the appropriate baseline 
fuel defined in paragraph (b)(2) of this section
E200et=The value of E200 for the ``edge target'' fuel, as defined 
in paragraphs (c)(1)(iv)(C) and (D) of this section
E300et=The value of E300 for the ``edge target'' fuel, as defined 
in paragraphs (c)(1)(iv)(C) and (D) of this section
AROet=The value of ARO for the ``edge target'' fuel, as defined in 
paragraphs (c)(1)(iv)(C) and (D) of this section.

    (C) During Phase I, the ``edge target'' fuel shall be identical to 
the target fuel for all fuel parameters, with the following exceptions:
    (1) If the E200 level of the target fuel is less than 33 volume 
percent, then the E200 value for the ``edge target'' fuel shall be set 
equal to 33 volume percent.
    (2) If the aromatics level of the target fuel is less than 18 
volume percent, then the ARO value for the ``edge target'' fuel shall 
be set equal to 18 volume percent.
    (3) If the aromatics level of the target fuel is greater than 46 
volume percent, then the ARO value for the ``edge target'' fuel shall 
be set equal to 46 volume percent.
    (4) If the E300 level of the target fuel is less than 72 volume 
percent, then the E300 value for the ``edge target'' fuel shall be set 
equal to 72 volume percent.
    (5) If the E300 level of the target fuel is greater than 95 volume 
percent, then the E300 value for the ``edge target'' fuel shall be set 
equal to 95 volume percent.
    (6) If [80.32+(0.390 x ARO)] exceeds 94 for the target fuel, then 
the E300 value for the ``edge target'' fuel shall be set equal to 94 
volume percent.
    (7) If the E200 level of the target fuel is less than 33 volume 
percent, then E200 shall be set equal to (E200-33 volume 
percent).
    (8) If the E200 level of the target fuel equals or exceeds 33 
volume percent, then E200 shall be set equal to zero.
    (9) If the aromatics level of the target fuel is less than 18 
volume percent, then ARO shall be set equal to (ARO-18 volume 
percent). If the aromatics level of the target fuel is less than 10 
volume percent, then ARO shall be set equal to 8 volume 
percent.
    (10) If the aromatics level of the target fuel is greater than 46 
volume percent, then ARO shall be set equal to (ARO-46 volume 
percent).
    (11) If neither of the conditions established in paragraphs 
(c)(1)(iv)(C)(8) and (9) of this section are met, then ARO 
shall be set equal to zero.
    (12) If the E300 level of the target fuel is less than 72 volume 
percent, then E300 shall be set equal to (E300-72 volume percent).
    (13) If the E300 level of the target fuel is less than 94 volume 
percent and [80.32+(0.390 x ARO)] also is greater than 94, then 
E300 shall be set equal to (E300-94 volume percent). If the 
E300 level of the target fuel is greater than 95 volume percent and 
[80.32+(0.390 x ARO)] also is greater than 94, then E300 shall 
be set equal to 1 volume percent.
    (14) If neither of the conditions established in paragraphs 
(c)(1)(iv)(C)(11) and (12) of this section are met, then E300 
shall be set equal to zero.
    (D) During Phase II, the ``edge target'' fuel is identical to the 
target fuel for all fuel parameters, with the following exceptions:
    (1) If the E200 level of the target fuel is less than 33 volume 
percent, then the E200 value for the ``edge target'' fuel shall be set 
equal to 33 volume percent.
    (2) If the aromatics level of the target fuel is less than 18 
volume percent, then the ARO value for the ``edge target'' fuel shall 
be set equal to 18 volume percent.
    (3) If the aromatics level of the target fuel is greater than 46 
volume percent, then the ARO value for the ``edge target'' fuel shall 
be set equal to 46 volume percent.
    (4) If the E300 level of the target fuel is less than 72 volume 
percent, then the E300 value for the ``edge target'' fuel shall be set 
equal to 72 volume percent.
    (5) If the E300 level of the target fuel is greater than 95 volume 
percent, then the E300 value for the ``edge target'' fuel shall be set 
equal to 95 volume percent.
    (6) If [79.75+(0.385 x ARO)] exceeds 94 for the target fuel, then 
the E300 value for the ``edge target'' fuel shall be set equal to 94 
volume percent.
    (7) If the E200 level of the target fuel is less than 33 volume 
percent, then E200 shall be set equal to (E200-33 volume 
percent).
    (8) If the E200 level of the target fuel equals or exceeds 33 
volume percent, then E200 shall be set equal to zero.
    (9) If the aromatics level of the target fuel is less than 18 
volume percent and greater than or equal to 10 volume percent, then 
ARO shall be set equal to (ARO-18 volume percent). If the 
aromatics level of the target fuel is less than 10 volume percent, then 
ARO shall be set equal to 8 volume percent.
    (10) If the aromatics level of the target fuel is greater than 46 
volume percent, then ARO shall be set equal to (ARO-46 volume 
percent).
    (11) If neither of the conditions established in paragraphs 
(c)(1)(iv)(D)(8) and (9) of this section are met, then ARO 
shall be set equal to zero.
    (12) If the E300 level of the target fuel is less than 72 volume 
percent, then E300 shall be set equal to (E30'0-72 volume 
percent).
    (13) If the E300 level of the target fuel is less than 94 volume 
percent and [79.75+(0.385 x ARO)] also is greater than 94, then 
E300 shall be set equal to (E300-94 volume percent). If the 
E300 level of the target fuel is greater than 95 volume percent and 
[79.75+(0.385 x ARO)] also is greater than 94, then E300 shall 
be set equal to 1 volume percent.
    (14) If neither of the conditions established in paragraphs 
(c)(1)(iv)(D)(11) and (12) of this section are met, then E300 
shall be set equal to zero.
    (2) The winter exhaust VOC emissions performance of gasolines shall 
be given by the equations presented in paragraph (c)(1) of this section 
with the RVP value set to 8.7 psi for both the baseline and target 
fuels.
    (3) The nonexhaust VOC emissions performance of gasolines in VOC 
Control Region 1 shall be given by the following equations, where:

VOCNE1=Total nonexhaust emissions of volatile organic compounds in VOC 
Control Region 1 in grams per mile
VOCDI1=Diurnal emissions of volatile organic compounds in VOC Control 
Region 1 in grams per mile
VOCHS1=Hot soak emissions of volatile organic compounds in VOC Control 
Region 1 in grams per mile
VOCRL1=Running loss emissions of volatile organic compounds in VOC 
Control Region 1 in grams per mile
VOCRF1=Refueling emissions of volatile organic compounds in VOC Control 
Region 1 in grams per mile

    (i) During Phase I:

VOCNE1=VOCDI1+VOCHS1+ VOCRL1+VOCRF1
VOCDI1=[0.00736  x  (RVP\2\)]-[0.0790  x  RVP]+0.2553
VOCHS1=[0.01557  x  (RVP\2\)]-[0.1671  x  RVP]+0.5399
VOCRL1=[0.00279  x  (RVP\2\)]-[0.1096  x  RVP]-0.7340
VOCRF1=[0.006668  x  RVP]-0.0180

    (ii) During Phase II:

VOCNE1=VOCDI1+VOCHS1+ VOCRL1+VOCRF1
VOCDI1=[0.007385  x  (RVP\2\)]-[0.08981  x  RVP]+0.3158
VOCHS1=[0.006654  x  (RVP\2\)]-[0.08009  x  RVP]+0.2846
VOCRL1=[0.017768  x  (RVP\2\)]-[0.18746  x  RVP]+0.6146
VOCRF1=[0.0004767  x  RVP]+0.011859

    (4) The nonexhaust VOC emissions performance of gasolines in VOC 
Control Region 2 shall be given by the following equations, where:

VOCNE2=Total nonexhaust emissions of volatile organic compounds in VOC 
Control Region 2 in grams per mile
VOCDI2=Diurnal emissions of volatile organic compounds in VOC Control 
Region 2 in grams per mile
VOCHS2=Hot soak emissions of volatile organic compounds in VOC Control 
Region 2 in grams per mile
VOCRL2=Running loss emissions of volatile organic compounds in VOC 
Control Region 2 in grams per mile
VOCRF2=Refueling emissions of volatile organic compounds in VOC Control 
Region 2 in grams per mile

    (i) During Phase I:

VOCNE2=VOCDI2+VOCHS2 +VOCRL2+VOCRF2
VOCDI2=[0.006818  x  (RVP\2\)]-[0.07682  x  RVP]+0.2610
VOCHS2=[0.014421  x  (RVP\2\)]-[0.16248  x  RVP]+0.5520
VOCRL2=[0.016255  x  (RVP\2\)]-[0.1306  x  RVP]+0.2963
VOCRF2=[0.006668  x  RVP]-0.0180

    (ii) During Phase II:

VOCNE2=VOCDI2+VOCHS2+ VOCRL2+VOCRF2
VOCDI2=[0.004775  x  (RVP\2\)]-[0.05872  x  RVP]+0.21306
VOCHS2=[0.006078  x  (RVP\2\)]-[0.07474  x  RVP]+0.27117
VOCRL2=[0.016169  x  (RVP\2\)][0.17206  x  RVP]+0.56724
VOCRF2=[0.004767  x  RVP]+0.011859

    (5) Winter VOC emissions shall be given by VOCE, as defined in 
paragraph (c)(2) of this section, using the appropriate baseline 
emissions given in paragraph (b)(3) of this section. Total nonexhaust 
VOC emissions shall be set equal to zero under winter conditions.
    (6) Total VOC emissions. (i) Total summer VOC emissions shall be 
given by the following equations:

VOCS1=(VOCE/1000)+VOCNE1
VOCS2=(VOCE/1000)+VOCNE2
VOCS1=Total summer VOC emissions in VOC Control Region 1 in terms of 
grams per mile
VOCS2=Total summer VOC emissions in VOC Control Region 2 in terms of 
grams per mile

    (ii) Total winter VOC emissions shall be given by the following 
equations:

VOCW=(VOCE/1000)
VOCW=Total winter VOC emissions in terms of grams per mile

    (7) Phase I total VOC emissions performance. (i) The total summer 
VOC emissions performance of the target fuel in percentage terms from 
baseline levels shall be given by the following equations during Phase 
I:

VOCS1%=[100%  x  (VOCS1-1.306 g/mi)]/(1.306 g/mi)
VOCS2%=[100%  x  (VOCS2-1.215 g/mi)]/(1.215 g/mi)
VOC1%=Percentage change in VOC emissions from baseline levels in VOC 
Control Region 1
VOC2%=Percentage change in VOC emissions from baseline levels in VOC 
Control Region 2

    (ii) The total winter VOC emissions performance of the target fuel 
in percentage terms from baseline levels shall be given by the 
following equations during Phase I:

VOCW%=[100%  x  (VOCW-0.660 g/mi)]/(0.660 g/mi)
VOCW%=Percentage change in winter VOC emissions from baseline levels

    (8) Phase II total VOC emissions performance. (i) The total summer 
VOC emissions performance of the target fuel in percentage terms from 
baseline levels shall be given by the following equations during Phase 
II:

VOCS1%=[100%  x  (VOCS1-1.4663 g/mi)]/(1.4663 g/mi)
VOCS2%=[100%  x  (VOCS2-1.3991 g/mi)]/(1.3991 g/mi)

    (ii) The total winter VOC emissions performance of the target fuel 
in percentage terms from baseline levels shall be given by the 
following equation during Phase II:

VOCW%=[100%  x  (VOC-1.341 g/mi)]/(1.341 g/mi)

for

    (d) NOX performance. (1) The summer NOX emissions 
performance of gasolines shall be given by the following equations:

NOX=NOX(b)+[NOX(b)  x  Y(t)/100]
YNOX(t)=[(w1  x  Nn)+(w2  x  Hn)-1]  x  100

where

NOX=NOX emissions in milligrams/mile
YNOx(t)=NOX performance of target fuel in terms of percentage 
change from baseline
NOX(b)=Baseline NOX emissions as defined in paragraph (b)(2) 
of this section for the appropriate phase and season
Nn=exp n1(t)/exp n1(b)
Hn=exp n2(t)/exp n2(b)
w1=Weighting factor for normal emitters as defined in paragraph 
(b)(1) of this section for the appropriate Phase
w2=Weighting factor for higher emitters as defined in paragraph 
(b)(1) of this section for the appropriate Phase
n1(t)=Normal emitter NOX equation as defined in paragraph 
(d)(1)(i) of this section, evaluated using the target fuel's properties 
subject to paragraphs (d)(1)(iii) and (iv) of this section
n2(t)=Higher emitter NOX equation as defined in paragraph 
(d)(1)(ii) of this section, evaluated using the target fuel's 
properties subject to paragraphs (d)(1)(iii) and (iv) of this section
n1(b)=Normal emitter NOX equation as defined in paragraph 
(d)(1)(i) of this section, evaluated using the base fuel's properties
n2(b)=Higher emitter NOX equation as defined in paragraph 
(d)(1)(ii) of this section, evaluated using the base fuel's properties

    (i) Consolidated equation for normal emitters.

n1=(0.0018571 x OXY)+
    (0.0006921 x SUL)
    +(0.0090744 x RVP)+
    (0.0009310 x E200)+
    (0.0008460 x E300)+
    (0.0083632 x ARO)+
    (-0.002774 x OLE)+
    (-6.63X10-7 x SUL\2\)+
    (-0.000119 x ARO\2\)+
    (0.0003665 x OLE\2\)

    (ii) Equation for higher emitters.

n2=(-0.00913 x OXY)+
    (0.000252 x SUL)+
    (-0.01397 x RVP)
    +(0.000931 x E200)+
    (-0.00401 x E300)+
    (0.007097 x ARO)
    +(-0.00276 x OLE)
    +(0.0003665 x OLE\2\)+
    (-7.995x10-5 x ARO\2\)

    (iii) Flat line extrapolations. (A) During Phase I, fuels with 
olefin levels less than 3.77 volume percent shall be evaluated with the 
OLE fuel parameter set equal to 3.77 volume percent when calculating 
NOX performance using the equations described in paragraphs 
(d)(1)(i) and (ii) of this section. Fuels with aromatics levels greater 
than 36.2 volume percent shall be evaluated with the ARO fuel parameter 
set equal to 36.2 volume percent when calculating NOX performance 
using the equations described in paragraphs (d)(1)(i) and (ii) of this 
section.
    (B) During Phase II, fuels with olefin levels less than 3.77 volume 
percent shall be evaluated with the OLE fuel parameter set equal to 
3.77 volume percent when calculating NOX performance using the 
equations described in paragraphs (d)(1)(i) and (ii) of this section. 
Fuels with aromatics levels greater than 36.8 volume percent shall be 
evaluated with the ARO fuel parameter set equal to 36.8 volume percent 
when calculating NOX performance using the equations described in 
paragraphs (d)(1)(i) and (ii) of this section.
    (iv) Linear extrapolations. (A) The equations in paragraphs 
(d)(1)(i) and (ii) of this section shall be used within the allowable 
range of SUL, E300, OLE, and ARO for the appropriate Phase, as defined 
in the following Table 7:

Table 7.--Allowable Ranges of SUL, OLE, and ARO for the NOX Equations in
             Paragraphs (d)(1)(i) and (ii) of This Section              
------------------------------------------------------------------------
                                    Phase I               Phase II      
       Fuel parameter        -------------------------------------------
                               Low end    High end   Low end   High end 
------------------------------------------------------------------------
SUL.........................     10.0      450.0       10.0      450.0  
E300........................     70.0       95.0       70.0       95.0  
OLE.........................      3.77      19.0        3.77      19.0  
ARO.........................     18.0       36.2       18.0       36.8  
------------------------------------------------------------------------

    (B) For fuels with SUL, E300, OLE and ARO levels outside the ranges 
defined in Table 7 of paragraph (d)(1)(iv)(A) of this section, 
YNOx(t) shall be defined as:

For Phase I:

YNOx(t) = 100%  x  0.82  x  [exp(n1(et)) / exp(n1(b)) - 
1] + 100%  x  0.18  x  [exp(n2(et) / exp(n2(b)) - 1] + {[100% 
 x  0.82  x  [exp(n1(et)) / exp(n1(b))]  x  [{[(-0.00000133 
x  SULet) + 0.000692]  x  SUL} + {[(-0.000238  x  
AROet) + 0.0083632]  x  ARO} + {[(0.000733  x  
OLEet) - 0.002774]  x  OLE}]} + {[100%  x  0.18  x  
[exp(n2(et)) / exp(n2(b))]  x  [{[(-0.0001599  x  AROet) 
+ 0.007097]  x  ARO} + {[(0.000732  x  OLEet) - 0.00276] 
x  OLE}]}

For Phase II:

YNOx(t) = 100%  x  0.738  x  [exp(n1(et)) / exp(n1(b)) - 
1] + 100%  x  0.262  x  [exp(n2(et) / exp(n2(b)) - 1] + 
{[100%  x  0.738  x  [exp(n1(et)) / exp(n1(b))]  x  
[{[(-0.00000133  x  SULet) + 0.000692]  x  SUL} + 
{[(-0.000238  x  AROet) + 0.0083632]  x  ARO} + 
{[(0.000733  x  OLEet) - 0.002774]  x  OLE}]} + {[100% 
x  0.262  x  [exp(n2(et)) / exp(n2(b))]  x  [{[(-0.0001599 
x  AROet) + 0.007097]  x  ARO} + {[(0.000732  x  
OLEet) - 0.00276]  x  OLE}]}

where

n1, n2=The equations defined in paragraphs (d)(1) (i) and 
(ii) of this section.
et=Collection of fuel parameters for the ``edge target'' fuel. These 
parameters are defined in paragraphs (d)(1)(iv) (C) and (D) of this 
section.
n1(et)=The function n1 evaluated with ``edge target'' fuel 
parameters, which are defined in paragraph (d)(1)(iv)(C) of this 
section.
n2(et)=The function n2 evaluated with ``edge target'' fuel 
parameters, which are defined in paragraph (d)(1)(iv)(C) of this 
section.
n1(b)=The function n1 evaluated with the appropriate baseline 
fuel parameters defined in paragraph (b)(2) of this section.
n2(b)=The function n2 evaluated with the appropriate baseline 
fuel parameters defined in paragraph (b)(2) of this section.
SULet=The value of SUL for the ``edge target'' fuel, as defined in 
paragraph (d)(1)(iv)(C) of this section.
AROet=The value of ARO for the ``edge target'' fuel, as defined in 
paragraph (d)(1)(iv)(C) of this section.
OLEet=The value of OLE for the ``edge target'' fuel, as defined in 
paragraph (d)(1)(iv)(C) of this section.

    (C) For both Phase I and Phase II, the ``edge target'' fuel is 
identical to the target fuel for all fuel parameters, with the 
following exceptions:
    (1) If the sulfur level of the target fuel is less than 10 parts 
per million, then the value of SUL for the ``edge target'' fuel shall 
be set equal to 10 parts per million.
    (2) If the sulfur level of the target fuel is greater than 450 
parts per million, then the value of SUL for the ``edge target'' fuel 
shall be set equal to 450 parts per million.
    (3) If the aromatics level of the target fuel is less than 18 
volume percent, then the value of ARO for the ``edge target'' fuel 
shall be set equal to 18 volume percent.
    (4) If the olefins level of the target fuel is greater than 19 
volume percent, then the value of OLE for the ``edge target'' fuel 
shall be set equal to 19 volume percent.
    (5) If the E300 level of the target fuel is greater than 95 volume 
percent, then the value of E300 for the ``edge target'' fuel shall be 
equal to 95 volume percent.
    (6) If the sulfur level of the target fuel is less than 10 parts 
per million, then SUL shall be set equal to (SUL-10 parts per 
million).
    (7) If the sulfur level of the target fuel is greater than 450 
parts per million, then SUL shall be set equal to (SUL-450 
parts per million).
    (8) If the sulfur level of the target fuel is neither less than 10 
parts per million nor greater than 450 parts per million, SUL 
shall be set equal to zero.
    (9) If the aromatics level of the target fuel is less than 18 
volume percent and greater than 10 volume percent, then ARO 
shall be set equal to (ARO-18 volume percent). If the aromatics level 
of the target fuel is less than 10 volume percent, then ARO 
shall be set equal to 8 volume percent.
    (10) If the aromatics level of the target fuel is greater than or 
equal to 18 volume percent, then ARO shall be set equal to 
zero.
    (11) If the olefins level of the target fuel is greater than 19 
volume percent, then OLE shall be set equal to (OLE-19 volume 
percent).
    (12) If the olefins level of the target fuel is less than or equal 
to 19 volume percent, then OLE shall be set equal to zero.
    (2) The winter NOX emissions performance of gasolines shall be 
given by the equations presented in paragraph (d)(1) of this section 
with the RVP value set to 8.7 psi.
    (3) The NOX emissions performance of the target fuel in 
percentage terms from baseline levels shall be given by the following 
equations:

For Phase I:

Summer NOX%=[100%  x  (NOX-0.660 g/mi)]/(0.660 g/mi)
Winter NOX%=[100%  x  (NOX-0.750 g/mi)]/(0.750 g/mi)

For Phase II:

Summer NOX%=[100%  x  (NOX-1.340 g/mi)]/(1.340 g/mi)
Winter NOX%=[100%  x  (NOX-1.540 g/mi)]/(1.540 g/mi)
Summer NOX%=Percentage change in NOX emissions from summer 
baseline levels
Winter NOX%=Percentage change in NOX emissions from winter 
baseline levels

    (e) Toxics performance--(1) Summer toxics performance. (i) Summer 
toxic emissions performance of gasolines in VOC Control Regions 1 and 2 
shall be given by the following equations:

TOXICS1=EXHBZ + FORM + ACET + BUTA + POM + NEBZ1
TOXICS2=EXHBZ + FORM + ACET + BUTA + POM + NEBZ2

where

TOXICS1=Summer toxics performance in VOC Control Region 1 in terms of 
milligrams per mile.
TOXICS2=Summer toxics performance in VOC Control Region 2 in terms of 
milligrams per mile.
EXHBZ=Exhaust emissions of benzene in terms of milligrams per mile, as 
determined in paragraph (e)(4) of this section.
FORM=Emissions of formaldehyde in terms of milligrams per mile, as 
determined in paragraph (e)(5) of this section.
ACET=Emissions of acetaldehyde in terms of milligrams per mile, as 
determined in paragraph (e)(6) of this section.
BUTA=Emissions of 1,3-butadiene in terms of milligrams per mile, as 
determined in paragraph (e)(7) of this section.
POM=Polycyclic organic matter emissions in terms of milligrams per 
mile, as determined in paragraph (e)(8) of this section.
NEBZ1=Nonexhaust emissions of benzene in VOC Control Region 1 in 
milligrams per mile, as determined in paragraph (e)(9) of this section.
NEBZ2=Nonexhaust emissions of benzene in VOC Control Region 2 in 
milligrams per mile, as determined in paragraph (e)(10) of this 
section.

    (ii) The percentage change in summer toxics performance in VOC 
Control Regions 1 and 2 shall be given by the following equations:

For Phase I:

TOXICS1%=[100%  x  (TOXICS1-48.61 mg/mi)]/(48.61 mg/mi)
TOXICS2%=[100%  x  (TOXICS2-47.59 mg/mi)]/(47.59 mg/mi)

For Phase II:
TOXICS1%=[100%  x  (TOXICS1-86.35 mg/mi)]/(86.35 mg/mi)
TOXICS2%=[100%  x  (TOXICS2-85.61 mg/mi)]/(85.61 mg/mi)

where

TOXICS1%=Percentage change in summer toxics emissions in VOC Control 
Region 1 from baseline levels.
TOXICS2%=Percentage change in summer toxics emissions in VOC Control 
Region 2 from baseline levels.

    (2) Winter toxics performance. (i) Winter toxic emissions 
performance of gasolines in VOC Control Regions 1 and 2 shall be given 
by the following equation, evaluated with the RVP set at 8.7 psi:

TOXICW=[EXHBZ + FORM + ACET + BUTA + POM]

where

TOXICW=Winter toxics performance in VOC Control Regions 1 and 2 in 
terms of milligrams per mile.
EXHBZ=Exhaust emissions of benzene in terms of milligrams per mile, as 
determined in paragraph (e)(4) of this section.
FORM=Emissions of formaldehyde in terms of milligrams per mile, as 
determined in paragraph (e)(5) of this section.
ACET=Emissions of acetaldehyde in terms of milligrams per mile, as 
determined in paragraph (e)(6) of this section.
BUTA=Emissions of 1,3-butadiene in terms of milligrams per mile, as 
determined in paragraph (e)(7) of this section.
POM=Polycyclic organic matter emissions in terms of milligrams per 
mile, as determined in paragraph (e)(8) of this section.

    (ii) The percentage change in winter toxics performance in VOC 
Control Regions 1 and 2 shall be given by the following equation:

For Phase I:

TOXICW%=[100% x (TOXICW-58.36 mg/mi)] / (58.36 mg/mi)

For Phase II:

TOXICW%=[100% x (TOXICW-120.55 mg/mi)] / (120.55 mg/mi)

where

TOXICW%=Percentage change in winter toxics emissions in VOC Control 
Regions 1 and 2 from baseline levels.

    (3) Year-round toxics performance. (i) Year-round toxics 
performance in VOC Control Regions 1 and 2 shall be given by the 
following equation for reformulated and Clean Air Act baseline 
gasolines:

TOXICY1=[(0.396 x TOXICS1)+ (0.604 x TOXICW) ]
TOXICY2=[(0.396 x TOXICS2)+ (0.604 x TOXICW) ]

where

TOXICY1=Year-round toxics performance in VOC Control Region 1 in terms 
of milligrams per mile.
TOXICS1=Summer toxics performance in VOC Control Region 1 in terms of 
milligrams per mile, as determined in paragraph (e)(1)(i) of this 
section.
TOXICY2=Year-round toxics performance in VOC Control Region 2 in terms 
of milligrams per mile.
TOXICS2=Summer toxics performance in VOC Control Region 2 in terms of 
milligrams per mile, as determined in paragraph (e)(1)(i) of this 
section.
TOXICW=Winter toxics performance in VOC Control Regions 1 and 2 in 
terms of milligrams per mile, as determined in paragraph (e)(2)(i) of 
this section.

    (ii) The percentage change in year-round toxics performance in VOC 
Control Regions 1 and 2 shall be given by the following equations:

For Phase I:

TOXICY1%=[100% x (TOXICY1-54.50 mg/mi)] / (54.50 mg/mi)
TOXICY2%=[100% x (TOXICY2-54.09 mg/mi)] / (54.09 mg/mi)

For Phase II:

TOXICY1%=[100% x (TOXICY1-107.00 mg/mi)] / (107.00 mg/mi)
TOXICY2%=[100% x (TOXICY2-106.71 mg/mi)] / (106.71 mg/mi)
TOXICY1%=Percentage change in year-round toxics emissions in VOC 
Control Region 1 from baseline levels.
TOXICY2%=Percentage change in year-round toxics emissions in VOC 
Control Region 2 from baseline levels.

    (4) Exhaust benzene emissions shall be given by the following 
equation, subject to paragragh (e)(4)(iii) of this section:

EXHBZ=BENZ(b) + (BENZ(b)  x  YBEN(t)/100)
YBEN(t)=[(w1  x  Nb) + (w2  x  Hb) - 1]  x  
100

where

EXHBZ=Exhaust benzene emissions in milligrams/mile
YBEN(t)=Benzene performance of target fuel in terms of percentage 
change from baseline.
BENZ(b)=Baseline benzene emissions as defined in paragraph (b)(2) of 
this section for the appropriate phase and season.
Nb=exp b1(t)/exp b1(b)
Hb=exp b2(t)/exp b2(b)
w1=Weighting factor for normal emitters as defined in paragraph 
(b)(1) of this section for the appropriate Phase.
w2=Weighting factor for higher emitters as defined in paragraph 
(b)(1) of this section for the appropriate Phase.
b1(t)=Normal emitter benzene equation, as defined in paragraph 
(e)(4)(i) of this section, evaluated using the target fuel's properties 
subject to paragraph (e)(4)(iii) of this section.
b2(t)=Higher emitter benzene equation as defined in paragraph 
(e)(4)(ii) of this section, evaluated using the target fuel's 
properties subject to paragraph (e)(4)(iii) of this section.
b1(b)=Normal emitter benzene equation as defined in paragraph 
(e)(4)(i) of this section, evaluated for the base fuel's properties.
b2(b)=Higher emitter benzene equation, as defined in paragraph 
(e)(4)(ii) of this section, evaluated for the base fuel's properties.

    (i) Consolidated equation for normal emitters.
b1=(0.0006197 x SUL)+(-0.003376 x E200)+(0.0265500 x ARO)+(0.222390
0 x BEN)

    (ii) Equation for higher emitters.
b2=(-0.096047 x OXY)+(0.0003370 x SUL)+(0.0112510 x E300)+(0.011882
0 x ARO)+(0.2223180 x BEN)

    (iii) If the aromatics value of the target fuel is less than 10 
volume percent, then an aromatics value of 10 volume percent shall be 
used when evaluating the equations given in paragraphs (e)(4) (i) and 
(ii) of this section. If the E300 value of the target fuel is greater 
than 95 volume percent, then E300 value of 95 volume percent shall be 
used when evaluating the equations given in paragraphs (e)(4) (i) and 
(ii) of this section.
    (5) Formaldehyde mass emissions shall be given by the following 
equation, subject to paragraphs (e)(5) (iii) and (iv) of this section:

FORM=FORM(b)+(FORM(b) x YFORM(t)/100)
YFORM(t)=[(w1 x Nf)+(w2 x Hf)-1] x 100

where

FORM=Exhaust formaldehyde emissions in terms of milligrams/mile.
YFORM(t)=Formaldehyde performance of target fuel in terms of 
percentage change from baseline.
FORM(b)=Baseline formaldehyde emissions as defined in paragraph (b)(2) 
of this section for the appropriate Phase and season.
Nf=exp f1(t)/exp f1(b)
Hf=exp f2(t)/exp f2(b)
w1=Weighting factor for normal emitters as defined in paragraph 
(b)(1) of this section for the appropriate Phase.
w2=Weighting factor for higher emitters as defined in paragraph 
(b)(1) of this section for the appropriate Phase.
f1(t)=Normal emitter formaldehyde equation as defined in paragraph 
(e)(5)(i) of this section, evaluated using the target fuel's properties 
subject to paragraphs (e)(5) (iii) and (iv) of this section.
f2(t)=Higher emitter formaldehyde equation as defined in paragraph 
(e)(5)(ii) of this section, evaluated using the target fuel's 
properties subject to paragraphs (e)(5) (iii) and (iv) of this section.
f1(b)=Normal emitter formaldehyde equation as defined in paragraph 
(e)(5)(i) of this section, evaluated for the base fuel's properties.
f2(b)=Higher emitter formaldehyde equation as defined in paragraph 
(e)(5)(ii) of this section, evaluated for the base fuel's properties.

    (i) Consolidated equation for normal emitters.

f1=(-0.010226 x E300)+(-0.007166 x ARO)+(0.0462131 x MTB)

    (ii) Equation for higher emitters.

f2=(-0.010226 x E300)+(-0.007166 x ARO)+(-0.031352 x OLE)+(0.046213
1 x MTB)

(iii) If the aromatics value of the target fuel is less than 10 volume 
percent, then an aromatics value of 10 volume percent shall be used 
when evaluating the equations given in paragraphs (e)(5) (i) and (ii) 
of this section. If the E300 value of the target fuel is greater than 
95 volume percent, then an E300 value of 95 volume percent shall be 
used when evaluating the equations given in paragraphs (e)(5) (i) and 
(ii) of this section.
    (iv) When calculating formaldehyde emissions and emissions 
performance, oxygen in the form of alcohols which are more complex or 
have higher molecular weights than ethanol shall be evaluated as if it 
were in the form of ethanol. Oxygen in the form of methyl ethers other 
than TAME and MTBE shall be evaluated as if it were in the form of 
MTBE. Oxygen in the form of ethyl ethers other than ETBE shall be 
evaluated as if it were in the form of ETBE. Oxygen in the form of non-
methyl, non-ethyl ethers shall be evaluated as if it were in the form 
of ETBE.
    (6) Acetaldehyde mass emissions shall be given by the following 
equation, subject to paragraphs (e)(6) (iii) and (iv) of this section:

ACET=ACET(b)+(ACET(b) x YACET(t)/100)
YACET(t)=[(w1 x Na)+(w2 x Ha)-1] x 100

where

ACET=Exhaust acetaldehyde emissions in terms of milligrams/mile
YACET(t)=Acetaldehyde performance of target fuel in terms of 
percentage change from baseline
ACET(b)=Baseline acetaldehyde emissions as defined in paragraph (b)(2) 
of this section for the appropriate phase and season
Na=exp a1(t)/exp a1(b)
Ha=exp a2(t)/exp a2(b)
w1=Weighting factor for normal emitters as defined in paragraph 
(b)(1) of this section for the appropriate phase
w2=Weighting factor for higher emitters as defined in paragraph 
(b)(1) of this section for the appropriate phase
a1(t)=Normal emitter acetaldehyde equation as defined in paragraph 
(e)(6)(i) of this section, evaluated using the target fuel's 
properties, subject to paragraphs (e)(6) (iii) and (iv) of this section
a2(t)=Higher emitter acetaldehyde equation as defined in paragraph 
(e)(6)(ii) of this section, evaluated using the target fuel's 
properties, subject to paragraphs (e)(6) (iii) and (iv) of this section
a1(b)=Normal emitter acetaldehyde equation as defined in paragraph 
(e)(6)(i) of this section, evaluated for the base fuel's properties
f2(b)=Higher emitter acetaldehyde equation as defined in paragraph 
(e)(6)(ii) of this section, evaluated for the base fuel's properties

    (i) Consolidated equation for normal emitters.

a1=(0.0002631 x SUL)+ 
(0.0397860 x RVP)+(-0.012172 x E300)+(-0.005525 x ARO)+(-0.009594 x MTB)
+(0.3165800 x ETB)+(0.2492500 x ETH)

    (ii) Equation for higher emitters.

a2=(0.0002627 x SUL)+ 
(-0.012157 x E300)+(-0.005548 x ARO)+(-0.055980 x MTB)+(0.3164665 x ETB)
+(0.2493259 x ETH)

    (iii) If the aromatics value of the target fuel is less than 10 
volume percent, then an aromatics value of 10 volume percent shall be 
used when evaluating the equations given in paragraphs (e)(6) (i) and 
(ii) of this section. If the E300 value of the target fuel is greater 
than 95 volume percent, then an E300 value of 95 volume percent shall 
be used when evaluating the equations given in paragraphs (e)(6) (i) 
and (ii) of this section.
    (iv) When calculating acetaldehyde emissions and emissions 
performance, oxygen in the form of alcohols which are more complex or 
have higher molecular weights than ethanol shall be evaluated as if it 
were in the form of ethanol. Oxygen in the form of methyl ethers other 
than TAME and MTBE shall be evaluated as if it were in the form of 
MTBE. Oxygen in the form of ethyl ethers other than ETBE shall be 
evaluated as if it were in the form of ETBE. Oxygen in the form of non-
methyl, non-ethyl ethers shall be evaluated as if it were in the form 
of ETBE.
    (7) 1,3-butadiene mass emissions shall be given by the following 
equations, subject to paragraph (e)(7)(iii) of this section:

BUTA=BUTA(b)+(BUTA(b) x YBUTA(t)/100)
YBUTA(t)=[(w1 x Nd)+(w2 x Hd)-1] x 100

where

BUTA=Exhaust 1,3-butadiene emissions in terms of milligrams/mile
YBUTA(t)=1,3-butadiene performance of target fuel in terms of 
percentage change from baseline
BUTA(b)=Baseline 1,3-butadiene emissions as defined in paragraph (b)(2) 
of this section for the appropriate phase and season
Nd=exp d1(t)/exp d1(b)
Hd=exp d2(t)/exp d2(b)
w1=Weighting factor for normal emitters as defined in paragraph 
(b)(1) of this section for the appropriate phase
w2=Weighting factor for higher emitters as defined in paragraph 
(b)(1) of this section for the appropriate Phase.
d1(t)=Normal emitter 1,3-butadiene equation as defined in 
paragraph (e)(7)(i) of this section, evaluated using the target fuel's 
properties, subject to paragraph (e)(7)(iii) of this section.
d2(t)=Higher emitter 1,3-butadiene equation as defined in 
paragraph (e)(7)(ii) of this section, evaluated using the target fuel's 
properties, subject to paragraph (e)(7)(iii) of this section.
d1(b)=Normal emitter 1,3-butadiene equation as defined in 
paragraph (e)(7)(i) of this section, evaluated for the base fuel's 
properties.
d2(b)=Higher emitter 1,3-butadiene equation as defined in 
paragraph (e)(7)(ii) of this section, evaluated for the base fuel's 
properties.

    (i) Consolidated equation for normal emitters.

d1=(0.0001552 x SUL)+ 
(-0.007253 x E200)+(-0.014866 x E300)+(-0.004005 x ARO)+(0.0282350 x OLE
)

    (ii) Equation for higher emitters.

d2=(-0.060771 x OXY)+ 
(-0.007311 x E200)+(-0.008058 x E300)+(-0.004005 x ARO)+(0.0436960 x OLE
)

    (iii) If the aromatics value of the target fuel is less than 10 
volume percent, then an aromatics value of 10 volume percent shall be 
used when evaluating the equations given in paragraphs (e)(7) (i) and 
(ii) of this section. If the E300 value of the target fuel is greater 
than 95 volume percent, then an E300 value of 95 volume percent shall 
be used when evaluating the equations given in paragraphs (e)(7) (i) 
and (ii) of this section.
    (8) Polycyclic organic matter mass emissions shall be given by the 
following equation:

POM=0.003355 x VOCE
POM=Polycyclic organic matter emissions in terms of milligrams per mile
VOCE=Non-methane, non-ethane exhaust emissions of volatile organic 
compounds in grams per mile.

    (9) Nonexhaust benzene emissions in VOC Control Region 1 shall be 
given by the following equations for both Phase I and Phase II:

NEBZ1=DIBZ1+HSBZ1+RLBZ1+RFBZ1
HSBZ1=10  x  BEN  x  HSVOC1  x  [(-0.0342  x  MTB)+(-0.080274  x  
RVP)+1.4448]
DIBZ1=10  x  BEN  x  DIVOC1  x  [(-0.0290  x  MTB)+(-0.080274  x  
RVP)+1.3758]
RLBZ1=10  x  BEN  x  RLVOC1  x  [(-0.0342  x  MTB)+(-0.080274  x  
RVP)+1.4448]
RFBZ1=10  x  BEN  x  RFVOC1  x  [(-0.0296  x  MTB)+(-0.081507  x  
RVP)+1.3972]

where

NEBZ1=Nonexhaust emissions of volatile organic compounds in VOC Control 
Region 1 in milligrams per mile.
DIBZ1=Diurnal emissions of volatile organic compounds in VOC Control 
Region 1 in milligrams per mile.
HSBZ1=Hot soak emissions of volatile organic compounds in VOC Control 
Region 1 in milligrams per mile.
RLBZ1=Running loss emissions of volatile organic compounds in VOC 
Control Region 1 in milligrams per mile.
RFBZ1=Refueling emissions of volatile organic compounds in VOC Control 
Region 1 in grams per mile.
VOCDI1=Diurnal emissions of volatile organic compounds in VOC Control 
Region 1 in milligrams per mile, as determined in paragraph (c)(3) of 
this section.
VOCHS1=Hot soak emissions of volatile organic compounds in VOC Control 
Region 1 in milligrams per mile, as determined in paragraph (c)(3) of 
this section.
VOCRL1=Running loss emissions of volatile organic compounds in VOC 
Control Region 1 in milligrams per mile, as determined in paragraph 
(c)(3) of this section.
VOCRF1=Refueling emissions of volatile organic compounds in VOC Control 
Region 1 in milligrams per mile, as determined in paragraph (c)(3) of 
this section.

    (10) Nonexhaust benzene emissions in VOC Control Region 2 shall be 
given by the following equations for both Phase I and Phase II:

NEBZ2=DIBZ2+HSBZ2+RLBZ2+RFBZ2
HSBZ2=10  x BEN  x  HSVOC2  x  [(-0.0342  x  MTB)+(-0.080274  x  
RVP)+1.4448]
DIBZ2=10  x  BEN  x  DIVOC2  x  [(-0.0290  x  MTB)+(-0.080274  x  
RVP)+1.3758]
RLBZ2=10  x  BEN  x  RLVOC2  x  [(-0.0342  x  MTB)+(-0.080274  x  
RVP)+1.4448]
RFBZ2=10  x  BEN  x  RFVOC2  x  [(-0.0296  x  MTB)+(-0.081507  x  
RVP)+1.3972]

where

NEBZ2=Nonexhaust emissions of volatile organic compounds in VOC Control 
Region 2 in milligrams per mile.
DIBZ2=Diurnal emissions of volatile organic compounds in VOC Control 
Region 2 in milligrams per mile.
HSBZ2=Hot soak emissions of volatile organic compounds in VOC Control 
Region 2 in milligrams per mile.
RLBZ2=Running loss emissions of volatile organic compounds in VOC 
Control Region 2 in milligrams per mile.
RFBZ2=Refueling emissions of volatile organic compounds in VOC Control 
Region 2 in grams per mile.
VOCDI2=Diurnal emissions of volatile organic compounds in VOC Control 
Region 2 in milligrams per mile, as determined in paragraph (c)(4) of 
this section.
VOCHS2=Hot soak emissions of volatile organic compounds in VOC Control 
Region 2 in milligrams per mile, as determined in paragraph (c)(4) of 
this section.
VOCRL2=Running loss emissions of volatile organic compounds in VOC 
Control Region 2 in milligrams per mile, as determined in paragraph 
(c)(4) of this section.
VOCRF2=Refueling emissions of volatile organic compounds in VOC Control 
Region 2 in milligrams per mile, as determined in paragraph (c)(4) of 
this section.

    (f) Limits of the model. (1) The equations described in paragraphs 
(a), (c), and (d) of this section shall be valid only for fuels with 
fuel properties that fall in the following ranges for reformulated 
gasolines and conventional gasolines:
    (i) For reformulated gasolines: 

------------------------------------------------------------------------
   Fuel property                       Acceptable range                 
------------------------------------------------------------------------
Oxygen..............  0.00-3.70 weight percent.                         
Sulfur..............  0.0-500.0 parts per million by weight.            
RVP.................  6.4-10.0 pounds per square inch.                  
E200................  30.0-70.0 volume percent.                         
E300................  70.0-100.0 volume percent.                        
Aromatics...........  0.0-50.0 volume percent.                          
Olefins.............  0.00-25.0 volume percent.                         
Benzene.............  0.0-2.0 volume percent.                           
------------------------------------------------------------------------

    (ii) For conventional gasolines: 

------------------------------------------------------------------------
   Fuel property                       Acceptable range                 
------------------------------------------------------------------------
Oxygen..............  0.00-3.70 weight percent.                         
Sulfur..............  0.0-1000.0 parts per million by weight.           
RVP.................  6.4-11.0 pounds per square inch.                  
E200................  30.0-70.0 volume percent.                         
E300................  70.0-100.0 volume percent.                        
Aromatics...........  00.0-55.0 volume percent.                         
Olefins.............  0.00-30.0 volume percent.                         
Benzene.............  0.0-4.9 volume percent.                           
------------------------------------------------------------------------

    (2) Fuels with one or more properties that do not fall within the 
ranges described in above shall not be certified or evaluated for their 
emissions performance using the complex emissions model described in 
paragraphs (c), (d), and (e) of this section.


Sec. 80.46  Measurement of reformulated gasoline fuel parameters.

    (a) Sulfur. Sulfur content shall be determined using American 
Society for Testing and Materials (ASTM) standard method D-2622-92, 
entitled ``Standard Test Method for Sulfur in Petroleum Products by X-
Ray Spectrometry.''
    (b) Olefins. Olefin content shall be determined using ASTM standard 
method D-1319-93, entitled ``Standard Test Method for Hydrocarbon Types 
in Liquid Petroleum Products by Fluorescent Indicator Adsorption.''
    (c) Reid vapor pressure (RVP). Reid Vapor Pressure (RVP) shall be 
determined using the procedure described in 40 CFR part 80, appendix E, 
Method 3.
    (d) Distillation. (1) Distillation parameters shall be determined 
using ASTM standard method D-86-90, entitled ``Standard Test Method for 
Distillation of Petroleum Products''; except that
    (2) The figures for repeatability and reproducibility given in 
degrees Fahrenheit in Table 9 in the ASTM method are incorrect, and 
shall not be used.
    (e) Benzene. (1) Benzene content shall be determined using ASTM 
standard method D-3606-92, entitled ``Standard Test Method for 
Determination of Benzene and Toluene in Finished Motor and Aviation 
Gasoline by Gas Chromatography''; except that
    (2) Instrument parameters must be adjusted to ensure complete 
resolution of the benzene, ethanol and methanol peaks because ethanol 
and methanol may cause interference with ASTM standard method D-3606-92 
when present.
    (f) Aromatics. Aromatics content shall be determined by gas 
chromatography identifying and quantifying each aromatic compound as 
set forth in paragraph (f)(1) of this section.
    (1) (i) Detector. The detector is an atomic mass spectrometer 
detector (MSD). The detector may be set for either selective ion or 
scan mode.
    (ii) Method A. (A) The initial study of this method used a three 
component internal standard using the following calculations.
    (B) The calibration points are constructed by calculating an amount 
ratio and response ratio for each level of a particular peak in the 
instrument's calibration table.
    (C) The amount ratio is the amount of the compound divided by the 
amount of the internal standard for a given level.
    (D) The response ratio is the response of the compound divided by 
the response of the internal standard at this level.
    (E) The equation for the curve through the calibration points is 
calculated using the type fit and origin handling specified in the 
instrument's calibration table. In the initial study the fit was a 
second degree polynomial including a forced zero for the origin.
    (F) The response of the compound in a sample is divided by the 
response of the internal standard to provide a response ratio for that 
compound in the sample.
    (G) A corrected amount ratio for the unknown is calculated using 
the curve fit equation determined in paragragh (f)(1)(ii)(E) of this 
section.
    (H) The amount of the aromatic compound is equal to the corrected 
amount ratio times the Amount of Internal Standard.
    (I) The total aromatics in the sample is the sum of the amounts of 
the individual aromatic compounds in the sample.
    (J) An internal standard solution can be made with the following 
compounds at the listed concentrations in volume percent. Also listed 
is the Chemical Abstracts Service Registry Number (CAS), atomic mass 
unit (amu) on which the detector must be set at the corresponding 
retention time if used in the selective ion mode, retention times in 
minutes, and boiling point in  deg.C. (Other, similar, boiling point 
materials can be used which are not found in gasoline.) Retention times 
are approximate and apply only to a 60 meter capillary column used in 
the initial study. Other columns and retention times can be used.
    (1) 4-methyl-2-pentanone, 50 vol% [108-10-1], 43.0 amu, 22.8 min., 
bp 118;
    (2) benzyl alcohol, 25 vol%, [100-51-6], 108 amu, 61.7 min., bp 
205;
    (3) 1-octanol, [111-87-5], 25 vol%, 56.0 amu, 76.6 min., bp 196;
    (K) At least two calibration mixtures which bracket the measured 
total aromatics concentration must be made with a representative 
mixture of aromatic compounds. The materials and concentrations used in 
the highest concentration calibration level in the initial study for 
this method are listed in this paragraph (f)(1)(ii)(K). Also listed is 
the Chemical Abstracts Service Registry Number (CAS), atomic mass unit 
(amu) on which the detector must be set for the corresponding retention 
time if used in the selective ion mode, retention times in minutes, and 
in some cases boiling point in  deg.C. The standards are made in 2,2,4-
trimethylpentane (iso-octane), [540-84-1]. Other aromatic compounds, 
and retention times may be acceptable as long as the aromatic values 
produced meet the criteria found in the quality assurance section for 
the aromatic methods.

----------------------------------------------------------------------------------------------------------------
                                                                                                       Boiling  
                  Compound                    Concentrations      CAS No.       AMU     Retention      point,   
                                                   vol %                                time, min.     deg.C    
----------------------------------------------------------------------------------------------------------------
Benzene.....................................          2.25           71-43-2       78         18.9          80.1
Methylbenzene...............................           2.5          108-88-3       91         25.5         111  
Ethylbenzene................................          2.25          100-41-4       91         34.1         136.2
1,3-Dimethylbenzene 1,4-Dimethylbenzene.....             5          108-38-3       91         35.1     136-138  
1,2-dimethylbenzene.........................            10           95-47-6       91         38.1         144  
(1-methylethyl)-benzene.....................          2.25          620-14-4      105         42.8  ............
Propylbenzene...............................          2.25          103-65-1       91         48.0         159.2
1-ethyl-2-methylbenzene.....................          2.25          611-14-3      105         49.3         165  
1,2,4-trimethylbenzene......................          2.25           95-63-6      105         50.9         169  
1-ethyl-2-methylbenzene.....................          2.25          611-14-4      105         53.3         165  
1,3-diethylbenzene..........................          2.25          141-93-5      119         56.6         181  
Butylbenzene................................          2.25          104-51-8       91         60.7         183  
1-methyl-2-(1-methylethyl)-benzene..........          2.25          933-98-2      119         63.9  ............
1-ethyl-3-methylbenzene.....................          2.25          620-14-4      105         64.2  ............
1-methyl-4-iso-propylbenzene................          2.25           99-87-6      119         69.0         177  
2-ethyl-1,3-dimethylbenzene.................          2.25         2870-04-4      119         73.0  ............
2-methylpropylbenzene.......................          2.25          538-93-2       91         75.0  ............
1-methyl-3-(1-methylethyl)-benzene..........          2.25          535-77-3      119         75.6  ............
1-methyl-3-propylbenzene....................          2.25         1074-43-7      105         78.9  ............
2-ethyl-1,4-dimethylbenzene.................          2.25         1758-88-9      119         83.2         187  
1-methyl-4-(methylethyl)-benzene............          2.25          934-80-9      119         83.4  ............
1-ethyl-2,4-dimethylbenzene.................          2.25          874-41-9      119         85.7  ............
(1,1-dimethylethy)-3-methylbenzene..........          2.25        27138-21-2      133         87.3  ............
1-ethyl-2,3-dimethylbenzene.................          2.25          933-98-2      119         88.7  ............
1-(1,1-dimethylethyl)-3-methylbenzene.......          2.25          175-38-3      133         89.4  ............
1-ethyl-1,4-dimethylbenzene.................          2.25          874-41-9      119         94.9  ............
2-ethyl-1,3-dimethylbenzene.................          2.25         2870-04-4      119        100.9  ............
1-ethyl-3,5-dimethylbenzene.................          2.25          934-74-7      119        102.5  ............
1-2,4,5-tetramethylbenzene..................          2.25           95-93-2      119        115.9         197  
Pentylbenzene...............................          2.25          538-68-1       91          116  ............
Naphthalene.................................          2.25          191-20-3      128        118.4         198  
3,5 dimethyl-iso-butylbenzene...............          2.25           98-19-1      147        118.5         205.5
----------------------------------------------------------------------------------------------------------------

    (iii) Method B. (A) Use a percent normalized format to determine 
the concentration of the individual compounds. No internal standard is 
used in this method.
    (B) The calculation of the aromatic compounds is done by developing 
calibration curves for each compound using the type fit and origin 
handling specified in the instrument's calibration table.
    (C) The amount of compound in a sample (the corrected amount) is 
calculated using the equation determined in paragraph (f)(1)(ii) of 
this section for that compound.
    (D) The percent normalized amount of a compound is calculated using 
the following equation:

TR16FE94.001

where:

An = percent normalized amount of a compound
Ac = corrected amount of the compound
As = sum of all the corrected amounts for all identified compounds 
in the sample

    (E) The total aromatics is the sum of all the percent normalized 
aromatic amounts in the sample.
    (F) This method allows quantification of non-aromatic compounds in 
the sample. However, correct quantification can only be achieved if the 
instrument's calibration table can identify the compounds that are 
responsible for at least 95 volume percent of the sample and meets the 
following quality control criteria.
    (2) Quality assurance. (i) The performance standards will be from 
repeated measurement of the calibration mixture, standard reference 
material, or process control gasoline. The uncertainty in the measured 
aromatics percentages in the standards must be less than 2.0 volume 
percent in the fuel at a 95% confidence level.
    (ii) If the bias of the standard mean is greater than 2% of the 
theoretical value, then the standard measurement and measurements of 
all samples measured subsequent to the previous standard measurement 
that met the performance criteria must be repeated after re-calibrating 
the instrument.
    (iii) Replicate samples must be within 3.0 volume percent of the 
previous sample or within 2.0 volume percent of the mean at the 95% 
confidence level.
    (3) Alternative test method. (i) Prior to January 1, 1997, any 
refiner or importer may determine aromatics content using ASTM standard 
method D-1319-93, entitled ``Standard Test Method for Hydrocarbon Types 
in Liquid Petroleum Products by Fluorescent Indicator Adsorption,'' for 
purposes of meeting any testing requirement involving aromatics 
content; provided that
    (ii) The refiner or importer test result is correlated with the 
method specified in paragraph (f)(1) of this section.
    (g) Oxygen and oxygenate content analysis. Oxygen and oxygenate 
content shall be determined by the gas chromatographic procedure using 
an oxygenate flame ionization detector (GC-OFID) as set out in 
paragraphs (g) (1) through (8) of this section.
    (1) Introduction; scope of application.  (i) The following single-
column, direct-injection gas chromatographic procedure is a technique 
for quantifying the oxygenate content of gasoline.
    (ii) This method covers the quantitative determination of the 
oxygenate content of gasoline through the use of an oxygenate flame 
ionization detector (OFID). It is applicable to individual organic 
oxygenated compounds (up to 20 mass percent each) in gasoline having a 
final boiling point not greater than 220  deg.C. Samples above this 
level should be diluted to fall within the specified range.
    (iii) The total concentration of oxygen in the gasoline, due to 
oxygenated components, may also be determined with this method by 
summation of all peak areas except for dissolved oxygen, water, and the 
internal standard. Sensitivities to each component oxygenate must be 
incorporated in the calculation.
    (iv) All oxygenated gasoline components (alcohols, ethers, etc.) 
may be assessed by this method.
    (v) The total mass percent of oxygen in the gasoline due to 
oxygenated components also may be determined with this method by 
summing all peak areas except for dissolved oxygen, water, and the 
internal standard.
    (vi) Where trade names or specific products are noted in the 
method, equivalent apparatus and chemical reagents may be used. Mention 
of trade names or specific products is for the assistance of the user 
and does not constitute endorsement by the U.S. Environmental 
Protection Agency.
    (2) Summary of method. A sample of gasoline is spiked to introduce 
an internal standard, mixed, and injected into a gas chromatograph (GC) 
equipped with an OFID. After chromatographic resolution the sample 
components enter a cracker reactor in which they are stoichiometrically 
converted to carbon monoxide (in the case of oxygenates), elemental 
carbon, and hydrogen. The carbon monoxide then enters a methanizer 
reactor for conversion to water and methane. Finally, the methane 
generated is determined by a flame ionization detector (FID).
    (3) Sample handling and preservation. (i) Samples shall be 
collected and stored in containers which will protect them from changes 
in the oxygenated component contents of the gasoline, such as loss of 
volatile fractions of the gasoline by evaporation.
    (ii) If samples have been refrigerated they shall be brought to 
room temperature prior to analysis.
    (iii) Gasoline is extremely flammable and should be handled 
cautiously and with adequate ventilation. The vapors are harmful if 
inhaled and prolonged breathing of vapors should be avoided. Skin 
contact should be minimized.
    (4) Apparatus. (i) A GC equipped with an oxygenate flame ionization 
detector.
    (ii) An autosampler for the GC is highly recommended.
    (iii) A 60-m length, 0.25-mm ID, 1.0-m film thickness, 
nonpolar capillary GC column (J&W DB-1 or equivalent) is recommended.
    (iv) An integrator or other acceptable system to collect and 
process the GC signal.
    (v) A positive displacement pipet (200 L) for adding the 
internal standard.
    (5) Reagents and materials. Gasoline and many of the oxygenate 
additives are extremely flammable and may be toxic over prolonged 
exposure. Methanol is particularly hazardous. Persons performing this 
procedure must be familiar with the chemicals involved and all 
precautions applicable to each.
    (i) Reagent grade oxygenates for internal standards and for 
preparation of standard solutions.
    (ii) Supply of oxygenate-free gasoline for blank assessments and 
for preparation of standard solutions.
    (iii) Calibration standard solutions containing known quantities of 
suspected oxygenates in gasoline.
    (iv) Calibration check standard solutions prepared in the same 
manner as the calibration standards.
    (v) Reference standard solutions containing known quantities of 
suspected oxygenates in gasoline.
    (vi) Glass standard and test sample containers (between 5 and 100 
Ml capacity) fitted with a self-sealing polytetrafluoroethlene (PTFE) 
faced rubber septum crimp-on or screw-down sealing cap for preparation 
of standards and samples.
    (6) Calibration.--(i)(A) Calibration standards of reagent-grade or 
better oxygenates (such as methanol, absolute ethanol, methyl t-butyl 
ether (MTBE), di-i-propyl ether (DIPE), ethyl t-butyl ether (ETBE), and 
t-amyl methyl ether (TAME)) are to be prepared gravimetrically by 
blending with gasoline that has been previously determined by GC/OFID 
to be free of oxygenates. Newly acquired stocks of reagent grade 
oxygenates shall be analyzed for contamination by GC/FID and GC/OFID 
before use.
    (B) Required calibration standards (percent by volume in gasoline): 


------------------------------------------------------------------------
                                                               Number of
                                                    Range      standards
                  Oxygenate                      (percent)     (minimum)
                                                                        
------------------------------------------------------------------------
Methanol.....................................      0.25-12.00          5
Ethanol......................................      0.25-12.00          5
t-Butanol....................................      0.25-12.00          5
MTBE.........................................      0.25-15.00         5 
------------------------------------------------------------------------

    (ii) Take a glass sample container and its PTFE faced rubber septum 
sealing cap. Transfer a quantity of an oxygenate to the sample 
container and record the mass of the oxygenate to the nearest 0.1 mg. 
Repeat this process for any additional oxygenates of interest except 
the internal standard. Add oxygenate-free gasoline to dilute the 
oxygenates to the desired concentration. Record the mass of gasoline 
added to the nearest 0.1 mg, and determine and label the standard 
according to the mass percent quantities of each oxygenate added. These 
standards are not to exceed 20 mass percent for any individual pure 
component due to potential hydrocarbon breakthrough and/or loss of 
calibration linearity.
    (iii) Inject a quantity of an internal standard (such as 2-butanol) 
and weigh the contents again. Record the difference in masses as the 
mass of internal standard to the nearest 0.1 mg. The mass of the 
internal standard shall amount to between 2 and 6 percent of the mass 
of the test sample (standard). The addition of an internal standard 
reduces errors caused by variations in injection volumes.
    (iv) Ensure that the prepared standard is thoroughly mixed and 
transfer approximately 2 Ml of the solution to a vial compatible with 
the autosampler if such equipment is used.
    (v) At least five concentrations of each of the expected oxygenates 
should be prepared. The standards should be as equally spaced as 
possible within the range and may contain more than one oxygenate. A 
blank for zero concentration assessments is also to be included. 
Additional standards should be prepared for other oxygenates of 
concern.
    (vi) Based on the recommended chromatographic operating conditions 
specified in paragraph (g)(7)(i) of this section, determine the 
retention time of each oxygenate component by analyzing dilute aliquots 
either separately or in known mixtures. Reference should be made to the 
Chemical Abstracts Service (CAS) registry number of each of the 
analytes for proper identification. Approximate retention times for 
selected oxygenates under these conditions are as follows: 

------------------------------------------------------------------------
                                                               Retention
                                                                  time  
                  Oxygenate                         CAS        (minutes)
                                                                        
------------------------------------------------------------------------
Dissolved oxygen.............................       7782-44-7      5.50 
Water........................................       7732-18-5      7.20 
Methanol.....................................         67-56-1      9.10 
Ethanol......................................         64-17-5     12.60 
Propanone....................................         67-64-1     15.00 
2-Propanol...................................         67-63-0     15.70 
t-Butanol....................................         75-65-0     18.00 
n-Propanol...................................         71-23-8     21.10 
MTBE.........................................       1634-04-4     23.80 
2-Butanol....................................      15892-23-6     26.30 
i-Butanol....................................         78-83-1     30.30 
ETBE.........................................        637-92-3     31.10 
n-Butanol....................................         71-36-3     33.50 
TAME.........................................        994-05-8     35.30 
i-Pentanol...................................        137-32-6    38.10  
------------------------------------------------------------------------

    (vii) By GC/OFID analysis, determine the peak area of each 
oxygenate and of the internal standard.
    (viii) Obtain a calibration curve by performing a least-squares fit 
of the relative area response factors of the oxygenate standards to 
their relative mass response factors as follows:

Rao=boRmo+b1(Rmo)2

where:

Rao = relative area response factor of the oxygenate, Ao/
Ai
Rmo = relative mass response factor of the oxygenate, M/
Mi
Ao = area of the oxygenate peak
Ai = area of the internal standard peak
Mo = mass of the oxygenate added to the calibration standard
Mi = mass of internal standard added to the calibration standard
b0 = linear regression coefficient
b1 = quadratic regression coefficient

    (7) Procedure. (i) GC operating conditions:
    (A) Oxygenate-free helium carrier gas: 1.1 Ml/min (2 bar), 22.7 cm/
sec at 115  deg.C;
    (B) Carrier gas split ratio: 1:100;
    (C) Zero air FID fuel: 370 Ml/min (2 bar);
    (D) Oxygenate free hydrogen FID fuel: 15 Ml/min (2 bar);
    (E) Injector temperature: 250  deg.C;
    (F) Injection volume: 0.5 L;
    (G) Cracker reactor temperature: sufficiently high enough 
temperature to ensure reduction of all hydrocarbons to the elemental 
states (i.e., CxH2x -> C + H2, etc.);
    (H) FID temperature: 400  deg.C; and
    (I) Oven temperature program: 40  deg.C for 6 min, followed by a 
temperature increase of 5  deg.C/min to 50  deg.C, hold at 50  deg.C 
for 5 min, followed by a temperature increase of 25  deg.C/min to 175 
deg.C, and hold at 175  deg.C for 2 min.
    (ii) Prior to analysis of any samples, inject a sample of 
oxygenate-free gasoline into the GC to test for hydrocarbon 
breakthrough overloading the cracker reactor. If breakthrough occurs, 
the OFID is not operating effectively and must be corrected before 
samples can be analyzed.
    (iii) Prepare gasoline test samples for analysis as follows:
    (A) Tare a glass sample container and its PTFE faced rubber septum 
sealing cap. Transfer a quantity of the gasoline sample to the sample 
container and record the mass of the transferred sample to the nearest 
0.1 mg.
    (B) Inject a quantity of the same internal standard (such as 2-
butanol) used in generating the standards and weigh the contents again. 
Record the difference in masses as the mass of internal standard to the 
nearest 0.1 mg. The mass of the internal standard shall amount to 
between 2 and 6 percent of the mass of the test sample (standard). The 
addition of an internal standard reduces errors caused by variations in 
injection volumes.
    (C) Ensure that this test sample (gasoline plus internal standard) 
is thoroughly mixed and transfer approximately 2 mL of the solution to 
a vial compatible with the autosampler if such equipment is used.
    (iv) After GC/OFID analysis, identify the oxygenates in the sample 
based on retention times, determine the peak area of each oxygenate and 
of the internal standard, and calculate the relative area response 
factor for each oxygenate.
    (v) Monitor the peak area of the internal standard. A larger than 
expected peak area for the internal standard when analyzing a test 
sample may indicate that this oxygenate is present in the original 
sample. Prepare a new aliquot of the sample without addition of the 
oxygenate internal standard. If the presence of the oxygenate 
previously used as the internal standard can be detected, then either:
    (A) The concentration of this oxygenate must be assessed by the 
method of standard additions; or
    (B) An alternative internal standard, based on an oxygenate that is 
not present in the original sample, must be utilized with new 
calibration curves.
    (vi) Calculate the relative mass response factor (Rmo) for 
each oxygenate based on the relative area response factor (Rao) 
and the calibration equation in paragraph (g)(6)(viii) of this section.
    (vii) Calculate the mass percent of the oxygenate in the test 
sample according to the following equation:

TR16FE94.002

where:

Mo% = mass percent of the oxygenate in the test sample
Ms = mass of sample to which internal standard is added

    (viii) If the mass percent exceeds the calibrated range, 
gravimetrically dilute a portion of the original sample to a 
concentration within the calibration range and analyze this sample 
starting with paragraph (g)(7)(iii) of this section.
    (ix) Report the total weight percent oxygen as follows:
    (A) Subtract the peak areas due to dissolved oxygen, water, and the 
internal standard from the total summed peak areas of the chromatogram.
    (B) Assume the total summed peak area solely due to one of the 
oxygenates that the instrument is calibrated for and determine the 
total mass percent as that oxygenate based on paragraph (g)(7)(vii) of 
this section. For simplicity, chose an oxygenate having one oxygen atom 
per molecule.
    (C) Multiply this concentration by the molar mass of oxygen and 
divide by the molar mass of the chosen oxygenate to determine the mass 
percent oxygen in the sample. For example, if the total peak area is 
based on MTBE, multiply by 16.00 (the molar mass of atomic oxygen) and 
divide by 88.15 (the molar mass of MTBE).
    (x) Sufficient sample should be retained to permit reanalysis.
    (8) Quality control procedures and accuracy. (i) The laboratory 
shall routinely monitor the repeatability (precision) of its analyses. 
The recommendations are:
    (A) The preparation and analysis of laboratory duplicates at a rate 
of one per analysis batch or at least one per ten samples, whichever is 
more frequent.
    (B) Laboratory duplicates shall be carried through all sample 
preparation steps independently.
    (C) The range (R) for duplicate samples should be less than the 
following limits: 

------------------------------------------------------------------------
                                     Concentration     Upper limit for  
             Oxygenate               mass percent    range mass percent 
------------------------------------------------------------------------
Methanol...........................     0.27-1.07   0.010+0.043C        
Methanol...........................    1.07-12.73   0.053C              
Ethanol............................    1.01-12.70   0.053C              
MTBE...............................    0.25-15.00   0.069+0.029C        
DIPE...............................    0.98-17.70   0.048C              
ETBE...............................    1.00-18.04   0.074C              
TAME...............................    1.04-18.59   0.060C              
------------------------------------------------------------------------

where:

C=(Co+Cd)/2
Co=concentration of the original sample
Cd=concentration of the duplicate sample
R=Range, |Co-Cd|

    (D) If the limits in paragraph (g)(8)(i)(C) of this section are 
exceeded, the sources of error in the analysis should be determined, 
corrected, and all analyses subsequent to and including the last 
duplicate analysis confirmed to be within the compliance specifications 
must be repeated. The specification limits for the range and relative 
range of duplicate analyses are minimum performance requirements. The 
performance of individual laboratories may indeed be better than these 
minimum requirements. For this reason it is recommended that control 
charts be utilized to monitor the variability of measurements in order 
to optimally detect abnormal situations and ensure a stable measurement 
process.
    (E) (1) For reference purposes, a single laboratory study of 
repeatability was conducted on approximately 27 replicates at each of 
five concentrations for each oxygenate. The variation of MTBE analyses 
as measured by standard deviation was very linear with respect to 
concentration. Where concentration is expressed as mass percent, over 
the concentration range of 0.25 to 15.0 mass percent this relationship 
is described by the equation:

standard deviation=0.00784 x C+0.0187

    (2) The other oxygenates of interest, methanol, ethanol, DIPE, 
ETBE, and TAME, had consistent coefficients of variation at one mass 
percent and above: 

------------------------------------------------------------------------
                                                             Coefficient
                                                                  of    
                 Oxygenate                    Concentration   variation 
                                              mass percent    percent of
                                                                point   
------------------------------------------------------------------------
Methanol...................................      1.07-12.73       1.43  
Ethanol....................................      1.01-12.70       1.43  
DIPE.......................................      0.98-17.70       1.29  
ETBE.......................................      1.00-18.04       2.00  
TAME.......................................      1.04-18.59      1.62   
------------------------------------------------------------------------

    (3) The relationship of standard deviation and concentration for 
methanol between 0.27 and 1.07 mass percent was very linear and is 
described by the equation:

standard deviation=0.0118 x C+0.0027

    (4) Based on these relationships, repeatability for the selected 
oxygenates at 2.0 and 2.7 mass percent oxygen were determined to be as 
follows, where repeatability is defined as the half width of the 95 
percent confidence interval (i.e., 1.96 standard deviations) for a 
single analysis at the stated concentration: 

------------------------------------------------------------------------
                                    Concentration                       
                          --------------------------------              
                                        Mass               Repeatability
        Oxygenate            Mass     percent     Volume    mass percent
                            percent  oxygenate   percent                
                            oxygen              oxygenate               
------------------------------------------------------------------------
Methanol.................      2.0       4.00       3.75         0.11   
Ethanol..................      2.0       5.75       5.41         0.16   
MTBE.....................      2.00     11.00      11.00         0.21   
DIPE.....................      2.0      12.77      13.00         0.32   
ETBE.....................      2.0      12.77      12.74         0.50   
TAME.....................      2.0      12.77      12.33         0.41   
Methanol.................      2.7       5.40       5.07         0.15   
Ethanol..................      2.7       7.76       7.31         0.21   
MTBE.....................      2.7      14.88      14.88         0.26   
DIPE.....................      2.7      17.24      17.53         0.43   
ETBE.....................      2.7      17.24      17.20         0.67   
TAME.....................      2.7      17.24      16.68         0.55   
------------------------------------------------------------------------

    (ii) The laboratory shall routinely monitor the accuracy of its 
analyses. The recommendations are:
    (A) Calibration check standards and calibration standards may be 
prepared from the same oxygenate stocks and by the same analyst. 
However, calibration check standards and calibration standards must be 
prepared from separate batches of the final diluted standards. For the 
specification limits listed in paragraph (g)(8)(ii)(C) of this section, 
the concentration of the check standards should be in the range given 
in paragraph (g)(8)(i)(C) of this section.
    (B) Calibration check standards shall be analyzed at a rate of at 
least one per analysis batch and at least one per 10 samples, whichever 
is more frequent.
    (C) If the measured concentration of a calibration check standard 
is outside the range of 100.0% 6.0% of the theoretical 
concentration for a selected oxygenate of 1.0 mass percent or above, 
the sources of error in the analysis should be determined, corrected, 
and all analyses subsequent to and including the last standard analysis 
confirmed to be within the compliance specifications must be repeated. 
The specification limits for the accuracy of calibration check 
standards analyses are minimum performance requirements. The 
performance of individual laboratories may indeed be better than these 
minimum requirements. For this reason it is recommended that control 
charts be utilized to monitor the variability of measurements in order 
to optimally detect abnormal situations and ensure a stable measurement 
process.
    (D) Independent reference standards should be purchased or prepared 
from materials that are independent of the calibration standards and 
calibration check standards, and must not be prepared by the same 
analyst. For the specification limits listed in paragraph (g)(8)(ii)(F) 
of this section, the concentration of the reference standards should be 
in the range given in paragraph (g)(8)(i)(C) of this section.
    (E) Independent reference standards shall be analyzed at a rate of 
at least one per analysis batch and at least one per 100 samples, 
whichever is more frequent.
    (F) If the measured concentration of an independent reference 
standard is outside the range of 100.0% 10.0% of the 
theoretical concentration for a selected oxygenate of 1.0 mass percent 
or above, the sources of error in the analysis should be determined, 
corrected, and all analyses subsequent to and including the last 
independent reference standard analysis confirmed to be within the 
compliance specifications in that batch must be repeated. The 
specification limits for the accuracy of independent reference 
standards analyses are minimum performance requirements. The 
performance of individual laboratories may be better than these minimum 
requirements. For this reason it is recommended that control charts be 
utilized to monitor the variability of measurements in order to 
optimally detect abnormal situations and ensure a stable measurement 
process.
    (G) The preparation and analysis of spiked samples at a rate of one 
per analysis batch and at least one per ten samples.
    (H) Spiked samples shall be prepared by adding a volume of a 
standard to a known volume of sample. To ensure adequate method 
detection limits, the volume of the standard added to the sample shall 
be limited to 5% or less than the volume of the sample. The spiked 
sample shall be carried through the same sample preparation steps as 
the background sample.
    (I) The percent recovery of the spiked sample shall be calculated 
as follows:

TR16FE94.003

where:

Vo=Volume of sample (Ml)
Vl=Volume of spiking standard added (Ml)
Cm=Measured concentration of spiked sample
Co=Measured background concentration of sample
Cs=Known concentration of spiking standard

    (J) If the percent recovery of any individual spiked sample is 
outside the range 100% 10% from the theoretical 
concentration, then the sources of error in the analysis must be 
determined and corrected, and all analyses subsequent to and including 
the last analysis confirmed to be within the compliance specifications 
must be repeated. The maintenance of control charts is one acceptable 
method or ensuring compliance with this specification.
    (K) (1) Either the range (absolute difference) or relative range 
(but not necessarily both) for duplicate samples shall be less than the 
following limits: 

------------------------------------------------------------------------
                                                                Relative
                                        Concentration             range 
              Oxygenate                    (volume      Range    (volume
                                          percent)              percent)
------------------------------------------------------------------------
Methanol..............................      1.0-12.0   .......       7.2
Ethanol...............................      3.0-12.0   .......       7.1
t-Butanol.............................      3.0-12.0   .......       9.4
MTBE..................................      3.0-15.0      0.55       9.2
------------------------------------------------------------------------

    (2) Relative range is calculated as follows:

TR16FE94.004

where:

Rr=relative range
R=range
Co=concentration of the original sample
Cd=concentration of the duplicate sample

    (3) If the limits in paragraph (g)(8)(ii)(K)(1) of this section are 
exceeded, the sources of error in the analysis should be determined, 
corrected, and all analyses subsequent to and including the last 
duplicate analysis confirmed to be within the compliance specifications 
must be repeated. The specification limits for the range and relative 
range of duplicate analyses are minimum performance requirements. The 
performance of individual laboratories may indeed be better than these 
minimum requirements. For this reason it is recommended that control 
charts be utilized to monitor the variability of measurements in order 
to optimally detect abnormal situations and ensure a stable measurement 
process. For reference purposes, a single laboratory study of precision 
(approximately 35 replicates) yielded the following estimates of method 
precision: 

------------------------------------------------------------------------
                                 Concentration  Repeatability           
           Oxygenate                (weight        (volume     (Percent)
                                   percent)       percent)              
------------------------------------------------------------------------
Methanol.......................          2.0            3.7         0.11
Ethanol........................          2.0            5.4         0.24
t-Butanol......................          2.0            8.8         0.39
MTBE...........................          2.0           11.0        0.37 
------------------------------------------------------------------------

    (4) Repeatability is defined as the half width of the 95 percent 
confidence interval for a single analysis at the stated concentration.
    (iii) The laboratory shall routinely monitor the accuracy of its 
analyses. At a minimum this shall include:
    (A) Calibration check standards and calibration standards may be 
prepared from the same oxygenate stocks and by the same analyst. 
However, calibration check standards and calibration standards must be 
prepared from separate batches of the final diluted standards. For the 
specification limits listed in paragraph (g)(8)(iii)(C) of this 
section, the concentration of the check standards should be in the 
range given in paragraph (g)(8)(iii)(C) of this section.
    (B) Calibration check standards shall be analyzed at a rate of one 
per analysis batch or at least one per ten samples, whichever is more 
frequent.
    (C) If the measured concentration of a calibration check standard 
is outside the range of 100%10% percent of the theoretical 
concentration for methanol and ethanol, or 100%13% for t-
butanol and MTBE, the sources of error in the analysis should be 
determined, corrected, and all analyses subsequent to and including the 
last standard analysis confirmed to be within the compliance 
specifications must be repeated. The specification limits for the 
accuracy of calibration check standards analyses are minimum 
performance requirements. The performance of individual laboratories 
may indeed be better than these minimum requirements. For this reason 
it is recommended that control charts be utilized to monitor the 
variability of measurements in order to optimally detect abnormal 
situations and ensure a stable measurement process.
    (D) Independent reference standards shall be purchased or prepared 
from materials that are independent of the calibration standards and 
calibration check standards, and must not be prepared by the same 
analyst. For the specification limits listed in paragraph 
(g)(8)(iii)(F) of this section, the concentration of the reference 
standards should be in the range given in paragraph (g)(8)(iii)(C) of 
this section.
    (E) Independent reference standards shall be analyzed at a rate of 
one per analysis batch or at least one per 100 samples, whichever is 
more frequent.
    (F) If the measured concentration of an independent reference 
standard is outside the range of 100%10% of the theoretical 
concentration for methanol and ethanol, or 100%13% for t-
butanol and MTBE, the sources of error in the analysis should be 
determined, corrected, and all analyses subsequent to and including the 
last independent reference standard analysis confirmed to be within the 
compliance specifications in that batch must be repeated. The 
specification limits for the accuracy of independent reference 
standards analyses are minimum performance requirements. The 
performance of individual laboratories may indeed be better than these 
minimum requirements. For this reason it is recommended that control 
charts be utilized to monitor the variability of measurements in order 
to optimally detect abnormal situations and ensure a stable measurement 
process.
    (G) If matrix effects are suspected, then spiked samples shall be 
prepared and analyzed as follows:
    (1) Spiked samples shall be prepared by adding a volume of a 
standard to a known volume of sample. To ensure adequate method 
detection limits, the volume of the standard added to the sample should 
be minimized to 5% or less of the volume of the sample. The spiked 
sample should be carried through the same sample preparation steps as 
the background sample.
    (2) The percent recovery of spiked samples should be calculated as 
follows:

TR16FE94.005

where:

Cc=concentration of spiked sample
Co=concentration of sample without spiking
Cs=known concentration of spiking standard
Vo=volume of sample
Vs=volume of spiking standard added to the sample
    (3) If the percent recovery of a spiked sample is outside the range 
of 100% 13% of the theoretical concentration for methanol 
and ethanol, or 100% 16% for t-butanol and MTBE, the 
sources of error in the analysis should be determined, corrected, and 
all analyses subsequent to and including the last analysis confirmed to 
be within the compliance specifications must be repeated. The 
specification limits for the accuracy of the percent recovery of spiked 
sample analyses are minimum performance requirements. The performance 
of individual laboratories may indeed be better than these minimum 
requirements. For this reason it is recommended that control charts be 
utilized to monitor the variability of measurements in order to 
optimally detect abnormal situations and ensure a stable measurement 
process.
    (9)(i) Prior to January 1, 1997, and when the oxygenates present 
are limited to MTBE, ETBE, TAME, DIPE, tertiary-amyl alcohol, and 
C1 to C4 alcohols, any refiner, importer, or oxygenate 
blender may determine oxygen and oxygenate content using ASTM standard 
method D-4815-93, entitled ``Standard Test Method for Determination of 
MTBE, ETBE, TAME, DIPE, tertiary-Amyl Alcohol and C1 to C4 
Alcohols in Gasoline by Gas Chromatography,'' for purposes of meeting 
any testing requirement; provided that
    (ii) The refiner or importer test result is correlated with the 
method set forth in paragraphs (g)(1) through (g)(8) of this section.
    (h) Incorporations by reference. ASTM standard methods D-3606-92, 
D-1319-93, D-4815-93, D-2622-92, and D-86-90 with the exception of the 
degrees Fahrenheit figures in Table 9 of D-86-90, are incorporated by 
reference. These incorporations by reference were approved by the 
Director of the Federal Register in accordance with 5 U.S.C. 552(A) and 
1 CFR part 51. Copies may be obtained from the American Society of 
Testing Materials, 1916 Race Street, Philadelphia, PA 19103. Copies may 
be inspected at the Air Docket Section (LE-131), room M-1500, U.S. 
Environmental Protection Agency, Docket No. A-92-12, 401 M Street SW., 
Washington, DC 20460 or at the Office of the Federal Register, 800 
North Capitol Street, NW., suite 700, Washington, DC.


Sec. 80.47  [Reserved]


Sec. 80.48  Augmentation of the complex emission model by vehicle 
testing.

    (a) The provisions of this section apply only if a fuel claims 
emission reduction benefits from fuel parameters that are not included 
in the complex emission model or complex emission model database, or if 
the values of fuel parameters included in the complex emission model 
set forth in Sec. 80.45 fall outside the range of values for which the 
complex emission model is deemed valid.
    (b) To augment the complex emission model described at Sec. 80.45, 
the following requirements apply:
    (1) The petitioner must obtain prior approval from the 
Administrator for the design of the test program before beginning the 
vehicle testing process. To obtain approval, the petitioner must at 
minimum provide the following information: the fuel parameter to be 
evaluated for emission effects; the number and description of vehicles 
to be used in the test fleet, including model year, model name, vehicle 
identification number (VIN), mileage, emission performance (exhaust THC 
emission level), technology type, and manufacturer; a description of 
the methods used to procure and prepare the vehicles; the properties of 
the fuels to be used in the testing program (as specified at 
Sec. 80.49); the pollutants and emission categories intended to be 
evaluated; the precautions used to ensure that the effects of the 
parameter in question are independent of the effects of other 
parameters already included in the model; a description of the quality 
assurance procedures to be used during the test program; the 
statistical analysis techniques to be used in analyzing the test data, 
and the identity and location of the organization performing the 
testing.
    (2) Exhaust emissions shall be measured per the requirements of 
this section and Sec. 80.49 through Sec. 80.62.
    (3) The nonexhaust emission model (including evaporative, running 
loss, and refueling VOC and toxics emissions) shall not be augmented by 
vehicle testing.
    (4) The Agency reserves the right to observe and monitor any 
testing that is performed pursuant to the requirements of this section.
    (5) The Agency reserves the right to evaluate the quality and 
suitability of data submitted pursuant to the requirements of this 
section and to reject, re-analyze, or otherwise evaluate such data as 
is technically warranted.
    (6) Upon a showing satisfactory to the Administrator, the 
Administrator may approve a petition to waive the requirements of this 
section and Sec. 80.49, Sec. 80.50(a), Sec. 80.60(d)(3), and 
Sec. 80.60(d)(4) in order to better optimize the test program to the 
needs of the particular fuel parameter. Any such waiver petition should 
provide information justifying the requested waiver, including an 
acceptable rationale and supporting data. Petitioners must obtain 
approval from the Administrator prior to conducting testing for which 
the requirements in question are waived. The Administrator may waive 
the noted requirements in whole or in part, and may impose appropriate 
conditions on any such waiver.
    (c) In the case of petitions to augment the complex model defined 
at Sec. 80.45 with a new parameter, the effect of the parameter being 
tested shall be determined separately, for each pollutant and for each 
emitter class category. If the parameter is not included in the complex 
model but is represented in whole or in part by one or more parameters 
included in the model, the petitioner shall be required to demonstrate 
the emission effects of the parameter in question independent of the 
effects of the already-included parameters. The petitioner shall also 
have to demonstrate the effects of the already-included parameters 
independent of the effects of the parameter in question. The emission 
performance of each vehicle on the fuels specified at Sec. 80.49, as 
measured through vehicle testing in accordance with Sec. 80.50 through 
Sec. 80.62, shall be analyzed to determine the effects of the fuel 
parameter being tested on emissions according to the following 
procedure:
    (1) The analysis shall fit a regression model to the natural 
logarithm of emissions measured from addition fuels 1, 2, and 3 only 
(as specified at Sec. 80.49(a)) and adjusted as per paragraph 
(c)(1)(iv) of this section that includes the following terms:
    (i) A term for each vehicle that shall reflect the effect of the 
vehicle on emissions independent of fuel compositions. These terms 
shall be of the form Di x Vi, where Di is the 
coefficient for the term and Vi is a dummy variable which shall 
have the value 1.0 for the ith vehicle and the value 0 for all other 
vehicles.
    (ii) A linear term in the parameter being tested for each emitter 
class, of the form Ai x (P1-P1 (avg)) x Ei, where 
Ai is the coefficient for the term, P1 is the level of the 
parameter in question, P1 (avg) is the average level of the 
parameter in question for all seven test fuels specified at 
Sec. 80.49(a)(1), and Ei is a dummy variable representing emitter 
class, as defined at Sec. 80.62. For normal emitters, E1=1 and 
E2=0. For higher emitters, E1=0 and E2=1.
    (iii) For the VOC and NOx models, a squared term in the 
parameter being tested for each emitter class, of the form 
Bi x (P1-P1 (avg))\2\ x Ei, where Bi is the 
coefficient for the term and where P1 , P1 (avg), and Ei 
are as defined in paragraph (c)(1)(ii) of this section.
    (iv) To the extent that the properties of fuels 1, 2, and 3 which 
are incorporated in the complex model differ in value among the three 
fuels, the complex model shall be used to adjust the observed emissions 
from test vehicles on those fuels to compensate for those differences 
prior to fitting the regression model.
    (v) The Ai and Bi terms and coefficients developed by the 
regression described in this paragraph (c) shall be evaluated against 
the statistical criteria defined in paragraph (e) of this section. If 
both terms satisfy these criteria, then both terms shall be retained. 
If the Bi term satisfies these criteria and the Ai term does 
not, then both terms shall be retained. If the Bi term does not 
satisfy these criteria, then the Bi term shall be dropped from the 
regression model and the model shall be re-estimated. If, after 
dropping the Bi term, the Ai term does not satisfy these 
criteria, then both terms shall be dropped, all test data shall be 
reported to EPA, and the augmentation request shall be denied.
    (2) After completing the steps outlined in paragraph (c)(1) of this 
section, the analysis shall fit a regression model to a combined data 
set that includes vehicle testing results from all seven addition fuels 
specified at Sec. 80.49(a), the vehicle testing results used to develop 
the model specified at Sec. 80.45, and vehicle testing results used to 
support any prior augmentation requests which the Administrator deems 
necessary.
    (i) The analysis shall fit the regression models described in 
paragraphs (c)(2) (ii) through (v) of this section to the natural 
logarithm of measured emissions.
    (ii) All regressions shall include a term for each vehicle that 
shall reflect the effect of the vehicle on emissions independent of 
fuel compositions. These terms shall be of the form Di x Vi, 
where Di is the coefficient for the term and Vi is a dummy 
variable which shall have the value 1.0 for the ith vehicle and the 
value 0 for all other vehicles. Vehicles shall be represented by 
separate terms for each test program in which they were tested. The 
vehicle terms for the vehicles included in the test program undertaken 
by the petitioner shall be calculated based on the results from all 
seven fuels specified at Sec. 80.49(a). Note that the Di estimates 
for the petitioner's test vehicles in this regression are likely to 
differ from the Di estimates discussed in paragraph (c)(1)(i) of 
this section since they will be based on a different set of fuels.
    (iii) All regressions shall include existing complex model terms 
and their coefficients, including those augmentations that the 
Administrator deems necessary. All terms and coefficients shall be 
expressed in centered form.
    (iv) All regressions shall include the linear and squared terms, 
and their coefficients, estimated in the final regression model 
described in paragraph (c)(1) of this section.
    (v) The VOC and NOx regressions shall include those 
interactive terms with other fuel parameters, of the form 
Ci(1,j) x (P1-P1 (avg)) x (Pj-Pj 
(avg)) x Ei, where Ci(1,j) is the coefficient for the term, 
P1 is the level of the parameter being added to the model, P1 
(avg) is the average level of the parameter being added for all seven 
addition fuels specified at Sec. 80.49(a), Pj is the level of the 
other fuel parameter, Pj (avg) is the centering value for the 
other fuel parameter used to develop the complex model or used in the 
other parameter's augmentation study, and Ei is as defined in 
paragraph (c)(1) of this section, which are found to satisfy the 
statistical criteria defined in paragraph (e) of this section. Such 
terms shall be added to the regression model in a stepwise manner.
    (3) The model described in paragraphs (c) (1) and (2) of this 
section shall be developed separately for normal-emitting and higher-
emitting vehicles. Each emitter class shall be treated as a distinct 
population for the purposes of determining regression coefficients.
    (4) Once the augmented models described in paragraphs (c) (1) 
through (3) of this section have been developed, they shall be 
converted to an uncentered form through appropriate algebraic 
manipulation.
    (5) The augmented model described in paragraph (c)(4) of this 
section shall be used to determine the effects of the parameter in 
question at levels between the levels in Fuels 1 and 3, as defined at 
Sec. 80.49(a)(1), for all fuels which claim emission benefits from the 
parameter in question.
    (d)(1) In the case of petitions to augment the complex model 
defined at Sec. 80.45 by extending the range of an existing complex 
model parameter, the effect of the parameter being tested shall be 
determined separately, for each pollutant and for each technology group 
and emitter class category, at levels between the extension level and 
the nearest limit of the core of the data used to develop the 
unaugmented complex model as follows: 

------------------------------------------------------------------------
                                                       Data core limits 
                   Fuel parameter                    -------------------
                                                       Lower     Upper  
------------------------------------------------------------------------
Sulfur, ppm.........................................      10       450  
RVP, psi............................................       7        10  
E200, vol %.........................................      33        66  
E300, vol %.........................................      72        94  
Aromatics, vol %....................................      18        46  
Benzene, vol %......................................       0.4       1.8
Olefins, vol %......................................       1        19  
Oxygen, wt %........................................                    
  As ethanol........................................       0         3.4
  All others:.......................................       0         2.7 
------------------------------------------------------------------------

    (2) The emission performance of each vehicle on the fuels specified 
at Sec. 80.49(b)(2), as measured through vehicle testing in accordance 
with Secs. 80.50 through 80.62, shall be analyzed to determine the 
effects of the fuel parameter being tested on emissions according to 
the following procedure:
    (i) The analysis shall incorporate the vehicle testing data from 
the extension fuels specified at Sec. 80.49(b), the vehicle testing 
results used to develop the model specified at Sec. 80.45, and vehicle 
testing results used to support any prior augmentation requests which 
the Administrator deems necessary. A regression incorporating the 
following terms shall be fitted to the natural logarithm of emissions 
contained in this combined data set:
    (A) A term for each vehicle that shall reflect the effect of the 
vehicle on emissions independent of fuel compositions. These terms 
shall be of the form Di x Vi, where Di is the 
coefficient for the term and Vi is a dummy variable which shall 
have the value 1.0 for the ith vehicle and the value 0 for all other 
vehicles. Vehicles shall be represented by separate terms for each test 
program in which they were tested. The vehicle terms for the vehicles 
included in the test program undertaken by the petitioner shall be 
calculated based on the results from all three fuels specified at 
Sec. 80.49(b)(2).
    (B) Existing complex model terms that do not include the parameter 
being extended and their coefficients, including those augmentations 
that the Administrator deems necessary. The centering values for these 
terms shall be identical to the centering values used to develop the 
complex model described at Sec. 80.45.
    (C) Existing complex model terms that include the parameter being 
extended. The coefficients for these terms shall be estimated by the 
regression. The centering values for these terms shall be identical to 
the centering values used to develop the complex model described at 
Sec. 80.45.
    (D) If the unaugmented VOC or NOx complex models do not 
contain a squared term for the parameter being extended, such a term 
should be added in a stepwise fashion after completing the model 
described in paragraphs (d)(2)(i)(A) through (C) of this section. The 
coefficient for this term shall be estimated by the regression. The 
centering value for this term shall be identical to the centering value 
used to develop the complex model described at Sec. 80.45.
    (E) The terms defined in paragraphs (d)(2)(i)(C) and (D) of this 
section shall be evaluated against the statistical criteria defined in 
paragraph (e) of this section.
    (ii) The model described in paragraph (d)(2)(i) of this section 
shall be developed separately for normal-emitting and higher-emitting 
vehicles, as defined at Sec. 80.62. Each emitter class shall be treated 
as a distinct population for the purposes of determining regression 
coefficients.
    (e) Statistical criteria. (1) The petitioner shall be required to 
submit evidence with the petition which demonstrates the statistical 
validity of the regression described in paragraph (c) or (d) of this 
section, including at minimum:
    (i) Evidence demonstrating that colinearity problems are not 
severe, including but not limited to variance inflation statistics of 
less than 10 for the second-order and interactive terms included in the 
regression model.
    (ii) Evidence demonstrating that the regression residuals are 
normally distributed, including but not limited to the skewness and 
Kurtosis statistics for the residuals.
    (iii) Evidence demonstrating that overfitting and underfitting 
risks have been balanced, including but not limited to the use of 
Mallow's Cp criterion.
    (2) The petitioner shall be required to submit evidence with the 
petition which demonstrates that the appropriate terms have been 
included in the regression, including at minimum:
    (i) Descriptions of the analysis methods used to develop the 
regressions, including any computer code used to analyze emissions data 
and the results of regression runs used to develop the proposed 
augmentation, including intermediate regressions produced during the 
stepwise regression process.
    (ii) Evidence demonstrating that the significance level used to 
include terms in the model was equal to 0.90.
    (f) The complex emission model shall be augmented with the results 
of vehicle testing as follows:
    (1) The terms and coefficients determined in paragraph (c) or (d) 
of this section shall be used to supplement the complex emission model 
equation for the corresponding pollutant and emitter category. These 
terms and coefficients shall be weighted to reflect the contribution of 
the emitter category to in-use emissions as shown at Sec. 80.45.
    (2) If the candidate parameter is not included in the unaugmented 
complex model and is not represented in whole or in part by one or more 
parameters included in the model, the modification shall be 
accomplished by adding the terms and coefficients to the complex model 
equation for that pollutant, technology group, and emitter category.
    (3) If the parameter is included in the complex model but is being 
tested at levels beyond the current range of the model, the terms and 
coefficients determined in paragraph (d) of this section shall be used 
to supplement the complex emission model equation for the corresponding 
pollutant.
    (i) The terms and coefficients of the complex model described at 
Sec. 80.45 shall be used to evaluate the emissions performance of fuels 
with levels of the parameter being tested that are within the valid 
range of the model, as defined at Sec. 80.45.
    (ii) The emissions performance of fuels with levels of the 
parameter that are beyond the valid range of the unaugmented model 
shall be given in percentage change terms by 100-[(100+A) x (100+C)/
(100+B)], where:
    (A) ``A'' shall be set equal to the percentage change in emissions 
for a fuel with identical fuel property values to the fuel being 
evaluated except for the parameter being extended, which shall be set 
equal to the nearest limit of the data core, using the unaugmented 
complex model.
    (B) ``B'' shall be set equal to the percentage change in emissions 
for the fuel described in paragraph (f)(3)(i) of this section according 
to the augmented complex model.
    (C) ``C'' shall be set equal to the percentage change in emissions 
of the actual fuel being evaluated using the augmented complex model.
    (g) EPA reserves the right to analyze the data generated during 
vehicle testing, to use such analyses to determine the validity of the 
augmentation petition, and to use such data to update the complex model 
for use in certifying all reformulated gasolines.
    (h) Duration of acceptance of emission effects determined through 
vehicle testing:
    (1) If the Agency does not accept, modify, or reject a particular 
augmentation for inclusion in an updated complex model (performed 
through rulemaking), then the augmentation shall remain in effect until 
the next update to the complex model takes effect.
    (2) If the Agency does reject or modify a particular augmentation 
for inclusion in an updated complex model, then the augmentation shall 
no longer be able to be used as of the date the updated complex model 
is deemed to take effect, unless the following conditions and 
limitations apply:
    (i) The augmentation in question may continue to be used by those 
fuel suppliers which can prove, to the Administrator's satisfaction, 
that the fuel supplier had already begun producing a fuel utilizing the 
augmentation at the time the revised model is promulgated.
    (ii) The augmentation in question may only be used to evaluate the 
emissions performance of fuels in conjunction with the complex emission 
model in effect as of the date of production of the fuels.
    (iii) The augmentation may only be used for three years of fuel 
production, or a total of five years from the date the augmentation 
first took effect, whichever is shorter.
    (3) The Administrator shall determine when sufficient new 
information on the effects of fuel properties on vehicle emissions has 
been obtained to warrant development of an updated complex model.


Sec. 80.49  Fuels to be used in augmenting the complex emission model 
through vehicle testing.

    (a) Seven fuels (hereinafter called the ``addition fuels'') shall 
be tested for the purpose of augmenting the complex emission model with 
a parameter not currently included in the complex emission model. The 
properties of the addition fuels are specified in paragraphs (a) (1) 
and (2) of this section. The addition fuels shall be specified with at 
least the same level of detail and precision as in Sec. 80.43(c), and 
this information must be included in the petition submitted to the 
Administrator requesting augmentation of the complex emission model.
    (1) The seven addition fuels to be tested when augmenting the 
complex model specified at Sec. 80.45 with a new fuel parameter shall 
have the properties specified as follows: 

              Properties of Fuels To Be Tested When Augmenting the Model With a New Fuel Parameter              
----------------------------------------------------------------------------------------------------------------
                                                                    Fuels                                       
       Fuel property         -----------------------------------------------------------------------------------
                                  1           2           3           4           5           6           7     
----------------------------------------------------------------------------------------------------------------
Sulfur, ppm.................  150         150         150         35          35          500         500       
Benzene, vol %..............  1.0         1.0         1.0         0.5         0.5         1.3         1.3       
RVP, psi....................  7.5         7.5         7.5         6.5         6.5         8.1         8.1       
E200, %.....................  50          50          50          62          62          37          37        
E300, %.....................  85          85          85          92          92          79          79        
Aromatics, vol %............  27          27          27          20          20          45          45        
Olefins, vol %..............  9.0         9.0         9.0         2.0         2.0         18          18        
Oxygen, wt %................  2.1         2.1         2.1         2.7         2.7         1.5         1.5       
Octane, (R+M)/2.............  87          87          87          87          87          87          87        
New Parameter\1\............  C           C+B/2       B           C           B           C           B         
----------------------------------------------------------------------------------------------------------------
\1\C=Candidate level, B=Baseline level.                                                                         

    (i) For the purposes of vehicle testing, the ``baseline'' level of 
the parameter shall refer to the level of the parameter in Clean Air 
Act baseline gasoline. The ``candidate'' level of the parameter shall 
refer to the most extreme value of the parameter, relative to baseline 
levels, for which the augmentation shall be valid.
    (ii) If the fuel parameter for which the fuel supplier is 
petitioning EPA to augment the complex emission model (hereinafter 
defined as the ``candidate parameter'') is not specified for Clean Air 
Act summer baseline fuel, then the baseline level for the candidate 
parameter shall be set at the levels found in typical gasoline. This 
level and the justification for this level shall be included in the 
petitioner's submittal to EPA prior to initiating the test program, and 
EPA must approve this level prior to the start of the program.
    (iii) If the candidate parameter is not specified for Clean Air Act 
summer baseline fuel, and is not present in typical gasoline, its 
baseline level shall be zero.
    (2) The addition fuels shall contain detergent control additives in 
accordance with section 211(l) of the Clean Air Act Amendments of 1990 
and the associated EPA requirements for such additives.
    (3) The addition fuels shall be specified with at least the same 
level of detail and precision as in Sec. 80.43(c), and this information 
shall be included in the petition submitted to the Administrator 
requesting augmentation of the complex emission model.
    (i) Paraffin levels in Fuels 1 and 2 shall be altered from the 
paraffin level in Fuel 3 to compensate for the addition or removal of 
the candidate parameter, if necessary. Paraffin levels in Fuel 4 shall 
be altered from the paraffin level in Fuel 5 to compensate for the 
addition or removal of the candidate parameter, if necessary. Paraffin 
levels in Fuel 6 shall be altered from the paraffin level in Fuel 7 to 
compensate for the addition or removal of the candidate parameter, if 
necessary.
    (ii) Other properties of Fuels 4 and 6 shall not vary from the 
levels for Fuels 5 and 7, respectively, unless such variations are the 
naturally-occurring result of the changes described in paragraphs 
(a)(1) and (2) of this section. Other properties of Fuels 1 and 2 shall 
not vary from the levels for Fuel 3, unless such variations are the 
naturally- occurring result of the changes described in paragraphs 
(a)(1) and (2) of this section.
    (iii) The addition fuels shall be specified with at least the same 
level of detail and precision as defined in paragraph (a)(5)(i) of this 
section, and this information must be included in the petition 
submitted to the Administrator requesting augmentation of the complex 
emission model.
    (4) The properties of the addition fuels shall be within the 
blending tolerances defined in this paragraph (a)(4) relative to the 
values specified in paragraphs (a)(1) and (2) of this section. Fuels 
that do not meet these tolerances shall require the approval of the 
Administrator to be used in vehicle testing to augment the complex 
emission model: 

------------------------------------------------------------------------
          Fuel parameter                     Blending tolerance         
------------------------------------------------------------------------
Sulfur content.....................  25 ppm.                
Benzene content....................  0.2 vol %.             
RVP................................  0.2 psi.               
E200 level.........................  2 %.                   
E300 level.........................  4 %.                   
Oxygenate content..................  1.0 vol %.             
Aromatics content..................  2.7 vol %.             
Olefins content....................  2.5 vol %.             
Saturates content..................  2.0 vol %.             
Octane.............................  0.5.                   
Detergent control additives........  10% of the level       
                                      required by EPA's detergents rule.
Candidate parameter................  To be determined as part of the    
                                      augmentation process.             
------------------------------------------------------------------------

    (5) The composition and properties of the addition fuels shall be 
determined by averaging a series of independent tests of the properties 
and compositional factors defined in paragraph (a)(5)(i) of this 
section as well as any additional properties or compositional factors 
for which emission benefits are claimed.
    (i) The number of independent tests to be conducted shall be 
sufficiently large to reduce the measurement uncertainty for each 
parameter to a sufficiently small value. At a minimum the 95% 
confidence limits (as calculated using a standard t-test) for each 
parameter must be within the following range of the mean measured value 
of each parameter: 

------------------------------------------------------------------------
          Fuel parameter                   Measurement uncertainty      
------------------------------------------------------------------------
API gravity........................  0.2 deg.API.           
Sulfur content.....................  10 ppm.                
Benzene content....................  0.02 vol %.            
RVP................................  0.05 psi.              
Octane.............................  0.2 (R+M/2).           
E200 level.........................  2%.                    
E300 level.........................  2%.                    
Oxygenate content..................  0.2 vol %.             
Aromatics content..................  0.5 vol %.             
Olefins content....................  0.3 vol %.             
Saturates content..................  1.0 vol %.             
Detergent control additives........  2% of the level        
                                      required by EPA's detergents rule.
Candidate parameter................  To be determined as part of the    
                                      augmentation process.             
------------------------------------------------------------------------

    (ii) The 95% confidence limits for measurements of fuel parameters 
for which emission reduction benefits are claimed and for which 
tolerances are not defined in paragraph (a)(5)(i) of this section must 
be within 5% of the mean measured value.
    (iii) Each test must be conducted in the same laboratory in 
accordance with the procedures outlined at Sec. 80.46.
    (b) Three fuels (hereinafter called the ``extension fuels'') shall 
be tested for the purpose of extending the valid range of the complex 
emission model for a parameter currently included in the complex 
emission model. The properties of the extension fuels are specified in 
paragraphs (b)(2) through (4) of this section. The extension fuels 
shall be specified with at least the same level of detail and precision 
as in Sec. 80.43(c), and this information must be included in the 
petition submitted to the Administrator requesting augmentation of the 
complex emission model. Each set of three extension fuels shall be used 
only to extend the range of a single complex model parameter.
    (1) The ``extension level'' shall refer to the level to which the 
parameter being tested is to be extended. The three fuels to be tested 
when extending the range of fuel parameters already included in the 
complex model or a prior augmentation to the complex model shall be 
referred to as ``extension fuels.''
    (2) The composition and properties of the extension fuels shall be 
as described in paragraphs (b)(2) (i) and (ii) of this section.
    (i) The extension fuels shall have the following levels of the 
parameter being extended: 

       Level of Existing Complex Model Parameters Being Extended        
------------------------------------------------------------------------
  Fuel property being                            Extension    Extension 
       extended          Extension fuel No. 1   fuel No. 2   fuel No. 3 
------------------------------------------------------------------------
Sulfur, ppm...........  Extension level.......         80          450  
Benzene, vol %........  Extension level.......          0.5          1.5
RVP, psi..............  Extension level.......          6.7          8.0
E200, %...............  Extension level.......         38           61  
E300, %...............  Extension level.......         78           92  
Aromatics, vol %......  Extension level.......         20           45  
Olefins, vol %........  Extension level.......          3.0         18  
Oxygen, wt %..........  Extension level.......          1.7          2.7
Octane, R+M/2.........  87....................         87          87   
------------------------------------------------------------------------

    (ii) The levels of parameters other than the one being extended 
shall be given by the following table for all three extension fuels: 

       Levels for Fuel Parameters Other Than Those Being Extended       
------------------------------------------------------------------------
                                         Extension  Extension  Extension
             Fuel property                fuel No.   fuel No.   fuel No.
                                             1          2          3    
------------------------------------------------------------------------
Sulfur, ppm............................      150        150        150  
Benzene, vol %.........................        1.0        1.0        1.0
RVP, psi...............................        7.5        7.5        7.5
E200, %................................       50         50         50  
E300, %................................       85         85         85  
Aromatics, vol %.......................       25         25         25  
Olefins, vol %.........................        9.0        9.0        9.0
Oxygen, wt %...........................        2.0        2.0        2.0
Octane, R+M/2..........................       87         87        87   
------------------------------------------------------------------------

    (3) If the Complex Model for any pollutant includes one or more 
interactive terms involving the parameter being extended, then two 
additional extension fuels shall be required to be tested for each such 
interactive term. These additional extension fuels shall have the 
following properties:
    (i) The parameter being tested shall be present at its extension 
level.
    (ii) The interacting parameter shall be present at the levels 
specified in paragraph (b)(2)(i) of this section for extension Fuels 2 
and 3.
    (iii) All other parameters shall be present at the levels specified 
in paragraphs (b)(2)(ii) and (b)(3) of this section.
    (4) All extension fuels shall contain detergent control additives 
in accordance with Section 211(l) of the Clean Air Act Amendments of 
1990 and the associated EPA requirements for such additives.
    (c) The addition fuels defined in paragraph (a) of this section and 
the extension fuels defined in paragraph (b) of this section shall meet 
the following requirements for blending and measurement precision:
    (1) The properties of the test and extension fuels shall be within 
the blending tolerances defined in this paragraph (c) relative to the 
values specified in paragraphs (a) and (b) of this section. Fuels that 
do not meet the following tolerances shall require the approval of the 
Administrator to be used in vehicle testing to augment the complex 
emission model: 

------------------------------------------------------------------------
          Fuel parameter                     Blending tolerance         
------------------------------------------------------------------------
Sulfur content.....................  25 ppm.                
Benzene content....................  0.2 vol %.             
RVP................................  0.2 psi.               
E200 level.........................  2 %.                   
E300 level.........................  4 %.                   
Oxygenate content..................  1.5 vol %.             
Aromatics content..................  2.7 vol %.             
Olefins content....................  2.5 vol %.             
Saturates content..................  2.0 vol %.             
Octane.............................  0.5.                   
Candidate parameter................  To be determined as part of the    
                                      augmentation process.             
------------------------------------------------------------------------

    (2) The extension and addition fuels shall be specified with at 
least the same level of detail and precision as defined in paragraph 
(c)(2)(ii) of this section, and this information must be included in 
the petition submitted to the Administrator requesting augmentation of 
the complex emission model.
    (i) The composition and properties of the addition and extension 
fuels shall be determined by averaging a series of independent tests of 
the properties and compositional factors defined in paragraph 
(c)(2)(ii) of this section as well as any additional properties or 
compositional factors for which emission benefits are claimed.
     (ii) The number of independent tests to be conducted shall be 
sufficiently large to reduce the measurement uncertainty for each 
parameter to a sufficiently small value. At a minimum the 95% 
confidence limits (as calculated using a standard t-test) for each 
parameter must be within the following range of the mean measured value 
of each parameter: 

------------------------------------------------------------------------
          Fuel parameter                   Measurement uncertainty      
------------------------------------------------------------------------
API gravity........................  0.2  deg.API.          
Sulfur content.....................  5 ppm.                 
Benzene content....................  0.05 vol %.            
RVP................................  0.08 psi.              
Octane.............................  0.1 (R+M/2).           
E200 level.........................  2 %.                   
E300 level.........................  2 %.                   
Oxygenate content..................  0.2 vol %.             
Aromatics content..................  0.5 vol %.             
Olefins content....................  0.3 vol %.             
Saturates content..................  1.0 vol.%              
Octane.............................  0.2.                   
Candidate parameter................  To be determined as part of the    
                                      augmentation process.             
------------------------------------------------------------------------

    (iii) Petitioners shall obtain approval from EPA for the 95% 
confidence limits for measurements of fuel parameters for which 
emission reduction benefits are claimed and for which tolerances are 
not defined in paragraph (c)(2)(i) of this section.
    (iv) Each test must be conducted in the same laboratory in 
accordance with the procedures outlined at Sec. 80.46.
    (v) The complex emission model described at Sec. 80.45 shall be 
used to adjust the emission performance of the addition and extension 
fuels to compensate for differences in fuel compositions that are 
incorporated in the complex model, as described at Sec. 80.48. 
Compensating adjustments for naturally-resulting variations in fuel 
parameters shall also be made using the complex model. The adjustment 
process is described in paragraph (d) of this section.
    (d) The complex emission model described at Sec. 80.45 shall be 
used to adjust the emission performance of addition and extension fuels 
to compensate for differences in fuel parameters other than the 
parameter being tested. Compensating adjustments for naturally-
resulting variations in fuel parameters shall also be made using the 
complex model. These adjustments shall be calculated as follows:
    (1) Determine the exhaust emissions performance of the actual 
addition or extension fuels relative to the exhaust emissions 
performance of Clean Air Act baseline fuel using the complex model. For 
addition fuels, set the level of the parameter being tested at baseline 
levels for purposes of emissions performance evaluation using the 
complex model. For extension fuel #1, set the level of the parameter 
being extended at the level specified in extension fuel #2. Also 
determine the exhaust emissions performance of the addition fuels 
specified in paragraph (a)(1) of this section with the level of the 
parameter being tested set at baseline levels.
    (2) Calculate adjustment factors for each addition fuel as follows:
    (i) Adjustment factors shall be calculated using the formula:

TR16FE94.006

where
A=the adjustment factor
P(actual)=the performance of the actual fuel used in testing according 
to the complex model
P(nominal)=the performance that would have been achieved by the test 
fuel defined in paragraph (a)(1) of this section according to the 
complex model (as described in paragraph (d)(1) of this section).

    (ii) Adjustment factors shall be calculated for each pollutant and 
for each emitter class.
    (3) Multiply the measured emissions from each vehicle by the 
corresponding adjustment factor for the appropriate addition or 
extension fuel, pollutant, and emitter class. Use the resulting 
adjusted emissions to conduct all modeling and emission effect 
estimation activities described in Sec. 80.48.
    (e) All fuels included in vehicle testing programs shall have an 
octane number of 87.5, as measured by the (R+M)/2 method following the 
ASTM D4814 procedures, to within the measurement and blending 
tolerances specified in paragraph (c) of this section.
    (f) A single batch of each addition or extension fuel shall be used 
throughout the duration of the testing program.


Sec. 80.50  General test procedure requirements for augmentation of the 
emission models.

    (a) The following test procedure must be followed when testing to 
augment the complex emission model described at Sec. 80.45.
    (1) VOC, NOX, CO, and CO2 emissions must be measured for 
all fuel-vehicle combinations tested.
    (2) Toxics emissions must be measured when testing the extension 
fuels per the requirements of Sec. 80.49(a) or when testing addition 
fuels 1, 2, and 3 per the requirements of Sec. 80.49(a).
    (3) When testing addition fuels 4, 5, 6, and 7 per the requirements 
of Sec. 80.49(a), toxics emissions need not be measured. However, EPA 
reserves the right to require the inclusion of such measurements in the 
test program prior to approval of the test program if evidence exists 
which suggests that adverse interactive effects of the parameter in 
question may exist for toxics emissions.
    (b) The general requirements per 40 CFR 86.130-96 shall be met.
    (c) The engine starting and restarting procedures per 40 CFR 
86.136-90 shall be followed.
    (d) Except as provided for at Sec. 80.59, general preparation of 
vehicles being tested shall follow procedures detailed in 40 CFR 
86.130-96 and 86.131-96.


Sec. 80.51  Vehicle test procedures.

    The test sequence applicable when augmenting the emission models 
through vehicle testing is as follows:
    (a) Prepare vehicles per Sec. 80.50.
    (b) Initial preconditioning per Sec. 80.52(a)(1). Vehicles shall be 
refueled randomly with the fuels required in Sec. 80.49 when testing to 
augment the complex emission model.
    (c) Exhaust emissions tests, dynamometer procedure per 40 CFR 
86.137-90 with:
    (1) Exhaust Benzene and 1,3-Butadiene emissions measured per 
Sec. 80.55; and
    (2) Formaldehyde and Acetelaldehyde emissions measured per 
Sec. 80.56.


Sec. 80.52  Vehicle preconditioning.

    (a) Initial vehicle preconditioning and preconditioning between 
tests with different fuels shall be performed in accordance with the 
``General vehicle handling requirements'' per 40 CFR 86.132-96, up to 
and including the completion of the hot start exhaust test.
    (b) The preconditioning procedure prescribed at 40 CFR 86.132-96 
shall be observed for preconditioning vehicles between tests using the 
same fuel.


Secs. 80.53-80.54  [Reserved]


Sec. 80.55  Measurement methods for benzene and 1,3-butadiene.

    (a) Sampling for benzene and 1,3-butadiene must be accomplished by 
bag sampling as used for total hydrocarbons determination. This 
procedure is detailed in 40 CFR 86.109.
    (b) Benzene and 1,3-butadiene must be analyzed by gas 
chromatography. Expected values for benzene and 1,3-butadiene in bag 
samples for the baseline fuel are 4.0 ppm and 0.30 ppm respectively. At 
least three standards ranging from at minimum 50% to 150% of these 
expected values must be used to calibrate the detector. An additional 
standard of at most 0.01 ppm must also be measured to determine the 
required limit of quantification as described in paragraph (d) of this 
section.
    (c) The sample injection size used in the chromatograph must be 
sufficient to be above the laboratory determined limit of 
quantification (LOQ) as defined in paragraph (d) of this section for at 
least one of the bag samples. A control chart of the measurements of 
the standards used to determine the response, repeatability, and limit 
of quantitation of the instrumental method for 1,3-butadiene and 
benzene must be reported.
    (d) As in all types of sampling and analysis procedures, good 
laboratory practices must be used. See, Lawrence, Principals of 
Environmental Analysis, 55 Analytical Chemistry 14, at 2210-2218 (1983) 
(copies may be obtained from the publisher, American Chemical Society, 
1155 16th Street NW., Washington, DC 20036). Reporting reproducibility 
control charts and limits of detection measurements are integral 
procedures to assess the validity of the chosen analytical method. The 
repeatability of the test method must be determined by measuring a 
standard periodically during testing and recording the measured values 
on a control chart. The control chart shows the error between the 
measured standard and the prepared standard concentration for the 
periodic testing. The error between the measured standard and the 
actual standard indicates the uncertainty in the analysis. The limit of 
detection (LOD) is determined by repeatedly measuring a blank and a 
standard prepared at a concentration near an assumed value of the limit 
of detection. If the average concentration minus the average of the 
blanks is greater than three standard deviations of these measurements, 
then the limit of detection is at least as low as the prepared 
standard. The limit of quantitation (LOQ) is defined as ten times the 
standard deviation of these measurements. This quantity defines the 
amount of sample required to be measured for a valid analysis.
    (e) Other sampling and analytical techniques will be allowed if 
they can be proven to have equal specificity and equal or better limits 
of quantitation. Data from alternative methods that can be demonstrated 
to have equivalent or superior limits of detection, precision, and 
accuracy may be accepted by the Administrator with individual prior 
approval.


Sec. 80.56  Measurement methods for formaldehyde and acetaldehyde.

    (a) Formaldehyde and acetaldehyde will be measured by drawing 
exhaust samples from heated lines through either 2,4-
Dinitrophenylhydrazine (DNPH) impregnated cartridges or impingers 
filled with solutions of DNPH in acetonitrile (ACN) as described in 
Secs. 86.109 and 86.140 of this chapter for formaldehyde analysis. 
Diluted exhaust sample volumes must be at least 15 L for impingers 
containing 20 ml of absorbing solution (using more absorbing solution 
in the impinger requires proportionally more gas sample to be taken) 
and at least 4 L for cartridges. As required in Sec. 86.109 of this 
chapter, two impingers or cartridges must be connected in series to 
detect breakthrough of the first impinger or cartridge.
    (b) In addition, sufficient sample must be drawn through the 
collecting cartridges or impingers so that the measured quantity of 
aldehyde is sufficiently greater than the minimum limit of quantitation 
of the test method for at least a portion of the exhaust test 
procedure. The limit of quantitation is determined using the technique 
defined in Sec. 80.55(d).
    (c) Each of the impinger samples are quantitatively transferred to 
a 25 mL volumetric flask (5 mL more than the sample impinger volume) 
and brought to volume with ACN. The cartridge samples are eluted in 
reversed direction by gravity feed with 6mL of ACN. The eluate is 
collected in a graduated test tube and made up to the 5mL mark with 
ACN. Both the impinger and cartridge samples must be analyzed by HPLC 
without additional sample preparation.
    (d) The analysis of the aldehyde derivatives collected is 
accomplished with a high performance liquid chromatograph (HPLC). 
Standards consisting of the hydrazone derivative of formaldehyde and 
acetaldehyde are used to determine the response, repeatability, and 
limit of quantitation of the HPLC method chosen for acetaldehyde and 
formaldehyde.
    (e) Other sampling and analytical techniques will be allowed if 
they can be proven to have equal specificity and equal or better limits 
of quantitation. Data from alternative methods that can be demonstrated 
to have equivalent or superior limits of detection, precision, and 
accuracy may be accepted by the Administrator with individual prior 
approval.


Secs. 80.57-80.58  [Reserved]


Sec. 80.59  General test fleet requirements for vehicle testing.

    (a) The test fleet must consist of only 1989-91 MY vehicles which 
are technologically equivalent to 1990 MY vehicles, or of 1986-88 MY 
vehicles for which no changes to the engine or exhaust system that 
would significantly affect emissions have been made through the 1990 
model year. To be technologically equivalent vehicles must have closed-
loop systems and possess adaptive learning.
    (b) No maintenance or replacement of any vehicle component is 
permitted except when necessary to ensure operator safety or as 
specifically permitted in Sec. 80.60 and Sec. 80.61. All vehicle 
maintenance procedures must be reported to the Administrator.
    (c) Each vehicle in the test fleet shall have no fewer than 4,000 
miles of accumulated mileage prior to being included in the test 
program.


Sec. 80.60  Test fleet requirements for exhaust emission testing.

    (a) Candidate vehicles which conform to the emission performance 
requirements defined in paragraphs (b) through (d) of this section 
shall be obtained directly from the in-use fleet and tested in their 
as-received condition.
    (b) Candidate vehicles for the test fleet must be screened for 
their exhaust VOC emissions in accordance with the provisions in 
Sec. 80.62.
    (c) On the basis of pretesting pursuant to paragraph (b) of this 
section, the test fleet shall be subdivided into two emitter group sub-
fleets: the normal emitter group and the higher emitter group.
    (1) Each vehicle with an exhaust total hydrocarbon (THC) emissions 
rate which is less than or equal to twice the applicable emissions 
standard shall be placed in the normal emitter group.
    (2) Each vehicle with an exhaust THC emissions rate which is 
greater than two times the applicable emissions standard shall be 
placed in the higher emitter group.
    (d) The test vehicles in each emitter group must conform to the 
requirements of paragraphs (d)(1) through (4) of this section.
    (1) Test vehicles for the normal emitter sub-fleet must be selected 
from the list shown in this paragraph (d)(1). This list is arranged in 
order of descending vehicle priority, such that the order in which 
vehicles are added to the normal emitter sub-fleet must conform to the 
order shown (e.g., a ten-vehicle normal emitter group sub-fleet must 
consist of the first ten vehicles listed in this paragraph (d)(1)). If 
more vehicles are tested than the minimum number of vehicles required 
for the normal emitter sub-fleet, additional vehicles are to be added 
to the fleet in the order specified in this paragraph (d)(1), beginning 
with the next vehicle not already included in the group. The vehicles 
in the normal emitter sub-fleet must possess the characteristics 
indicated in the list. If the end of the list is reached in adding 
vehicles to the normal emitter sub-fleet and additional vehicles are 
desired then they shall be added beginning with vehicle number one, and 
must be added to the normal emitter sub-fleet in accordance with the 
order in Table A: 

                                         Table A--Test Fleet Definitions                                        
----------------------------------------------------------------------------------------------------------------
                                                                                        Tech.                   
    Veh. No.        Fuel system       Catalyst       Air injection         EGR          group     Manufacturer  
----------------------------------------------------------------------------------------------------------------
1...............  Multi..........  3W.............  No Air.........  EGR............          1  GM.            
2...............  Multi..........  3W.............  No Air.........  No EGR.........          2  Ford.          
3...............  TBI............  3W.............  No Air.........  EGR............          3  GM.            
4...............  Multi..........  3W+OX..........  Air............  EGR............          4  Ford.          
5...............  Multi..........  3W.............  No Air.........  EGR............          1  Honda.         
6...............  Multi..........  3W.............  No Air.........  No EGR.........          2  GM.            
7...............  TBI............  3W.............  No Air.........  EGR............          3  Chrysler.      
8...............  Multi..........  3W+OX..........  Air............  EGR............          4  GM.            
9...............  TBI............  3W+OX..........  Air............  EGR............          7  Chrysler.      
10..............  Multi..........  3W.............  Air............  EGR............          5  Toyota.        
11..............  Multi..........  3W.............  No Air.........  EGR............          1  Ford.          
12..............  Multi..........  3W.............  No Air.........  No EGR.........          2  Chrysler.      
13..............  Carb...........  3W+OX..........  Air............  EGR............          9  Toyota.        
14..............  TBI............  3W.............  No Air.........  EGR............          3  Ford.          
15..............  Multi..........  3W+OX..........  Air............  EGR............          4  GM.            
16..............  Multi..........  3W.............  No Air.........  EGR............          1  Toyota.        
17..............  Multi..........  3W.............  No Air.........  No EGR.........          2  Mazda.         
18..............  TBI............  3W.............  No Air.........  EGR............          3  GM.            
19..............  Multi..........  3W+OX..........  Air............  EGR............          4  Ford.          
20..............  Multi..........  3W.............  No Air.........  EGR............          1  Nissan.        
----------------------------------------------------------------------------------------------------------------


                                   Table B--Tech Group Definitions in Table A                                   
----------------------------------------------------------------------------------------------------------------
   Tech group           Fuel system               Catalyst             Air injection                EGR         
----------------------------------------------------------------------------------------------------------------
1................  Multi.................  3W....................  No Air................  EGR.                 
2................  Multi.................  3W....................  No Air................  No EGR.              
3................  TBI...................  3W....................  No Air................  EGR.                 
4................  Multi.................  3W+OX.................  Air...................  EGR.                 
5................  Multi.................  3W....................  Air...................  EGR.                 
6................  TBI...................  3W....................  Air...................  EGR.                 
7................  TBI...................  3W+OX.................  Air...................  EGR.                 
8................  TBI...................  3W....................  No Air................  No EGR.              
9................  Carb..................  3W+OX.................  Air...................  EGR.                 
----------------------------------------------------------------------------------------------------------------

Legend:

Fuel system:
    Multi=Multi-point fuel injection
    TBI=Throttle body fuel injection
    Carb=Carburetted
Catalyst:
    3W=3-Way catalyst
    3W+OX=3-Way catalyst plus an oxidation catalyst
Air Injection:
    Air=Air injection
EGR=Exhaust gas recirculation

    (2) Test vehicles for the higher emitter sub-fleet shall be 
selected from the in-use fleet in accordance with paragraphs (a) and 
(b) of this section and with Sec. 80.59. Test vehicles for the higher 
emitter sub-fleet are not required to follow the pattern established in 
paragraph (d)(1) of this section.
    (3) The minimum test fleet size is 20 vehicles. Half of the 
vehicles tested must be included in the normal emitter sub-fleet and 
half of the vehicles tested must be in the higher emitter sub-fleet. If 
additional vehicles are tested beyond the minimum of twenty vehicles, 
the additional vehicles shall be distributed equally between the normal 
and higher emitter sub-fleets.
    (4) For each emitter group sub-fleet, 70  9.5% of the 
sub-fleet must be LDVs, & 30  9.5% must be LDTs. LDTs 
include light-duty trucks class 1 (LDT1), and light-duty trucks class 2 
(LDT2) up to 8500 lbs GVWR.


Sec. 80.61  [Reserved]


Sec. 80.62  Vehicle test procedures to place vehicles in emitter group 
sub-fleets.

    One of the two following test procedures must be used to screen 
candidate vehicles for their exhaust THC emissions to place them within 
the emitter group sub-fleets in accordance with the requirements of 
Sec. 80.60.
    (a) Candidate vehicles may be tested for their exhaust THC 
emissions using the federal test procedure as detailed in 40 CFR part 
86, with gasoline conforming to requirements detailed in 40 CFR 86.113-
90. The results shall be used in accordance with the requirements in 
Sec. 80.60 to place the vehicles within their respective emitter 
groups.
    (b) Alternatively, candidate vehicles may be screened for their 
exhaust THC emissions with the IM240 short test procedure.\1\ The 
results from the IM240 shall be converted into results comparable with 
the standard exhaust FTP as detailed in this paragraph (b) to place the 
vehicles within their respective emitter groups in accordance with the 
requirements of Sec. 80.60.
---------------------------------------------------------------------------

    \1\EPA Technical Report EPA-AA-TSS-91-1. Copies may be obtained 
by ordering publication number PB92104405 from the National 
Technical Information Service, 5285 Port Royal Road, Springfield, 
Virginia 22161.
---------------------------------------------------------------------------

    (1) A candidate vehicle with IM240 test results <0.367 grams THC 
per vehicle mile shall be classified as a normal emitter.
    (2) A candidate vehicle with IM240 test results 0.367 
grams THC per vehicle mile shall be classified as a higher emitter.


Secs. 80.63-80.64  [Reserved]


Sec. 80.65  General requirements for refiners, importers, and oxygenate 
blenders.

    (a) Date requirements begin. The requirements of this subpart D 
apply to all gasoline produced, imported, transported, stored, sold, or 
dispensed:
    (1) At any location other than retail outlets and wholesale 
purchaser-consumer facilities on or after December 1, 1994; and
    (2) At any location on or after January 1, 1995.
    (b) Certification of gasoline and RBOB. Gasoline or RBOB sold or 
dispensed in a covered area must be certified under Sec. 80.40.
    (c) Standards must be met on either a per-gallon or on an average 
basis. (1) Any refiner or importer, for each batch of reformulated 
gasoline or RBOB it produces or imports, shall meet:
    (i) Those standards and requirements it designated under paragraph 
(d) of this section for per-gallon compliance on a per-gallon basis; 
and
    (ii) Those standards and requirements it designated under paragraph 
(d) of this section for average compliance on an average basis over the 
applicable averaging period; except that
    (iii) Refiners and importers are not required to meet the oxygen 
standard for RBOB.
    (2) Any oxygenate blender, for each batch of reformulated gasoline 
it produces by blending oxygenate with RBOB shall, subsequent to the 
addition of oxygenate, meet the oxygen standard either per-gallon or 
average over the applicable averaging period.
    (3)(i) For each averaging period, and separately for each parameter 
that may be met either per-gallon or on average, any refiner shall 
designate for each refinery, and any importer or oxygenate blender 
shall designate, its gasoline or RBOB as being subject to the standard 
applicable to that parameter on either a per-gallon or average basis. 
For any specific averaging period and parameter all batches of gasoline 
or RBOB shall be designated as being subject to the per-gallon 
standard, or all batches of gasoline and RBOB shall be designated as 
being subject to the average standard. For any specific averaging 
period and parameter a refiner for a refinery, or any importer or 
oxygenate blender, may not designate certain batches as being subject 
to the per-gallon standard and others as being subject to the average 
standard.
    (ii) In the event any refiner for a refinery, or any importer or 
oxygenate blender, fails to meet the requirements of paragraph 
(c)(3)(i) of this section and for a specific averaging period and 
parameter designates certain batches as being subject to the per-gallon 
standard and others as being subject to the average standard, all 
batches produced or imported during the averaging period that were 
designated as being subject to the average standard shall, ab initio, 
be redesignated as being subject to the per- gallon standard. This 
redesignation shall apply regardless of whether the batches in question 
met or failed to meet the per-gallon standard for the parameter in 
question.
    (d) Designation of gasoline. Any refiner or importer of gasoline 
shall designate the gasoline it produces or imports as follows:
    (1) All gasoline produced or imported shall be properly designated 
as either reformulated or conventional gasoline, or as RBOB.
    (2) All gasoline designated as reformulated or as RBOB shall be 
further properly designated as:
    (i) Either VOC-controlled or not VOC-controlled;
    (ii) In the case of gasoline or RBOB designated as VOC-controlled, 
either intended for use in VOC-Control Region 1 or VOC-Control Region 2 
(as defined in Sec. 80.71);
    (iii) Either oxygenated fuels program reformulated gasoline, or not 
oxygenated fuels program reformulated gasoline. Gasoline or RBOB must 
be designated as oxygenated fuels program reformulated gasoline if such 
gasoline:
    (A) Contains more than 2.0 weight percent oxygen; and
    (B) Arrives at a terminal from which gasoline is dispensed into 
trucks used to deliver gasoline to an oxygenated fuels control area 
within five days prior to the beginning of the oxygenated fuels control 
period for that control area;
    (iv) For gasoline or RBOB produced, imported, sold, dispensed or 
used during the period January 1, 1995 through December 31, 1997, 
either as being subject to the simple model standards, or to the 
complex model standards;
    (v) For each of the following parameters, either gasoline or RBOB 
which meets the standard applicable to that parameter on a per-gallon 
basis or on average:
    (A) Toxics emissions performance;
    (B) NOx emissions performance;
    (C) Benzene content;
    (D) With the exception of RBOB, oxygen content;
    (E) In the case of VOC-controlled gasoline or RBOB certified using 
the simple model, RVP; and
    (F) In the case of VOC-controlled gasoline or RBOB certified using 
the complex model, VOC emissions performance; and
    (vi) In the case of RBOB, either as RBOB that may be blended with 
any oxygenate, or RBOB that may be blended with an ether only.
    (3) Each batch of reformulated or conventional gasoline or RBOB 
produced or imported at each refinery or import facility, or each batch 
of blendstock produced and sold or transferred if blendstock accounting 
is required under Sec. 80.101(d)(1)(ii), shall be assigned a number 
(the ``batch number''), consisting of the EPA-assigned refiner, 
importer, or oxygenate blender registration number, the EPA- assigned 
facility registration number, the last two digits of the year in which 
the batch was produced, and a unique number for the batch, beginning 
with the number one for the first batch produced or imported each 
calendar year and each subsequent batch during the calendar year being 
assigned the next sequential number (e.g., 4321-4321-95-001, 4321-4321-
95-002, etc.).
    (e) Determination of properties. (1) Each refiner or importer shall 
determine the value of each of the properties specified in paragraph 
(e)(2)(i) of this section for each batch of reformulated gasoline it 
produces or imports prior to the gasoline leaving the refinery or 
import facility, by collecting and analyzing a representative sample of 
gasoline taken from the batch, using the methodologies specified in 
Sec. 80.46. This collection and analysis shall be carried out either by 
the refiner or importer, or by an independent laboratory. A batch of 
simple model reformulated gasoline may be released by the refiner or 
importer prior to the receipt of the refiner's or importer's test 
results except for test results for oxygen, benzene, and RVP.
    (2) In the event that the values of any of these properties is 
determined by the refiner or importer and by an independent laboratory 
in conformance with the requirements of paragraph (f) of this section:
    (i) The results of the analyses conducted by the refiner or 
importer for such properties shall be used as the basis for compliance 
determinations unless the absolute value of the differences of the test 
results from the two laboratories is larger than the following values: 

------------------------------------------------------------------------
           Fuel property                            Range               
------------------------------------------------------------------------
Sulfur content.....................  25 ppm                             
Aromatics content..................  2.7 vol %                          
Olefins content....................  2.5 vol %                          
Benzene content....................  0.21 vol %                         
Ethanol content....................  0.4 vol %                          
Methanol content...................  0.2 vol %                          
MTBE (and other methyl ethers)       0.6 vol %                          
 content.                                                               
ETBE (and other ethyl ethers)        0.6 vol %                          
 content.                                                               
TAME...............................  0.6 vol %                          
t-Butanol content..................  0.6 vol %                          
RVP................................  0.3 psi                            
50% distillation...................  5 deg.F                            
90% distillation...................  5 deg.F                            
API Gravity........................  0.3 deg.API                        
------------------------------------------------------------------------

    (ii) In the event the values from the two laboratories for any 
property fall outside these ranges, the refiner or importer shall use 
as the basis for compliance determinations:
    (A) The larger of the two values for the property, except the 
smaller of the two results shall be used for MTBE, ethanol, methanol, 
or ETBE for calculating compliance with all requirements and standards 
except RVP; or
    (B) The refiner shall have the gasoline analyzed for the property 
at one additional independent laboratory. If this second independent 
laboratory obtains a result for the property that is within the range, 
as listed in paragraph (e)(2)(i) of this section, of the refiner's or 
importer's result for this property, then the refiner's or importer's 
result shall be used as the basis for compliance determinations.
    (f) Independent analysis requirement. (1) Any refiner or importer 
of reformulated gasoline or RBOB shall carry out a program of 
independent sample collection and analyses for the reformulated 
gasoline it produces or imports, which meets the requirements of one of 
the following two options:
    (i) Option 1. The refiner or importer shall, for each batch of 
reformulated gasoline or RBOB that is produced or imported, have the 
value for each property specified in paragraph (e)(2)(i) of this 
section determined by an independent laboratory that collects and 
analyzes a representative sample from the batch using the methodologies 
specified in Sec. 80.46.
    (ii) Option 2. The refiner or importer shall have a periodic 
independent testing program carried out for all reformulated gasoline 
produced or imported, which shall consist of the following:
    (A) An independent laboratory shall collect a representative sample 
from each batch of reformulated gasoline that the refiner or importer 
produces or imports;
    (B) EPA will identify up to ten percent of the total number of 
samples collected under paragraph (f)(1)(ii)(A) of this section; and
    (C) The designated independent laboratory shall, for each sample 
identified by EPA under paragraph (f)(1)(ii)(B) of this section, 
determine the value for each property using the methodologies specified 
in Sec. 80.46.
    (2)(i) Any refiner or importer shall designate one independent 
laboratory for each refinery or import facility at which reformulated 
gasoline or RBOB is produced or imported. This independent laboratory 
will collect samples and perform analyses in compliance with the 
requirements of this paragraph (f) of this section.
    (ii) Any refiner or importer shall identify this designated 
independent laboratory to EPA under the registration requirements of 
Sec. 80.76.
    (iii) In order to be considered independent:
    (A) The laboratory shall not be operated by any refiner or 
importer, and shall not be operated by any subsidiary or employee of 
any refiner or importer;
    (B) The laboratory shall be free from any interest in any refiner 
or importer; and
    (C) The refiner or importer shall be free from any interest in the 
laboratory; however
    (D) Notwithstanding the restrictions in paragraphs (f)(2)(iii) (A) 
through (C) of this section, a laboratory shall be considered 
independent if it is owned or operated by a gasoline pipeline company, 
regardless of ownership or operation of the gasoline pipeline company 
by refiners or importers, provided that such pipeline company is owned 
and operated by four or more refiners or importers.
    (iv) Use of a laboratory that is debarred, suspended, or proposed 
for debarment pursuant to the Governmentwide Debarment and Suspension 
regulations, 40 CFR part 32, or the Debarment, Suspension and 
Ineligibility provisions of the Federal Acquisition Regulations, 48 CFR 
part 9, subpart 9.4, shall be deemed noncompliance with the 
requirements of this paragraph (f).
    (v) Any laboratory that fails to comply with the requirements of 
this paragraph (f) shall be subject to debarment or suspension under 
Governmentwide Debarment and Suspension regulations, 40 CFR part 32, or 
the Debarment, Suspension and Ineligibility regulations, Federal 
Acquisition Regulations, 48 CFR part 9, subpart 9.4.
    (3) Any refiner or importer shall, for all samples collected or 
analyzed pursuant to the requirements of this paragraph (f), cause its 
designated independent laboratory:
    (i) At the time the designated independent laboratory collects a 
representative sample from a batch of reformulated gasoline, to:
    (A) Obtain the refiner's or importer's assigned batch number for 
the batch being sampled;
    (B) Determine the volume of the batch;
    (C) Determine the identification number of the gasoline storage 
tank or tanks in which the batch was stored at the time the sample was 
collected;
    (D) Determine the date and time the batch became finished 
reformulated gasoline, and the date and time the sample was collected;
    (E) Determine the grade of the batch (e.g., premium, mid-grade, or 
regular); and
    (F) In the case of reformulated gasoline produced through computer-
controlled in-line blending, determine the date and time the blending 
process began and the date and time the blending process ended, unless 
exempt under paragraph (f)(4) of this section;
    (ii) To retain each sample collected pursuant to the requirements 
of this paragraph (f) for a period of 30 days, except that this period 
shall be extended to a period of up to 180 days upon request by EPA;
    (iii) To submit to EPA periodic reports, as follows:
    (A) A report for the period January through March shall be 
submitted by May 31; a report for the period April through June shall 
be submitted by August 31; a report for the period July through 
September shall be submitted by November 30; and a report for the 
period October through December shall be submitted by February 28;
    (B) Each report shall include, for each sample of reformulated 
gasoline that was analyzed pursuant to the requirements of this 
paragraph (f):
    (1) The results of the independent laboratory's analyses for each 
property; and
    (2) The information specified in paragraph (f)(3)(i) of this 
section for such sample; and
    (iv) To supply to EPA, upon EPA's request, any sample collected or 
a portion of any such sample.
    (4) Any refiner that produces reformulated gasoline using computer-
controlled in-line blending equipment is exempt from the independent 
sampling and testing requirements specified in paragraphs (f) (1) 
through (3) of this section, provided that such refiner:
    (i) Obtains from EPA an exemption from these requirements. In order 
to seek such an exemption, the refiner shall submit a petition to EPA, 
such petition to include:
    (A) A description of the refiner's computer-controlled in-line 
blending operation, including a description of:
    (1) The location of the operation;
    (2) The length of time the refiner has used the operation;
    (3) The volumes of gasoline produced using the operation since the 
refiner began the operation or during the previous three years, 
whichever is shorter, by grade;
    (4) The movement of the gasoline produced using the operation to 
the point of fungible mixing, including any points where all or 
portions of the gasoline produced is accumulated in gasoline storage 
tanks;
    (5) The physical lay-out of the operation;
    (6) The automated control system, including the method of 
monitoring and controlling blend properties and proportions;
    (7) Any sampling and analysis of gasoline that is conducted as a 
part of the operation, including on-line, off-line, and composite, and 
a description of the methods of sampling, the methods of analysis, the 
parameters analyzed and the frequency of such analyses, and any 
written, printed, or computer-stored results of such analyses, 
including information on the retention of such results;
    (8) Any sampling and analysis of gasoline produced by the operation 
that occurs downstream from the blending operation prior to fungible 
mixing of the gasoline, including any such sampling and analysis by the 
refiner and by any purchaser, pipeline or other carrier, or by 
independent laboratories;
    (9) Any quality assurance procedures that are carried out over the 
operation; and
    (10) Any occasion(s) during the previous three years when the 
refiner adjusted any physical or chemical property of any gasoline 
produced using the operation downstream from the operation, including 
the nature of the adjustment and the reason the gasoline had properties 
that required adjustment; and
    (B) A description of the independent audit program of the refiner's 
computer-controlled in-line blending operation that the refiner 
proposes will satisfy the requirements of this paragraph (f)(4); and
    (ii) Carries out an independent audit program of the refiner's 
computer-controlled in-line blending operation, such program to 
include:
    (A) For each batch of reformulated gasoline produced using the 
operation, a review of the documents generated that is sufficient to 
determine the properties and volume of the gasoline produced;
    (B) Audits that occur no less frequently than annually;
    (C) Reports of the results of such audits submitted to the refiner, 
and to EPA by the auditor no later than February 28 of each year;
    (D) Audits that are conducted by an auditor that meets the non-
debarred criteria specified in Sec. 80.125 (a) and/or (d); and
    (iii) Complies with any other requirements that EPA includes as 
part of the exemption.
    (g) Marking of conventional gasoline. [Reserved]
    (h) Compliance audits. Any refiner, importer, and oxygenate blender 
of any reformulated gasoline or RBOB shall have the reformulated 
gasoline or RBOB it produced, imported, or blended during each calendar 
year audited for compliance with the requirements of this subpart D, in 
accordance with the requirements of subpart F of this part, at the 
conclusion of each calendar year.
    (i) Exclusion from compliance calculations of gasoline received 
from others. Any refiner for each refinery, any oxygenate blender for 
each oxygenate blending facility, and any importer shall exclude from 
all compliance calculations the volume and properties of any 
reformulated gasoline that is produced at another refinery or oxygenate 
blending facility or imported by another importer.


Sec. 80.66  Calculation of reformulated gasoline properties.

    (a) All volume measurements required by these regulations shall be 
temperature adjusted to 60 degrees Fahrenheit.
    (b) The percentage of oxygen by weight contained in a gasoline 
blend, based upon its percentage oxygenate by volume and density, shall 
exclude denaturants and water.
    (c) The properties of reformulated gasoline consist of per-gallon 
values separately and individually determined on a batch-by-batch basis 
using the methodologies specified in Sec. 80.46 for each of those 
physical and chemical parameters necessary to determine compliance with 
the standards to which the gasoline is subject, and per-gallon values 
for the VOC, NOX, and toxics emissions performance standards to 
which the gasoline is subject.
    (d) Per-gallon oxygen content shall be determined based upon the 
weight percent oxygen of a representative sample of gasoline, using the 
method set forth in Sec. 80.46(g). The total oxygen content associated 
with a batch of gasoline (in percent-gallons) is calculated by 
multiplying the weight percent oxygen content times the volume.
    (e) Per-gallon benzene content shall be determined based upon the 
volume percent benzene of a representative sample of a batch of 
gasoline by the method set forth in Sec. 80.46(e). The total benzene 
content associated with a batch of gasoline (in percent-gallons) is 
calculated by multiplying the volume percent benzene content times the 
volume.
    (f) Per-gallon RVP shall be determined based upon the measurement 
of RVP of a representative sample of a batch of gasoline by the 
sampling methodologies specified in Appendix D of this part and the 
testing methodology specified in Appendix E of this part. The total RVP 
value associated with a batch of gasoline (in RVP-gallons) is 
calculated by multiplying the RVP times the volume.
    (g) (1) Per-gallon values for VOC and NOX emissions reduction 
shall be calculated using the methodology specified in Sec. 80.46 that 
is appropriate for the gasoline.
    (2) Per-gallon values for toxic emissions performance reduction 
shall be established using:
    (i) For gasoline subject to the simple model, the methodology under 
Sec. 80.42 that is appropriate for the gasoline; and
    (ii) For gasoline subject to the complex model, the methodology 
specified in Sec. 80.46 that is appropriate for the gasoline.
    (3) The total VOC, NOX, and toxic emissions performance 
reduction values associated with a batch of gasoline (in percent 
reduction-gallons) is calculated by multiplying the per-gallon percent 
emissions performance reduction times the volume of the batch.


Sec. 80.67  Compliance on average.

    The requirements of this section apply to all reformulated gasoline 
and RBOB produced or imported for which compliance with one or more of 
the requirements of Sec. 80.41 is determined on average (``averaged 
gasoline'').
    (a) Compliance survey required in order to meet standards on 
average. (1) Any refiner, importer, or oxygenate blender that complies 
with the compliance survey requirements of Sec. 80.68 has the option of 
meeting the standards specified in Sec. 80.41 for average compliance in 
addition to the option of meeting the standards specified in Sec. 80.41 
for per-gallon compliance; any refiner, importer, or oxygenate blender 
that does not comply with the survey requirements must meet the 
standards specified in Sec. 80.41 for per-gallon compliance, and does 
not have the option of meeting standards on average.
    (2)(i)(A) A refiner or importer that produces or imports 
reformulated gasoline that exceeds the average standards for oxygen or 
benzene (but not for other parameters that have average standards) may 
use such gasoline to offset reformulated gasoline which does not 
achieve such average standards, but only if the reformulated gasoline 
that does not achieve such average standards is sold to ultimate 
consumers in the same covered area as was the reformulated gasoline 
which exceeds average standards; provided that
    (B) Prior to the beginning of the averaging period when the 
averaging approach described in paragraph (a)(2)(i)(A) of this section 
is used, the refiner or importer obtains approval from EPA. In order to 
seek such approval, the refiner or importer shall submit a petition to 
EPA, such petition to include:
    (1) The identification of the refiner and refinery, or importer, 
the covered area, and the averaging period; and
    (2) A detailed description of the procedures the refiner or 
importer will use to ensure the gasoline is produced by the refiner or 
is imported by the importer and is used only in the covered area in 
question and is not used in any other covered area, and the record 
keeping, reporting, auditing, and other quality assurance measures that 
will be followed to establish the gasoline is used as intended; and
    (C) The refiner or importer properly completes any requirements 
that are specified by EPA as conditions for approval of the petition.
    (ii) Any refiner or importer that meets the requirements of 
paragraph (a)(2)(i) of this section will be deemed to have satisfied 
the compliance survey requirements of Sec. 80.68 for the covered area 
in question.
    (b) Scope of averaging. (1) Any refiner shall meet all applicable 
averaged standards separately for each of the refiner's refineries;
    (2)(i) Any importer shall meet all applicable averaged standards on 
the basis of all averaged reformulated gasoline and RBOB imported by 
the importer; except that
    (ii) Any importer to whom different standards apply for gasoline 
imported at different facilities by operation of Sec. 80.41(i), shall 
meet the averaged standards separately for the averaged reformulated 
gasoline and RBOB imported into each group of facilities that is 
subject to the same standards; and
    (3) Any oxygenate blender shall meet the averaged standard for 
oxygen separately for each of the oxygenate blender's oxygenate 
blending facilities, except that any oxygenate blender may group the 
averaged reformulated gasoline produced at facilities at which gasoline 
is produced for use in a single covered area.
    (c) RVP and VOC emissions performance reduction compliance on 
average. (1) The VOC-controlled reformulated gasoline and RBOB produced 
at any refinery or imported by any importer during the period January 1 
through September 15 of each calendar year which is designated for 
average compliance for RVP or VOC emissions performance on average must 
meet the standards for RVP (in the case of a refinery or importer 
subject to the simple model standards) or the standards for VOC 
emissions performance reduction (in the case of a refinery or importer 
subject to the complex model standards) which are applicable to that 
refinery or importer as follows:
    (i) Gasoline and RBOB designated for VOC Control Region 1 must meet 
the standards for that Region which are applicable to that refinery or 
importer; and
    (ii) Gasoline and RBOB designated for VOC Control Region 2 must 
meet the standards for that Region which are applicable to that 
refinery or importer.
    (2) In the case of a refinery or importer subject to the simple 
model standards, each gallon of reformulated gasoline and RBOB 
designated as being VOC-controlled may not exceed the maximum standards 
for RVP specified in Sec. 80.41(b) which are applicable to that refiner 
or importer.
    (3) In the case of a refinery or importer subject to the complex 
model standards, each gallon of reformulated gasoline designated as 
being VOC-controlled must equal or exceed the minimum standards for VOC 
emissions performance specified in Sec. 80.41 which are applicable to 
that refinery or importer.
    (d) Toxics emissions reduction and benzene compliance on average. 
(1) The averaging period for the requirements for benzene content and 
toxics emission performance is January 1 through December 31 of each 
year.
    (2) The reformulated gasoline and RBOB produced at any refinery or 
imported by any importer during the toxics emissions performance and 
benzene averaging periods that is designated for average compliance for 
these parameters shall on average meet the standards specified for 
toxics emissions performance and benzene in Sec. 80.41 which are 
applicable to that refinery or importer.
    (3) Each gallon of reformulated gasoline may not exceed the maximum 
standard for benzene content specified in Sec. 80.41 which is 
applicable to that refinery or importer.
    (e) NOX compliance on average. (1) The averaging period for 
NOX emissions performance is January 1 through December 31 of each 
year.
    (2) The requirements of this paragraph (e) apply separately to 
reformulated gasoline and RBOB in the following categories:
    (i) All reformulated gasoline and RBOB that is designated as VOC-
controlled; and
    (ii) All reformulated gasoline and RBOB that is not designated as 
VOC-controlled.
    (3) The reformulated gasoline and RBOB produced at any refinery or 
imported by any importer during the NOX averaging period that is 
designated for average compliance for NOX shall on average meet 
the standards for NOX specified in Sec. 80.41 that are applicable 
to that refinery or importer.
    (4) Each gallon of reformulated gasoline must equal or exceed the 
minimum standards for NOX emissions performance specified in 
Sec. 80.41 which are applicable to that refinery or importer.
    (f) Oxygen compliance on average. (1) The averaging period for the 
oxygen content requirements is January 1 through December 31 of each 
year.
    (2) The requirements of this paragraph (f) apply separately to 
reformulated gasoline in the following categories:
    (i) All reformulated gasoline;
    (ii) All reformulated gasoline that is not designated as being 
OPRG; and
    (iii) In the case of reformulated gasoline certified under the 
simple model, that which is designated as VOC- controlled.
    (3) The reformulated gasoline produced at any refinery or imported 
by any importer during the oxygen averaging period that is designated 
for average compliance for oxygen shall on average meet the standards 
for oxygen specified in Sec. 80.41 that is applicable to that refinery 
or importer.
    (4) The reformulated gasoline that is produced at any oxygenate 
blending facility by blending RBOB with oxygenate that is designated 
for average compliance for oxygen shall on average meet the standards 
for oxygen specified in Sec. 80.41 that is applicable to that oxygenate 
blending facility.
    (5) Each gallon of reformulated gasoline must meet the applicable 
minimum requirements, and in the case of simple model reformulated 
gasoline the minimum and maximum requirements, for oxygen content 
specified in Sec. 80.41.
    (g) Compliance calculation. To determine compliance with the 
averaged standards in Sec. 80.41, any refiner for each of its 
refineries at which averaged reformulated gasoline or RBOB is produced, 
any oxygenate blender for each of its oxygenate blending facilities at 
which oxygen averaged reformulated gasoline is produced, and any 
importer that imports averaged reformulated gasoline or RBOB shall, for 
each averaging period and for each portion of gasoline for which 
standards must be separately achieved, and for each relevant standard, 
calculate:
    (1)(i) The compliance total using the following formula:

TR16FE94.007

where

Vi=the volume of gasoline batch i
std=the standard for the parameter being evaluated
n=the number of batches of gasoline produced or imported during the 
averaging period

and

    (ii) The actual total using the following formula:

TR16FE94.008

where

Vi=the volume of gasoline batch i
parmi=the parameter value of gasoline batch i
n=the number of batches of gasoline produced or imported during the 
averaging period

    (2) For each standard, compare the actual total with the compliance 
total.
    (3) For the VOC, NOX, and toxics emissions performance and 
oxygen standards, the actual totals must be equal to or greater than 
the compliance totals to achieve compliance.
    (4) For RVP and benzene standards, the actual total must be equal 
to or less than the compliance totals to achieve compliance.
    (5) If the actual total for the oxygen standard is less than the 
compliance total, or if the actual total for the benzene standard is 
greater than the compliance total, credits for these parameters must be 
obtained from another refiner, importer or (in the case of oxygen) 
oxygenate blender in order to achieve compliance:
    (i) The total number of oxygen credits required to achieve 
compliance is calculated by subtracting the actual total from the 
compliance total oxygen; and
    (ii) The total number of benzene credits required to achieve 
compliance is calculated by subtracting the compliance total from the 
actual total benzene.
    (6) If the actual total for the oxygen standard is greater than the 
compliance total, or if the actual total for the benzene standard is 
less than the compliance totals, credits for these parameters are 
generated:
    (i) The total number of oxygen credits which may be traded to 
another refinery, importer, or oxygenate blender is calculated by 
subtracting the compliance total from the actual total for oxygen; and
    (ii) The total number of benzene credits which may be traded to 
another refinery or importer is calculated by subtracting the actual 
total from the compliance total for benzene.
    (h) Credit transfers. (1) Compliance with the averaged standards 
specified in Sec. 80.41 for oxygen and benzene (but for no other 
standards or requirements) may be achieved through the transfer of 
oxygen and benzene credits provided that:
    (i) The credits were generated in the same averaging period as they 
are used;
    (ii) The credit transfer takes place no later than fifteen working 
days following the end of the averaging period in which the 
reformulated gasoline credits were generated;
    (iii) The credits are properly created;
    (iv) The credits are transferred directly from the refiner, 
importer, or oxygenate blender that creates the credits to the refiner, 
importer, or oxygenate blender that uses the credits to achieve 
compliance;
    (v) Oxygen credits are generated, transferred, and used:
    (A) In the case of gasoline subject to the simple model standards, 
only in the following categories:
    (1) VOC-controlled, non-OPRG;
    (2) Non-VOC-controlled, non-OPRG;
    (3) Non-VOC-controlled, OPRG; and
    (4) VOC-controlled, OPRG; and
    (B) In the case of gasoline subject to the complex model standards, 
only in the following categories:
    (1) OPRG; and
    (2) Non-OPRG;
    (vi) Oxygen credits generated from gasoline subject to the complex 
model standards are not used to achieve compliance for gasoline subject 
to the simple model standards;
    (vii) Oxygen credits are not used to achieve compliance with the 
minimum oxygen content standards in Sec. 80.41; and
    (viii) Benzene credits are not used to achieve compliance with the 
maximum benzene content standards in Sec. 80.41.
    (2) No party may transfer any credits to the extent such a transfer 
would result in the transferor having a negative credit balance at the 
conclusion of the averaging period for which the credits were 
transferred. Any credits transferred in violation of this paragraph are 
improperly created credits.
    (3) In the case of credits that were improperly created, the 
following provisions apply:
    (i) Improperly created credits may not be used to achieve 
compliance, regardless of a credit transferee's good faith belief that 
it was receiving valid credits;
    (ii) No refiner, importer, or oxygenate blender may create, report, 
or transfer improperly created credits; and
    (iii) Where any credit transferor has in its balance at the 
conclusion of any averaging period both credits which were properly 
created and credits which were improperly created, the properly created 
credits will be applied first to any credit transfers before the 
transferor may apply any credits to achieve its own compliance.
    (i) Average compliance for reformulated gasoline produced or 
imported before January 1, 1995. In the case of any reformulated 
gasoline that is intended to be used beginning January 1, 1995, but 
that is produced or imported prior to that date:
    (1) Any refiner or importer may meet standards specified in 
Sec. 80.41 for average compliance for such gasoline, provided the 
refiner or importer has the option of meeting standards on average for 
1995 under paragraph (a) of this section, and provided the refiner or 
importer elects to be subject to average standards under 
Sec. 80.65(c)(3); and
    (2) Any average compliance gasoline under paragraph (i)(1) of this 
section shall be combined with average compliance gasoline produced 
during 1995 for purposes of compliance calculations under paragraph (g) 
of this section.


Sec. 80.68  Compliance surveys.

    (a) Compliance survey option 1. In order to satisfy the compliance 
survey requirements, any refiner, importer, or oxygenate blender shall 
properly conduct a program of compliance surveys in accordance with a 
survey program plan which has been approved by the Administrator of EPA 
in each covered area which is supplied with any gasoline for which 
compliance is achieved on average that is produced by that refiner or 
oxygenate blender or imported by that importer. Such approval shall be 
based upon the survey program plan meeting the following criteria:
    (1) The survey program shall consist of at least four surveys which 
shall occur during the following time periods: one survey during the 
period January 1 through May 31; two surveys during the period June 1 
through September 15; and one survey during the period September 16 
through December 31.
    (2) The survey program shall meet the criteria stated in paragraph 
(c) of this section.
    (3) In the event that any refiner, importer, or oxygenate blender 
fails to properly carry out an approved survey program, the refiner, 
importer, or oxygenate blender shall achieve compliance with all 
applicable standards on a per-gallon basis for the calendar year in 
which the failure occurs, and may not achieve compliance with any 
standard on an average basis during this calendar year. This 
requirement to achieve compliance per-gallon shall apply ab initio to 
the beginning of any calendar year in which the failure occurs, 
regardless of when during the year the failure occurs.
    (b) Compliance survey option 2. A refiner, importer, or oxygenate 
blender shall be deemed to have satisfied the compliance survey 
requirements described in paragraph (a) of this section if a 
comprehensive program of surveys is properly conducted in accordance 
with a survey program plan which has been approved by the Administrator 
of EPA. Such approval shall be based upon the survey program plan 
meeting the following criteria:
    (1) The initial schedule for the conduct of surveys shall be as 
follows:
    (i) 120 surveys shall be conducted in 1995;
    (ii) 80 surveys shall be conducted in 1996;
    (iii) 60 surveys shall be conducted in 1997;
    (iv) 50 surveys shall be conducted in 1998 and thereafter.
    (2) This initial survey schedule shall be adjusted as follows:
    (i) In the event one or more ozone nonattainment areas in addition 
to the nine specified in Sec. 80.70, opt into the reformulated gasoline 
program, the number of surveys to be conducted in the year the area or 
areas opt into the program and in each subsequent year shall be 
increased according to the following formula:

TR16FE94.009

where:

ANSi = the adjusted number of surveys for year i; i = the opt-in 
year and each subsequent year
NSi = the number of surveys according to the schedule in paragraph 
(b)(1) of this section in year i; i = the opt-in year and each 
subsequent year
Vopt-in = the total volume of gasoline supplied to the opt-in 
covered areas in the year preceding the year of the opt-in
Vorig = the total volume of gasoline supplied to the original nine 
covered areas in the year preceding the year of the opt-in

    (ii) In the event that any covered area fails a survey or survey 
series according to the criteria set forth in paragraph (c) of this 
section, the annual decreases in the numbers of surveys prescribed by 
paragraph (b)(1) of this section, as adjusted by paragraph (b)(2)(i) of 
this section, shall be adjusted as follows in the year following the 
year of the failure. Any such adjustment to the number of surveys shall 
remain in effect so long as any standard for the affected covered area 
has been adjusted to be more stringent as a result of a failed survey 
or survey series. The adjustments shall be calculated according to the 
following formula:

TR16FE94.010

where:

ANSi = the adjusted number of surveys in year i; i = the year 
after the failure and each subsequent year
Vfailed = the total volume of gasoline supplied to the covered 
area which failed the survey or survey series in the year of the 
failure
Vtotal = the total volume of gasoline supplied to all covered 
areas in the year of the failure
    NSi = the number of surveys in year i according to the 
schedule in paragraph (b)(1) of this section and as adjusted by 
paragraph (b)(2)(i) of this section; i = the year after the failure and 
each subsequent year

    (3) The survey program shall meet the criteria stated in paragraph 
(c) of this section.
    (4) On each occasion the comprehensive survey program does not 
occur as specified in the approved plan with regard to any covered 
area:
    (i) Each refiner, importer, and oxygenate blender who supplied any 
reformulated gasoline or RBOB to the covered area and who has not 
satisfied the survey requirements described in paragraph (a) of this 
section shall be deemed to have failed to carry out an approved survey 
program; and
    (ii) The covered area will be deemed to have failed surveys for VOC 
and NOX emissions performance, and survey series for benzene and 
oxygen, and toxic and NOX emissions performance.
    (c) General survey requirements. (1) During the period January 1, 
1995 through December 31, 1997:
    (i) Any sample taken from a retail gasoline storage tank for which 
the three most recent deliveries were of gasoline designated as 
meeting:
    (A) Simple model standards shall be considered a ``simple model 
sample''; or
    (B) Complex model standards shall be considered a ``complex model 
sample.''
    (ii) A survey shall consist of the combination of a simple model 
portion and a complex model portion, as follows:
    (A) The simple model portion of a survey shall consist of all 
simple model samples that are collected pursuant to the applicable 
survey design in a single covered area during any consecutive seven-day 
period and that are not excluded under paragraph (c)(6) of this 
section.
    (B) The complex model portion of a survey shall consist of all 
complex model samples that are collected pursuant to the applicable 
survey design in a single covered area during any consecutive seven-day 
period and that are not excluded under paragraph (c)(6) of this 
section.
    (iii) (A) The simple model portion of each survey shall be 
representative of all gasoline certified using the simple model which 
is being dispensed in the covered area.
    (B) The complex model portion of each survey shall be 
representative of all gasoline certified using the complex model which 
is being dispensed in the covered area.
    (2) Beginning on January 1, 1998:
    (i) A survey shall consist of all samples that are collected 
pursuant to the applicable survey design in a single covered area 
during any consecutive seven-day period and that are not excluded under 
paragraph (c)(6) of this section.
    (ii) A survey shall be representative of all gasoline which is 
being dispensed in the covered area.
    (3) A VOC survey, and prior to January 1, 2000, a NOX survey, 
shall consist of any survey conducted during the period June 1 through 
September 15.
    (4) (i) A toxics, oxygen, and benzene survey series shall consist 
of all surveys conducted in a single covered area during a single 
calendar year.
    (ii) A NOX survey series shall consist of all surveys 
conducted in a single covered area during the periods January 1 through 
May 31, and September 16 through December 31 during a single calendar 
year.
    (5) (i) Each simple model sample included in a survey shall be 
analyzed for oxygenate type and content, benzene content, aromatic 
hydrocarbon content, and RVP in accordance with the methodologies 
specified in Sec. 80.46; and
    (ii) Each complex model sample included in a survey shall be 
analyzed for oxygenate type and content, olefins, benzene, sulfur, and 
aromatic hydrocarbons, E-200, E-300, and RVP in accordance with the 
methodologies specified in Sec. 80.46.
    (6) (i) The results of each survey shall be based upon the results 
of the analysis of each sample collected during the course of the 
survey, unless the sample violates the applicable per-gallon maximum or 
minimum standards for the parameter being evaluated plus any 
enforcement tolerance that applies to the parameter (e.g., a sample 
that violates the benzene per-gallon maximum plus any benzene 
enforcement tolerance but meets other per-gallon maximum and minimum 
standards would be excluded from the benzene survey, but would be 
included in the surveys for parameters other than benzene).
    (ii) Any sample from a survey that violates any standard under 
Sec. 80.41, or that constitutes evidence of the violation of any 
prohibition or requirement under this subpart D, may be used by the 
Administrator in an enforcement action for such violation.
    (7) Each laboratory at which samples in a survey are analyzed shall 
participate in a correlation program with EPA to ensure the validity of 
analysis results.
    (8) (i) The results of each simple model VOC survey shall be 
determined as follows:
    (A) For each simple model sample from the survey, the VOC emissions 
reduction percentage shall be determined based upon the tested values 
for RVP and oxygen for that sample as applied to the VOC emissions 
reduction equation at Sec. 80.42(a)(1) for VOC-Control Region 1 and 
Sec. 80.42(a)(2) for VOC-Control Region 2;
    (B) The VOC emissions reduction survey standard applicable to each 
covered area shall be calculated by using the VOC emissions equation at 
Sec. 80.42(a)(1) with RVP=7.2 and OXCON=2.0 for covered areas located 
in VOC-Control Region 1 and using the VOC emissions equation at 
Sec. 80.42(a)(2) with RVP=8.1 and OXCON=2.0 for covered areas located 
in VOC-Control Region 2; and
    (C) The covered area shall have failed the simple model VOC survey 
if the VOC emissions reduction average of all survey samples is less 
than VOC emissions reduction survey standard calculated under paragraph 
(c)(8)(i)(B) of this section.
    (ii) The results of each complex model VOC emissions reduction 
survey shall be determined as follows:
    (A) For each complex model sample from the survey, the VOC 
emissions reduction percentage shall be determined based upon the 
tested parameter values for that sample and the appropriate methodology 
for calculating VOC emissions reduction at Sec. 80.47; and
    (B) The covered area shall have failed the complex model VOC survey 
if the VOC emissions reduction percentage average of all survey samples 
is less than the applicable per-gallon standard for VOC emissions 
reduction.
    (9) (i) The results of each simple model toxics emissions reduction 
survey series conducted in any covered area shall be determined as 
follows:
    (A) For each simple model sample from the survey series, the toxics 
emissions reduction percentage shall be determined based upon the 
tested parameter values for that sample and the appropriate methodology 
for calculating toxics emissions performance reduction at Sec. 80.42.
    (B) The annual average of the toxics emissions reduction 
percentages for all samples from a survey series shall be calculated 
according to the following formula:

TR16FE94.011

where

AATER = the annual average toxics emissions reduction
TER1,i = the toxics emissions reduction for sample i of gasoline 
collected during the high ozone season
TER2,i = the toxics emissions reduction for sample i of gasoline 
collected outside the high ozone season
n1 = the number of samples collected during the high ozone season
n2 = the number of samples collected outside the high ozone season

    0(C) The covered area shall have failed the simple model toxics 
survey series if the annual average toxics emissions reduction is less 
than the simple model per-gallon standard for toxics emissions 
reduction.
    (ii) The results of each complex model toxics emissions reduction 
survey series conducted in any covered area shall be determined as 
follows:
    (A) For each complex model sample from the survey series, the 
toxics emissions reduction percentage shall be determined based upon 
the tested parameter values for that sample and the appropriate 
methodology for calculating toxics emissions reduction at Sec. 80.47;
    (B) The annual average of the toxics emissions reduction 
percentages for all samples from a survey series shall be calculated 
according to the formula specified in paragraph (c)(8)(i)(B) of this 
section; and
    (C) The covered area shall have failed the complex model toxics 
survey series if the annual average toxics emissions reduction is less 
than the applicable per-gallon complex model standard for toxics 
emissions reduction.
    (10) The results of each NOX emissions reduction survey and 
survey series shall be determined as follows:
    (i) For each sample from the survey and survey series, the NOX 
emissions reduction percentage shall be determined based upon the 
tested parameter values for that sample and the appropriate methodology 
for calculating NOX emissions reduction at Sec. 80.47; and
    (ii) The covered area shall have failed the NOX survey or 
survey series if the NOX emissions reduction percentage average 
for all survey samples is less than the applicable Phase I or Phase II 
complex model per-gallon standard for NOX emissions reduction.
    (11) For any benzene content survey series conducted in any covered 
area the average benzene content for all samples from the survey series 
shall be calculated. If this annual average is greater than 1.000 
percent by volume, the covered area shall have failed a benzene survey 
series.
    (12) For any oxygen content survey series conducted in any covered 
area the average oxygen content for all samples from the survey series 
shall be calculated. If this annual average is less than 2.00 percent 
by weight, the covered area shall have failed an oxygen survey series.
    Each survey program shall:
    (i) Be planned and conducted by a person who is independent of the 
refiner or importer (the surveyor). In order to be considered 
independent:
    (A) The surveyor shall not be an employee of any refiner or 
importer;
    (B) The surveyor shall be free from any obligation to or interest 
in any refiner or importer; and
    (C) The refiner or importer shall be free from any obligation to or 
interest in the surveyor; and
    (ii) Include procedures for selecting sample collection locations, 
numbers of samples, and gasoline compositions which will result in:
    (A) Simple model surveys representing all gasoline certified using 
the simple model being dispensed at retail outlets within the covered 
area during the period of the survey; and
    (B) Complex model surveys representing all gasoline certified using 
the complex model being dispensed at retail outlets within the covered 
area during the period of the survey; and
    (iii) Include procedures such that the number of samples included 
in each survey assures that:
    (A) In the case of simple model surveys, the average levels of 
oxygen, benzene, RVP, and aromatic hydrocarbons are determined with a 
95% confidence level, with error of less than 0.1 psi for RVP, 0.05% 
for benzene (by volume), and 0.1% for oxygen (by weight); and
    (B) In the case of complex model surveys, the average levels of 
oxygen, benzene, RVP, aromatic hydrocarbons, olefins, T-50, T-90, and 
sulfur are determined with a 95% confidence level, with error of less 
than 0.1 psi for RVP, 0.05% for benzene (by volume), 0.1% for oxygen 
(by weight), 0.5% for aromatic hydrocarbons (by volume), 0.5% for 
olefins (by volume), 5  deg.F. for T-50 and T-90, and 10 ppm for 
sulfur; and
    (iv) Require that the surveyor shall:
    (A) Not inform anyone, in advance, of the date or location for the 
conduct of any survey;
    (B) Upon request by EPA made within thirty days following the 
submission of the report of a survey, provide a duplicate of any 
gasoline sample taken during that survey to EPA at a location to be 
specified by EPA each sample to be identified by the name and address 
of the facility where collected, the date of collection, and the 
classification of the sample as simple model or complex model; and
    (C) At any time permit any representative of EPA to monitor the 
conduct of the survey, including sample collection, transportation, 
storage, and analysis; and
    (v) Require the surveyor to submit to EPA a report of each survey, 
within thirty days following completion of the survey, such report to 
include the following information:
    (A) The identification of the person who conducted the survey;
    (B) An attestation by an officer of the surveyor company that the 
survey was conducted in accordance with the survey plan and that the 
survey results are accurate;
    (C) If the survey was conducted for one refiner or importer, the 
identification of that party;
    (D) The identification of the covered area surveyed;
    (E) The dates on which the survey was conducted;
    (F) The address of each facility at which a gasoline sample was 
collected, the date of collection, and the classification of the sample 
as simple model or complex model;
    (G) The results of the analyses of simple model samples for 
oxygenate type and oxygen weight percent, benzene content, aromatic 
hydrocarbon content, and RVP, and the calculated toxics emission 
reduction percentage;
    (H) The results of the analyses of complex model samples for 
oxygenate type and oxygen weight percent, benzene, aromatic 
hydrocarbon, and olefin content, E-200, E-300, and RVP, and the 
calculated VOC, NOX, and toxics emissions reduction percentages;
    (I) The name and address of each laboratory where gasoline samples 
were analyzed;
    (J) A description of the methodology utilized to select the 
locations for sample collection and the numbers of samples collected;
    (K) For any samples which were excluded from the survey, a 
justification for such exclusion; and
    (L) The average toxics emissions reduction percentage for simple 
model samples and the percentage for complex model samples, the average 
benzene and oxygen percentages, for each survey conducted during the 
period June 1 through September 15, the average VOC emissions reduction 
percentage for simple model samples and the percentage for complex 
model samples, and beginning on January 1, 2000, the average NOX 
emissions reduction percentage.
    (14) Each survey shall be conducted at a time and in a covered area 
selected by EPA no earlier than two weeks before the date of the 
survey.
    (15) The procedure for seeking EPA approval for a survey program 
plan shall be as follows:
    (i) The survey program plan shall be submitted to the Administrator 
of EPA for EPA's approval no later than September 1 of the year 
preceding the year in which the surveys will be conducted; and
    (ii) Such submittal shall be signed by a responsible corporate 
officer of the refiner, importer, or oxygenate blender, or in the case 
of a comprehensive survey program plan, by an officer of the 
organization coordinating the survey program.
    (16) (i) No later than December 1 of the year preceding the year in 
which the surveys will be conducted, the contract with the surveyor to 
carry out the entire survey plan shall be in effect, and an amount of 
money necessary to carry out the entire survey plan shall be paid to 
the surveyor or placed into an escrow account with instructions to the 
escrow agent to pay the money over to the surveyor during the course of 
the conduct of the survey plan.
    (ii) No later than December 15 of the year preceding the year in 
which the surveys will be conducted, the Administrator of EPA shall be 
given a copy of the contract with the surveyor, proof that the money 
necessary to carry out the plan has either been paid to the surveyor or 
placed into an escrow account, and if placed into an escrow account, a 
copy of the escrow agreement.


Sec. 80.69  Requirements for downstream oxygenate blending.

    The requirements of this section apply to all reformulated gasoline 
blendstock for oxygenate blending, or RBOB, to which oxygenate is added 
at any oxygenate blending facility.
    (a) Requirements for refiners and importers. For any RBOB produced 
or imported, the refiner or importer of the RBOB shall:
    (1) Produce or import the RBOB such that, when blended with a 
specified type and percentage of oxygenate, it meets the applicable 
standards for reformulated gasoline;
    (2) In order to determine the properties of RBOB for purposes of 
calculating compliance with per-gallon or averaged standards, conduct 
tests on each batch of the RBOB by:
    (i) Adding the specified type and amount of oxygenate to a 
representative sample of the RBOB; and
    (ii) Determining the properties and characteristics of the 
resulting gasoline using the methodology specified in Sec. 80.65(e);
    (3) Carry out the independent analysis requirements specified in 
Sec. 80.65(f);
    (4) Determine properties of the RBOB which are sufficient to allow 
parties downstream from the refinery or import facility to establish, 
through sampling and testing, if the RBOB has been altered or 
contaminated such that it will not meet the applicable reformulated 
gasoline standards subsequent to the addition of the specified type and 
amount of oxygenate;
    (5) Transfer ownership of the RBOB only to an oxygenate blender who 
is registered with EPA as such, or to an intermediate owner with the 
restriction that it only be transferred to a registered oxygenate 
blender;
    (6) Have a contract with each oxygenate blender who receives any 
RBOB produced or imported by the refiner or importer that requires the 
oxygenate blender, or, in the case of a contract with an intermediate 
owner, that requires the intermediate owner to require the oxygenate 
blender to:
    (i) Comply with blender procedures that are specified by the 
contract and are calculated to assure blending with the proper type and 
amount of oxygenate;
    (ii) Allow the refiner or importer to conduct quality assurance 
sampling and testing of the reformulated gasoline produced by the 
oxygenate blender;
    (iii) Stop selling any gasoline found to not comply with the 
standards under which the RBOB was produced or imported; and
    (iv) Carry out the quality assurance sampling and testing that this 
section requires the oxygenate blender to conduct;
    (7) Conduct a quality assurance sampling and testing program to be 
carried out at the facilities of each oxygenate blender who blends any 
RBOB produced or imported by the refiner or importer with any 
oxygenate, to determine whether the reformulated gasoline which has 
been produced through blending complies with the applicable standards, 
using the methodology specified in Sec. 80.46 for this determination.
    (i) The sampling and testing program shall be conducted as follows:
    (A) All samples shall be collected subsequent to the addition of 
oxygenate, and either:
    (1) Prior combining the resulting gasoline with any other gasoline; 
or
    (2) In the case of truck splash blending, subsequent to the 
delivery of the gasoline to a retail outlet or wholesale purchaser-
consumer facility provided that the three most recent deliveries to the 
retail outlet or wholesale purchaser facility were of gasoline produced 
using that refiner's or importer's RBOB, and provided that any 
discrepancy found through the retail outlet or wholesale purchaser 
facility sampling is followed-up with measures reasonably designed to 
discover the cause of the discrepancy; and
    (B) Sampling and testing shall be at one of the following rates:
    (1) In the case of RBOB which is blended with oxygenate in a 
gasoline storage tank, a rate of not less than one sample for every 
400,000 barrels of RBOB produced or imported by that refiner or 
importer that is blended by that blender, or one sample every month, 
whichever is more frequent; or
    (2) In the case of RBOB which is blended with oxygenate in gasoline 
delivery trucks through the use of computer-controlled in-line blending 
equipment, a rate of not less than one sample for every 200,000 barrels 
of RBOB produced or imported by that refiner or importer that is 
blended by that blender, or one sample every three months, whichever is 
more frequent; or
    (3) In the case of RBOB which is blended with oxygenate in gasoline 
delivery trucks without the use of computer-controlled in-line blending 
equipment, a rate of not less than one sample for each 50,000 barrels 
of RBOB produced or imported by that refiner or importer which is 
blended, or one sample per month, whichever is more frequent;
    (ii) In the event the test results for any sample indicate the 
gasoline does not comply with applicable standards (within the ranges 
specified in Sec. 80.70(b)(2)(i)), the refiner or importer shall:
    (A) Immediately take steps to stop the sale of the gasoline that 
was sampled;
    (B) Take steps which are reasonably calculated to determine the 
cause of the noncompliance and to prevent future instances of 
noncompliance;
    (C) Increase the rate of sampling and testing to one of the 
following rates:
    (1) In the case of RBOB which is blended with oxygenate in a 
gasoline storage tank, a rate of not less than one sample for every 
200,000 barrels of RBOB produced or imported by that refiner or 
importer that is blended by that blender, or one sample every two 
weeks, whichever is more frequent; or
    (2) In the case of RBOB which is blended with oxygenate in gasoline 
delivery trucks through the use of computer-controlled in-line blending 
equipment, a rate of not less than one sample for every 100,000 barrels 
of RBOB produced or imported by that refiner or importer that is 
blended by that blender, or one sample every two months, whichever is 
more frequent; or
    (3) In the case of RBOB which is blended with oxygenate in gasoline 
delivery trucks without the use of computer-controlled in-line blending 
equipment, a rate of not less than one sample for each 25,000 barrels 
of RBOB produced or imported by that refiner or importer which is 
blended, or one sample every two weeks, whichever is more frequent;
    (D) Continue the increased frequency of sampling and testing until 
the results of ten consecutive samples and tests indicate the gasoline 
complies with applicable standards, at which time the sampling and 
testing may be conducted at the original frequency;
    (iii) This quality assurance program is in addition to any quality 
assurance requirements carried out by other parties;
    (8) A refiner or importer of RBOB may, in lieu of the contractual 
and quality assurance requirements specified in paragraphs (a) (6) and 
(7) of this section, base its compliance calculations on the following 
assumptions:
    (i) In the case of RBOB designated for any-oxygenate, assume that 
ethanol will be added;
    (ii) In the case of RBOB designated for ether-only, assume that 
MTBE will be added; and
    (iii) In the case of any-oxygenate and ether-only designated RBOB, 
assume that the volume of oxygenate added will be such that the 
resulting reformulated gasoline will have an oxygen content of 2.0 
weight percent;
    (9) Any refiner or importer who does not meet the contractual and 
quality assurance requirements specified in paragraphs (a) (6) and (7) 
of this section, and who does not designate its RBOB as ether-only or 
any-oxygenate, shall base its compliance calculations on the assumption 
that 4.0 volume percent ethanol is added to the RBOB; and
    (10) Specify in the product transfer documentation for the RBOB 
each oxygenate type or types and amount or range of amounts which is 
consistent with the designation of the RBOB as any-oxygenate, or ether-
only, and which, if blended with the RBOB will result in reformulated 
gasoline which:
    (i) Has VOC, toxics, or NOX emissions reduction percentages 
which are no lower than the percentages that formed the basis for the 
refiner's or importer's compliance determination for these parameters;
    (ii) Has a benzene content and RVP level which are no higher than 
the values for these characteristics that formed the basis for the 
refiner's or importer's compliance determinations for these parameters; 
and
    (iii) Will not cause the reformulated gasoline to violate any 
standard specified in Sec. 80.41.
    (b) Requirements for oxygenate blenders. For all RBOB received by 
any oxygenate blender, the oxygenate blender shall:
    (1) Add oxygenate of the type(s) and amount (or within the range of 
amounts) specified in the product transfer documents for the RBOB;
    (2) Designate each batch of the resulting reformulated gasoline as 
meeting the oxygen standard per-gallon or on average;
    (3) Meet the standard requirements specified in Sec. 80.65(c) and 
Sec. 80.67(e), the record keeping requirements specified in Sec. 80.74, 
and the reporting requirements specified in Sec. 80.75; and
    (4) In the case of each batch of reformulated gasoline which is 
designated for compliance with the oxygen standard on average:
    (i) Determine the volume and the weight percent oxygen of the batch 
using the testing methodology specified in Sec. 80.46;
    (ii) Assign a number to the batch (the ``batch number''), beginning 
with the number one for the first batch produced each calendar year and 
each subsequent batch during the calendar year being assigned the next 
sequential number, and such numbers to be preceded by the oxygenate 
blender's registration number, the facility number, and the second two 
digits of the year in which the batch was produced (e.g., 4321-4321-95-
001, 4321-4321-95-002, etc.); and
    (iii) Meet the compliance audit requirements specified in 
Sec. 80.65(h).
    (c) Additional requirements for terminal storage tank blending. Any 
oxygenate blender who produces reformulated gasoline by blending any 
oxygenate with any RBOB in any gasoline storage tank, other than a 
truck used for delivering gasoline to retail outlets or wholesale 
purchaser-consumer facilities, shall, for each batch of reformulated 
gasoline so produced determine the oxygen content and volume of this 
gasoline prior to the gasoline leaving the oxygenate blending facility, 
using the methodology specified in Sec. 80.46.
    (d) Additional requirements for distributors dispensing RBOB into 
trucks for blending. Any distributor who dispenses any RBOB into any 
truck which delivers gasoline to retail outlets or wholesale purchaser-
consumer facilities, shall for such RBOB so dispensed:
    (1) Transfer the RBOB only to an oxygenate blender who has 
registered with the Administrator of EPA as such;
    (2) Transfer any RBOB designated as ether-only RBOB only if the 
distributor has a reasonable basis for knowing the oxygenate blender 
will blend an oxygenate other than ethanol with the RBOB; and
    (3) Obtain from the oxygenate blender the oxygenate blender's EPA 
registration number.
    (e) Additional requirements for oxygenate blenders who blend 
oxygenate in trucks. Any oxygenate blender who obtains any RBOB in any 
gasoline delivery truck shall:
    (1) On each occasion it obtains RBOB from a distributor, supply the 
distributor with the oxygenate blender's EPA registration number;
    (2) Conduct a quality assurance sampling and testing program to 
determine whether the proper type and amount of oxygenate is added to 
RBOB. The program shall be conducted as follows:
    (i) All samples shall be collected subsequent to the addition of 
oxygenate, and either:
    (A) Prior combining the resulting gasoline with any other gasoline; 
or
    (B) Subsequent to the delivery of the gasoline to a retail outlet 
or wholesale purchaser-consumer facility provided that the three most 
recent deliveries to the retail outlet or wholesale purchaser facility 
were of gasoline that was produced by that oxygenate blender and that 
had the same oxygenate requirements, and provided that any discrepancy 
in oxygenate type or amount found through the retail outlet or 
wholesale purchaser facility sampling is followed-up with measures 
reasonably designed to discover the cause of the discrepancy;
    (ii) Sampling and testing shall be at one of the following rates:
    (A) In the case computer-controlled in-line blending is used, a 
rate of not less than one sample per each five hundred occasions RBOB 
and oxygenate are loaded into a truck by that oxygenate blender, or one 
sample every three months, whichever is more frequent; or
    (B) In the case computer-controlled in-line blending is not used, a 
rate of not less than one sample per each one hundred occasions RBOB 
and oxygenate are blended in a truck by that oxygenate blender, or one 
sample per month, whichever is more frequent;
    (iii) Sampling and testing shall be of the gasoline produced 
through one of the RBOB-oxygenate blends produced by that oxygenate 
blender;
    (iv) Samples shall be analyzed for oxygenate type and oxygen 
content using the testing methodology specified at Sec. 80.46; and
    (v) In the event the testing results for any sample indicate the 
gasoline does not contain the specified type and amount of oxygenate 
(within the ranges specified in Sec. 80.70(b)(2)(i)):
    (A) Immediately stop selling (or where possible, to stop any 
transferee of the gasoline from selling) the gasoline which was 
sampled;
    (B) Take steps to determine the cause of the noncompliance;
    (C) Increase the rate of sampling and testing to one of the 
following rates:
    (1) In the case computer-controlled in-line blending is used, a 
rate of not less than one sample per each two hundred and fifty 
occasions RBOB and oxygenate are loaded into a truck by that oxygenate 
blender, or one sample every six weeks, whichever is more frequent; or
    (2) In the case computer-controlled in-line blending is not used, a 
rate of not less than one sample per each fifty occasions RBOB and 
oxygenate are blended in a truck by that oxygenate blender, or one 
sample every two weeks, whichever is more frequent; and
    (D) This increased frequency shall continue until the results of 
ten consecutive samples and tests indicate the gasoline complies with 
applicable standards, at which time the frequency may revert to the 
original frequency.
    (f) Oxygenate blending with OPRG. Notwithstanding the requirements 
for and restrictions on oxygenate blending provided in this section, 
any oxygenate blender may blend oxygenate with reformulated gasoline 
that is designated as OPRG, without meeting the record keeping and 
reporting requirements that otherwise apply to oxygenate blenders, 
provided that the reformulated gasoline so produced is:
    (1) Used in an oxygenated fuels program control area during an 
oxygenated fuels program control period; and
    (2) ``Substantially similar'' under section 211(f)(1) of the Clean 
Air Act, or is permitted under a waiver granted by the Administrator 
under the authority of section 211(f)(4) of the Clean Air Act.


Sec. 80.70  Covered areas.

    For purposes of subparts D, E, and F of this part, the covered 
areas are as follows:
    (a) The Los Angeles-Anaheim-Riverside, California, area, comprised 
of:
    (1) Los Angeles County;
    (2) Orange County;
    (3) Ventura County;
    (4) That portion of San Bernadino County that lies south of 
latitude 35 degrees, 10 minutes north and west of longitude 115 
degrees, 45 minutes west; and
    (5) That portion of Riverside County, which lies to the west of a 
line described as follows:
    (i) Beginning at the northeast corner of Section 4, Township 2 
South, Range 5 East, a point on the boundary line common to Riverside 
and San Bernadino Counties;
    (ii) Then southerly along section lines to the centerline of the 
Colorado River Aqueduct;
    (iii) Then southeasterly along the centerline of said Colorado 
River Aqueduct to the southerly line of Section 36, Township 3 South, 
Range 7 East;
    (iv) Then easterly along the township line to the northeast corner 
of Section 6, Township 4 South, Range 9 East;
    (v) Then southerly along the easterly line of Section 6 to the 
southeast corner thereof;
    (vi) Then easterly along section lines to the northeast corner of 
Section 10, Township 4 South, Range 9 East;
    (vii) Then southerly along section lines to the southeast corner of 
Section 15, Township 4 South, Range 9 East;
    (viii) Then easterly along the section lines to the northeast 
corner of Section 21, Township 4 South, Range 10 East;
    (ix) Then southerly along the easterly line of Section 21 to the 
southeast corner thereof;
    (x) Then easterly along the northerly line of Section 27 to the 
northeast corner thereof;
    (xi) Then southerly along section lines to the southeast corner of 
Section 34, Township 4 South, Range 10 East;
    (xii) Then easterly along the township line to the northeast corner 
of Section 2, Township 5 South, Range 10 East;
    (xiii) Then southerly along the easterly line of Section 2, to the 
southeast corner thereof;
    (xiv) Then easterly along the northerly line of Section 12 to the 
northeast corner thereof;
    (xv) Then southerly along the range line to the southwest corner of 
Section 18, Township 5 South, Range 11 East;
    (xvi) Then easterly along section lines to the northeast corner of 
Section 24, Township 5 South, Range 11 East;
    (xvii) Then southerly along the range line to the southeast corner 
of Section 36, Township 8 South, Range 11 East, a point on the boundary 
line common to Riverside and San Diego Counties.
    (b) San Diego County, California.
    (c) The Greater Connecticut area, comprised of:
    (1) The following Connecticut counties:
    (i) Hartford;
    (ii) Middlesex;
    (iii) New Haven;
    (iv) New London;
    (v) Tolland; and
    (vi) Windham; and
    (2) Portions of certain Connecticut counties, described as follows:
    (i) In Fairfield County, the City of Shelton; and
    (ii) In Litchfield County, all cities and townships except the 
towns of Bridgewater and New Milford.
    (d) The New York-Northern New Jersey-Long Island-Connecticut area, 
comprised of:
    (1) Portions of certain Connecticut counties, described as follows:
    (i) In Fairfield County, all cities and townships except Shelton 
City; and
    (ii) In Litchfield County, the towns of Bridgewater and New 
Milford;
    (2) The following New Jersey counties:
    (i) Bergen;
    (ii) Essex;
    (iii) Hudson;
    (iv) Hunterdon;
    (v) Middlesex;
    (vi) Monmouth;
    (vii) Morris;
    (viii) Ocean;
    (ix) Passaic;
    (x) Somerset;
    (xi) Sussex; and
    (xii) Union; and
    (3) The following New York counties:
    (i) Bronx;
    (ii) Kings;
    (iii) Nassau;
    (iv) New York (Manhattan);
    (v) Queens;
    (vi) Richmond;
    (vii) Rockland;
    (viii) Suffolk; and
    (ix) Westchester.
    (e) The Philadelphia-Wilmington-Trenton area, comprised of:
    (1) The following Delaware counties:
    (i) New Castle; and
    (ii) Kent; and
    (2) Cecil County, Maryland; and
    (3) The following New Jersey counties:
    (i) Burlington;
    (ii) Camden;
    (iii) Cumberland;
    (iv) Gloucester;
    (v) Mercer; and
    (vi) Salem; and
    (4) The following Pennsylvania counties:
    (i) Bucks;
    (ii) Chester;
    (iii) Delaware;
    (iv) Montgomery; and
    (v) Philadelphia.
    (f) The Chicago-Gary-Lake County, Illinois-Indiana-Wisconsin area, 
comprised of:
    (1) The following Illinois counties:
    (i) Cook;
    (ii) Du Page;
    (iii) Kane;
    (iv) Lake;
    (v) McHenry; and
    (vi) Will; and
    (2) Portions of certain Illinois counties, described as follows:
    (i) In Grundy County, the townships of Aux Sable and Goose Lake; 
and
    (ii) In Kendall County, Oswego township; and
    (3) The following Indiana counties:
    (i) Lake; and
    (ii) Porter.
    (g) The Baltimore, Maryland area, comprised of:
    (1) The following Maryland counties:
    (i) Anne Arundel;
    (ii) Baltimore;
    (iii) Carroll;
    (iv) Harford; and
    (v) Howard; and
    (2) The City of Baltimore.
    (h) The Houston-Galveston-Brazoria, Texas area, comprised of the 
following Texas counties:
    (1) Brazoria;
    (2) Fort Bend;
    (3) Galveston;
    (4) Harris;
    (5) Liberty;
    (6) Montgomery;
    (7) Waller; and
    (8) Chambers.
    (i) The Milwaukee-Racine, Wisconsin area, comprised of the 
following Wisconsin counties:
    (1) Kenosha;
    (2) Milwaukee;
    (3) Ozaukee;
    (4) Racine;
    (5) Washington; and
    (6) Waukesha.
    (j) The ozone nonattainment areas listed in this paragraph (j) are 
covered areas beginning on January 1, 1995. The geographic extent of 
each covered area listed in this paragraph (j) shall be the 
nonattainment area boundaries as specified in 40 CFR Part 81, subpart 
C:
    (1) Sussex County, Delaware;
    (2) District of Columbia portion of the Washington ozone 
nonattainment area;
    (3) The following Kentucky counties:
    (i) Boone;
    (ii) Campbell;
    (iii) Jefferson; and
    (iv) Kenton;
    (4) Portions of the following Kentucky counties:
    (i) Bullitt; and
    (ii) Oldham;
    (5) The following Maine counties:
    (i) Androscoggin;
    (ii) Cumberland;
    (iii) Kennebec;
    (iv) Knox;
    (v) Lincoln;
    (vi) Sagadahoc;
    (vii) York;
    (viii) Hancock; and
    (ix) Waldo;
    (6) The following Maryland counties:
    (i) Calvert;
    (ii) Charles;
    (iii) Frederick;
    (iv) Montgomery;
    (v) Prince Georges;
    (vi) Queen Anne's; and
    (vii) Kent;
    (7) The entire State of Massachusetts;
    (8) The following New Hampshire counties:
    (i) Strafford;
    (ii) Merrimack;
    (iii) Hillsborough; and
    (iv) Rockingham;
    (9) The following New Jersey counties:
    (i) Atlantic;
    (ii) Cape May; and
    (iii) Warren;
    (10) The following New York counties:
    (i) Albany;
    (ii) Dutchess;
    (iii) Erie;
    (iv) Essex;
    (v) Greene;
    (vi) Jefferson;
    (vii) Montgomery;
    (viii) Niagara;
    (ix) Rensselaer;
    (x) Saratoga; and
    (xi) Schenectady;
    (11) The following Pennsylvania counties:
    (i) Alleheny;
    (ii) Armstrong;
    (iii) Beaver;
    (iv) Berks;
    (v) Butler;
    (vi) Fayette;
    (vii) Washington;
    (viii) Westmoreland;
    (ix) Adams;
    (x) Blair;
    (xi) Cambria;
    (xii) Carbon;
    (xiii) Columbia;
    (xiv) Cumberland;
    (xv) Dauphin;
    (xvi) Erie;
    (xvii) Lackawanna;
    (xviii) Lancaster;
    (xix) Lebanon;
    (xx) Lehigh;
    (xxi) Luzerne;
    (xxii) Mercer;
    (xxiii) Monroe;
    (xxiv) Northampton;
    (xxv) Perry;
    (xxvi) Somerset;
    (xxvii) Wyoming; and
    (xxviii) York;
    (12) The entire State of Rhode Island;
    (13) The following Texas counties:
    (i) Collin;
    (ii) Dallas;
    (iii) Denton; and
    (iv) Tarrant;
    (14) The following Virginia areas:
    (i) Alexandria;
    (ii) Arlington County;
    (iii) Fairfax;
    (iv) Fairfax County;
    (v) Falls Church;
    (vi) Loudoun County;
    (vii) Manassas;
    (viii) Manassas Park;
    (ix) Prince William County;
    (x) Stafford County;
    (xi) Charles City County;
    (xii) Chesterfield County;
    (xiii) Colonial Heights;
    (xiv) Hanover County;
    (xv) Henrico County;
    (xvi) Hopewell;
    (xvii) Richmond County;
    (xviii) Chesapeake;
    (xix) Hampton;
    (xx) James City County;
    (xxi) Newport News;
    (xxii) Norfolk;
    (xxiii) Poquoson;
    (xxiv) Portsmouth;
    (xxv) Suffolk;
    (xxvi) Virginia Beach;
    (xxvii) Williamsburg; and
    (xxviii) York County; and
    (15) Portions of Smyth County of Virginia.
    (k) Any other area classified under 40 CFR part 81, subpart C as a 
marginal, moderate, serious, or severe ozone nonattainment area may be 
included on petition of the governor of the state in which the area is 
located. Effective one year after an area has been reclassified as a 
severe ozone nonattainment area, such severe area shall also be a 
covered area for purposes of this subpart D.


Sec. 80.71   Descriptions of VOC-control regions.

    (a) Reformulated gasoline covered areas which are located in the 
following states are included in VOC-Control Region 1:

Alabama
Arizona
Arkansas
California
Colorado
District of Columbia
Florida
Georgia
Kansas
Louisiana
Maryland
Mississippi
Missouri
Nevada
New Mexico
North Carolina
Oklahoma
Oregon
South Carolina
Tennessee
Texas
Utah
Virginia

    (b) Reformulated gasoline covered areas which are located in the 
following states are included in VOC-Control Region 2:

Connecticut
Delaware
Idaho
Illinois
Indiana
Iowa
Kentucky
Maine
Massachusetts
Michigan
Minnesota
Montana
Nebraska
New Hampshire
New Jersey
New York
North Dakota
Ohio
Pennsylvania
Rhode Island
South Dakota
Vermont
Washington
West Virginia
Wisconsin
Wyoming

    (c) Reformulated gasoline covered areas which are partially in VOC 
Control Region 1 and partially in VOC Control Region 2 shall be 
included in VOC Control Region 1, except in the case of the 
Philadelphia-Wilmington-Trenton CMSA which shall be included in VOC 
Control Region 2.


Sec. 80.72  [Reserved]


Sec. 80.73  Inability to produce conforming gasoline in extraordinary 
circumstances.

    In appropriate extreme and unusual circumstances (e.g., natural 
disaster or Act of God) which are clearly outside the control of the 
refiner, importer, or oxygenate blender and which could not have been 
avoided by the exercise of prudence, diligence, and due care, EPA may 
permit a refiner, importer, or oxygenate blender, for a brief period, 
to distribute gasoline which does not meet the requirements for 
reformulated gasoline, if:
    (a) It is in the public interest to do so (e.g., distribution of 
the nonconforming gasoline is necessary to meet projected shortfalls 
which cannot otherwise be compensated for);
    (b) The refiner, importer, or oxygenate blender exercised prudent 
planning and was not able to avoid the violation and has taken all 
reasonable steps to minimize the extent of the nonconformity;
    (c) The refiner, importer, or oxygenate blender can show how the 
requirements for reformulated gasoline will be expeditiously achieved;
    (d) The refiner, importer, or oxygenate blender agrees to make up 
air quality detriment associated with the nonconforming gasoline, where 
practicable; and
    (e) The refiner, importer, or oxygenate blender pays to the U.S. 
Treasury an amount equal to the economic benefit of the nonconformity 
minus the amount expended, pursuant to paragraph (d) of this section, 
in making up the air quality detriment.


Sec. 80.74  Record keeping requirements.

    All parties in the gasoline distribution network, as described in 
this section, shall maintain records containing the information as 
required in this section. These records shall be retained for a period 
of five years from the date of creation, and shall be delivered to the 
Administrator of EPA or to the Administrator's authorized 
representative upon request.
    (a) All regulated parties. Any refiner, importer, oxygenate 
blender, carrier, distributor, reseller, retailer, or wholesale-
purchaser who sells, offers for sale, dispenses, supplies, offers for 
supply, stores, transports, or causes the transportation of any 
reformulated gasoline or RBOB, shall maintain records containing the 
following information:
    (1) The product transfer documentation for all reformulated 
gasoline or RBOB for which the party is the transferor or transferee; 
and
    (2) For any sampling and testing on RBOB or reformulated gasoline:
    (i) The location, date, time, and storage tank or truck 
identification for each sample collected;
    (ii) The identification of the person who collected the sample and 
the person who performed the testing;
    (iii) The results of the tests; and
    (iv) The actions taken to stop the sale of any gasoline found not 
to be in compliance, and the actions taken to identify the cause of any 
noncompliance and prevent future instances of noncompliance.
    (b) Refiners and importers. In addition to other requirements of 
this section, any refiner and importer shall, for all reformulated 
gasoline and RBOB produced or imported, maintain records containing the 
following information:
    (1) Results of the tests to determine reformulated gasoline 
properties and characteristics specified in Sec. 80.65;
    (2) Results of the tests for the presence of the marker specified 
in Sec. 80.82;
    (3) The volume of gasoline associated with each of the above test 
results using the method normally employed at the refinery or import 
facility for this purpose;
    (4) In the case of RBOB:
    (i) The results of tests to ensure that, following blending, RBOB 
meets applicable standards; and
    (ii) Each contract with each oxygenate blender to whom the refiner 
or importer transfers RBOB; or
    (iii) Compliance calculations described in Sec. 80.69(a)(8) based 
on an assumed addition of oxygenate;
    (5) In the case of any refinery or importer subject to the simple 
model standards, the calculations used to determine the 1990 baseline 
levels of sulfur, T-90, and olefins, and the calculations used to 
determine compliance with the standards for these parameters; and
    (6) In the case of any refinery or importer subject to the complex 
model standards before January 1, 1998, the calculations used to 
determine the baseline levels of VOC, toxics, and NOx emissions 
performance.
    (c) Refiners, importers and oxygenate blenders of averaged 
gasoline. In addition to other requirements of this section, any 
refiner, importer, and oxygenate blender who produces or imports any 
reformulated gasoline for which compliance with one or more applicable 
standard is determined on average shall maintain records containing the 
following information:
    (1) The calculations used to determine compliance with the relevant 
standards on average, for each averaging period and for each quantity 
of gasoline for which standards must be separately achieved; and
    (2) For any credits bought, sold, traded or transferred pursuant to 
Sec. 80.67(h), the dates of the transactions, the names and EPA 
registration numbers of the parties involved, and the number(s) and 
type(s) of credits transferred.
    (d) Oxygenate blenders. In addition to other requirements of this 
section, any oxygenate blender who blends any oxygenate with any RBOB 
shall, for each occasion such terminal storage tank blending occurs, 
maintain records containing the following information:
    (i) The date, time, location, and identification of the blending 
tank or truck in which the blending occurred;
    (ii) The volume and oxygenate requirements of the RBOB to which 
oxygenate was added; and
    (iii) The volume, type, and purity of the oxygenate which was 
added, and documents which show the source(s) of the oxygenate used.
    (e) Distributors who dispense RBOB into trucks. In addition to 
other requirements of this section, any distributor who dispenses any 
RBOB into a truck used for delivering gasoline to retail outlets shall, 
for each occasion RBOB is dispensed into such a truck, obtain records 
identifying:
    (1) The name and EPA registration number of the oxygenate blender 
that received the RBOB; and
    (2) The volume and oxygenate requirements of the RBOB dispensed.
    (f) Conventional gasoline requirement. In addition to other 
requirements of this section, any refiner and importer shall, for all 
conventional gasoline produced or imported, maintain records showing 
the blending of the marker required under Sec. 80.82 into conventional 
gasoline, and the results of the tests showing the concentration of 
this marker subsequent to its addition.
    (g) Retailers before January 1, 1998. Prior to January 1, 1998 any 
retailer that sells or offers for sale any reformulated gasoline shall 
maintain at each retail outlet the product transfer documentation for 
the most recent three deliveries to the retail outlet of each grade of 
reformulated gasoline sold or offered for sale at the retail outlet, 
and shall make such documentation available to any person conducting 
any gasoline compliance survey pursuant to Sec. 80.68.


Sec. 80.75  Reporting requirements.

    Any refiner, importer, and oxygenate blender shall report as 
specified in this section, and shall report such other information as 
the Administrator may require.
    (a) Quarterly reports for reformulated gasoline. Any refiner or 
importer that produces or imports any reformulated gasoline or RBOB, 
and any oxygenate blender that produces reformulated gasoline meeting 
the oxygen standard on average, shall submit quarterly reports to the 
Administrator for each refinery or oxygenate blending facility at which 
such reformulated gasoline or RBOB was produced and for all such 
reformulated gasoline or RBOB imported by each importer.
    (1) The quarterly reports shall be for all such reformulated 
gasoline or RBOB produced or imported during the following time 
periods:
    (i) The first quarterly report shall include information for 
reformulated gasoline or RBOB produced or imported from January 1 
through March 31, and shall be submitted by May 31 of each year 
beginning in 1995;
    (ii) The second quarterly report shall include information for 
reformulated gasoline or RBOB produced or imported from April 1 through 
June 30, and shall be submitted by August 31 of each year beginning in 
1995;
    (iii) The third quarterly report shall include information for 
reformulated gasoline or RBOB produced or imported from July 1 through 
September 30, and shall be submitted by November 30 of each year 
beginning in 1995; and
    (iv) The fourth quarterly report shall include information for 
reformulated gasoline or RBOB produced or imported from October 1 
through December 31, and shall be submitted by the last day of February 
of each year beginning in 1996.
    (2) The following information shall be included in each quarterly 
report for each batch of reformulated gasoline or RBOB which is 
included under paragraph (a)(1) of this section:
    (i) The batch number;
    (ii) The date of production;
    (iii) The volume of the batch;
    (iv) The grade of gasoline produced (i.e., premium, mid-grade, or 
regular);
    (v) For any refiner or importer:
    (A) Each designation of the gasoline, pursuant to Sec. 80.65; and
    (B) The properties, pursuant to Secs. 80.65 and 80.66;
    (vi) For any importer, the PADD in which the import facility is 
located; and
    (vii) For any oxygenate blender, the oxygen content.
    (3) Information pertaining to gasoline produced or imported during 
1994 shall be included in the first quarterly report in 1995.
    (b) RVP averaging reports. (1) Any refiner or importer that 
produced or imported any reformulated gasoline or RBOB under the simple 
model that was to meet RVP standards on average (``averaged 
reformulated gasoline'') shall submit to the Administrator, with the 
third quarterly report, a report for each refinery or importer for such 
averaged reformulated gasoline or RBOB produced or imported during the 
previous RVP averaging period. This information shall be reported 
separately for the following categories:
    (i) Gasoline or RBOB which is designated as VOC-controlled intended 
for areas in VOC-Control Region 1; and
    (ii) Gasoline or RBOB which is designated as VOC-controlled 
intended for VOC-Control Region 2.
    (2) The following information shall be reported:
    (i) The total volume of averaged reformulated gasoline or RBOB in 
gallons;
    (ii) The compliance total value for RVP; and
    (iii) The actual total value for RVP.
    (c) VOC emissions performance averaging reports. (1) Any refiner or 
importer that produced or imported any reformulated gasoline or RBOB 
under the complex model that was to meet the VOC emissions performance 
standards on average (``averaged reformulated gasoline'') shall submit 
to the Administrator, with the third quarterly report, a report for 
each refinery or importer for such averaged reformulated gasoline 
produced or imported during the previous VOC averaging period. This 
information shall be reported separately for the following categories:
    (i) Gasoline or RBOB which is designated as VOC-controlled intended 
for areas in VOC-Control Region 1; and
    (ii) Gasoline or RBOB which is designated as VOC-controlled 
intended for VOC-Control Region 2.
    (2) The following information shall be reported:
    (i) The total volume of averaged reformulated gasoline or RBOB in 
gallons;
    (ii) The compliance total value for VOC emissions performance; and
    (iii) The actual total value for VOC emissions performance.
    (d) Benzene content averaging reports. (1) Any refiner or importer 
that produced or imported any reformulated gasoline or RBOB that was to 
meet the benzene content standards on average (``averaged reformulated 
gasoline'') shall submit to the Administrator, with the fourth 
quarterly report, a report for each refinery or importer for such 
averaged reformulated gasoline that was produced or imported during the 
previous toxics averaging period.
    (2) The following information shall be reported:
    (i) The volume of averaged reformulated gasoline or RBOB in 
gallons;
    (ii) The compliance total content of benzene;
    (iii) The actual total content of benzene;
    (iv) The number of benzene credits generated as a result of actual 
total benzene being less than compliance total benzene;
    (v) The number of benzene credits required as a result of actual 
total benzene being greater than compliance total benzene;
    (vi) The number of benzene credits transferred to another refinery 
or importer; and
    (vii) The number of benzene credits obtained from another refinery 
or importer.
    (e) Toxics emissions performance averaging reports. (1) Any refiner 
or importer that produced or imported any reformulated gasoline or RBOB 
that was to meet the toxics emissions performance standards on average 
(``averaged reformulated gasoline'') shall submit to the Administrator, 
with the fourth quarterly report, a report for each refinery or 
importer for such averaged reformulated gasoline that was produced or 
imported during the previous toxics averaging period.
    (2) The following information shall be reported:
    (i) The volume of averaged reformulated gasoline or RBOB in 
gallons;
    (ii) The compliance value for toxics emissions performance; and
    (iii) The actual value for toxics emissions performance.
    (f) Oxygen averaging reports. (1) Any refiner, importer, or 
oxygenate blender that produced or imported any reformulated gasoline 
that was to meet the oxygen standards on average (``averaged 
reformulated gasoline'') shall submit to the Administrator, with the 
fourth quarterly report, a report for each refinery and oxygenate 
blending facility at which such averaged reformulated gasoline was 
produced and for all such averaged reformulated gasoline imported by 
each importer during the previous oxygen averaging period.
    (2)(i) The following information shall be included in each report 
required by paragraph (f)(1) of this section:
    (A) The total volume of averaged RBOB in gallons;
    (B) The total volume of averaged reformulated gasoline in gallons;
    (C) The compliance total content for oxygen;
    (D) The actual total content for oxygen;
    (E) The number of oxygen credits generated as a result of actual 
total oxygen being greater than compliance total oxygen;
    (F) The number of oxygen credits required as a result of actual 
total oxygen being less than compliance total oxygen;
    (G) The number of oxygen credits transferred to another refinery, 
importer, or oxygenate blending facility; and
    (H) The number of oxygen credits obtained from another refinery, 
importer, or oxygenate blending facility.
    (ii) The information required by paragraph (f)(2)(i) of this 
section shall be reported separately for the following categories:
    (A) For gasoline subject to the simple model standards:
    (1) Gasoline designated as VOC-controlled and non-oxygenated fuels 
program reformulated gasoline (OPRG);
    (2) Gasoline which is designated as VOC-controlled and non-OPRG;
    (3) Gasoline which is designated as non-VOC-controlled and OPRG; 
and
    (4) Gasoline which is designated as non-VOC-controlled and non-
OPRG; and
    (B) For gasoline subject to the Phase I or Phase II complex model 
standards:
    (1) Gasoline which is designated as OPRG; and
    (2) Gasoline which is designated as non-OPRG.
    (iii) The results of the compliance calculations required in 
Sec. 80.67(f) shall also be included in each report required by 
paragraph (f)(1) of this section, for each of the following categories:
    (A) All reformulated gasoline;
    (B) Gasoline which is designated as non-OPRG; and
    (C) For gasoline subject to the simple model standards, gasoline 
which is designated as VOC-controlled.
    (g) NOX emissions performance averaging reports. (1) Any 
refiner or importer that produced or imported any reformulated gasoline 
or RBOB that was to meet the NOX emissions performance standard on 
average (``averaged reformulated gasoline'') shall submit to the 
Administrator, with the fourth quarterly report, a report for each 
refinery or importer for such averaged reformulated gasoline that was 
produced or imported during the previous NOX averaging period.
    (2) The following information shall be reported:
    (i) The volume of averaged reformulated gasoline or RBOB in 
gallons;
    (ii) The compliance value for NOX emissions performance; and
    (iii) The actual value for NOX emissions performance.
    (3) The information required by paragraph (g)(2) of this section 
shall be reported separately for the following categories:
    (i) Gasoline and RBOB which is designated as VOC-controlled; and
    (ii) Gasoline and RBOB which is not designated as VOC-controlled.
    (h) Credit transfer reports. (1) As an additional part of the 
fourth quarterly report required by this section, any refiner, 
importer, and oxygenate blender shall, for each refinery, importer, or 
oxygenate blending facility, supply the following information for any 
oxygen or benzene credits that are transferred from or to another 
refinery, importer, or oxygenate blending facility:
    (i) The names, EPA-assigned registration numbers and facility 
identification numbers of the transferor and transferee of the credits;
    (ii) The number(s) and type(s) of credits that were transferred; 
and
    (iii) The date(s) of transaction(s).
    (2) For purposes of this paragraph (h), oxygen credit transfers 
shall be reported separately for each of the following oxygen credit 
types:
    (i) For gasoline subject to the simple model standards:
    (A) VOC controlled, oxygenated fuels program reformulated gasoline 
(OPRG) oxygen credits;
    (B) VOC controlled, non-OPRG oxygen credits;
    (C) Non-VOC controlled, OPRG oxygen credits; and
    (D) Non-VOC controlled, non-OPRG oxygen credits; and
    (ii) For gasoline subject to the Phase I or Phase II complex model 
standards:
    (A) OPRG oxygen credits; and
    (B) Non-OPRG oxygen credits.
    (i) Covered areas of gasoline use report. Any refiner or oxygenate 
blender that produced or imported any reformulated gasoline that was to 
meet any reformulated gasoline standard on average (``averaged 
reformulated gasoline'') shall, for each refinery and oxygenate 
blending facility at which such averaged reformulated gasoline was 
produced submit to the Administrator, with the fourth quarterly report, 
a report that contains the identity of each covered area that was 
supplied with any averaged reformulated gasoline produced at each 
refinery or blended by each oxygenate blender during the previous year.
    (j) Additional reporting requirement for certain importers. In the 
case of any importer to whom different standards apply for gasoline 
imported at different facilities, by operation of 
Sec. 80.41(m)(2)(iii), such importer shall submit separate reports for 
gasoline imported into facilities subject to different standards.
    (k) Reporting requirements for early use of the complex model. Any 
refiner for any refinery, or any importer, that elects to be subject to 
complex model standards under Sec. 80.41(i)(1) shall report such 
election in writing to the Administrator no later than sixty days prior 
to the beginning of the calendar year during which such standards would 
apply. This report shall include the refinery's or importer's baseline 
values for VOC, NOX, and toxics emissions performance, in 
milligrams per mile.
    (l) Reports for per-gallon compliance gasoline. In the case of 
reformulated gasoline or RBOB for which compliance with each of the 
standards set forth in Sec. 80.41 is achieved on a per-gallon basis, 
the refiner, importer, or oxygenate blender shall submit to the 
Administrator, by the last day of February of each year beginning in 
1996, a report of the volume of each designated reformulated gasoline 
or RBOB produced or imported during the previous calendar year for 
which compliance is achieved on a per-gallon basis, and a statement 
that each gallon of this reformulated gasoline or RBOB met the 
applicable standards.
    (m) Reports of compliance audits. Any refiner, importer, and 
oxygenate blender shall cause to be submitted to the Administrator, by 
May 31 of each year, the report of the compliance audit required by 
Sec. 80.65(h).
    (n) Report submission. The reports required by this section shall 
be:
    (1) Submitted on forms and following procedures specified by the 
Administrator; and
    (2) Signed and certified as correct by the owner or a responsible 
corporate officer of the refiner, importer, or oxygenate blender.


Sec. 80.76  Registration of refiners, importers or oxygenate blenders.

    (a) Registration with the Administrator of EPA is required for any 
refiner and importer, and any oxygenate blender that produces any 
reformulated gasoline.
    (b) Any person required to register shall do so by November 1, 
1994, or not later than three months in advance of the first date that 
such person will produce or import reformulated gasoline or RBOB, or 
conventional gasoline or applicable blendstocks, whichever is later.
    (c) Registration shall be on forms prescribed by the Administrator, 
and shall include the following information:
    (1) The name, business address, contact name, and telephone number 
of the refiner, importer, or oxygenate blender;
    (2) The address and physical location where the documents which are 
required to be retained by Sec. 80.74 or 80.104 will be kept by the 
refiner, importer, or oxygenate blender; and
    (3) For each separate refinery and oxygenate blending facility:
    (i) The facility name, physical location, contact name, telephone 
number, type of facility, and whether the facility will produce 
reformulated gasoline, RBOB, conventional gasoline or applicable 
blendstocks;
    (ii) The identity of each covered area which is supplied with any 
reformulated gasoline or RBOB produced at the refinery or blending 
facility or imported by the importer; and
    (iii) The name, address, contact name and telephone number of the 
independent laboratory used to meet the independent analysis 
requirements of Sec. 80.65(f).
    (d) EPA will supply a registration number to each refiner, 
importer, and oxygenate blender, and a facility registration number for 
each refinery and oxygenate blending facility that is identified, which 
shall be used in all reports to the Administrator.
    (e)(1) Any refiner, importer, or oxygenate blender shall submit 
updated registration information to the Administrator within thirty 
days of any occasion when the registration information previously 
supplied becomes incomplete or inaccurate; except that
    (2) EPA must be notified in writing of any change in designated 
independent laboratory at least thirty days in advance of such change.


Sec. 80.77  Product transfer documentation.

    On each occasion when any person transfers custody or title to any 
reformulated gasoline or RBOB, other than when gasoline is sold or 
dispensed for use in motor vehicles at a retail outlet or wholesale 
purchaser-consumer facility, the transferor shall provide to the 
transferee documents which include the following information:
    (a) The name and address of the transferor;
    (b) The name and address of the transferee;
    (c) The volume of gasoline which is being transferred;
    (d) The location of the gasoline at the time of the transfer;
    (e) The date of the transfer;
    (f) The proper identification of the gasoline as conventional or 
reformulated;
    (g) In the case of reformulated gasoline or RBOB:
    (1) The proper identification as:
    (i)(A) VOC-controlled for VOC-Control Region 1; or VOC-controlled 
for VOC-Control Region 2; or Not VOC-controlled; or
    (B) In the case of gasoline or RBOB that is VOC-controlled for VOC-
Control Region 1, the gasoline may be identified as suitable for use 
either in VOC-Control Region 1 or VOC-Control Region 2;
    (ii) Oxygenated fuels program reformulated gasoline; or Not 
oxygenated fuels program reformulated gasoline; and
    (iii) Prior to January 1, 1998, certified under the simple model 
standards or certified under the complex model standards; and
    (2) The minimum and/or maximum standards with which the gasoline or 
RBOB conforms for:
    (i) Benzene content;
    (ii) Except for RBOB, oxygen content;
    (iii) In the case of gasoline subject to the simple model 
standards, RVP;
    (iv) In the case of gasoline subject to the complex model 
standards:
    (A) Prior to January 1, 1998, the VOC and NOX emissions 
performance minimums in milligrams per mile; and
    (B) Beginning on January 1, 1998, the VOC and NOx emissions 
performance reduction percentage minimums;
    (h) Prior to January 1, 1998, in the case of gasoline or RBOB 
subject to the complex model standards:
    (1) The name and EPA registration number of the refinery at which 
the gasoline was produced, or importer that imported the gasoline; and
    (2) Instructions that the gasoline or RBOB may not be combined with 
any other gasoline or RBOB that was produced at any other refinery or 
was imported by any other importer;
    (i) In the case of reformulated gasoline blendstock for which 
oxygenate blending is intended:
    (1) Identification of the product as RBOB and not reformulated 
gasoline;
    (2) The designation of the RBOB as suitable for blending with:
    (A) Any-oxygenate;
    (B) Ether-only; or
    (C) Other specified oxygenate type(s) and amount(s); and
    (3) The oxygenate type(s) and amount(s) which the RBOB requires in 
order to meet the properties claimed by the refiner or importer of the 
RBOB;
    (4) Instructions that the RBOB may not be combined with any other 
RBOB except other RBOB having the same requirements for oxygenate 
type(s) and amount(s), or, prior to blending, with reformulated 
gasoline; and
    (j) In the case of transferrers or transferees who are refiners, 
importers or oxygenate blenders, the EPA-assigned registration number 
of those persons.


Sec. 80.78  Controls and prohibitions on reformulated gasoline.

    (a) Prohibited activities. (1) No person may manufacture and sell 
or distribute, offer for sale or distribution, dispense, supply, offer 
for supply, store, transport, or cause the transportation of any 
gasoline represented as reformulated and intended for sale or use in 
any covered area:
    (i) Unless each gallon of such gasoline meets the applicable 
benzene maximum standard specified in Sec. 80.41;
    (ii) Unless each gallon of such gasoline meets the applicable 
oxygen content:
    (A) Minimum standard specified in Sec. 80.41; and
    (B) In the case of gasoline subject to simple model standards, 
maximum standard specified in Sec. 80.41;
    (iii) Unless each gallon is properly designated as oxygenated fuels 
program reformulated gasoline, within any oxygenated gasoline program 
control areas during the oxygenated gasoline control period;
    (iv) Unless the product transfer documentation for such gasoline 
complies with the requirements in Sec. 80.77; and
    (v) During the period May 1 through September 15 for all persons 
except retailers and wholesale purchaser-consumers, and during the 
period June 1 through September 15 for all persons including retailers 
and wholesale purchaser-consumers:
    (A) Unless each gallon of such gasoline is VOC-controlled for the 
proper VOC Control Region, except that gasoline designated for VOC-
Control Region 1 may be used in VOC-Control Region 2;
    (B) Unless each gallon of such gasoline that is subject to simple 
model standards has an RVP which is below the applicable RVP maximum 
specified in Sec. 80.41;
    (C) Unless each gallon of such gasoline that is subject to complex 
model standards has a VOC and NOx emissions reduction percentage 
which is above the applicable minimum specified in Sec. 80.41.
    (2) No refiner or importer may produce or import any gasoline 
represented as reformulated or RBOB, and intended for sale or use in 
any covered area:
    (i) Unless such gasoline meets the definition of reformulated 
gasoline or RBOB; and
    (ii) Unless the properties of such gasoline or RBOB correspond to 
the product transfer documents.
    (3) No person may manufacture and sell or distribute, or offer for 
sale or distribution, dispense, supply, or offer for supply, store, 
transport or cause the transportation of gasoline represented as 
conventional which does not contain at least the minimum concentration 
of the conventional gasoline marker specified in Sec. 80.82.
    (4) Gasoline shall be presumed to be intended for sale or use in a 
covered area unless:
    (i) Product transfer documentation as described in Sec. 80.77 
accompanying such gasoline clearly indicates the gasoline is intended 
for sale and use only outside any covered area; or
    (ii) The gasoline is contained in the storage tank of a retailer or 
wholesale purchaser-consumer outside any covered area.
    (5) No person may combine any reformulated gasoline with any non-
oxygenate blendstock except:
    (i) A person that meets each requirement specified for a refiner 
under this subpart; and
    (ii) The blendstock that is added to reformulated gasoline meets 
all reformulated gasoline standards without regard to the properties of 
the reformulated gasoline to which the blendstock is added.
    (6) No person may add any oxygenate to reformulated gasoline, 
except that oxygenate may be added to reformulated gasoline that is 
designated as OPRG provided that such gasoline is used in an oxygenated 
fuels program control area during an oxygenated fuels control period.
    (7) No person may combine any reformulated gasoline blendstock for 
oxygenate blending with any other gasoline, blendstock, or oxygenate 
except:
    (i) Oxygenate of the type and amount (or within the range of 
amounts) specified by the refiner or importer at the time the RBOB was 
produced or imported; or
    (ii) Other RBOB for which the same oxygenate type and amount (or 
range of amounts) was specified by the refiner or importer.
    (8) No person may combine any VOC-controlled reformulated gasoline 
that is produced using ethanol with any VOC-controlled reformulated 
gasoline that is produced using any other oxygenate during the period 
January 1 through September 15.
    (9) Prior to January 1, 1998:
    (i) No person may combine any reformulated gasoline or RBOB that is 
subject to the simple model standards with any reformulated gasoline or 
RBOB that is subject to the complex model standards, except that such 
gasolines may be combined at a retail outlet or wholesale purchaser-
consumer facility;
    (ii) No person may combine any reformulated gasoline subject to the 
complex model standards that is produced at any refinery or is imported 
by any importer with any other reformulated gasoline that is produced 
at a different refinery or is imported by a different importer, unless 
the other refinery or importer has an identical baseline for meeting 
complex model standards during this period; and
    (iii) No person may combine any RBOB subject to the complex model 
standards that is produced at any refinery or is imported by any 
importer with any RBOB that is produced at a different refinery or is 
imported by a different importer, unless the other refinery or importer 
has an identical baseline for meeting complex model standards during 
this period.
    (10) No person may combine any reformulated gasoline with any 
conventional gasoline and sell the resulting mixture as reformulated 
gasoline.
    (b) Liability. Liability for violations of paragraph (a) of this 
section shall be determined according to the provisions of Sec. 80.79.
    (c) Determination of compliance. Compliance with the standards 
listed in paragraph (a) of this section shall be determined by use of 
one of the testing methodologies specified in Sec. 80.46, except that 
where test results using the testing methodologies specified in 
Sec. 80.46 are not available or where such test results are available 
but are in question, EPA may establish noncompliance with standards 
using any information, including the results of testing using methods 
that are not included in Sec. 80.46.
    (d) Dates controls and prohibitions begin. The controls and 
prohibitions specified in paragraph (a) of this section apply at any 
location other than retail outlets and wholesale purchaser-consumer 
facilities on or after December 1, 1994, at any location on or after 
January 1, 1995.


Sec. 80.79  Liability for violations of the prohibited activities.

    (a) Persons liable. Where the gasoline contained in any storage 
tank at any facility owned, leased, operated, controlled or supervised 
by any refiner, importer, oxygenate blender, carrier, distributor, 
reseller, retailer, or wholesale purchaser-consumer is found in 
violation of the prohibitions described in Sec. 80.78(a), the following 
persons shall be deemed in violation:
    (1) Each refiner, importer, oxygenate blender, carrier, 
distributor, reseller, retailer, or wholesale purchaser-consumer who 
owns, leases, operates, controls or supervises the facility where the 
violation is found;
    (2) Each refiner or importer whose corporate, trade, or brand name, 
or whose marketing subsidiary's corporate, trade, or brand name, 
appears at the facility where the violation is found;
    (3) Each refiner, importer, oxygenate blender, distributor, and 
reseller who manufactured, imported, sold, offered for sale, dispensed, 
supplied, offered for supply, stored, transported, or caused the 
transportation of any gasoline which is in the storage tank containing 
gasoline found to be in violation; and
    (4) Each carrier who dispensed, supplied, stored, or transported 
any gasoline which is in the storage tank containing gasoline found to 
be in violation, provided that EPA demonstrates, by reasonably specific 
showings by direct or circumstantial evidence, that the carrier caused 
the violation.
    (b) Defenses for prohibited activities. (1) In any case in which a 
refiner, importer, oxygenate blender, carrier, distributor, reseller, 
retailer, or wholesale purchaser-consumer would be in violation under 
paragraph (a) of this section, it shall be deemed not in violation if 
it can demonstrate:
    (i) That the violation was not caused by the regulated party or its 
employee or agent;
    (ii) That product transfer documents account for all of the 
gasoline in the storage tank found in violation and indicate that the 
gasoline met relevant requirements; and
    (iii)(A) That it has conducted a quality assurance sampling and 
testing program, as described in paragraph (c) of this section; except 
that
    (B) A carrier may rely on the quality assurance program carried out 
by another party, including the party that owns the gasoline in 
question, provided that the quality assurance program is carried out 
properly.
    (2)(i) Where a violation is found at a facility which is operating 
under the corporate, trade or brand name of a refiner, that refiner 
must show, in addition to the defense elements required by paragraph 
(b)(1) of this section, that the violation was caused by:
    (A) An act in violation of law (other than the Act or this part), 
or an act of sabotage or vandalism;
    (B) The action of any reseller, distributor, oxygenate blender, 
carrier, or a retailer or wholesale purchaser- consumer supplied by any 
of these persons, in violation of a contractual undertaking imposed by 
the refiner designed to prevent such action, and despite periodic 
sampling and testing by the refiner to ensure compliance with such 
contractual obligation; or
    (C) The action of any carrier or other distributor not subject to a 
contract with the refiner but engaged by the refiner for transportation 
of gasoline, despite specification or inspection of procedures and 
equipment by the refiner which are reasonably calculated to prevent 
such action.
    (ii) In this paragraph (b), to show that the violation ``was 
caused'' by any of the specified actions the party must demonstrate by 
reasonably specific showings, by direct or circumstantial evidence, 
that the violation was caused or must have been caused by another.
    (c) Quality assurance program. In order to demonstrate an 
acceptable quality assurance program for reformulated gasoline at all 
points in the gasoline distribution network, other than at retail 
outlets and wholesale purchaser-consumer facilities, a party must 
present evidence:
    (1) Of a periodic sampling and testing program to determine if the 
applicable maximum and/or minimum standards for oxygen, benzene, RVP, 
or VOC or NOX emission performance are met; and
    (2) That on each occasion when gasoline is found in noncompliance 
with one of the requirements referred to in paragraph (c)(1) of this 
section:
    (i) The party immediately ceases selling, offering for sale, 
dispensing, supplying, offering for supply, storing, transporting, or 
causing the transportation of the violating product; and
    (ii) The party promptly remedies the violation (such as by removing 
the violating product or adding more complying product until the 
applicable standards are achieved).


Sec. 80.80  Penalties.

    (a) Any person that violates any requirement or prohibition of 
subpart D, E, or F of this part shall be liable to the United States 
for a civil penalty of not more than the sum of $25,000 for every day 
of each such violation and the amount of economic benefit or savings 
resulting from each such violation.
    (b) Any violation of a standard for average compliance during any 
averaging period, or for per-gallon compliance for any batch of 
gasoline, shall constitute a separate violation for each and every 
standard that is violated.
    (c) Any violation of any standard based upon a multi-day averaging 
period shall constitute a separate day of violation for each and every 
day in the averaging period. Any violation of any credit creation or 
credit transfer requirement shall constitute a separate day of 
violation for each and every day in the averaging period.
    (d)(1)(i) Any violation of any per- gallon standard or of any per-
gallon minimum or per-gallon maximum, other than the standards 
specified in paragraph (e) of this section, shall constitute a separate 
day of violation for each and every day such gasoline giving rise to 
such violations remains any place in the gasoline distribution system, 
beginning on the day that the gasoline that violates such per-gallon 
standard is produced or imported and distributed and/or offered for 
sale, and ending on the last day that any such gasoline is offered for 
sale or is dispensed to any ultimate consumer for use in any motor 
vehicle; unless
    (ii) The violation is corrected by altering the properties and 
characteristics of the gasoline giving rise to the violations and any 
mixture of gasolines that contains any of the gasoline giving rise to 
the violations such that the said gasoline or mixture of gasolines has 
the properties and characteristics that would have existed if the 
gasoline giving rise to the violations had been produced or imported in 
compliance with all per-gallon standards.
    (2) For the purposes of this paragraph (d), the length of time the 
gasoline in question remained in the gasoline distribution system shall 
be deemed to be twenty-five days; unless the respective party or EPA 
demonstrates by reasonably specific showings, by direct or 
circumstantial evidence, that the gasoline giving rise to the 
violations remained any place in the gasoline distribution system for 
fewer than or more than twenty-five days.
    (e)(1) Any reformulated gasoline that is produced or imported and 
offered for sale and for which the requirements to determine the 
properties and characteristics under Sec. 80.65(f) is not met, or any 
conventional gasoline for which the refiner or importer does not sample 
and test to determine the relevant properties, shall be deemed:
    (i)(A) Except as provided in paragraph (e)(1)(i)(B) of this section 
to have the following properties:

Sulfur content--970 ppm
Benzene content--5 vol %
RVP (summer)--11 psi
50% distillation--250  deg.F
90% distillation--375  deg.F
Oxygen content--0 wt %
Aromatics content--50 vol %
Olefins content--26 vol %

    (B) To have the following properties in paragraph (e)(1)(i)(A) of 
this section unless the respective party or EPA demonstrates by 
reasonably specific showings, by direct or circumstantial evidence, 
different properties for the gasoline giving rise to the violations; 
and
    (ii) In the case of reformulated gasoline, to have been designated 
as meeting all applicable standards on a per-gallon basis.
    (2) For the purposes of paragraph (e)(1) of this section, any 
refiner or importer that fails to meet the independent analysis 
requirements of Sec. 80.65(f) may not use the results of sampling and 
testing that is carried out by that refiner or importer as direct or 
circumstantial evidence of the properties of the gasoline giving rise 
to the violations, unless this failure was not caused by the refiner or 
importer.
    (f) Any violation of any affirmative requirement or prohibition not 
included in paragraph (c) or (d) of this section shall constitute a 
separate day of violation for each and every day such affirmative 
requirement is not properly accomplished, and/or for each and every day 
the prohibited activity continues. For those violations that may be 
ongoing under subparts D, E, and F of this part, each and every day the 
prohibited activity continues shall constitute a separate day of 
violation.


Sec. 80.81  Enforcement exemptions for California gasoline.

    (a)(1) The requirements of subparts D, E, and F of this part are 
modified in accordance with the provisions contained in this section in 
the case of California gasoline.
    (2) For the purposes of this section, ``California gasoline'' means 
any gasoline that is sold, intended for sale, or made available for 
sale as a motor vehicle fuel in the State of California and that:
    (i) Is manufactured within the State of California;
    (ii) Is imported into the State of California from outside the 
United States; or
    (iii) Is imported into the State of California from inside the 
United States and that is manufactured at a refinery that does not 
produce reformulated gasoline.
    (b)(1) Any refiner, importer, or oxygenate blender of gasoline that 
is sold, intended for sale, or made available for sale as a motor fuel 
in the State of California is, with regard to such gasoline, exempt 
from the compliance survey provisions contained in Sec. 80.68.
    (2) Any refiner, importer, or oxygenate blender of California 
gasoline is, with regard to such gasoline, exempt from the independent 
analysis requirements contained in Sec. 80.65(f).
    (3) Any refiner, importer, or oxygenate blender of California 
gasoline that elects to meet any benzene content, oxygen content, or 
toxics emission reduction standard specified in Sec. 80.41 on average 
for any averaging period specified in Sec. 80.67 that is in part before 
March 1, 1996, and in part subsequent to such date, shall, with regard 
to such gasoline that is produced or imported prior to such date, 
demonstrate compliance with each of the standards specified in 
Sec. 80.41 for each of the following averaging periods in lieu of those 
specified in Sec. 80.67:
    (i) January 1 through December 31, 1995; and
    (ii) March 1, 1995, through February 29, 1996.
    (4) The compliance demonstration required by paragraph (b)(3)(ii) 
of this section shall be submitted no later than May 31, 1996, along 
with reports required to be submitted under Sec. 80.75(a)(1).
    (c) Any refiner, importer, or oxygenate blender of California 
gasoline that is manufactured or imported subsequent to March 1, 1996, 
and that meets the requirements of the California Phase 2 reformulated 
gasoline regulations, as set forth in Title 13, California Code of 
Regulations, sections 2260 et seq., is, with regard to such gasoline, 
exempt from the following requirements (in addition to the requirements 
specified in paragraph (b) of this section):
    (1) The parameter value reconciliation requirements contained in 
Sec. 80.65(e)(2);
    (2) The designation of gasoline requirements contained in 
Sec. 80.65(d);
    (3) The reformulated gasoline and RBOB compliance requirements 
contained in Sec. 80.65(c);
    (4) The marking of conventional gasoline requirements contained in 
Secs. 80.65(g) and 80.82;
    (5) The annual compliance audit requirements contained in 
Sec. 80.65(h);
    (6) The downstream oxygenate blending requirements contained in 
Sec. 80.69;
    (7) The record keeping requirements contained in Secs. 80.74 and 
80.104, except that records required to be maintained under Title 13, 
California Code of Regulations, section 2270, shall be maintained for a 
period of five years from the date of creation and shall be delivered 
to the Administrator or to the Administrator's authorized 
representative upon request;
    (8) The reporting requirements contained in Secs. 80.75 and 80.105;
    (9) The product transfer documentation requirements contained in 
Sec. 80.77; and
    (10) The compliance attest engagement requirements contained in 
subpart F of this part.
    (d) Any refiner, importer, or oxygenate blender that produces or 
imports gasoline that is sold, intended for sale, or made available for 
sale as a motor vehicle fuel in the State of California subsequent to 
March 1, 1996, shall demonstrate compliance with the standards 
specified in Secs. 80.41 and 80.90 by excluding the volume and 
properties of such gasoline from all conventional gasoline and 
reformulated gasoline that it produces or imports that is not sold, 
intended for sale, or made available for sale as a motor vehicle fuel 
in the State of California subsequent to such date. The exemption 
provided in this section does not exempt any refiner or importer from 
demonstrating compliance with such standards for all gasoline that it 
produces or imports.
    (e)(1) The exemption provisions contained in paragraphs (b)(2), 
(b)(3), and (c) of this section shall not apply under the circumstances 
set forth in paragraphs (e)(2) and (e)(3) of this section.
    (2)(i) Such exemption provisions shall not apply to any refiner, 
importer, or oxygenate blender of California gasoline if any gasoline 
formulation that it produces or imports is certified under Title 13, 
California Code of Regulations, section 2265 or section 2266, unless 
such refiner, importer, or oxygenate blender within 30 days of the 
issuance of such certification:
    (A) Notifies the Administrator of such certification;
    (B) Submits to the Administrator copies of the applicable 
certification order issued by the State of California and of the 
application for certification submitted by the regulated party to the 
State of California; and
    (C) Submits to the Administrator a written demonstration that the 
certified gasoline formulation meets each of the complex model per-
gallon standards specified in Sec. 80.41(c).
    (ii) If the Administrator determines that the written demonstration 
submitted under paragraph (e)(2)(i)(C) of this section does not 
demonstrate that the certified gasoline formulation meets each of the 
complex model per-gallon standards specified in Sec. 80.41(c), the 
Administrator shall provide notice to the party (by first class mail) 
of such determination and of the date on which the exemption provisions 
specified in paragraph (e)(1) of this section shall no longer be 
applicable, which date shall be no earlier than 90 days after the date 
of the Administrator's notification.
    (3)(i) Such exemption provisions shall not apply to any refiner, 
importer, or oxygenate blender of California gasoline who has been 
assessed a civil, criminal or administrative penalty for a violation of 
subpart D, E or F of this part or for a violation of the California 
Phase 2 reformulated gasoline regulations set forth in Title 13, 
California Code of Regulations, sections 2260 et seq., effective 90 
days after the date of final agency or district court adjudication of 
such penalty assessment.
    (ii) Any refiner, importer, or oxygenate blender subject to the 
provisions of paragraph (e)(3)(i) of this section may submit a petition 
to the Administrator for relief, in whole or in part, from the 
applicability of such provisions, for good cause. Good cause may 
include a showing that the violation for which a penalty was assessed 
was not a substantial violation of the federal or California 
reformulated gasoline regulations.
    (f) In the case of any gasoline that is sold, intended for sale, or 
made available for sale as a motor vehicle fuel in the State of 
California subsequent to March 1, 1996, any person that manufactures, 
sells, offers for sale, dispenses, supplies, offers for supply, stores, 
transports, or causes the transportation of such gasoline is, with 
regard to such gasoline, exempt from the following prohibited 
activities provisions:
    (1) The oxygenated fuels provisions contained in 
Sec. 80.78(a)(1)(iii);
    (2) The product transfer provisions contained in 
Sec. 80.78(a)(1)(iv);
    (3) The oxygenate blending provisions contained in 
Sec. 80.78(a)(7); and
    (4) The segregation of simple and complex model certified gasoline 
provision contained in Sec. 80.78(a)(9).
    (g)(1) Any refiner that operates a refinery located outside the 
State of California at which California gasoline (as defined in 
paragraph (a)(2)(iii) of this section) is produced shall, with regard 
to such gasoline, provide to any person to whom custody or title of 
such gasoline is transferred, and each transferee shall provide to any 
subsequent transferee, documents which include the following 
information:
    (i) The name and address of the transferor;
    (ii) The name and address of the transferee;
    (iii) The volume of gasoline which is being transferred;
    (iv) The location of the gasoline at the time of the transfer;
    (v) The date and time of the transfer;
    (vi) The identification of the gasoline as California gasoline; and
    (vii) In the case of transferrors and transferrees who are 
refiners, importers or oxygenate blenders, the EPA- assigned 
registration number of such persons.
    (2) Each refiner and transferee of such gasoline shall maintain 
copies of the product transfer documents required to be provided by 
paragraph (g)(1) of this section for a period of five years from the 
date of creation and shall deliver such documents to the Administrator 
or to the Administrator's authorized representative upon request.
    (h) For purposes of the batch sampling and analysis requirements 
contained in Sec. 80.65(e)(1), any refiner, importer or oxygenate 
blender of California gasoline may use a sampling and/or analysis 
methodology prescribed in Title 13, California Code of Regulations, 
sections 2260 et seq., in lieu of any applicable methodology specified 
in Sec. 80.66.
    (i) The exemption provisions contained in this section shall not be 
applicable after December 31, 1999.


Sec. 80.82  Conventional gasoline marker [Reserved]


Secs. 80.83-80.89   [Reserved]

Subpart E--Anti-Dumping


Sec. 80.90  Conventional gasoline baseline emissions determination.

    (a) Annual average baseline values. For any facility of a refiner 
or importer of conventional gasoline, the annual average baseline 
values of the facility's exhaust benzene emissions, exhaust toxics 
emissions, NOx emissions, sulfur, olefins and T90 shall be 
determined using the following equation:

TR16FE94.012

where

BASELINE=annual average baseline value of the facility,
SUMRBASE=summer baseline value of the facility,
SUMRVOL=summer baseline gasoline volume of the facility, per 
Sec. 80.91,
WNTRBASE=winter baseline value of the facility,
WNTRVOL=winter baseline gasoline volume of the facility, per 
Sec. 80.91.
    (b) Baseline exhaust benzene emissions--simple model. (1) Simple 
model exhaust benzene emissions of conventional gasoline shall be 
determined using the following equation:

EXHBEN=(1.884+0.949 x BX+0.113 x (AR-BZ))
where

EXHBEN=exhaust benzene emissions,
BZ=fuel benzene value in terms of volume percent (per Sec. 80.91), and
AR=fuel aromatics value in terms of volume percent (per Sec. 80.91).

    (2) The simple model annual average baseline exhaust benzene 
emissions for any facility of a refiner or importer of conventional 
gasoline shall be determined as follows:
    (i) The simple model baseline exhaust benzene emissions shall be 
determined separately for summer and winter using the facility's 
oxygenated individual baseline fuel parameter values for summer and 
winter (per Sec. 80.91), respectively, in the equation specified in 
paragraph (b)(1) of this section.
    (ii) The simple model annual average baseline exhaust benzene 
emissions of the facility shall be determined using the emissions 
values determined in paragraph (b)(2)(i) of this section in the 
equation specified in paragraph (a) of this section.
    (c) Baseline exhaust benzene emissions--complex model. The complex 
model annual average baseline exhaust benzene emissions for any 
facility of a refiner or importer of conventional gasoline shall be 
determined as follows:
    (1) The summer and winter complex model baseline exhaust benzene 
emissions shall be determined separately using the facility's 
oxygenated individual baseline fuel parameter values for summer and 
winter (per Sec. 80.91), respectively, in the appropriate complex model 
for exhaust benzene emissions described in Sec. 80.45.
    (2) The complex model annual average baseline exhaust benzene 
emissions of the facility shall be determined using the emissions 
values determined in paragraph (c)(1) of this section in the equation 
specified in paragraph (a) of this section.
    (d) Baseline exhaust toxics emissions. The annual average baseline 
exhaust toxics emissions for any facility of a refiner or importer of 
conventional gasoline shall be determined as follows:
    (1) The summer and winter baseline exhaust emissions of benzene, 
formaldehyde, acetaldehyde, 1,3-butadiene, and polycyclic organic 
matter shall be determined using the oxygenated individual baseline 
fuel parameter values for summer and winter (per Sec. 80.91), 
respectively, in the appropriate complex model for each exhaust toxic 
(per Sec. 80.45).
    (2) The summer and winter baseline total exhaust toxics emissions 
shall be determined separately by summing the summer and winter 
baseline exhaust emissions of each toxic (per paragraph (d)(1) of this 
section), respectively.
    (3) The annual average baseline exhaust toxics emissions of the 
facility shall be determined using the emissions values determined in 
paragraph (d)(2) of this section in the equation specified in paragraph 
(a) of this section.
    (e) Baseline NOX emissions. The annual average baseline 
NOX emissions for any facility of a refiner or importer of 
conventional gasoline shall be determined as follows:
    (1) The summer and winter baseline NOX emissions shall be 
determined using the baseline individual baseline fuel parameter values 
for summer and winter (per Sec. 80.91), respectively, in the 
appropriate complex model for NOX (per Sec. 80.45).
    (2) The annual average baseline NOX emissions of the facility 
shall be determined using the emissions values determined in paragraph 
(e)(2) of this section in the equation specified in paragraph (a) of 
this section.
    (3) The requirements specified in paragraphs (e) (1) and (2) of 
this section shall be determined separately using the oxygenated and 
nonoxygenated individual baseline fuel parameters, per Sec. 80.91.
    (f) Applicability of Phase I and Phase II models. The requirements 
of paragraphs (d) and (e) of this section shall be determined 
separately for the applicable Phase I and Phase II complex models 
specified in Sec. 80.45.
    (g) Calculation accuracy. Emissions values calculated per the 
requirements of this section shall be determined to four (4) 
significant figures. Sulfur, olefin and T90 values calculated per the 
requirements of this section shall be determined to the same number of 
decimal places as the corresponding value listed in Sec. 80.91(c)(5).


Sec. 80.91  Individual baseline determination.

    (a) Baseline definition. (1) The ``baseline'' or ``individual 
baseline'' of a refinery, refiner or importer, as applicable, shall 
consist of:
    (i) An estimate of the quality, composition and volume of its 1990 
gasoline, or allowable substitute, based on the requirements specified 
in Secs. 80.91 through 80.93; and
    (ii) Its baseline emissions values calculated per paragraph (f) of 
this section; and
    (iii) Its 1990-1993 blendstock-to-gasoline ratios calculated per 
Sec. 80.102.
    (2)(i) The quality and composition of the 1990 gasoline of a 
refinery, refiner or importer, as applicable, shall be the set of 
values of the following fuel parameters: benzene content; aromatic 
content; olefin content; sulfur content; distillation temperature at 50 
and 90 percent by volume evaporated; percent evaporated at 200  deg.F 
and 300  deg.F; oxygen content; RVP.
    (ii) A refiner, per paragraph (b)(3)(i) of this section, shall also 
determine the API gravity of its 1990 gasoline.
    (3) The methodology outlined in this section shall be followed in 
determining a baseline value for each fuel parameter listed in 
paragraph (a)(2) of this section.
    (b) Requirements for refiners, blenders and importers--(1) 
Requirements for producers of gasoline and gasoline blendstocks. (i) A 
refinery engaged in the production of gasoline blendstocks from crude 
oil and/or crude oil derivatives, and the subsequent mixing of those 
blendstocks to form gasoline, shall have its baseline fuel parameter 
values determined from Method 1, 2 and/or 3-type data as described in 
paragraph (c) of this section, provided the refinery was in operation 
for at least 6 months in 1990.
    (ii) A refinery which was in operation for at least 6 months in 
1990, was shut down after 1990, and which restarts after June 15, 1994, 
and for which insufficient 1990 and post-1990 data was collected prior 
to January 1, 1995 from which to determine an individual baseline, 
shall have the values listed in paragraph (c)(5) of this section as its 
individual baseline parameters.
    (iii) A refinery which was in operation for less than 6 months in 
1990 shall have the values listed in paragraph (c)(5) of this section 
as its individual baseline parameters.
    (2) Requirements for producers or importers of gasoline blendstocks 
only. A refiner or importer of gasoline blendstocks which did not 
produce or import gasoline in 1990 and which produces or imports post-
1994 gasoline shall have the values listed in paragraph (c)(5) of this 
section as its individual baseline parameters.
    (3) Requirements for purchasers of gasoline and/or gasoline 
blendstocks. (i) A refiner or refinery, as applicable, solely engaged 
in the production of gasoline from gasoline blendstocks and/or gasoline 
which are simply purchased and blended to form gasoline shall have its 
individual baseline determined using Method 1-type data (per paragraph 
(c) of this section) from every batch of 1990 gasoline.
    (ii) If Method 1-type data on every batch of the refiner's or 
refinery's 1990 gasoline does not exist, that refiner or refinery shall 
have the values listed in paragraph (c)(5) of this section as its 
individual baseline parameters.
    (4) Requirements for importers of gasoline and/or gasoline 
blendstocks. (i) An importer of gasoline shall determine an individual 
baseline value for each fuel parameter listed in paragraph (a)(2) of 
this section using Method 1-type data on every batch of gasoline 
imported by that importer into the United States in 1990.
    (ii) An importer which is also a foreign refiner must determine its 
individual baseline using Method 1, 2 and/or 3-type data (per paragraph 
(c) of this section) if it imported at least 75 percent, by volume, of 
the gasoline produced at its foreign refinery in 1990 into the United 
States in 1990.
    (iii) An importer which cannot meet the criteria of paragraphs 
(b)(4)(i) or (ii) of this section for baseline determination shall have 
the parameter values listed in paragraph (c)(5) of this section as its 
individual baseline parameter values.
    (5) Requirements for exporters of gasoline and/or gasoline 
blendstocks. A refiner shall not include quality or volume data on its 
1990 exports of gasoline blendstocks or gasoline in its baseline 
determination.
    (c) Data types--(1) Method 1-type data.
    (i) Method 1-type data shall consist of quality (composition and 
property data) and volume records of gasoline produced in or shipped 
from the refinery in 1990, excluding exported gasoline. The measured 
fuel parameter values and volumes of batches, or shipments if not batch 
blended, shall be used except that data on produced gasoline which was 
also shipped shall be included only once.
    (ii) Gasoline blendstock which left a facility in 1990 and which 
could become gasoline solely upon the addition of oxygenate shall be 
included in the baseline determination.
    (A) Fuel parameter values of such blendstock shall be accounted for 
as if the gasoline blendstock were blended with ten (10.0) volume 
percent ethanol.
    (B) If the refiner or importer can provide evidence that such 
gasoline blendstock was not blended per paragraph (c)(1)(ii)(A) of this 
section, and that such gasoline blendstock was blended with another 
oxygenate or a different volume of ethanol, the fuel parameter values 
of the final gasoline (including oxygenate) shall be included in the 
baseline determination.
    (C) If the refiner or importer can provide evidence that such 
gasoline blendstock was not blended per paragraph (c)(1)(ii)(A) or (B) 
of this section, and that such gasoline blendstock was sold with out 
further changes downstream, the fuel parameter values of the original 
product shall be included in the baseline determination.
    (iii) Data on 1990 gasoline purchased or otherwise received, 
including intracompany transfers, shall not be included in the baseline 
determination of a refiner's or importer's facility if the gasoline 
exited the receiving refinery unchanged from its arrival state.
    (2) Method 2-type data. Method 2-type data shall consist of 1990 
gasoline blendstock quality data and 1990 blendstock production 
records, specifically the measured fuel parameter values and volumes of 
blendstock used in the production of gasoline within the refinery. 
Blendstock data shall include volumes purchased or otherwise received, 
including intracompany transfers, if the volumes were blended as part 
of the refiner's or importer's 1990 gasoline. Henceforth in Secs. 80.91 
through 80.93, ``blendstock(s)'' or ``gasoline blendstock(s)'' shall 
include those products or streams commercially blended to form 
gasoline.
    (3) Method 3-type data. (i) Method 3-type data shall consist of 
post-1990 gasoline blendstock and/or gasoline quality data and 1990 
blendstock and gasoline production records, specifically the measured 
fuel parameter values and volumes of blendstock used in the production 
of gasoline within the refinery. Blendstock data shall include volumes 
purchased or otherwise received, including intracompany transfers, if 
the volumes were blended as part of the refiner's or importer's 1990 
gasoline.
    (ii) In order to use Method 3-type data, the refiner or importer 
must do all of the following:
    (A) Include a detailed discussion comparing its 1990 and post-1990 
refinery operations and all other differences which would cause the 
1990 and post-1990 fuel parameter values to differ; and
    (B) Perform the appropriate calculations so as to adjust for the 
differences determined in paragraph (c)(3)(ii)(A) of this section; and
    (C) Include a narrative, discussing the methodology and reasoning 
for the adjustments made per paragraph (c)(3)(ii)(B) of this section.
    (iii) In order to use post-1990 gasoline data, either of the 
following must be shown for each blendstock-type included in 1990 
gasoline, excluding butane:
    (A) The post-1990 volumetric fraction of a blendstock is within (+/
-)10.0 percent of the volumetric fraction of that blendstock in 1990 
gasoline. For example, if a 1990 blendstock constituted 30 volume 
percent of 1990 gasoline, this criterion would be met if the post-1990 
volumetric fraction of the blendstock in post-1990 gasoline was 27.0-
33.0 volume percent.
    (B) The post-1990 volumetric fraction of a blendstock is within (+/
-)2.0 volume percent of the absolute value of the 1990 volumetric 
fraction. For example, if a 1990 blendstock constituted 5 volume 
percent of 1990 gasoline, this criterion would be met if the post-1990 
volumetric fraction of the blendstock in post-1990 gasoline was 3-7 
volume percent.
    (iv) If using post-1990 gasoline data, post-1990 gasoline 
blendstock which left a facility and which could become gasoline solely 
upon the addition of oxygenate shall be included in the baseline 
determination, per the requirements specified in paragraph (c)(1)(ii) 
of this section.
    (4) Hierarchy of data use. (i) A refiner or importer must determine 
a baseline fuel parameter value using only Method 1-type data if 
sufficient Method 1-type data is available, per paragraph (d)(1)(ii) of 
this section.
    (ii) If a refiner has insufficient Method 1-type data for a 
baseline parameter value determination, it must supplement that data 
with all available Method 2-type data, until it has sufficient data, 
per paragraph (d)(1)(iii) of this section.
    (iii) If a refiner has insufficient Method 1- and Method 2-type 
data for a baseline parameter value determination, it must supplement 
that data with all available Method 3-type data, until it has 
sufficient data, per paragraph (d)(1)(iii) of this section.
    (iv) The protocol for the determination of baseline fuel parameter 
values in paragraphs (c)(4)(i) through (iii) of this section shall be 
applied to each fuel parameter one at a time.
    (5) Anti-dumping statutory baseline. (i) The summer anti-dumping 
statutory baseline shall have the set of fuel parameter values 
identified as ``summer'' in Sec. 80.45(b)(2). The anti-dumping summer 
API gravity shall be 57.4  deg.API.
    (ii) The winter anti-dumping statutory baseline shall have the set 
of fuel parameter values identified as ``winter'' in Sec. 80.45(b)(2), 
except that winter RVP shall be 8.7 psi. The anti-dumping winter API 
gravity shall be 60.2 API.
    (iii) The annual average anti-dumping statutory baseline shall have 
the following set of fuel parameter values:

Benzene, volume percent--1.60
Aromatics, volume percent--28.6
Olefins, volume percent--10.8
RVP, psi--8.7
T50, degrees F--207
T90, degrees F--332
E200, percent--46
E300, percent--83
Sulfur, ppm--338
API Gravity,  deg.API--59.1

    (d) Data collection and testing requirements--(1) Minimum sampling 
requirements.--(i) General requirements. (A) Data shall have been 
obtained for at least three months of the refiner's or importer's 
production of summer gasoline and at least three months of its 
production of winter gasoline.
    (1) A summer month shall be any month during which the refiner 
produced any gasoline which met the federal summer gasoline volatility 
requirements. Winter shall be any month which could not be considered a 
summer month.
    (2) The three months which compose the summer and the winter data 
do not have to be consecutive nor within the same year.
    (3) If, in 1990, a refiner marketed all of its gasoline only in an 
area or areas which experience no seasonal changes relative to gasoline 
requirements, e.g., Hawaii, only 3 months of data are required.
    (B) Once the minimum sampling requirements have been met, data 
collection may cease. Additional data may only be included for the 
remainder of the calendar year in which the minimum sampling 
requirements were met. In any case, all available data collected up 
until the time data collection ceases must be utilized in the baseline 
determination.
    (C) Less than the minimum requirements specified in paragraph 
(d)(1) of this section may be allowed, upon petition and approval (per 
Sec. 80.93), if it can be shown that the available data is sufficient 
in quality and quantity to use in the baseline determination.
    (ii) Method 1 sampling requirements. At least half of the batches, 
or shipments if not batch blended, in a calendar month shall have been 
sampled over a minimum of six months in 1990.
    (iii) Method 2 sampling requirements. (A) Continuous blendstock 
streams shall have been sampled at least weekly over a minimum of six 
months in 1990.
    (B) For blendstocks produced on a batch basis, at least half of all 
batches of a single blendstock type produced in a calendar month shall 
have been sampled over a minimum of six months in 1990.
    (iv) Method 3 sampling requirements--(A) Blendstock data. (1) Post-
1990 continuous blendstock streams shall have been sampled at least 
weekly over a minimum of six months.
    (2) For post-1990 blendstocks produced on a batch basis, at least 
half of all batches of a single blendstock type produced in a calendar 
month shall have been sampled over a minimum of six months.
    (B) Gasoline data. At least half of the post-1990 batches, or 
shipments if not batch blended, in a calendar month shall have been 
sampled over a minimum of six months in order to use post-1990 gasoline 
data.
    (2) Sampling beyond today's date. The necessity and actual 
occurrence of data collection after today's date must be shown.
    (3) Negligible quantity sampling. Testing of a blendstock stream 
for a fuel parameter listed in this paragraph (d)(3) is not required if 
the refiner can show that the fuel parameter exists in the stream at 
less than or equal to the amount, on average, shown in this paragraph 
(d)(3) for that fuel parameter. Any fuel parameter shown to exist in a 
refinery stream in negligible amounts shall be assigned a value of 0.0:

Aromatics, volume percent--1.0
Benzene, volume percent--0.15
Olefins, volume percent--1.0
Oxygen, weight percent--0.2
Sulfur, ppm--30.0

    (4) Sample compositing. (i) Samples of gasoline or blendstock which 
have been retained, but not analyzed, may be mixed prior to analysis 
and analyzed, as described in paragraphs (d)(4)(iii) (A) through (H) of 
this section, for the required fuel parameters. Samples must be from 
the same season and year and must be of a single grade or of a single 
type of batch-produced blendstock.
    (ii) Blendstock samples of a single blendstock type obtained from 
continuous processes over a calendar month may be mixed together in 
equal volumes to form one blendstock sample and the sample subsequently 
analyzed for the required fuel parameters.
    (iii)(A) Samples shall have been collected and stored per the 
method normally employed at the refinery in order to prevent change in 
product composition with regard to baseline properties and to minimize 
loss of volatile fractions of the sample.
    (B) Properties of the retained samples shall be adjusted for loss 
of butane by comparing the RVP measured right after blending with the 
RVP determined at the time that the supplemental properties are 
measured.
    (C) The volume of each batch or shipment sampled shall have been 
noted and the sum of the volumes calculated to the nearest hundred 
(100) barrels.
    (D) For each batch or shipment sampled, the ratio of its volume to 
the total volume determined in paragraph (d)(4)(iii)(C) of this section 
shall be determined to three (3) decimal places. This shall be the 
volumetric fraction of the shipment in the mixture.
    (E) The total minimum volume required to perform duplicate analyses 
to obtain values of all of the required fuel parameters shall be 
determined.
    (F) The volumetric fraction determined in paragraph (d)(4)(iii)(D) 
of this section for each batch or shipment shall be multiplied by the 
value determined in paragraph (d)(4)(iii)(E) of this section.
    (G) The resulting value determined in paragraph (d)(4)(iii)(F) of 
this section for each batch or shipment shall be the volume of each 
batch or shipment's sample to be added to the mixture. This volume 
shall be determined to the nearest milliliter.
    (H) The appropriate volumes of each shipment's sample shall be 
thoroughly mixed and the solution analyzed per the methods normally 
employed at the refinery.
    (5) Test methods. (i) If the test methods used to obtain fuel 
parameter values of gasoline and gasoline blendstocks differ or are 
otherwise not equivalent in precision or accuracy to the corresponding 
test method specified in Sec. 80.46, results obtained under those 
procedures will only be acceptable, upon petition and approval (per 
Sec. 80.93), if the procedures are or were industry-accepted procedures 
for measuring the properties of gasoline and gasoline blendstocks at 
the time the measurement was made.
    (ii) Oxygen content may have been determined analytically or from 
oxygenate blending records.
    (A) The fuel parameter values, other than oxygen content, specified 
in paragraph (a) of this section, must be established as for any 
blendstock, per the requirements of this paragraph (d).
    (B) All oxygen associated with allowable gasoline oxygenates per 
Sec. 80.2(jj) shall be included in the determination of the baseline 
oxygen content, if oxygen content was determined analytically.
    (C) Oxygen content shall be assumed to be contributed solely by the 
oxygenate which is indicated on the blending records, if oxygen content 
was determined from blending records.
    (6) Data quality. Data may be excluded from the baseline 
determination if it is shown to the satisfaction of the Director of the 
Office of Mobile Sources, or designee, that it is not within the normal 
range of values expected for the gasoline or blendstock sample, 
considering unit configuration, operating conditions, etc.; due to:
    (i) Improper labeling; or
    (ii) Improper testing; or
    (iii) Other reasons as verified by the auditor specified in 
Sec. 80.92.
    (e) Baseline fuel parameter determination--(1) Closely integrated 
gasoline producing facilities. Each refinery or blending facility must 
determine a set of baseline fuel parameter values per this paragraph 
(e). A single set of baseline fuel parameters may be determined, upon 
petition and approval, for two or more facilities under either of the 
following circumstances:
    (i) Two or more refineries or sets of gasoline blendstock-producing 
units of a refiner engaged in the production of gasoline per paragraph 
(b)(1) of this section which are geographically proximate to each 
other, yet not within a single refinery gate, and whose 1990 operations 
were significantly interconnected.
    (ii) A gasoline blending facility operating per paragraph (b)(3) of 
this section received at least 75 percent of its 1990 blendstock volume 
from a single refinery, or from one or more refineries which are part 
of an aggregate baseline per Sec. 80.101(h). The blending facility and 
associated refinery(ies) must be owned by the same refiner.
    (2) Equations--(i) Parameter determinations. Average baseline fuel 
parameters shall be determined separately for summer and winter using 
summer and winter data (per paragraph (d)(1)(i)(A) of this section), 
respectively, in the applicable equation listed in paragraphs (e)(2) 
(ii) through (iv) of this section, except that average baseline winter 
RVP shall be 8.7 psi.
    (ii) Product included in parameter determinations. In each of the 
equations listed in paragraphs (e)(2) (ii) through (iv) of this 
section, the following shall apply:
    (A) All gasoline produced to meet EPA's 1990 summertime volatility 
requirements shall be considered summer gasoline. All other gasoline 
shall be considered winter gasoline.
    (B) (1) Baseline total annual 1990 gasoline volume shall be the 
larger of the total volume of gasoline produced in or shipped from the 
refinery in 1990.
    (2) Baseline summer gasoline volume shall be the total volume of 
low volatility gasoline which met EPA's 1990 summertime volatility 
requirements. Baseline summer gasoline volume shall be determined on 
the same basis (produced or shipped) as baseline total annual gasoline 
volume.
    (3) Baseline winter gasoline volume shall be the baseline total 
annual gasoline volume minus the baseline summer gasoline volume.
    (C) Fuel parameter values shall be determined in the same units and 
at least to the same number of decimal places as the corresponding fuel 
parameter listed in paragraph (c)(5) of this section.
    (D) Volumes shall be reported to the nearest barrel or to the 
degree at which historical records were kept.
    (iii) Method 1. Summer and winter Method 1-type data, per paragraph 
(c)(1) of this section, shall be evaluated separately according to the 
following equation:

TR16FE94.013

where:

Xbs=summer or winter baseline value of fuel parameter X for the 
refinery
s=season, summer or winter, per paragraph (d)(1)(i)(A)(1) of this 
section
g=separate grade of season s gasoline produced by the refinery in 1990
ps=total number of different grades of season s gasoline produced 
by the refinery in 1990
Tgs=total volume of season s grade g gasoline produced in 1990
Ns=total volume of season s gasoline produced by the refinery in 
1990
i=separate batch or shipment of season s 1990 gasoline sampled
ngs=total number of season s samples of grade g gasoline
Xgis=parameter value of grade g gasoline sample i in season s
Vgis=volume of season s grade g gasoline sample i
SGgis=specific gravity of season s grade g gasoline sample i (used 
only for fuel parameters measured on a weight basis)

    (iv) Method 2. Summer and winter Method 2-type data, per paragraph 
(c)(2) of this section, shall be evaluated separately according to the 
following equation:

TR16FE94.014

where

Xbs=Summer or winter baseline value of fuel parameter X for the 
refinery
s=season, summer or winter, per paragraph (d)(1)(i)(A)(1) of this 
section
j=type of blendstock (e.g., reformate, isomerate, alkylate, etc.)
ms=total types of blendstocks in season s 1990 gasoline
Tjs=total 1990 volume of blendstock j produced in the refinery and 
used in the refinery's season s gasoline
Ns=total volume of season s gasoline produced in the refinery in 
1990
i=sample of blendstock j
njs=number of samples of season s blendstock j from continuous 
process streams
Xijs=parameter value of sample i of season s blendstock j
pjs=number of samples of season s batch-produced blendstock j
Vijs=volume of batch of sample i of season s blendstock j
SGijs=specific gravity of sample i of season s blendstock j (used 
only for fuel parameters measured on a weight basis)

    (v) Method 3. (A) Post-1990 Blendstock. Summer and winter Method 3-
type data, per paragraph (c)(3) of this section, shall be evaluated 
separately according to the following equation:

TR16FE94.015

 where

Xbs=Summer or winter baseline value of fuel parameter X for the 
refinery
s=season, summer or winter, per paragraph (d)(1)(i)(A)(1) of this 
section
j=type of blendstock (e.g., reformate, isomerate, alkylate, etc.)
ms=total types of blendstocks in season s 1990 gasoline
Tjs=total 1990 volume of blendstock j produced in the refinery and 
used in the refinery's season s gasoline
Ns=total volume of season s gasoline produced in the refinery in 
1990
i=sample of post-1990 season s blendstock j
njs=number of samples of post-1990 season s blendstock j from 
continuous process streams
Xijs=parameter value of sample i of post-1990 season s blendstock 
j
pjs=number of samples of post-1990 season s batch-produced 
blendstock j
Vijs=volume of post-1990 batch of sample i of season s blendstock 
j
SGijs=specific gravity of sample i of season s blendstock j (used 
only for fuel parameters measured on a weight basis)

    (B) Post-1990 gasoline. Summer and winter Method 3-type gasoline 
data, per paragraph (c)(3) of this section, shall be evaluated 
separately according to the following equation:

TR16FE94.016

where:
Xbs=Summer or winter baseline value of fuel parameter X for the 
refinery
s=season, summer or winter, per paragraph (d)(1)(i)(A)(1) of this 
section
g=separate grade of season s gasoline produced by the refinery in 1990
ps=total number of different grades of season s gasoline produced 
by the refinery in 1990
Tgs=total volume of season s grade g gasoline produced in 1990
Ns=total volume of season s gasoline produced by the refinery in 
1990
i=separate batch or shipment of post-1990 season s gasoline sampled
ngs=total number of samples of post-1990 season s grade g gasoline
Xgis=parameter value of post-1990 grade g season s gasoline sample 
i
Vgis=volume of post-1990 season s grade g gasoline sample i
SGgis=specific gravity of post-1990 season s grade g gasoline 
sample i (used only for fuel parameters measured on a weight basis)

    (3) Percent evaporated determination. (i) Baseline E200 and E300 
values shall be determined directly from actual measurement data.
    (ii) If the data per paragraph (e)(3)(i) of this section are 
unavailable, upon petition and approval, baseline E200 and E300 values 
shall be determined from the following equations using the baseline T50 
and T90 values, if the baseline T50 and T90 values are otherwise 
acceptable:

E200=147.91-(0.49 x T50)
E300=155.47-(0.22 x T90)

    (4) Oxygen in the baseline. Baseline fuel parameter values shall be 
determined on both an oxygenated and non-oxygenated basis.
     (i) If baseline values are determined first on an oxygenated 
basis, per paragraph (e) of this section, the calculations in 
paragraphs (e)(4)(i) (A) through (C) of this section shall be performed 
to determine the value of each baseline parameter on a non-oxygenated 
basis.
    (A) Benzene, aromatic, olefin and sulfur content shall be 
determined on a non-oxygenated basis according to the following 
equation:

TR16FE94.017

where

UV=non-oxygenated parameter value
AV=oxygenated parameter value
OV=1990 oxygenate volume as a percent of total production

    (B) Reid vapor pressure (RVP) shall be determined on a non-
oxygenated basis according to the following equation:

TR16FE94.018

where

UR=non-oxygenated RVP (baseline value)
BR=oxygenated RVP
i=type of oxygenate used in 1990
n=total number of different types of oxygenates used in 1990
OVi=1990 volume, as a percent of total production, of oxygenate i
ORi=blending RVP of oxygenate i

    (C) Test data and engineering judgement shall be used to estimate 
T90, T50, E300 and E200 baseline values on a non-oxygenated basis. 
Allowances shall be made for physical dilution and distillation effects 
only, and not for refinery operational changes, e.g., decreased 
reformer severity required due to the octane value of oxygenate which 
would reduce aromatics.
    (ii) If baseline values are determined first on a non-oxygenated 
basis, the calculations in paragraphs (e)(4)(ii) (A) through (C) of 
this section shall be performed to determine the value of each baseline 
parameter on an oxygenated basis.
    (A) Benzene, aromatic, olefin and sulfur content shall be 
determined on an oxygenated basis according to the following equation:

AV=UV  x  (100-OV)
where

AV=oxygenated parameter value
UV=no-oxygenated parameter value
OV=1990 oxygenate volume as a percent of total production

    (B) Reid vapor pressure (RVP) shall be determined on an oxygenated 
basis according to the following equation:

TR16FE94.019

where

BR=oxygenated RVP
UR=non-oxygenated RVP
i=type of oxygenate
n=total number of different types of oxygenates
OVi=1990 volume, as a percent of total production, of oxygenate i
ORi=blending RVP of oxygenate i

    (C) Test data and engineering judgement shall be used to estimate 
T90, T50, E300 and E200 baseline values on an oxygenated basis. 
Allowances shall be made for physical dilution and distillation effects 
only, and not for refinery operational changes, e.g., decreased 
reformer severity required due to the octane value of oxygenate which 
would reduce aromatics.
    (5) Work-in-progress. A refiner may, upon petition and approval 
(per Sec. 80.93), be allowed to account for work- in-progress at one or 
more of its refineries in 1990 in the determination of that refinery's 
baseline fuel parameters using Method 1, 2 or 3-type data if it meets 
the requirements specified in this paragraph (e)(5).
    (i) Work-in-progress shall include:
    (A) Refinery modification projects involving gasoline blendstock or 
distillate producing units which were under construction in 1990; or
    (B) Refinery modification projects involving gasoline blendstock or 
distillate producing units which were contracted for prior to or in 
1990 such that the refiner was committed to purchasing materials and 
constructing the project.
    (ii) The modifications discussed in paragraph (e)(5)(i) of this 
section must have been initiated with intent of complying with a 
legislative or regulatory environmental requirement enacted or 
promulgated prior to January 1, 1991.
    (iii) When comparing emissions or parameter values determined with 
and without the anticipated work-in-progress adjustment, at least one 
of the following situations results when comparing annual average 
baseline values per Sec. 80.90:
    (A) A 2.5 percent or greater difference in exhaust benzene 
emissions (per Sec. 80.90); or
    (B) A 2.5 percent or greater difference in total exhaust toxics 
emissions (per Sec. 80.90(d)); or
    (C) A 2.5 percent or greater difference in NOX emissions (per 
Sec. 80.90(e)); or
    (D) A 10.0 percent or greater difference in sulfur values; or
    (E) A 10.0 percent or greater difference in olefin values; or
    (F) A 10.0 percent or greater difference in T90 values.
    (iv) The requirements of paragraph (e)(5)(iii) of this section 
shall be determined according to the following equation:

TR16FE94.020

    (v) The capital involved in the work-in-progress is at least:
    (A) 10.0 percent of the refinery's depreciated book value as of the 
work-in-progress start-up date; or
    (B) $10 million.
    (vi) Sufficient data shall have been obtained since reliable 
operation of the work-in-progress was achieved. Such data shall be used 
in the determination of the adjusted baseline fuel parameter and as 
verification of the effect of the work-in-progress.
    (vii) Increases in each of the annual average baseline values (per 
Sec. 80.90) of exhaust benzene emissions, exhaust toxics emissions and 
NOX emissions due to work-in-progress adjustments are limited to 
the larger of:
    (A) The unadjusted annual average baseline value of each emission 
specified in this paragraph (e)(5)(vii); or
    (B) The following values:
    (1) Exhaust benzene emissions, simple model, 6.77;
    (2) Exhaust benzene emissions, complex model, 34.68 mg/mile;
    (3) Exhaust toxics emissions, 53.20 mg/mile in Phase I, 109.7 mg/
mile in Phase II;
    (4) NOX emissions, 750.1 mg/mile in Phase I, 1534. mg/mile in 
Phase II.
    (viii) When compliance is achieved using the simple model (per 
Sec. 80.101), increases in each of the annual average baseline values 
(per Sec. 80.90) of sulfur, olefins and T90 due to work-in-progress 
adjustments are limited to the larger of:
    (A) The unadjusted annual average baseline value of each specified 
fuel parameter specified in this paragraph (e)(5)(viii); or
    (B) The following values:
    (1) Sulfur, 355 ppm;
    (2) Olefins, 11.3 volume percent;
    (3) T90, 349  deg.F.
    (ix) All work-in-progress adjustments must be accompanied by:
    (A) Unadjusted and adjusted fuel parameters, emissions, and 
volumes; and
    (B) A description of the current status of the work-in-progress 
(i.e., the refinery modification project) and the date on which normal 
operations were achieved; and
    (C) A narrative describing the situation, the types of 
calculations, and the reasoning supporting the types of calculations 
done to determine the adjusted values.
    (6) Baseline adjustment for extenuating circumstances. (i) Baseline 
adjustments may be allowed, upon petition and approval (per 
Sec. 80.93), if a refinery had downtime of a gasoline blendstock 
producing unit for 30 days or more in 1990 due to:
    (A) Unplanned, unforeseen circumstances; or
    (B) Non-annual maintenance (turnaround).
    (ii) Fuel parameter and volume adjustments shall be made by 
assuming that the downtime did not occur in 1990.
    (iii) All extenuating circumstance adjustments must be accompanied 
by:
    (A) Unadjusted and adjusted fuel parameters, emissions, and 
volumes; and
    (B) A description of the current status of the extenuating 
circumstance and the date on which normal operations were achieved; and
    (C) A narrative describing the situation, the types of 
calculations, and the reasoning supporting the types of calculations 
done to determine the adjusted values.
    (7) Baseline adjustments for 1990 JP-4 production. (i) Baseline 
adjustments may be allowed, upon petition and approval (per 
Sec. 80.93), if a refinery produced JP-4 jet fuel in 1990 and meets all 
of the following requirements:
    (A) The refinery is the only refinery of a refiner such that it 
cannot form an aggregate baseline with another refinery (per paragraph 
(f) of this section) or all of the refineries of a refiner produced JP-
4 in 1990 and each of the refineries also meets the requirements 
specified in paragraphs (e)(7)(i) (B) and (C) of this section.
    (B) The refinery will not produce reformulated gasoline. If the 
refinery produces reformulated gasoline at any time in a calendar year, 
its compliance baseline shall revert to its unadjusted baseline values 
for that year and all subsequent years.
    (C) The ratio of the refinery's 1990 JP-4 production to its 1990 
gasoline production equals or exceeds 0.5.
    (ii) Fuel parameter and volume adjustments shall be made by 
assuming that no JP-4 was produced in 1990.
    (iii) All adjustments due to 1990 JP-4 production must be 
accompanied by:
    (A) Unadjusted and adjusted fuel parameters, emissions, and 
volumes; and
    (B) A narrative describing the situation, the types of 
calculations, and the reasoning supporting the types of calculations 
done to determine the adjusted values.
    (f) Baseline volume and emissions determination--(1) Individual 
baseline volume. (i) The individual baseline volume of a refinery 
described in paragraph (b)(1)(i) of this section shall be the larger of 
the total gasoline volume produced in or shipped from the refinery in 
1990, excluding gasoline blendstocks and exported gasoline, and 
including the oxygenate volume associated with any product meeting the 
requirements specified in paragraph (c)(1)(ii) of this section.
    (ii) Gasoline brought into the refinery in 1990 which exited the 
refinery, in 1990, unchanged shall not be included in determining the 
refinery's baseline volume.
    (iii) If a refiner is allowed to adjust its baseline per paragraphs 
(e)(5) through (e)(7) of this section, its individual baseline volume 
shall be the volume determined after the adjustment.
    (iv) The individual baseline volume for facilities deemed closely 
integrated, per paragraph (e)(1) of this section, shall be the combined 
1990 gasoline production of the facilities, so long as mutual volumes 
are not double-counted, i.e., volumes of blendstock sent from the 
refinery to the blending facility should not be included in the 
blending facility's volume.
    (v) The baseline volume of a refiner, per paragraph (b)(3) of this 
section, shall be the larger of the total gasoline volume produced in 
or shipped from the refinery in 1990, excluding gasoline blendstocks 
and exported gasoline.
    (vi) The baseline volume of an importer, per paragraph (b)(4) of 
this section, shall be the total gasoline volume imported into the U.S. 
in 1990.
    (2) Individual baseline emissions. (i) Individual annual average 
baseline emissions (per Sec. 80.90) shall be determined for every 
refinery, refiner or importer, as applicable.
    (ii) For each individual summer or winter baseline fuel parameter 
value (determined per paragraph (e) of this section) which is outside 
of the complex model conventional gasoline valid range for that 
parameter (per Sec. 80.45(f)(1)(ii)), the complex model range is 
extended only for such fuel parameters, in both baseline and compliance 
complex model emissions determinations, and only for the applicable 
summer or winter models.
    (iii) Facilities deemed closely integrated, per paragraph (e)(1) of 
this section, shall have a single set of annual average individual 
baseline emissions.
    (iv) Aggregate baselines (per Sec. 80.101(h)) must have the 
NOX emissions of all refineries in the aggregate determined on the 
same basis, using either oxygenated or non-oxygenated baseline fuel 
parameters.
    (3) Geographic considerations requiring individual conventional 
gasoline compliance baselines. (i) Anyone may petition EPA to establish 
separate baselines for refineries located in and providing conventional 
gasoline to an area with a limited gasoline distribution system if it 
can show that the area is experiencing increased toxics emissions due 
to an ozone nonattainment area opting into the reformulated gasoline 
program pursuant to section 211(k)(6) of the Act.
    (ii) If EPA agrees with the finding of paragraph (f)(4)(i) of this 
section, it shall require that the baselines of such refineries be 
separate from refineries not located in the area.
    (iii) If two (2) or more of a refiner's refineries are located in 
the geographic area of concern, the refiner may aggregate the baseline 
emissions and sulfur, olefin and T90 values of the refineries or have 
an individual baseline for one or more of the refineries, per paragraph 
(f)(3) of this section.
    (4) Baseline recalculations. Aggregate baseline exhaust emissions 
(per Sec. 80.90) and baseline sulfur, olefin and T90 values and 
aggregate baseline volumes shall be recalculated under the following 
circumstances:
    (i) A refinery included in an aggregate baseline is entirely 
shutdown. If the shutdown refinery was part of an aggregate baseline, 
the aggregate baseline emissions, aggregate baseline sulfur, olefin and 
T90 values and aggregate volume shall be recalculated to account for 
the removal of the shutdown refinery's contributions to the aggregate 
baseline.
    (ii) A refinery exchanges owners.
    (A) All aggregate baselines affected by the exchange shall be 
recalculated to reflect the addition or subtraction of the baseline 
exhaust emissions, sulfur, olefin and T90 values and volumes of that 
refinery.
    (B) The new owner may elect to establish an individual baseline for 
the refinery or to include it in an aggregate baseline.
    (C) If the refinery was part of an aggregate of three or more 
refineries, the remaining refineries in the aggregate from which that 
refinery was removed will have a new aggregate baseline. If the 
refinery was part of an aggregate of only two refineries, the remaining 
refinery will have an individual baseline.
    (g) Inability to meet the requirements of this section. If a 
refiner or importer is unable to comply with one or more of the 
requirements specified in paragraphs (a) through (f) of this section, 
it may, upon petition and approval, accommodate the lack of compliance 
in a reasonable, logical, technically sound manner, considering the 
appropriateness of the alternative. A narrative of the situation, as 
well as any calculations and results determined, must be documented.


Sec. 80.92  Baseline auditor requirements.

    (a) General requirements. (1) Each refiner or importer is required 
to have its individual baseline determination methodology, resulting 
baseline fuel parameter, volume and emissions values, and 1990-1993 
blendstock-to-gasoline ratios (per Sec. 80.102) verified by an auditor 
which meets the requirements described in this section. A refiner or 
importer which has the anti-dumping statutory baseline as its 
individual baseline is exempt from this requirement.
    (2) An auditor may be an individual or organization, and may 
utilize contractors and subcontractors to assist in the verification of 
a baseline.
    (3) If an auditor is an organization, one or more persons shall be 
designated as primary analyst(s). The primary analyst(s) shall meet the 
requirements described in paragraphs (c) (2) and (3) of this section 
and shall be responsible for the baseline audit per paragraph (f) of 
this section.
    (b) Independence. The auditor, its contractors, subcontractors and 
their organizations shall be independent of the submitting 
organization. All of the criteria listed in paragraphs (b) (1) and (2) 
of this section must be met by every individual involved in substantive 
aspects of the baseline verification.
    (1) Previous employment criteria. (i) None of the auditing 
personnel, including any contractor or subcontractor personnel, 
involved in the baseline verification for a refiner or importer shall 
have been employed by the refiner or importer at any time during the 
three (3) years preceding the date of hire of the auditor by the 
refiner or importer for baseline verification purposes.
    (ii) Auditor personnel may have been a contractor or subcontractor 
to the refiner or importer, as long as all other criteria listed in 
this section are met.
    (iii) Auditor personnel may also have developed the baseline of the 
refiner or importer whose baseline they are auditing, but not as an 
employee (per paragraph (b)(1)(i) of this section). Those involved only 
in the development of the baseline of the refiner or importer need not 
meet the requirements specified in this section.
    (2) Financial criteria. Neither the primary analyst, nor the 
auditing organization nor any organization or individual which may be 
contracted or subcontracted to supply baseline verification expertise 
shall:
    (i) Have received more than one quarter of its revenue from the 
refiner or importer during the year prior to the date of hire of the 
auditor by the refiner or importer for auditing purposes. Income 
received from the refiner or importer to develop the baseline being 
audited is excepted; nor
    (ii) Have a total of more than 10 percent of its net worth with the 
refiner or importer; nor
    (iii) Receive compensation for the audit which is dependent on the 
outcome of the audit.
    (c) Technical ability. All of the following criteria must be met by 
the auditor in order to demonstrate its technical capability to perform 
the baseline audit:
    (1) The auditor shall be technically capable of evaluating a 
baseline determination. It shall have personnel familiar with petroleum 
refining processes, including associated computational procedures, 
methods of product analysis and economics, and expertise in conducting 
the auditing process, including skills for effective data gathering and 
analysis.
    (2) The primary analyst must understand all technical details of 
the entire baseline audit process.
    (3)(i) The primary analyst shall have worked at least five (5) 
years in either refinery operations or as a consultant for the refining 
industry.
    (ii) If one or more computer models designed for refinery planning 
and/or economic analysis are used in the verification of an individual 
baseline, the primary analyst must have at least three (3) years 
experience working with the model(s) utilized in the verification.
    (iii) EPA may, upon petition, waive one or more of the requirements 
specified in paragraph (c)(3) of this section if the technical 
capability of the primary analyst is demonstrated to the satisfaction 
of the Director of the Office of Mobile Sources, or designee.
    (d) Auditor qualification statement. A statement documenting the 
qualifications of the auditor, primary analyst(s), contractors, 
subcontractors and their organizations must be submitted to EPA (Fuel 
Studies and Standards Branch, Baseline Auditor, U.S. EPA, 2565 Plymouth 
Rd., Ann Arbor, MI 48105).
    (1) Timing. (i) The auditor qualification statement may be 
submitted by the refiner or importer prior to baseline submission (per 
Sec. 80.93) or by a potential auditor at any time. The auditor will be 
deemed certified when all qualifications are met, to the satisfaction 
of the Director of the Office of Mobile Sources, or designee. If no 
response is received from EPA within 45 days of application or today's 
date, whichever is later, the auditor shall be deemed certified.
    (ii) The auditor qualification statement may be submitted by the 
refiner or importer with its baseline submission (per Sec. 80.93). If 
the auditor does not meet the criteria specified in this section, the 
baseline submission will not be accepted.
    (2) Content. The auditor qualification statement must contain all 
of the following information and may contain additional information 
which may aid EPA's review of the qualification statement:
    (i) The name and address of each person and organization involved 
in substantive aspects of the baseline audit, including the auditor, 
primary analyst(s), others within the organization, and contractors and 
subcontractors;
    (ii) The refiners and/or importers for which the auditor, its 
contractors and subcontractors and their organizations do not meet the 
independence criteria described in paragraph (b) of this section; and
    (iii) The technical qualifications and experience of each person 
involved in the baseline audit, including a showing that the 
requirements described in paragraph (c) of this section are met.
    (e) Refiner and importer responsibility. (1) Each refiner and 
importer required to have its baseline verified by an auditor (per 
paragraph (a)(1) of this section) is responsible for utilizing an 
auditor for baseline verification which meets the requirements 
specified in paragraphs (b) and (c) of this section.
    (2) A refiner's or importer's baseline submission will not be 
accepted until it has been verified using an auditor which meets the 
requirements specified in paragraphs (b) and (c) of this section.
    (f) Auditor responsibilities. (1) The auditor must verify that all 
baseline submission requirements are fulfilled. This includes, but is 
not limited to, the following:
    (i) Verifying that all data is correctly accounted for;
    (ii) Verifying that all calculations are performed correctly;
    (iii) Verifying that all adjustments to the data and/or 
calculations to account for post-1990 data, work-in-progress, and/or 
extenuating or other circumstances, as allowed per Sec. 80.91, are 
valid and performed correctly.
    (2) The primary analyst shall prepare and sign a statement, to be 
included in the baseline submission of the refiner or importer, stating 
that:
    (i) He/she has thoroughly reviewed the sampling methodology and 
baseline calculations; and
    (ii) To the best of his/her knowledge, the requirements and 
intentions of the rulemaking are met in the baseline determination; and
    (iii) He/she agrees with the final baseline parameter, volume and 
emission values listed in the baseline submission.
    (3) The auditor may be subject to debarment under U.S.C. 1001 if it 
displays gross incompetency, intentionally commits an error in the 
verification process or misrepresents itself or information in the 
baseline verification.


Sec. 80.93  Individual baseline submission and approval.

    (a) Submission timing. (1) Each refiner, blender or importer shall 
submit two copies of its individual baseline to EPA (Fuel Studies and 
Standards Branch, Baseline Submission, U.S. EPA, 2565 Plymouth Rd., Ann 
Arbor, MI 48105) not later than June 1, 1994.
    (2) If a refiner must collect data after December 15, 1993 (per 
Sec. 80.91(d)(2)), it shall submit two copies of its individual 
baseline to EPA (per Sec. 80.93(a)(1)) by September 1, 1994.
    (3)(i) All petitions required for baseline adjustments or 
methodology deviations will be approved or disapproved by the Director 
of the Office of Mobile Sources, or designee. All instances where a 
``showing'' or other proof is required are also subject to approval by 
the Director of the Office of Mobile Sources, or designee.
    (ii) Auditor-verified petitions, ``showings'' and other associated 
proof may be submitted to EPA (per Sec. 80.93(a)(1)) prior to the 
official submittal of the entire baseline determination. EPA will 
attempt to review and approve, disapprove or otherwise comment on the 
petition, etc., prior to the deadline for baseline submittal.
    (iii) In the event that EPA does not comment on the petition prior 
to the deadline for baseline submittal, the refiner or importer must 
still comply with the applicable baseline submittal deadline.
    (4) If a baseline recalculation is required per Sec. 80.91(f), 
documentation and recalculation of all affected baselines shall be 
submitted to EPA within 30 days of the previous baseline(s) becoming 
inaccurate due to the circumstances outlined in Sec. 80.91(f).
    (b) Submission content. (1) Individual baseline submissions shall 
include, at minimum, the information specified in this paragraph (b).
    (i) During its review and evaluation of the baseline submission, 
EPA may require a refiner or importer to submit additional information 
in support of the baseline determination.
    (ii) Additional information which may assist EPA during its review 
and evaluation of the baseline may be included at the submitter's 
discretion.
    (2) Administrative information shall include:
    (i) Name and business address of the refiner or importer;
    (ii) Name, business address and business phone number of the 
company contact;
    (iii) Address and physical location of each refinery, terminal or 
import facility;
    (iv) Address and physical location where documents which are 
supportive of the baseline determination for each facility are kept;
    (3) The chief executive officer statement shall be:
    (i) A statement signed by the chief executive officer of the 
company, or designee, which states that:
    (A) The company is complying with the requirements as a refiner, 
blender or importer, as appropriate;
    (B) The data used in the baseline determination is the extent of 
the data available for the determination of all required baseline fuel 
parameters;
    (C) All calculations and procedures followed per Secs. 80.90 
through 80.93 have been done correctly;
    (D) Proper adjustments have been made to the data or in the 
calculations, as applicable;
    (E) The requirements and intentions of the rulemaking have been met 
in determining the baseline fuel parameters; and
    (F) The baseline fuel parameter values determined for each facility 
represent that facility's 1990 gasoline to the fullest extent possible.
    (ii) A refiner or importer which is permitted to utilize the 
parameter values specified in Sec. 80.91(c)(5), and does so, shall 
submit a statement signed by the chief executive officer of the 
company, or designee, indicating that insufficient data exist for a 
baseline determination by the types of data allowed for that entity, as 
specified in Sec. 80.91.
    (4) The auditor-related requirements are:
    (i) Name, address, telephone number and date of hire of each 
auditor hired for baseline verification, whether or not the auditor was 
retained through the baseline approval process.
    (ii) Identification of the auditor responsible for the 
verification. A copy of this auditor's qualification statement, per 
Sec. 80.92, must be included if the auditor has not been approved by 
EPA, per Sec. 80.92;
    (iii) Indication of the primary analyst(s) involved in each 
refinery's baseline verification; and
    (iv) The signed auditor verification statement, per Sec. 80.92.
    (5) The following baseline information for each refinery, refiner 
or importer, as applicable, shall be provided:
    (i) Individual baseline fuel parameter values, on an oxygenated and 
non-oxygenated basis, and on a summer and winter basis, per Sec. 80.91;
    (ii) Individual baseline exhaust emissions shall be shown 
separately, on a summer, winter and annual average basis (per 
Sec. 80.90) as follows:
    (A) Simple model exhaust benzene emissions;
    (B) Complex model exhaust benzene emissions;
    (C) Complex model exhaust toxics emissions, for Phase I;
    (D) Complex model exhaust NOX emissions, for Phase I, using 
oxygenated individual baseline fuel parameters;
    (E) Complex model exhaust NOX emissions, for Phase I, using 
non-oxygenated individual baseline fuel parameters;
    (F) Complex model exhaust toxics emissions, for Phase II;
    (G) Complex model exhaust NOX emissions, for Phase II, using 
oxygenated individual baseline fuel parameters; and
    (H) Complex model exhaust NOX emissions, for Phase II, using 
non-oxygenated individual baseline fuel parameters;
    (iii) Individual 1990 baseline gasoline volumes, per Sec. 80.91, 
shall be shown separately on a summer, winter and annual average basis; 
and
    (iv) Blendstock-to-gasoline ratios for each calendar year 1990 
through to 1993, per Sec. 80.102.
    (6) Confidentiality claim.
    (i) Upon approval of an individual baseline, EPA will publish the 
individual standards for each refinery, blender or importer in the 
Federal Register. Such information shall include baseline emissions as 
specified in Sec. 80.90 and 125% of the individual baseline values for 
sulfur, olefins and T90.
    (ii) Information in the baseline submission which the submitter 
desires be considered confidential business information (per 40 CFR 
part 2, subpart B) must be clearly identified. Information specified in 
paragraph (b)(5) of this section shall not be considered confidential.
    (7) Information related to baseline determination as specified in 
Sec. 80.91 and paragraph (c) of this section.
    (c) Additional baseline submission requirements when Method 1-, 2- 
and/or 3-type data is utilized. All requirements of this paragraph 
shall be reported separately for each facility, unless the facilities 
are closely integrated, per Sec. 80.91.
    (1) General. The following information shall be provided:
    (i) The number of months in 1990 during which the facility was 
operating;
    (ii) 1990 summer gasoline production volume, per Sec. 80.91, total 
and by grade, for all gasoline produced but not exported;
    (iii) 1990 winter gasoline production volume, per Sec. 80.91, total 
and by grade, for all gasoline produced, excluding gasoline exported; 
and
    (iv) Whether this facility is actually two facilities which are 
closely integrated, per Sec. 80.91.
    (2) Baseline values. The following shall be included for each fuel 
parameter for which a baseline value is required, per Sec. 80.91:
    (i) Narrative of the development of the baseline value of the fuel 
parameter, including discussion of the sampling and calculation 
methodologies, technical judgment used, effects of petition results on 
calculated values, and any additional information which may assist EPA 
in its review of the baseline;
    (ii) Identification of the data-type(s), per Sec. 80.91, used in 
the determination of a given fuel parameter;
    (iii) Identification of test method. If not per Sec. 80.46, include 
a narrative, explain differences and describing adequacy, per 
Sec. 80.91;
    (iv) Documentation that the minimum sampling requirements per 
Sec. 80.91 have been met;
    (v) Petition and narrative, if needed, for use of less than the 
minimum required data, per Sec. 80.91;
    (vi) Identification of instances of sample compositing per 
Sec. 80.91;
    (vii) Identification of streams for which one or more parameter 
values were deemed negligible per Sec. 80.91; and
    (viii) Discussion of the calculation of oxygenated or non-
oxygenated fuel parameter values from non-oxygenated or oxygenated 
values, respectively, per Sec. 80.91.
    (3) Method 1. If Method 1-type data is utilized in the baseline 
determination, the following information on 1990 batches of gasoline, 
or shipments if not batch blended, are required by grade shall be 
provided:
    (i) First and last sampling dates;
    (ii) The following shall be indicated separately on a summer and 
winter basis, by month:
    (A) Number of months sampled;
    (B) Number of 1990 batches, or shipments if not batch blended;
    (C) Total volume of all batches or shipments;
    (D) Number of batches or shipments sampled;
    (E) Total volume of all batches or shipments sampled;
    (F) Baseline fuel parameter value, per Sec. 80.91; and
    (iii) A showing that data was available on every batch of 1990 
gasoline, if applicable, per Sec. 80.91 (b)(3) or (b)(4).
    (4) Method 2. If Method 2-type data is utilized in the baseline 
determination, the following information on each type of 1990 
blendstock used in the refinery's gasoline are required, by blendstock 
type shall be provided:
    (i) First and last sampling dates; and
    (ii) The following shall be indicated separately on a summer and 
winter basis, by month:
    (A) Number of months sampled;
    (B) Each type of blendstock used in 1990 gasoline and total number 
of blendstocks. Include all blendstocks produced, purchased or 
otherwise received which were blended to produce gasoline within the 
facility. Identify all blendstocks not produced in the facility but 
used in the facility's 1990 gasoline;
    (C) Total volume of each blendstock used in gasoline in 1990;
    (D) Identification of blendstock streams as batch or continuous;
    (E) Number of blendstock samples from continuous blendstock 
streams;
    (F) Number of blendstock samples from batch processes, including 
volume of each batch sampled; and
    (G) Baseline fuel parameter value, per Sec. 80.91.
    (5) Method 3, blendstock data. The following information on each 
type of post-1990 gasoline blendstock used in the refinery's gasoline 
are required, by blendstock type shall be provided:
    (i) First and last sampling dates;
    (ii) The following shall be indicated separately on a summer and 
winter basis, by month:
    (A) Number of post-1990 months sampled;
    (B) Each type of blendstock used in 1990 gasoline and total number 
of blendstocks. Include all blendstocks produced, purchased or 
otherwise received which were blended to produce gasoline within the 
facility. Identify all blendstocks not produced in the facility but 
used in the facility's 1990 gasoline;
    (C) Total volume of each blendstock used in gasoline in 1990;
    (D) Identification of post-1990 blendstock streams as batch or 
continuous;
    (E) Number of post-1990 blendstock samples from continuous 
blendstock streams;
    (F) Number of post-1990 blendstock samples from batch processes, 
including volume of each batch sampled; and
    (G) Baseline fuel parameter value, per Sec. 80.91; and
    (iii) Support documentation showing that the criteria of Sec. 80.91 
for using Method 3-type blendstock data are met.
    (6) Method 3, post-1990 gasoline data. The following information on 
post-1990 batches of gasoline, or shipments if not batch blended, are 
required by grade:
    (i) First and last sampling dates;
    (ii) The following shall be indicated separately for summer and 
winter production, by month:
    (A) Number of post-1990 months sampled;
    (B) Number of post-1990 batches, or shipments if not batch blended;
    (C) Total volume of all post-1990 batches or shipments;
    (D) Number of post-1990 batches or shipments sampled;
    (E) Volume of each post-1990 batch or shipment sampled; and
    (F) Baseline fuel parameter value, per Sec. 80.91; and
    (iii) Support documentation showing that the criteria of Sec. 80.91 
for using post-1990 gasoline data are met.
    (7) Work-in-progress (WIP). All of the following must be included 
in support of a WIP adjustment (per Sec. 80.91(e)(5)):
    (i) Petition including identification of the specific baseline 
emission(s) or parameter for which the WIP adjustment is desired;
    (ii) Showing that all WIP criteria, per Sec. 80.91(e)(5), are met;
    (iii) Unadjusted and adjusted baseline fuel parameters, emissions 
and volume for the facility; and
    (iv) Narrative, per Sec. 80.91 (e)(5).
    (8) Extenuating circumstances. All of the following must be 
included in support of an extenuating circumstance adjustment (per 
Sec. 80.91 (e)(6) through (e)(7)):
    (i) Petition including identification of the allowable 
circumstance, per Sec. 80.91 (e)(6) through (e)(7);
    (ii) Showing that all applicable criteria, per Sec. 80.91 (e)(6) 
through (e)(7), are met;
    (iii) Unadjusted and adjusted baseline fuel parameters, emissions 
and volume for the facility; and
    (iv) Narrative, per Sec. 80.91.
    (9) Other baseline information. Narrative discussing any aspects of 
the baseline determination not already indicated per the requirements 
of this paragraph (c) shall be provided.
    (10) Refinery information. The following information, on a summer 
or winter basis, shall be provided:
    (i) Refinery block flow diagram, showing principal refining units;
    (ii) Principal refining unit charge rates and capacities;
    (iii) Crude types utilized (names, gravities, and sulfur content) 
and crude charge rates; and
    (iv) Information on the following units, if utilized in the 
refinery:
    (A) Catalytic Cracking Unit: conversion, unit yields, gasoline fuel 
parameter values (per Sec. 80.91(a)(2));
    (B) Hydrocracking Unit: unit yields, gasoline fuel parameter values 
(per Sec. 80.91(a)(2));
    (C) Catalytic Reformer: unit yields, severities;
    (D) Bottoms Processing Units (including, but not limited to, 
coking, extraction and hydrogen processing): gasoline stream yields;
    (E) Yield structures for other principal units in the refinery 
(including but not limited to Alkylation, Polymerization, 
Isomerization, Etherification, Steam Cracking).


Secs. 80.94-80.100  [Reserved]


Sec. 80.101  Standards applicable to refiners and importers.

    Any refiner or importer of conventional gasoline shall meet the 
standards specified in this section over the specified averaging 
period, beginning on January 1, 1995.
    (a) Averaging period. The averaging period for the standards 
specified in this section shall be January 1 through December 31.
    (b) Conventional gasoline compliance standards--(1) Simple model 
standards. The simple model standards are the following:
    (i) Annual average exhaust benzene emissions, calculated according 
to paragraph (g)(1)(i) of this section, shall not exceed the refiner's 
or importer's compliance baseline for exhaust benzene emissions;
    (ii) Annual average levels of sulfur shall not exceed 125% of the 
refiner's or importer's compliance baseline for sulfur;
    (iii) Annual average levels of olefins shall not exceed 125% of the 
refiner's or importer's compliance baseline for olefins; and
    (iv) Annual average values of T-90 shall not exceed 125% of the 
refiner's or importer's compliance baseline for T-90.
    (2) Optional complex model standards. Annual average levels of 
exhaust benzene emissions, weighted by volume for each batch and 
calculated using the applicable complex model under Sec. 80.45, shall 
not exceed the refiner's or importer's 1990 average exhaust benzene 
emissions.
    (3) Complex model standards. Annual average levels of exhaust 
toxics emissions and NOX emissions, weighted by volume for each 
batch and calculated using the applicable complex model under 
Sec. 80.45, shall not exceed the refiner's or importer's 1990 average 
exhaust toxics emissions and NOX emissions, respectively.
    (c) Applicability of standards. (1) For each averaging period prior 
to January 1, 1998, a refiner or importer shall be subject to either 
the Simple Model or Optional Complex Model Standards, at their option, 
except that any refiner or importer shall be subject to:
    (i) The Simple Model Standards if the refiner or importer uses the 
Simple Model Standards for reformulated gasoline; or
    (ii) The Optional Complex Model Standards if the refiner or 
importer used the Complex Model Standards for reformulated gasoline.
    (2) Beginning January 1, 1998, each refiner and importer shall be 
subject to the Complex Model Standards for each averaging period.
    (d) Product to which standards apply. Any refiner for each 
refinery, or any importer, shall include in its compliance 
calculations:
    (1) Any conventional gasoline produced or imported during the 
averaging period;
    (2) Any non-gasoline petroleum products that are produced or 
imported and sold or transferred from the refinery or group of 
refineries or importer during the averaging period, if required 
pursuant to Sec. 80.102(e)(2), unless the refiner or importer is able 
to establish in the form of documentation that the petroleum products 
were used for a purpose other than the production of gasoline within 
the United States;
    (3) Any gasoline blending stock produced or imported during the 
averaging period which becomes conventional gasoline solely upon the 
addition of oxygenate;
    (4)(i) Any oxygenate that is added to conventional gasoline, or 
gasoline blending stock as described in paragraph (d)(3) of this 
section, where such gasoline or gasoline blending stock is produced or 
imported during the averaging period;
    (ii) In the case of oxygenate that is added at a point downstream 
of the refinery or import facility, the oxygenate may be included only 
if the refiner or importer can establish the oxygenate was in fact 
added to the gasoline or gasoline blendstock produced, by showing that 
the oxygenate was added by:
    (A) The refiner or importer; or
    (B) By a person other than the refiner or importer, provided that 
the refiner or importer:
    (1) Has a contract with the oxygenate blender that specifies 
procedures to be followed by the oxygenate blender that are reasonably 
calculated to ensure blending with the amount and type of oxygenate 
claimed by the refiner or importer; and
    (2) Monitors the oxygenate blending operation to ensure the volume 
and type of oxygenate claimed by the refiner or importer is correct, 
through periodic audits of the oxygenate blender designed to assess 
whether the overall volumes and type of oxygenate purchased and used by 
the oxygenate blender are consistent with the oxygenate claimed by the 
refiner or importer and that this oxygenate was blended with the 
refiner's or importer's gasoline or blending stock, periodic sampling 
and testing of the gasoline produced subsequent to oxygenate blending, 
and periodic inspections to ensure the contractual requirements imposed 
by the refiner or importer on the oxygenate blender are being met.
    (e) Product to which standards do not apply. Any refiner for each 
refinery, or any importer, shall exclude from its compliance 
calculations:
    (1) Gasoline that was not produced at the refinery or was not 
imported by the importer;
    (2) Blendstocks that have been included in another refiner's 
compliance calculations, pursuant to Sec. 80.102(e)(2) or otherwise;
    (3) Gasoline that meets the enforcement exemption for California 
gasoline under Sec. 80.81; and
    (4) Gasoline that is exported.
    (f) Compliance baseline determinations. (1) In the case of any 
refiner or importer for whom an individual baseline has been 
established under Sec. 80.91, the individual baseline for each 
parameter or emissions performance shall be the compliance baseline for 
that refiner or importer.
    (2) In the case of any refiner or importer for whom the anti-
dumping statutory baseline applies under Sec. 80.91, the anti-dumping 
statutory baseline for each parameter or emissions performance shall be 
the compliance baseline for that refiner or importer.
    (3) In the case of a party that is both a refiner and an importer, 
and for whom an individual 1990 baseline has not been established for 
the imported product under Sec. 80.91(b)(4), the compliance baseline 
for the imported product shall be the 1990 volume weighted average of 
all of the refiner's individual refinery baselines.
    (4) Any compliance baseline under paragraph (f) (1) or (3) of this 
section shall be adjusted for each averaging period as follows:
    (i) The 1990 equivalent conventional gasoline volume for an 
averaging period is calculated according to the following formula:

TR16FE94.021

where

Veq=the 1990 equivalent conventional gasoline volume
V1990=the 1990 volume of gasoline as determined under 
Sec. 80.91(f)(1)
Vr=the total volume of reformulated gasoline produced or imported 
by a refiner or importer during the averaging period excluding gasoline 
which meets the enforcement exemptions of Sec. 80.81
Vc=the total volume of conventional gasoline produced or imported 
by a refiner or importer during the averaging period excluding gasoline 
which meets the enforcement exemptions of Sec. 80.81

    (ii)(A) If the total volume of the conventional gasoline produced 
or imported by the refiner or importer during the averaging period is 
equal to or less than that refiner's or importer's 1990 equivalent 
conventional gasoline volume, the compliance baseline for each 
parameter shall be that refiner's or importer's individual 1990 
baseline; or
    (B) If the total volume of the conventional gasoline produced or 
imported by the refiner or importer is greater than that refiner's or 
importer's 1990 equivalent conventional gasoline volume, the compliance 
baseline for each parameter or emissions performance shall be 
calculated according to the following formula:

TR16FE94.022

where

CBi=the compliance baseline value for parameter or emissions 
product i
Bi=the refiner's or importer's individual baseline value for 
parameter i calculated according to the methodology in Sec. 80.91
Veq=the 1990 equivalent conventional gasoline volume for the 
averaging period, calculated pursuant to paragraph (f)(4)(iii) of this 
section
DBi=the anti-dumping statutory baseline value for parameter i, as 
specified at Sec. 80.91(c)(5)
Vc=the total volume of conventional gasoline and other products 
included under paragraph (d) of this section produced or imported by a 
refiner or importer during the averaging period

    (g) Compliance calculations. (1) In the case of any refiner or 
importer subject to an individual refinery baseline, the annual average 
value for each parameter or emissions performance during the averaging 
period, calculated according to the following methodologies, shall be 
less than or equal to the refiner's or importer's standard under 
paragraph (b) of this section for that parameter.
    (i) Exhaust benzene emissions under the Simple Model for an 
averaging period are calculated as follows:

EXHBEN=1.884+(0.949 x BZ)+(0.113 x (AR-BZ))

 where

EXHBEN=the average exhaust benzene emissions for the averaging period
BZ=the average benzene content for the averaging period
AR=the average aromatics content for the averaging period

    (ii) The average value for each parameter for an averaging period 
shall be calculated as follows:

TR16FE94.023

where

APARM=the average value for the parameter being evaluated
Vi=the volume of conventional gasoline and other products included 
under paragraph (d) of this section, in batch i
PARMi=the value of the parameter being evaluated for batch i as 
determined in accordance with the test methods specified in Sec. 80.46
n=the number of batches of conventional gasoline and other products 
included under paragraph (d) of this section produced or imported 
during the averaging period
SGi=specific gravity of batch i (only applicable for properties 
determined on a weight percent or ppm basis)

    (iii) Exhaust benzene emissions performance for each batch shall be 
calculated in accordance with the applicable model under Sec. 80.45.
    (iv) Exhaust toxics emissions performance for each batch shall be 
calculated in accordance with the applicable model under Sec. 80.45.
    (v) Exhaust NOX emissions performance for each batch shall be 
calculated in accordance with the applicable model under Sec. 80.45.
    (2) In the case of any refiner or importer subject to the anti-
dumping statutory baseline, the refiner or importer shall determine 
compliance using the following methodology:
    (i) Calculate the compliance total for the averaging period for 
sulfur, T-90, olefins, exhaust benzene emissions, exhaust toxics and 
exhaust NOX emissions, as applicable, based upon the anti-dumping 
statutory baseline value for that parameter using the formula specified 
at Sec. 80.67.
    (ii) Calculate the actual total for the averaging period for 
sulfur, T-90, olefins, exhaust benzene emissions, exhaust toxics and 
exhaust NOX emissions, as applicable, based upon the value of the 
parameter for each batch of conventional gasoline and gasoline 
blendstocks, if applicable, using the formula specified at Sec. 80.67.
    (iii) The actual total for exhaust benzene emissions, exhaust 
toxics and exhaust NOX emissions, shall not exceed the compliance 
total, and the actual totals for sulfur, olefins and T-90 shall not 
exceed 125% of the compliance totals, as required under the applicable 
model.
    (3) In the case of any batch of gasoline that is produced by 
combining blendstock with gasoline, where the gasoline portion of the 
blend is not included in the compliance calculation, the emissions 
performance for exhaust benzene, exhaust toxics, and exhaust NOX 
emissions for the blendstock shall be:
    (i)(A) The emissions performance of a gasoline that would be 
produced by combining the blendstock used at the volume percentage 
used, with a gasoline that has properties that are equal to the 
refiner's or importer's anti-dumping baseline; minus
    (B) The emissions performance of a gasoline that has properties 
that are equal to the refiner's or importer's anti-dumping baseline.
    (ii) The volume weighted net emissions performance for exhaust 
benzene, exhaust toxics, and exhaust NOX emissions, as applicable, 
for all batches of gasoline that are produced during the averaging 
period by combining blendstock with gasoline, shall be equal to or less 
than zero.
    (iii) The value of those properties measured on a weight percent or 
ppm basis shall be adjusted for the specific gravity of the gasoline 
and blendstocks used for the purposes of calculations under paragraph 
(g)(3) of this section.
    (iv) For blends which contain greater than 1.50 volume percent 
ethanol, the RVP of the final blend shall be 1.0 psi greater than the 
RVP of the base gasoline and blendstocks without the ethanol for the 
purposes of calculations under paragraph (g)(3) of this section.
    (v) For blends containing less than 1.50 volume percent ethanol, 
the RVP of the base gasoline and blendstocks without ethanol shall be 
used for the purposes of calculations under paragraph (g)(3) of this 
section.
    (4) Compliance calculations under this subpart E shall be based on 
computations to the same degree of accuracy that are specified in 
establishing individual baselines under Sec. 80.91.
    (5) The emissions performance of gasoline that has an RVP that is 
equal to or less than the RVP required under Sec. 80.27 (``summer 
gasoline'') shall be determined using the applicable summer complex 
model under Sec. 80.45.
    (6) The emissions performance of gasoline that has an RVP greater 
than the RVP required under Sec. 80.27 (``winter gasoline'') shall be 
determined using the applicable winter complex model under Sec. 80.45, 
using an RVP of 8.7 psi for compliance calculation purposes under this 
subpart E.
    (7)(i) For the 1998 averaging period any refiner or importer may 
elect to determine compliance with the requirement for exhaust NOX 
emissions performance either with or without the inclusion of 
oxygenates in its compliance calculations, in accordance with 
Sec. 80.91(e)(4), provided that the baseline exhaust NOX emissions 
performance is calculated using the same with- or without-oxygen 
approach.
    (ii)(A) Any refiner or importer must use the with- or without-
oxygen approach elected under paragraph (g)(7)(i) of this section for 
all subsequent averaging periods; except that
    (B) In the case of any refiner or importer who elects to determines 
compliance for the calendar year 1998 averaging period without the 
inclusion of oxygenates, such refiner or importer may elect to include 
oxygenates in its compliance calculations for the 1999 averaging 
period.
    (iii) Any refiner or importer who elects to use the with-oxygen 
approach under paragraph (g)(7)(ii)(B) of this section must use this 
approach for all subsequent averaging periods.
    (h) Refinery grouping for determining compliance. (1) Any refiner 
that operates more than one refinery may:
    (i) Elect to achieve compliance individually for the refineries; or
    (ii) Elect to achieve compliance on an aggregate basis for a group, 
or for groups, of refineries, some of which may be individual 
refineries; provided that
    (iii) Compliance is achieved for each refinery separately or as 
part of a group; and
    (iv) The data for any refinery is included only in one compliance 
calculation.
    (2) Any election by a refiner to group refineries under paragraph 
(h)(1) of this section shall:
    (i) Be made as part of the report for the 1995 averaging period 
required by Sec. 80.105;
    (ii) Apply for the 1995 averaging period and for each subsequent 
averaging period, and may not thereafter be changed; and
    (iii) Apply for purposes of the blendstock tracking and accounting 
provisions under Sec. 80.102.
    (3)(i) Any standards under this section shall apply, and compliance 
calculations shall be made, separately for each refinery or refinery 
group; except that
    (ii) Any refiner that produces conventional gasoline for 
distribution to a specified geographic area which is the subject of a 
petition approved by EPA pursuant to Sec. 80.91(f)(3) shall achieve 
compliance separately for gasoline supplied to such specified 
geographic area.
    (i) Sampling and testing. (1) Any refiner or importer shall for 
each batch of conventional gasoline, and other products if included 
paragraph (d) of this section, prior to such gasoline or product 
leaving the refinery or import facility:
    (i)(A) Determine the value of each of the properties required for 
determining compliance with the standards that are applicable to the 
refiner or importer, by collecting and analyzing a representative 
sample of gasoline or blendstock taken from the batch, using the 
methodologies specified in Sec. 80.46; except that
    (B) Any refiner that produces gasoline by combining blendstock with 
gasoline that has been included in the compliance calculations of 
another refiner or of an importer may for such gasoline meet this 
sampling and testing requirement by collecting and analyzing a 
representative sample of the blendstock used subsequent to each receipt 
of such blendstock if the compliance calculation method specified in 
paragraph (g)(3) of this section is used.
    (ii) Assign a number to the batch (the ``batch number''), as 
specified in Sec. 80.65(d)(3);
    (2) For the purposes of meeting the sampling and testing 
requirements under paragraph (i)(1) of this section, any refiner or 
importer may, prior to analysis, combine samples of gasoline collected 
from more than one batch of gasoline or blendstock (``composite 
sample''), and treat such composite sample as one batch of gasoline or 
blendstock provided that the refiner or importer:
    (i) Meets each of the requirements specified in 
Sec. 80.91(d)(4)(iii) for the samples contained in the composite 
sample;
    (ii) Combines samples of gasoline that are produced or imported 
over a period no longer than one month;
    (iii) Uses the total of the volumes of the batches of gasoline that 
comprise the composite sample, and the results of the analyses of the 
composite sample, for purposes of compliance calculations under 
paragraph (g) of this section; and
    (iv) Does not combine summer and winter gasoline, as specified 
under paragraphs (g) (5) and (6) of this section, in a composite 
sample.


Sec. 80.102  Controls applicable to blendstocks.

    (a) For the purposes of this subpart E:
    (1) All of the following petroleum products that are produced by a 
refiner or imported by an importer shall be considered ``applicable 
blendstocks'':
    (i) Reformate;
    (ii) Light coker naphtha;
    (iii) FCC naphtha;
    (iv) Benzene/toluene/xylene;
    (v) Pyrolysis gas;
    (vi) Aromatics;
    (vii) Polygasoline; and
    (viii) Dimate; and
    (2) Any gasoline blendstock with properties such that, if oxygenate 
only is added to the blendstock the resulting blend meets the 
definition of gasoline under Sec. 80.2(c), shall be considered 
gasoline.
    (b)(1) Any refiner or importer of conventional gasoline or 
blendstocks shall determine the baseline blendstock-to-gasoline ratio 
for each calendar year 1990 through 1993 according to the following 
formula:

TR16FE94.024

Where:

BGby=Blendstock-to-gasoline ratio for base year
Vbs=Volume of applicable blendstock produced or imported and 
transferred to others during the calendar year, and used in to produce 
gasoline
Vg=Volume of gasoline produced or imported during the calendar 
year

    (2)(i) Only those volumes of applicable blendstocks for which the 
refiner is able to demonstrate the blendstock was used in the 
production of gasoline may be included in baseline blendstock-to-
gasoline ratios under paragraph (b)(1) of this section.
    (ii) The baseline volume data for applicable blendstocks and 
gasoline shall be confirmed through the baseline audit requirements 
specified in Sec. 80.92 and submitted in accordance with the 
requirements of Sec. 80.93.
    (c) Any refiner or importer shall calculate the baseline cumulative 
blendstock-to-gasoline ratio according to the following formula:

TR16FE94.025

Where:

BGCbase=Baseline cumulative blendstock-to-gasoline ratio
Vbs, i=Volume of applicable blendstock produced or imported and 
transferred to others during calendar year i
Vg, i=Volume of gasoline produced or imported during calendar year 
i
i=each year, 1990 through 1993, for which a blendstock-to-gasoline 
ratio is calculated under paragraph (b) of this section

    (d)(1) For each averaging period, any refiner or importer shall:
    (i) Determine the averaging period blendstock-to-gasoline ratio 
according to the following formula:

TR16FE94.026

Where:

BGa=Blendstock-to-gasoline ratio for the current averaging period
Vbs=Volume of applicable blendstock produced or imported during 
the averaging period and subsequently transferred to others
Vg=Volume of conventional gasoline, reformulated gasoline, and 
RBOB produced or imported during the averaging period

    (ii) For each averaging period until January 1, 1998, calculate the 
peak year blendstock-to-gasoline ratio percentage change according to 
the following formula:

TR16FE94.027

Where:

PCp=Peak year blendstock-to-gasoline ratio percentage change
BGa=Blendstock-to-gasoline ratio for the averaging period 
calculated under paragraph (d)(1)(i) of this section
BGp=Largest one year blendstock-to-gasoline ratio calculated under 
paragraph (b) of this section

    (2) Beginning on January 1, 1998, for each averaging period any 
refiner or importer shall:
    (i) Determine the running cumulative compliance period blendstock-
to-gasoline ratio according to the following formula:

TR16FE94.028

Where:

 BGCcomp=Running cumulative compliance period blendstock-to-
gasoline ratio
Vbs, i=Volume of applicable blendstock produced or imported and 
transferred to others during averaging period i
Vg, i=Volume of conventional gasoline, reformulated gasoline, and 
RBOB produced or imported during averaging period i
i=The current averaging period, and each of the three immediately 
preceding averaging periods

    (ii) Calculate the cumulative blendstock-to-gasoline ratio 
percentage change according to the following formula:

TR16FE94.029

Where:

PCc=Cumulative blendstock-to-gasoline ratio percentage change
BGCcomp=Running cumulative compliance period blendstock-to-
gasoline ratio as determined in paragraph (d)(2)(i) of this section
BGCbase=Baseline cumulative blendstock-to-gasoline ratio 
calculated under paragraph (c) of this section

    (3) For purposes of this paragraph (d), all applicable blendstocks 
produced or imported shall be included, except those for which the 
refiner or importer has sufficient evidence in the form of 
documentation that the blendstocks were:
    (i) Exported;
    (ii) Used for other than gasoline blending purposes;
    (iii) Transferred to a refiner that used the blendstock as a 
``feedstock'' in a refining process during which the blendstock 
underwent a substantial chemical or physical transformation; or
    (iv) Transferred between refineries which have been grouped 
pursuant to Sec. 80.101(h) by a refiner for the purpose of determining 
compliance under this subpart.
    (e)(1) Any refiner or importer shall have exceeded the blendstock-
to-gasoline ratio percentage change threshold if:
    (i) The peak year blendstock-to-gasoline ratio percentage change 
calculated under paragraph (d)(1)(ii) of this section is more than ten; 
or
    (ii) Beginning on January 1, 1998, the cumulative blendstock-to-
gasoline ratio percentage change calculated under paragraph (d)(2)(ii) 
of this section is more than ten.
    (2) Any refiner or importer that exceeds the blendstock-to-gasoline 
ratio percentage change threshold shall, without further notification:
    (i) Include all blendstocks produced or imported and transferred to 
others in its compliance calculations for two averaging periods 
beginning on January 1 of the averaging period subsequent to the 
averaging period when the exceedance occurs;
    (ii) Provide transfer documents to the recipient of such blendstock 
that contain the language specified at Sec. 80. 106(b); and
    (iii) Transfer such blendstock in a manner such that the ultimate 
blender of such blendstocks has a reasonable basis to know that such 
blendstock has been accounted for.
    (3) Any refiner or importer that has previously exceeded the 
blendstock-to-gasoline ratio percentage change threshold, and 
subsequently exceeds the threshold for an averaging period and is not 
granted a waiver pursuant to paragraph (f)(2)(i) of this section, 
shall, without further notification, meet the requirements specified in 
paragraphs (e)(2) (i) through (iii) of this section for four averaging 
periods, beginning on January 1 of the averaging period following the 
averaging period when the subsequent exceedance occurs.
    (f)(1) The refiner or importer blendstock accounting requirements 
specified under paragraph (e) of this section shall not apply in the 
case of any refiner or importer:
    (i) Whose 1990 baseline value for each regulated fuel property and 
emission performance, as determined in accordance with Secs. 80.91 and 
80.92, is less stringent than the anti-dumping statutory baseline value 
for that parameter or emissions performance;
    (ii) Whose averaging period blendstock-to-gasoline ratio, 
calculated according to paragraph (d)(1)(i) of this section, is equal 
to or less than .0300; or
    (iii) Who obtains a waiver from EPA, provided that a petition for 
such a waiver is filed no later than fifteen days following the end of 
the averaging period for which the blendstock-to-gasoline ratio 
percentage change threshold is exceeded.
    (2)(i) EPA may grant the waiver referred to in paragraph 
(f)(1)(iii) of his section if the level of blendstock production was 
the result of extreme or unusual circumstances (e.g., a natural 
disaster or act of God) which clearly are outside the control of the 
refiner or importer, and which could not have been avoided by the 
exercise of prudence, diligence, and due care.
    (ii) Any petition filed under paragraph (f) of this section shall 
include information which describes the extreme or unusual circumstance 
which caused the increased volume of blendstock produced or imported, 
the steps taken to avoid the circumstance, and the steps taken to 
remedy or mitigate the effect of the circumstance.
    (g) Notwithstanding the requirements of paragraphs (a) through (f) 
of this section, any refiner or importer that transfers applicable 
blendstock to another refiner or importer with a less stringent 
baseline requirement, either directly or indirectly, for the purpose of 
evading a more stringent baseline requirement, shall include such 
blendstock(s) in determining compliance with the applicable 
requirements of this subpart.


Sec. 80.103  Registration of refiners and importers.

    Any refiner or importer of conventional gasoline must register with 
the Administrator in accordance with the provisions specified at 
Sec. 80.76.


Sec. 80.104  Record keeping requirements.

    Any refiner or importer shall maintain records containing the 
information as required by this section.
    (a) Beginning in 1995, for each averaging period:
    (1) Documents containing the information specified in paragraph 
(a)(2) of this section shall be obtained for:
    (i) Each batch of conventional gasoline, and blendstock if 
blendstock accounting is required under Sec. 80.102(e)(2); or
    (ii) Each batch of blendstock received in the case of any refiner 
that determines compliance on the basis of blendstocks properties under 
Sec. 80.101(g)(3).
    (2)(i) The results of tests performed in accordance with 
Sec. 80.101(i);
    (ii) The volume of the batch;
    (iii) The batch number;
    (iv) The date of production, importation or receipt;
    (v) The designation regarding whether the batch is summer or winter 
gasoline;
    (vi) The product transfer documents for any conventional gasoline 
produced or imported;
    (vii) The product transfer documents for any conventional gasoline 
received;
    (viii) For any gasoline blendstocks received by or transferred from 
a refiner or importer, documents that reflect:
    (A) The identification of the product;
    (B) The date the product was transferred; and
    (C) The volume of product;
    (ix) In the case of any refinery-produced or imported products 
listed in Sec. 80.102(a) that were transferred for other than gasoline 
blending purposes, documents which demonstrate that other purpose; and
    (x) In the case of oxygenate that is added by a person other than 
the refiner or importer under Sec. 80.101(d)(4)(ii)(B), documents that 
support the volume of oxygenate claimed by the refiner or importer, 
including the contract with the oxygenate blender and records relating 
to the audits, sampling and testing, and inspections of the oxygenate 
blender operation.
    (b) Any refiner or importer shall retain the documents required in 
this section for a period of five years from the date the conventional 
gasoline or blendstock is produced or imported, and deliver such 
documents to the Administrator of EPA upon the Administrator's request.


Sec. 80.105  Reporting requirements.

    (a) Beginning with the 1995 averaging period, and for each 
subsequent averaging period, any refiner for each refinery or group of 
refineries at which any conventional gasoline is produced, and any 
importer that imports any conventional gasoline, shall submit to the 
Administrator a report which contains the following information:
    (1) The total gallons of conventional gasoline produced or 
imported;
    (2) The total gallons of applicable blendstocks produced or 
imported and transferred to others;
    (3) The total gallons of blendstocks included in compliance 
calculations pursuant to Sec. 80.102(e)(2);
    (4) The average exhaust benzene emissions, sulfur, olefins and T90 
if using the Simple Model; exhaust benzene emissions if using the 
optional Complex Model; or exhaust toxic emissions and NOX 
emissions if using the Complex Model, as applicable, calculated in 
accordance with Sec. 80.101;
    (5) The following information for each batch of conventional 
gasoline or batch of blendstock included under paragraph (a) of this 
section:
    (i) The batch number;
    (ii) The date of production;
    (iii) The volume of the batch;
    (iv) The grade of gasoline produced (i.e., premium, mid-grade, or 
regular); and
    (v) The properties, pursuant to Sec. 80.101(i); and
    (6) Such other information as EPA may require.
    (b) The reporting requirements of paragraph (a) of this section do 
not apply in the case of any conventional gasoline or gasoline 
blendstock that is excluded from a refiner's or importer's compliance 
calculation pursuant to Sec. 80.101(e).
    (c) For each averaging period, each refiner and importer shall 
cause to be submitted to the Administrator of EPA, by May 30 of each 
year, a report in accordance with the requirements for the Attest 
Engagements of Secs. 80.125 through 80.131.
    (d) The report required by paragraph (a) of this section shall be:
    (1) Submitted on forms and following procedures specified by the 
Administrator of EPA;
    (2) Submitted to EPA by the last day of February each year for the 
prior calendar year averaging period; and
    (3) Signed and certified as correct by the owner or a responsible 
corporate officer of the refiner or importer.


Sec. 80.106  Product transfer documents.

    (a)(1) On each occasion when any person transfers custody or title 
to any conventional gasoline, the transferor shall provide to the 
transferee documents which include the following information:
    (i) The name and address of the transferor;
    (ii) The name and address of the transferee;
    (iii) The volume of gasoline being transferred;
    (iv) The location of the gasoline at the time of the transfer;
    (v) The date of the transfer;
    (vi) In the case of transferors or transferees who are refiners or 
importers, the EPA-assigned registration number of those persons; and
    (vii) The following statement: ``This product does not meet the 
requirements for reformulated gasoline, and may not be used in any 
reformulated gasoline covered area.''
    (2) The requirements of paragraph (a)(1) of this section apply to 
product that becomes gasoline upon the addition of oxygenate only.
    (b) On each occasion when any person transfers custody or title to 
any blendstock that has been included in the refiner's or importer's 
compliance calculations under Sec. 80.102(e)(2), the transferor shall 
provide to the transferee documents which include the following 
statement: ``For purposes of the Anti-Dumping requirements under 40 CFR 
Part 80, Subpart E, this blendstock has been accounted for by the 
refiner that produced it, and must be excluded from any subsequent 
compliance calculations.''


Secs. 80.107-80.124  [Reserved]

Subpart F--Attest Engagements


Sec. 80.125  Attest engagements.

    (a) Any refiner, importer, and oxygenate blender subject to the 
requirements of this subpart F shall engage an independent certified 
public accountant, or firm of such accountants (hereinafter referred to 
in this subpart F as ``CPA''), to perform an agreed-upon procedures 
attestation engagement of the underlying documentation that forms the 
basis of the reports by Secs. 80.75 and 80.104.
    (b) The CPA shall perform the attestation engagements in accordance 
with the Statements on Standards for Attestation Engagements.
    (c) The CPA may complete the requirements of this subpart F with 
the assistance of internal auditors who are employees or agents of the 
refiner, importer, or oxygenate blender, so long as such assistance is 
in accordance with the Statements on Standards for Attestation 
Engagements.
    (d) Notwithstanding the requirements of paragraph (a) of this 
section, any refiner, importer, or oxygenate blender may satisfy the 
requirements of this subpart F if the requirements of this subpart F 
are completed by an auditor who is an employee of the refiner, 
importer, or oxygenate blender, provided that such employee:
    (1) Is an internal auditor certified by the Institute of Internal 
Auditors, Inc. (hereinafter referred to in this subpart F as ``CIA''); 
and
    (2) Completes the internal audits in accordance with the 
Codification of Standards for the Professional Practice of Internal 
Auditing.
    (e) Use of a CPA or CIA who is debarred, suspended, or proposed for 
debarment pursuant to the Governmentwide Debarment and Suspension 
Regulations, 40 CFR Part 32, or the Debarment, Suspension, and 
Ineligibility Provisions of the Federal Acquisition Regulations, 48 CFR 
part 9, subpart 9.4, shall be deemed in noncompliance with the 
requirements of this section.
    (f) The following documents are incorporated by reference: the 
Statements on Standards for Attestation Engagements, Codification of 
Statements on Auditing Standards, written by the American Institute of 
Certified Public Accountants, Inc., 1991, and published by the Commerce 
Clearing House, Inc., Identification Number 059021, and the 
Codification of Standards for the Professional Practice of Internal 
Auditing, written and published by the Institute of Internal Auditors, 
Inc., 1989, Identification Number ISBN 0-89413-207-5. These 
incorporations by reference were approved by the Director of the 
Federal Register in accordance with 5 U.S.C. 552(a) and 1 CFR part 51. 
Copies of the Statements on Standards for Attestation Engagements may 
be obtained from the American Institute of Certified Public 
Accountants, Inc., 1211 Avenue of the Americas, New York, New York 
10036, and copies of the Codification of Standards for the Professional 
Practice of Internal Auditing may be obtained from the Institute of 
Internal Auditors, Inc., 249 Maitland Avenue, Altamonte Springs, 
Florida 32701-4201. Copies may be inspected at the U.S. Environmental 
Protection Agency, Office of the Air Docket, 401 M Street, SW., 
Washington, DC., or at the Office of the Federal Register, 800 North 
Capitol Street, NW., suite 700, Washington DC.


Sec. 80.126  Definitions.

    The following definitions shall apply for the purposes of this 
subpart F:
    (a) Averaging compliance records shall include the calculations 
used to determine compliance with relevant standards on average, for 
each averaging period and for each quantity of gasoline for which 
standards must be achieved separately.
    (b) Credit trading records shall include worksheets and EPA reports 
showing actual and complying totals for oxygen and benzene; credit 
calculation worksheets; contracts; letter agreements; and invoices and 
other documentation evidencing the transfer of credits.
    (c) Designation records shall include laboratory analysis reports 
that identify whether gasoline meets the requirements for a given 
designation; operational and accounting reports of product storage; and 
product transfer documents.
    (d) Oxygenate blender records shall include laboratory analysis 
reports; refiner, importer and oxygenate blender contracts; quality 
assurance program records; product transfer documents; oxygenate 
purchasing, inventory, and usage records; and daily tank inventory 
gauging reports, meter tickets, and product transfer documents.
    (e) Product transfer documents shall include documents that reflect 
the transfer of ownership or physical custody of gasoline or 
blendstock, including invoices, receipts, bills of lading, manifests, 
and pipeline tickets.
    (f) A tender means the physical transfer of custody of a volume of 
gasoline or other petroleum product all of which has the same 
identification (reformulated gasoline, conventional gasoline, RBOB, and 
other non-finished gasoline petroleum products), and characteristics 
(time and place of use restrictions for reformulated gasoline).
    (g) Volume records shall include summaries of gasoline produced or 
imported that account for the volume of each type of gasoline produced 
or imported. The volumes shall be based on tank gauges or meter reports 
and temperature adjusted to 60 degrees Fahrenheit.


Sec. 80.127  Sample size guidelines.

    In performing the attest engagement, the auditor shall sample 
relevant populations to which agreed-upon procedures will be applied 
using the methods specified in this section, which shall constitute a 
representative sample.
    (a) Sample items shall be selected in such a way as to comprise a 
simple random sample of each relevant population; and
    (b) Sample size shall be determined using one of the following 
options:
    (1) Option 1. Determine the sample size using the following table:

                Sample Size, Based Upon Population Size                 
------------------------------------------------------------------------
       No. in population (N)                     Sample size            
------------------------------------------------------------------------
66 and larger......................  29                                 
41-65..............................  25                                 
26-40..............................  20                                 
0-25...............................  N or 19, whichever is smaller.     
------------------------------------------------------------------------

    (2) Option 2. Determine the sample size in such a manner that the 
sample size is equal to that which would result by using the following 
parameters and standard statistical methodologies:

Confidence Level--95%
Expected Error Rate--0%
Maximum Tolerable Error Rate--10%

    (3) Option 3. The auditor may use some other form of sample 
selection and/or some other method to determine the sample size, 
provided that the resulting sample affords equal or better strength of 
inference and freedom from bias (as compared with paragraphs (b)(1) and 
(2) of this section), and that the auditor summarizes the substitute 
methods and clearly demonstrates their equivalence in the final report 
on the audit.


Sec. 80.128  Agreed upon procedures for refiners and importers.

    The following are the minimum attest procedures that shall be 
carried out for each refinery and importer. Agreed upon procedures may 
vary from the procedures stated in this section due to the nature of 
the refiner's or importer's business or records, provided that any 
refiner or importer desiring to modify procedures obtains prior 
approval from EPA.
    (a) Read the refiner's or importer's reports filed with EPA for the 
previous year as required by Secs. 80.75 and 80.105.
    (b) Obtain a gasoline inventory reconciliation analysis for the 
current year from the refiner or importer which includes reformulated 
gasoline, RBOB, conventional gasoline, and non-finished-gasoline 
petroleum products.
    (1) Test the mathematical accuracy of the calculations contained in 
the analysis.
    (2) Agree the beginning and ending inventories to the refiner's or 
importer's perpetual inventory records.
    (c) Obtain separate listings of all tenders during the current year 
of reformulated gasoline, RBOB, conventional gasoline, and non-
finished-gasoline petroleum products.
    (1) Test the mathematical accuracy of the calculations contained in 
the listings.
    (2) Agree the listings of tenders' volumes to the gasoline 
inventory reconciliation in paragraph (b) of this section.
    (3) Agree the listings of tenders' volumes, where applicable, to 
the EPA reports.
    (d) Select a representative sample from the listing of reformulated 
gasoline tenders, and for this sample:
    (1) Agree the volumes to the product transfer documents;
    (2) Compare the product transfer documents designation for 
consistency with the time and place, and compliance model designations 
for the tender (VOC-controlled or non-VOC-controlled, VOC region for 
VOC-controlled, OPRG versus non-OPRG, summer or winter gasoline, and 
simple or complex model certified); and
    (3) Trace back to the batch or batches in which the gasoline was 
produced or imported. Obtain the refiner's or importer's internal 
laboratory analyses for each batch and compare such analyses for 
consistency with the analyses results reported to EPA and to the time 
and place designations for the tender's product transfer documents.
    (e) Select a representative sample from the listing of RBOB 
tenders, and for this sample:
    (1) Agree the volumes to the original product transfer documents;
    (2) Determine that the requisite contract was in place with the 
downstream blender designating the required blending procedures, or 
that the refiner or importer accounted for the RBOB using the 
assumptions in Sec. 80.72(a)(9);
    (3) Review the product transfer documents for the indication of the 
type and amount of oxygenate required to be added to the RBOB;
    (4) Trace back to the batch or batches in which the RBOB was 
produced or imported. Obtain refiner's or importer's internal lab 
analysis for each batch and agree the consistency of the type and 
volume of oxygenate required to be added to the RBOB with that 
indicated in applicable tender's product transfer documents; and
    (5) Agree the sampling and testing frequency of the refiner's or 
importer's downstream oxygenated blender quality assurance program with 
the sampling and testing rates as required in Sec. 80.72.
    (f) Select a representative sample of reformulated gasoline and 
RBOB batches produced by computerized in-line blending, and for this 
sample:
    (1) Obtain the composite sample internal laboratory analyses 
results; and
    (2) Agree the results of the internal laboratory analyses to the 
quarterly batch information submitted to the EPA.
    (g) Select a representative sample from the listing of the tenders 
of conventional gasoline and conventional gasoline blendstock that 
becomes gasoline through the addition of oxygenate only, and for this 
sample:
    (1) Agree the volumes to the product transfer documents;
    (2) For a representative sample of tenders, trace back to the batch 
or batches in which the gasoline was produced or imported. Obtain the 
refiner's or importer's internal laboratory analyses for each batch and 
compare such analyses for consistency with the analyses results 
reported to EPA; and
    (3) Where the refiner or importer has included oxygenate that is 
blended downstream of the refinery or import facility in its compliance 
calculations in accordance with Sec. 80.101(d)(4)(ii), obtain a listing 
of each downstream oxygenate blending operation from which the refiner 
or importer is claiming oxygenate for use in compliance calculations, 
and for each such operation:
    (i) Determine if the refiner or importer had a contract in place 
with the downstream blender during the period oxygenate was blended;
    (ii) Determine if the refiner or importer has records reflecting 
that it conducted physical inspections of the downstream blending 
operation during the period oxygenate was blended;
    (iii) Obtain a listing from the refiner or importer of the batches 
of conventional gasoline or conventional sub-octane blendstock, and the 
compliance calculations for which include oxygenate blended by the 
downstream oxygenate blender, and test the mathematical accuracy of the 
calculations contained in this listing;
    (iv) Obtain a listing from the downstream oxygenate blender of the 
oxygenate blended with conventional gasoline or sub-octane blendstock 
that was produced or imported by the refiner or importer. Test the 
mathematical accuracy of the calculations in this listing. Agree the 
overall oxygenate blending listing obtained from the refiner or 
importer with the listing obtained from the downstream oxygenate 
blender. Select a representative sample of oxygenate blending listing 
obtained from the downstream oxygenate blender, and for this sample:
    (A) Using product transfer documents, determine if the oxygenate 
was blended with conventional gasoline or conventional sub-octane 
blendstock that was produced by the refiner or imported by the 
importer; and
    (B) Agree the oxygenate volume with the refiner's or importer's 
listing of oxygenate claimed for this gasoline;
    (v) Obtain a listing of the sampling and testing conducted by the 
refiner or importer over the downstream oxygenate blending operation. 
Select a representative sample of the test results from this listing, 
and for this sample agree the tested oxygenate volume with the 
oxygenate use listings from the refiner or importer, and from the 
oxygenate blender; and
    (vi) Obtain a copy of the records reflecting the refiner or 
importer audit over the downstream oxygenate blending operation. Review 
these records for indications that the audit included review of the 
overall volumes and type of oxygenate purchased and used by the 
oxygenate blender to be consistent with the oxygenate claimed by the 
refiner or importer and that this oxygenate was blended with the 
refiner's or importer's gasoline or blending stock.
    (h) In the case of a refiner or importer that is not exempt from 
blendstock tracking under Sec. 80.102(f):
    (1) Obtain listings for those tenders of non-finished-gasoline 
classified by the refiner or importer as:
    (i) Applicable blendstock which is included in the refiner's or 
importer's blendstock tracking calculations pursuant to Sec. 80.102(b) 
through (d);
    (ii) Applicable blendstock which is exempt pursuant to 
Sec. 80.102(d)(3) from inclusion in the refiner's or importer's 
blendstock tracking calculations pursuant to Sec. 80.102 (b) through 
(d); and
    (iii) All other non-finished-gasoline petroleum products.
    (2) Test the mathematical accuracy of the calculations contained in 
the analysis.
    (3) Agree the listings of tenders' volumes to the gasoline 
inventory reconciliation in paragraph (b) of this section.
    (4) Agree the EPA report for the volume classified as applicable 
blendstock pursuant to the requirements of Sec. 80.102.
    (5) Select a representative sample from the listing of applicable 
blendstock which is reported to EPA, and for such sample:
    (i) Agree the volumes to records supporting the transfer of the 
tender to another person; and
    (ii) Trace back to the batch or batches in which the non-finished-
gasoline petroleum product was produced or imported. Obtain the 
refiner's or importer's internal laboratory analysis for each batch and 
compare such analysis for consistency with the product type assigned by 
the refiner or importer (e.g., reformate, light coker naphtha, etc.), 
and that this product type is included in the applicable blendstock 
list at Sec. 80.102(a).
    (6) Select a representative sample from the listing of applicable 
blendstock which is exempt from inclusion in the blendstock tracking 
report to EPA, and for such sample:
    (i) Agree the volumes to records supporting the transfer of the 
tender to another person;
    (ii) Trace back to the batch or batches in which the non-finished-
gasoline petroleum product was produced or imported. Obtain the 
refiner's or importer's internal laboratory analysis for each batch and 
compare such analysis for consistency with the product type assigned by 
the refiner or importer (e.g., reformate, light coker naphtha, etc.), 
and that this product type is included in the applicable blendstock 
list at Sec. 80.102(a); and
    (iii) Obtain the documents that demonstrate the purpose for which 
the product was used, and agree that the documented purpose is one of 
those specified at Sec. 80.102(d)(3).
    (7) Select a representative sample from the listing of all other 
non-finished-gasoline petroleum products, and for such sample:
    (i) Agree the volumes to records supporting the transfer of the 
tender to another person;
    (ii) Trace back to the batch or batches in which the non-finished-
gasoline petroleum product was produced or imported. Obtain the 
refiner's or importer's internal laboratory analysis for each batch and 
compare such analysis for consistency with the product-type assigned by 
the refiner or importer (e.g., alkylate, isobutane, etc.), and agree 
that this product type is excluded from the applicable blendstock list 
at Sec. 80.102(a).
    (i) In the case of a refiner or importer required to account for 
blendstocks produced or imported under Sec. 80.102(e)(2):
    (1) Obtain listings for those tenders of non-finished-gasoline 
tenders classified by the refiner or importer as:
    (i) Blendstock which is included in the compliance calculations for 
the refinery or importer; and
    (ii) All other non-finished-gasoline petroleum products;
    (2) Test the mathematical accuracy of the calculations contained in 
the listings under paragraph (i)(1) of this section;
    (3) Agree the listings of tenders' volumes to the gasoline 
inventory reconciliation in paragraph (b) of this section;
    (4) Select a representative sample from the listing of blendstock 
tenders which are included in the compliance calculations for the 
refinery or importer, and for such sample:
    (i) Agree the volumes to records supporting the transfer of the 
tender to another person;
    (ii) Review the product transfer documents for the statement 
indicating the blendstock has been accounted-for, and may not be 
included in another party's compliance calculations; and
    (iii) Trace back to the batch or batches in which the blendstock 
was produced or imported. Obtain the refiner's or importer's internal 
laboratory analyses for each batch and compare such analyses for 
consistency with the analyses results reported to EPA; and
    (5) Select a representative sample from the listing of tenders of 
non-finished-gasoline petroleum products that are excluded from the 
refiner's or importer's compliance calculations, and for such sample 
confirm that documents demonstrate the petroleum products were used for 
a purpose other than the production of gasoline within the United 
States.


Sec. 80.129  Agreed upon procedures for downstream oxygenate blenders.

    The following are the procedures to be carried out at each 
oxygenate blending facility that is subject to the requirements of this 
subpart F:
    (a) Read the blenders reports filed with the EPA for the previous 
year as required by Sec. 80.75.
    (b) Obtain a material balance analysis summarizing receipts of RBOB 
and oxygenate to the blender, and the deliveries of reformulated 
gasoline from the blender.
    (1) Test the mathematical accuracy of the calculations contained in 
the analysis.
    (2) Agree the beginning and ending inventory to the blender's 
perpetual inventory records.
    (3) Agree the analysis, where applicable, to the EPA reports.
    (c) Obtain a listing of all RBOB receipts for the previous year.
    (1) Test the mathematical accuracy of the volumetric calculations 
contained in the listing.
    (2) Agree the volumetric calculations of RBOB receipts to the 
calculations contained in the material balance analysis.
    (3) Select a representative sample of RBOB receipts from the 
listing. Review the product transfer documents for the indication of 
the type and volume of oxygenate required to be added to the RBOB.
    (d) Obtain a listing of all reformulated gasoline batches produced 
by the blender during the previous year.
    (1) Test the mathematical accuracy of the volumetric calculations 
contained in the listing.
    (2) Agree the volumetric calculations contained in the listing to 
the calculations contained in the material balance analysis.
    (3) Select a representative sample of the batches from the listing, 
and for these batches:
    (i) Obtain the blender's records that indicate the volume and type 
of oxygenate that was blended, the volume of RBOB that was blended and 
the product transfer documents for the RBOB, and the internal lab 
analysis where applicable;
    (ii) Agree the consistency of the type and volume of oxygenate 
added to the RBOB with that indicated to be added in the RBOB's product 
transfer documents;
    (iii) Recalculate the actual oxygen content based on the volumes 
blended and agree to the report to EPA on oxygen; and
    (iv) Review the time and place designations in the product transfer 
documents prepared for the batch by the blender, for consistency with 
the time and place designations in the product transfer documents for 
the RBOB (e.g., VOC-controlled or non-VOC-controlled, VOC region for 
VOC-controlled, OPRG versus non-OPRG, and simple or complex model).
    (e) Agree the sampling and testing frequency of the blender's 
quality assurance program with the sampling and testing rates required 
in Sec. 80.72.


Sec. 80.130  Agreed upon procedures reports.

    (a) Reports. (1) The CPA or CIA shall issue to the refiner, 
importer, or blender a report summarizing the procedures performed and 
the findings in accordance with the attest engagement or internal audit 
performed in compliance with this subpart.
    (2) The refiner, importer or blender shall provide a copy of the 
auditor's report to the EPA within the time specified in Sec. 80.75(m).
    (b) Record retention. The CPA or CIA shall retain all records 
pertaining to the performance of each agreed upon procedure and 
pertaining to the creation of the agreed upon procedures report for a 
period of five years from the date of creation and shall deliver such 
records to the Administrator upon request.


Secs. 80.131-80.135  [Reserved]

[FR Doc. 94-20 Filed 2-15-94; 8:45 am]
BILLING CODE 6560-50-P