[Federal Register Volume 63, Number 144 (Tuesday, July 28, 1998)]
[Proposed Rules]
[Pages 40202-40208]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-20129]


=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF ENERGY

10 CFR Part 490

Office of Energy Efficiency and Renewable Energy
[Docket No. EE-RM-98-PURE]
RIN 1904-AA99


Alternative Fuel Transportation Program; P-series fuels

AGENCY: Department of Energy (DOE).

ACTION: Notice of proposed rulemaking and opportunity for public 
comment.

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

SUMMARY: In response to a petition filed by Pure Energy Corporation, 
DOE proposes to amend the rules for the statutory program requiring 
certain alternative fuel providers and State government fleets to 
acquire an annually increasing percentage of alternative fueled 
vehicles from among their purchases of new light duty vehicles. The 
proposed regulatory amendments would add certain blends of 
methyltetrahydrofuran, ethanol and hydrocarbons known as the P-series 
fuels to the definition of ``alternative fuel.''

DATES: Written comments, eight (8) copies, must be received by DOE by 
September 28, 1998.

ADDRESSES: Written comments should be addressed to: U.S. Department of 
Energy, Office of Transportation Technologies, EE-34, Docket No. EE-RM-
98-PURE, 1000 Independence Avenue, SW, Washington, DC 20585, telephone 
(202) 586-3012.
    Copies of the Pure Energy Corporation petition for rulemaking, 
analyses of the petition by national laboratories, written comments 
received, technical reference materials mentioned in this notice, and 
any other documents related to this rulemaking may be read and copied 
at the DOE Freedom of Information Reading Room, Room 1E-190, 1000 
Independence Avenue, SW, Washington, DC 20585, telephone (202) 586-
3142, between the hours of 9:00 a.m. and 4:00 p.m., Monday through 
Friday, except Federal holidays. The docket file material will be filed 
under EE-RM-98-PURE.
    For more information concerning public participation in this 
rulemaking proceeding, see section III of this notice (Public Comment 
Procedures).

FOR FURTHER INFORMATION CONTACT: Kenneth R. Katz, Office of Energy 
Efficiency and Renewable Energy, (EE-34), U.S. Department of Energy, 
1000 Independence Avenue, S.W., Washington, D.C. 20585, (202) 586-9171.
    For information concerning submission of written comments and to 
obtain copies of materials referenced in this notice, contact Andi 
Kasarsky, (202) 586-3012.

SUPPLEMENTARY INFORMATION:

I. Introduction and Background

A. Fuel Characteristics

    Pure Energy Corporation has petitioned DOE for a rulemaking to add 
its proprietary fuel products to the definition of ``alternative 
fuels'' under the Alternative Fuel Transportation Program (Program) 
regulations (10 CFR part 490). Pure Energy Corporation's P-series fuels 
are blends of ethanol, methyltetrahydrofuran (MTHF), and pentanes plus, 
with butane added for blends that would be used in severe cold-weather 
conditions to meet cold start requirements. It is anticipated that both 
the ethanol and the MTHF will be derived from renewable resources, such 
as waste cellulosic biomass that can be derived from waste paper, 
agricultural waste and urban/industrial wood waste. Pure Energy 
Corporation plans to use pentanes plus that are derived from the 
processing and production of natural gas, as opposed to those derived 
from refining processes. Pure Energy Corporation holds the exclusive 
worldwide license to manufacture and distribute the P-series fuels, 
which were developed by Dr. Stephen Paul of Princeton University. The 
P-series fuels were awarded Patent number 5,697,987 by the United 
States Patent and Trademark Office on December 16, 1997. DOE's 
evaluation of Pure Energy Corporation's petition is restricted to those 
formulations covered under this patent.
    To make the P-series fuels, Pure Energy Corporation will be 
producing ethanol and MTHF through an integrated production process. 
Pure Energy Corporation expects to utilize commercially proven 
concentrated acid hydrolysis processing as its base technology for this 
integrated production process. MTHF is currently produced in limited 
quantities from furfural (derived from both biomass and petroleum 
feedstocks) for use as a specialty chemical in consumer end products 
and/or process industries.
    Pure Energy Corporation has developed a thermochemical technology 
to produce MTHF from cellulosic feedstocks through a levulinic acid 
pathway, integrating it with an ethanol production system to achieve 
technical and economic efficiencies. In this process, the 
lignocellulosic feedstock is converted into both five-and six-carbon 
sugars, which are then bifurcated into fermentation and thermochemical 
pathways to produce ethanol and MTHF, respectively.
    Pure Energy Corporation has developed several fuel formulations for 
the P-series fuels. Pure Energy Corporation proposes to vary the 
components of its P-series fuels to meet particular market demands. The 
formulations described in Table 1 are those for which Pure Energy 
Corporation, in its petition, provided specific energy and emission 
data. Pure Energy Corporation claims that the volumetric percentages of 
each of the components of the P-series fuels can

[[Page 40203]]

range from 10 percent to 50 percent for pentanes plus; from 15 percent 
to 55 percent for MTHF; from 25 percent to 55 percent for ethanol; and 
from zero to 15 percent for normal butane. However, data was not 
provided to DOE for fuel formulations that incorporate the entire 
blending range. Data was provided to DOE only for the three specific 
formulations discussed in this notice. Table 1 provides the 
compositions, by volume, of the three P-series fuel formulations which 
are the subject of Pure Energy Corporation's petition for rulemaking.

                                                     Table 1                                                    
----------------------------------------------------------------------------------------------------------------
                                    Volume composition of the P-series fuels                                    
-----------------------------------------------------------------------------------------------------------------
                        Constituent                              Regular           Premium        Cold weather  
----------------------------------------------------------------------------------------------------------------
Pentanes plus.............................................              32.5              27.5              16.0
MTHF......................................................              32.5              17.5              26.0
Ethanol...................................................              35.0              55.0              47.0
Normal butane.............................................               0                 0                11.0
----------------------------------------------------------------------------------------------------------------

    Pure Energy Corporation claims that its P-series fuels are from 60 
to 100 percent non-petroleum, on an energy basis, depending on the 
source of the pentanes plus and n-butane components of the blends.
    Pure Energy Corporation proposes to market the P-series fuels for 
flexible fuel vehicles (FFVs) originally designed to operate on E-85 
(85 percent ethanol/15 percent gasoline), on gasoline, or on any blend 
of those two fuels. Flexible fuel vehicles are currently available from 
two major domestic auto manufacturers as mid-size sedans and minivans. 
In the near future, a large number of minivans and compact pickup 
trucks will be produced as flexible-fuel vehicles by these two domestic 
manufacturers.

B. Patent

    On December 16, 1997, the United States Patent and Trademark Office 
issued U.S. Patent No. 5,697,987, titled Alternative Fuel, to Princeton 
University on a new, non-petroleum substitute for gasoline called the 
P-series. The abstract for this patent reads:

    A spark ignition motor fuel composition consisting essentially 
of: a hydrocarbon component containing one or more hydrocarbons 
selected from five to eight carbon atoms straight-chained or 
branched alkanes essentially free of olefins, aromatics, benzene and 
sulfur, wherein the hydrocarbon component has a minimum anti-knock 
index of 65 as measured by ASTM D-2699 and D-2700 and a maximum DVPE 
of 15 psi as measured by ASTM D-5191; a fuel grade alcohol; and a 
co-solvent for the hydrocarbon component and the fuel grade alcohol; 
wherein the hydrocarbon component, the fuel grade alcohol and the 
co-solvent are present in amounts selected to provide a motor fuel 
with a minimum anti-knock index of 87 as measured by ASTM D2699 and 
D-2700, and a maximum DVPE of 15 psi as measured by ASTM D-5191. A 
method for lowering the vapor pressure of a hydrocarbon-alcohol 
blend by adding a co-solvent for the hydrocarbon and the alcohol to 
the blend is also disclosed.

C. Background

    10 CFR part 490 sets forth the regulations that implement title V 
of the Energy Policy Act 1992 (EPACT) (Public Law 102-486) which 
mandates alternative fueled vehicle acquisition requirements for 
certain alternative fuel providers and State government fleets. Part 
490 is one of a variety of EPACT programs to promote alternative and 
replacement fuels that reduce reliance on imported oil, reduce criteria 
pollutant and greenhouse gas emissions, increase energy efficiency, and 
help displace 10 percent and 30 percent of conventional motor fuels by 
2000 and 2010, respectively.
    Title III of EPACT requires Federal fleet acquisitions of 
alternative fueled vehicles. Title IV includes specific authority for a 
financial incentive program for States, a public information program, 
and a program for certifying alternative fueled vehicle technician 
training programs. In addition to the mandates for the purchase of 
alternative fueled vehicles by certain alternative fuel providers and 
State government fleets, title V provides for a possible similar 
mandate for certain private and municipal fleets. Title VI provides for 
a program to promote electric motor vehicles.
    The types of vehicles that satisfy the alternative fuel provider 
and State government fleet mandates in title V are determined in part 
by the definition of ``alternative fuel'' in section 301(2). That 
definition provides: `` `Alternative fuel' means methanol, denatured 
ethanol, and other alcohols; mixtures containing 85 percent or more (or 
such other percentage, but not less than 70 percent, as determined by 
the Secretary, by rule, to provide for requirements relating to cold 
start, safety, or vehicle functions) by volume of methanol, denatured 
ethanol , and other alcohols with gasoline or other fuels; natural gas; 
liquefied petroleum gas; hydrogen; coal-derived liquid fuels; fuels 
(other than alcohol) derived from biological materials; electricity 
(including electricity from solar energy); and any other fuel the 
Secretary determines, by rule, is substantially not petroleum, and 
would yield substantial energy security benefits and substantial 
environmental benefits.'' [Emphasis added.] 42 U.S.C. 13211(2). The P-
series fuels do not fit within the classes of eligible fuels 
specifically named in section 301(2). The emphasized phrase in the 
definition of ``alternative fuel'' states the minimum procedural and 
substantive requirements for adding a new fuel blend to the list of 
fuels enumerated or implicitly covered by the provisions of section 
301(2).
    In the rulemaking to establish 10 CFR part 490, DOE concluded that 
Congress deliberately omitted reformulated gasoline (RFG) from the 
definition of ``alternative fuel'' in section 301(2) of the Act. The 
basis for this conclusion was explained in a final rule at 61 FR 10622 
(March 14, 1996). The relatively small percentage of non-petroleum 
content in RFG was an important consideration in that explanation.
    For reasons set forth in detail below, DOE proposes to determine 
that the P-series fuels, as described by United States Patent number 
5,697,987, which contain at least 60 percent non-petroleum energy 
content derived from MTHF (manufactured solely from biomass feedstocks) 
and ethanol, are substantially not petroleum and would yield 
substantial energy security and substantial environmental benefits, and 
thus should be added to the definition of ``alternative fuel'' in 10 
CFR 490.2.

II. Statutory Criteria for Designating Additional Alternative Fuels

    Neither section 301(2) nor any other provision of EPACT states 
specifically or indicates how to measure whether a new fuel: (1) is 
``substantially not petroleum'' and (2) would yield ``substantial 
energy security benefits;'' and (3) would yield ``substantial

[[Page 40204]]

environmental benefits.'' Moreover, these criteria do not purport to be 
exclusive, and in appropriate circumstances, DOE could consider other 
criteria related to achievement of the purposes of the Program.
    Legislative committee report language likewise does not identify 
specifically what numbers and measures Congress viewed as defining the 
minimum that would qualify as substantially not petroleum, substantial 
energy security, and substantial environmental benefits. However, the 
report of the House Committee on Energy and Commerce described the 
pertinent language in section 301(2) as providing ``. . . the Secretary 
with the opportunity to add alternative and replacement fuels that are 
not now being marketed to those specifically identified in the 
legislation.'' [Emphasis added.] H.R. Rep. No. 474(1), 102nd Cong., 2nd 
Sess., 182, reprinted in 1992 U.S. Code Cong. & Admin. News 2005. The 
word ``opportunity'' suggests that the authority to add fuels to the 
definition of ``alternative fuel'' is largely discretionary.

A. Substantially Not Petroleum

    Any standard dictionary or thesaurus indicates that 
``substantially'' is an adverb that can be used to convey a variety of 
subtly different meanings. ``Substantially'' is sometimes used as a 
synonym for the word ``mainly.'' At other times, it is used as a 
synonym for the words ``considerably'' or ``importantly.'' See, e.g., 
Webster's New World Thesaurus 725 (Simon & Schuster, 1985). The former 
is a more narrow usage because the word ``mainly'' means the principal 
and predominant portion of a whole. (Obviously, a fuel that is more 
than 50 percent non-petroleum in energy equivalent terms is ``mainly'' 
and therefore ``substantially not petroleum.'') The latter usage is 
broader because a less than principal or predominant portion of the 
whole could still be large enough to be regarded as ``considerable'' or 
``important.'' Whether to construe ``substantially'' narrowly or 
broadly is a policy question. Since the petition does not involve fuels 
that are less than 50 percent non-petroleum, in terms of energy 
content, it is unnecessary to address this policy question in this 
rulemaking.
    Section 502(b) of the Act establishes goals for replacing the 
projected consumption of motor fuel in the U.S. on an energy equivalent 
basis. The goals provided by this section are that 10% of the motor 
fuel consumed by 2000 and 30% of the motor fuel consumed by 2010 will 
be replacement fuels. These goals are the driving force for all the 
alternative and replacement fuel provisions in the Act. Because the 
achievement of these goals is to be measured on an energy equivalent 
basis, DOE believes that when evaluating a fuel, the determination of 
whether it is ``substantially not petroleum'' should be based on an 
analysis of the fuel's non-petroleum energy content, rather than a 
volumetric analysis of the fuel's non-petroleum content.
    Pure Energy Corporation claims that, on an energy basis, its P-
series fuels will be at least 60 percent derived, and may be 100 
percent derived, from non-petroleum sources, depending on the source of 
the light hydrocarbons in the blends. In its petition, the Pure Energy 
Corporation provided DOE with information and analysis to substantiate 
these claims, and DOE had the National Renewable Energy Laboratory 
(NREL) review those data. NREL confirmed the accuracy of Pure Energy 
Corporation's claim regarding the energy-based, non-petroleum content 
of the P-series fuels. Table 2 summarizes the worst-case (lowest non-
petroleum) makeup of the three P-series fuel formulations, based on the 
net (lower) heating value of all constituents.

                                                     Table 2                                                    
----------------------------------------------------------------------------------------------------------------
                           Verified non-petroleum energy content of the P-series fuels                          
-----------------------------------------------------------------------------------------------------------------
                                                                      Regular         Premium      Cold weather 
                           Constituent                               (percent)       (percent)       (percent)  
----------------------------------------------------------------------------------------------------------------
Pentanes plus...................................................            36.2            33.3            19.1
MTHF............................................................            37.7            22.1            32.3
Ethanol.........................................................            26.1            44.6            37.5
Normal butane...................................................             0.0             0.0            11.2
Non-petroleum...................................................            63.8            66.7            69.8
----------------------------------------------------------------------------------------------------------------

    It is evident to DOE that the MTHF (manufactured from biomass 
feedstock) and the ethanol in the P-series fuels are non-petroleum. 
However, it is less clear as to whether the pentanes plus component is 
non-petroleum. The Department of Energy's Energy Information 
Administration (EIA), in its publication Annual Energy Review 1996, 386 
((DOE/EIA-0384(96)) defines ``pentanes plus'' as ``a mixture of 
hydrocarbons, mostly pentanes and heavier, extracted from natural gas. 
[This] includes isopentane, natural gasoline, and plant condensate.'' 
This same publication also defines petroleum products as including 
``unfinished oils, liquefied petroleum gases, pentanes plus, aviation 
gasoline, motor gasoline, naphtha-type jet fuel, kerosene-type jet 
fuel, kerosene, distillate fuel oil, residual fuel oil, petrochemical 
feedstocks, special naphthas, lubricants, waxes, petroleum coke, 
asphalt, road oil, still gas, and miscellaneous products.'' Ibid. 
However, it is unnecessary to determine whether to restrict pentanes 
plus on the basis of source because the MTHF (manufactured from biomass 
feedstock) and ethanol, which are present in all three fuel blends, 
result in a non-petroleum energy content for the P-series formulations 
of at least 63.8 percent. That percentage is the main or predominant 
portion of the fuel, and even under the narrow definition of 
``substantially,'' the three fuel blends are ``substantially not 
petroleum.''
    Because U.S. Patent number 5,697,987 does not specifically define 
the composition of the P-series fuels, DOE has determined that the 
fuels need to be more specifically described before they can be added 
to the regulatory definition of ``alternative fuel.'' Given that the 
petition shows that the P-series fuels will be at least 60 percent 
derived from non-petroleum sources, DOE will be using that percentage 
as a way of more narrowly defining the P-series fuels, yet allowing 
some variability in the blend components and blend levels. DOE also 
believes that the amount of MTHF and ethanol in the fuels will result 
in a non-petroleum content of at least 60 percent for the P-series 
fuels, absent any other non-petroleum component, if the MTHF is 
manufactured solely from biomass feedstock. Since 60 percent represents 
the main or predominant portion of the P-series fuels covered by the 
petition for

[[Page 40205]]

rulemaking, DOE proposes to determine that they are ``substantially not 
petroleum'' under section 301(2) of the Act.

B. Substantial Energy Security Benefits

    Pure Energy Corporation claims in its petition that the P-series 
fuels are 100 percent domestic and capable of displacing gasoline on 
essentially a gallon-for-gallon basis. Pure Energy Corporation notes 
that each gallon of the P-series fuel directly displaces 0.88 gallons 
of RFG in vehicle use. Pure Energy Corporation also states that the 
energy required to produce a one gallon equivalent of the fuel is 
approximately 13,800 BTUs less than that required to produce one gallon 
of RFG.
    The petition provides information to support a claim that the 
production of the P-series fuels results in a positive energy balance. 
The process efficiency (BTUs produced per BTU of input) of the P-series 
fuels is approximately 2.25 when the ethanol is produced from renewable 
resources, such as biomass. If, however, the ethanol is produced from 
corn, the process efficiency is slightly lower, with a value between 
1.75 and 1.88. Although the process efficiency is slightly lower when 
the ethanol is derived from corn, production of ethanol from either 
feedstock represents a significant energy savings for the life cycle of 
the fuel.
    DOE has had NREL and Argonne National Laboratory (ANL) examine 
these claims. The analyses, ``Review of Pure Energy Petition for 
Alternative Fuel Status'' (NREL) and ``Assessment of Fuel-Cycle Energy 
Use and Greenhouse Gas Emissions of Pure Energy's Proprietary Motor 
Fuel'' (ANL) can be reviewed at DOE's Freedom of Information Reading 
Room under Docket Number EE-RM-98-PURE. These analyses support Pure 
Energy Corporation's claim of significant petroleum displacement, 
although NREL found Pure Energy Corporation's claim of 100 percent 
domestic content to be slightly high.
    NREL estimated that the P-series fuels (regular grade) with 
pentanes plus derived from natural gas would be 96 percent derived from 
domestic resources. NREL believes that the feedstock for ethanol and 
MTHF production will almost certainly be wholly domestic. NREL asserts 
that the feedstock for the pentanes plus and the butane will be either 
natural gas or petroleum. Because a portion of these feedstocks is 
currently and will continue to be imported, it is debatable whether the 
P-series fuels will ever be wholly derived from domestic resources. 
However, if coal gas were used as the feedstock, the pentanes plus 
would be wholly derived from domestic resources. If the pentanes plus 
were derived from refining at oil import levels projected for 2015 (as 
estimated by EIA), the regular grade of the P-series fuel would still 
be 80 percent derived from domestic resources.
    ANL estimated that the P-series fuels could reduce fossil energy 
use by 49 to 57 percent, relative to RFG. ANL also estimates the P-
series fuels could reduce petroleum use by 79 to 81 percent, relative 
to RFG. These estimates are affected by some key assumptions that ANL 
used in its analysis. One assumption is that Pure Energy Corporation's 
fuel production yield per dry ton of biomass is accurate. Another one 
is that Pure Energy Corporation's assumption that the amount of steam 
and electricity required in MTHF/ethanol plants is provided by 
combustion of the lignin cake produced within the plants and that no 
net energy input is required.
    On the basis of the foregoing, DOE proposes that the P-series 
fuels, as described by United States Patent number 5,697,987, which 
contain at least 60 percent non-petroleum energy content derived from 
MTHF (manufactured solely from biomass feedstock) and ethanol, would 
yield ``substantial energy security benefits'' as that phrase is used 
in section 301(2) of the Act.

C. Substantial Environmental Benefits

    Pure Energy Corporation had vehicle tailpipe and evaporative 
emissions tests conducted by an Environmental Protection Agency (EPA) 
certified automotive test laboratory using both the current Federal 
testing procedure (FTP) and the US06 test. 40 CFR part 86. The US06 is 
a high acceleration, aggressive driving schedule developed by the EPA 
that is often identified as a ``Supplemental FTP'' driving schedule. 
The US06 driving cycle is ten minutes in duration and has a maximum 
speed of 80.3 miles per hour. This cycle was developed by EPA in 
conjunction with the California Air Resources Board and vehicle 
manufacturers. The cycle is used by EPA to set emission standards and 
control emissions associated with aggressive, high-speed driving 
conditions not represented by the FTP.
    Pure Energy Corporation's test vehicles, two 1997 Ford Taurus E-85 
flexible-fuel vehicles, were operated on seven fuels: three P-series 
fuels (regular, premium and cold weather), E-85, Federal Certification 
gasoline, California Phase 2 RFG and two commercial ``street'' 
gasolines (a summer and a winter blend). The results were submitted to 
DOE as part of Pure Energy Corporation's petition. Pure Energy 
Corporation also provided an analysis of the greenhouse gas emissions 
associated with the production, distribution and use of the P-series 
fuels and compared them to those of gasoline and E-85.
    Both the criteria pollutant emissions test results and the 
greenhouse gas analysis tend to support Pure Energy Corporation's claim 
of substantial environmental benefits arising from the use of the P-
series fuels. Criteria emissions from the P-series fuels were 
consistently among the lowest of all test fuels, met Federal Tier 1 
standards and statutorily provided Federal Tier 2 standards in every 
case, and compared favorably with those from E-85. The premium P-series 
fuel had better emission characteristics than the regular P-series 
fuel. NREL surmised that this may be due to the increased volume of 
ethanol in the premium fuel. With regard to non-methane hydrocarbons 
(NMHC) and total hydrocarbons, the P-series fuels reduced emissions by 
almost a third compared to Phase 2 RFG. It is worth noting that all of 
the fuels tested had evaporative emissions well below the evaporative 
emissions standard for Federal Tier 1. Table 3 summarizes the results 
of the Federal Test Procedure emissions results (all results in grams 
per mile). The numbers are averages over both cars tested and all FTP 
tests performed, as presented in Pure Energy Corporation's petition.

                                                     Table 3                                                    
----------------------------------------------------------------------------------------------------------------
                        Comparison of Federal test procedure emission results (gram/mile)                       
-----------------------------------------------------------------------------------------------------------------
                                                                                      Carbon         Nitrogen   
                                                                       NMHC          monoxide         oxides    
----------------------------------------------------------------------------------------------------------------
Pure Regular...................................................            0.074           1.081           0.064
Pure Premium...................................................             .064           1.062            .059
Phase II RFG...................................................             .115           1.247            .039

[[Page 40206]]

                                                                                                                
Tier 1 standards...............................................             .250           3.4              .4  
Tier 2 standards...............................................             .125           1.7              .2  
----------------------------------------------------------------------------------------------------------------

    The Tier 2 standards that are referenced in Table 3 are the pending 
standards identified by Congress in section 202(i) of the Clean Air Act 
(CAA). Section 202(i) of the CAA outlines a process for assessing 
whether more stringent exhaust emission reductions from light duty 
vehicles and light duty trucks should be required. Congress required 
EPA to report the results of this assessment. Congress identified 
specific standards that EPA must consider in making this assessment, 
but stated that the study should also consider other possible 
standards. These standards, referred to as ``Tier 2 standards'', would 
be more stringent than the standards required for light duty vehicles 
and light duty trucks in the CAA beginning in model year 1994, but 
could not be implemented prior to the 2004 model year.
    EPA recently released a Draft Tier 2 Study and published a Notice 
of Document Availability regarding this document. 63 FR 23255. This 
study assesses the air quality need, technical feasibility and cost 
effectiveness of more stringent standards. It is DOE's understanding 
that EPA will issue the Tier 2 Report to Congress by July 31, 1998. 
Following submission of this Report to Congress, EPA will, through the 
rulemaking process, determine whether: there is an air quality need for 
further emission reductions; the technology for meeting more stringent 
emissions standards will be available; and whether obtaining further 
reductions in emissions from light duty vehicles and light duty trucks 
is necessary and cost effective.
    As seen in Table 4, the P-series fuels had reduced emissions for 
ozone-forming potential (OFP), carbon monoxide and for air toxics. With 
regard to NOX emissions, indolene and Phase 2 RFG 
outperformed the P-series fuels by a small margin. However, the EPA 
certified test laboratory pointed out that the Taurus' engine could be 
adjusted to significantly reduce NOx emissions, while only 
slightly increasing CO and hydrocarbon emissions to levels well below 
the standard.
    The OFP is a measure of the performance of the fuel-vehicle 
combination, and is calculated by multiplying the fraction of each 
compound in the emissions mixture by its reactivity. The specific 
reactivity is calculated by dividing the OFP by the mass of the non-
methane organic gaseous emissions, and is considered a better gauge of 
the reactivity of the fuels' emissions profile. Table 4 compares the 
emission results of the P-series fuels, indolene, Phase 2 RFG and 
commercial ``street'' gasoline to EPA's National Ambient Air Quality 
Standards (NAAQS). 40 CFR part 63. The numbers are averages over both 
cars tested and all FTP and US06 tests performed, as presented in Pure 
Energy Corporation's petition.

                                                                         Table 4                                                                        
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                               Comparison of emission results related to NAAQS (gram/mile)                                              
---------------------------------------------------------------------------------------------------------------------------------------------------------
                                                             CO                        NOX                       OFP                  Spec. React.      
                                                 -------------------------------------------------------------------------------------------------------
                                                      FTP          USO6         FTP          USO6         FTP          USO6         FTP          USO6   
--------------------------------------------------------------------------------------------------------------------------------------------------------
Indo............................................        1.421        11.99        0.056        0.040        0.488        0.470        3.248        3.092
RFG II..........................................        1.247        10.56         .039         .049         .469         .379        3.640        3.059
Street..........................................        1.427        12.07         .095         .077         .522         .501        3.334        3.070
E85.............................................        1.218         5.15         .056         .079         .494         .087        2.410        3.633
Pure 1..........................................        1.081         6.15         .064         .057         .305         .161        3.360        3.460
Pure 2..........................................        1.062         6.23         .059         .081         .282         .158        2.849        3.568
--------------------------------------------------------------------------------------------------------------------------------------------------------

    The petition stated that the total emissions resulting from the 
production of the P-series fuels are 71 percent lower than those 
associated with the production of one gallon of Phase 2 RFG. Of note 
are the claims that emissions are reduced, relative to Phase 2 RFG, by 
more than 99 percent for methane, by 85 percent for SOx, by 71 percent 
for carbon dioxide and by 68 percent for nitrogen oxides.
    The petition claims that the P-series fuels perform better than 
Phase 2 RFG or indolene in terms of direct carbon dioxide emissions and 
that the P-series fuels will result in significant reductions in carbon 
dioxide emissions when considered on a life-cycle basis. If the P-
series fuels are produced from biomass, as is the desire of Pure Energy 
Corporation, it is claimed that a significant percent of the carbon 
emissions associated with the gasoline life-cycle will be avoided. 
Specifically, it is claimed that the P-series fuels are estimated, on a 
life-cycle basis, to reduce carbon dioxide emissions by at least 63 
percent.
    Regarding toxicity, Pure Energy Corporation claims that its P-
series fuels appear to be less hazardous to human health than 
conventional gasoline. Based on the results of recently conducted 
animal studies, the P-series fuels are claimed to have lower inhalation 
toxicity than gasoline. It is also claimed that the P-series fuels are 
not skin sensitizers and are non-mutagenic/genotoxic in bacterial 
assays.
    DOE had NREL assess the emissions test results and had ANL perform 
an analysis of the full fuel cycle greenhouse gas emissions of the P-
series fuels. NREL confirmed that regular and premium formulations of 
the P-series fuels displayed carbon monoxide, nitrogen oxides and non-
methane hydrocarbon equivalent emissions that met the Tier 1 and 
statutorily provided Tier 2 standards, and that their

[[Page 40207]]

evaporative emissions were well below the Tier 1 standards.
    The FTP and US06 testing included measurements of the four toxics 
associated with vehicle emissions: benzene, 1,3-butadiene, 
formaldehyde, and acetaldehyde. The total toxic emissions were 
presented, along with the potency weighted toxics (PWT) emissions. The 
PWT weighs each individual component by a factor that represents its 
relative toxicity. NREL noted that the emissions of air toxics from the 
P-series fuels were lower than those from all other test fuels, both in 
terms of total mass emissions and in terms of their PWT. As a result, 
the NREL analysis indicates that the P-series fuels hold the promise of 
reduced toxics emissions.
    ANL's evaluation of the full fuel cycle greenhouse gas emissions of 
the P-series fuels confirmed that, over their entire production, 
distribution and end-use cycle, the P-series fuels will result in 
greenhouse gas emissions 45 to 50 percent below those of reformulated 
gasoline. These reductions in greenhouse gas emissions are possible if 
the ethanol component of the P-series fuels is made from biomass, as is 
Pure Energy Corporation's intention.
    On the basis of the foregoing, DOE proposes that the P-series 
fuels, as described by United States Patent number 5,697,987, which 
contain at least 60 percent non-petroleum energy content derived from 
MTHF (manufactured solely from biomass feedstock) and ethanol, would 
yield ``substantial environmental'' benefits as that phrase is used in 
section 301(2) of the Act.

III. Opportunity for Public Comment

A. Participation in Rulemaking

    Interested persons are invited to participate in this proposed 
rulemaking by submitting written data, views, or comments with respect 
to the subject set forth in this notice. Whenever applicable, full 
supporting rationale, data, and detailed analyses should also be 
submitted.

B. Written Comment Procedures

    Written comments (8 copies) should be identified on the outside of 
the envelope, and on the comments themselves, with the designation: 
``P-series Fuel Rulemaking (Docket Number EE-RM-98-PURE)'' and must be 
received by the date specified at the beginning of this notice. In the 
event any person wishing to submit a written comment cannot provide 
eight copies, alternative arrangements may be made in advance by 
calling Ms. Andi Kasarsky at (202) 586-3012.
    All comments received on or before the date specified at the 
beginning of this notice and other relevant information will be 
considered by DOE before final action is taken on the proposed rule. 
All comments submitted will be available for examination in the 
Rulemaking Docket File in DOE's Freedom of Information Reading Room.
    Pursuant to the provisions of 10 CFR 1004.11, any person submitting 
information or data that is believed to be confidential, and which may 
be exempt by law from public disclosure, should submit one complete 
copy, as well as two copies from which the information claimed to be 
confidential has been deleted. The DOE will make its own determination 
of any such claim.

C. Public Hearing

    In DOE's view, today's proposed rulemaking does not involve any 
significant issues of law or fact that would warrant holding a public 
hearing. Moreover, Pure Energy Corporation has not requested such a 
hearing, and the opportunity to file written comments should suffice 
for other members of the public who want DOE to considers their views. 
For these reasons, DOE has not provided for a public hearing in this 
notice. Nevertheless, if members of the public request the opportunity 
to make oral comments and can identify issues that would justify 
scheduling a public hearing, DOE will reconsider its position on 
holding such a hearing

IV. Regulatory and Procedural Requirements

A. Review Under Executive Order 12866

    Today's regulatory action has been determined not to be a 
``significant regulatory action'' under Executive Order 12866, 
``Regulatory Planning and Review,'' 58 FR 51735 (October 4, 1993). 
Accordingly, this rulemaking has not been reviewed by the Office of 
Information and Regulatory Affairs of the Office of Management and 
Budget (OMB).

B. Review Under Executive Order 12612

    Executive Order 12612, ``Federalism,'' 52 FR 41685 (October 30, 
1987) requires that regulations, rules, legislation and other policy 
actions be reviewed for any substantial direct effect on States, on the 
relationship between the National Government and the States, or in the 
distribution of power and responsibilities among various levels of 
government. If there are substantial effects, the Executive Order 
requires the preparation of a federalism assessment to be used in all 
decisions involved in promulgating and implementing policy action. DOE 
has analyzed this rulemaking in accordance with the principles and 
criteria contained in Executive Order 12612, and has determined there 
are no federalism implications that would warrant the preparation of a 
federalism assessment. The rule proposed today would simply allow an 
additional fuel to qualify as an alternative fuel for the purposes of 
the Energy Policy Act of 1992. The proposed rule would not have a 
substantial direct effect on States, the relationship between the 
States and Federal Government, or the distribution of power and 
responsibilities among various levels of government.

C. Review Under the Regulatory Flexibility Act

    The Regulatory Flexibility Act, 5 U.S.C. 601 et seq., requires 
preparation of an initial regulatory flexibility analysis for every 
rule which by law must be proposed for public comment, unless the 
agency certifies that the rule, if promulgated, will not have a 
significant economic impact on a substantial number of small entities. 
Today's proposed rule would provide an additional fuel choice for 
organizations which must comply with the requirements of the 
Alternative Fuel Transportation Fuel Program (10 CFR part 490). There 
is no reason to anticipate any adverse impact. DOE certifies that the 
proposed rule, if promulgated, will not have a significant economic 
impact on a substantial number of small entities.

D. Review Under the National Environmental Policy Act

    The proposed rule would identify the P-series fuels as 
``alternative fuel'' as that term is defined in the Alternative 
Transportation Fuels Program regulations (10 CFR 490.2) and section 
301(2) of the Energy Policy Act (42 U.S.C. 13211(2)). The proposed rule 
interprets statutory and regulatory definitions and would not change 
the environmental effect of the Alternative Fuel Transportation Program 
regulations. DOE, therefore, has determined that this proposed rule is 
covered under the Categorical Exclusion in paragraph A5 to Subpart D, 
10 CFR part 1021. Accordingly, neither an environmental assessment nor 
an environmental impact statement is required.

E. Review Under the Paperwork Reduction Act

    No new collection of information is proposed to be imposed by this

[[Page 40208]]

rulemaking. Accordingly, no clearance by the Office of Management and 
Budget is required under the Paperwork Reduction Act (44 U.S.C. 3501 et 
seq.).

F. Review Under Executive Order 12988

    With respect to the review of existing regulations and the 
promulgation of new regulations, section 3(a) of Executive Order 12988, 
``Civil Justice Reform,'' 61 FR 4729 (February 7, 1996), imposes on 
Executive agencies the general duty to adhere to the following 
requirements: (1) Eliminate drafting errors and ambiguity; (2) write 
regulations to minimize litigation; and (3) provide a clear legal 
standard for affected conduct rather than a general standard and 
promote simplification and burden reduction. Section 3(b) of Executive 
Order 12988 specifically requires that Executive agencies make every 
reasonable effort to ensure that the regulation: (1) clearly specifies 
the preemptive effect, if any; (2) clearly specifies any effect on 
existing Federal law or regulation; (3) provides a clear legal standard 
for affected conduct while promoting simplification and burden 
reduction; (4) specifies the retroactive effect, if any; (5) adequately 
defines key terms; and (6) addresses other important issues affecting 
clarity and general draftsmanship under any guidelines issued by the 
Attorney General. Section 3(c) of Executive Order 12988 requires 
Executive agencies to review regulations in light of applicable 
standards in section 3(a) and section 3(b) to determine whether they 
are met or it is unreasonable to meet one or more of them. DOE has 
completed the required review and determined that, to the extent 
permitted by law, the proposed rule meets the relevant standards of 
Executive Order 12988.

List of Subjects in 10 CFR Part 490

    Administrative practice and procedure, Energy conservation, Fuel, 
Motor vehicles.

    Issued in Washington, DC, on July 13, 1998.
Dan W. Reicher,
Assistant Secretary, Energy Efficiency and Renewable Energy.

    For the reasons set forth in the Preamble, Title 10, Chapter II, 
Subchapter D, of the Code of Federal Regulations is proposed to be 
amended as set forth below:

PART 490--ALTERNATIVE FUEL TRANSPORTATION PROGRAM

    1. The authority cite for Part 490 continues to read as follows:

    Authority: 42 U.S.C. 7191, 13211, 13235, 13251, 13257, 13258, 
13260-3.


Sec. 490.2  [AMENDED]

    2. Section 490.2, Definitions, is amended by adding in the 
definition of ``Alternative Fuel,'' the phrase, ``P-series fuels as 
described by United States Patent number 5,697,987, dated December 16, 
1997, and containing at least 60 percent non-petroleum energy content 
derived from methyltetrahydrofuran (manufactured solely from biomass 
feedstock) and ethanol,'' before ``and electricity (including 
electricity from solar energy).''

[FR Doc. 98-20129 Filed 7-27-98; 8:45 am]
BILLING CODE 6450-01-P