[Federal Register Volume 67, Number 175 (Tuesday, September 10, 2002)]
[Proposed Rules]
[Pages 57347-57349]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-22908]


 ========================================================================
 Proposed Rules
                                                 Federal Register
 ________________________________________________________________________
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 This section of the FEDERAL REGISTER contains notices to the public of 
 the proposed issuance of rules and regulations. The purpose of these 
 notices is to give interested persons an opportunity to participate in 
 the rule making prior to the adoption of the final rules.
 
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 

  Federal Register / Vol. 67, No. 175 / Tuesday, September 10, 2002 / 
Proposed Rules  

[[Page 57347]]



DEPARTMENT OF ENERGY

Office of Energy Efficiency and Renewable Energy

10 CFR Part 490

[Docket No. EE-RM-02-200]


Alternative Fuel Transportation Program; Fischer-Tropsch Diesel 
Fuels

AGENCY: Office of Energy Efficiency and Renewable Energy, Department of 
Energy.

ACTION: Notice of public workshop, document availability, and 
opportunity for comment.

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SUMMARY: The Department of Energy (DOE) announces a public workshop to 
discuss whether Fischer-Tropsch diesel (FTD) fuels meet the energy 
security and environmental criteria of the Energy Policy Act of 1992 
(EPAct) and to resolve a number of technical and EPAct implementation 
issues relating to this fuel. DOE has prepared an analysis, 
``Discussion of Issues Pertinent to Rulemaking to Designate FTD Fuels 
as Alternative Fuel Under Section 301(2) of the Energy Policy Act of 
1992,'' that summarizes the various issues related to evaluation of FTD 
fuels against the EPAct criteria. DOE encourages interested parties to 
respond to these questions and submit related analysis and data as 
requested in the document in the form of written comments, which will 
be discussed at the workshop. The discussion paper finds that there is 
a basis for designating certain FTD fuels as alternative fuels, but 
identifies a number of outstanding questions and data gaps.

DATES: To be considered at the workshop, comments must be received by 
October 10, 2002. The public workshop will be held in Washington, DC, 
beginning at 9:30 a.m. on October 16, 2002.
    Requests to speak at the workshop and a copy of your statement must 
be received no later than 4 p.m., October 1, 2002. We request that you 
also provide an e-mail of your statement by October 8, 2002.
    All comments on the discussion paper and workshop must be received 
by November 15, 2002.

ADDRESSES: The workshop will begin at 9:30 a.m., on October 16, 2002, 
in Room 1E-245 at the U.S. Department of Energy, Forrestal Building, 
1000 Independence Avenue, SW, Washington, DC 20585-0121. Submit written 
comments, oral statements, and requests to speak at the workshop to 
Linda Bluestein, U.S. Department of Energy, Office of Energy Efficiency 
and Renewable Energy, Office of FreedomCAR and Vehicle Technologies, 
Docket No. EE-RM-02-200, EE-2G, 1000 Independence Avenue, SW, 
Washington, DC 20585-0121. You may send e-mail to: 
[email protected].
    Copies of the discussion paper and related DOE laboratory analyses, 
petitions, and any public comments can be found at the at the website 
address http://www.ott.doe.gov/epact/fuel_pet.shtml. You may also 
access these documents using a computer in DOE's Freedom of Information 
(FOI) Reading Room, U.S. Department of Energy, Forrestal Building, Room 
1E-190, 1000 Independence Avenue, SW, Washington, DC 20585-0121, (202) 
586-3142, between the hours of 9 a.m. and 4 p.m., Monday through 
Friday, except Federal holidays. To request a copy of the discussion 
paper or to arrange on-site access to paper copies or other information 
in the docket at the Office of FreedomCAR and Vehicle Technologies, 
contact Linda Bluestein at the phone number or e-mail address below.

FOR FURTHER INFORMATION CONTACT: Linda Bluestein on (202) 586-9171, or 
[email protected].

SUPPLEMENTARY INFORMATION: 

I. Introduction

a. Determination Criteria for Alternative Fuel Designation

    Title III, section 301(2) of EPAct includes the definition of 
``alternative fuel.'' That definition states: ``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 related to cold start, safety, or vehicle functions) 
by volume of methanol, denatured ethanol, and other alcohols with 
gasoline or other fuels; natural gas, including liquid fuels 
domestically produced from 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.] The emphasized portion of that definition states the minimum 
procedural and substantive requirements for adding a new fuel to the 
list of fuels enumerated or implicitly covered by the provisions of 
section 301(2). As part of the Consolidated Appropriations Act (Pub. L. 
106-554), section 301(2) of the Energy Policy Act of 1992 (Pub. L. 102-
486); 42 U.S.C. 13211(2) was amended by inserting, ``including liquid 
fuels domestically produced from natural gas'' after ``natural gas.''
    DOE has conducted technical analyses to help make a determination 
as to whether certain non-domestically produced FTD fuels meet the 
requirements as an ``alternative fuel'' under EPAct, and to resolve a 
number of technical issues relating to DOE's understanding of how these 
fuels might satisfy EPAct requirements. This notice of DOE's discussion 
paper and upcoming workshop constitutes the next step in the technical 
review which will lead to making that determination by way of a notice 
of proposed rulemaking.

b. Petitions To Designate Fischer-Tropsch Diesel

    The action DOE is undertaking is partly in response to three 
petitions DOE has received for a rulemaking to consider adding FTD 
fuels to the definition of ``alternative fuels'' under the Alternative 
Fuel Transportation Program (Program) regulations (10 CFR part 490). 
These petitions have been submitted by Mossgas (PTY) Limited, 
Syntroleum Corporation, and Rentech, Inc. Fischer-Tropsch diesel fuel 
is diesel fuel made from natural gas or other carbon-bearing feedstocks 
using the Fischer-Tropsch process. The three petitioners are proposing 
that their FTD

[[Page 57348]]

fuels be added to the definition of ``alternative fuel'' because the 
fuel conforms to the requirement of being substantially not petroleum 
and yielding substantial energy security and environmental benefits. 
[Note: By rule, effective June 16, 1999, DOE added three specific 
blends of methyltetrahydrofuran, ethanol, and hydrocarbons known as 
``P-series'' fuels to the definition of alternative fuel, 64 FR 26822, 
May 17, 1999.]

II. Technical Review

    DOE has had national laboratory contractors conduct a technical 
review of pertinent issues regarding FTD fuel, including review of the 
three petitions. This technical review involved independent 
verification and findings related to the claims made in these petitions 
about FTD fuel in the following areas: (1) Whether the fuel is 
substantially not petroleum; (2) whether the fuel would yield 
substantial energy security benefits; and (3) whether the fuel would 
yield substantial environmental benefits. In addition to the FTD 
discussion paper, technical support documents by DOE laboratories and 
contractors are available in the docket for review and comment.

III. Generic Designation

    DOE is interested inpromulgating a non-company specific, or 
generic, designation for FTD fuels. Therefore, information and data 
from the individual petitions are being viewed in aggregate, along with 
other industry data, engineering analyses, and other analysis. After 
completion of its technical review, if it is determined FTD fuels meet 
the EPAct section 301(2) criteria, DOE by rule would add any non-
domestically produced FTD fuels to the list of ``alternative fuels'' 
under the Program. Should non-domestic FTD fuels fail to meet the 
criteria, they would not be considered as ``alternative fuels'' under 
the Program.

IV. Explanation of FTD Fuels

    FTD fuels are made from carbon-bearing feedstocks (such as natural 
gas or coal) using the Fischer-Tropsch process. The resulting diesel 
fuel is essentially sulfur-free and can be used in any diesel vehicle 
without modification.
    The Fischer-Tropsch process for producing diesel fuel can be 
separated into three main parts: the production of synthesis gas from 
the main feedstock; the catalytic reaction which converts the synthesis 
gas into hydrocarbon components; and the refining of these hydrocarbon 
components into diesel fuel. Production of synthesis gas is 
accomplished by reforming the feedstock through partial oxidation 
reforming, autothermal reforming, or steam reforming. Autothermal 
reforming can be done with the use of ambient air, enriched air, or 
pure oxygen.
    The catalytic reaction converting synthesis gas into liquid 
hydrocarbons is performed by reacting the synthesis gas in the presence 
of an iron or cobalt catalyst. The end products of the catalytic 
reaction are long-chain hydrocarbons, which can then be refined using 
conventional refinery techniques into FTD fuels.
    The main chemical processes of the Fischer-Tropsch method are 
exothermic and produce waste heat. This waste heat can be radiated to 
the surrounding environment or can be used to produce steam, either for 
resale to local electricity generation plants or for the direct 
generation of electricity at the Fischer-Tropsch plant.
    All three of the petitioning companies use (or plan to use) natural 
gas as the main feedstock for the production of Fischer-Tropsch diesel. 
Rentech is also examining the possibility of using coal as an alternate 
feedstock, and states that petroleum refinery bottoms can also be used. 
The Syntroleum autothermal reformer uses ambient air to produce 
synthesis gas, while the Mossgas process uses a combination of steam 
reforming and oxygen-fired secondary reforming to produce synthesis 
gas. Rentech calls for either partial oxidation reforming or 
autothermal reforming, depending on the feedstock used (coal would 
require the use of partial oxidation reforming), and use of pure 
oxygen. Both Rentech and Mossgas use iron catalysts in producing the 
heavy hydrocarbons from synthesis gas, while Syntroleum is using a 
proprietary cobalt-based catalyst. For the purposes of determining 
whether to designate FTD fuels, DOE is looking specifically at natural 
gas as the feedstock to be used in production of the fuels.
    Issues related to production, energy use, and greenhouse gas 
emissions from processing FTD fuels are included in the discussion 
paper at the website address listed above. DOE believes that FTD fuels 
have potential to offer substantial environmental benefits if 
greenhouse gas emissions are not increased substantially and some other 
environmental issues are addressed.

V. Issues Related to FTD Fuels

    DOE seeks comment on the following issues that may be relevant to 
any future DOE decision to propose the designation of non-domestically 
produced Fischer-Tropsch diesel fuel made from natural gas as an 
alternative fuel under the Alternative Fuel Transportation Program. 
(These questions are posed in the context of the FTD discussion paper. 
It is recommended that interested parties intending to submit comments 
or participate in the workshop read the FTD discussion paper at the 
website address http://www.ott.doe.gov/epact/fuel_pet.shtml to better 
understand the questions below:)
    1. How should DOE define natural gas-based diesel fuels, and 
particularly FTD fuels, if designation is ultimately limited to that 
process?
    2. DOE requests comments on analysis provided by the Argonne 
National Laboratory (ANL) and the National Renewable Energy Laboratory 
(NREL), which will be used for making a determination regarding 
designation of FTD fuels. DOE also requests that interested parties 
submit any additional emissions data not cited in the NREL report.
    3. Should DOE set process energy use limits in its EPAct 
designation process to ensure that qualifying FTD fuels provide 
substantial energy security benefits? If so, which levels are 
appropriate?
    4. How should DOE balance its determinations about designating 
fuels if the fuels provide substantial benefits in some areas with 
regard to section 301(2) criteria, while being a slight detriment to 
others (e.g., positive attributes regarding criteria pollutants versus 
a slight increase in greenhouse gas emissions)? Is such an approach 
desirable?
    5. DOE requests comments on findings in NREL's report about 
NOX emissions benefits of 6-20 percent (compared to post-
2006 diesel fuels) related to control of fuel aromatic content and 
cetane number. Should these benefits be considered ``substantial'' with 
regard to section 301(2) criteria?
    6. DOE is seeking additional data on actual test and control fuels 
for FTD when used in later-model diesel engines to gauge how fuel 
composition affects emissions from these engines.
    7. What parameters should be set for aromatics, cetane, sulfur, and 
other standards to assure emissions reductions based on NREL's findings 
or other sources of information? Also, will FTD fuels in the lower end 
of the aromatics range result in materials compatibility problems and 
should polyaromatic content be included in addition to, or in lieu of, 
a limit on total aromatics? Should paraffin content be used to assure 
emissions reductions, and if so, do both normal- and iso-paraffin 
content need to be specified?

[[Page 57349]]

    8. There are various ways DOE might designate fuels with relation 
to greenhouse gas (GHG) emissions. The discussion paper located at the 
website address listed above suggests three such ways to view this 
question. DOE requests comments on which option would be most 
appropriate, and what levels of GHG emissions should be set if a 
particular option is chosen.
    9. DOE seeks any information and data collected about toxicity 
issues and ecotoxicity/biodegradability issues related to FTD.
    10. DOE requests comments on limiting oxygenated compounds in FTD 
fuels or suggestions on alternative approaches. Possibilities are 
outlined in the discussion paper.
    11. Are any of FTD fuels' characteristics sufficiently unique to 
justify inclusion of specific additives to assure that inherent 
environmental benefits are not degraded or negated due to negative 
impacts on engine components or emission control systems?
    12. Are there other issues that DOE should consider related to 
Fischer-Tropsch diesel fuel production and use relative to its possible 
designation as an alternative fuel?

VI. Public Comment

A. Written Comment Procedures

    The Department invites interested persons to participate in DOE's 
technical review of FTD fuels by submitting data, comments, or 
information with respect to the proposed issues set forth in the FTD 
discussion paper and subsequent workshop to Linda Bluestein, at the 
address indicated at the beginning of this notice. We will consider all 
submissions received by the date specified at the beginning of this 
notice.
    Pursuant to the provisions of 10 CFR 1004.11, anyone submitting 
information or data that he or she believes to be confidential and 
exempt by law from public disclosure should submit one complete copy of 
the document, as well as two copies, if possible, from which the 
information has been deleted. The DOE will make its determination as to 
the confidentiality of the information and treat it accordingly.

B. Public Workshop

1. Attendance at Workshop
    You will find the time and place of the public workshop listed at 
the beginning of this notice. If you would like to attend the public 
workshop, please notify Linda Bluestein at (202) 586-9171. Please note 
that foreign nationals visiting DOE Headquarters are subject to advance 
security screening procedures. If you are a foreign national and wish 
to participate in the workshop, please inform DOE of this fact as soon 
as possible by contacting Linda Bluestein at (202) 586-9171 so that the 
necessary procedures can be completed.
2. Procedures for Submitting Requests to Speak
    The Department invites any person who has an interest in FTD fuels, 
or who is a representative of a group or class of persons that has an 
interest in these issues, to make a request for an opportunity to make 
an oral presentation. The person making the request should state why he 
or she, either individually or as a representative of a group or class 
of persons, is an appropriate spokesperson. Please also briefly 
describe the nature of the interest in the rulemaking and provide a 
telephone number and e-mail address for contact. You may hand-deliver 
speaking requests to the address indicated at the beginning of this 
notice between the hours of 8 a.m. and 4 p.m., Monday through Friday, 
except Federal holidays. You may also send requests by mail or e-mail 
to [email protected].
    The Department requests that each person wishing to speak submit an 
advance copy of his or her statement no later than 4 p.m., October 1, 
2002. DOE requests that a copy of your statement also be e-mailed by 
October 8, 2002. The Department, at its discretion, may permit any 
person wishing to speak who cannot meet this requirement to participate 
if that person has made alternative arrangements with the Office of 
FreedomCAR and Vehicle Technologies in advance. The letter making a 
request to give an oral presentation must ask for such alternative 
arrangements. DOE's panel will read statements in advance of the 
hearing. Speakers should limit their oral presentations to 10 minutes 
and should specifically address DOE's technical questions (in this 
notice and the discussion paper) and other issues included in the 
rulemaking discussion paper.
3. Conduct of Workshop
    The workshop will be conducted in an informal, conference style. 
The Department may use a professional facilitator to facilitate 
discussion, and a court reporter will be present to record the 
transcript of the meeting. We will present at the workshop information 
about DOE's review process, technical analyses to date, and summaries 
of comments received before the workshop. DOE will also allow time for 
presentations by workshop participants, and encourage all interested 
parties to share their views on issues affecting DOE's potential 
determination to designate the candidate fuel. Attendees will have an 
opportunity to ask questions. Following the workshop, interested 
parties will have an opportunity to comment on the proceedings at the 
workshop and the FTD discussion paper. All comments must be received by 
November 15, 2002.
    The Department will make the entire record of this notice available 
on the website at http://www.ott.doe.gov/epact/fuel_pet.shtml. The 
transcript will be available for inspection at DOE's Headquarters in 
Washington, DC. Inspection of the transcript may be arranged by 
contacting Linda Bluestein at (202) 586-9171.

    Issued in Washington, DC, on September 4, 2002.
David K. Garman,
Assistant Secretary, Energy Efficiency and Renewable Energy.
[FR Doc. 02-22908 Filed 9-9-02; 8:45 am]
BILLING CODE 6450-01-P