[Federal Register Volume 75, Number 142 (Monday, July 26, 2010)]
[Notices]
[Pages 43522-43526]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-18227]


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ENVIRONMENTAL PROTECTION AGENCY

[EPA-HQ-OAR-2010-0133; FRL-9178-3]


Notice of Supplemental Determination for Renewable Fuels Produced 
Under the Final RFS2 Program From Canola Oil

AGENCY: Environmental Protection Agency (EPA).

ACTION: Notice of Data Availability (NODA).

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SUMMARY: On March 26, 2010, the Environmental Protection Agency 
published changes to the Renewable Fuel Standard (RFS) program as 
required by the Energy Independence and Security Act (EISA) of 2007. 
EISA increased the volume of renewable fuel required to be blended into 
transportation fuel to 36 billion gallons by 2022. Furthermore, the Act 
established new eligibility requirements for four types of renewable 
fuel, each with their own annual volume mandates. The eligibility 
requirements include minimum lifecycle greenhouse gas (GHG) reduction 
thresholds for each type of renewable fuel. EPA conducted lifecycle GHG 
analyses for a number of biofuel feedstocks and production pathways as 
part of its March 26, 2010 final rule but, as indicated in the final 
rule, we did not have time to complete all the planned lifecycle GHG 
assessments for several specific renewable fuel pathways. Since the 
final rule, we have completed an assessment for an additional renewable 
fuel pathway, canola oil biodiesel. This Notice of Data Availability 
provides interested parties with information and an opportunity to 
comment on our proposed lifecycle analysis of canola oil biodiesel.

DATES: Comments must be received on or before August 25, 2010.

ADDRESSES: Submit your comments, identified by Docket ID No. EPA-HQ-
OAR-2010-0133, by one of the following methods:
     http://www.regulations.gov: Follow the on-line 
instructions for submitting comments.
     E-mail: [email protected].
     Mail: Air and Radiation Docket and Information Center, 
Environmental Protection Agency, Mailcode: 2822T,

[[Page 43523]]

1200 Pennsylvania Ave., NW., Washington, DC 20460.
     Hand Delivery: Air and Radiation Docket and Information 
Center, EPA/DC, EPA West, Room 3334, 1301 Constitution Ave., NW., 
Washington DC 20004. Such deliveries are only accepted during the 
Docket's normal hours of operation, and special arrangements should be 
made for deliveries of boxed information.
    Instructions: Direct your comments to Docket ID No. EPA-HQ-OAR-
2010-0133. EPA's policy is that all comments received will be included 
in the public docket without change and may be made available online at 
http://www.regulations.gov, including any personal information 
provided, unless the comment includes information claimed to be 
Confidential Business Information (CBI) or other information whose 
disclosure is restricted by statute. Do not submit information that you 
consider to be CBI or otherwise protected through http://www.regulations.gov or [email protected]. The http://www.regulations.gov 
Web site is an ``anonymous access'' system, which means EPA will not 
know your identity or contact information unless you provide it in the 
body of your comment. If you send an e-mail comment directly to EPA 
without going through http://www.regulations.gov your e-mail address 
will be automatically captured and included as part of the comment that 
is placed in the public docket and made available on the Internet. If 
you submit an electronic comment, EPA recommends that you include your 
name and other contact information in the body of your comment and with 
any disk or CD-ROM you submit. If EPA cannot read your comment due to 
technical difficulties and cannot contact you for clarification, EPA 
may not be able to consider your comment. Electronic files should avoid 
the use of special characters, any form of encryption, and be free of 
any defects or viruses. For additional information about EPA's public 
docket visit the EPA Docket Center homepage at http://www.epa.gov/epahome/dockets.htm.
     Docket: All documents in the docket are listed in the 
http://www.regulations.gov index. Although listed in the index, some 
information is not publicly available, e.g., CBI or other information 
whose disclosure is restricted by statute. Certain other material, such 
as copyrighted material, will be publicly available only in hard copy. 
Publicly available docket materials are available either electronically 
in http://www.regulations.gov or in hard copy at the Air and Radiation 
Docket and Information Center, EPA/DC, EPA West, Room 3334, 1301 
Constitution Ave., NW., Washington, DC 20004. The Public Reading Room 
is open from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding 
legal holidays. The telephone number for the Public Reading Room is 
(202) 566-1744, and the telephone number for the Air Docket is (202) 
566-1742.

FOR FURTHER INFORMATION CONTACT: Doris Wu, Office of Transportation and 
Air Quality, Transportation and Climate Division, Environmental 
Protection Agency, 2000 Traverwood Drive, Ann Arbor, MI 48105; 
telephone number: 734-214-4923; fax number: 734-214-4958; e-mail 
address: [email protected].

SUPPLEMENTARY INFORMATION:

I. General Information

A. Does this action apply to me?

    Entities potentially affected by this action are those involved 
with the production, distribution, and sale of transportation fuels, 
including gasoline and diesel fuel or renewable fuels such as ethanol 
and biodiesel. Regulated categories include:
    This table is not intended to be exhaustive, but rather provides a 
guide for readers regarding entities likely to be regulated by the RFS2 
program. This table lists the types of entities that EPA is now aware 
of that could potentially be regulated under the program. To determine 
whether your activities would be regulated, you should carefully 
examine the applicability criteria in 40 CFR part 80, Subpart M. If you 
have any questions regarding the applicability of this action to a 
particular entity, consult the person listed in the preceding section.

B. What should I consider as I prepare my comments for EPA?

    1. Submitting CBI. Do not submit this information to EPA through 
http://www.regulations.gov or e-mail. Clearly mark the part or all of 
the information that you claim to be CBI. For CBI information in a disk 
or CD ROM that you mail to EPA, mark the outside of the disk or CD ROM 
as CBI and then identify electronically within the disk or CD ROM the 
specific information that is claimed as CBI. In addition to one 
complete version of the comment that includes information claimed as 
CBI, a copy of the comment that does not contain the information 
claimed as CBI must be submitted for inclusion in the public docket. 
Information so marked will not be disclosed except in accordance with 
procedures set forth in 40 CFR part 2.
    2. Tips for Preparing Your Comments. When submitting comments, 
remember to:
     Identify the rulemaking by docket number and other 
identifying information (subject heading, Federal Register date and 
page number).
     Follow directions--The agency may ask you to respond to 
specific questions or organize comments by referencing a Code of 
Federal Regulations (CFR) part or section number.
     Explain why you agree or disagree; suggest alternatives 
and substitute language for your requested changes.
     Describe any assumptions and provide any technical 
information and/or data that you used.
     If you estimate potential costs or burdens, explain how 
you arrived at your estimate in sufficient detail to allow for it to be 
reproduced.
     Provide specific examples to illustrate your concerns, and 
suggest alternatives.
     Explain your views as clearly as possible, avoiding the 
use of profanity or personal threats.
     Make sure to submit your comments by the comment period 
deadline identified.

II. Background on Lifecycle GHG Threshold Determinations

A. Methodology

1. Scope of Analysis
    On March 26, 2010, the Environmental Protection Agency (EPA) 
published changes to the Renewable Fuel Standard program as required by 
the Energy Independence and Security Act (EISA) of 2007. This 
rulemaking is commonly referred to as the ``RFS2'' final rule. As part 
of the RFS2 final rule we analyzed various categories of biofuels to 
determine if the complete lifecycle emissions associated with the 
production, distribution, and use of those fuels met minimum lifecycle 
greenhouse gas reduction thresholds as specified by EISA (i.e., 60% for 
cellulosic biofuel, 50% for biomass-based diesel and advanced biofuel, 
and 20% for other renewable fuels). Our final rule had focused our 
lifecycle analyses on fuels that were anticipated to contribute 
relatively large volumes of renewable fuel by 2022, and thus did not 
cover all fuels that either are contributing or could potentially 
contribute to the program. In the final RFS2 rule we indicated that we 
did not have enough time to complete a lifecycle analysis for several 
specific pathways but would do so this year as a supplemental to the 
final rule. Since the final rule was issued, we have continued to 
examine several additional

[[Page 43524]]

pathways not analyzed for the final rule released in March. This Notice 
of Data Availability (``NODA'') focuses on our recent modeling of the 
canola oil biodiesel pathway. The modeling approach EPA used in this 
effort is the same approach used in the final RFS2 rule for lifecycle 
analyses of other biofuels. Refer to the RFS2 final rule preamble and 
Regulatory Impact Analysis (RIA) for further discussion on our 
approach.
2. Models Used
    The proposed analysis EPA has prepared for canola oil biodiesel 
uses the same set of models that was used for the final RFS2 rule: the 
Forestry and Agricultural Sector Optimization Model (FASOM) developed 
by Texas A&M University and others and the Food and Agricultural Policy 
and Research Institute international models as maintained by the Center 
for Agricultural and Rural Development (FAPRI-CARD) at Iowa State 
University. For details on the models used refer to the RFS2 final rule 
preamble or Regulatory Impact Analysis. These documents are available 
in the docket or online at http://www.epa.gov/otaq/fuels/renewablefuels/regulations.htm. The models require a number of inputs 
that are specific to the pathway being analyzed, including projected 
yield of feedstock per acre planted, projected fertilizer use, energy 
use in feedstock processing and energy use in fuel production. The 
docket includes detailed information on model inputs, assumptions, 
calculations, and the results of our proposed modeling for canola oil 
biodiesel.
3. Scenarios Modeled
    To assess the impacts of an increase in renewable fuel volume from 
business-as-usual (what is likely to have occurred without EISA), we 
established reference and control cases for the RFS2 final rulemaking 
published in March 2010. The reference cases are projections of 
renewable fuel volumes without the enactment of EISA. The control cases 
are projections of the volumes of renewable fuel that might be used in 
the future to comply with the EISA volume mandates. The final rule 
reference case volumes were based on the Energy Information 
Administration's (EIA) Annual Energy Outlook (AEO) 2007 reference case 
projections. Our control case volumes were based on our projections of 
a feasible set of fuel types and feedstocks. Although actual volumes 
could be different, we believe the projections made for our control 
cases allow for a reasonable assessment of the potential GHG impacts 
per gallon of fuel for volumes of renewable fuel likely resulting from 
implementation of the RFS2 program.
    For a number of fuel pathways such as ethanol from corn starch or 
biodiesel from soybean oil our reference case projected the business as 
usual volumes from EIA projections for that pathway which we were then 
able to compare to the control case volumes estimated to increase due 
to the EISA mandates. This incremental volume increase in renewable 
fuel volume was used to calculate lifecycle emissions per gallon or 
million British Thermal Units (mmBTU) of renewable fuel. Since our 
analysis normalizes the greenhouse gas emissions impacts on a per BTU 
basis, the effect of using different incremental volumes in our 
calculations is minimized.
    We based our control case projection of 200 million gallons of 
biodiesel from canola per year in 2022 on a few factors, including 
historical volumes, potential feedstock availability and competitive 
uses (e.g., for food or export instead of for domestic fuel), potential 
increases in crop acreage, and potential increases in crop and 
conversion yields. Our assessment is described further in the inputs 
and assumptions document that is available through the docket. Based in 
part on consultation with experts at the United States Department of 
Agriculture (USDA) and industry representatives, we believe that these 
volumes are realistic for the purpose of evaluating the impacts of 
producing biodiesel from canola oil. For biodiesel from canola oil, we 
do not have reference case predictions of business as usual volumes 
from EIA like we did for other fuels. We modeled the impact of an 
increase of 200 million gallons of biodiesel from canola per year by 
2022 compared to the final RFS2 control case (from the March 2010 
analysis) which assumed no biodiesel from canola oil. While we 
recognize that some canola oil has historically been used to make 
biodiesel for domestic use, this range of production (zero to 200 
million gallons) covers the range of production likely by 2022. We 
believe that this modeled change in canola oil production for biodiesel 
provides an assessment of lifecycle GHG emissions per gallon of canola 
biodiesel which reasonably represents the per gallon impact over the 
likely range of canola biodiesel volumes expected through 2022.

B. Results of Lifecycle Analysis for Biodiesel From Canola Oil

    As with other EPA analyses of fuel pathways with a significant land 
use impact, the proposed analysis for canola oil biodiesel includes a 
best estimate as well as a range of possible lifecycle greenhouse gas 
emission results based on formal uncertainty analysis conducted by the 
Agency.
    EPA believes that its analysis of canola oil biodiesel represents 
the most up to date information currently available on the GHG 
emissions associated with each element of the full fuel lifecycle. 
Notably the analysis includes an assessment of uncertainty for key 
parameters. The graph included in the discussion below depicts the 
results of our analysis (including the uncertainty in the modeling) for 
a typical pathway for canola oil biodiesel.
    We analyzed the lifecycle GHG emission impacts of producing 
biodiesel using canola oil as a feedstock assuming the same biodiesel 
production facility designs and conversion efficiencies as modeled for 
biodiesel produced from soybean oil. Canola oil biodiesel is produced 
using the same methods as soybean oil biodiesel, therefore plant 
designs are assumed to not significantly differ between these two 
feedstocks. Refer to the docket for more details on our key model 
inputs and assumptions, e.g., crop yields, biofuel conversion yields, 
and agricultural energy use. These inputs and assumptions are based on 
our analysis of peer-reviewed literature and reflect our consideration 
of recommendations of experts within the canola and biodiesel 
industries and those from USDA as well as the experts at Texas A&M and 
Iowa State Universities who have designed the FASOM and FAPRI models.
    As was the case for soybean oil biodiesel, production technology 
for canola oil biodiesel is mature and we have not projected in our 
assessment of canola oil biodiesel any significant improvements in 
plant technology; unanticipated energy saving improvements would 
further improve GHG performance of the fuel pathway. Additionally, 
similar to soybean oil biodiesel production, we assumed that the co-
product glycerin would displace residual oil as a fuel source on an 
energy equivalent basis. This is based on the assumption that the 
glycerin market would be saturated in 2022 and that glycerin produced 
from biodiesel would not displace any additional petroleum glycerin 
production. However, the biodiesel glycerin would not be a waste and a 
low value use would be to use the glycerin as a fuel source. The fuel 
source assumed to be replaced by the glycerin is residual oil.
    Figure II-1 shows the results of our proposed modeling. It shows 
the percent difference between lifecycle GHG emissions for the typical 
2022 canola oil biodiesel as compared to the

[[Page 43525]]

petroleum diesel fuel 2005 baseline. Lifecycle GHG emissions equivalent 
to the diesel fuel baseline are represented on the graph by the zero on 
the X-axis. The results for canola biodiesel are that the midpoint of 
the range of results is a 50% reduction in GHG emissions compared to 
the diesel fuel baseline. The 95% confidence interval around that 
midpoint results in range of a 20% reduction to a 75% reduction 
compared to the diesel fuel 2005 baseline. These results, if finalized, 
would justify authorizing the generation of biomass-based diesel RINs 
for fuel produced by the canola oil biodiesel pathway modeled, assuming 
that the fuel meets the other definitional criteria for renewable fuel 
(e.g., produced from renewable biomass, and used to reduce or replace 
transportation fuel) specified in EISA.
    The material in the docket includes detailed information on the 
assumptions and modeling inputs used. As was the case for analyses of 
other crop-based biofuels, EPA projected increases in canola crop yield 
based on long term trends. Yield improvement rates recommended by 
industry were higher and were based on recent shorter term trends. 
While we have not modeled what specific impact a higher crop yield 
assumption would have on the resulting lifecycle GHG assessment, higher 
projected yields would tend to reduce land use impacts which could 
result in some improvement in projected GHG performance of canola 
biodiesel. EPA invites comment on all aspects of its proposed modeling 
of the canola oil biodiesel pathway, including all assumptions made and 
modeling inputs.
    Table II-1 breaks down by stage the lifecycle GHG emissions for 
canola oil biodiesel and the 2005 diesel baseline. The biodiesel 
production process reflected in this table assumes that natural gas is 
used for process energy and accounts for co-product glycerin displacing 
residual oil. This table demonstrates the contribution of each stage 
and its relative significance. The docket also includes pathway 
analyses assuming coal or biomass is used instead of natural gas for 
process energy.
[GRAPHIC] [TIFF OMITTED] TN26JY10.081


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   Table II-1--Lifecycle GHG Emissions for Canola Oil Biodiesel, 2022
                             [kgCO2e/mmBTU]
------------------------------------------------------------------------
                                         Canola oil        2005 Diesel
              Fuel type                   biodiesel         baseline
------------------------------------------------------------------------
Net Domestic Agriculture (w/o land                   8
 use change)........................
Net International Agriculture (w/o                   0
 land use change)...................
Domestic Land Use Change............                 3
International Land Use Change, Mean          31 (7/61)
 (Low/High).........................
Fuel Production.....................                 3                18
Fuel and Feedstock Transport........                 2                 *
Tailpipe Emissions..................                 1                79
                                     -----------------------------------
    Total Emissions, Mean (Low/High)        48 (25/78)                97
------------------------------------------------------------------------
* Emissions included in fuel production stage.

    Refer to the docket for more detailed outputs from our proposed 
lifecycle modeling. The docket includes a useful memorandum which 
summarizes relevant materials used for the canola biodiesel pathways 
analysis. Described in the memorandum, for example, are the input and 
assumptions document and detailed results spreadsheets (e.g., foreign 
agricultural impacts, foreign agricultural energy use, FASOM and FAPRI 
model results) used to generate the results presented above. These 
additional materials are also available through the docket.

    Dated: July 13, 2010.
Margo T. Oge,
Director, Office of Transportation & Air Quality.
 [FR Doc. 2010-18227 Filed 7-23-10; 8:45 am]
BILLING CODE 6560-50-P