[Federal Register Volume 76, Number 142 (Monday, July 25, 2011)]
[Rules and Regulations]
[Pages 44406-44450]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-16459]
[[Page 44405]]
Vol. 76
Monday,
No. 142
July 25, 2011
Part II
Environmental Protection Agency
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40 CFR Part 80
Regulation To Mitigate the Misfueling of Vehicles and Engines With
Gasoline Containing Greater Than Ten Volume Percent Ethanol and
Modifications to the Reformulated and Conventional Gasoline Programs;
Final Rule
Federal Register / Vol. 76 , No. 142 / Monday, July 25, 2011 / Rules
and Regulations
[[Page 44406]]
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ENVIRONMENTAL PROTECTION AGENCY
40 CFR Part 80
[EPA-HQ-OAR-2010-0448; FRL-9428-2]
RIN 2060-AQ17
Regulation To Mitigate the Misfueling of Vehicles and Engines
With Gasoline Containing Greater Than Ten Volume Percent Ethanol and
Modifications to the Reformulated and Conventional Gasoline Programs
AGENCY: Environmental Protection Agency (EPA).
ACTION: Final rule.
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SUMMARY: In two recent actions under the Clean Air Act (CAA), EPA
granted partial waivers that allow gasoline containing greater than 10
volume percent (vol%) ethanol up to 15 vol% ethanol (E15) to be
introduced into commerce for use in model year (MY) 2001 and newer
light-duty motor vehicles, subject to certain conditions. In today's
action, EPA is establishing several measures to mitigate misfueling of
other vehicles, engines and equipment with E15 and the potential
emissions consequences of misfueling. Specifically, the rule prohibits
the use of gasoline containing more than 10 vol% ethanol in vehicles,
engines and equipment not covered by the partial waiver decisions. The
final rule also requires all E15 gasoline fuel dispensers to have a
specific label when a retail station or wholesale-purchaser consumer
chooses to sell E15. In addition, the rule requires that product
transfer documents (PTDs) specifying ethanol content and Reid Vapor
Pressure (RVP) accompany the transfer of gasoline blended with ethanol
through the fuel distribution system, and a survey of retail stations
to ensure compliance with E15 labeling, ethanol content and other
requirements. The rule also modifies the Reformulated Gasoline (RFG)
program to allow fuel manufacturers to certify batches of E15. Finally,
today's action denies a petition for rulemaking to require retail
stations to offer for sale gasoline containing 10 vol% ethanol or less.
DATES: This final rule is effective on August 24, 2011.
ADDRESSES: EPA has established a docket for this action under Docket ID
No. EPA-HQ-OAR-2010-0448. All documents in the docket are listed on the
http://www.regulations.gov Web site. 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, is not placed on the Internet and will be
publicly available only in hard copy form. Publicly available docket
materials are available either electronically through 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. 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: Robert K. Anderson, Office of
Transportation and Air Quality, Compliance and Innovative Strategies
Division, Environmental Protection Agency, 1310 L St., NW., Washington,
DC; telephone number: 202-343-9718; fax number: 202-343-2800; e-mail
address: [email protected].
SUPPLEMENTARY INFORMATION:
Does this action apply to me?
Entities potentially affected by this action include those involved
with the production, importation, distribution, marketing, or retailing
of diesel fuel and production of gasoline. Categories and entities
affected by this action include:
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Examples of potentially regulated
Category NAICS 1 Codes SIC 2 Codes entities
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Industry................................... 324110 2911 Petroleum Refineries.
Industry................................... 325193 2869 Ethyl alcohol manufacturing.
Industry................................... 424710 5171 Petroleum bulk stations and
terminals.
Industry................................... 424720 5172 Petroleum and petroleum products
merchant wholesalers.
.............. .............. Other fuel dealers.
Industry................................... 454319 5989 Gasoline service stations.
Industry................................... 447190 5541 Marine service stations.
.............. .............. Truck stops.
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This table is not intended to be exhaustive, but rather provides a
guide for readers regarding entities likely to be affected by this
action; however, other types of entities not listed in the table could
also be affected. To determine whether your entity is affected by this
action, you should examine the applicability criteria of parts 79 and
80 of title 40 of the Code of Federal Regulations. If you have any
question regarding applicability of this action to a particular entity,
consult the person in the preceding FOR FURTHER INFORMATION CONTACT
section.
Outline of This Preamble
I. Executive Summary
A. Proposed Rule
B. Final Mitigation Measures
C. Other Mitigation Measures
D. Emissions Impacts of the Rule
E. Related Regulatory Changes
F. Liability Issues
G. Petition for Rulemaking To Require the Continued Availability
of E10 and/or E0
II. Background
A. Statutory Authority
B. E15 Partial Waivers
C. The Proposed Misfueling Mitigation Measures Rule
D. Reasons for the Actions in This Rulemaking
III. Misfueling Mitigation Program
A. Misfueling Prohibition
B. Fuel Pump Labeling Requirements
1. Proposed Approach
2. Consideration of Comments
a. Choice of Word for Warning Component
b. Description of Motor Vehicles That Can Use E15
c. Statements About Prohibition and Damage
d. Addressing Non-English Speakers
e. Portable Fuel Containers
f. Color, Size, Shape, Font, and Placement of the Label
g. Separate Labels for Different Levels of Ethanol
3. Final Fuel Pump Labeling Requirements
C. PTD Requirements
1. PTD Requirements Downstream of the Point of Ethanol Addition
2. PTD Requirements Up to and Including the Point of Ethanol
Addition
3. General PTD Requirements
D. Ongoing Implementation Survey
1. Proposed Approaches and Consideration of Comments
a. General Survey Comments
b. Survey Option 1
c. Survey Option 2
2. Final Survey Requirements
[[Page 44407]]
E. Program Outreach
F. Other Misfueling Mitigation Measures
1. Need for More Mitigation Measures
2. Specific Suggestions for Additional Mitigation Measures
a. Distinctive Hand Warmers for E15 Dispensers
b. Keypad/Touch Screen Information/Confirmation
c. Radio Frequency Identification (RFID)
d. Requiring the Continued Availability of E10 and/or E0
G. Modification of the Complex Model Regulations and VOC
Adjustment Rule
1. Proposed Approach and Consideration of Comments
a. VOC Emissions from Permeation
b. Representation of NOX and Toxic Emissions in the
Complex Model
c. Adequacy of the Guerreri/Caffrey Study to Justify
Modification of the Complex Model Regulations
d. Representation of Other Renewable Fuels and Fuel Additives in
the Complex Model
e. Modification of the VOC Adjustment for RFG in Chicago and
Milwaukee
2. Final Approach Concerning the Complex Model and the VOC
Adjustment Rule
H. Federalism Issues
IV. Other Issues Addressed by Commenters
A. Cost of Compliance
B. The Applicability of the Statutory 1.0 psi RVP Waiver to E15
C. RVP and E15 Underground Storage Tank Transition
D. Credit for RFG Downstream Oxygenate Blending
E. Compliance, Enforcement and Warranty
1. Proposed Approach
2. Consideration of Comments
a. Prohibited Acts and Liability Provisions
b. Emissions Warranty Issues for Vehicles, Engines, and
Equipment
c. Other Issues Outside of CAA Jurisdiction
3. Final Requirements
F. Technical Basis for the Rule
G. The Effect of the Rule on the Misfueling Mitigation
Conditions of the Partial Waivers
H. E15 Emissions and Anti-Backsliding
V. Statutory and Executive Order Reviews
A. Executive Order 12866: Regulatory Planning and Review and
Executive Order 13563: Improving Regulation and Regulatory Review
B. Paperwork Reduction Act
C. Regulatory Flexibility Act
D. Unfunded Mandates Reform Act
E. Executive Order 13132 (Federalism)
F. Executive Order 13175
G. Executive Order 13045: Protection of Children from
Environmental Health Risks and Safety Risks
H. Executive Order 13211: Actions Concerning Regulations That
Significantly Affect Energy Supply, Distribution, or Use
I. National Technology Transfer and Advancement Act
J. Executive Order 12898: Federal Actions To Address
Environmental Justice in Minority Populations and Low-Income
Populations
K. Congressional Review Act
VI. Legal Authority and Judicial Review
A. Legal Authority
B. Judicial Review
I. Executive Summary
In today's final rule, EPA is establishing several measures to
mitigate the potential for E15 \1\ to be used to fuel vehicles, engines
and equipment for which E15 has not been approved for introduction into
commerce. These regulations are being issued in conjunction with EPA's
two recent decisions to grant partial waivers for E15 under section
211(f)(4) of the Clean Air Act (CAA or the Act). The partial waivers
allow the introduction into commerce of E15 for use in model year (MY)
2001 and newer light-duty motor vehicles (cars, light-duty trucks and
medium-duty passenger vehicles). The E15 partial waivers impose a
number of conditions designed to help ensure that E15 is introduced
into commerce for use only in MY2001 and newer light-duty motor
vehicles and in flexible-fueled vehicles, and not for use in any other
vehicles, engines or equipment. Some of the regulatory provisions in
this action parallel those waiver conditions and are expected to be a
more efficient way to minimize in-use emission increases that might
result from misfueling with E15. The misfueling mitigation measures
adopted today ensure that fuel providers have a strong incentive to
properly blend and label E15 and consumers have a strong incentive to
avoid misfueling. By effectively addressing the potential for
misfueling, the measures should also have the benefit of facilitating
the successful introduction of E15 into commerce.
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\1\ For purposes of this preamble, E15 refers to gasoline-
ethanol blended fuels that contain greater than 10 vol% and no more
than 15 vol% ethanol content.
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A. Proposed Rule
EPA proposed four regulatory provisions to address concerns about
potential misfueling: (1) A prohibition against the use of gasoline
containing more than 10 vol% ethanol in vehicles, engines and equipment
not covered by the partial waiver decisions, specifically MY2000 and
older motor vehicles, heavy-duty gasoline engines and vehicles, on and
off-highway motorcycles,\2\ and nonroad engines, vehicles, and
equipment; \3\ (2) labeling requirements for fuel pumps that dispense
E15 to alert consumers to the appropriate and lawful use of the fuel;
(3) the addition to PTDs of information regarding the ethanol content
of, or the level of ethanol that may be added to, gasoline being sold
to retail stations or wholesale purchaser-consumers so that E15 may be
properly blended and labeled; and (4) an ongoing implementation survey
requirement to ensure that E15 is in fact being properly blended and
labeled (75 FR 68044, Nov. 4, 2010). EPA explained that it has used
such strategies to implement several fuels programs over the past 30
years, and that the proposed measures should effectively mitigate
misfueling and the associated emissions impacts while enabling the use
of E15 in appropriate motor vehicles. The E15 misfueling mitigation
waiver conditions and a substantial consumer education and outreach
effort are also directed at achieving this result. The Agency asked for
comment on its proposed requirements and on several other options,
including whether additional misfueling mitigation measures might be
appropriate.
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\2\ Off-highway motorcycles are considered nonroad vehicles but
for purposes of this preamble on and off-highway motorcycles are
referred to collectively as ``motorcycles.''
\3\ For purposes of this preamble, nonroad engines, vehicles,
and equipment are referred to as ``nonroad products.''
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EPA received over 80 comments from fuel providers, manufacturers of
vehicles, engines and gasoline-powered equipment, boat owners, States,
and environmental groups. While a number of comments raised continuing
concerns with EPA's decision to grant the partial waivers, all
acknowledged the importance of an effective misfueling mitigation
program and provided thoughtful suggestions about how the Agency's
proposed regulations might be improved or supplemented.
B. Final Mitigation Measures
After carefully considering the public comments, we are finalizing
the four proposed misfueling mitigation measures with a number of
changes designed to enhance their effectiveness and more carefully
tailor them to their purpose. Specifically, we are adopting the
prohibition on misfueling. The comments we received were generally
supportive of the prohibition in view of EPA's decision to deny the E15
waiver request for MY2000 and older light-duty motor vehicles, heavy-
duty gasoline engines and vehicles, motorcycles and nonroad products
because of the emissions increases that could result if E15 (or higher
gasoline-ethanol blends) were used, particularly over time, in those
vehicles, engines and products. With adoption of the misfueling
prohibition, gasoline and ethanol producers, distributors, retailers
and consumers have a legal obligation not to make, distribute, sell or
use gasoline containing more than 10 vol% ethanol for or in vehicles,
engines and
[[Page 44408]]
equipment not covered by the partial waiver decisions.
To provide consumers with information at the pump to avoid
misfueling, we are adopting an E15 pump label that reflects many
commenters' suggestions and our consultation with consumer labeling
experts at the Federal Trade Commission (FTC).\4\ Before EPA issued its
partial waiver decisions, FTC had proposed labels for gasoline-ethanol
blends containing more than 10 vol% ethanol to address issues within
its jurisdiction. Commenters on our proposed E15 label urged us to work
with FTC to develop a coordinated labeling program to avoid multiple,
potentially conflicting labels. Commenters also recommended that we
seek advice from labeling experts. In developing today's final labeling
requirements, we consulted with FTC consumer labeling experts and other
staff about effective label design and potential coordination with FTC
labels.
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\4\ The FTC has experience designing labels to help consumers
make informed decisions at the point-of-sale. See, e.g., 16 CFR part
305 (EnergyGuide and Light Bulb labels); 16 CFR parts 306 and 309
(Automotive Fuel labels); and 16 CFR part 423 (Clothing Care
labels).
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EPA's final E15 label incorporates public and FTC staff suggestions
for more simply and effectively communicating the information consumers
need to avoid misfueling with E15. The label also adopts FTC's color
scheme for alternative fuel labels and other aspects of the design of
FTC's proposed gasoline-ethanol blend labels, such as size, shape, and
font, so that the two agencies' labels could work together as a
coordinated labeling scheme for gasoline-ethanol blends containing more
than 10 vol% ethanol. We believe that the final E15 label provides
consumers with the key information they need about the appropriate use
of E15.
Today's rule also includes PTD and implementation survey
requirements that have been revised and refined in response to public
comments to better accomplish their purpose. We are requiring that PTDs
provide more pertinent information, and we are providing more
flexibility in how that information is conveyed to help ensure that
fuel producers, distributors and retailers have the information they
need to properly blend, track and label E15. For surveys of whether E15
is being properly blended and labeled, we are providing options that
allow the businesses involved to match the geographic scope of an
ongoing survey to their business plans and to share the cost of surveys
among themselves as they see fit. We are also requiring that surveys
collect RVP information for fuel samples labeled as E15 to help ensure
implementation of the waiver condition that E15 be limited to 9.0 psi
RVP in the summertime. In the aggregate, these measures will provide
strong incentives for fuel providers to properly blend and label E15
and for consumers to avoid misfueling.
Relatedly, we are adopting our proposed interpretation that CAA
section 211(h)(4) provides a 1.0 psi RVP waiver and related compliance
provision only to gasoline-ethanol blended fuels containing between
nine and 10 vol% ethanol, in light of the terms and legislative history
of the relevant statutory provisions.
C. Other Mitigation Measures
EPA received a number of comments expressing concern that the
proposed misfueling mitigation measures would not adequately mitigate
misfueling. Several of the comments suggested that the Agency issue one
or more additional measures in this final rule, although only a few
commenters provided specific recommendations. A later section of this
notice reviews those comments and EPA's analysis of several other
measures. Overall, we concluded that the misfueling mitigation measures
required by today's rule should be effective, and that requiring
additional measures is not necessary or appropriate at this time.
As explained in the proposed rule, EPA drew on its experience with
the recent transition to ultra-low sulfur diesel (ULSD) fuel in
developing the E15 misfueling mitigation proposal. Several commenters
contended that the transition to unleaded gasoline that occurred
several decades ago provided more applicable lessons, including the
need for additional mitigation measures. After considering those
comments, and as fully discussed later in this notice, EPA continues to
believe that the misfueling mitigation measures adopted today are
reasonable, appropriate and sufficient to address E15 misfueling
concerns. We expect that the E15 label will provide consumers with the
key information they need to make appropriate fuel choices, and that
the prohibition against misfueling will provide additional incentives
for all parties to minimize misfueling. The PTD and survey requirements
will provide fuel blenders, distributors and retailers with the
information they need to properly blend, track and label E15 and
confirmation that E15 has been properly made and sold. In addition to
these required measures, retailers and other fuel providers may employ
any other strategies they believe would further reduce the risk of
misfueling under their particular circumstances. For example, retailers
that serve a significant population of boat or small equipment owners
can evaluate whether it is appropriate under their circumstances to
post signs that specifically address misfueling of those products. We
encourage consideration of additional measures as may be helpful in a
fuel provider's specific circumstances. By taking additional, tailored
steps, retailers and other fuel providers can provide examples of other
misfueling mitigation measures that may also be effective in reducing
the risk of misfueling.
In deciding what mitigation measures to require at this time, we
also considered what we do, and do not, know about the introduction of
E15 into the marketplace. The partial waivers that EPA has granted to
E15 do not require that E15 be made or sold. The waivers merely allow
fuel or fuel additive manufacturers to introduce E15 into commerce if
they meet the waivers' conditions. Other Federal, state and local
requirements must also be addressed before E15 may be sold. While EPA
is working to address issues within its jurisdiction, it is ultimately
up to businesses to decide whether, when and how to market E15. In
light of the various decisions that need to be made by various parties,
we expect that the transition to E15, like the transition to E10, will
occur over several years and begin in some parts of the country before
becoming broadly available. In the process, business decisions will be
made about how to market E15 (e.g., the price of E15 and its use for a
particular grade of gasoline).
As the transition to E15 occurs, we plan to work with industry,
state, environmental and consumer stakeholders to track developments
and evaluate the effectiveness of the mitigation measures required by
today's rule. We are already in the process of working with the ethanol
industry and other stakeholders to help establish a public education
and outreach campaign to assist fuel producers, distributors, retailers
and consumers in understanding how E15 may be made, distributed, sold
and used. Our recent experience with the transition to ULSD fuel shows
that a stakeholder-led campaign can work synergistically with labeling
requirements and provide another means of providing important
information to everyone involved in fuel production, distribution and
use. Establishing a similar campaign for E15 can also provide a forum
for identifying and resolving any issues that may
[[Page 44409]]
develop as E15 moves into the marketplace.
D. Emissions Impacts of the Rule
These misfueling mitigation regulations are issued under CAA
section 211(c) to mitigate and minimize the emission increases that
would occur if E15 (or a higher gasoline-ethanol blend) is used in
vehicles, engines, and products for which the E15 waiver was denied,
specifically, MY2000 and older motor vehicles and all heavy-duty
gasoline engines and vehicles, motorcycles and nonroad products. As
described below in Section IV.F and in the E15 partial waiver
decisions, our assessment of the potential emission consequences of E15
use indicates that the emission-related components of MY2001 and newer
light-duty motor vehicles are durable for use on gasoline-ethanol
blends up to E15. This conclusion is based on the results of the
Department of Energy (DOE) Catalyst Study and other relevant test
programs, as well as the Agency's engineering assessment of advances in
motor vehicle technology and materials that have taken place in
response to a series of important exhaust and evaporative emissions
requirements since 2000 and in-use experience with E10.
Unlike for MY2001 and newer motor vehicles, there is very little,
if any, test data with respect to the effect of E15 use in MY2000 and
older light-duty motor vehicles and all heavy-duty gasoline engines and
vehicles, motorcycles, and nonroad products. In addition, our
engineering assessment for these vehicles, engines, and products
identifies a number of emission-related concerns with the use of E15
(or a higher gasoline-ethanol blend). For motor vehicles, these
concerns include the potential for catalyst deterioration or catalyst
failure as well as material compatibility issues that could lead to
extremely elevated exhaust and evaporative emissions. For motorcycles
and nonroad products, the misfueling concerns include the potential for
elevated exhaust and evaporative emissions, as well as the potential
for emissions impacts related to engine failure from overheating. It is
not possible to precisely quantify the frequency at which these
vehicles, engines, and products might experience problems with the use
of E15. However, we believe that emission-related problems could
potentially occur with enough frequency that the avoided emissions
increases from reduced or prevented misfueling would more than outweigh
the relatively low cost imposed by the required misfueling mitigation
regulations. The potential emission increases from misfueling warrant
today's action, even if a very low percentage of vehicles, engines, and
products experience problems.
E. Related Regulatory Changes
In addition to misfueling mitigation measures, today's action also
finalizes slight modifications to the RFG and anti-dumping
(conventional) gasoline fuels programs to open the way for refiners and
importers to produce and certify gasoline containing up to 15 vol%
ethanol. For gasoline to be sold in the U.S., it must comply with the
RFG and anti-dumping standards. To comply with the RFG and anti-dumping
standards, the emissions performance of gasoline is calculated using a
model, called the Complex Model, which predicts the emissions of
regulated pollutants based on the measured values of certain fuel
properties. The equations in the model were limited to an oxygen
content of no more than 4.0% by weight in gasoline, which is the
maximum possible amount of oxygen in E10. EPA has modified the Complex
Model to allow fuel manufacturers to certify batches of E15 and made a
related change to certain volatile organic compound (VOC) standards, in
response to comments.
F. Liability Issues
In today's notice, EPA also addresses issues that many commenters
raised concerning liability or responsibility for potential
consequences of the use of, or transition to, E15. According to a
number of commenters, fuel providers are unlikely to sell E15 until
liability issues are resolved. EPA is not in a position to resolve all
of the liability issues raised by commenters, but we do address those
within our jurisdiction and clarify the responsibilities of various
parties, including fuel producers, distributors, retailers, product
manufacturers and consumers, for compliance with misfueling
prohibitions and vehicle and engine warranty and other requirements
under the Clean Air Act. In general, we believe the long-standing
approach of EPA's fuels programs and warranty regulations to assigning
respective responsibilities for compliance with our regulations is also
appropriate for E15. We believe that the required label and other
misfueling mitigation measures will minimize consumer use of E15 in
vehicles, engines and products not covered by the partial waivers and
any liability issues that might arise from or be attributed to
misfueling with E15. A public outreach campaign is expected to
reinforce the misfueling mitigation measures. Also, to the extent fuel
providers determine that it is appropriate to further reduce the risk
or potential of consumer misfueling, they may take additional
misfueling mitigation measures that they believe could be useful in
showing they did not encourage or otherwise cause the misfueling.
With regard to other transition issues within EPA's jurisdiction,
we are continuing to make progress in developing guidance for
determining whether existing underground storage tank systems are
compatible for storing E15. We also plan to work with stakeholders to
monitor and facilitate efforts to address other transition issues
involving state, local and other requirements.
G. Petition for Rulemaking To Require the Continued Availability of E10
and/or E0
On March 23, 2011, EPA received a petition for rulemaking that EPA
promulgate a rule under its Clean Air Act section 211(c) authority to
ensure the continued availability of gasoline containing 10 vol% or
less ethanol (``<=E10'') at retail stations for use in vehicles,
engines, and equipment not covered by the E15 partial waivers. EPA also
received a number of comments on the proposed rule similarly requesting
that EPA ensure that <=E10 be made available. For the reasons discussed
in section III.F, the Agency is not requiring the availability of E10
(or E0) in this rulemaking and is also denying the rulemaking petition.
In considering the future availability of <=E10, it is important to
remember that EPA's partial waiver decisions allow, but do not require,
E15 to be sold. It is up to businesses to decide whether and how to
produce and sell E15 for MY2001 and newer light-duty motor vehicles.
EPA recognizes that the availability of appropriate fuels is important
for mitigating misfueling, but we cannot forecast now how E15 will be
distributed and marketed over the next several years, and how this
might impact the availability of <=E10. Until E15 enters the market and
further developments take place, requiring the continued availability
of E10 (or E0) would be premature and potentially unnecessary. As the
transition to E15 occurs, we will work with fuel producers,
distributors, and marketers to monitor the availability of E15, E10,
and E0 so that any problems can be addressed on a timely basis.
II. Background
A. Statutory Authority
CAA section 211(f)(1) makes it unlawful for any manufacturer of any
[[Page 44410]]
fuel or fuel additive to first introduce into commerce, or to increase
the concentration in use of, any fuel or fuel additive for use in motor
vehicles manufactured after model year 1974 unless it is substantially
similar to any fuel or fuel additive utilized in the certification of
any model year 1975, or subsequent model year, vehicle or engine under
section 206 of the Act.
Section 211(f)(4) of the Act provides that upon application by any
fuel or fuel additive manufacturer, the Administrator may waive the
prohibition of section 211(f)(1). A waiver may be granted if the
Administrator determines that the applicant has established that the
fuel or fuel additive, and the emission products of such fuel or fuel
additive, will not cause or contribute to a failure of any emission
control device or system (over the useful life of the motor vehicle,
motor vehicle engine, nonroad engine or nonroad vehicle in which such
device or system is used) to achieve compliance with the emission
standards to which the vehicle or engine has been certified. In other
words, the Administrator may grant a waiver for an otherwise prohibited
fuel or fuel additive if the applicant can demonstrate that the fuel or
fuel additive will not cause or contribute to engines, vehicles or
equipment failing to meet their emissions standards over their useful
life.
EPA previously issued a ``substantially similar'' interpretive rule
for unleaded gasoline which allows oxygen content up to 2.7% by weight
for certain ethers and alcohols.\5\ E10 contains approximately 3.5%
oxygen by weight, which means E10 is not ``substantially similar'' to
certification fuel under the current interpretation. As explained at 44
FR 20777 (April 6, 1979), E10 received a waiver of the substantially
similar prohibition by operation of law because EPA did not grant or
deny a waiver request for E10 within 180 days of receiving that
request. At the time of the E10 waiver request, CAA section 211(f)(4)
provided for waivers to be granted by operation of law, but that aspect
of section 211(f)(4) was later removed by the Energy Independence and
Security Act of 2007.
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\5\ 56 FR 5352 (February 11, 1991).
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Section 211(c)(1) of the Act allows the Administrator, by
regulation, to ``control or prohibit the manufacture, introduction into
commerce, offering for sale, or sale of any fuel or fuel additive for
use in a motor vehicle, motor vehicle engine, or nonroad engine or
nonroad vehicle (A) if, in the judgment of the Administrator, any fuel
or fuel additive or any emission product of such fuel or fuel additive
causes, or contributes, to air pollution or water pollution (including
any degradation in the quality of groundwater) that may reasonably be
anticipated to endanger the public health or welfare, or (B) if
emission products of such fuel or fuel additive will impair to a
significant degree the performance of any emission control device or
system which is in general use, or which the Administrator finds has
been developed to a point where in a reasonable time it would be in
general use were such regulation to be promulgated.'' The regulations
adopted today are pursuant to this authority, as well as the
recordkeeping and information collection authority under CAA sections
208 and 114.
B. E15 Partial Waivers
In 2009, Growth Energy and 54 ethanol manufacturers submitted an
application under section 211(f)(4) of the CAA for a waiver for
gasoline-ethanol blends of up to 15 vol% ethanol.\6\ On April 21, 2009,
EPA published notice of receipt of the application and requested public
comment on all aspects of the application to assist the Administrator
in determining whether the statutory basis for granting the waiver
request had been met (74 FR 18228).
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\6\ Since E15 has greater than 2.7 weight percent oxygen
content, E15 needs a waiver under CAA section 211(f)(4).
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On October 13, 2010, EPA took two actions on the waiver request
based on the information available at that time (``October Waiver
Decision'').\7\ First, it partially approved Growth Energy's waiver
request to allow the introduction of E15 into commerce for use in
MY2007 and newer light-duty motor vehicles, subject to several
conditions. The October Waiver Decision was based on a determination
that E15 will not cause or contribute to a failure of MY2007 and newer
light-duty motor vehicles to achieve compliance with the emissions
standards to which they were certified under section 206 of the CAA
over their useful lives. Second, the Agency denied the waiver request
for MY2000 and older light-duty motor vehicles, heavy-duty gasoline
engines and vehicles, highway and off-highway motorcycles, and other
nonroad engines, vehicles, and equipment. The Agency also deferred
making a decision on the waiver request for MY2001-2006 light-duty
motor vehicles to await the results of additional testing being
conducted by the Department of Energy (DOE). On January 21, 2011, EPA
partially approved Growth Energy's waiver request to allow the
introduction of E15 into commerce for use in MY2001-2006 light-duty
motor vehicles after receiving and analyzing the completed DOE test
data (``January Waiver Decision'').\8\
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\7\ 75 FR 68094 (November 4, 2010).
\8\ 76 FR 4662 (January 26, 2011).
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EPA issued the partial waiver decisions with several conditions.
The conditions apply to the parties upstream of the point of the
addition of ethanol who are subject to the partial waiver (gasoline
refiners/importers, ethanol producers/importers, and ethanol blenders
that introduce E15 into commerce), and are designed to ensure that when
E15 is introduced into commerce, it will only be used in the
appropriate light-duty motor vehicles. Some of the conditions call for
the ethanol blenders, fuel manufacturers (gasoline refiners/importers),
and fuel additive manufacturers (ethanol producers/importers) to take
various actions to control the distribution and use of their product so
that E15 is only used in approved motor vehicles. The partial waiver
decisions impose different conditions on the different parties.
Gasoline refiners/importers, ethanol producers/importers, and ethanol
blenders that introduce E15 into commerce are all responsible for
making sure that appropriate labeling occurs on fuel pumps to mitigate
potential misfueling. These parties are also responsible for conducting
fuel pump labeling surveys to ensure that the correct gasoline-ethanol
blends are loaded into the appropriate tanks at retail stations and
that fuel pumps are properly labeled. Gasoline refiners/importers,
ethanol producers/importers, and ethanol blenders must also use PTDs to
properly document information regarding the ethanol blends to help
ensure proper blending and distribution.
C. The Proposed Misfueling Mitigation Measures Rule
On October 13, 2010, EPA issued a proposed rule to mitigate
misfueling and maximize the likelihood that E15 is used only in
vehicles for which its sale is approved. As we explained, the proposed
rule was developed to help ensure that E15 is introduced into commerce
for use only in MY2001 and newer light-duty motor vehicles and in
flexible-fueled vehicles, and not for use in any other vehicles,
engines or equipment.\9\ Some of the proposed regulatory provisions
parallel the partial E15 waiver decision conditions and were expected
to be an effective and
[[Page 44411]]
efficient way to further reduce the potential for in-use emissions
increases that could result from misfueling with E15.
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\9\ 75 FR 68044 (November 4, 2010).
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EPA held one public hearing regarding the proposed rule on November
16, 2010, in Chicago, IL. The public comment period for the proposal
ended on January 3, 2011, and approximately 80 public comments were
submitted. Today's final rule contains a brief summary of the major
comments received, and our responses, on several topics, including the
proposed misfueling mitigation measures, changes to the Complex Model,
and other issues discussed in the proposal. Responses to comments not
addressed here can be found in a separate document entitled ``E15
Misfueling Mitigation Measures Rule Response to Public Comments'' which
is available in the public docket for this rule.
D. Reasons for the Actions in This Rulemaking
In granting partial waivers for E15, EPA imposed various conditions
on fuel or fuel additive manufacturers that use the waivers, including
conditions designed to minimize the potential for misfueling. Under CAA
section 211(f)(4), EPA can place conditions on fuel or fuel
manufacturers but cannot place conditions directly on other parties in
the fuel distribution system. Consequently, EPA placed the partial
waiver conditions on ethanol blenders, fuel manufacturers, and ethanol
producers, the parties subject to the prohibition in section 211(f)(1),
and thus the parties that benefit from the partial waiver of that
prohibition if they choose to make and distribute E15, but not on
retail stations. Since most retail stations are independently owned and
operated, the ethanol blenders, fuel manufacturers, and ethanol
producers that decide to introduce E15 into commerce might need to
develop and enforce business arrangements with a potentially large
number of retail stations in order to meet the partial waiver
conditions.
EPA believes that the provisions adopted in today's final
rulemaking (i.e. misfueling prohibition, fuel pump labeling, PTDs, and
ongoing implementation surveys) are a direct and efficient way to
further reduce the potential for misfueling and the emission increases
that would result from misfueling. Under CAA section 211(c), EPA has
the authority to adopt appropriate controls or prohibitions on the
distribution and sale of fuels and fuel additives to avoid emissions
increases. EPA's use of this authority in today's rule will do that
with respect to E15 that is introduced into commerce in accordance with
the partial waivers. It provides EPA with appropriate tools for
regulatory oversight of the ethanol blenders, fuel manufacturers,
ethanol producers and others introducing E15 into commerce. It adopts
provisions that create additional, strong incentives to properly blend
and label E15 and avoid misfueling. The new provisions, collectively
and in tandem with the partial waiver conditions, will maximize the
likelihood that E15 is used only in motor vehicles covered by the
partial waivers and minimize the potential for emissions increases that
might otherwise occur. The specific provisions are discussed in detail
in Section III, and the relationship between these provisions and the
conditions in the partial waivers is described in Section IV.G. By
making misfueling mitigation more efficient and effective, these
measures should also have the benefit of facilitating the successful
introduction of E15 into commerce.
III. Misfueling Mitigation Program
As explained above, CAA section 211(c) authorizes EPA to control or
prohibit the distribution of a fuel or fuel additive when it will
significantly impair emission control systems or when the emission
products from that fuel or fuel additive will cause or contribute to
air pollution that we reasonably anticipate may endanger public health
or welfare. As described in detail below, EPA is exercising this
authority to establish a prohibition on the use of gasoline containing
more than 10 vol% ethanol in vehicles, engines and equipment not
covered by the partial waiver decisions (i.e., MY2000 and older light-
duty motor vehicles, and in all heavy-duty gasoline engines and
vehicles, motorcycles and nonroad products) in order to prevent or
minimize emission increases that could otherwise occur. We are also
requiring gasoline retail stations and wholesale purchaser-consumer
facilities that sell E15 to properly label their E15 pumps. To
effectuate these prohibitions, and to more generally limit the use of
E15 to MY2001 and newer light-duty motor vehicles, we are also
requiring that relevant information be conveyed by PTDs, and that a
survey designed to demonstrate compliance with labeling, ethanol
content and related requirements be conducted.
As we described in our proposed rule, there are four important
components of an effective E15 misfueling mitigation strategy. First, a
prohibition on misfueling establishes a legal barrier against
production, distribution, sale or use of gasoline containing more than
10 vol% ethanol in vehicles, engines and equipment not covered by the
partial waiver decisions because of the potential consequences for
emissions standards compliance violations by those vehicles, engines
and equipment. The prohibition is broadly applicable, including to
consumers. Second, effective labeling is needed to provide consumers
with the information they need to avoid misfueling, including
information about the prohibition on misfueling and the potential
consequences of misfueling. To be effective, labeling must be done at
the point of sale where the consumer is choosing which fuel to use.
Third, retail stations, wholesale purchaser-consumers and fuel blenders
need assurance regarding the ethanol content and RVP of the fuel (or
blendstock) that they purchase so they can properly blend, store and
label E15 and other fuels. The use of proper documentation in the form
of PTDs has proven to be an effective means of ensuring that retail
stations and other fuel providers know what fuel they are purchasing.
Fourth, appropriate labeling and fuel sampling surveys are necessary to
ensure implementation of E15 content, RVP and labeling requirements
that are in turn important to mitigating misfueling and the emissions
consequences of misfueling. Today's rule adopts provisions covering all
of these areas. The Agency has used this general strategy to implement
several fuels programs, including the unleaded gasoline program, the
RFG program, and the ULSD program. The fourth component of an effective
misfueling mitigation strategy is public outreach and consumer
education. Our experience has shown that consumers need to be engaged
through a variety of media to ensure that accurate information is
timely conveyed to the owners and operators of vehicles, engines and
equipment.
EPA proposed establishing a misfueling prohibition and E15
labeling, PTD and survey requirements, and sought comments on those and
any additional mitigation measures that might be needed to minimize
misfueling with E15. The following sections of this final rule describe
each of the proposed measures, the comments we received about that
measure, our response to those comments, and the final decisions we
made in light of the comments and other available information. We also
discuss several suggestions that some commenters made for other
possible mitigation measures, and our
[[Page 44412]]
conclusion that no additional measures should be required at this time.
A. Misfueling Prohibition
We proposed to prohibit the use of gasoline containing more than 10
vol% ethanol in vehicles, engines and equipment not covered by the
partial waiver decisions, specifically MY2000 and older motor vehicles,
heavy-duty gasoline engines and vehicles, on and off-highway
motorcycles, and nonroad engines, vehicles, and equipment.\10\ The
prohibition is similar in nature to the prohibition on producers of
fuels and fuel additives under section 211(f)(1). However, the
prohibition in section 211(f)(1) only applies to these upstream
parties. The proposed prohibition would also apply at the retail level
as well as to upstream fuel providers and consumers, so that all
parties involved in fueling gasoline-powered products would have a
legal obligation to avoid misfueling the vehicles, engines and
equipment not covered by the partial waivers.
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\10\ Flexible fuel vehicles (FFVs) are designed to meet EPA's
emissions standards on any blend of gasoline and ethanol up to 85%
ethanol. FFVs are not subject to either the waiver denial or the
misfueling prohibition adopted in this rule.
---------------------------------------------------------------------------
Most public commenters that addressed this provision supported it
in view of EPA's decision to deny a waiver for introduction of E15 into
commerce for use in MY2000 and older motor vehicles, heavy-duty
gasoline engines and vehicles, motorcycles, and nonroad products. EPA
based its denial on the lack of test data on the effect of E15 on
emissions from these products and the Agency's engineering judgment
that E15 would likely result in significant exceedances of emission
standards by these products.
Several commenters disputed the need for a misfueling prohibition
because, in their view, E15 would not have adverse emissions
consequences for the vehicles, engines and equipment not covered by the
partial waivers. In making this argument, the commenters were
essentially taking issue with EPA's decision to deny the E15 waiver for
these products. However, the commenters did not provide, and EPA is not
aware of, any new information or analysis that would support a finding
that E15 may be used by the vehicles, engines and equipment not covered
by the partial waivers without significant adverse consequences for
their emission control performance. We are therefore finalizing the
misfueling prohibition as proposed.
B. Fuel Pump Labeling Requirements
1. Proposed Approach
We proposed that gasoline pumps dispensing E15 be labeled and that
this label be applied to any pump dispensing gasoline containing
greater than 10 vol% ethanol but not more than 15 vol% ethanol. We also
solicited comment on whether separate labels should be required for
other gasoline-ethanol blends to avoid potential consumer confusion.
Specifically, we proposed that the language on the E15 label have
four components: (1) An ethanol content information component; (2) a
legal approval component; (3) a technical warning component; and (4) a
legal warning component. We explained that together these four
components highlight the critical information that we considered
necessary to inform consumers about the legal and appropriate use of
E15 and the potential consequences of illegal and inappropriate uses.
The ethanol content information component of the label informs
consumers of the maximum ethanol content the fuel may contain. We
proposed that this component of the label read: ``This fuel contains
15% ethanol maximum.''
The legal approval component of the label includes information that
informs consumers of the types and model years of vehicles for which
E15 may be used. At the time of the proposal, EPA had granted a partial
waiver of E15 allowing its sale for use only in MY2007 and newer light-
duty motor vehicles. Based on that partial waiver, the Agency proposed
that the legal approval portion of the label read as follows:
Use only in:
2007 and newer gasoline cars.
2007 and newer light-duty trucks.
Flex-fuel vehicles.
As noted above, EPA later issued a second partial waiver decision
that allowed E15 to be introduced into commerce for MY2001-2006 light-
duty motor vehicles. Taken together, the two partial waivers allow E15
to be sold for use in MY2001 and newer light-duty motor vehicles, as
well as in vehicles designed and certified to run on gasoline and
gasoline-ethanol blends as high as E85 (``flex-fuel vehicles''). EPA
noted in the proposed rule that if we granted a partial waiver for
MY2001-2006 light-duty motor vehicles, we would modify this component
of the final label accordingly.
The technical warning component of the label alerts consumers that
use of E15 in other engines, vehicles, and equipment might cause damage
to these products. This warning reflects the results of EPA's analysis
of available test and other data and its engineering assessment
concerning the potential impact of E15 on emission controls and other
aspects of vehicle design, materials and operation that can affect
emissions. EPA proposed the following language: ``This fuel might
damage other vehicles or engines.'' We also proposed that the word
``Caution'' be placed at the top of the label, and solicited comment on
other words that could be used to alert consumers, and specifically
asked for comment on the alternative word ``Attention.''
The legal warning component of the label informs consumers that
using E15 in a vehicle or engine for which E15 is not allowed violates
the Agency's prohibition against misfueling. Based on the language
currently used on the low-sulfur diesel (LSD) label (see 40 CFR
80.570), the Agency proposed that the E15 label read as follows:
``Federal law prohibits its use in other vehicles and engines.''
Putting the four components together in a manner intended to
attract consumers' attention, the Agency proposed the following E15
label:
[[Page 44413]]
[GRAPHIC] [TIFF OMITTED] TR25JY11.001
2. Consideration of Comments
We solicited comments on the above label, where it should be placed
and whether labeling should be required for three other levels of
gasoline-ethanol blends: (1) E10; (2) blends containing between 15 and
85 vol% ethanol; and (3) E85. We also sought advice from the FTC's
labeling experts and discussed with FTC staff the issue of labeling
additional gasoline-ethanol blends, which FTC was considering for other
purposes. We shared with FTC staff the suggestions made in public
comments on the proposed E15 label, and they provided us with
information about effective label design, recommendations for
addressing some of the issues raised in the comments, and assistance in
designing the final label. We also considered the appropriateness of
coordinating EPA labels and FTC labels.
Most of the public comments on the proposed E15 label made specific
recommendations for improvement with respect to wording and/or design.
Overall, there was a wide spectrum of suggestions reflecting the
different perspectives of ethanol producers, oil refiners, gasoline
retailers, and manufacturers and users of vehicles, engines and
equipment. Commenters generally agreed with the need for labels, but
differed about how best to alert consumers and provide them with
information for avoiding misfueling, without discouraging or chilling
appropriate use of E15 in MY2001 and newer light-duty motor vehicles.
One commenter also recommended that EPA allow fuel providers to develop
and submit for approval an alternative label, a flexibility afforded by
the Agency's ULSD program. Specific suggestions fell into the following
categories which are discussed in more detail below:
Choice of word for warning.
Description of vehicles that can use E15.
Prohibition statement.
Statement about E15 causing damage.
Addressing non-English speakers.
Portable gasoline containers.
Color, shape, and placement of labels.
Separate labels for different levels of ethanol.
a. Choice of Word for Warning Component
Commenters were divided between those who believed that use of
``CAUTION!'' on the proposed label would deter appropriate use of E15,
and those who believed that it would not be effective at preventing
misfueling. Two commenters stated that any kind of a warning word may
result in skepticism and concern about E15 use in MY2001 and newer
light-duty motor vehicles, and suggested that no warning word be used.
They argued that the proposed label would not promote the successful
introduction of this new fuel into the marketplace. Other commenters
expressed concern that the proposed label was not strong enough and
recommended that ``WARNING'' or ``STOP'' be used. In these commenters'
opinion, the label on its own must provide for adequate informed
consent to prevent misfueling and consumer lawsuits concerning possible
damage from misfueling.
The purpose of today's rule is to mitigate potential misfueling and
the emissions increases that could occur as a result of misfueling. We
are therefore exercising our authority to address the emission
consequences of misfueling. The Agency recognizes, however, that while
the label needs to effectively communicate to consumers about
misfueling, it should avoid deterring E15's use in motor vehicles for
which its sale and use is allowed. We discussed this issue with FTC's
consumer labeling experts who advised that the word ``ATTENTION'' would
more likely attract consumer notice without the risk of discouraging
appropriate use of the fuel.
After considering the comments and FTC's advice, we are finalizing
use of ``ATTENTION'' instead of ``CAUTION.'' Use of ``ATTENTION''
strikes the right balance between alerting consumers about the improper
use of E15 and scaring them away from appropriate use of E15. FTC staff
also suggested that ``ATTENTION'' be placed at an angle in the upper
left corner of the label to help draw consumers' eyes to it (see
Section III.A.2. for further details), and we are adopting that
placement. We believe that ``ATTENTION'' so placed, and in combination
with other label information alerting consumers to the potential for
damage from misfueling (discussed below), will effectively communicate
that care must be taken in fueling with E15 without unduly discouraging
its proper use.
[[Page 44414]]
b. Description of Motor Vehicles That Can Use E15
Many commenters suggested rewording the label's references to the
motor vehicles that can use E15 to clarify and/or streamline those
references. Several also suggested that the label state that E15 is
``Approved for use in 2001 and newer vehicles'' (emphasis added). Two
commenters noted that use of E15 in flex-fuel vehicles is independent
of model year and that flex-fuel vehicles should be listed first. Some
commenters expressed concern that sport utility vehicles (SUVs) and
minivans were not explicitly mentioned in the label even though both
vehicle types fall within the definitions of light-duty vehicles,
light-duty trucks, or medium-duty passenger vehicles and are covered by
the partial waivers. They suggested that there be a consumer-friendly
reference for these vehicles.
We agree with commenters that the language can and should be
clarified and streamlined in a way more readily understood by
consumers. The partial waivers allow E15 to be sold for use in MY2001
and newer ``light-duty motor vehicles,'' meaning cars, light-duty
trucks and medium-duty passenger vehicles. Light-duty trucks and
medium-duty passenger vehicles are regulatory terms that encompass a
range of vehicles including minivans and all but the largest pick-up
trucks (greater than 8,500 pounds gross vehicle weight rating) and some
SUVs (greater than 10,000 pounds gross vehicle weight rating). FTC
staff generally advised that the E15 label be as concise as possible
since consumers are much less apt to read detailed labels, particularly
in the context of routine activities like buying gasoline. With that in
mind, we are finalizing the phrase ``2001 and newer passenger
vehicles'' as the reference to the types of gasoline-fueled motor
vehicles that may use E15. The common denominator of virtually all of
the relevant vehicle types is that they are used to transport people.
``Passenger vehicle'' is a common term and should be more effective in
conveying the types of gasoline-fueled motor vehicles for which E15 can
be sold and used. Since all flex-fuel vehicles are made to use
gasoline-ethanol blends up to E85, all may use E15.
We are leaving the reference to passenger vehicles first in the
list of the types of motor vehicles that can use E15. In most of the
country, gasoline-fueled vehicles are much more common than flex-fuel
vehicles, and under the partial waiver decisions E15 is approved for
use in only MY2001 and newer passenger vehicles. The reference to
passenger vehicles and the model year limitation is thus more relevant
and important to more consumers, and so should precede the reference to
flex-fuel vehicles.
We are not adopting the suggestions to include the phrases
``approved for use in'' or ``model year'' in referring to the vehicle
types that may use E15. EPA's partial waiver decisions are not
approvals for use of E15 in the general sense that term is used; they
are waivers allowing E15 to be introduced into commerce for use in
certain motor vehicles. The Agency's role in the waiver proceeding is
limited to determining whether E15 meets the criteria for a waiver
under CAA section 211(f)(4) and in this rulemaking under section 211(c)
to minimizing the potential for any misfueling that might occur. As for
prefacing the reference to 2001 and newer passenger vehicles with
``model year,'' any potential benefit of adding that phrase is
outweighed by the risk that the additional wording may decrease the
effectiveness of the label. Consumers are likely to understand the
reference to 2001 as indicating model year, and we are mindful that
labels with more words are less apt to be read.
Therefore, today's final rule will require the following language
on the label:
``Use only in:
2001 and newer passenger vehicles;
Flex-fuel vehicles''.
c. Statements About Prohibition and Damage
Commenters were generally supportive of the proposed statements on
prohibition and damage, but suggested variations in the wording and
order of the statements to clarify their scope and meaning. Most
commenters stated that it is essential to include a statement that
``this fuel may damage'' other vehicles, engines and equipment for
consumers to have the information they need to avoid misfueling.
However, several commenters objected to including any damage statement
because they believe available information does not support that E15
may cause damage. In contrast, one commenter argued that the proposed
damage statement should communicate that, in the commenter's view,
significant physical injuries may result from using E15 in lawn mowers,
chain saws, and other equipment.
A number of commenters noted that the proposal's reference to other
``vehicles and engines'' would not necessarily convey the various kinds
of gasoline-powered equipment that should not use E15. Specifically,
one commenter pointed out that ``engine'' is not a term that consumers
use to describe lawn and garden equipment, boats and other nonroad
equipment. Two commenters suggested using graphic symbols or icons to
depict some of the common types of nonroad vehicles and equipment for
which E15 use would be prohibited. One commenter provided sample icons
of a boat, motorcycle, chainsaw, lawnmower and snowmobile, each
depicted in a circle with a slash or X across the image to convey to
consumers that E15 should not be used in those products. Along the same
lines, one commenter suggested including on the label a list of the
various kinds of vehicles, engines and equipment that should not use
E15.
Other commenters provided further suggestions for improving the
wording of the damage and prohibition statements. Three commenters
suggested that the label clarify that ``Federal law prohibits use in
all other vehicles and nonroad engines and equipment.'' Another stated
that the label should be consistent with other EPA labels and should
state: ``Federal law prohibits use in all other model year vehicles and
engines.'' (Suggested additional words in italics.)
In addition to the prohibition and damage statements, some
commenters suggested adding to the label statements that fuel economy
would be adversely affected and that consumers should consult
manufacturers' fuel recommendations. These commenters pointed out that
ethanol has somewhat lower energy content than gasoline and, when
ethanol is cheaper than gasoline, E15 might be priced lower than E10 or
E0. These commenters argued that without an understanding of the
relationship between energy content and fuel price, many consumers
might intentionally misfuel vehicles, engines, and equipment not
covered by the partial waivers if E15 appeared to be a better bargain
than E10 or E0.
After considering all of the comments, we continue to believe that
a damage statement is necessary and appropriate for the E15 label. As
explained in the October Waiver Decision, EPA denied the E15 waiver
request with respect to MY2000 and older light-duty motor vehicles and
all heavy-duty engines, motorcycles and nonroad equipment because (1)
Available data is insufficient to show that E15 would not cause or
contribute to a failure by these products to meet emission standards,
and (2) our engineering judgment is that E15 may adversely affect the
emissions control performance of these products, particularly over
time. The waiver decisions also considered materials
[[Page 44415]]
compatibility, operability, and maintenance issues related to E15 and
their potential impact on emissions. A statement that E15 use in those
products ``may cause damage'' is consistent with and supported by EPA's
technical analysis for its decision to deny the waiver request for
introduction of E15 into commerce for use in these products. Including
the damage statement is also critical to the effectiveness of the E15
label, since consumers are more likely to comply with the label's
direction if they understand that harm might otherwise occur.
We do agree with commenters' suggestion that a reference to
``equipment'' is needed on the label. The label as proposed used the
word ``engines'' to refer to engines in all nonroad equipment. After
considering the comments, we agree that most consumers think in terms
of the types of equipment they own or operate, not the engines that
power the equipment. However, given the extremely broad range of
equipment that uses gasoline engines, we believe it would be infeasible
and counterproductive to attempt to include even a partial list of the
types of products that should not use E15. As noted above, labels
generally need to be brief and succinct to be effective. Also, a
partial list would run the risk of implying that types of equipment not
included on the list are suitable for E15 use. We are therefore
choosing the phrase ``gasoline-powered equipment'' to refer to the many
types of equipment that have gasoline engines. We are also including a
reference to boats since many consumers may not consider boats to be
either ``vehicles'' or ``equipment.'' Moreover, representatives of boat
manufacturers and users expressed particular concerns about the
potential for, and consequences of, misfueling boat engines.
We are otherwise combining and revising the wording of the
prohibition and damage language on the label to reduce the number of
words and increase the directness, and therefore the effectiveness, of
the message, in a manner suggested by FTC staff.
We are not adopting some commenters' suggestions that the label
provide a warning that injury might occur if misfueling results in
product malfunction. In considering all the information before the
Agency (i.e. test data and other information provided by the waiver
applicants and in public comments submitted on the waiver and on the
proposed rule), we determined that the information does not provide a
clear enough basis for including a separate warning about risk of
injury in addition to the warning about the potential for damage.
We disagree with the suggestion to include a statement that fuel
economy would be adversely affected by use of E15. While ethanol has a
lower energy content than gasoline,\11\ the effect of E15 (or E10) on
the fuel economy of a particular model or vehicle depends on a number
of factors (e.g., fuel formulation, engine calibration, manner of
vehicle operation, etc.) that cannot be easily communicated on a label.
To the extent the appropriate information were added to the label,
consumers may be less likely to read the label at all. In light of the
trade-off between providing more, somewhat complex information and
decreasing the likelihood that the label will be read and heeded, we
believe that the damage statement will be more effective in mitigating
misfueling on its own than in combination with fuel economy
information. The costs associated with potential damage of the engine
or replacement of catalysts (see section IV.A for a description of the
costs associated with these repairs) are significant and likely to
provide sufficient incentive not to misfuel with E15. Fuel providers
may use supplemental labels, signs or other forms of communication to
inform their customers of the potential fuel economy impacts of the
various types of gasoline and gasoline-ethanol blends that they sell.
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\11\ Ethanol has approximately 33 percent less volumetric energy
content than conventional gasoline (see CITE RFS2 RIA). A recent
study by the Department of Energy involving 16 light-duty vehicles
from model years 1999 to 2007 found that, when compared to E0, the
average reduction in fuel economy was 3.7 percent for E10, 5.3
percent for E15, and 7.7 percent for E20 (see National Renewable
Energy Laboratory, Oak Ridge National Laboratory, Effects of
Intermediate Ethanol Blends on Legacy Vehicles and Small Non-Road
Engines, Report 1--Updated (February 2009).
---------------------------------------------------------------------------
We also disagree with the suggestion to include a statement that
consumers should consult the manufacturer's fuel recommendation.
Mention of manufacturers' fuel recommendations may confuse consumers,
since E15 only recently received partial waivers allowing its sale for
use in certain vehicles. It is not yet available in the marketplace,
and thus would not be specifically referenced in any existing manual or
manufacturer's specifications.
Today's final rule will therefore require the following damage and
prohibition message at the bottom of the label:
``Don't use in other vehicles, boats, or gasoline powered
equipment. It may cause damage and is prohibited by Federal law.''
We carefully considered the suggestion to add graphic icons to the
label to help convey what products can, or cannot, use E15, and have
decided not to require icons for several reasons. First, the icons
suggested for the on-highway vehicles that can, or cannot use, E15 rely
on text to convey much of their message. Those icons also depict a
passenger car, which is only one of several vehicle types that can use
E15 if from the specified model years. In addition, the other icons
portray only some of the nonroad vehicles and equipment that cannot use
E15, raising the issue noted above concerning partial lists: Depicting
some equipment but not other equipment may lead consumers to think E15
can be used in the types of equipment not depicted. Use of multiple
icons would also make the label more dense and complicated.
In light of these considerations, we are not including icons in the
final label. However, fuel providers may post supplemental labels or
signs that they believe would be useful for informing their customers.
We are also adopting the suggestion made by one commenter to allow fuel
providers to submit to EPA for approval an alternative label. There are
a number of circumstances that may make it appropriate for a retailer
to make small changes in the shape or size of the label and/or include
additional information. (It should be noted that the addition of
information, including icons, would require enlarging the label so that
all of the information on the label may be easily read). To the extent
a fuel provider believes icons would be helpful to its customers, it
may post them on its own signs and/or develop and submit an alternative
E15 label including appropriate icons for EPA consideration and
approval.
d. Addressing Non-English Speakers
Two commenters expressed concern that the label needs to
accommodate non-English speakers, and pointed out that a relatively
high percentage of commercial landscapers that purchase fuel for lawn,
garden, and forestry products may not be able to read or comprehend an
English-narrative label. They suggested that the final label should
contain generic symbols or icons to clearly and strongly convey the
necessary warnings.
We have addressed the use of icons above, but have also considered
whether labels in other languages should be used. We appreciate the
importance of conveying the necessary information to those who do not
speak or read English. However, we are not requiring multi-
[[Page 44416]]
lingual labels at this time because we do not have enough information
to determine under what circumstances one or more additional languages
should be added to the label. The commenters suggesting that labels
accommodate non-English speakers did not provide information that would
allow us to make these determinations. Also, a label in two or more
languages would necessarily be longer and may detract from the
effectiveness of the label as a whole. We will continue to consider
whether bi- or multi-lingual signs would be appropriate, and will work
with stakeholders to address this issue through public outreach and
education as E15 enters the market. As noted above, retailers may also
post additional labels or signs, including in other languages. Further,
today's rule provides the option of seeking EPA approval of an
alternative label that could incorporate languages in addition to
English. Under the regulations, retailers could submit translated
versions of the final label to EPA for approval. Retailers thus have
the flexibility to use signs and/or labels conveying information in any
language they believe is appropriate for their customers.
e. Portable Fuel Containers
Some commenters expressed concern that the label by itself would
not be effective at preventing misfueling of boats and other nonroad
vehicles and equipment. The commenters pointed out that nonroad
products are generally fueled from portable containers, which are in
turn fueled at the same time and location that motor vehicles are
fueled. The commenters stated that any fuel dispensing nozzle used to
fill a motor vehicle could also be used to fill the portable container.
One commenter urged that the labels for pumps dispensing fuels greater
than E10 should also warn against those fuels being dispensed into
portable containers.
We considered this suggestion but have decided that prohibiting the
dispensing of E15 into portable containers is not necessary or
appropriate. The prohibition established by today's rule extends to
misfueling of E15 into nonroad products, including by use of portable
containers, so a separate ban on E15 use in portable containers is not
needed to effectuate the prohibition. Banning use of such containers
for E15 would also prevent their legitimate use, including in
emergencies, for motor vehicles that may fuel with E15. The outreach
campaign being developed can help consumers understand that use of E15
in portable containers is limited to fueling the types of motor
vehicles that may use E15.
f. Color, Size, Shape, Font, and Placement of the Label
There was general agreement among commenters that labels for
gasoline-ethanol blends should be uniform in color, size, and shape for
easy identification. Commenters were divided, however, on what the
color and shape should be, with some commenters focused on what
combination would stand out and/or be more legible, and others
emphasizing coordination with other labels. Several different color
schemes, including FTC's for its proposed gasoline-ethanol blend
labels, were suggested. Shapes other than squares were also urged, with
octagonal and triangular shapes specifically recommended since they are
already associated with stop and hazard signs, respectively.
One commenter recommended that rather than requiring a one-size-
fits-all label, EPA should allow gasoline marketers to determine the
color scheme and appropriate size of the E15 label. Another commenter
specifically cited experience with EPA's ULSD regulations, which did
not specify the color and size of the labels required for that program.
This commenter pointed out that while retailers initially welcomed the
opportunity to design their own labels, ultimately the lack of
consistency in label design resulted in confusion and uncertainty with
respect to compliance and enforcement. The commenter recommended that
EPA should adopt specific label size, color, dimension and design
requirements similar to those specified for dispenser labels under FTC
regulations.
With respect to placement of the label, commenters generally
suggested that labels should be placed directly above, below or next to
the E15 pump nozzle or the button a consumer would use to select E15
from among several fuel choices. One commenter recommended that for
pumps that use one hose to dispense several grades of gasoline the
label should be on the button for selecting the grade for which E15 is
used. For pumps with multiple hoses, this commenter suggested the label
could appear in the same location as the octane ratings for the other
hoses (or above/below the octane rating).
We agree with commenters that the E15 label design should generally
be uniform for easy identification and utility. Significant variations
in label design could thwart the goal of associating the label with E15
and making the label readily recognized and understood. At the same
time, we recognize that slight modifications in size or shape may be
useful or appropriate for a retailer's particular circumstances. For
example, some slight changes in shape may be necessary to allow the
label to be placed where consumers will see it when they are selecting
what fuel to buy. The flexibility afforded by today's regulations will
give retailers the option to develop an alternative label that works
with their pumps. However, alternative labels must include the four
required components of the E15 label, must be as legible as the
required label, and must be similar enough in design that their use
would not confuse consumers or undermine the utility of relatively
consistent labeling of E15.
We have decided to use FTC's proposed color scheme and general
design so that the two agencies' labels could work together as a
coordinated labeling scheme for gasoline-ethanol blends. FTC recently
deferred making a decision on the ethanol labeling portion of their
proposed fuel rating rule because more time was needed to address the
issue.\12\ FTC's proposal was based in part on existing FTC rules for
labeling alternative fuels (see 16 CFR parts 306 and 309). Those rules
specify the color scheme that the FTC used for its proposed labels for
gasoline-ethanol blends. The FTC's alternative fuel labels provide a
generally consistent color scheme for alternative fuels so consumers
may readily recognize pumps and other dispensers that deliver those
fuels. In view of the existing FTC rules for alternative fuel labeling
and FTC's further consideration of gasoline-ethanol blend labeling, we
are adopting the proposed FTC color scheme so that E15 labels may
become part of a broader, coordinated scheme for labeling alternative
fuels in general and gasoline-ethanol blends in particular. Consumers
are more likely to understand the import of both agencies' labels if
they see relatively consistent labels across the relevant types of
fuel. In addition, FTC's proposed labels uses colors, fonts, shape and
other design aspects that make its labels noticeable, easily
understood, and consistent with labeling conventions. An E15 label
similar in appearance should thus be similarly effective. We also note
that we varied the font size of different parts of the E15 label in
light of FTC consumer labeling staff advice that use of larger fonts
for the most important information
[[Page 44417]]
would help draw consumers' attention and make it more likely they would
read the label.
---------------------------------------------------------------------------
\12\ FTC press release ``FTC Issues Final Amendments to Its Fuel
Rating Rule, Including New Octane Rating Method'' available at
http:[sol][sol]www.ftc.gov/opa/2011/03/fuellabel.shtm [accessed
March 21, 2011].
---------------------------------------------------------------------------
We agree with the comments that the label should be placed where
consumers will see it when they are selecting which fuel to buy. We
recognize, however, that pump designs vary widely and evolve over time.
In particular, pumps that use one hose to dispense several grades of
gasoline raise the issue of where to place the label so that it is
associated with the selector button for E15 fuel. Given the wide
variety of pumps, we are not specifying the exact placement of the
label on every type of pump, but we are requiring that retailers place
the E15 label where consumers will see it when they are making their
fuel selection. In the case of pumps with one nozzle dispensing several
grades of gasoline, the regulations direct the retailer to place the
label above the selector button dispensing E15 or otherwise place it so
that it is clear which button is dispensing E15. Using the flexibility
afforded by the regulations for alternative labels, some retailers may
want to put a variation of the E15 label on the selector button itself.
We note also that in response to our request for comment on whether
the designation of ``E15'' be placed at the top of the label, many
commenters agreed that this should be done. Today's rule will require
that ``E15'' be so placed.
g. Separate Labels for Different Levels of Ethanol
Most commenters stated that there is no need to label E0 or E10.
These commenters noted that since the purpose of the rule is to
minimize misfueling with E15, EPA labeling should be limited to fuels
containing more than 10 vol% ethanol. Several other commenters
recommended labels for E0 and every level of gasoline-ethanol blend
(including E10) to provide a comprehensive system for identifying the
amount of ethanol in the gasoline being sold.
We have concluded that it is not useful or necessary to label E0 or
E10. Both fuels are prevalent in the market now, and both may be used
by virtually all vehicles, engines and nonroad equipment. Requiring
labels for E0 and E10 might help consumers understand the spectrum of
gasoline-ethanol blends that are available, but they are not needed to
help minimize misfueling. ``E0'' and ``E10'' labels may also cause some
confusion. Many pumps dispensing E10 are already labeled under state
law, and adding a new label would be duplicative and may lead some
consumers to think that E10 is a new type of gasoline. We believe that
labeling only E15 pumps will help make clear to consumers that E15 is
indeed a new and different blend, and that attention needs to be paid
to avoid misfueling with it. Thus, today's rule will not require labels
for E0 and E10.
Commenters were divided on whether additional labels were needed
for E85, for blends between E15 and E85, and for blender-pumps (pumps
that dispense a range of gasoline-ethanol blends). One commenter stated
that no additional labels were necessary and that requiring an
additional label for these fuels would likely be counterproductive to
the consumer education underway in states where mid-level gasoline-
ethanol blends and E85 are already available. Some commenters believed
that such labels were necessary, with some favoring labels that
indicate a range of ethanol levels and other urging that labels specify
the precise, or close to the precise, level of ethanol being dispensed
(e.g., E20, E30, E40 and so on).
As mentioned above, FTC is considering labels for mid-level
gasoline-ethanol blends. FTC already requires labels for E85 and other
alternative fuels. There are currently about 2,300 E85 pumps and 215
blender pumps dispensing mid- and high-level gasoline-ethanol blends.
These pumps typically have labels or other signage that clearly
identifies mid- and high-level gasoline-ethanol blends as such,
indicates which nozzle or selector button dispenses those higher
blends, and communicates that the blends are for flex-fuel vehicles
only. Most alternative fuel labels subject to current FTC regulations
must also use the color scheme that we have adopted for the E15 label.
In light of these circumstances, we believe that it is sufficient
and appropriate for EPA to require labels only for E15 pumps at this
time. There are relatively few pumps dispensing mid- and high-levels of
gasoline-ethanol blends, and their current labels and signage are
generally designed to attract attention and make clear that the fuel
they dispense is for flex-fuel vehicles only. The E15 label we are
requiring will provide appropriate information for E15, and should not
lead to misfueling with higher gasoline-ethanol blends. In our view, an
owner of a MY2000 car, for example, is not likely to read the E15
label, learn that it is inappropriate for his or her motor vehicle,
move to an E30 or E85 pump, and buy that fuel instead. Also, as
discussed below, the labels that EPA could require in this rulemaking
for higher gasoline-ethanol blends could cause consumer confusion. FTC
is continuing to consider labeling for mid-level gasoline-ethanol
blends, and we anticipate that the two agencies will continue to
consult about ethanol labeling. (For example, EPA and FTC staff are
working to prevent duplicative labeling.) As we work with our
stakeholders to help the public understand the appropriate use of E15,
we will share information and insights with FTC for their
consideration.\13\
---------------------------------------------------------------------------
\13\ We considered requiring EPA labels for higher gasoline-
ethanol blends that combined the information on EPA's label and
FTC's proposed labels. However, FTC's proposed labels contain a more
general damage statement as well as direction to check the owner's
manual. For the reasons discussed above, we do not believe it is
appropriate to include the reference to owners' manuals on EPA's E15
label. Also, it is not clear that EPA could require labels for the
particular ranges of blends for which FTC proposed labels (e.g., 30-
40%, 10-70%). Since we do not have data to show differences in
emission consequences for those particular ranges for all types of
vehicles, engines or equipment, we do not believe it would be
appropriate for EPA to require labels for those particular ranges.
In any event, we do not want to presume the conclusion of FTC's
consideration of ethanol labeling.
---------------------------------------------------------------------------
Since the misfueling prohibition established by today's rule
applies to gasoline-ethanol blends greater than E10, and not just E15,
EPA considered whether to require a label for higher blends in order to
provide information about the prohibition. We concluded, however, that
such labels would more likely confuse consumers than help them avoid
misfueling. The prohibition established in this rule reflects and is
based largely on the same information and engineering assessment
supporting EPA's decision to deny a waiver for E15 to be introduced
into commerce for use in MY2000 and older light-duty vehicles, heavy-
duty engines, motorcycles and nonroad products. In this rulemaking, we
are not addressing the emissions impact of blends above E15 on MY2001
and newer light-duty vehicles. Therefore, the misfueling prohibition
that we are promulgating in this rule applies only to the vehicles,
engines and nonroad products not covered by the E15 partial waivers. In
this context, any EPA labels for blends greater than E15 would
accordingly carry a misfueling prohibition statement that would
reference only MY2000 and older light-duty vehicles, heavy-duty
engines, motorcycles and nonroad products, and not MY2001 and newer
light-duty vehicles. However, such labels might leave the mistaken
impression that blends greater than E15 are currently lawful for
gasoline-fueled MY2001 and newer light-duty motor vehicles, when they
are not. Under CAA section 211(f)(1), those higher blends may be
introduced into commerce only
[[Page 44418]]
for sale for flex-fuel vehicles. As discussed above, the current labels
on pumps dispensing higher gasoline-ethanol blends typically provide
that information. Given the scope of this rulemaking, we have concluded
that adopting EPA labels in this rulemaking for higher gasoline-ethanol
blends could be confusing and counterproductive.
In sum, we expect the E15 label will serve EPA's purpose in
providing consumers with the information they need to avoid misfueling
with E15, and that it is not appropriate to adopt labeling requirements
for blends above E15 in this rulemaking.
3. Final Fuel Pump Labeling Requirements
Today's final rule requires the wording and general color and
design aspects of the label described above. In addition, we are
allowing retailers the flexibility to submit alternative labels to EPA
for approval. Such alternatives may potentially include the addition of
icons and other languages, and small changes in shape and size (except
to the extent a larger size is necessary to accommodate more
information), but must include the four required components of the E15
label.
We are not requiring labels for other gasoline-ethanol blends.
Thus, only the E15 label is required for pumps dispensing that fuel.
Placement of the label will depend on the type of pump that is
used. In the case of pumps with one nozzle dispensing several grades of
gasoline, the regulations direct the retailer to place the label above
the selector button dispensing E15 or otherwise place it so that it is
clear which button is dispensing E15. In the case of pumps with a
nozzle for each grade, the regulation directs the retailer to place the
label where consumers will see it when they are making their fuel
selection.
The final E15 label is as follows:
[GRAPHIC] [TIFF OMITTED] TR25JY11.002
C. PTD Requirements
EPA proposed several additions to existing PTD requirements to
provide the information needed for fuel providers to properly blend and
label E15 fuel. EPA has previously established similar requirements for
PTDs for RFG and blendstocks to help ensure downstream compliance with
national RFG standards. As we explained in the proposed rule, the
potential introduction of E15 into the marketplace makes it important
to include additional information on the PTDs that accompany the
transfer of gasoline and gasoline blendstocks used for oxygenate
blending, both for RFG and conventional gasoline. We also noted that
the type of additional information needed differs for businesses
upstream versus downstream of the point of ethanol addition. Most
commenters agreed that PTD changes are necessary to minimize misfueling
and to help ensure downstream compliance with our fuels regulations as
E15 enters the market.
1. PTD Requirements Downstream of the Point of Ethanol Addition
EPA proposed to include on PTDs language indicating the amount of
ethanol in the blend and the summertime RVP standards applicable to the
blend so that downstream marketers can properly label E15 fuel and
avoid commingling fuels that could result in RVP and other
violations.\14\ EPA proposed that the following statements be included
on PTDs for pure gasoline (E0) and the various gasoline-ethanol blends
downstream of the point where ethanol blending takes place:
---------------------------------------------------------------------------
\14\ As was indicated in the proposed regulations, the RVP
language would be required for PTDs only for the summertime RVP
season.
For E0: ``E0: Contains no ethanol. The RVP does not exceed [Fill in
appropriate value]''.
For E10: ``E10: Contains between 9 and 10 volume percent ethanol.
The RVP does not exceed [Fill in appropriate value]''.
For E15: ``E15: Contains up to 15 volume percent ethanol. The RVP
does not exceed [Fill in appropriate value]''.
For EXX: ``EXX--Contains up to XX% ethanol.
``EXX'' refers to fuels blends above E15, up to and including E85
and fuel blends below 9 volume percent ethanol. The maximum potential
ethanol content of the fuel would be required to be specified on the
PTD in the place of ``XX''.
Most comments were generally supportive of the language as
proposed. One commenter recommended that the language on PTDs for
gasoline-ethanol blends should be simplified and standardized, and
should read: ``Contains at least volume percent
ethanol and up to volume percent ethanol. RVP does
not exceed psi.'' EPA agrees that standardizing the
language for gasoline-ethanol blends is
[[Page 44419]]
simpler and easier to understand, and is finalizing changes to the
required PTD language for gasoline-ethanol blends to reflect this. For
E0, we are finalizing the language to read as proposed (i.e., ``E0:
Contains no ethanol''), since the standardized language suggested by
commenters contains more information than necessary for gasoline
containing no ethanol.
Another commenter argued that the language ``The RVP does not
exceed [Fill in appropriate value]'' is unnecessary, as the petroleum
industry has a long history of distributing gasoline with the correct
RVP to the correct area, and E15 will not change this situation. In
contrast, another commenter stated that the proposed requirements to
include ethanol content and maximum RVP on the PTD downstream of the
point of blending would be beneficial, because it would alleviate the
need for additional downstream testing. After considering the public
comments, EPA concludes that, downstream of the point where ethanol
blending takes place, information on the maximum ethanol concentration
and RVP of gasoline and gasoline-ethanol blends is needed to help
ensure that shipments of E15 and other fuel are delivered into the
appropriate storage tanks at retail and fleet fueling facilities and
not improperly commingled. The introduction of E15 into the marketplace
will increase the complexity of blending, distributing and selling
fuel. The required additions to PTDs will help fuel providers comply
with E15 labeling requirements, the summertime RVP requirements for E0,
E10 and E15, and the prohibition against misfueling with E15 (including
gasoline-ethanol blends greater than 10 vol% ethanol and up to 15 vol%
ethanol). Therefore, EPA is finalizing the requirement that information
on the maximum ethanol concentration and RVP of gasoline and gasoline-
ethanol blends be included on PTDs downstream of the point of ethanol
addition.
EPA also requested comment on whether additional language on E10
PTDs is needed to inform parties that a blend containing between 9 and
10 vol% ethanol which benefits from the 1.0 psi RVP waiver under CAA
section 211(h) may not be commingled with E0 or a gasoline-ethanol
blend that contains less than 9 or more than 10 vol% ethanol. We
received comments advocating that EPA require that PTDs for gasoline-
ethanol blends higher than 10 vol% ethanol state that those volumes are
not eligible for the 1.0 psi RVP waiver. One commenter also suggested
that, to avoid downstream commingling of E10 and other fuels not
eligible for the 1.0 psi RVP waiver, EPA should incorporate additional
language into the E10 PTDs stating: ``This blend is subject to the 1.0
psi RVP waiver. Do not blend with gasoline containing anything other
than between 9 and 10 vol % ethanol.'' EPA has decided to include the
suggested language to provide clarity and avert potential instances of
improper commingling of fuels eligible for the 1.0 psi RVP waiver and
those that are not. Thus, we are finalizing a requirement that for
gasoline-ethanol blends containing between 9 and 10 vol% ethanol, the
PTD must state: ``The 1.0 psi RVP waiver applies to this gasoline. Do
not mix with gasoline containing anything other than between 9 and 10
vol% ethanol.''
2. PTD Requirements Up to and Including the Point of Ethanol Addition
EPA proposed that PTDs for gasoline or gasoline blendstock used for
oxygenate blending (BOBs) in the manufacture of gasoline-ethanol blends
that are subject to summertime RVP controls include the maximum RVP of
the BOB to avoid improper blending of E15 or commingling with E15 and
other fuels. We also proposed that such PTDs in non-RFG areas indicate
what ethanol concentration is suitable to be blended with the BOB to
facilitate ethanol blender compliance with applicable EPA summertime
RVP requirements.
Specifically, we proposed that the following statements be included
on the PTDs for BOBs in non-RFG areas:
``Suitable for blending with ethanol at a concentration up to 15
volume % ethanol'' or, in the case of a BOB designed to take advantage
of the 1 psi allowance for E10 in 40 CFR 80.27(d)(2):
``Designed for the special RVP provisions for ethanol blends that
contain between 9 and 10 volume % ethanol''.
``The RVP of this blendstock/base gasoline for oxygenate blending
does not exceed [Fill in appropriate value]''.
Comments were generally supportive of the proposed language,
although EPA received a comment stating that the requirement to include
the RVP of a BOB on the PTD is not useful because regulated parties are
already prohibited from releasing a finished product onto the market
that exceeds the regional and/or seasonal RVP requirements. The
commenter argued that the proposed requirement overcomplicates an
approach that has worked well in the past and that PTD requirements for
BOBs should be flexible and need only contain the type and level of
oxygenate with which the BOB should be blended, with additional
language included at the discretion of the regulated party. However,
while the current approach to compliance with the relevant RVP
requirements may work under current conditions, in light of the
increasing complexity that will come with the entry of E15 into the
market, EPA believes that, upstream of the point where E10 and E15 are
manufactured, the maximum RVP is needed on the PTDs for BOBs to
facilitate ethanol blender compliance with the applicable EPA
summertime RVP requirements.
In order to help ensure that the proposed blendstock commingling
restrictions are observed, we requested comment on whether the
following language should be added to the PTD for a BOB designed to
take advantage of the 1.0 psi allowance for E10: ``The use of this
gasoline to manufacture a gasoline-ethanol blend with less than 9 vol%
ethanol or E15 may cause an RVP violation.'' Some commenters argued
that the proposed changes to the PTD language do not sufficiently
address the consequences of blending additional levels of ethanol in
gasoline beyond 10 vol% and that language similar to what EPA proposed
should be added to the final regulations. One commenter stated that the
final rule must ensure that PTDs make it clear that any gasoline-
ethanol blends above E10 do not receive the 1.0 psi RVP waiver. The
commenter suggested that EPA require the following language on PTDs for
fuel for which the waiver does not apply: ``Adding ethanol to this
product will result in a blend higher than E10 which will not qualify
for the one pound waiver.'' After considering these comments, EPA has
decided to require the additional suggested language on PTDs for BOBs
designed to take advantage of the 1.0 psi RVP allowance. This PTD
language will serve to remind blenders that gasoline-ethanol blends
containing more than 10 vol % ethanol do not receive the 1 psi RVP
waiver. Furthermore, the PTD language clarifies the proper amount of
ethanol with which the associated fuel may be blended. EPA believes
that this additional PTD language will help prevent downstream
violations of the RVP requirements for E15 and other fuels.
In conclusion, for PTDs for gasoline or BOBs up to and including
the point of ethanol addition, we are requiring the following language:
``Suitable for blending with ethanol at a concentration up to 15 vol %
ethanol'' or, in the case of a BOB designed to take advantage of the
1.0 psi allowance for E10 in 40 CFR 80.27(d)(2):
[[Page 44420]]
``Suitable for the special RVP provisions for ethanol blends that
contain between 9 and 10 vol % ethanol.''
``The RVP of this blendstock/gasoline for oxygenate blending does
not exceed [Fill in appropriate value] psi.''
``The use of this gasoline to manufacture a gasoline-ethanol blend
containing anything other than between 9 and 10 vol % ethanol may cause
a summertime RVP violation.''
3. General PTD Requirements
We proposed several general PTD requirements so that the specific
information discussed above is useful to the various parties involved
in fuel production, distribution and marketing. Specifically, we
proposed that on each occasion when any person transfers custody and/or
ownership of any gasoline or gasoline BOB, the transferor would be
required to provide the transferee with an appropriate PTD identifying
the gasoline/blendstock and its characteristics (as defined below), as
well as such general information as the names and addresses of the
transferor and transferee, the volume of product being transferred, the
location of the product on the date of transfer, and other specific
information. We proposed that all parties be required to retain PTDs
for a period of not less than five years and provide them to EPA upon
request.
We also proposed that PTDs be required to be used by all parties in
the fuel distribution chain down to the point where the product is
sold, dispensed, or otherwise made available to the ultimate consumer.
We proposed that PTDs would be required to travel in some manner (paper
or electronically) with the volume of blendstock or fuel being
transferred. Additionally, we proposed that product codes could be used
to convey the information required as long as the codes are clearly
understood by each transferee, but that the full proposed text would
need to be included on the PTD for transfers to truck carriers,
retailers, or wholesale purchaser consumers.
We received comments indicating that space is limited on the
physical PTDs, and that EPA should allow for the use of abbreviations
and the printing of text on the back of the PTD, provided a clear
reference to the back is made on the front. While EPA does require
certain language to be included on PTDs, we generally do not specify
the form that the PTD must take. We agree that printing on the back of
a PTD is appropriate, provided all the required language is included on
the PTD and a clear reference to the printing on the back is made on
the front of the PTD. Therefore, EPA is allowing parties to print
required language on the back of the PTD, provided there is a clear
reference on the front. The commenter also suggests the use of ``%'' in
place of ``percent'' and ``vol'' in the place of ``volume.'' EPA agrees
that the use of these particular abbreviations is reasonable as they
are generally understood by industry, and is allowing for the use of
``%'' in place of ``percent'' and ``vol'' in the place of ``volume.''
Finally, we received comments stating that, if product codes can be
used on PTDs as proposed by EPA, EPA should also require a product code
key on the PTD, as the use of product codes in the current distribution
chain has created confusion. EPA believes that the limitations proposed
for the use of product codes are sufficient to prevent confusion, as
those parties who might be confused by the use of product codes will
not receive PTDs that contain them. Specifically, the proposed
requirement stipulated that product codes may not be included on PTDs
for transfers to truck carriers, retailers, or wholesale purchaser
consumers, since these parties are more likely to be unfamiliar with
the meaning of product codes. Therefore, EPA is allowing for the use of
product codes on the PTD provided the codes are clearly understood by
each transferee, and is requiring that the full proposed text be
included on the PTD for transfers to truck carriers, retailers, or
wholesale purchaser consumers. Although EPA is not requiring a product
code key on PTDs, parties are encouraged to include them whenever it
would be useful to others in understanding product codes downstream in
the distribution chain.
The final rule makes the PTD requirements applicable beginning
November 1, 2011, to allow sufficient time for all the relevant parties
in the fuel distribution chain to comply. Businesses wishing to begin
marketing E15 prior to that date may do so by explaining in the plan
required by the E15 partial waiver conditions how the PTD requirements
of the partial waivers will be addressed. (As discussed in a later
section of this notice, businesses that introduce E15 into commerce do
so under the E15 partial waivers and must comply with the partial
waiver conditions. Today's rule will facilitate compliance with some
conditions, but do not supplant them.) Under the waivers, plans must be
submitted to EPA to address the waivers' misfueling mitigation
conditions, which include PTD and survey requirements. Prior to the
effective date for compliance with the PTD requirements of today's
rule, such a plan should describe how PTDs for gasoline, blendstocks or
gasoline-ethanol blends would be utilized by the various parties
involved in marketing E15 before the compliance date for today's PTD
regulations. Such a plan could follow the PTD approach finalized in
today's rule to help ensure that appropriate labeling of pumps will
occur and that compliant fuel will be dispensed. In this way, a plan
for the introduction of E15 may be implemented prior to the compliance
date for PTDs as specified in today's rule.
D. Ongoing Implementation Survey
Consistent with the misfueling mitigation conditions of the E15
partial waivers, EPA proposed that the parties involved in making,
distributing and selling E15 be responsible for conducting an ongoing
survey of the implementation of the labeling, ethanol content and RVP
requirements for E15.\15\ As we explained, the purpose of the survey
program is to help ensure that fuel pump labeling requirements are
being met at retail stations or wholesale purchaser-consumer
facilities, that the appropriate level of ethanol content is being
properly blended and documented in fuel shipments, and that the RVP
limitation of the E15 partial waivers is being met. The survey would
also deter violations of the ethanol content, labeling and RVP
requirements.
---------------------------------------------------------------------------
\15\ See 75 FR 68054-68056.
---------------------------------------------------------------------------
EPA proposed to provide responsible parties with the flexibility to
conduct surveys that reflected the geographical scope of their plans
for E15 distribution and sale. Survey Option 1 would allow an
individual or group of gasoline producer(s)/importer(s), ethanol
producer(s)/importer(s), and/or oxygenate blender(s) to conduct a local
or regional survey if their E15 business plans are limited in
geographical scope. Survey Option 2 would allow responsible parties to
conduct a nationwide survey, which would likely become the most
efficient option as businesses decide to sell E15 in more parts of the
country. EPA explained that the flexibility afforded by these two
options would be appropriate given the likelihood that E15 will
gradually expand into the marketplace. Based on the history of the
transition to E10, we expect that sale of E15 will initially begin in a
relatively small number of retail stations in a few geographic areas.
In that case, it may make sense for responsible parties to comply with
survey requirements via Survey Option 1 to limit costs. If E15 expands
beyond
[[Page 44421]]
a few areas, Survey Option 2 may become more cost-effective. The
parties involved in selling E15 can thus decide which survey option
makes the most sense for their circumstances.
1. Proposed Approaches and Consideration of Comments
a. General Survey Comments
In the NPRM, we proposed that ethanol producers/importers, gasoline
producers/importers, and oxygenate blenders involved in introducing E15
into the market be responsible for carrying out the proposed survey
provisions. Several commenters stated that it would make little sense
to include ethanol or gasoline producers/importers as required
participants in the survey given their lack of direct control over
relevant regulated activities (e.g. proper labeling at a retail station
or blending too much ethanol into gasoline). These commenters also
stated that the proposal would unnecessarily and inappropriately shift
EPA's compliance and enforcement obligations onto industry, and that
EPA should fund and conduct the survey itself. Some commenters
specifically argued that the sole responsibility of complying with
survey requirements should be on ethanol blenders and marketers that
choose to blend and market E15. Some commenters also stated that unlike
the RFG and ULSD survey programs, which allow responsible parties to
reduce compliance costs and/or help establish alternative affirmative
defenses to fuel standard violations, the E15 survey program provides
no benefits to the responsible parties and may add an additional level
of complexity that would hinder the introduction of E15 into commerce.
When EPA granted the partial waivers allowing E15 to be introduced
into commerce for MY2001 and newer light-duty motor vehicles, it placed
a survey requirement on the fuel and fuel additive manufacturers (i.e.
gasoline manufacturers/importers, ethanol producers/importers, and
oxygenate blenders) that introduce E15 into commerce as a waiver
condition in order to mitigate misfueling. Since fuel and fuel additive
manufacturers are the parties that are subject to the CAA section
211(f)(4) prohibition that was partially waived for E15, they are the
parties that, under the partial waivers of the prohibition, bear the
obligation to introduce E15 in a manner that avoids misfueling if they
choose to make use of the waivers. For a similar reason, to minimize
the misfueling that might result from the introduction of E15 into
commerce for use by some vehicles but not other vehicles, EPA proposed
that these parties be subject to the survey requirements under the
misfueling mitigation regulations. This aspect of the proposal also
ensures that compliance with the survey requirements of the rule (at 40
CFR 80.1502) would help satisfy the survey conditions of the partial
waiver decision.
After considering the public comments, we have concluded that it is
appropriate for the parties involved in making and selling E15 to be
responsible for conducting surveys that assess implementation of the
E15 partial waiver conditions related to misfueling mitigation. The
partial waivers allow businesses to introduce E15 into commerce for use
in MY2001 and newer motor vehicles. To the extent businesses desire to
avail themselves of the opportunity to make and sell E15, they should
also bear the cost of monitoring compliance with misfueling mitigation
adopted in today's action. EPA has required regulated parties to
conduct surveys in the RFG and ULSD programs if they choose to take
advantage of regulatory provisions that provide greater compliance
flexibility made possible by the surveys. For E15, EPA has granted
partial waivers that make it necessary for those who take advantage of
the waivers to take certain steps to mitigate misfueling and limit RVP
and thereby avoid the emission increases and standard exceedances that
would otherwise result. Although the case for surveys in the RFG, ULSD
and E15 contexts is not entirely the same, the common, compelling
thread is that when regulated parties seek opportunities that may
heighten the risk of emission increases, they should be responsible for
taking steps to offset or minimize that risk. In all three cases,
surveys are an effective means of reducing risk--and at relatively low
cost. Moreover, complying with survey requirements will help
responsible parties satisfy waiver conditions and introduce E15 into
commerce, and will also help establish an affirmative defense to
violations found downstream for upstream parties. For these reasons,
EPA is finalizing the list of responsible parties as proposed.\16\
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\16\ Under the final rule, any oxygenate blender that blends a
gasoline that contains greater than 10 vol% and less than or equal
to 15 vol% ethanol is responsible for satisfying the survey program
requirements along with the gasoline and ethanol producers/importers
that manufacture, introduce into commerce, sell or offer for sale
E15, or base gasoline, BOB, or ethanol that is intended for use in
the manufacture of E15. To help blenders be aware of those gasoline
and ethanol producers/importers, today's regulations provide that a
gasoline producer/importer intends a base gasoline or a BOB for use
in manufacturing E15 if a producer/importer amends its registration
to include E15 under 40 CFR 79 or designates that their base
gasoline or BOB may be suitable for the addition of up to 15 vol%
ethanol in the PTDs accompanying the fuel or blendstock (see
discussion of PTD requirements in Section III.B.). In addition,
under the regulations, any ethanol producer/importer that sends
ethanol into the marketplace is assumed to intend that the ethanol
may be used to manufacture E15 unless the ethanol producer/importer
demonstrates (e.g., through contracts) that its ethanol is not for
use in the manufacture of E15.
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EPA also received comments that it should make survey plans and
results available to the public. EPA will make plans and results
available in the same manner as it has made plans and data from both
the RFG and ULSD survey programs available to the public. For example,
EPA has provided the Clean Diesel Fuel Alliance (CDFA) with quarterly
summary data of the performance of the ULSD survey program for
publication on the public CDFA Web site. EPA is committed to providing
timely data to the public and will disseminate E15 survey data through
avenues similar to those utilized in previous survey programs.
Some commenters suggested that EPA should require that surveys
include visual monitoring of pumps in order to observe and record
customer behavior to determine the rate of actual misfueling. Other
commenters suggested that EPA should conduct its own survey to monitor
actual misfueling rates at retail stations. EPA does not believe that
it is necessary to require that surveys include visual monitoring at
this time. As the transition to E15 occurs, we plan to work with
industry, state, environmental and consumer stakeholders to track
developments and evaluate the effectiveness of the required misfueling
mitigation measures, including the prohibition against misfueling with
E15. Also, as noted previously, we are working with ethanol and other
stakeholders to help establish a public education and outreach campaign
to assist fuel producers, distributors, retailers and consumers in
understanding how E15 may be made, distributed, sold and used. That
effort can help identify and resolve misfueling issues that may develop
as E15 moves into the marketplace.
EPA proposed to include the testing of fuel samples for RVP to
ensure that E15 being sold at retail stations was in compliance with
the RVP condition of the E15 waiver and that an E10 fuel that used the
1.0 psi RVP waiver under CAA section 211(h) was not commingled with
E15, which must have a lower RVP in the summertime. EPA received a
[[Page 44422]]
number of comments both in favor of and opposed to including RVP
testing. Those who were opposed argued that determining RVP levels of
E15 and other fuels was unrelated to misfueling, that existing RVP
controls have proven effective over time, and that it was up to EPA to
enforce RVP requirements with the aid of states without imposing
additional costs on industry.
EPA continues to believe that it is necessary and appropriate for
the surveys to measure the RVP of fuel samples from pumps labeled as
dispensing E15. For E15 to be lawfully sold under the partial waivers,
it must have the proper ethanol content, not exceed 9.0 psi RVP in the
summertime, and be dispensed from properly labeled pumps. It is thus
appropriate for the surveys to measure the RVP of fuel labeled as E15
in order to determine whether E15 is being properly blended and sold
under the partial waivers. However, EPA believes that the comments
opposing RVP sampling for fuels being dispensed from pumps not labeled
for E15 have merit. Since a fuel with an ethanol content above 10 vol%
up to 15 vol% that is dispensed from a pump lacking the E15 label is
not covered by the partial waivers, its sale violates the misfueling
prohibition established in today's rule, regardless of its RVP.
Therefore, requiring that surveys sample the RVP of such a fuel is not
necessary to determine that its sale is unlawful. We also believe that
the current controls on summertime RVP established in 40 CFR 80.27
adequately ensure that E0 and E10 meet the applicable RVP standards. We
are therefore limiting the requirement to measure RVP to fuels being
sold and labeled as E15.
One commenter asked that the survey be fair and balanced and not
place any undue burdens on small petroleum marketers and retailers. EPA
is committed to not placing undue burdens on small businesses.
Retailers do not have any obligations to conduct a survey; however,
they are responsible for complying with E15 labeling requirements if
they choose to sell E15, and they are subject to the prohibition
against misfueling with E15. EPA believes that by allowing two survey
options, it is providing marketers and other small businesses
flexibility to determine which survey method is most practical if they
choose to sell E15.
b. Survey Option 1
EPA received many comments about Survey Option 1. Some commenters
argued that Survey Option 1 would not provide the Agency with accurate
information to the degree that a nationwide survey would, because a
geographically limited survey would not necessarily detect E15 sent
beyond the areas covered by the survey. Some commenters urged that we
eliminate Option 1 altogether. These commenters pointed out that the
national ULSD and RFG survey programs have been effective and that
there was no reason to deviate from such an approach for E15.
The Agency continues to believe that Survey Option 1 is appropriate
to provide for parties that choose to manufacture, market, or sell E15.
Unlike the ULSD and RFG programs, which regulated the content of fuels
that were already distributed and sold, E15 will likely enter the
market first in a few areas of country and then gradually expand to
other areas over time. Under these circumstances, it is appropriate to
provide businesses that decide to sell E15 in a limited area with the
option of developing a relatively localized survey. EPA believes that
Survey Option 1 can provide the same rigor as a nationwide survey for
the areas potentially affected by business decisions to sell E15 in a
limited area. Survey Option 1, as finalized today, includes survey
requirements (e.g. sampling and testing methods) similar to those
applicable to the national survey. Also, to be approved, surveys under
Survey Option 1 will have to take a robust approach to surveying
affected areas considering the fuel distribution network for those
areas. EPA provides a similar opportunity to conduct localized or
individual surveys under the RFG and ULSD survey programs, and we
believe that it is appropriate to provide parties making, marketing and
selling E15 the opportunity to choose which approach is most economical
and effective in ensuring proper ethanol content and labeling
downstream. We are also clarifying the language at Sec. 80.1502(a) to
reflect that a survey program conducted under Survey Option 1 must
adhere to requirements for robustness similar to those applicable to a
national survey.
Other commenters argued that Survey Option 1 is overly broad and
not practical. These commenters stated that as written the proposed
regulations implied that all gasoline refiners/importers and ethanol
producers/importers would have to survey each area their products could
enter even though they would have no idea whether their products are
being used to blend E15. In response to these comments, it is important
to clarify that the obligation to conduct a survey applies only to
those parties that decide to make, distribute or sell E15 or their
gasoline or ethanol for use in E15. Any party that chooses not to
manufacture, market, and/or sell E15 does not need to comply with the
rule's survey requirements. Any party that chooses to market ethanol,
gasoline, or gasoline blend stock as appropriate for use in E15 is
subject to the survey requirement. If a party wants to use Survey
Option 1, the party will need to limit where its fuel or fuel additive
is sold and distributed. If a party does not want to limit the
distribution of its product, then Option 1 would likely not be
appropriate for that party. The choice is up to each party considering
how the party decides to market their fuel or fuel additive--with or
without any limitation on its eventual use downstream. There are many
benefits associated with deciding to market a fuel or fuel additive
without limitation, but a companion responsibility is to then develop a
survey program that is appropriate to the distribution of the product.
One commenter suggested that a survey of five percent of the
stations that sold a responsible party's fuel in a prior year be deemed
sufficiently representative. This commenter suggested that for the
first year of sampling under Option 1, the responsible party should
conduct a survey that represents the higher of either: (1) Five percent
of the responsible party's estimate of the number of stations that will
sell the responsible party's E15 during the first survey year; or (2)
five percent of the stations where the responsible party sold fuels
containing ethanol the prior year. This commenter pointed out that five
percent was approximately the number of stations EPA proposed be
surveyed annually under Survey Option 2.
EPA does not agree with this approach to determining the minimum
number of stations to be sampled. The Agency chose the number of
samples required under Survey Option 2 using an appropriate statistical
approach based on the previous performance of the similar ULSD survey
program. The number of samples required under that program, and
proposed for Survey Option 2, can fluctuate year to year since the
number of samples is based in part on noncompliance rates; therefore,
more than five percent of retail stations may need to be sampled in a
particular survey year. Furthermore, the number of samples for a survey
conducted under Survey Option 1 can vary considerably depending on the
size and scope of the individual survey plan. Since survey plans should
use statistical means to determine the appropriate number of samples
needed to comply with the general survey requirements being
[[Page 44423]]
adopted, the Agency believes it would be inappropriate to specify a
minimum number of samples or percentage of stations to be sampled. The
Agency believes that the proposed approach to determining sample size
provides appropriate flexibility to responsible parties. Therefore, EPA
is finalizing Survey Option 1 as proposed.
c. Survey Option 2
EPA received many comments about most aspects of proposed Survey
Option 2, the nationwide ethanol content and E15 labeling survey.
Several commenters stated that the proposed requirements that a fuel
sample be shipped on the same day it is collected, and that the sample
be analyzed for ethanol content within 24 hours, are unnecessary to
ensure program integrity, are not practically feasible, and create
unnecessary additional costs. We believe that these comments have
merit. We chose 24 hours to be consistent with the fuel sample
transport and analysis deadlines required in the ULSD and RFG survey
programs. However, commenters noted that the independent survey
association that has conducted the ULSD and RFG survey programs for the
past 15 years has shown that it is not practical to find a shipping
carrier that will consistently meet the required 24-hour schedule. One
commenter suggested that EPA allow the use of ground shipment service,
which takes in general 1-5 days to be received at the lab. This
commenter also pointed out that for testing samples, due to the volume
of samples that will need to be analyzed, 72 hours would be a best case
scenario, with 10-12 business days being more realistic.
EPA believes that it should impose practical, cost-effective
requirements regarding the shipping and testing of fuel samples
collected as part of the surveys. Therefore, EPA will require that
samples be shipped from the retail station to the laboratory for
analysis within five days. Additionally, EPA is requiring that samples
be analyzed and reported to EPA for both oxygen content and RVP, if
applicable, within 10 days of receipt at the laboratory. These changes
will reduce the costs of conducting the survey. However, EPA is not
changing ULSD and RFG survey requirements at this time since we did not
propose to make changes to those survey programs in the NPRM. EPA may
adjust the time allotted for shipment and analysis of fuel samples for
these programs in an upcoming rulemaking.
EPA also received comments suggesting that surveys begin only after
E15 has achieved a certain level of market penetration considering data
from the previous year. One commenter specifically suggested that the
survey year begin on July 1 instead of January 1 of the year E15 is
introduced into commerce. EPA does not believe that it is appropriate
for surveys to begin only after E15 has been on the market. The purpose
of the survey is to help ensure that E15 is being properly blended and
labeled so that misfueling is minimized. That purpose needs to be
served from the time E15 first enters the market. Also, we do not
believe it is feasible to determine whether an area has exceeded any
level of market penetration without accurate survey data upon which to
base that determination. Additionally, the misfueling waiver conditions
require that a survey plan be approved by EPA and that implementation
of the plan begin before E15 may be introduced into commerce. EPA
believes that it is best to keep the final survey requirements
consistent with the misfueling conditions outlined in its partial
waiver decisions.
EPA does not agree that changing the start date of the survey from
January 1 to July 1 would be beneficial since, if E15 actually enters
the market earlier in the year, the later start date would delay
delivery of information needed on a more real-time basis to minimize
labeling and other problems that could lead to misfueling. The survey
programs for the other fuel programs have been conducted with a January
1 start date and for a normal calendar year, and there is no reason to
believe that an E15 survey could not also be conducted on the same
schedule. Furthermore, the existing and proposed survey programs break
surveys down into four quarterly surveys that ensure that EPA is
receiving more real-time information on a regular basis that is not
tied to any particular start date. Therefore, EPA is finalizing the
survey timing requirements as proposed.
EPA proposed that a nationwide ethanol content and E15 labeling
survey conducted under Survey Option 2 have a minimum of 7,500 samples
annually and that the next year's survey sample size be determined by
the equation found at 40 CFR 80.1502 based on the previous year's non-
compliance rates. EPA also sought comment on whether it should allow a
smaller number of samples in the first years of the nationwide survey
in order to reduce burden. EPA received comments that suggested that
EPA should require fewer or more samples than proposed. For example,
one commenter suggested that EPA sample 20 percent of the retail
stations nationwide. Another commenter suggested a reduction in the
number of samples in the first year since E15 will not likely be sold
at many retail stations the first year it is introduced into commerce.
The sample size methodology and minimum sample size EPA proposed
were based on statistical principles and past survey experience with
similar programs. Reducing the sample size even in the first year would
compromise the statistical rigor, and therefore the effectiveness, of
the program. If, as expected, E15 is initially marketed and sold in a
limited geographic area, responsible parties that wish to market and
sell E15 could take advantage of Survey Option 1 to reduce the required
number of samples. On the other hand, increasing the minimum number of
samples does not provide much more information given the large number
of samples already required and the substantial increase in costs that
a larger number of samples would entail, which would pose an
unnecessary burden on responsible parties. However, as part of the
survey plan approval process, EPA will consider whether a higher
minimum sample size may be methodologically necessary under some
circumstances to maintain the rigor of a nationwide survey program. In
the regulations issued today, EPA is finalizing the sample size
methodology and minimum sample size of 7,500 samples per year as
proposed.
One commenter questioned whether proof that a surveyor had been
paid must be sent to EPA by the proposed deadline since EPA could bring
an enforcement action under the Clean Air Act if the survey was not
conducted according to the approved plan. The Agency believes that the
requirements that the survey plan be contracted and paid for in advance
are important to ensuring that the required surveys will occur.\17\ EPA
has made this a requirement of both the RFG and ULSD survey programs,
and the cost of providing proof of payment to the Agency is minimal.
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\17\ Contracting and paying for a survey also mark commencement
of a survey for related regulatory purposes.
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EPA is making changes to the survey provision governing revoking
approval of a survey plan to more closely conform to the method
provided for in the ULSD regulations \18\ of ensuring that survey plans
serve their intended purpose and that this goal is fulfilled until the
expiration of the plan.\19\ Given the importance of a robust survey for
effective implementation of ethanol content, labeling and related
[[Page 44424]]
requirements, if experience with an approved survey plan proves that it
is inadequate in practice, EPA may revoke it. Before deciding whether
to revoke a plan, EPA will generally work with the submitter to make
changes necessary to remedy the plan's flaws. If satisfactory
amendments cannot be achieved, EPA may decide to revoke its approval of
the survey plan. In the event a survey plan is revoked, distribution of
the E15 authorized for introduction into commerce under the E15 partial
waivers based, in part, on the survey plan would have to cease until
such time as a replacement survey is approved.
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\18\ See 40 CFR 80.613(e)(10)(v) and 80.613(e)(12).
\19\ These provisions apply to surveys approved under options 1
or 2.
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To ensure that the E15 survey provisions create incentives similar
to those created by the ULSD program for developing and implementing
effective survey plans, the regulations being promulgated today include
a provision for voiding a survey plan ab initio under appropriate
circumstances. If EPA determines that approval of a survey plan was
based on false, misleading or incomplete information, or if there is a
failure to fulfill or cause to be fulfilled any requirements of the
survey, EPA may void ab initio the approved survey plan. EPA's years of
experience in approving applications that authorize distribution of
motor vehicles, nonroad vehicles and engines, and fuels based on
compliance with applicable Agency regulations confirm the importance of
basing approval determinations on information that is true, clearly
stated and comprehensive, and on ensuring implementation of the terms
of the application. Given the importance of E15 surveys to effective
implementation of E15 misfueling mitigation measures, providing that
survey plans may be voided ab initio under appropriate circumstances
will help ensure that plans are properly developed, supported and
implemented. E15 distributed based on a plan whose approval was secured
with false, misleading or incomplete information, or a plan whose
requirements are not fulfilled, was not distributed in compliance with
the conditions of the waiver.
In considering whether it is appropriate to void a survey plan ab
initio, EPA will review the information that was submitted in support
of the plan. EPA will regard information that is not true to be false
information; information that, while true, may lead a reasonable person
to an incorrect conclusion to be misleading information; \20\ and
information that is missing elements necessary for a full understanding
of the information that was presented to be incomplete information.
Survey plans with these kinds of information flaws are inherently
unreliable, and effectively prevent EPA from conducting a meaningful
review of the survey plan and from basing its decision to approve the
plan on complete and accurate information. Thus, when EPA discovers
that its approval of a survey plan was based on false, misleading or
incomplete information, EPA may decide to treat its approval as never
having been granted. In addition, as discussed above, EPA is requiring
proof of a valid contract for conducting the survey and payment for the
survey to be provided to EPA to help ensure that the survey is
implemented. If, despite the fact that EPA receives this proof, the
requirements of a survey plan are not fulfilled, EPA may treat the
survey plan as never having been granted by voiding it ab initio.
Distribution of E15 under any survey plan that is voided ab initio
would have to cease until such time as a replacement survey is
approved, and E15 that was distributed based on that plan will be
deemed to have been distributed in violation of 40 CFR 80.1504(a)(2).
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\20\ For example, a plan implemented by a survey association
that is misleadingly described in the plan as independent of and
free from obligation to ethanol blenders and producers, gasoline
refiners and ethanol and gasoline importers or their employees, but
which is in fact not independent of or free from such obligation,
yields survey results that are inherently unreliable. Such a plan
may be voided ab initio.
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2. Final Survey Requirements
In today's rule, EPA is finalizing both survey options. After
carefully considering all of the comments received pertaining to the
survey requirements, EPA is finalizing Survey Option 1 as proposed. In
additional, EPA is finalizing most elements of Survey Option 2 as
proposed. However, Survey Option 2 as finalized does not require RVP
testing of fuel samples from pumps not labeled for E15, and provides
more time for the shipping and testing of samples. Finally, EPA is
revising provisions to permit both revoking and voiding ab initio
approval of survey plans in appropriate circumstances.
E. Program Outreach
In the NPRM we pointed out that a public education and outreach
program for E15 will be important to help mitigate misfueling that
could result in increased emissions and vehicle or engine damage. We
also noted that the industry-lead outreach campaign for the ULSD
program helped successfully transition the nation to ULSD while
mitigating most misfueling.
Almost all commenters agreed that an effective outreach program
would be essential to mitigate E15 misfueling, and some cited the ULSD
outreach effort as an example of how EPA and affected stakeholders
could work together to aid in the transition to E15 and minimize
misfueling. Recommendations included a dedicated Web site, use of EPA's
online Green Vehicle Guide, use of other media, pamphlets at retail
outlets, and consumer interaction via keypad entry at the pump. There
were also comments that EPA should establish and lead the outreach
program.
EPA agrees that public outreach and consumer education are key to
effectively mitigating misfueling. However, we believe that industry
needs to take the lead in such efforts. Our recent experience with the
transition to ULSD shows that a stakeholder-led outreach campaign can
work synergistically with labeling requirements and provide another
means of providing important information to everyone involved in fuel
production, distribution and use. The ULSD outreach program also shows
that industry is better situated to coordinate with the parties
involved in the production, transport, and marketing of E15. More
importantly, businesses interact with consumers (via advertising, a Web
site, pamphlets, etc.) about the fuels they sell, and those that decide
to sell E15 will need to make decisions about how to promote E15 in a
manner that also minimizes misfueling. As noted previously, the
introduction of E15 into the market is likely to start in a limited
number of areas and grow over time. In these circumstances it is even
more appropriate that the parties who choose to market this product
take the lead in outreach and consumer education in the areas the
product is introduced.
In light of these considerations, EPA believes that primary
responsibility for public outreach and education about E15
appropriately rests with the businesses that decide to make and sell
E15. As we did for the ULSD program, we intend to actively assist in
the development and implementation of an outreach and education
campaign for E15 when it enters the market. We are already in the
process of working with ethanol and other stakeholders to help
establish such a campaign. As that process moves forward, we will help
ensure that a broad range of stakeholders are kept informed so they may
become involved as they see fit.
F. Other Misfueling Mitigation Measures
In the proposed rule, we explained our expectation that the
misfueling
[[Page 44425]]
mitigation provisions we were proposing would adequately address
misfueling mitigation concerns. We based our expectation on the
relatively recent transition to ULSD when similar measures were
employed to help minimize misfueling of new vehicles and engines that
were designed and built to achieve stringent emission standards when
operated on ULSD. However, we also recognized that there could be other
means for addressing misfueling, as suggested by API in its misfueling
mitigation measures scoping study.\21\ In the NPRM, we discussed
several suggestions covered in API's study and sought comment on those
and any other measures that industry or other stakeholders considered
necessary or helpful to mitigate misfueling with E15.
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\21\ ``Evaluation of Measures to Mitigate Misfueling of Mid- to
High-Ethanol Blend Fuels at Fuel Dispensing Facilities,'' American
Petroleum Institute, EPA Docket EPA-HQ-OAR-2010-0448.
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We received many comments recommending that EPA implement or study
one or more mitigation measures in addition to those we proposed. This
section contains a brief summary of major comments and our responses to
those comments. It begins with a discussion of the general issue of
whether the proposed misfueling mitigation measures are sufficient to
mitigate misfueling, and then considers several specific measures
suggested by commenters for inclusion in today's final rule. Responses
to comments not addressed in this section can be found in the ``E15
Misfueling Mitigation Measures Response to Public Comments.''
1. Need for More Mitigation Measures
Many commenters expressed strong concern that the proposed suite of
misfueling mitigation measures would not be sufficient to minimize
potential misfueling with E15. They took issue with EPA's comparison of
the potential for misfueling with E15 to the potential for misfueling
under EPA's ULSD program, and contended that the more instructive
comparison is to the transition to unleaded fuel, where EPA required
additional mitigation measures.
The commenters generally argued that the transition to ULSD did not
provide the best or most appropriate point of reference for designing a
misfueling mitigation program for several reasons. First, EPA
regulations required that ULSD replace low sulfur diesel (LSD) fuel
over several years, whereas, according to the commenters, E0, E10, and
E15 will coexist in the marketplace for an indefinite period,
increasing the likelihood of misfueling. Second, the commenters noted
that the potential harm from LSD was to newer engines equipped with
advanced emissions control devices, while the potential harm from E15
is to older vehicles and engines. For ULSD, they noted there was
opportunity for vehicle manufacturers to educate new diesel vehicle
consumers at the time of purchase about the risks of misfueling, with
this information reinforced in the owner's manual and on the vehicles
themselves. For E15, the commenters explained, there is no similar
opportunity for consumer education. While the commenters acknowledged
that vehicle turnover will decrease the number of MY2000 and older
light-duty motor vehicles in the U.S. vehicle fleet, they stated that
the rate of vehicle turnover is decreasing as vehicle quality and
durability have improved and will take decades to complete.
Representatives of boat manufacturers and owners also noted that many
larger boats have longer useful lives than passenger vehicles. A third
reason for concern, according to commenters, is that E15 may be priced
less than E10 or E0, adding a cost incentive for misfueling.
Many of these commenters contended that the transition to unleaded
gasoline was at least as relevant to the design of E15 misfueling
mitigation measures as the transition to USLD. (Similar to the
transition to ULSD, the transition to unleaded gasoline occurred as a
result of new emission standards that required new emission control
equipment that would be irreversibly damaged by lead in gasoline.) The
commenters noted that the measures established to reduce misfueling of
new motor vehicles with leaded gasoline included physical constraints--
specifically, vehicle fuel inlets and gasoline nozzles designed so that
new vehicles requiring unleaded gasoline could only accept nozzles
dispensing unleaded gasoline. The commenters pointed out that even
these constraints did not prevent all misfueling, particularly when
leaded gasoline was priced less than unleaded gasoline.
After carefully considering these comments, EPA continues to
believe that the comparison to the ULSD program is valid and provides
an appropriate basis for designing the E15 misfueling mitigation
program. LSD and ULSD were available in the market at the same time for
several years, just as E15 is expected to be available along with E10
and/or E0 for a number of years. In the case of both USLD and E15, the
potential for engine damage and associated repair costs exists if
misfueling occurs. EPA believes that consumers have a strong interest
in avoiding repair and replacement costs, whether their vehicles or
gasoline-powered equipment are new or old. Owners may expect to get
less use from their older vehicles and equipment, but that does not
mean that they will put their possessions at risk, absent a strong
price incentive (discussed below). An essential element of a misfueling
mitigation program is alerting consumers to that risk. For ULSD, pump
labeling was important for notifying consumers of newer vehicles and
engines of the need to use ULSD and the consequences of misfueling. The
E15 label will serve the same purpose for owners of older motor
vehicles and other products for which E15 is not allowed. For ULSD,
industry established the Clean Diesel Fuel Alliance to educate diesel
product consumers about the importance of avoiding misfueling with LSD.
EPA is working with E15 stakeholders to help establish a similar public
education effort for E15. Overall, the transition to USLD posed
misfueling issues similar to those that will be raised by E15's entry
into the market, making the misfueling mitigation measures employed in
the ULSD program appropriate models for mitigating misfueling with E15.
Commenters did not provide sufficient evidence or rationale to
persuade us that use of physical constraints to prevent misfueling with
leaded gasoline means that similar, physical measures are necessary for
E15. A key difference between E15 and leaded gasoline is that
misfueling with E15 could result in driveability and operability issues
with older motor vehicles and nonroad equipment, while unleaded
gasoline did not affect the driveability of vehicles designed to run on
leaded gasoline. The E15 label will inform consumers that misfueling
with E15 may cause damage, and a public education effort can reinforce
that message. Also, consumers today have more and easier access to more
information about how to maintain their vehicles for best performance
and durability.
Another factor that contributed to misfueling with leaded gasoline
was the perception that the higher octane of leaded gasoline, typically
89 anti-knock index (AKI) versus 87 AKI for most unleaded gasoline,
made leaded gasoline a better fuel. An even stronger factor was price.
Leaded gasoline was typically five or more cents per gallon cheaper
than unleaded gasoline, at a time when gasoline was less than a dollar
per gallon. With the perception of
[[Page 44426]]
no harm from misfueling and the loss of higher octane, some consumers
saw no reason to spend the extra money on unleaded gasoline. Such is
not the case for E15. Depending on the availability of ethanol, which
can vary by season, E15 could be priced somewhat more or less than E0/
E10 with a comparable octane. Considering the extent that recent
gasoline prices have fluctuated, it does not seem likely that consumers
would risk damaging their vehicles or equipment for small incremental
savings. Public outreach can also help remind consumers of the cost
consequences of misfueling.
At the same time, we agree that if E15 is priced less than E10 or
E0, the risk of misfueling may increase if consumers believe that they
can save more money by purchasing E15 and do not consider or believe
the savings are more than they would pay to repair or replace their
vehicles or equipment sooner than might otherwise occur. However, it is
too early to know how E15 will be marketed, including how it will be
priced. EPA will work with stakeholders to monitor the transition to
E15 and the effectiveness of the mitigation measures being required by
today's rule. In the meantime, it is worth noting that the prohibition
against misfueling with E15 is applicable to both fuel providers and
users. As discussed later in this notice, retailers can avoid liability
for consumer misfueling if they properly label E15 pumps and can show
that they did not encourage or otherwise cause misfueling. In general,
fuel providers are encouraged to consider whether their particular
circumstances would make it useful to take additional, tailored steps
to avoid consumer misfueling.
In sum, as with the ULSD program, we believe that the misfueling
measures being finalized today for E15 will work together so that fuel
providers have a strong incentive to properly blend and label E15 and
consumers have a strong incentive to avoid misfueling. An industry-led
public outreach campaign can reinforce how and why it is important to
avoid misfueling.
In evaluating the need for additional mitigation measures, we also
considered the fact that there is currently significant uncertainty
about where, when and how E15 will enter the market. While the partial
waiver decisions removed one legal barrier to introducing E15 into
commerce, other steps must be taken to address additional Federal,
State and local requirements, including registering the fuel as
required by the Clean Air Act and determining the compatibility of fuel
storage and dispensing equipment under various Federal, State and local
regulations. Ultimately, businesses must decide whether and how to
introduce E15 into the market. We expect that the transition to E15,
like the transition to E10, will take time and begin in some parts of
the country before becoming broadly available. In the process, business
decisions will be made about how to market E15 (e.g., price of E15, its
use for a particular grade of gasoline, types of pumps used to dispense
it) that will bear on what, if any, additional measures may be useful
to mitigate misfueling, including the specific suggestions assessed
below. In light of these various considerations, we have concluded that
it is neither necessary nor appropriate to require additional
misfueling mitigation measures as part of today's final rule.
As the transition to E15 occurs, we plan to work with industry,
state, environmental and consumer stakeholders to track developments
and evaluate the effectiveness of the required misfueling mitigation
measures. As noted previously, we are working with ethanol and other
stakeholders to help establish a public education and outreach campaign
to assist fuel producers, distributors, retailers and consumers in
understanding how E15 may be made, distributed, sold and used. That
effort can also help identify and resolve misfueling issues that may
develop as E15 moves into the marketplace. In the meantime, if fuel
providers believe additional measures will further reduce the risk of
misfueling under their particular circumstances, they may take such
actions. For example, retailers that serve a significant population of
boat or small equipment owners may decide it is appropriate under their
specific circumstances to post signs that specifically address
misfueling of those products. By taking additional tailored steps,
retailers and other fuel providers can provide examples of other
measures that may prove effective in further reducing the risk of
misfueling.
2. Specific Suggestions for Additional Mitigation Measures
We examined the feasibility and utility of several specific
misfueling mitigation measures suggested by public commenters for
adoption in the final rule. As described below, each of the suggestions
presents implementation, feasibility or cost issues. There is also
little empirical data about the relative effectiveness of these
measures. Given the uncertainties about the transition to E15 and the
need for and effectiveness of the suggested measures, we have concluded
that it is not appropriate to require them at this time, although fuel
providers are encouraged to develop and deploy these and other measures
as they deem appropriate for their circumstances.
a. Distinctive Hand Warmers for E15 Dispensers
As discussed in the NPRM, the American Petroleum Institute (API)
study considered the use of different colored ``hand warmers'' or
``nozzle grips'' (the flexible plastic sheath that covers the part of
the pump nozzle that is gripped when dispensing gasoline) to
distinguish E15 fuel dispensers from other fuel dispensers. A number of
commenters recommended the adoption of such hand warmers, suggesting
that EPA require E15 hand warmers to be a uniform and unique color and/
or texture nationwide to indicate to consumers that E15 is different
than other gasoline and not appropriate for all motor vehicles. Some
commenters also suggested complementary signs to highlight the
distinctive hand warmer.
We carefully considered the workability and utility of this
measure. Hand warmers are low cost and are replaced periodically, so
this option could be relatively inexpensive and easy to implement.
However, this option could be challenging to implement for a number of
other reasons. First, there is no industry standard color scheme for
hand warmers. An assigned color for E15 hand warmers could conflict
with, or be confusing in the context of, retail stations' existing
color schemes. To address this issue, we considered whether to require
E15 hand warmers with a noticeably different texture or bearing the
text ``E15.'' However, there is currently no available data for
determining whether or to what degree such differences would be
effective in drawing consumers' attention more than the required label
itself.
We also identified another implementation challenge concerning
pumps that use a single nozzle to dispense multiple grades of gasoline.
Many existing pumps use a single nozzle to dispense multiple grades of
gasoline, such as regular grade (e.g., 87 octane), premium grade (e.g.,
92 octane), and a mid-grade (e.g., 89 octane). Consumers push a button
to select the grade of gasoline desired and then use the single nozzle
to dispense the fuel selected. It is likely that E15 may be marketed as
one, but not all, grades of gasoline, especially in the near term.
Requiring an E15 hand warmer on the nozzle of these pumps could be
misleading or confusing to consumers if the dispenser supplies not only
E15 but also E10 or E0.
[[Page 44427]]
In light of these issues and the lack of information about the
effectiveness of uniquely colored or textured hand warmers, we have
concluded that it is not appropriate to require this measure in today's
final rule. At the same time, we think distinctive hand warmers might
prove useful in many circumstances, and we encourage retailers to
consider whether their use might provide customers with a useful visual
or textual cue given their stations' pump types, color schemes or other
relevant attributes.
b. Keypad/Touch Screen Information/Confirmation
Some commenters stated that EPA should require all fuel pumps
dispensing E15 to require affirmative confirmation from consumers that
they wish to purchase E15. The commenters suggested this could be
accomplished through a mandatory electronic keypad approval (tied to
fuel grade selection), in which the consumer would need to confirm the
use of E15 prior to purchase. Some commenters argued that the sale of
E15 should be prohibited from pumps that do not have an electronic
keypad. Commenters favoring this measure did not provide specific
information about how affirmative confirmation using electronic keypads
or touch screens could be implemented.
EPA agrees that requiring affirmative confirmation from consumers
before they fuel with E15 could help consumers avoid misfueling with
E15. However, based on the limited information provided by commenters,
it does not appear that this measure could be implemented using
available technology or software. The electronic keypad used for
credit/debit card transactions do not generally interface with the fuel
selector such that the pump can be locked if the consumer makes an
inappropriate selection. Providing an interactive process for selecting
E15 would likely require substantial upgrades to the point-of-sale
system of the dispensers. We have therefore decided that available
information does not support requiring this measure at this time.
However, retailers may develop and implement keypad-based methods for
providing consumers with further information or opportunities to make
appropriate fuel choices.
c. Radio Frequency Identification (RFID)
Some commenters suggested the use of RFID technology as another
misfueling mitigation measure. RFID technology is already used in fuel
dispenser activation and purchasing systems. For example, one oil
company uses RFID technology in a tag or card that provides a
``contactless'' payment system that provides members with a quick way
to pay for purchases at participating stations. The tag has a built-in
chip and radio frequency antenna that allows it to communicate with
readers at gasoline dispensers.
For this option to be useful in mitigating misfueling with E15,
MY2001 and newer motor vehicles would need to be retrofitted with an
RFID device that allows E15 to be dispensed into the motor vehicle.
Some commenters indicated that the device installation is relatively
simple (for example, a consumer could have a device installed during an
oil change). One commenter estimated the cost of an RFID ring tag to be
$50-75 and installation of the tag around the fuel inlet to be $12.50.
Retrofitting of fuel dispensers with a companion RFID device would
raise larger cost and implementation issues. One commenter indicated a
cost of $500 for installing an RFID reader per fuel dispenser nozzle
and $10,000 to $20,000 to install a central controller per facility per
dispenser to upgrade software for security purposes.
Based on the information provided, this measure, while potentially
effective, raises a number of significant issues. First, it would
require the owners of MY2001 and newer light-duty motor vehicles, which
can lawfully use E15, to spend time and money to install devices so
that owners of vehicles and equipment that cannot lawfully use E15
cannot dispense E15 into those vehicles or equipment. Second, it is not
clear whether or how consumers could be persuaded or required to
install the RFID technology. Third, the cost to retail stations would
likely be considerable. Particularly given the uncertainties about the
transition to E15, it seems highly unlikely the benefits of this
measure would outweigh its costs. In light of these issues, we
determined that adoption of this measure would be inappropriate.
d. Requiring the Continued Availability of E10 and/or E0
Several commenters urged EPA to require the continued availability
of E10 and/or E0, arguing that EPA should adopt regulatory requirements
now to ensure that owners of older motor vehicles and other gasoline-
powered engines, vehicles, and nonroad equipment not covered by the E15
partial waiver decisions can find the fuel they need. In addition, on
March 23, 2011, EPA received a petition for rulemaking requesting that
EPA promulgate a rule under Clean Air Act section 211(c) to ensure the
continued availability of gasoline containing 10 vol% or less ethanol
(``<=E10'') at retail stations for use in vehicles, engines, and
nonroad equipment not covered by the E15 partial
waivers.22 23 Both the commenters and the petitioners noted
that E10 has, over time, largely displaced E0 in the marketplace, and
in some areas of the country, it is already difficult to locate E0.
They expressed concern that E15 could similarly displace E10,
particularly if economic factors and the Renewable Fuel Standard result
in broad adoption of E15. They argued that unless E10 remains
available, owners of vehicles and gasoline-powered engines, vehicles,
and nonroad equipment for which E15 is not allowed may have no choice
but to misfuel with E15. Petitioners also contend that EPA's proposed
misfueling mitigation measures will not be effective unless EPA ensures
that <=E10 remains available alongside E15. Petitioners point out that
EPA required availability of unleaded gasoline and USLD to protect
emission control systems, and they ask EPA to similarly require the
availability of E10 to protect the performance of emission control
systems of vehicles, engines, and nonroad equipment not covered by the
E15 partial waiver decisions.
---------------------------------------------------------------------------
\22\ ``Petition for Rulemaking Under the Clean Air Act to
Require the Continued Availability of Gasoline Blends of Less Than
or Equal to 10% Ethanol,'' Alexander David Menotti, Kelley Drye &
Warren LLP on behalf of American Motorcyclist Association (AMA), et
al., EPA Docket EPA-HQ-OAR-2010-0448.
\23\ On May 27, 2011, EPA received comments opposing the
petition from the National Association of Convenience Stores and the
Society of Independent Gasoline Marketers of America. These comments
are summarized in the Response to Comments document located in the
public docket.
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For the reasons discussed below, the Agency is not requiring the
availability of E10 (or E0) in this rulemaking and is also denying the
rulemaking petition. Based on the information currently available to
the Agency, we find that it is neither necessary nor appropriate to
issue such regulations at this time or to initiate a rulemaking process
to adopt them. While EPA appreciates that the availability of
appropriate fuels is important to mitigating misfueling, it is
premature for EPA to try to forecast now how E15 will be distributed
and marketed over the next several years, and how this might impact the
availability of <=E10. In considering the future availability of <=E10,
it is important to remember that EPA's partial waiver decisions allow,
but do not require, E15 to be sold. Instead, the partial waivers remove
a statutory prohibition on introducing E15 into commerce, subject to
misfueling
[[Page 44428]]
mitigation and other conditions. It is now up to businesses to decide
whether and how to produce and sell E15 for MY2001 and newer light-duty
motor vehicles. Further, before E15 can be legally sold and made
broadly available for these vehicles, a number of additional steps must
be taken by fuel producers, distributers, and marketers as well as
Federal, state and local government agencies. These steps include
registering E15 as a motor vehicle fuel under the Clean Air Act,
addressing the compatibility of E15 with fuel storage and dispensing
equipment, and potential changes to state and/or local requirements. In
light of these additional steps, EPA expects that any significant
market shift to E15 will take several years or more, and that the
decisions fuel providers will make about the continued availability of
<=E10 will largely determine if any availability requirement is needed.
Since <=E10 is widely available now, the appropriate response to any
future <=E10 availability issues will best be determined by evaluating
the distribution and market circumstances of E15 and <=E10 fuels as E15
enters the market. EPA will work with stakeholders to monitor those
circumstances and timely address any <=E10 availability issues that are
based on those specific circumstances.
Commenters and petitioners did not provide data that suggest that
<=E10 will be unavailable in either the short- or long-term, nor did
they provide quantitative analysis or evidence to support claims that
E15 will be less expensive than E10. This is significant since, as
explained above, it is not EPA that determines whether, how, or where
E15 will be distributed and sold, or how this will impact availability
of <=E10. It is the fuel industries involved that will determine the
role that E15 plays in the fuel distribution system and how this will
affect availability of <=E10. Without commenters and petitioners
providing data to support their assertions, EPA can only consider
available information, which shows that it is far from a foregone
conclusion that E15 will result in a scarcity of <=E10 in the next
several years or more. Under the E15 partial waivers and the misfueling
prohibition in today's rule, E15 may be used only in MY 2001 and newer
light-duty motor vehicles and FFVs. Gasoline containing no more than 10
vol% ethanol will continue to be needed for fueling MY2000 and older
light-duty motor vehicles and all heavy-duty gasoline vehicles and
engines, motorcycles and nonroad equipment. EPA estimates there are
over 240 million such vehicles, engines, and nonroad equipment in
existence today, and even as some products are retired, new heavy-duty
gasoline-powered vehicles and engines, motorcycles, and nonroad
equipment will be purchased. In view of the continuing demand for
<=E10, EPA expects that many retailers will continue to make <=E10
available. Also, as noted above, retail stations that decide to sell
E15 will need to address the compatibility of fuel dispensers and
underground storage tank systems with E15, which could affect the pace
of E15's entry into the marketplace. According to some commenters,
gasoline producers may need to change fuel formulations to accommodate
the use of E15, which could further impact the availability and cost of
E15 relative to <=E10. In short, many factors affect the timing and
extent of the availability of E15 and any impact on the continued
availability of <=E10. At this time, EPA cannot forecast how decisions
will be made by the various industries involved and is not in a
position to evaluate either the detailed scope of any future issues
concerning availability of <=E10 or the appropriate regulatory
response.
Commenters and petitioners stated that EPA has the legal authority
under Clean Air Act section 211(c) to require the availability of
<=E10. Under section 211(c), EPA may control or prohibit fuels and fuel
additives that cause or contribute to air pollution that may endanger
public health or welfare or significantly impair emission control
devices or systems. Those controls may include, where justified,
requiring the availability of particular fuels needed to ensure the
continued effectiveness of emissions control systems. However, to
require <=E10 availability, EPA would need to conduct a number of
analyses, including of the costs, small business impacts, and
environmental and other benefits of such a requirement. CAA section
211(c), the Regulatory Flexibility Act, and various Executive Orders
pertaining to rulemaking call for analysis of various factors before
proposing and adopting regulations such as a fuel availability
requirement under section 211(c). Petitioners requested that EPA
require that <=E10 be made available at any retail gasoline station
that offers gasoline containing greater than 10 vol% ethanol. However,
petitioners provided no quantitative or qualitative data necessary to
analyze the important issues that are relevant for establishing this
kind of requirement. For example, petitioners did not show that the
requirement is necessary to avoid misfueling based on an analysis of a
reasonable projection of the future volumes and marketing patterns of
E15 and <=E10 fuels in the future. Petitioners also provided no
information on how the costs of such a requirement would compare to the
benefits, under the same volume and marketing projections. Without such
information, the Agency cannot justify placing potentially costly
requirements on small businesses (e.g., the thousands of independently
owned and operated gasoline retail stations) or require that the fuel
distribution system maintains storage capacity for <=E10 (e.g.,
potentially requiring that terminals provide additional tanks to store
more blendstocks). Indeed, given the many uncertainties that exist
concerning the future availability of E15, E10 and E0, it would be
difficult, if not impossible, to conduct the required analyses in a
meaningful way at this time.
EPA raises these points not to discount the important issues raised
by the petitioners and commenters, but to indicate the kind of analysis
that would be needed to evaluate either the suggested regulatory
approach or other less comprehensive regulatory requirements, and to
highlight the premature nature of taking regulatory action at this
time.\24\ Until E15 enters the market and further developments take
place, much of the information needed to conduct those analyses will be
unavailable or difficult to obtain. Better, well-informed decisions can
be made by monitoring developments concerning the availability of E15
and <=E10 and formulating any EPA response in light of specific
developments as they occur over time.\25\
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\24\ In addition, EPA notes that there would be serious notice
and comment concerns if EPA attempted to adopt any regulatory
requirement on availability in this final rule.
\25\ Given EPA's many statutory responsibilities, we also
conclude that it does not make sense to use EPA's limited resources
to attempt to develop information or make projections now where much
more reliable information will become available over time, nor is it
appropriate to undertake a rulemaking now that imposes specific
requirements that could well be unnecessary in light of future
developments.
---------------------------------------------------------------------------
Contrary to petitioners' assertions, the circumstances that led EPA
to ensure the availability of unleaded and USLD fuels are substantially
different from those of any transition from E10 to E15. In the case of
both the lead phase-down and the ULSD programs, a new fuel was needed
to protect the advanced emission controls of new vehicles and engines.
The predominant fuels on the market at the time (i.e., leaded gasoline
and 500 ppm sulfur diesel fuel) would have damaged those controls, so
it was important for EPA to ensure the availability of new fuels that
would allow the advanced emission controls to
[[Page 44429]]
work properly.\26\ Here, commenters and petitioners are asking for
regulatory assurance that the currently predominant fuel on the market
remains available. Because we expect, for the reasons discussed above,
that E10 will remain the predominant fuel for some time, and is likely
to remain available for a long period of time in response to market
demand for the fuel, we do not believe it is appropriate to require the
availability of <=E10 at this time.
---------------------------------------------------------------------------
\26\ For lead phase-down, EPA required the availability of
unleaded gasoline to replace leaded gasoline because use of unleaded
gasoline was necessary to the proper operation of the catalytic
converters equipped on new motor vehicles. With the ULSD program,
refiners were required to produce ULSD because it was needed for
proper operation of the advanced emission control technologies with
which MY2007 and newer diesel engines would be equipped. There was
no availability requirement for ULSD, but the rule was designed in
such a way to ensure an adequate supply and distribution of ULSD for
the new heavy-duty vehicles that would need it.
---------------------------------------------------------------------------
The petitioners also incorrectly assert that the E15 misfueling
measures finalized in today's action will supersede the waiver
conditions. In fact, as discussed in section IV.G, today's requirements
are not a substitute for the waiver conditions, although they should
help responsible parties satisfy some of the conditions. Fuel and fuel
additive manufacturers must still satisfy all waiver conditions before
E15 may be introduced into commerce. This includes submitting plans
that detail how a fuel or fuel additive manufacturer will ensure that
misfueling does not occur. To the extent E10 becomes scarce and would
not be reasonably available to consumers, plans submitted under the
waiver may be an avenue for addressing the issue. In the future EPA
would evaluate that approach as well as any potential regulatory
approach under section 211(c).
As discussed above (see section III.F.1), EPA believes that the
misfueling mitigation measures included in today's action will
appropriately and effectively reduce the potential for misfueling.
Those measures include a misfueling prohibition and an E15 label that
communicates that prohibition, along with the potential for damage to
vehicles and engines not covered by the partial waivers, to consumers.
With those measures in place, retailers, distributors, and consumers
are expected to obey the law and find fuel that is compatible with
their vehicles, engines, and equipment.
For the reasons discussed above, EPA is denying the petition for
rulemaking to require that gasoline-ethanol blends containing 10 vol%
or less ethanol be made available in the marketplace. As the transition
to E15 occurs, we will work with fuel producers, distributors, and
marketers to monitor the availability of E15, E10, and E0 so that any
potential problems can be anticipated and addressed on a timely basis,
based on real world conditions as they develop.
G. Modification of the Complex Model Regulations and VOC Adjustment
Rule
To measure compliance with the RFG and anti-dumping standards, the
emissions performance of gasoline is calculated using a model, called
the Complex Model, which predicts the emissions level of each regulated
pollutant based on the measured values of certain gasoline properties.
Currently, the amount of oxygen that can be used as input to the
Complex Model is limited to no more than 4.0 percent by weight (wt%) in
gasoline in which the oxygenate is ethanol. This level is equivalent to
the maximum amount of oxygen in gasoline containing 10 percent by
volume (vol%) ethanol, or E10.\27\
---------------------------------------------------------------------------
\27\ Because the percent by weight of oxygen in the fuel varies
depending on the density of the fuel, the limit in the Complex Model
is currently 4.0 wt% to reflect the maximum amount of oxygen
associated with E10. In most fuels, however, this quantity is
equivalent to 3.5 to 3.7 wt% oxygen.
---------------------------------------------------------------------------
The emissions level as computed by the Complex Model is compared to
the baseline emissions for each pollutant, and the percent reduction is
then calculated. The RFG standards for VOC, NOx, and toxics are stated
in terms of percent reductions from the baseline, whereas the
antidumping regulations applicable to conventional gasoline generally
require no greater emissions than baseline levels. Under the Clean Air
Act, baseline emissions must be based on 1990 vehicle technology, not
current fleets, nor off-road equipment. For gasoline to be sold in the
U.S., it must comply with either the RFG or antidumping standards, as
appropriate. Refiners are required to certify that their fuel meets the
standards by using the Complex Model. For the RFG areas of Chicago and
Milwaukee, RFG that contains 10 vol% ethanol is given an adjustment of
the VOC performance standard, resulting in a slightly less stringent
requirement.
1. Proposed Approach and Consideration of Comments
Because the Act specifies that the emissions performance for RFG is
to be measured against a baseline that represents 1990 vehicle
technology, we were not able to use current emissions test data on
motor vehicles using E15 gasoline as a basis for evaluating appropriate
changes to the oxygen input parameter of the Complex Model VOC
equation. Instead, we relied on a study conducted in 1994 by Guerrieri
et al. (Guerrieri/Caffrey study) that examined the exhaust emissions
from 1990 vehicles using gasoline with ethanol levels varying from 0 to
40 vol%.\28\ Based on the study findings, we are reasonably confident
that the average VOC emissions for ethanol blends greater than E10 up
to and including E15 will be no worse than for E10, for 1990 technology
motor vehicles.
---------------------------------------------------------------------------
\28\ Guerrieri, D., Caffrey, P., and Rao, V., ``Investigation
into the Vehicle Exhaust Emissions of High Percentage Ethanol
Blends,'' SAE Technical Paper 950777, 1995, doi:10.4271/950777.
---------------------------------------------------------------------------
This outcome is consistent with our engineering judgment. The
study's data showed that on average exhaust hydrocarbon emissions
increased from E10 to E12, but then decreased beyond E12. While the
study does not provide sufficient data to determine the precise VOC
emission effect between E10 and E15, the linear regression results
presented in the study indicate a decreasing trend in hydrocarbon
emissions with increased ethanol in gasoline. In the NPRM, we therefore
proposed to modify the regulations to allow gasoline fuels containing
greater than 4.0 wt% oxygen and up to 5.8 wt% oxygen to be certified
with the VOC emissions effects modeled the same as if the fuel
contained 4.0 wt% oxygen.\29\
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\29\ The level of 5.8 wt% oxygen is the potential maximum oxygen
level associated with E15 due to lighter than average gasoline
components. The typical weight of oxygen in E15 is around 5.2%.
---------------------------------------------------------------------------
Most comments received supported the proposed change to the Complex
Model regulations. Some commenters were concerned permeation effects,
the representation of NOX and toxic emissions by the Complex
Model, and whether the Complex Model should be modified to allow
increased oxygen levels from all renewable fuels. Two comments also
suggested that the VOC adjustment that applies in Chicago and Milwaukee
for RFG containing nine to ten percent ethanol should be modified to
allow RFG that contains up to 15% ethanol to have the same VOC standard
as E10. We discuss these comments in further detail below.
a. VOC Emissions From Permeation
One commenter pointed out that with respect to the effect of
increased ethanol levels on VOC emissions, the Guerrieri/Caffrey study
examined only exhaust VOC emissions. Evaporative VOC emissions were not
investigated. The commenter pointed out that permeation emissions are a
concern with ethanol, and that the Complex Model should
[[Page 44430]]
reflect such emissions. The commenter stated, ``At a minimum, EPA must
conduct permeation testing on relevant fuel system materials to
determine how permeation rates vary with ethanol content (i.e., does
the rate change between E10 and E15). EPA should then modify the
Complex Model to reflect the change in permeation related evaporative
emissions from the zero percent ethanol baseline.''
We acknowledge that the referenced study did not address
evaporative emissions due to permeation. However, evaporative
permeation was not tested during development of the Complex Model.
Thus, the model never reflected permeation emissions for any level of
ethanol (E0, E10, E15 or any values in between). Recent data from CRC
show that although permeation emissions increase with higher levels of
ethanol, the effects of E15 are likely to be comparable to E10.\30\
Since the permeation rates of E15 are comparable to those of E10, it
would be inappropriate to modify the model to account for E15
permeation emissions and not for E10. Major changes to the Complex
Model such as would be needed to reflect permeation emissions for
different levels of ethanol are beyond the scope of this rulemaking.
Since evaporative permeation from E15 is comparable to that from E10,
we believe today's regulatory change to treat E15 like E10 under the
Complex Model is appropriate.
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\30\ Enhanced Evaporative Emission Vehicles (CRC Report: E-77-
2), March 2010, and Evaporative Emissions From In-Use Vehicles: Test
Fleet Expansion (CRC Report: E-77-2b), June 2010.
---------------------------------------------------------------------------
b. Representation of NOX and Toxic Emissions in the Complex
Model
One commenter expressed concern that the Guerrieri/Caffrey study
showed that NOX emissions on the six vehicles tested
increased with increasing levels of ethanol. The commenter suggested
that we therefore should modify the equations of the Complex Model to
account for such increases in NOX.
The NOX emission performance requirements for RFG and
conventional gasoline (CG) have not been applicable to most refiners
since January 1, 2007, when the Tier 2 gasoline average sulfur standard
of 30 ppm took effect (see 40 CFR 80.41(e)(2)(i) for RFG; and 40 CFR
80.101(c)(3)(i) for CG). This is the case for all refiners as of
January 1, 2011 (see 40 CFR 80.41(e)(2)(ii) for RFG; and 40 CFR
80.101(c)(3)(ii)). The applicability of the Complex Model to gasoline
certification has thus become limited as EPA's more recent clean
gasoline standards take effect and require even greater emission
reductions than those required by the RFG and antidumping programs. As
a result, there is no current NOX performance standard for
RFG or conventional gasoline under the RFG or antidumping regulations,
and the Complex Model is no longer used for modeling NOX
performance. Therefore, there would be no point in modifying the
Complex Model regulations to account for additional NOX
emissions that may be associated with E15.
The same commenter also raised concern over our approach to air
toxics. Specifically, in the NPRM, we stated that we would not need to
modify the air toxics standard of the Complex Model because beginning
January 1, 2011, the air toxics emission standards no longer apply for
gasoline subject to the new mobile source air toxic (MSAT2) nationwide
benzene standard for gasoline (see 40 CFR 80.41(e)(3) for RFG; and 40
CFR 80.101(c)(4) for CG). We noted, though, that small refiners can
take advantage of the option for delayed compliance with the MSAT2
benzene standard until January 1, 2015. We stated that since small
refiners typically certify CG as E0, with oxygenate blended downstream,
their compliance with the toxics performance standard should be
unaffected by the increase in ethanol content from E10 to E15. In
addition, no small refiners currently produce RFG or are expected to
produce RFG. Thus, there is no need to revise the toxics performance
standard of the Complex Model.
The commenter recommended that EPA revise the toxics standards of
the Complex Model to account for E15, and maintained that even if there
are currently no small refiners producing RFG, EPA cannot preclude the
possibility that they may do so in the future. However, to make the
relevant change to the Complex Model would be a major undertaking and
EPA continues to believe that such an undertaking is unnecessary and
unwarranted in light of current and expected practices by small
refiners. Furthermore, even if we were to make the suggested change,
any possibility of relevance would disappear effective January 1, 2015.
In light of these considerations, EPA has not modified its Complex
Model regulations to account for air toxics emissions related to E15.
c. Adequacy of the Guerrieri/Caffrey Study To Justify Modification of
the Complex Model Regulations
One commenter stated that the Guerrieri/Caffrey study that we used
to document the effects of increased levels of ethanol on exhaust VOC
emissions is inadequate. The commenter contended that the Guerrieri/
Caffrey study used six vehicles, whereas the original study used to
develop the Complex Model was based on 19 vehicles. In addition, the
commenter points out that the gasoline for the Guerrieri/Caffrey study
is not representative of the gasoline that is now sold, since neither
the low sulfur gasoline rule nor the MSAT2 rule was in effect at that
time.
With regards to the gasoline used in the Guerrieri/Caffrey study
not being representative, the gasoline used for the study to develop
the Complex Model was also different than today's. In fact, the
gasolines used for both the original Complex Model study and the
Guerrieri/Caffrey study were the same, providing some level of
consistency between them. Both were designed to reflect the statutory
baseline fuel for these standards--1990 fuel, not today's fuel.
Notwithstanding the relatively few vehicles tested, the Guerrieri/
Caffrey study provides data that allows EPA to estimate with reasonable
confidence what would be the likely effect on exhaust emissions of
blends of E15 in RFG as represented by the Complex Model. As stated in
the preamble of the NPRM, the outcome of that study was consistent with
our engineering judgment. That is, the general trend across vehicles of
all ages is that the addition of ethanol to gasoline tends to lower VOC
emissions due to its enleanment effect during open loop operation.
d. Representation of Other Renewable Fuels and Fuel Additives in the
Complex Model
We proposed modifying the Complex Model only for the increased
level of oxygen associated with E15. Two commenters suggested that the
modification not be limited only to ethanol but to all renewable fuels
and fuel additives that supply oxygen up to the new 5.8 wt% level. We
believe that this comment has merit, since the Complex Model treats the
parameter of oxygen independently of the oxygenate which supplies it.
In other words, the model was developed using fuel oxygen level as an
input independent of which oxygenate contributed the oxygen. In
addition, we believe that the increased use of any oxygenate in the
range of 4.0 wt% to 5.8 wt% would have effects on VOC emissions that
are similar directionally to those of increased ethanol use in that
range. Thus, we agree with the commenters that it is not necessary to
limit the higher levels of oxygen in fuel (i.e., above 4.0 up to 5.8
wt%) only to ethanol for purposes of modifications to the Complex Model
[[Page 44431]]
regulations. We will therefore modify the regulations to allow the
Complex Model to be run for fuels containing oxygen levels up to 5.8
wt% from any oxygenate. However, it should be noted that this change to
the Complex Model regulations has no effect on any other restrictions
applicable to such fuels. For example, this modification to the Complex
Model regulations does not relieve any party from the substantially
similar prohibition in section 211(f)(4) of the Clean Air Act or the
need, in appropriate circumstances, to receive a waiver of this
prohibition.
e. Modification of the VOC Adjustment for RFG in Chicago and Milwaukee
Two commenters pointed out that the regulations for RFG (40 CFR
80.41) currently allow for an adjustment of the VOC performance
standard for RFG containing between nine and 10 vol% ethanol in the
Chicago and Milwaukee RFG areas. For RFG sold in these areas, the
adjustment allows for a slightly lower emission reduction of VOCs as
computed by the Complex Model. The amount of this adjustment is
equivalent to a decrease in the RVP by approximately 0.3 psi. Since we
proposed to allow the Complex Model to accommodate ethanol in RFG up to
15 vol%, one commenter argued that we should also allow such blends to
be eligible for the VOC adjustment. The other commenter stated that
unlike the 1.0 psi waiver for conventional gasoline, the VOC adjustment
for RFG is not a statutory requirement and that ``the policy rationale
behind the adjusted standard for E-10 applies equally to E-15.'' The
commenter also stated that not extending the VOC adjustment in Chicago
and Milwaukee to E15 would present additional logistical and financial
challenges including the creation and storage of a lower RVP blendstock
for splash-blending E15.
The VOC adjustment rule was promulgated in 2001 when RFG had an
oxygen content requirement. E10 was typically used in the Chicago and
Milwaukee RFG areas, generally resulting in a higher oxygen content in
these areas than in other RFG areas. EPA's reasons for adopting the VOC
adjustment rule can be found at 66 FR 37164 (July 17, 2001). In
essence, at that time, EPA determined that, for purposes of ozone, the
higher oxygen levels in E10 led to greater reductions in CO which
offset to some extent VOC emissions. EPA reduced the VOC performance
standard for E10 consistent with this offset.
Today's rulemaking is limited to consideration of issues associated
with the entry of E15 into commerce. EPA is not in a position to
reevaluate, and is not reevaluating, whether the VOC adjustment
provision for E10 continues to be appropriate. The only issue before
EPA in this rulemaking is whether the existing adjusted VOC performance
standard for the Chicago and Milwaukee RFG areas should be extended to
E15. In addition, it should be noted that section 1504 of the Energy
Policy Act of 2005 (EPAct) requires that EPA remove the VOC performance
standards for VOC-Control Region 2 that are currently in 40 CFR 80.41,
and instead apply the standards in 40 CFR 80.41 for VOC-Control Region
1 for all RFG areas. When EPA implements this EPAct provision, it will
consolidate the northern and southern VOC performance standards for
RFG, adopting the southern VOC performance standards for all RFG areas.
At that point the adjusted VOC performance standard would no longer
apply in the Chicago and Milwaukee RFG areas. EPA intends to address
this EPAct provision in a future rulemaking. However, EPA is not in a
position to make these broad changes to the VOC performance standards
in this rulemaking, and is limiting this action to issues associated
with the introduction of E15 into commerce.
In that context, EPA believes it is appropriate to extend the
current adjusted VOC performance standard to E15. If the adjusted VOC
standard is extended and E15 is introduced into these RFG areas, it
will likely replace E10. EPA expects that the base blend of gasoline
would not change whether it is used to produce E10 or E15 RFG. By
replacing E10, E15 RFG would directionally lead to greater reductions
in VOC emissions in-use, as E15 produces a slightly lower increase in
RVP than E10. In addition, E15 would likely lead to greater reductions
in CO compared to E10, because of the increased oxygen content.
Extending the adjusted VOC performance standard to E15 would therefore
likely lead to somewhat greater reductions in VOCs and CO than would
occur if the adjusted VOC standard is not extended to E15. This
increase in emissions reductions is consistent with the provisions of
Clean Air Act Sec. 211(k)(1)(A), and starts to move at least
directionally in a manner consistent with the EPAct provision. As such,
it is appropriate at this time to make the narrow revision of extending
the adjusted VOC standard to E15.
2. Final Approach Concerning the Complex Model and the VOC Adjustment
Rule
For the reasons discussed above, EPA is revising the Complex Model
regulations generally as proposed. The equations in the Complex Model
relating to NOX and toxics will not be changed. The Complex
Model regulations will be modified to specify use in the model
equations of a 4.0 wt% oxygen content for fuels with actual oxygen
content greater than 4.0 wt% and up to 5.8 wt%. Thus, the VOC emissions
performance for these fuels shall be evaluated as if the oxygen content
were 4.0 wt% oxygen. Today's rule also modifies 40 CFR 80.41 so that
the VOC adjustment in effect for Chicago and Milwaukee will apply to
RFG with ethanol content between nine and 15 vol%.
H. Federalism Issues
In the NPRM, we discussed the potential federalism issues that the
proposed rule might raise. We noted that the proposed mitigation
measures were based on the authority in CAA section 211(c) as well as
the recordkeeping and information collection authorities of the Act. In
that context, we specifically discussed section 211(c)(4)(A), which
prohibits states and political subdivisions from prescribing or
attempting to enforce for purposes of motor vehicle emission control
any control or prohibition ``respecting any characteristic or component
of a fuel or fuel additive in a motor vehicle or motor vehicle engine''
if EPA has prescribed a control or prohibition applicable to such
characteristic or component of the fuel or fuel additive under section
211(c)(1). We explained that this prohibition does not apply to
controls that are identical to prohibitions or controls adopted by EPA
(section 211(c)(4)(A)(ii)) or to California (section 211(c)(4)(B)). We
also noted that a state may adopt non-identical fuel control measures
upon a showing of necessity under section 211(c)(4)(C).
In light of these CAA provisions, we indicated that we were not
aware of any state rules or laws that would be preempted by the
proposed rule if adopted. We explained that, to our knowledge, states
have not controlled ethanol volumes in gasoline for purposes of motor
vehicle emissions control. We also stated that the proposed rule, if
adopted, would not require states to change their existing labels.
We received a comment from a state agency agreeing with our
explanation of the scope and effect of the Federal preemption
provisions of CAA section 211(c) and noting the importance of state
regulation of fuel as allowed under the Act. Several commenters,
however, expressed concern about the potential
[[Page 44432]]
for state fuel regulations to create a patchwork of requirements, and
urged EPA to clarify that state laws cannot conflict with or undermine
any of EPA's control measures. In particular, these commenters stated
that EPA should specifically prohibit states from undermining the
effectiveness of the EPA warning label through requiring conflicting or
distracting ethanol labels.
Today's action is based on the authority in section 211(c)(1), as
well as under sections 208 and 114 of the Act. As such, today's action
leads to the express preemption of certain state actions that prescribe
or enforce controls or prohibitions respecting ethanol content in
gasoline, under section 211(c)(4)(A). Thus, because section
211(c)(4)(A) applies only to controls or prohibitions respecting any
characteristics or components of fuels or fuel additives for use in
motor vehicles or motor vehicle engines, i.e., on road or highway
vehicles, a state control or prohibition respecting ethanol content in
fuel or fuel additives would be preempted only if it is ``for purposes
of motor vehicle emission control.'' Further, states, other than
California, may prescribe and enforce non-identical measures if they
seek and obtain EPA approval of State Implementation Plan revisions
containing such control measures, under section 211(c)(4)(C).
Additionally, aside from the express preemption in section
211(c)(4)(A), a state control for fuels or fuel additives may be
implicitly preempted under the supremacy clause of the U.S.
Constitution where the state requirement actually conflicts with
Federal law by preventing compliance with the Federal requirement, or
by standing as an obstacle to accomplishment of the Federal objectives.
A state standard respecting ethanol content that is not subject to the
express exemption provisions of section 211(c)(4)(A) nevertheless may
be preempted because it meets the criteria for conflict preemption.
In light of the relevant statutory and constitutional provisions,
EPA believes that questions regarding preemption of specific state fuel
regulations should be addressed on a case-specific basis. Generally
speaking, state requirements related to ethanol can co-exist with the
misfueling mitigation provisions of today's rule, including, for
example, the requirement for the specified E15 pump label, where the
state requirements are not ``for purposes of motor vehicle emission
control'' and do not conflict or undermine the effectiveness of the
Federal misfueling mitigation measures.
IV. Other Issues Addressed by Commenters
A. Cost of Compliance
We calculated the proposed cost of compliance based on the periodic
capital costs of labeling fuel dispensers, the onetime costs of the PTD
requirements, and the annual cost of the survey requirements. The cost
of the proposed labeling requirements was estimated at $1.04 million
per year on an annualized basis. This estimate was conservative (tends
to overestimate costs) as it was based on a label being placed on all
pumps at all stations. Since we are requiring only labels at E15 pumps
and we did not receive information indicating that our cost estimate
for labeling was low, we are using the same estimate for the cost of
the labeling requirement for the final rule.
Our estimate for the cost of the proposed PTD requirements in the
NPRM was $0.56 million per year. We did not receive comments to the
contrary. We have revised this estimate to $0.45 million per year. The
revised estimate is based on a one-time cost of $4.1 million to
regulated parties to modify the formatting of their existing PTDs to
accommodate the new information which will be required as a result of
the rule. After the one-time modification of PTD formatting is
complete, we believe that there would be no significant additional
costs associated with communicating the additional information required
by today's rule to downstream parties in the distribution system
(either in electronic or paper form). By amortizing the one-time
reformatting costs over a period of 15 years at a 7% cost of capital,
we arrive at an annualized cost of $450,000 for the PTD requirements.
We estimated the cost to implement the proposed survey provisions
for conventional gasoline at $2 million per year and the cost of adding
the proposed survey requirements to the existing RFG survey at $50,000
per year. We also estimated that the cost of RVP testing of the samples
would be $200,000 per year. One commenter stated that EPA
underestimated survey costs because the proposed requirement for same-
day shipping would increase costs by as much as $1 million per year.
For the final rule, we have removed the requirement for expedited
shipping, so the basis for the commenter's concern is no longer
applicable. Since in the final rule we are requiring RVP testing only
of samples labeled as E15, we estimate that no more than $100,000 will
be necessary to complete such testing. Thus, the total cost of the
final survey requirements is estimated to be $2.15 million per year.
The total estimated cost of all the requirements is $3.64 million
per year, slightly lower than the $3.75 million we estimated in the
NPRM. We stated in the NPRM that the misfueling mitigation measures
would reduce the potential for misfueling and consequent emission
increases and repairs to nonroad products and MY2000 and older motor
vehicles. We also stated that while there are no data to estimate the
frequency at which emission increases and repairs or other potential
complications might occur with misfueling in the absence of today's
rule, even if these consequences were avoided for only a tiny fraction
of vehicles and equipment not covered by the partial waivers (as
opposed to actions taken independently by industry in response to
conditions on the partial waiver), the savings would still far exceed
the costs of compliance. In reaching this view, we considered the
avoided costs of repairing or replacing catalysts, although the costs
of other repairs and emission increases might also be avoided. We
expected that emissions-related consequences would occur with enough
frequency that the benefits of the proposed rule's requirements would
clearly outweigh the relatively low costs. See 75 FR 68044, 68058, 081
(Nov. 4, 2010). During the public comment period for the proposed rule,
additional information that might be useful to estimating costs or
benefits was not submitted and did not otherwise become available. As a
result, we continue to expect that the benefits of today's final rule
will significantly outweigh the rule's low costs.
One commenter stated that our analysis failed to consider the cost
for controlling the additional emissions from E15 at service stations,
as well as the potential impacts to ground water and the associated
costs of upgrading underground storage tank systems and the dispensers
that deliver the fuel to the motor vehicle. The commenter argued that
EPA must consider and include the costs associated with installing
equipment to protect ground water and the air from releases and
emissions due to any incompatibility of USTs and Stage I vapor recovery
equipment with E15. Specifically, the commenter stated that dispensing
E15 using Stage I and Stage II vapor recovery equipment at retail
gasoline stations could result in increased emissions, and noted that
currently no Stage I or Stage II equipment are listed as approved for
fuels beyond E10. Also, the commenter stated that EPA had not
considered the potential impacts to ground water
[[Page 44433]]
presumably from leakage of underground storage tanks in the event of
E15 incompatibility. The commenter, citing the results of the DOE's
National Renewable Energy Laboratory (NREL) report of November 12,
2010, stated that there are significant operational or material
incompatibilities between legacy equipment and E15. The commenter
asserted that the cost to replace a dispenser or an underground storage
tank that may leak and release product to the ground water should also
be included.
It is important to recognize that the cost impacts we are
evaluating for the final rule are the costs associated with
implementing the regulatory requirements established by the rule. These
regulatory requirements will apply only to the extent fuel providers
decide to make and sell E15. Neither the partial waivers nor today's
rule require that E15 be made or sold. Therefore, while some retail
stations may need to make upgrades in order to sell E15, the cost of
making any upgrades is not attributable to any regulatory requirement
adopted in this rule. If equipment upgrades are made as needed to
dispense E15, it will be because retailers decide to sell E15, not
because of a requirement to do so. We have therefore estimated the
costs of implementing the requirements adopted by this rule for
labeling, PTDs and surveys. While the commenter provided no information
on costs of potential equipment upgrades, we recognize that there may
be additional costs like those noted by the commenter associated with
distributing and selling E15. However, those costs are not relevant to
an evaluation of the costs of the requirements adopted in this
rulemaking.
B. The Applicability of the Statutory 1.0 psi RVP Waiver to E15
EPA proposed that CAA section 211(h)(4) should be interpreted ``as
limiting the 1.0 psi waiver [that the section provides] to gasoline-
ethanol blends that contain 10 vol% ethanol, including limiting the
provision concerning `deemed to be in full compliance' to the same 10
vol% gasoline-ethanol blends.'' 75 FR 68061. We explained that EPA
implements CAA section 211(h)(4) through 40 CFR 80.27(d), which
provides that gasoline-ethanol blends that contain at least 9 vol%
ethanol and not more than 10 vol% ethanol qualify for the 1.0 psi
waiver of the applicable RVP standard. We requested comment on whether
section 211(h) could be interpreted such that E15 would also be
eligible for the RVP provisions in section 211(h)(4). 75 FR 68081.
We received several comments arguing that section 211(h)(4) should
be read to apply to E15 and urging the Agency to amend the relevant
regulations to reflect this reading. Commenters argued that reading
section 211(h)(4) to extend the 1 psi waiver to E15 is consistent with
EPA's fuel volatility rulemakings and the provision's legislative
history and intent. Commenters pointed to the Agency's 1987 RVP
rulemaking for support, noting that the Agency allowed blends
containing gasoline and a minimum of 10% ethanol to exceed the RVP
limits by 1 psi (see 52 FR 31305 (August 19, 1987)) and that Congress
codified this approach in section 211(h)(4). The commenters argued that
a later EPA rulemaking allowing a range of gasoline-ethanol blends
(i.e., gasoline ethanol blends that contain at least 9 vol% and no more
than 10 vol% ethanol) instead of simply requiring exactly 10 vol%
ethanol was an indication of EPA's discretion in interpreting section
211(h)(4). They also argued that EPA could reasonably interpret section
211(h)(4) as applying to E15. One commenter further argued that E15
meets the terms of the 1 psi waiver for 10 vol% blends because it
contains gasoline and the minimum 10 vol% ethanol. Another commenter
contended that section 211(h)(4) could be interpreted to provide
authority for extending the 1 psi waiver to low to mid-level gasoline-
ethanol blends that have received a waiver under section 211(f)(4).
Finally, commenters mentioned that E15 would have a similar (if not
slightly lower) RVP to E10 and would not exceed applicable RVP limits
if the 1 psi waiver is applied. One commenter suggested further that
the deemed to comply provision found in section 211(h)(4) of the Act
does not tie the compliance of gasoline-ethanol blends directly to
ethanol content. The commenter argued that the primary limitation on
applying the 1 psi waiver would likely be actions that increase RVP not
hard percentage limits on ethanol content, and since E15 would have
similar if not lower RVP than E10, then E15 should receive the 1 psi
waiver.
We also received several comments supporting our proposed
interpretation. In today's rule, we are confirming our view that
section 211(h)(4) limits the 1 psi waiver to fuel blends containing
gasoline and 9-10 vol% ethanol, including limiting the provision
concerning ``deemed to be in full compliance'' to the same 9-10 vol%
gasoline-ethanol blends.
Evaporative emissions from motor vehicles and off-highway equipment
are a major source of volatile organic compounds (VOCs) that contribute
to ozone. The amount of evaporative emissions from a gasoline blend is
closely related to its volatility, which generally increases when
ethanol is blended with gasoline. RVP is the most common measure of
gasoline volatility under ambient conditions. In 1989, EPA began
reducing gasoline volatility by limiting its RVP. We provided an
interim RVP level that was 1 psi higher ``for gasoline-ethanol blends
commonly known as gasohol.'' 54 FR 11868, 11879 (March 22, 1989). In
1990, we promulgated additional RVP regulations that continued to
provide a 1.0 psi RVP allowance for E10 so as not to require a special
low-RVP blending gasoline. 55 FR 23658, 23660 (June 11, 1990).
Subsequently, in the 1990 CAA amendments, Congress largely codified
our RVP regulations by adding a new section 211(h). That provision
established 9.0 psi as the maximum RVP during the high ozone season,
with authority for EPA to set a more stringent RVP level under certain
circumstances. In section 211(h)(4), Congress also established that the
RVP limit for fuel blends containing gasoline and 10 percent denatured
anhydrous ethanol would be 1 psi higher than the RVP standard otherwise
established in section 211(h). This is referred to as the 1 psi waiver.
``For fuel blends containing gasoline and 10 percent denatured
anhydrous ethanol, the Reid vapor pressure limitation under this
subsection shall be one pound per square inch (psi) greater than the
applicable Reid vapor pressure limitations established under paragraph
(1).'' Section 211(h)(4). Congress also enacted a conditional defense
against liability for violations of the RVP level allowed under the 1
psi waiver by stating that ``[p]rovided; however, That a distributor,
blender, marketer, reseller, carrier, retailer, or wholesale purchaser-
consumer shall be deemed to be in full compliance with the provisions
of this subsection and the regulations promulgated thereunder if it can
demonstrate that--(A) The gasoline portion of the blend complies with
the Reid vapor pressure limitations promulgated pursuant to this
subsection; (B) the ethanol portion of the blend does not exceed its
waiver condition under subsection (f)(4) of this section; and (C) no
additional alcohol or other additive has been added to increase the
Reid Vapor Pressure of the ethanol portion of this blend.'' Section
211(h)(4). This is referred to as the
[[Page 44434]]
``deemed to be in full compliance'' or the ``deemed to comply''
provision.
Following the 1990 amendments, EPA modified its RVP regulations to
conform to the new provisions. In that rulemaking EPA ``did not
propos[e] any change to the current requirement that the blend contain
between 9 and 10 percent ethanol (by volume) to obtain the one psi
allowance.'' 56 FR 64704, 64708 (December 12, 1991). We explained that
``this is consistent with Congressional intent [because] the nature of
the blending process * * * further complicates a requirement that the
ethanol portion of the blend be exactly 10 percent ethanol.'' 56 FR
24245. We also explained that the deemed to be in full compliance
provision was ``a new defense against liability for violation of the
ethanol blend RVP requirement [and that] EPA believes that this
statutorily mandated defense is in addition to and does not supersede
any of the defenses currently contained in the regulations.'' 56 FR
64708. Additionally, EPA explained that this provision would allow ``a
party to demonstrate the elements of the new defense by production of a
certification from the facility from which the gasoline is received
[and that] this defense is limited to ethanol blends which meet the
minimum 9 percent requirement in the regulations and the maximum 10
percent requirement.'' 56 FR 64708.
In the Energy Policy Act of 2005 (EPAct), Congress removed the
requirement that reformulated gasoline contain oxygenate additives, and
mandated that increasing volumes of renewable fuel be used in gasoline.
In recognition of the expected increase in ethanol use resulting from
these provisions, Congress added section 211(h)(5) to allow States to
obtain an exclusion from the less stringent RVP limit under section
211(h)(4) for air quality reasons. ``Upon notification, accompanied by
supporting documentation, from the Governor of a State that the RVP
limitation established by paragraph (4) will increase emissions that
contribute to air pollution in any area in the State, the Administrator
shall, by regulation, apply, in lieu of the RVP limitation established
by paragraph (4), the RVP limitation established by paragraph (1) to
all fuel blends containing gasoline and 10 percent denatured anhydrous
ethanol [sold] in the area during the high ozone season.'' Section
211(h)(5).
The legislative history of the 1 psi waiver provision shows that it
is for fuel blends containing gasoline and 10 percent ethanol. The
purpose of the 1 psi waiver provision was to facilitate the
participation of ethanol in the transportation fuel industry while also
limiting gasoline volatility resulting from ethanol blending. Congress
also intended for this provision to remove the possibility that ethanol
blends would be used to circumvent the gasoline volatility
restrictions. In 1987, prior to adoption of the 1990 Amendments,
Congress considered a legislative provision that was identical in
relevant part to section 211(h)(4). The legislative history of this
provision shows that Congress based the 1 psi waiver on technical data
indicating that blending gasoline with ethanol so that it contains 9-10
vol% ethanol results in an approximate 1 psi RVP increase. In sum, the
text of section 211(h)(4) and this legislative history supports EPA's
interpretation, adopted in the 1991 rulemaking, that the 1 psi waiver
only applies to gasoline blends containing 9-10 vol% ethanol.
In the 1991 rulemaking EPA also interpreted the deemed to comply
provision in section 211(h)(4) as establishing an alternative
compliance mechanism closely tied to the 1 psi waiver. It was
interpreted as a conditional defense against liability for those
parties who blend ethanol into gasoline to achieve 9-10% ethanol by
volume. EPA continues to interpret the deemed to comply provision in
this manner, such that it does not apply to ethanol blends greater than
10% by volume. This is consistent with the text and legislative history
of section 211(h)(4) and (h)(5).
As noted above, in 1987 Congress considered a bill containing
language identical in relevant part to section 211(h)(4). The
provisions in that 1987 Senate bill were in response to EPA's 1987
proposed RVP rule, in which EPA proposed a 1 psi waiver for ethanol
blends, but conditioned this waiver on the final blend being tested for
RVP. The deemed to comply provision was Congress' response to concerns
that this was an impractical and overly burdensome way to implement a 1
psi waiver for 10% gasohol. The Senate bill describes the deemed to
comply provision as an alternative enforcement arrangement that
simplified compliance with the 1 psi waiver. Thus, the deemed to comply
provision is tied to the 1 psi waiver, and is designed to provide
blenders the practical benefits of the 1 psi RVP waiver. It is not
intended as a separate authorization for a relaxed RVP limit
independent of the provision for a 1 psi waiver for 9-10% blends.
The text of the deemed to comply provision supports this
interpretation. The provision is an addition after the 1 psi waiver
that modifies the 1 psi waiver for 9-10% blends. It is not written as a
free standing RVP limit that acts separate and apart from the 1 psi
waiver for 9-10% blends of ethanol. Its reference to section 211(f)(4)
is an indication that Congress was well aware of the existing section
211(f)(4) waiver conditions for 10% ethanol by volume. It refers to the
ethanol blend not exceeding its section 211(f)(4) waiver conditions,
and does not explicitly refer to 10% ethanol, but the condition of
``not exceed[ing]'' the section 211(f)(4) waiver limit cannot be read
literally. A literal reading of this phrase would mean that blends
containing 1%, or 2%, or 5% ethanol would all be blends that are deemed
to comply, as they do not exceed the section 211(f)(4) waiver limit.
Such a broad reading would make the 1 psi waiver for 9-10% blends
meaningless. Moreover, had Congress intended that the deemed to comply
provision would establish a different ethanol content for ethanol
blends that would be eligible for a relaxed RVP limit, whether higher
or lower content, it could have expressly employed terms to that
effect.
The deemed to comply provision and the 1 psi waiver provision are
each given consistent meaning by limiting the deemed to comply
provision to a subset of lawful ethanol blends. The text of these
provisions and their legislative history indicate that the deemed to
comply provision was designed to address the same subset of ethanol
blends that receive the 1 psi waver--blends of 9-10% ethanol. It was
not a separate and free standing RVP provision aimed at another, larger
subset of lawful ethanol blends, whether above or below 9-10% blends.
Instead it was tied closely to the 1 psi waiver provision and limits
the range of ethanol blends that can take advantage of the deemed to
comply provision to blends of 9-10% ethanol.
Further support for this view is provided in the action Congress
took in 2005 when it adopted section 211(h)(5). This provision treats
the RVP limitation of section 211(h)(4) as a whole--it refers to the
RVP ``limitation established by paragraph (4)'' and provides that when
a State notifies EPA that such limitation increases emissions that
contribute to air pollution in the State, then EPA is to apply the RVP
limits of paragraph (1) ``in lieu of the [RVP] limitation established
by paragraph (4)'' for blends of 10% ethanol. It draws no distinction
between the 1 psi waiver provision and the deemed to comply provision
when referring to the RVP limitation in section 211(h)(4). Section
211(h)(5) recognizes the potential that the relaxed RVP limit in
section 211(h)(4) could
[[Page 44435]]
increase emissions that contribute to air pollution, and provides
States with an appropriate solution. When a State notifies EPA that the
RVP limit under section 211(h)(4) is contributing to an air pollution
problem, EPA is to apply the more stringent RVP limit under paragraph
(1) in lieu of the relaxed limit allowed under section 211(h)(4). These
more stringent RVP limits are applied to blends of 9-10% ethanol. A
straightforward reading of this provision is that Congress intended to
provide States a meaningful and complete solution to emissions
increases stemming from the relaxed RVP provisions in section
211(h)(4), not a partial solution. If the deemed to comply provision is
read as applying to ethanol blends above or below 9-10% ethanol,
however, this provision would provide no relief for emissions from
various ethanol blends different from 9-10% ethanol, including E15.
There is no indication Congress intended such a partial and
inconsistent solution. Both the text and legislative history of this
provision indicate Congress viewed section 211(h)(5) as addressing the
potential for air pollution problems from the relaxed RVP limit in
section 211(h)(4), which applies to blends of 9-10% ethanol.
In sum, EPA views these three provisions--the 1 psi waiver and the
deemed to comply provision in section 211(h)(4), and the State relief
provision in section 211(h)(5)--as related provisions that should be
interpreted together in a way that harmonizes them and provides
significance and a balanced meaning to each of them. EPA believes that
this is reasonably done by viewing the 1 psi waiver provision in
section 211(h)(4) as applying to blends of 9-10% ethanol; by viewing
the deemed to comply provision as applying to the same subset of 9-10%
ethanol blends, and not applying to blends above or below the range of
9-10%; and by viewing the provision for relief to States in section
211(h)(5) as applying to the same subset of 9-10% ethanol blends. This
is consistent with the text and legislative history of the three
provisions, which indicate that the RVP provisions in section 211(h)(4)
are intended to work together to facilitate the use of ethanol blends
of 9-10%, that the deemed to comply provision is not a free standing or
separate provision that addresses fuels different from those covered by
the 1 psi waiver, and that the provision for States in section
211(h)(5) is intended to provide relief co-extensive with the RVP
limits in section 211(h)(4). This interpretation harmonizes all three
provisions, gives each of them significant meaning, avoids making any
of the provisions meaningless, and reasonably balances the various
interests Congress was addressing in these provisions--controlling the
RVP of gasoline and ethanol blends in a way that facilitates the
practical downstream blending of ethanol while also preserving the
ability of States to address the increased emissions associated with a
relaxed RVP limit for ethanol blends.
Some commenters argued that section 211(h) should be interpreted
such that E15 is eligible for the 1 psi waiver in section 211(h)(4),
and that under section 211(h)(4) the 1 psi waiver applies to fuels that
contain a minimum of 10% ethanol, while section 211(f)(4) sets the
maximum ethanol content under the deemed to comply provision. None of
the commenters discussed section 211(h)(5) or explained how their
respective interpretations would interact with section 211(h)(5). For
the reasons discussed above, EPA does not agree with the commenters'
arguments. For a full discussion of the comments and EPA's response,
see the Response to Comments document, which is in the docket for this
rulemaking.
C. RVP and E15 Underground Storage Tank Transition
In the NPRM, we pointed out the potential problems that could occur
if a higher RVP E10 fuel (i.e., E10 fuel that took advantage of the
statutory 1.0 psi RVP waiver) is commingled in underground storage
tanks with a lower RVP E15 fuel (i.e., E15 fuel that met the summertime
conventional gasoline RVP standard without the 1.0 psi RVP increase,
since the statutory 1.0 psi RVP waiver is not applicable to E15, and
that also complied with the condition of the partial waivers limiting
the summertime volatility of E15 to 9 psi). Commingling of these fuels
would typically be an issue when a retail station decides to transition
from selling E10 to E15, or E15 to E10, during the summertime ozone
season. In these circumstances, if the retail station does not
completely remove all E10 from a tank before E15 is added to the tank
(or E15 before E10 is added), the gasoline fuel remaining in the
dispensing station tank would likely violate the applicable RVP
standards as well as the 9 psi RVP condition of the E15 partial
waivers. For example, if a quantity of E10 at 10.0 psi RVP is blended
with a quantity of E15 at 9.0 psi RVP, the resulting blend would have
an ethanol content somewhere above 10 vol% (but below 15 vol%). The
resulting blend would also have an RVP above 9.0 psi. Since the blend
is above 10 vol% ethanol, it would not qualify for the 1.0 psi waiver.
It would also be subject to the 9 psi RVP condition of the partial
waivers, since the waivers cover any gasoline-ethanol blend above 10
vol% ethanol up to 15 vol% ethanol. In this way, commingling would
likely result in fuel that does not comply with applicable RVP limits
or the RVP condition of the partial waivers.
As mentioned in the NPRM, section 211(t) of the Clean Air Act,
adopted in the Energy Policy Act of 2005, allows retail stations to
blend compliant reformulated gasoline batches of non-ethanol blended
and ethanol-blended gasoline in storage tanks twice a year as long as
the duration of the blending period is no longer than 10 consecutive
calendar days. However, the authority granted to the Agency for the
transition of fuels in underground storage tanks was specifically
limited to the case of reformulated gasoline, and this provision does
not authorize a change in the RVP standards for blending down of E10
and E15 over time in non-reformulated gasoline areas. We sought comment
on the issue of tank transition between E10 and E15 fuels and ways that
the Agency could address this issue so that tank transition might be
more easily accomplished.
A related issue is whether to specifically disallow the commingling
of E10 and E15 or of blendstocks produced specifically for blending E10
and E15. In the NPRM we proposed a specific regulation that would
prohibit combining ``any base gasoline or conventional blendstock for
oxygenate blending intended for blending with E10 that took advantage
of the 1 psi waiver applicable for 9-10 volume percent gasoline-ethanol
blends with any gasoline or conventional blendstock for oxygenate
blending intended for blending with E15, unless the resultant
combination is designated, in its entirety, as an E10 blendstock for
oxygenate blending''. Additionally, we proposed to prohibit combining
``any gasoline-ethanol blend containing E10 that took advantage of the
1 psi waiver applicable to 9-10 volume percent gasoline-ethanol blends,
with any gasoline containing E0 or any gasoline blend containing E15''.
(75 FR 68089, November 4, 2010). Such a prohibition would aid in
preventing mixing that would result in gasoline in dispensing tanks
that does not comply with the RVP standards due to tank transitions as
described above.
Regarding tank transition in reformulated gasoline areas and a
possible commingling prohibition, one commenter stated that it opposed
a specific commingling prohibition because existing rules already
prohibit
[[Page 44436]]
application of the 1 psi RVP waiver to other than E10 and any tank
transition from E10 to E15 would likely happen only once. The commenter
further stated that if such a prohibition is necessary, it should apply
only in summer months. Other commenters also opposed a commingling
prohibition and generally stated that such a prohibition would create
unnecessary difficulties in introducing E15 into commerce.
As explained above, the 1.0 psi RVP waiver for conventional
gasoline applies only to E10 blends, and it is already a violation of
RVP standards to have an RVP higher than the standards for fuels not
qualifying for the 1.0 psi RVP exemption, such as E15. Furthermore, it
is correct that any prohibition against commingling, like the current
RVP limitations, would apply only during the summertime ozone season.
We also recognize that current regulatory requirements make it a
violation to have higher RVP than allowed when commingling E10 and E15
in retail tanks. However, we believe that specific commingling
regulations can provide additional, useful directions and incentive not
to blend E10 and E15 in a way that would produce summertime
conventional gasoline that violates the applicable RVP standard (and
the 9 psi RVP limitation of the partial waivers). The prohibition
against combining gasoline or blendstocks for E10 and E15 production
prior to blending makes it clear that such blending will result in a
blendstock that will in turn result in an unlawful gasoline (unless it
is only used to make E10). In addition, the prohibition against
commingling of E15 with E10 blends, which would likely occur in a
dispensing tank, will help prevent unintended commingling of the two
blends in dispensing tanks. Regarding summertime transitions, the
additional prohibition makes it clear that commingling these types of
fuel without one or the other fuel being completely drawn down in the
tank is, in fact, prohibited. We are therefore adopting the commingling
prohibitions as proposed. The PTDs described elsewhere in today's final
rule will help ensure that parties in the distribution chain are
adequately aware of the fuel they are distributing and loading into
underground dispensing tanks and will clearly aid parties in avoiding
violations.
Comments were received supporting the idea that relief should be
granted to retail stations transitioning between E10 and E15. However,
the only specific suggestion received was to apply the statutory 1 psi
RVP waiver to E15. As discussed above, EPA interprets the relevant
provisions of the Clean Air Act as authorizing the 1 psi RVP waiver
only for gasoline-ethanol blends containing 9-10 vol% ethanol. In
addition, we note that over the past several years most dispensing
facilities with underground tanks have transitioned from E0 to E10
without significant difficulties. Transitioning tanks between E0 and
E10 presents the same practical challenges as transitioning between E10
and E15 in terms of RVP compliance issues. Transitions between E0 and
E10 have typically been accomplished by making the transition during
the wintertime when the RVP compliance issue is not relevant, or during
the summertime by drawing down the tank to effectively empty the tank
prior to introducing the new fuel. These strategies should also be
effective for transitioning to E15. For all of these reasons, we are
not adopting any specific regulatory program for providing relief to
retail stations in transitioning from E10 to E15.
D. Credit for RFG Downstream Oxygenate Blending
As stated in the NPRM, refiners (or importers) of reformulated
blendstock for oxygenate blending (RBOB) are permitted to take credit
for downstream oxygenate blending when complying with RFG standards if
certain conditions are met. 40 CFR 80.69. To do so, the refiner's or
importer's RBOB must be accompanied by a PTD that specifies the type
and amount of oxygenate that must be added. In addition, the refiner or
importer must have direct oversight of the addition of the oxygenate
or, in the alternative, a survey of all RFG areas supplied by the
refiner(s) or importer(s) must be performed to show that the requisite
amount of oxygenate is added as specified by the PTD. In either case,
EPA requested comment regarding how credit for RFG downstream oxygenate
blending should be dealt with in light of the potential introduction of
E15 into the RFG marketplace.
One commenter noted that PTDs and surveys should be sufficient to
ensure that the requisite amount of oxygenate is added downstream so
that the refiner can claim credit for the oxygenate addition when
producing RBOB for RFG production.
As pointed out above, the regulations at 40 CFR 80.69 already allow
credit for RFG downstream oxygenate blending through either direct
oversight or an oxygenate survey for RFG areas utilizing a specific
amount and type of oxygenate for blending purposes. Both of these
approaches can accommodate blending of E15 if such blending were to be
utilized in adding oxygenate downstream to produce RFG. Importantly,
when utilizing either of these approaches, the refiner or importer must
specify in the PTD for the RBOB the type and amount of oxygenate that
must be added, such that the oxygenate addition will produce RFG that
meets applicable standards (such as benzene and VOC) that ``formed the
basis for the refiner's or importer's compliance determination for
these parameters.'' \31\ This would mean, for example, that if a
refiner or importer wants to take credit for downstream blending of
E15, they must either directly supervise the addition of E15 to their
RBOB or conduct an appropriate survey to show that E15 has been added
as directed in the PTD. Therefore, considering existing requirements
such as direct oversight, surveys, and PTDs, we conclude that no
regulatory change is needed regarding credit for RFG downstream
oxygenate blending.
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\31\ 40 CFR 80.69(a)(10).
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E. Compliance, Enforcement and Warranty
We proposed liability and penalty provisions for the proposed
misfueling mitigation measures similar to the liability and penalty
provisions found in other EPA fuels regulations. Many commenters raised
issues concerning liability for violations of the proposed misfueling
mitigation measures and other potential consequences of the use of, or
transition to, E15. According to a number of commenters, fuel providers
are unlikely to sell E15 until a variety of different liability issues
are resolved. Although EPA is not in a position to address all of the
liability issues raised by commenters, in this section we address those
within our jurisdiction and clarify the responsibilities of various
parties, including fuel producers, distributors, retailers, product
manufacturers and consumers, for compliance with Agency misfueling
prohibitions and CAA vehicle and engine warranty and other requirements
under the Act.
In general, we believe the long-standing approach of EPA's fuels
programs and vehicle, engine, and equipment emissions warranty
regulations to assigning respective responsibilities for compliance
with our regulations is also appropriate for E15. We expect the
required label and other misfueling mitigation measures, as reinforced
by a public outreach campaign, will minimize consumer use of E15 in
vehicles, engines, and products not covered by the partial waiver
decisions. The misfueling mitigation program should in turn minimize
any liability that might arise
[[Page 44437]]
under the CAA or our regulations regarding misfueling with E15.
With regard to other transition issues within EPA's jurisdiction,
we are continuing to make progress in developing guidance for
determining whether existing underground storage tank systems are
compatible for storing E15. We also plan to work with stakeholders to
monitor and facilitate efforts to address other transition issues
involving state, local and other requirements.
1. Proposed Approach
In the NPRM, we proposed specific prohibited acts for general
misfueling mitigation purposes related to the distribution, sale, and
use of gasoline containing greater than 10 vol% ethanol. We also
proposed related liability and penalty provisions for noncompliance
with the proposed prohibited acts. These proposed liability and penalty
provisions included presumptive liability for parties in the fuel
distribution system (consistent with presumptive liability provisions
of other EPA fuels programs), affirmative defenses for liable parties,
and penalties for violations.
With respect to prohibited acts, we proposed that all fuel
providers (producers, manufacturers, distributors, wholesale purchaser-
consumers, and retailers) would be prohibited from selling, introducing
into commerce, or causing or allowing the sale or introduction into
commerce of gasoline containing greater than 10 vol% ethanol into
MY2000 and older light-duty motor vehicles, any heavy-duty gasoline
vehicle, any motorcycle and all types of nonroad equipment. In
addition, we proposed that fuel distributors who transport or store
gasoline-ethanol blends, gasoline or blendstock for ethanol blending
would be prohibited from increasing the ethanol content to exceed the
value noted on the PTD. We also proposed that retailers and wholesale
purchaser-consumers would be prohibited from dispensing E15 unless they
comply with the dispenser labeling requirements. The final labeling and
other misfueling mitigation requirements are discussed in section
III.A. of this notice.
The liability and penalty provisions discussed in the proposal are
similar to the liability and penalty provisions found in other EPA fuel
regulations. Specifically, EPA fuels programs generally include a
liability scheme for violations of prohibited acts that involves a
rebuttable presumption of liability in specified circumstances. Under
this approach, liability is imposed on the party in the fuel
distribution system that controls the facility where the violation
occurred and those parties, typically upstream in the fuel distribution
system from the initially listed party, whose prohibited activities
could have caused the nonconformity to exist.\32\ We emphasized in the
proposal that any person who commits a prohibited act, or causes
another person to commit a prohibited act, would also be liable for a
violation, so most parties in the chain of distribution would be
subject to the rebuttable presumption of liability for committing
prohibited actions or causing violations by other parties.\33\
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\32\ As noted in the preamble to the proposed rule, an
additional type of liability, vicarious liability, is imposed on
branded refiners under EPA's fuels programs.
\33\ As noted previously in this preamble, consumers are among
the parties subject to the prohibition on misfueling with E15.
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The presumptive liability approach for violations of prohibited
acts in our fuels programs also includes affirmative defenses to
prohibited acts. Generally, affirmative defenses require a
demonstration of all of the following: (1) The fuel provider did not
commit or cause the violation; (2) the fuel provider has PTDs
indicating the fuel was in compliance at its facility; and (3) except
for retailers and wholesale purchaser-consumers, the fuel provider
conducted a quality assurance program. In the proposal, we stated that
if a consumer was liable for introducing gasoline with an ethanol
content greater than 10 vol% into a vehicle, engine, or product not
covered by the E15 partial waivers, then a self-service retailer would
typically not be held liable for the consumer misfueling if the
retailer's dispensers were labeled appropriately and did not condone or
facilitate the misfueling.
While the NPRM proposed general misfueling mitigation provisions,
it did not specifically address emissions warranties for vehicles,
engines, and equipment or the effect of E15 use on the warranties.
However, warranties are addressed by other EPA regulations and the
effect of E15 use on the warranties is no different than the effect of
other legal fuels on the warranties. EPA regulations require emission-
related parts to be warranted that they are free from defects in
materials and workmanship which cause failure to meet emissions
standards and that at the time of sale the vehicles are designed,
built, and equipped in compliance with EPA's regulations. (See CAA
section 207(a).) There is also a performance warranty that applies in
certain cases for the short testing conducted by state inspection and
maintenance programs. (See CAA section 207(b).) The emissions warranty
for light-duty motor vehicles is typically two years or 24,000 miles,
except for the warranty for emission control computers and catalytic
converters, which is eight years or 80,000 miles. Other vehicles and
equipment may have warranties of a different duration, or warranties
measured in hours of operation. Warranties may be made conditional on
the use of a specified fuel as long as it is available, and the
condition is appropriately noted in the owner's manual. (See e.g. 40
CFR. 85.2104, 1068.115). Despite the condition, however, manufacturers
may not deny a warranty based on the use of a different fuel if that
fuel did not cause the problem for which the warranty claim is made.
2. Consideration of Comments
a. Prohibited Acts and Liability Provisions
Commenters suggested that the proposed regulations do not, but
should, prohibit intentional misfueling of vehicles with E15. We
believe that the proposed regulations did include this prohibition.
Specifically, the proposed regulations would prohibit consumer
misfueling, whether intentional or not, and we are retaining that
provision in today's final rule. Thus, today's final rule prohibits any
person from introducing or causing the introduction of gasoline
containing greater than 10 vol% ethanol into vehicles, engines, and
products not covered by the E15 partial waivers, and prohibits causing
or allowing the introduction of gasoline containing greater than 10
vol% ethanol into such vehicles, engines, and products.
Concerning retailers' liability, some commenters suggested that
where a retailer complies with the E15 labeling requirements, the
retailer should be completely immune from liability in the event that
misfueling by consumers occurs. Other commenters suggested that proper
labeling should shield retailers from liability absent evidence that
the retailer encouraged or facilitated the misfueling. In contrast,
still other commenters suggested that retailers be required to actively
assess if misfueling is in fact occurring at self-serve pumps. We do
not believe that retailers should be provided with blanket immunity
based on labeling alone. The obligation of a retailer is to not misfuel
and to not cause misfueling. Misfueling may occur in or as a result of
varied circumstances, making a bright line provision--such as the
suggested blanket immunity if dispensers are properly labeled--
problematic. For
[[Page 44438]]
example, proper labeling by a retailer that is located at a marina and
that sells fuel almost exclusively for use in boats may not be enough
to avoid liability for misfueling of boats with E15. The variety of
circumstances in which fueling occurs also do not warrant a blanket
requirement of some specific degree of active oversight by the
retailer. We therefore believe that it is appropriate to continue to
apply the liability provisions of the misfueling mitigation regulations
generally as proposed. The provisions finalized today are substantially
the same as the liability provisions of other regulations governing the
sale and use of fuels governed by the Act, and we believe that those
provisions are effective. Like those regulations, today's final
regulations specify which regulated parties can be held liable for
infractions of the requirements, and allows assertion of defenses to
such liability if a party meets specified conditions. For retailers, as
well as other regulated parties, one of those conditions is that the
prohibited act was not committed or caused by the party.
Commenters suggested that EPA specify in the regulations that a
retailer did not ``cause'' misfueling at properly labeled pumps if the
retailer did not condone or facilitate the misfueling. EPA does not
believe that adding such a specification to the regulation is merited,
for the reasons discussed above. If a misfueling violation does occur,
we will assess all of the circumstances pertaining to the violation to
assess whether a defense of lack of causation is valid, and if not, the
severity of the violation. EPA will take into consideration all actions
taken by the retailer to avoid misfueling. For the reasons discussed in
Section III of this notice, today's rule requires that several specific
misfueling mitigation measures be implemented and does not require that
additional measures be employed at this time. However, retailers may
choose to employ a variety of other measures, such as obtaining
confirmation that the consumer desires to dispense E15 or equipping
pumps that dispense only E15 with a distinctly colored nozzle hand
warmer, as they consider appropriate for their circumstances. A party
does not need to employ such measures in order to establish an
affirmative defense to a presumption of liability, but EPA will
consider any additional measures that a party has taken in assessing
all of the circumstances that pertain to a violation.
Similarly, commenters also suggested that where a branded supplier
of E15 complies with the labeling and other provisions, and has
implemented a program notifying its retailers of the requirements of
the law, it should be immune from liability if misfueling does occur.
Based on EPA's experience with other fuels programs, EPA does not
believe that merely notifying retailers about the requirements should
immunize branded suppliers from liability for violations at retailers.
As a result, EPA is not changing those defenses in the rule promulgated
today. However, for a misfueling violation by a consumer at a branded
retailer, EPA will consider all of the circumstances pertaining to the
violation to assess whether a branded refiner's defense of lack of
causation is valid, and if not, the severity of the violation.
b. Emissions Warranty Issues for Vehicles, Engines, and Equipment
Commenters expressed concern that motor vehicle manufacturers might
void the emissions warranty of motor vehicles based on use of E15 and/
or that warranty claims will increase in number as a result of E15 use.
Based on the test data and analysis on which the E15 partial waivers
were based, EPA believes that voiding a warranty claim will occur
infrequently if at all for MY2001 and newer light-duty vehicles (i.e.,
those for which the E15 partial waivers allow E15 to be sold for use)
fueled with E15. For light-duty and other motor vehicles not covered by
the partial waivers, EPA notes that to avoid honoring an emissions
warranty, a manufacturer must not only condition the warranty on use of
a fuel other than E15, it must also must show that use of E15 was
relevant to the reason that the motor vehicle failed emissions testing.
EPA regulations for nonroad equipment impose similar conditions on
voiding warranties for nonroad equipment. In light of the misfueling
prohibition and labeling requirements adopted in today's rule, we
expect that consumers will have both the information and incentive they
need to avoid misfueling with E15 and any damage to emission controls
that misfueling could cause.
Commenters also stated that imposing a burden on manufacturers to
show that E15 was the cause of a failure is unfair, and that
manufacturers will be required to report more defects to EPA.
Manufacturers currently make such determinations under the warranty
provisions, as well as the defect reporting provisions (see 40 CFR
85.1901 et seq., 1068.501). As with other emissions warranty related
circumstances, manufacturers are in the best position to investigate
and determine the cause of defects and emissions failures of their
vehicles or equipment, and they are best equipped to make
determinations regarding whether a warranty should be honored. We are
interested in learning about any defects, or investigations of defects
that are required to be reported, including those involving defects
that may be related to use of E15, including misfueling with E15.
However, we note that EPA will only order a recall based on a
determination that a substantial number of vehicles would fail to meet
their emissions standards when the motor vehicle is properly maintained
and used (see e.g. 40 CFR 85.1802(a)).
c. Other Issues Outside of CAA Jurisdiction
Commenters expressed concern that consumers will make monetary
claims against E15 retailers for damage to their vehicles or equipment
related to E15 use. They asked that EPA indemnify retailers against
such claims. As noted above, EPA does not believe that such damage will
occur when E15 is properly used. In addition, the provisions adopted
today provide a strong incentive for all parties, including consumers,
to avoid misfueling. We also plan to work with stakeholders on an
outreach effort, which should further limit misfueling incidences.
However, we have no authority to, and do not intend to, address issues
of liability that might be raised in litigation between private
parties. EPA is only addressing issues relevant to its exercise of
authority under the Clean Air Act. It is also worth noting that fuel
providers are not required to make or offer E15 and do so of their own
choosing.
Commenters expressed concern that E15 misfueling could result in
personal injury to consumers, leading to safety recalls by other
Federal agencies, among other things. They also suggested that EPA
should address materials compatibility and safety issues regarding E15
and dispensing equipment and storage tanks. Other agencies act under
their own authorities, and EPA is not in a position to address in this
rule actions that may or may not be taken by other agencies in the
future. As noted previously, EPA is developing final guidance for
determining the compatibility of existing underground storage tanks
with E15. The issues of materials compatibility and safety issues
regarding dispensing equipment are addressed by state and/or local
requirements.
3. Final Requirements
With respect to compliance and enforcement associated with
prohibited acts to mitigate misfueling, today's final
[[Page 44439]]
rule includes liability requirements that are consistent with the
liability requirements of other EPA fuels programs--retailers and other
parties are presumptively liable for consumer misfueling and other
violations, but parties are not liable if they can show they did not
cause the misfueling. Consumers are also liable for misfueling their
own vehicles, engines or products.
Regarding vehicle, engine, and equipment emissions warranties,
under EPA warranty regulations, manufacturers may condition an
emissions warranty on the use of a specific fuel but they may not deny
a warranty on the use of a different fuel if that fuel did not cause
problems.
F. Technical Basis for the Rule
These misfueling mitigation regulations are issued under CAA
section 211(c) in order to prevent or minimize the emission increases
that would occur if E15 is used in vehicles, engines, and products for
which the waiver has been denied, specifically, MY2000 and older motor
vehicles and all heavy-duty gasoline engines and vehicles, motorcycles
and nonroad products. As described in the NPRM and E15 partial waiver
decisions, our assessment of the potential emission consequences of E15
use indicates that the emission-related components of MY2001 and newer
light-duty motor vehicles are durable for use on gasoline-ethanol
blends up to E15. This conclusion is based on the results of DOE's
Catalyst Study and other relevant test programs, as well as the
Agency's engineering assessment of advances in motor vehicle technology
(primarily control of the air-to-fuel ratio matched with advancements
in catalyst formulations) and materials that have taken place in
response to a series of important exhaust and evaporative emission
requirements since MY2000 and in-use experience with E10. These
requirements include the National Low Emission Vehicle and Tier 2 motor
vehicle emission standards, Supplemental Federal Test Procedure
compliance requirements, in-use durability requirements (required by
the Compliance Assurance Program of 2000), enhanced evaporative
emission standards, and E10 evaporative durability requirements.
Unlike for MY2001 and newer motor vehicles, there is very little,
if any, test data with respect the effect of E15 use in MY2000 and
older light-duty motor vehicles and all heavy-duty gasoline engines and
vehicles, motorcycles, and nonroad products. In addition, our
engineering assessment for these vehicles, engines, and products
identifies a number of emission-related concerns with the use of E15.
For motor vehicles and heavy-duty gasoline engines and vehicles, these
concerns include the potential for catalyst deterioration or catalyst
failure, as well as materials compatibility issues that could lead to
extremely elevated exhaust and evaporative emissions. For motorcycles
and nonroad products, the misfueling concerns include the potential for
elevated exhaust and evaporative emissions, as well as the potential
for emissions impacts related to engine failure from overheating. As
motorcycles and nonroad products have not been regulated as long as
motor vehicles, and have much more diverse applications, they have not
benefitted from the same advancements in technology as motor vehicles
and could experience combustion and materials compatibility problems
leading to increased emissions if operated on E15.
Based on these concerns, we proposed to prohibit the use of
gasoline-ethanol blends greater than 10 vol% in MY2000 and older motor
vehicles, and all heavy-duty gasoline engines and vehicles,
motorcycles, and nonroad products and invited comment on the
prohibition's applicability to those vehicles, engines, and products.
While some commenters stated that we should approve E15 for all motor
vehicles, those comments pertain to the waiver decisions. We received
no comments on our emissions-related technical justification for the
proposed misfueling mitigation measures under CAA section 211(c).
It is worth noting that while the labeling requirements covered in
Section III apply to E15, the prohibitions discussed in this section
apply to all gasoline-ethanol blends greater than 10 vol% (e.g., 20
vol% ethanol). This is consistent with our engineering assessment
discussed in the NPRM which was based, in part, on enleanment of the
air-to-fuel ratio. Ethanol enleans the air-to-fuel ratio which leads to
increased exhaust gas temperatures and therefore potentially
incremental deterioration of emission control hardware and performance
over time. This enleanment stems from the fact that ethanol contains
oxygen and consequently requires a lower air-to-fuel ratio to achieve
the stoichiometric (ideal) mixture for combustion. Vehicles, engines,
and equipment designed to operate on gasoline will therefore run leaner
when operating on gasoline-ethanol blends. Older motor vehicles, heavy-
duty gasoline engines and vehicles, motorcycles, and especially nonroad
products cannot fully compensate for the change in the stoichiometric
air-to-fuel ratio as ethanol concentration increases. Over time, this
enleanment caused by ethanol may lead to thermal degradation of the
emissions control hardware and ultimately catalyst failure. Higher
ethanol concentration will exacerbate the enleanment effect in these
vehicles, engines, and equipment and therefore increase the potential
of thermal degradation and risk of catalyst failure. In addition to
enleanment, ethanol can cause materials compatibility issues which may
lead to other component failure and ultimately exhaust and/or
evaporative emission increases. Materials compatibility with ethanol is
time, condition (e.g., temperature, pressure), and concentration
dependent. Therefore, for older motor vehicles, heavy-duty gasoline
engines and vehicles, motorcycles, and nonroad products, the potential
for materials compatibility issues increases with higher ethanol
concentration. We received no comments that the misfueling prohibition
should be narrowed to E15.
It is not possible to precisely quantify the frequency at which
these vehicles, engines, and products might experience problems with
the use of E15. However, we believe that emission-related problems
could potentially occur with enough frequency that the resulting
emissions increases that would be avoided by avoiding misfueling would
outweigh the relatively low cost imposed by the required misfueling
mitigation regulations. The potential emission increases from
misfueling warrant today's action, even if a very low percentage of
vehicles, engines, and products experiences problems. As discussed
above, the savings that would be achieved by avoiding misfueling also
far outweigh the costs of this rule. Therefore, we are finalizing the
misfueling mitigation measures we proposed with some refinements to
make them more effective and/or less burdensome.
G. The Effect of the Rule on the Misfueling Mitigation Conditions of
the Partial Waivers
In the NPRM, the Agency noted that some of the proposed misfueling
safeguards parallel the conditions of the partial waiver decisions, and
were expected to be a more efficient way to help ensure that the
conditions of the waiver were met.\34\ One commenter
[[Page 44440]]
suggested that if the proposed misfueling mitigation measures were
adopted, EPA should remove or alter the misfueling mitigation
conditions of the partial waivers to avoid placing requirements on
industry that would be duplicative and unnecessary. Specifically, the
commenter stated that fuel and fuel additive manufacturers should not
have to submit plans to EPA that explain how a fuel or fuel additive
manufacturer would meet the misfueling mitigation conditions of the
partial waivers.
---------------------------------------------------------------------------
\34\ 75 FR 68044, 68046 (November 4, 2010). The partial waiver
decisions require that fuel and fuel additive manufacturers (i.e.
gasoline producers/importers, ethanol producers/importers, and
oxygenate blenders) submit to EPA a plan prior to introduction of
E15 into commerce that demonstrates how the fuel or fuel additive
manufacturer will implement reasonable measures to ensure that
misfueling does not occur in vehicles and engines not approved for
use of E15. Reasonable measures to ensure against misfueling
include, but are not limited to, fuel pump labeling, proper
documentation of ethanol content on PTDs, and the implementation of
an ongoing survey program, in addition to any other reasonable
measures EPA determines are appropriate. See 75 FR 68149-68150.
---------------------------------------------------------------------------
In response to the commenter's suggestion, it is important to
clarify that the purpose of this rule is to mitigate misfueling with
E15 that lawfully has been introduced into commerce under the terms of
the waiver. The waiver conditions, and implementation of the waiver
conditions, address a closely related but different issue--when, how
and by whom E15 can be introduced into commerce under the partial
waiver decisions. This rule only addresses the issue of mitigating
misfueling in the event E15 is lawfully introduced into commerce under
the partial waivers, and is issued under EPA's authority under section
211(c). In this rulemaking EPA did not propose and is not taking any
action under section 211(f) with respect to the partial waivers that
were previously issued. For example, in this rulemaking EPA is not
modifying any of the conditions of the waivers, or making any decisions
as to whether they have been met. Decisions related to compliance with
the conditions on the waivers will be made separate and apart from this
rulemaking.
EPA recognizes that one result of today's rule is that it will
likely be easier for parties to show compliance with the misfueling
mitigation conditions of the partial waivers. However, today's rule
does not replace or supplant the waiver conditions themselves. The
partial waivers allow E15 to be lawfully introduced into commerce for
use in MY2001 and newer light-duty motor vehicles if certain conditions
are met. Fuel and fuel additive manufacturers that desire to make and
sell E15 must do so in compliance with the waivers' conditions, which
include submission of a misfueling mitigation plan that provides, among
other things, for E15 pump labels, PTDs indicating ethanol content and
an ongoing survey of implementation of E15 content and labeling
requirements. Today's rule will likely simplify compliance with many
aspects of the required plan. For example, a fuel or fuel additive
manufacturer may decide to reference the labeling and PTD requirements
of the rule as part of its plan to meet the counterpart conditions of
the waivers. EPA also expects that parties will be able to submit a
single survey plan that will meet both the waiver condition as well as
the separate regulatory requirements related to the survey adopted in
this rule. Since the partial waivers and the rule require that survey
plans be submitted to EPA for approval, EPA expects that compliance
with the survey requirements of the waiver conditions and the rule will
be accomplished with a single submission and approval process, covering
both this rule and the waiver condition.
EPA believes that the misfueling mitigation plans submitted under
the partial waivers will be especially useful when E15 is first
introduced into the market. For instance, many downstream parties may
not be aware of the new requirements that apply to E15 (e.g., E15 pump
labeling) early in any transition to E15. The first plans under the
partial waivers may thus usefully address how the fuel or fuel additive
manufacturer will work with downstream parties to ensure that the
misfueling mitigations measures adopted today are properly implemented.
Similarly, it may be appropriate for an ethanol manufacturer registered
under 40 CFR Part 79 to sell ethanol for use in manufacturing E15 to
address in its plan how parties that might use its product to make E15
will be informed of the misfueling mitigation requirements to which
those parties would become subject under this rule (e.g., labeling,
PTDs) if they make E15. Such parties would include, for example,
businesses that blend ethanol into gasoline to produce E15.
H. E15 Emissions and Anti-Backsliding
In the NPRM and in the partial waiver decisions, EPA discussed the
relationship between the ethanol content of a gasoline-ethanol blended
fuel and NOx emissions. EPA concluded that, in general, as
ethanol concentrations in gasoline increase, so do NOx
emissions. The Agency received several comments that argued that
potential NOx emission increases from E15 use would add to
the formation of ground-level ozone and potentially adversely affect
public health. Additionally, some commenters noted that such
NOx increases would add to the challenge some states and
cities face in meeting the current national air quality standards for
ozone and that EPA should take action to ameliorate potential adverse
emissions effects from E15 use. Although such action is outside of the
scope of today's rulemaking, the Agency has been performing analysis
needed to support the anti-backsliding analysis required under the
Energy Independence and Security Act of 2007. We are now in the process
of assessing possible control measures to offset the potential
increases in ozone and particulate matter that are expected to result
from the increased use of renewable fuels required by the Energy
Independence and Security Act of 2007 and in response to the May 21,
2010, Presidential Memorandum Regarding Fuel Efficiency Standards.
(NOx emissions contribute to the formation of both
pollutants.) We will incorporate the results of our analysis under this
assessment in a proposal on new motor vehicle and fuel control
measures.
V. Statutory and Executive Order Reviews
A. Executive Order 12866: Regulatory Planning and Review and Executive
Order 13563: Improving Regulation and Regulatory Review
Under Executive Order 12866 (58 FR 51735, October 4, 1993), this
action is a ``significant regulatory action.'' This action may raise
novel legal or policy issues. Accordingly, EPA submitted this action to
the Office of Management and Budget (OMB) for review under Executive
Orders 12866 and 13563 (76 FR 3821, January 21, 2011) and any changes
made in response to OMB recommendations have been documented in the
docket for this action.
B. Paperwork Reduction Act
This rule contains new information requirements which will be
submitted for approval to the Office of Management and Budget (OMB)
under the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. These
information collection requirements are not enforceable until OMB
approves them.
This final rule contains information collection provisions that
permit a party to apply for approval of an alternative or additional
E15 label. We anticipate that this provision will be utilized by some
refiners for their branded retailers, as well as by some individual
retailers and wholesale purchaser-consumers.
A party may elect to satisfy the survey requirements of this rule
individually
[[Page 44441]]
rather than through using a nationwide survey option (i.e., they may
elect ``Survey Option 1'' as described above in section III.C). In such
circumstances, the individual information collection requirements
associated with ``Survey Option 1'' will apply. Parties that may be
subject to survey information collection requirements include gasoline
refiners, gasoline and ethanol importers, gasoline and ethanol blenders
(including terminals and carriers), and ethanol producers.
Under the terms of the E15 partial waiver, fuel and fuel additive
manufacturers must submit a written plan to EPA for approval.\35\ The
plan must include provisions designed to prevent misfueling. The plan
must be submitted by all fuel and fuel additive manufacturers,
regardless of whether a party elects ``Survey Option 1'' (individual)
or ``Survey Option 2'' (nationwide). Parties that may be subject to
this information collection item may include gasoline refiners,
gasoline and ethanol importers, gasoline and ethanol blenders
(including terminals and carriers), and ethanol producers.
---------------------------------------------------------------------------
\35\ 75 FR 68094, 68149-68150 (November 4, 2010).
---------------------------------------------------------------------------
This rule contains provisions related to product transfer documents
(PTDs). Parties upstream of the retail station or wholesale purchaser-
consumer will be required to develop and program new codes and
statements for PTDs. These codes will reflect the ethanol content, as
well as the Reid Vapor pressure (RVP), as described in section III.B.
Parties subject to this one time burden include gasoline refiners,
gasoline and ethanol importers, and gasoline and ethanol blenders
(including terminals and carriers).
In addition to the one time burden of establishing/programming
codes and statements for PTDs, parties will be required to apply the
new codes and statements to PTDs as part of the normal course of
business. Typically, refiners and wholesale purchaser-consumers who are
not acting as blenders merely accept PTDs given to them by upstream
parties. The following parties may have the burden of applying codes
and statements: gasoline refiners, gasoline and ethanol importers,
gasoline and ethanol blenders (including terminals and carriers).
EPA estimates that there will be a total of 6,211 respondents,
submitting a total of 44,010,211 responses annually. We estimate an
annual total of 37,350 hours for all respondents and responses. The
total annual cost of this information collection request is estimated
at $4,102,524.
We estimate that the average annual burden per respondent is six
(6) hours and that the average annual cost per respondent is $661. We
estimate an average of .000849 hours per response. (It should be noted
that the reason for this short average time per response is that nearly
all of the responses will take approximately one second and represent
the time it takes to apply an automated code or statement to a PTD.)
Burden means the total time, effort, or financial resources
expended by persons to generate, maintain, retain, or disclose or
provide information to or for a Federal agency. This includes the time
needed to review instructions; develop, acquire, install, and utilize
technology and systems for the purposes of collecting, validating, and
verifying information, processing and maintaining information, and
disclosing and providing information; adjust the existing ways to
comply with any previously applicable instructions and requirements;
train personnel to be able to respond to a collection of information;
search data sources; complete and review the collection of information;
and transmit or otherwise disclose the information. An agency may not
conduct or sponsor, and a person is not required to respond to, a
collection of information unless it displays a currently valid OMB
control number. The OMB control numbers for EPA's regulations are
listed in 40 CFR part 9 and 48 CFR chapter 15.
C. Regulatory Flexibility Act
The Regulatory Flexibility Act (RFA) generally requires an agency
to prepare a regulatory flexibility analysis of any rule subject to
notice and comment rulemaking requirements under the Administrative
Procedure Act or any other statute unless the agency certifies that the
rule will not have a significant economic impact on a substantial
number of small entities. Small entities include small businesses,
small organizations, and small governmental jurisdictions.
For purposes of assessing the impacts of today's rule on small
entities, small entity is defined as: (1) A small business as defined
by the Small Business Administration's (SBA) regulations at 13 CFR
121.201; (2) a small governmental jurisdiction that is a government of
a city, county, town, school district or special district with a
population of less than 50,000; and (3) a small organization that is
any not-for-profit enterprise which is independently owned and operated
and is not dominant in its field.
After considering the economic impacts of today's final rule on
small entities, I certify that this action will not have a significant
economic impact on a substantial number of small entities. The small
entities directly regulated by this final rule are petroleum refiners
and importers, ethanol producers, ethanol blenders, gasoline terminals,
gasoline stations with convenience stores, and other gasoline stations.
While there are small entities in each of these market sectors as
discussed in Section III.F., the cost impact on any particular entity
is expected to be a tiny fraction of annual revenues.
D. Unfunded Mandates Reform Act
This rule does not contain a Federal mandate that may result in
expenditures of $100 million or more for State, local, and Tribal
governments, in the aggregate, or the private sector in any one year.
The total annual cost is expected to be $3.64 million. Thus, this rule
is not subject to the requirements of sections 202 or 205 of UMRA.
This rule is also not subject to the requirements of section 203 of
UMRA because it contains no regulatory requirements that might
significantly or uniquely affect small governments. This action
primarily affects the private sector, specifically petroleum refiners
and importers, ethanol producers, ethanol blenders, gasoline terminals,
gasoline stations with convenience stores, and other gasoline stations.
E. Executive Order 13132 (Federalism)
This action does not have federalism implications. It will not have
substantial direct effects on the States, on the relationship between
the national government and the States, or on the distribution of power
and responsibilities among the various levels of government, as
specified in Executive Order 13132. Any preemption of State or local
controls under section 211(c)(4)(A), based on issuance of this rule
under section 211(c)(1), would only apply to State or local controls
adopted for purposes of motor vehicle emissions control. This rule will
be implemented at the Federal level and impose compliance costs only on
petroleum refiners and importers, gasoline stations with convenience
stores, and other gasoline stations. Thus, Executive Order 13132 does
not apply to this action.
In the spirit of Executive Order 13132, and consistent with EPA
policy to promote communications between EPA and State and local
governments, EPA specifically solicited comment on the proposed action
from State and local officials. The Agency did not receive any comments
from states or local governments that cited a concern over state
preemption or federalism.
[[Page 44442]]
F. Executive Order 13175
This action does not have tribal implications, as specified in
Executive Order 13175 (65 FR 67249, November 9, 2000). This rule will
be implemented at the Federal level and impose compliance costs only on
petroleum refiners, importers, oxygenate blenders, gasoline stations
with convenience stores, and other gasoline stations. Thus, Executive
Order 13175 does not apply to this action.
G. Executive Order 13045: Protection of Children From Environmental
Health Risks and Safety Risks
EPA interprets EO 13045 (62 FR 19885, April 23, 1997) as applying
only to those regulatory actions that concern health or safety risks,
such that the analysis required under section 5-501 of the EO has the
potential to influence the regulation. This action is not subject to EO
13045 because it does not establish an environmental standard intended
to mitigate health or safety risks.
H. Executive Order 13211: Actions Concerning Regulations That
Significantly Affect Energy Supply, Distribution, or Use
This action is not a ``significant energy action'' as defined in
Executive Order 13211 (66 FR 28355 (May 22, 2001)), because it is not
likely to have a significant adverse effect on the supply,
distribution, or use of energy. This final rule has a labeling
requirement, a prohibition against the use of gasoline containing more
than 10 vol% ethanol in vehicles, engines and equipment not covered by
the partial waiver decisions, a PTD requirement; and a survey
requirement.
There is no cost for the prohibition. The cost of the label is
estimated at $5 per year per service station. This is a tiny fraction
of the station's annual sales, and is not expected to significantly
affect energy distribution. The cost of the PTD requirement is
estimated at $0.45 million per year. This cost is a one-time cost to
reformat PTDs amortized over 15 years; any additional costs are
expected to be insignificant. The total cost of the survey requirements
is estimated to be $2.15 million per year. The projected total cost of
the final provisions is $3.64 million per year (see section IV for a
more detailed discussion of these estimated costs). These costs are not
expected to increase the cost of energy production or distribution in
excess of one percent. Therefore, this final action is not expected to
have a significant adverse energy effect.
I. National Technology Transfer and Advancement Act
Section 12(d) of the National Technology Transfer and Advancement
Act of 1995 (``NTTAA''), Public Law 104-113, 12(d) (15 U.S.C. 272 note)
directs EPA to use voluntary consensus standards in its regulatory
activities unless to do so would be inconsistent with applicable law or
otherwise impractical. Voluntary consensus standards are technical
standards (e.g., materials specifications, test methods, sampling
procedures, and business practices) that are developed or adopted by
voluntary consensus standards bodies. NTTAA directs EPA to provide
Congress, through OMB, explanations when the Agency decides not to use
available and applicable voluntary consensus standards.
This action does not involve technical standards. Therefore, EPA
did not consider the use of any voluntary consensus standards.
J. Executive Order 12898: Federal Actions To Address Environmental
Justice in Minority Populations and Low-Income Populations
Executive Order (EO) 12898 (59 FR 7629 (Feb. 16, 1994)) establishes
Federal executive policy on environmental justice. Its main provision
directs Federal agencies, to the greatest extent practicable and
permitted by law, to make environmental justice part of their mission
by identifying and addressing, as appropriate, disproportionately high
and adverse human health or environmental effects of their programs,
policies, and activities on minority populations and low-income
populations in the United States.
EPA has determined that this final rule will not have
disproportionately high and adverse human health or environmental
effects on minority or low-income populations because it increases the
level of environmental protection for all affected populations without
having any disproportionately high and adverse human health or
environmental effects on any population, including any minority or low-
income population. This action would affect all gasoline stations that
choose to sell E15 and therefore will not affect any particular area
disproportionately.
K. Congressional Review Act
The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the
Small Business Regulatory Enforcement Fairness Act of 1996, generally
provides that before a rule may take effect, the agency promulgating
the rule must submit a rule report, which includes a copy of the rule,
to each House of the Congress and to the Comptroller General of the
United States. EPA will submit a report containing this rule and other
required information to the U.S. Senate, the U.S. House of
Representatives, and the Comptroller General of the United States prior
to publication of the rule in the Federal Register. A Major rule cannot
take effect until 60 days after it is published in the Federal
Register. This action is not a ``major rule'' as defined by 5 U.S.C.
804(2). This rule will be effective August 24, 2011.
VI. Legal Authority and Judicial Review
A. Legal Authority
As explained above, we are finalizing the misfueling mitigation
measures pursuant to our authority under CAA section 211(c)(1). This
section gives EPA authority to ``control or prohibit the manufacture,
introduction into commerce, offering for sale, or sale'' of any fuel or
fuel additive (A) Whose emission products, in the judgment of the
Administrator, cause or contribute to air pollution ``which may be
reasonably anticipated to endanger public health or welfare'' or (B)
whose emission products ``will impair to a significant degree the
performance of any emission control device or system which is in
general use, or which the Administrator finds has been developed to a
point where in a reasonable time it would be in general use'' were the
fuel control or prohibition adopted. In Section VII \36\ of the
proposed rule, we explained how under section 211(c)(1), EPA may adopt
a fuel control if at least one of the two criteria above is met. We
also explained that we were proposing the misfueling mitigation
measures based on both of these criteria. We stated that under section
211(c)(1)(B), we believed that E15 would significantly impair the
emission control systems used in MY2000 and older light-duty motor
vehicles, heavy-duty gasoline engines and vehicles, highway and off-
highway motorcycles, and all nonroad products. This led to our
conclusion that under section 211(c)(1)(A), the likely result would be
increased HC, CO and NOX emissions when these particular
engines, vehicles and nonroad products use E15.
---------------------------------------------------------------------------
\36\ Section VII. ``What is our legal authority for proposing
these misfueling mitigation measures?'' 75 FR 68044, 68081 (November
4, 2010).
---------------------------------------------------------------------------
EPA received no comments on our analysis in Section VII during the
public comment period. Therefore, EPA is finalizing these misfueling
mitigation measures under our authority in section
[[Page 44443]]
211(c)(1). We fully include by reference our analysis in Section VII of
the proposed rule as our basis for doing so since our rationale is the
same for this final action.
B. Judicial Review
Under section 307(b)(1) of the Clean Air Act (CAA), judicial review
of these final rules is available only by filing a petition for review
in the United States Court of Appeals for the District of Columbia
Circuit by September 23, 2011. Under section 307(b)(2) of the CAA, the
requirements established by these final rules may not be challenged
separately in any civil or criminal proceedings brought by EPA to
enforce these requirements.
Section 307(d)(7)(B) of the CAA further provides that ``[o]nly an
objection to a rule or procedure which was raised with reasonable
specificity during the period for public comment (including any public
hearing) may be raised during judicial review.'' This section also
provides a mechanism for us to convene a proceeding for
reconsideration, ``[i]f the person raising an objection can demonstrate
to the EPA that it was impracticable to raise such objection within
[the period for public comment] or if the grounds for such objection
arose after the period for public comment (but within the time
specified for judicial review) and if such objection is of central
relevance to the outcome of the rule.'' Any person seeking to make such
a demonstration to us should submit a Petition for Reconsideration to
the Office of the Administrator, U.S. EPA, Room 3000, Ariel Rios
Building, 1200 Pennsylvania Ave., NW., Washington, DC 20460, with a
copy to both the person(s) listed in the preceding FOR FURTHER
INFORMATION CONTACT section, and the Associate General Counsel for the
Air and Radiation Law Office, Office of General Counsel (Mail Code
2344A), U.S. EPA, 1200 Pennsylvania Ave., NW., Washington, DC 20460.
List of Subjects in 40 CFR Part 80
Environmental protection, Air pollution control, Fuel additives,
Diesel, Gasoline, Imports, Labeling, Motor vehicle pollution,
Penalties, Reporting and recordkeeping requirements.
Dated: June 23, 2011.
Lisa P. Jackson,
Administrator.
For the reasons set forth in the preamble, 40 CFR part 80 is
amended as follows:
PART 80--REGULATION OF FUEL AND FUEL ADDITIVES
0
1. The authority citation for part 80 continues to read as follows:
Authority: 42 U.S.C. 7414, 7542, 7545, and 7601(a).
0
2. Section 80.40(c)(1) is amended to read as follows:
Sec. 80.40 Fuel certification procedures.
* * * * *
(c)(1) Adjusted VOC gasoline for purposes of the general
requirements in 80.65(d)(2)(ii), and the certification procedures in
this section is gasoline that contains 10 to 15 volume percent ethanol,
or RBOB intended for blending with 10 to 15 volume percent ethanol,
that is intended for use in the areas described at 80.70(f) and (i),
and is designated by the refiner as adjusted VOC gasoline subject to
less stringent VOC standards in 80.41(e) and (f). In order for adjusted
VOC gasoline to qualify for the regulatory treatment specified in
80.41(e) and (f), reformulated gasoline must contain denatured,
anhydrous ethanol. The concentration of the ethanol, excluding the
required denaturing agent, must be at least 9 percent and no more than
15 percent (by volume) of the gasoline. The ethanol content of the
gasoline shall be determined by use of one of the testing methodologies
specified in 80.46(g).
* * * * *
0
3. Section 80.45 is amended by adding a new paragraph (c)(1)(iii)(C)
and by revising paragraphs (f)(1)(i) and (f)(1)(ii) to read as follows:
Sec. 80.45 Complex emissions model.
* * * * *
(c) * * *
(1) * * *
(iii) * * *
(C) During Phase II, fuels with an oxygen concentration greater
than 4.0 weight percent and not more than 5.8 weight percent shall be
evaluated with the OXY fuel parameter set equal to 4.0 percent by
weight when calculating VOCE using the equations described in
paragraphs (c)(1)(i) and (c)(1)(ii) of this section.
* * * * *
(f) * * *
(1) * * *
(i) For reformulated gasolines:
------------------------------------------------------------------------
Fuel property Acceptable range
------------------------------------------------------------------------
Oxygen.................................... 0.0-5.8 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 percent
evaporated.
E300...................................... 70.0-100.0 percent
evaporated.
Aromatics................................. 0.0-50.0 volume percent.
Olefins................................... 0.0-25.0 volume percent.
Benzene................................... 0.0-2.0 volume percent.
------------------------------------------------------------------------
(ii) For conventional gasoline:
------------------------------------------------------------------------
Fuel property Acceptable range
------------------------------------------------------------------------
Oxygen.................................... 0.0-5.8 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 evaporated
percent.
E300...................................... 70.0-100.0 evaporated
percent.
Aromatics................................. 0.0-55.0 volume percent.
Olefins................................... 0.0-30.0 volume percent.
Benzene................................... 0.0-4.9 volume percent.
------------------------------------------------------------------------
* * * * *
0
4. A new subpart N is added to read as follows:
Subpart N--Additional Requirements for Gasoline-Ethanol Blends
Sec.
80.1500 Definitions.
80.1501 What are the labeling requirements that apply to retailers
and wholesale purchaser-consumers of gasoline-ethanol blends that
contain greater than 10.0 volume percent ethanol and not more than
15.0 volume percent ethanol?
80.1502 What are the survey requirements for gasoline-ethanol
blends?
80.1503 What are the product transfer document requirements for
gasoline-ethanol blends, gasolines, and conventional blendstocks for
oxygenate blending subject to this subpart?
80.1504 What acts are prohibited under this subpart?
80.1505 Who is liable for violations of this subpart?
80.1506 What penalties apply under this subpart?
80.1507 What are the defenses for acts prohibited under this
subpart?
80.1508 What evidence may be used to determine compliance with the
requirements of this subpart and liability for violations of this
subpart?
[[Page 44444]]
Subpart N--Additional Provisions for Gasoline-Ethanol Blends
Sec. 80.1500 Definitions.
The definitions in Sec. 80.2 apply to this subpart. For purposes
of this subpart only:
Blendstock for oxygenate blending means gasoline blendstock which
could become gasoline solely upon the addition of an oxygenate.
Conventional blendstock for oxygenate blending means gasoline
blendstock which could become conventional gasoline solely upon the
addition of an oxygenate.
Carrier has the same meaning as defined in Sec. 80.2(t).
Conventional gasoline has the same meaning as defined in Sec.
80.2(ff).
E0 means a gasoline that contains no ethanol.
E10 means a gasoline-ethanol blend that contains at least 9.0 and
no more than 10.0 volume percent ethanol.
E15 means a gasoline-ethanol blend that contains greater than 10.0
volume percent ethanol and not more than 15.0 volume percent ethanol.
EX means a gasoline-ethanol blend that contains less than 9 volume
percent ethanol where X equals the maximum volume percent ethanol in
the gasoline-ethanol blend.
EXX means a gasoline-ethanol blend above E15 where XX equals the
maximum volume percent ethanol in the gasoline-ethanol blend.
Ethanol blender has the same meaning as defined in Sec. 80.2(v).
Ethanol importer means a person who brings ethanol into the United
States (including from the Commonwealth of Puerto Rico, the Virgin
Islands, Guam, American Samoa, and the Northern Mariana Islands) for
use in motor vehicles and nonroad engines.
Ethanol producer means any person who owns, leases, operates,
controls, or supervises a facility that produces ethanol for use in
motor vehicles or nonroad engines.
Flex-fuel vehicle has the same meaning as flexible-fuel vehicle as
defined in Sec. 86.1803-01.
Fuel dispenser means the apparatus used to dispense fuel into motor
vehicles or nonroad vehicles, engines or equipment, or into a portable
fuel container as defined at Sec. 59.680.
Gasoline has the same meaning as defined in Sec. 80.2(c).
Gasoline importer means an importer as defined in Sec. 80.2(r)
that imports gasoline or gasoline blending stocks that could become
gasoline solely upon the addition of oxygenates.
Gasoline refiner means a refiner as defined as in Sec. 80.2(i)
that produces gasoline or gasoline blending stocks that could become
gasoline solely upon the addition of oxygenates.
Oxygenate blender has the same meaning as defined in Sec.
80.2(mm).
Oxygenate blending facility has the same meaning as defined in
Sec. 80.2(ll).
Regulatory control periods has the same meaning as defined in Sec.
80.27(a)(2)(ii) or in any State Implementation Plan (SIP) approved or
promulgated under Sec. Sec. 110 or 172 of the Clean Air Act.
Retail outlet has the same meaning as defined Sec. 80.2(j).
Retailer has the same meaning as defined in Sec. 80.2(k).
Survey series means the four quarterly surveys that comprise a
survey program.
Sampling strata means the three types of areas sampled during a
survey which include the following:
(1) Densely populated areas;
(2) Transportation corridors; and
(3) Rural areas.
Wholesale purchaser-consumer has the same meaning as defined in
Sec. 80.2(o).
Sec. 80.1501 What are the labeling requirements that apply to
retailers and wholesale purchaser-consumers of gasoline-ethanol blends
that contain greater than 10.0 volume percent ethanol and not more than
15.0 volume percent ethanol?
(a) Any retailer or wholesale purchaser-consumer who sells,
dispenses, or offers for sale or dispensing, gasoline-ethanol blends
that contain greater than 10.0 volume percent ethanol and not more than
15.0 volume percent ethanol shall affix the following conspicuous and
legible label to the fuel dispenser:
Attention
E15
Up to 15% ethanol
Use only in
2001 and newer passenger vehicles
Flex-fuel vehicles
Don't use in other vehicles, boats, or gasoline-powered equipment.
It may cause damage and is prohibited by Federal law.
(b) Labels under this section shall meet the following requirements
for appearance and placement:
(1) Dimensions. The label shall measure 3 and \5/8\ inches wide by
3 and \1/8\ inches high.
(2) Placement. The label shall be placed on the upper two-thirds of
each fuel dispenser where the consumer will see the label when
selecting a fuel to purchase. For dispensers with one nozzle, the label
shall be placed above the button or other control used for selecting
E15, or in any other manner which clearly indicates which control is
used to select E15. For dispensers with multiple nozzles, the label
shall be placed in the location that is most likely to be seen by the
consumer at the time of selection of E15.
(3) Text. The text shall be justified and the fonts and backgrounds
shall be as described in paragraphs (b)(3)(i) through (vi) and
(b)(4)(i) through (iv) of this section.
(i) The word ``Attention'' shall be in 20-point, orange, Helvetica
Neue LT 77 Bold Condensed font, and shall be placed in the top 1.25
inches of the label as further described in (b)(4)(iii) of this
section.
(ii) The word ``E15'' shall be in 42-point, orange, Helvetica Black
font, and shall be placed in the top 1.25 inches of the label.
(iii) The ethanol content: ``Up to 15% ethanol'' shall be in 14-
point, center-justified, orange, Helvetica Black font in the top 1.25
inches of the label, below the word E15.
(iv) The words ``Use only in'' shall be in 20-point, left-
justified, black, Helvetica Bold font in the top 1.25 inches of the
label.
(v) The words, and symbols `` 2001 and newer passenger
vehicles Flex-fuel vehicles'' shall be in 14-point, left-
justified, black, Helvetica Bold font.
(vi) The remaining two sentences shall be in 12-point, left-
justified, Helvetica Bold font, except that the word ``prohibited'' in
the second sentence shall be in 12-point, black, Helvetica Black
Italics font.
(4) Color. (i) The background of the top 1.25 inches of the label
shall be black.
(ii) The background of the bottom 1.75 inches of the label shall be
orange.
(iii) The label shall have on the upper left side of the label a
diagonal orange stripe that is .3125 inches tall. The stripe shall be
placed as far down and across the label as is necessary so as to as to
create a black triangle of the upper left corner of the label whose
vertical side is contiguous to the vertical edge of the label and
is.4375 inches long, and whose horizontal side is contiguous to the
horizontal edge of the label and is 1.0 inches long. The word
``Attention'' shall be centered to the upper edge of this stripe.
(5) Alternative labels to those specified in this section may be
used if approved by EPA in advance. Such labels must contain all of the
informational elements specified in paragraph (a) of this section, and
must use colors and other design elements similar in substance and
appearance to the label required by this section. Such labels may
differ in size and shape from
[[Page 44445]]
the label required by this section only to a small degree, except to
the extent a larger label is necessary to accommodate additional
information or translation of label information.
(i) If you use U.S. Mail, send a request for approval of an
alternative label to: U.S. EPA, Attn: E15 Alternative Label Request,
6406J, 1200 Pennsylvania Avenue, NW., Washington, DC 20460.
(ii) If you use an overnight or courier service, send a request for
approval of an alternative label to: U.S. EPA, Attn: E15 Alternative
Label Request, 6406J, 1310 L Street, NW., 6th Floor, Washington, DC
20005. (202) 343-9038.
Sec. 80.1502 What are the survey requirements related to gasoline-
ethanol blends?
Any gasoline refiner, gasoline importer, ethanol blender, ethanol
producer, or ethanol importer who manufactures, introduces into
commerce, sells or offers for sale E15, gasoline, blendstock for
oxygenate blending, ethanol, or gasoline-ethanol blend that is intended
for use in or as E15 shall comply with the survey program requirements
in either paragraph (a) or paragraph (b) of this section. These same
parties are also subject to paragraphs (c), (d) and (e) of this section
regardless of whether they choose the survey program requirements in
paragraph (a) or paragraph (b) of this section. In the case of ethanol
producers and ethanol importers, the ethanol that is produced or
imported shall be deemed as intended for use in E15 unless an ethanol
producer or an ethanol importer demonstrates that it was not intended
for such use.
(a) Survey option 1. In order to satisfy the survey program
requirements, any gasoline refiner, gasoline importer, ethanol blender,
ethanol producer, or ethanol importer who manufactures, introduces into
commerce, sells or offers for sale E15, gasoline, blendstock for
oxygenate blending, ethanol, or gasoline-ethanol blend intended for use
in or as E15 shall properly conduct a program of compliance surveys in
accordance with a survey program plan which has been approved by EPA in
all areas which may be reasonably expected to be supplied with their
gasoline, blendstock for oxygenate blending, ethanol, or gasoline-
ethanol blend if these may be used to manufacture E15 or as E15 at any
time during the year. Such approval shall be based upon the survey
program plan meeting the following criteria:
(1) The survey program shall consist of at least quarterly surveys
which shall occur during the following time periods in every year
during which the gasoline refiner, gasoline importer, ethanol blender,
ethanol producer, or ethanol importer introduces E15 into commerce:
(i) One survey during the period January 1 through March 31;
(ii) One survey during the period April 1 through June 30;
(iii) One survey during the period July 1 through September 30; and
(iv) One survey during the period October 1 through December 31.
(2) The survey program plan shall meet all of the requirements of
paragraph (b), except paragraphs (b)(4)(ii) and (b)(4)(v) of this
section. The survey program plan shall specify the sampling strata,
clusters and area, and number of samples to be included.
Notwithstanding paragraph (b)(2) of this section, in order to comply
with this paragraph the survey plan need not be conducted by a
consortium.
(b) Survey option 2.
(1) To comply with the requirements under this paragraph (b), any
gasoline refiner, gasoline importer, ethanol blender, ethanol producer,
or ethanol importer who manufactures, introduces into commerce, sells
or offers for sale E15, gasoline, blendstock for oxygenate blending,
ethanol, or gasoline-ethanol blend intended for use in or as E15 must
participate in a consortium which arranges to have an independent
survey association conduct a statistically valid program of compliance
surveys pursuant to a survey program plan which has been approved by
EPA, in accordance with the requirements of paragraphs (b)(2) through
(b)(4) and (b)(6) of this section.
(2) The consortium survey program under this paragraph (b) must be:
(i) Planned and conducted by a survey association that is
independent of the ethanol blenders, ethanol producers, ethanol
importers, gasoline refiners, and/or gasoline importers that arrange to
have the survey conducted. In order to be considered independent:
(A) Representatives of the survey association shall not be an
employee of any ethanol blender, ethanol producer, ethanol importer,
gasoline refiner, or gasoline importer;
(B) The survey association shall be free from any obligation to or
interest in any ethanol blender, ethanol producer, ethanol importer,
gasoline refiner, or gasoline importer; and
(C) The ethanol blenders, ethanol producers, ethanol importers,
gasoline refiners, and/or gasoline importers that arrange to have the
survey conducted shall be free from any obligation to or interest in
the survey association.
(ii) Conducted at retail outlets that sell gasoline; and
(iii) Represent all gasoline dispensed nationwide.
(3) Independent Survey Association Requirements. The consortium
described in paragraph (b)(1) of this section shall require the
independent survey association conducting the surveys to:
(i) Submit to EPA for approval each calendar year a proposed survey
program plan in accordance with the requirements of paragraph (b)(4) of
this section.
(ii) Obtain samples of gasoline offered for sale at gasoline retail
outlets in accordance with the survey program plan approved under this
paragraph (b), or immediately notify EPA of any refusal of retail
outlets to allow samples to be taken.
(iii) Test, or arrange to be tested, the samples required under
paragraph (b)(3)(ii) of this section for Reid vapor pressure (RVP), and
oxygenate content as follows:
(A) Samples collected at retail outlets shall be shipped the same
day the samples are collected via ground service to the laboratory and
analyzed for oxygenate content. Samples collected at a dispenser
labeled E15 in any manner, or at a tank serving such a dispenser, shall
also be analyzed for RVP. Such analysis shall be completed within 10
days after receipt of the sample in the laboratory. Nothing in this
section shall be interpreted to require RVP testing of a sample from
any dispenser or tank serving it unless the dispenser is labeled E15 in
any manner.
(B) Any laboratory to be used by the independent survey association
for oxygenate or RVP testing shall be approved by EPA and its test
method for determining oxygenate content shall be a method permitted
under Sec. 80.46(g), and its test method for determining RVP shall be
the method permitted under Sec. 80.46(b).
(iv) In the case of any test that yields a result that does not
match the label affixed to the product (e.g., a sample greater than
15.0 volume percent ethanol dispensed from a fuel dispenser labeled as
``E15'' or a sample containing greater than 10.0 volume percent ethanol
and not more than 15.0 volume percent ethanol dispensed from a fuel
dispenser not labeled as ``E15''), or the RVP standard of Sec.
80.27(a)(2), the independent survey association shall, within 24 hours
after the laboratory receives the sample, send notification of the test
result as follows:
(A) In the case of a sample collected at a retail outlet at which
the brand name of a gasoline refiner or gasoline importer is displayed,
to the gasoline refiner or gasoline importer, and EPA.
[[Page 44446]]
This initial notification to a gasoline refiner or gasoline importer
shall include specific information concerning the name and address of
the retail outlet, contact information, the brand, and the ethanol
content, and the RVP if required, of the sample.
(B) In the case of a sample collected at other retail outlets, to
the retailer and EPA, and such notice shall contain the same
information as in paragraph (b)(3)(iv)(A) of this section.
(C) The independent survey association shall provide notice to the
identified contact person or persons for each party in writing (which
includes e-mail or facsimile) and, if requested by the identified
contact person, by telephone.
(v) Confirm that each fuel dispenser sampled is labeled as required
in Sec. 80.1501 by confirming that:
(A) The label meets the appearance and content requirements of
Sec. 80.1501.
(B) The label is located on the fuel dispenser according to the
requirements in Sec. 80.1501.
(vi) In the case of a fuel dispenser that is improperly labeled, or
whose fuel does not meet the RVP standards of Sec. 80.27(a)(2) the
survey association shall provide notice as provided in paragraphs
(b)(2)(iv)(A) through (C) of this section.
(vii) Provide to EPA quarterly and annual summary survey reports
which include the information specified in paragraph (b)(5) of this
section.
(viii) Maintain all records relating to the surveys conducted under
this paragraph (b) for a period of at least five (5) years.
(ix) Permit any representative of EPA to monitor at any time the
conducting of the surveys, including sample collection, transportation,
storage, and analysis.
(4) Survey Plan Design Requirements. The proposed survey program
plan required under paragraph (b)(3)(i) of this section shall, at a
minimum, include the following:
(i) Number of Surveys. The survey program plan shall include four
quarterly surveys each calendar year. The four quarterly surveys
collectively are called the survey series as defined in Sec. 80.1500.
(ii) Sampling Areas. The survey program plan shall include sampling
in all sampling strata, as defined in Sec. 80.1500, during each
survey. These sampling strata shall be further divided into discrete
sampling areas or clusters. Each survey shall include sampling in at
least 40 sampling areas in each stratum which are randomly selected.
(iii) No advance notice of surveys. The survey plan shall include
procedures to keep the identification of the sampling areas that are
included in any survey plan confidential from any regulated party prior
to the beginning of a survey in an area. However, this information
shall not be kept confidential from EPA.
(iv) Retail outlet selection.
(A) The retail outlets to be sampled in a sampling area shall be
selected from among all retail outlets in the sampling area that sell
gasoline, with the probability of selection proportionate to the volume
of gasoline sold at the retail outlets; the sample should also include
retail outlets with different brand names as well as those retail
outlets that are unbranded.
(B) In the case of any retail outlet from which a sample of
gasoline was collected during a survey and determined to have an
ethanol content that does not match the fuel dispenser label (e.g. a
sample greater than 15.0 volume percent ethanol dispensed from a fuel
dispenser labeled as ``E15'' or a sample with greater than 10.0 volume
percent ethanol and not more than 15.0 volume percent ethanol dispensed
from a fuel dispenser not labeled as ``E15'') or determined to have a
dispenser containing fuel whose RVP does not comply with Sec.
80.27(a)(2), that retail outlet shall be included in the subsequent
survey.
(C) One sample of each product dispensed as gasoline shall be
collected at each retail outlet, and separate samples shall be taken
that represent the gasoline contained in each gasoline storage tank
unless collection of separate samples is not practicable.
(v) Number of samples.
(A) The minimum number of samples to be included in the survey plan
for each calendar year shall be calculated as follows:
[GRAPHIC] [TIFF OMITTED] TR25JY11.003
Where:
n = minimum number of samples in a year-long survey series. However,
in no case shall n be smaller than 7,500.
Z[alpha] = upper percentile point from the normal distribution to
achieve a one-tailed 95% confidence level (5% [alpha]-level). Thus,
Z[alpha] equals 1.645.
Z[beta] = upper percentile point to achieve 95% power. Thus, Z[beta]
equals 1.645.
[oslash]l = the maximum proportion of non-compliant
stations for a region to be deemed compliant. In this test, the
parameter needs to be 5% or greater, i.e., 5% or more of the
stations, within a stratum such that the region is considered non-
compliant. For this survey, [oslash]1 will be 5%.
[oslash]o= the underlying proportion of non-compliant stations in a
sample. For the first survey plan, [oslash]o = will be 2.3%. For
subsequent survey plans, [oslash]o = will be the average of the
proportion of stations found to be non-compliant over the previous
four surveys.
Stn = number of sampling strata. For purposes of this
survey program, Stn equals 3.
Fa = adjustment factor for the number of extra samples
required to compensate for collected samples that cannot be included
in the survey, based on the number of additional samples required
during the previous four surveys. However, in no case shall the
value of Fa be smaller than 1.1.
Fb = adjustment factor for the number of samples required
to resample each retail outlet with test results exceeding the
labeled amount (e.g., a sample greater than 15.0 volume percent
ethanol dispensed from a fuel dispenser labeled as ``E15'', a sample
with greater than 10.0 volume percent ethanol and not more than 15.0
volume percent ethanol dispensed from a fuel dispenser not labeled
as ``E15''), or a sample dispensed from a fuel dispenser labeled as
``E15'' with greater than the applicable seasonal and geographic RVP
pursuant to Sec. 80.27, based on the rate of resampling required
during the previous four surveys. However, in no case shall the
value of Fb be smaller than 1.1.
Sun = number of surveys per year. For purposes of this
survey program, Sun equals 4.
(B) The number of samples determined pursuant to paragraph
(b)(4)(v)(A) of this section, after being incremented as necessary to
allocate whole numbers of samples to each cluster, shall be distributed
approximately equally for the quarterly surveys conducted during the
calendar year.
(5) Summary survey reports. The quarterly and annual summary survey
reports required under paragraph (b)(3)(vii) of this section shall
include the following information:
(i) An identification of the parties that are participating in the
survey.
(ii) The identification of each sampling area included in a survey
and
[[Page 44447]]
the dates that the samples were collected in that area.
(iii) For each retail outlet sampled:
(A) The identification of the retail outlet;
(B) The gasoline refiner or gasoline importer brand name displayed,
if any;
(C) The fuel dispenser labeling (e.g., ``E15'');
(D) The sample test result for oxygenate content, and RVP result,
if any;
(E) The test method used to determine oxygenate content under Sec.
80.46(g); and
(F) The test method used to determine RVP under Sec. 80.46(b).
(iv) Ethanol level summary statistics by brand and unbranded for
each sampling area, strata, and survey series. These summary statistics
shall:
(A) Include the number of samples, the average, median and range of
ethanolcontent, expressed in volume percent.
(B) [Reserved].
(v) The quarterly reports required under this paragraph (b)(5) are
due 60 days following the end of the quarter. The annual reports
required under this paragraph (b)(5) are due 60 days following the end
of the calendar year.
(vi) The reports required under this paragraph (b)(5) shall be
submitted to EPA in an electronic spreadsheet.
(c) Procedures for obtaining approval of survey plan and providing
required notices. The first year in which a survey program is conducted
may consist of only a portion of a calendar year ending on December 31
(i.e., in the initial year, a survey program may begin on a date after
January 1, but would still end on December 31). Subsequent survey
programs shall be conducted on a calendar year basis. The procedure for
obtaining EPA approval of a survey program plan under paragraph (b) or
paragraph (c) of this section is as follows:
(1) For the first year in which a survey will be conducted, a
survey program plan that complies with the requirements of paragraph
(a) or paragraph (b) of this section must be submitted to EPA no later
than 60 days prior to the date on which the survey program is to begin.
(2) For subsequent years in which a survey will be conducted, a
survey program plan that complies with the requirements of paragraph
(a) or paragraph (b) of this section must be submitted to EPA no later
than November 1 of the year preceding the calendar year in which the
survey will be conducted.
(3) The survey program plan must be signed by a responsible officer
of the consortium which arranges to have an independent surveyor
conduct the survey program.
(4) The survey program plan must be sent to the following address:
Director, Compliance and Innovative Strategies Division, U.S.
Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Mail Code
6506J, Washington, DC 20460.
(5) EPA will send a letter to the party submitting the survey
program plan that indicates whether EPA approves or disapproves the
survey plan.
(6) The approving official for a survey plan under this section is
the Director of the Compliance and Innovative Strategies Division,
Office of Transportation and Air Quality.
(7) Any notifications or reports required to be submitted to EPA
under this section must be directed to the official designated in
paragraph (b)(6)(iv) of this section.
(d) Independent surveyor contract.
(1) For the first year in which a survey program will be conducted,
no later than 30 days preceding the start of the survey, the contract
with the independent surveyor shall be in effect, and an amount of
money necessary to carry out the entire survey plan shall be paid to
the independent surveyor or placed into an escrow account with
instructions to the escrow agent to pay the money to the independent
surveyor during the course of the conduct of the survey plan.
(2) For subsequent years in which a survey program will be
conducted, no later than December 1 of the year preceding the year in
which the survey will be conducted, the contract with the independent
surveyor shall be in effect, and an amount of money necessary to carry
out the entire survey plan shall be paid to the independent surveyor or
placed into an escrow account with instructions to the escrow agent to
pay the money to the independent surveyor during the course of the
conduct of the survey plan.
(3) For the first year in which a survey program will be conducted,
no later than 15 days preceding the start of the survey EPA must
receive a copy of the contract with the independent surveyor and proof
that the money necessary to carry out the survey plan has either been
paid to the independent surveyor or placed into an escrow account; if
the money has been placed into an escrow account, a copy of the escrow
agreement must to be sent to the official designated in paragraph
(b)(6)(iv) of this section.
(4) For subsequent years in which a survey program will be
conducted, no later than December 15 of the year preceding the year in
which the survey will be conducted, EPA must receive a copy of the
contract with the independent surveyor and proof that the money
necessary to carry out the survey plan has either been paid to the
independent surveyor or placed into an escrow account; if placed into
an escrow account, a copy of the escrow agreement must be sent to the
official designated in paragraph (b)(6)(iv) of this section.
(e) Consequences of failure to fulfill requirements. A failure to
fulfill or cause to be fulfilled any of the requirements of this
section is a prohibited act under Clean Air Act section 211(c) and
Sec. 80.1504.
(1) EPA may revoke its approval of a survey plan under this section
for cause, including, but not limited to, an EPA determination that the
approved survey plan has proved to be inadequate in practice.
(2) EPA may void ab initio its approval of a survey plan if EPA's
approval was based on false information, misleading information, or
incomplete information, or if there was a failure to fulfill, or cause
to be fulfilled, any of the requirements of the survey plan.
Sec. 80.1503 What are the product transfer document requirements for
gasoline-ethanol blends, gasolines, and conventional blendstocks for
oxygenate blending subject to this subpart?
(a) Product transfer documentation for conventional blendstock for
oxygenate blending, or gasoline transferred upstream of an ethanol
blending facility.
(1) In addition to any other product transfer document requirements
under 40 CFR part 80, on each occasion after October 31, 2011, when any
person transfers custody or title to any conventional blendstock for
oxygenate blending which could become conventional gasoline solely upon
the addition of ethanol, or gasoline upstream of an oxygenate blending
facility, as defined in Sec. 80.2(ll), the transferor shall provide to
the transferee product transfer 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 conventional blendstock for oxygenate blending
or gasoline being transferred;
(iv) The location of the conventional blendstock for oxygenate
blending or gasoline at the time of the transfer;
(v) The date of the transfer;
(vi) For gasoline during the regulatory control periods defined in
Sec. 80.27(a)(2)(ii) or any SIP approved or promulgated under
Sec. Sec. 110 or 172 of the Clean Air Act:
[[Page 44448]]
(A) The maximum RVP, as determined by a method permitted under
Sec. 80.46(c), stated in the following format: ``The RVP of this
gasoline does not exceed [fill in appropriate value]''; and
(B) For gasoline designed for the special provisions for gasoline-
ethanol blends in Sec. 80.27(d)(2), information about the ethanol
content and RVP in paragraphs (a)(1) through (a)(3) of this section,
with insertions as indicated:
(1) ``Suitable for the special RVP provisions for ethanol blends
that contain between 9 and 10 vol % ethanol.''
(2) ``The RVP of this blendstock/gasoline for oxygenate blending
does not exceed [Fill in appropriate value] psi.
(3) The use of this gasoline to manufacture a gasoline-ethanol
blend containing anything other than between 9 and 10 volume percent
ethanol may cause a summertime RVP violation.
(C) For gasoline not described in paragraph (a)(vi)(B) of this
section, information regarding the suitable ethanol content, stated in
the following format: ``Suitable for blending with ethanol at a
concentration of no more than 15 vol % ethanol.''
(2) The requirements in paragraph (a)(1) do not apply to
reformulated gasoline blendstock for oxygenate blending, as defined in
Sec. 80.2(kk), which are subject to the product transfer document
requirements of Sec. 80.69 and Sec. 80.77.
(b) Product transfer documentation for gasoline transferred
downstream of an oxygenate blending facility.
(1) In addition to any other product transfer document requirements
under 40 CFR part 80, on each occasion after October 31, 2011, when any
person transfers custody or title to any gasoline-ethanol blend
downstream of an oxygenate blending facility, as defined in Sec.
80.2(ll), except for transfers to the ultimate consumer, the transferor
shall provide to the transferee product transfer 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; and
(vi) One of the statements detailed in paragraph (b)(1)(vi)(A)
though (E) which accurately describes the gasoline-ethanol blend. The
information regarding the ethanol content of the fuel is required year-
round. The information regarding the RVP of the fuel is only required
for gasoline during the regulatory control periods.
(A) For gasoline containing no ethanol (E0), the following
statement; ``E0: Contains no ethanol. The RVP does not exceed [fill in
appropriate value] psi.''
(B) For gasoline containing less than 9.0 volume percent ethanol,
the following statement: ``EX--Contains up to X% ethanol. The RVP does
not exceed [fill in appropriate value] psi.'' The term X refers to the
maximum volume percent ethanol present in the gasoline.
(C) For gasoline containing between 9.0 and 10.0 volume percent
ethanol (E10), the following statement: ``E10: Contains between 9 and
10 vol % ethanol. The RVP does not exceed [fill in appropriate value]
psi. The 1.0 psi RVP waiver applies to this gasoline. Do not mix with
gasoline containing anything other than between 9 and 10 vol %
ethanol.''
(D) For gasoline containing greater than 10.0 volume percent and
not more than 15.0 volume percent ethanol (E15), the following
statement: ``E15: Contains up to 15 vol % ethanol. The RVP does not
exceed [fill in appropriate value] psi;'' or
(E) For all other gasoline that contains ethanol, the following
statement: ``EXX--Contains no more than XX% ethanol,'' where XX equals
the volume % ethanol.
(2) Except for transfers to truck carriers, retailers, or wholesale
purchaser-consumers, product codes may be used to convey the
information required under paragraph (b)(1) of this section if such
codes are clearly understood by each transferee.
(c) The records required by this section must be kept by the
transferor and transferee for five (5) years from the date they were
created or received by each party in the distribution system.
(d) On request by EPA, the records required by this section must be
made available to the Administrator or the Administrator's authorized
representative. For records that are electronically generated or
maintained, the equipment or software necessary to read the records
shall be made available, or, if requested by EPA, electronic records
shall be converted to paper documents.
Sec. 80.1504 What acts are prohibited under this subpart?
No person shall--
(a)(1) Sell, introduce, cause or permit the sale or introduction of
gasoline containing greater than 10.0 volume percent ethanol (i.e.,
greater than E10) into any model year 2000 or older light-duty gasoline
motor vehicle, any heavy-duty gasoline motor vehicle or engine, any
highway or off-highway motorcycle, or any gasoline-powered nonroad
engines, vehicles or equipment.
(2) Manufacture or introduce into commerce E15 in any calendar year
for use in an area prior to commencement of a survey approved under
80.1502 for that area.
(3) Notwithstanding paragraphs (a)(1) and (a)(2) of this section,
no person shall be prohibited from manufacturing, selling, introducing,
or causing or allowing the sale or introduction of gasoline containing
greater than 10.0 volume percent ethanol into any flex-fuel vehicle.
(b) Sell, offer for sale, dispense, or otherwise make available at
a retail or wholesale purchaser-consumer facility E15 that is not
correctly labeled in accordance with Sec. 80.1501;
(c) Fail to fully or timely implement, or cause a failure to fully
or timely implement, an approved survey required under Sec. 80.1502;
(d) Fail to generate, use, transfer and maintain product transfer
documents that accurately reflect the type of product, ethanol content,
maximum RVP, and other information required under Sec. 80.1503;
(e) Improperly blend, or cause the improper blending of, ethanol
into conventional blendstock for oxygenate blending, gasoline or
gasoline already containing ethanol, in a manner inconsistent with the
information on the product transfer document under Sec.
80.1503(a)(1)(vi) or Sec. 80.1503(b)(1)(vi);
(f) For gasoline during the regulatory control periods, combine any
gasoline or conventional blendstock for oxygenate blending intended for
blending with E10 that qualifies for the 1 psi allowance under the
special regulatory treatment as provided by Sec. 80.27(d) applicable
to 9-10 volume percent gasoline-ethanol blends with any gasoline or
conventional blendstock for oxygenate blending intended for blending
with E15, unless the resultant combination is designated, in its
entirety, as an E10 blendstock for oxygenate blending.
(g) For gasoline during the regulatory control periods, combine any
gasoline-ethanol blend containing E10 that qualifies for the 1 psi
allowance under the special regulatory treatment as provided by Sec.
80.27(d) applicable to 9-10 volume percent gasoline-ethanol blends,
with any gasoline containing E0 or any gasoline blend containing E15.
(h) Fail to meet any other requirement of this subpart.
[[Page 44449]]
(i) Cause another person to commit an act in violation of
paragraphs (a) through (h) of this section.
Sec. 80.1505 Who is liable for violations of this subpart?
(a) Persons liable. Any person who violates Sec. 80.1504(a)
through (i) is liable for the violation. In addition, when the gasoline
contained in any storage tank at any facility owned, leased, operated,
controlled or supervised by any gasoline refiner, gasoline importer,
oxygenate blender, carrier, distributor, reseller, retailer, or
wholesale purchaser-consumer is found in violation of the prohibitions
described in Sec. 80.1504(a), and (c) through (i), the following
persons shall be deemed in violation:
(1) Each gasoline refiner, gasoline 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 gasoline refiner or gasoline 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 gasoline refiner, gasoline 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.
(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 using direct or circumstantial evidence, that the carrier
caused the violation.
(b) For label violations under Sec. 80.1504(b), only the wholesale
purchaser-consumer or retailer and the branded gasoline refiner or
branded gasoline importer, if any, shall be liable.
(c) Each partner to a joint venture, or each owner of a facility
owned by two or more owners, is jointly and severally liable for any
violation of this subpart that occurs at the joint venture facility or
a facility that is owned by the joint owners, or a facility that is
committed by the joint venture operation or any of the joint owners of
the facility.
(d) Any parent corporation is liable for any violations of this
subpart that are committed by any of its solely-owned subsidiaries.
Sec. 80.1506 What penalties apply under this subpart?
(a) Any person under Sec. 80.1505 who is liable for a violation
under Sec. 80.1504 is subject to an administrative or civil penalty,
as specified in sections 205 and 211(d) of the Clean Air Act, for every
day of each such violation and the amount of economic benefit or
savings resulting from the violation.
(b)(1) Any violation of any requirement that pertains to the
ethanol content of gasoline 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 requirement
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
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 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 requirements that pertain to the ethanol content of
gasoline.
(2) For the purposes of this paragraph (b), the length of time the
gasoline in question remained in the gasoline distribution system shall
be deemed to be 25 days; unless the respective party or EPA
demonstrates by reasonably specific showings, using 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 25 days.
(c) Any violation of any affirmative requirement or prohibition not
included in paragraph (b) 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 each and
every day the prohibited activity continues shall constitute a separate
day of violation.
Sec. 80.1507 What are the defenses for acts prohibited under this
subpart?
(a) Defenses for prohibited activities.
(1) In any case in which a gasoline refiner, gasoline importer,
oxygenate blender, carrier, distributor, reseller, retailer, or
wholesale purchaser-consumer would be in violation under Sec.
80.1504(a), and (c) through (i) it shall be deemed not in violation if
it can demonstrate:
(i) That the regulated party or its employee or agent did not
commit, cause, or contribute to another person's causing the violation;
(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 program,
including a sampling and testing program, as described in paragraph (b)
of this section;
(B) A carrier may rely on the sampling and testing program carried
out by another party, including the party that owns the gasoline in
question, provided that the sampling and testing 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
(a)(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 gasoline refiner designed to prevent such action, and despite
periodic sampling and testing by the gasoline 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 gasoline refiner but engaged by the gasoline refiner
for transportation of gasoline, despite specification or inspection of
procedures and equipment by the gasoline refiner which are reasonably
calculated to prevent such action.
(ii) In this paragraph (a) of this section, to show that the
violation ``was caused'' by any of the specified actions the party must
demonstrate by reasonably specific showings using direct or
circumstantial evidence, that the violation was caused or must have
been caused by another.
(3) For label violations under Sec. 80.1504(b), the branded
gasoline refiner or branded gasoline importer shall not be deemed
liable if the requirements of paragraph (b)(4) of this section are met.
[[Page 44450]]
(b) Quality assurance program. In order to demonstrate an
acceptable quality assurance program for gasoline at all points in the
gasoline distribution network, other than at retail outlets and
wholesale purchaser-consumer facilities, a party must present evidence
of the following in addition to other regular appropriate quality
assurance procedures and practices.
(1) A periodic sampling and testing program to determine if the
gasoline contains applicable maximum and/or minimum volume percent of
ethanol.
(2) That on each occasion when gasoline is found in noncompliance
with one of the requirements referred to in paragraph (b)(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 requirements are achieved).
(3) An oversight program conducted by a carrier under paragraph
(b)(1) of this section need not include periodic sampling and testing
of gasoline in a tank truck operated by a common carrier, but in lieu
of such tank truck sampling and testing the common carrier shall
demonstrate evidence of an oversight program for monitoring compliance
with the requirements of Sec. 80.1504 relating to the transport or
storage of gasoline by tank truck, such as appropriate guidance to
drivers on compliance with applicable requirements and the periodic
review of records normally received in the ordinary course of business
concerning gasoline quality and delivery.
(4) The periodic sampling and testing program specified in
paragraph (b)(1) of this section shall be deemed to have been in effect
during the relevant time period for any party, including branded
gasoline refiners and branded gasoline importers, if:
(i) An EPA approved survey program under Sec. 80.1502 was in
effect and was implemented fully and properly;
(ii) Any retailer at which a violation was discovered allowed
survey inspectors to take samples and inspect labels; and
(iii) For truck loading terminals and truck distributors that
perform oxygenate blending, additional quality assurance procedures and
practices were in place, such as regular checks to reconcile volumes of
ethanol in inventory and regular checks of equipment for proper ethanol
blend rates.
Sec. 80.1508 What evidence may be used to determine compliance with
the requirements of this subpart and liability for violations of this
subpart?
(a) Compliance with the requirements of this subpart pertaining to
the ethanol content of gasoline shall be determined based on the
ethanol level of the gasoline, measured using the methodologies
specified in Sec. 80.46(g). Any evidence or information, including the
exclusive use of such evidence or information, may be used to establish
the ethanol content of gasoline if the evidence or information is
relevant to whether the ethanol content of gasoline would have been in
compliance with the requirements of this subpart if the appropriate
sampling and testing methodology had been correctly performed. Such
evidence may be obtained from any source or location and may include,
but is not limited to, test results using methods other than those
specified in Sec. 80.46(g), business records, and commercial
documents.
(b) Determinations of compliance with the requirements of this
subpart other than those pertaining to the ethanol content of gasoline,
and determinations of liability for any violation of this subpart, may
be based on information obtained from any source or location. Such
information may include, but is not limited to, business records and
commercial documents.
[FR Doc. 2011-16459 Filed 7-22-11; 8:45 am]
BILLING CODE 6560-50-P