[Federal Register Volume 90, Number 127 (Monday, July 7, 2025)]
[Rules and Regulations]
[Pages 29751-29760]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2025-11153]
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ENVIRONMENTAL PROTECTION AGENCY
40 CFR Part 80
[EPA-HQ-OAR-2024-0411; FRL-12015-02-OAR]
RIN 2060-AW46
Renewable Fuel Standard (RFS) Program: Partial Waiver of the 2024
Cellulosic Biofuel Volume Requirement
AGENCY: Environmental Protection Agency (EPA).
ACTION: Final rule.
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SUMMARY: EPA is partially waiving the 2024 cellulosic biofuel volume
requirement and revising the associated percentage standard under the
Renewable Fuel Standard (RFS) program due to a shortfall in cellulosic
biofuel production. This action also makes a minor revision to the
biogas provisions of the RFS program.
DATES: This rule is effective on September 5, 2025. The incorporation
by reference of certain other material listed in the rule was approved
by the Director of the Federal Register as of September 11, 2023.
ADDRESSES: EPA has established a docket for this action under Docket ID
No. EPA-HQ-OAR-2024-0411. All documents in the docket are listed on the
https://www.regulations.gov website. Although listed in the index, some
information is not publicly available, e.g., confidential business
information (CBI) or other information whose disclosure is restricted
by statute. Certain other material is not available on the internet and
will be publicly available only in hard copy form. Publicly available
docket materials are available electronically through https://www.regulations.gov.
FOR FURTHER INFORMATION CONTACT: For questions regarding this action,
contact Dallas Burkholder, Assessment and Standards Division, Office of
Transportation and Air Quality, Environmental Protection Agency, 2000
Traverwood Drive, Ann Arbor, MI 48105; telephone number: (734) 214-
4776; email address: [email protected].
SUPPLEMENTARY INFORMATION:
Does this action apply to me?
Entities potentially affected by this action are those involved
with the production, distribution, and sale of transportation fuels
(e.g., gasoline and diesel fuel) and renewable fuels (e.g., ethanol,
biodiesel, renewable diesel, and biogas). Potentially affected
categories include:
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Category NAICS \a\ code Examples of potentially affected entities
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Industry...................................... 211130 Natural gas liquids extraction and
fractionation.
Industry...................................... 221210 Natural gas production and distribution.
Industry...................................... 324110 Petroleum refineries (including importers).
Industry...................................... 325120 Biogases, industrial (i.e., compressed,
liquified, solid), manufacturing.
Industry...................................... 325193 Ethyl alcohol manufacturing.
Industry...................................... 325199 Other basic organic chemical manufacturing.
Industry...................................... 424690 Chemical and allied products merchant
wholesalers.
Industry...................................... 424710 Petroleum bulk stations and terminals.
Industry...................................... 424720 Petroleum and petroleum products wholesalers.
Industry...................................... 457210 Fuel dealers.
Industry...................................... 562212 Landfills.
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\a\ North American Industry Classification System (NAICS).
This table is not intended to be exhaustive, but rather provides a
guide for readers regarding entities potentially affected by this
action. This table lists the types of entities that EPA is now aware
could potentially be affected by this action. Other types of entities
not listed in the table could also be affected. To determine whether
your entity would be affected by this action, you should carefully
examine the applicability criteria in 40 CFR part 80. If you have any
questions regarding the applicability of this action to a particular
entity, consult the person listed in the FOR FURTHER INFORMATION
CONTACT section.
[[Page 29752]]
Preamble Acronyms and Abbreviations
Throughout this document the use of ``we,'' ``us,'' or ``our'' is
intended to refer to EPA. We use multiple acronyms and terms in this
preamble. While this list may not be exhaustive, to ease the reading of
this preamble and for reference purposes, EPA defines the following
terms and acronyms here:
BBD biomass-based diesel
CAA Clean Air Act
CG conventional gasoline
CNG compressed natural gas
CWC cellulosic waiver credit
LNG liquified natural gas
RBOB reformulated gasoline before oxygenate blending
RFG reformulated gasoline
RFS Renewable Fuel Standard
RIN Renewable Identification Number
RNG renewable natural gas
RVO Renewable Volume Obligation
Outline of This Preamble
I. Executive Summary
II. Statutory Background
A. The RFS Program and the Set Authority
B. Cellulosic Waiver Authority
III. Partial Waiver of the 2024 Cellulosic Biofuel Volume
Requirement
A. Implementation of the Cellulosic Waiver Authority
B. Economic Impact Analysis
C. Calculation of 2024 Cellulosic Biofuel Percentage Standard
IV. Change to Calculation of Cellulosic Waiver Credit Price
V. Measurement of Renewable CNG/LNG Using Documentation
VI. Severability
VII. Judicial Review
VIII. Statutory and Executive Order Reviews
A. Executive Order 12866: Regulatory Planning and Review
B. Executive Order 14192: Unleashing Prosperity Through
Deregulation
C. Paperwork Reduction Act (PRA)
D. Regulatory Flexibility Act (RFA)
E. Unfunded Mandates Reform Act (UMRA)
F. Executive Order 13132: Federalism
G. Executive Order 13175: Consultation and Coordination With
Indian Tribal Governments
H. Executive Order 13045: Protection of Children From
Environmental Health Risks and Safety Risks
I. Executive Order 13211: Actions Concerning Regulations That
Significantly Affect Energy Supply, Distribution, or Use
J. National Technology Transfer and Advancement Act (NTTAA) and
1 CFR Part 51
K. Congressional Review Act (CRA)
IX. Statutory Authority
I. Executive Summary
On July 12, 2023, EPA promulgated a rule establishing the RFS
volume requirements and percentage standards for 2023-2025 (the ``Set 1
Rule'').\1\ As part of that rulemaking, EPA projected that 1.09 billion
cellulosic Renewable Identification Numbers (RINs) would be generated
in 2024 and used that volume to establish the 2024 cellulosic biofuel
percentage standard of 0.63 percent.\2\ On December 12, 2024, EPA
proposed a rule to, among other things, partially waive the 2024
cellulosic biofuel volume requirement under the RFS program and revise
the associated 2024 cellulosic biofuel percentage standard due to a
projected shortfall in cellulosic biofuel production in 2024.\3\ In
this action, EPA is finalizing the proposed partial waiver of the 2024
cellulosic biofuel requirement and one RFS regulatory amendment. EPA
proposed several additional amendments to other RFS provisions, a
majority of which are not being finalized here but may instead be
addressed in a later action.
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\1\ 88 FR 44468 (July 12, 2023).
\2\ 40 CFR 80.1405(a).
\3\ 89 FR 100442 (December 12, 2024).
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Based on cellulosic (D3/D7) RIN generation data for 2024, we now
project that only 1.01 billion cellulosic RINs were generated in 2024,
a shortfall of 0.08 billion RINs from the 1.09 billion RINs projected
in the Set 1 Rule. Due to this shortfall and reasons further explained
in Sections II and III, we are partially waiving the 2024 cellulosic
biofuel volume requirement to 1.01 billion RINs (the projected
cellulosic RIN generation in 2024) using the Clean Air Act (CAA)
section 211(o)(7)(D) ``cellulosic waiver authority.'' In the proposal,
we proposed to utilize the CAA general waiver authority to partially
waive the 2024 cellulosic biofuel volume requirement and sought comment
on the use of the CAA cellulosic waiver authority. After further
consideration and in response to comments received, we have decided to
partially waive the 2024 cellulosic biofuel volume requirement using
the CAA cellulosic waiver authority. The cellulosic waiver authority is
specific to the cellulosic biofuel standard and its use is mandatory,
as described further in Section II.B. Use of the cellulosic waiver
authority also triggers the availability of cellulosic waiver credits
(CWCs) for 2024 as an additional compliance flexibility for obligated
parties. As discussed further in the response to comments (RTC)
document,\4\ we are not reducing the 2024 cellulosic biofuel volume
using the general waiver authority.
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\4\ ``Renewable Fuel Standard (RFS) Program Partial Waiver of
2024 Cellulosic Biofuel Volume Requirement: Response to Comments
Document,'' EPA-420-R-25-008, June 2025.
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The supply of advanced biofuel and total renewable fuel in 2024
exceeded the required volumes by a significant margin, despite the
shortfall in cellulosic biofuel. Given the surplus of 2024 BBD (D4) and
advanced (D5) RINs, we are not reducing the volumes for any of the
other categories of renewable fuel (i.e., biomass-based diesel (BBD),
advanced biofuel, and total renewable fuel). We are also not making any
changes to any of the 2025 RFS standards, which were also finalized in
the Set 1 Rule.\5\
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\5\ EPA is not reopening the 2025 RFS volumes and standards in
this proceeding, nor are we reopening any of the 2024 RFS volumes
and standards besides the 2024 cellulosic biofuel volume and
standard.
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Finally, we are also replacing the source of data for the wholesale
price of gasoline that is used to calculate the price of cellulosic
waiver credits (CWCs), as discussed in Section IV, as well as making a
minor revision to the biogas provisions of the RFS program, as
discussed in Section V.
II. Statutory Background
A. The RFS Program and the Set Authority
CAA section 211(o)(2)(B) establishes the framework by which EPA is
to establish annual, nationally applicable minimum volume requirements
for each of the four categories of renewable fuel that make up the RFS
program: cellulosic biofuel, BBD, advanced biofuel, and renewable fuel.
CAA section 211(o)(2)(B)(i) provided specific applicable volumes for
cellulosic biofuel, advanced biofuel, and renewable fuel for each year
from 2010 to 2022 and specific applicable volumes for BBD for each year
from 2010 to 2012.
For the years beyond those expressly enumerated (i.e., after 2022
for all categories), CAA section 211(o)(2)(B)(ii) provides that
applicable volumes are set by EPA in coordination with the United
States Department of Agriculture (USDA) and Department of Energy (DOE),
based on a review of the implementation of the RFS program to date, and
that EPA must analyze specific factors (e.g., the impact of the
production and use of renewable fuels on the environment, energy
security, the infrastructure of the United States, and job creation).
EPA calls this statutory authority to set volumes after 2022 its ``set
authority.'' CAA section 211(o)(2)(B)(ii) additionally provides that
under the set authority, EPA shall promulgate applicable volumes no
later than 14 months prior to the start of the relevant year.\6\
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\6\ ``The Administrator shall promulgate rules establishing the
applicable volumes under this clause no later than 14 months before
the first year for which such applicable volume will apply.'' CAA
section 211(o)(2)(B)(ii).
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[[Page 29753]]
This action concerns the 2024 cellulosic biofuel volume requirement
that was established in the Set 1 Rule, EPA's first RFS rule
promulgated under the set authority. In the Set 1 Rule, EPA established
the volume requirements for 2023-2025 using the set authority and
acknowledged that certain waivers may be available to adjust post-2022
volume requirements if the requisite statutory conditions are met.\7\
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\7\ 88 FR 44479 (July 12, 2023) (``While we are establishing
applicable volume requirements in this action for future years that
are achievable and appropriate based on our consideration of the
statutory factors, we retain our legal authority to waive volumes in
the future under the waiver authorities should circumstances so
warrant.'').
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B. Cellulosic Waiver Authority
The cellulosic waiver authority at CAA section 211(o)(7)(D)(i)
provides that ``[f]or any calendar year for which the projected volume
of cellulosic biofuel production is less than the minimum applicable
volume established under [CAA section 211(o)](2)(B)], as determined by
the Administrator based on the estimate provided under paragraph
(3)(A),'' EPA ``shall reduce the applicable volume of cellulosic
biofuel required under paragraph (2)(B) to the projected volume
available during that calendar year'' and that this reduction shall be
made ``not later than November 30 of the preceding calendar year.'' For
those years in which EPA ``makes such a reduction,'' the statute
further provides that EPA may also ``reduce the applicable volume of
renewable fuel and advanced biofuels requirement . . . by the same or a
lesser volume.'' As such, even when EPA exercises its cellulosic waiver
authority, the determination of whether to correspondingly reduce the
total renewable fuel or advanced biofuel requirements is discretionary.
As recognized by EPA in the Set 1 Rule, there may be situations in
which the CAA section 211(o)(7)(D) cellulosic waiver authority is
available to waive cellulosic biofuel volume requirements after
2022.\8\
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\8\ Section 2.2, ``Renewable Fuel Standard (RFS) Program:
Standards for 2023-25 and Other Changes, Response to Comments,''
EPA-420-R-23-014, June 2023 (``Set 1 Rule RTC'').
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When EPA determines that the projected volume of cellulosic biofuel
production for a given year will be less than the annual applicable
volume established under CAA section 211(o)(2)(B), EPA is then required
to reduce the applicable volume of cellulosic biofuel for that calendar
year. Pursuant to this provision, EPA set the cellulosic biofuel volume
requirement lower than the CAA section 211(o)(2)(B)(i)(III) statutory
volumes enumerated by Congress for each year from 2010-2022. EPA was
challenged regarding its interpretation of this statutory provision,
leading the D.C. Circuit to evaluate various aspects of EPA's
implementation of its cellulosic waiver authority.\9\ In 2013 in API,
the court held that EPA must take a ``neutral aim at accuracy'' in
determining the projected volume of cellulosic biofuel available.\10\
In API and Alon Refining Krotz Springs, Inc. v. EPA, the D.C. Circuit
upheld EPA's decision to use the Energy Information Administration's
(EIA's) projected volume of cellulosic biofuel production to inform
EPA's projection, without requiring ``slavish adherence by EPA to the
EIA estimate,'' and had Congress so intended ``it could have skipped
the EPA `determination' altogether.'' \11\ In Sinclair Wyoming Refining
Co. LLC, et al. v. EPA, the D.C. Circuit upheld EPA's reading of the
statutory phrase ``projected volume available'' to exclude carryover
RINs.\12\
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\9\ See, e.g., American Petroleum Institute v. EPA, 706 F.3d
474, 479 (D.C. Cir. 2013) (``API'') (interpreting the ``projected
volume available'' and indicating that ``the most natural reading of
the provision is to call for a projection that aims at accuracy, not
at deliberately indulging a greater risk of overshooting than
undershooting'' in projecting the available cellulosic biofuel
volume); Americans for Clean Energy v. EPA, 864 F.3d 691, 730 (D.C.
Cir. 2017) (``ACE'') (determining EPA's use of the cellulosic waiver
authority to reduce advanced and total renewable fuel was
reasonable); Sinclair Wyoming Refining Co. LLC, et al. v. EPA, 101
F.4th 871, 883 (2024) (``Sinclair'') (rejecting biofuels producers'
challenge that EPA must include carryover cellulosic RINs in its
determination of ``projected volume available during that calendar
year'').
\10\ API, 706 F.3d at 476.
\11\ API, 607 F.3d at 478. See also Alon Refining Krotz Springs,
Inc. v. EPA, 396 F.3d 628, 660 (D.C. Cir. 2019).
\12\ Sinclair, 101 F.4th at 883-86.
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In the proposal, EPA sought comment on whether the cellulosic
waiver authority is available to reduce the cellulosic biofuel volume
in 2024. EPA received comments suggesting that the cellulosic waiver
authority remains available to EPA and that waiving the cellulosic
biofuel volume requirement under this waiver authority would be
appropriate. EPA also received comments suggesting that the cellulosic
waiver authority should not or could not be used in these circumstances
or that the cellulosic waiver authority is not available at all after
2022. We address some of these comments in this preamble and address
others more fully in the RTC document.
Several commenters suggested that cellulosic waiver authority is
not available to EPA to reduce volumes after 2022. These commenters
pointed to CAA section 211(o)(7)(D), which directs EPA to determine if
there is a projected cellulosic biofuel production shortfall based on
an estimate provided by the U.S. Energy Information Administration
(EIA) pursuant to CAA section 211(o)(3)(A). That provision, however,
was in effect only through 2021.\13\ As noted above, EPA has in the
past utilized the EIA estimate in conjunction with other data to arrive
at an estimated projection of cellulosic biofuel production. The EIA
estimate has never included CNG/LNG in its projection of cellulosic
biofuel production, even though over 95 percent of the cellulosic
biofuel volume requirement has been met with CNG/LNG. The D.C. Circuit
has upheld EPA's use of other information to inform our production
estimate, particularly for CNG/LNG production that accounts for the
vast majority of cellulosic biofuel.\14\
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\13\ CAA section 211(o)(3)(A) provides: ``Not later than October
31 of each of calendar years 2005 through 2021, the Administrator of
the Energy Information Administration shall provide to the
Administrator of the Environmental Protection Agency an estimate,
with respect to the following calendar year, of the volumes of
transportation fuel, biomass-based diesel, and cellulosic biofuel
projected to be sold or introduced into commerce in the United
States.''
\14\ See, e.g., ACE, 864 F.3d at 728-30 (upholding EPA's
cellulosic biofuel projection methodology including, among other
things. EPA's reliance on biofuel producers' self-reported
production startup dates, use of production ranges, and a percentile
approach).
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In contrast, other statutory references indicate the continuing
availability of the cellulosic waiver authority to reduce the volumes
EPA sets under CAA section 211(o)(2)(B). First, CAA section
211(o)(7)(D) indicates that EPA is to reduce the cellulosic biofuel
volume ``for any year for which the projected volume of cellulosic
biofuel is less than the applicable volume.'' The ``any year'' language
is expansive and is not limited by any other language in the provision,
indicating that Congress intended for it to be available for all years
of the RFS program. Second, CAA section 211(o)(2)(B)(iv) indicates that
EPA shall determine cellulosic volumes ``under the assumption that the
Administrator will not need to issue a waiver for such years under
paragraph (7)(D).'' While this language primarily provides guidance to
EPA on how to determine volumes under CAA section 211(o)(2)(B)(ii), it
also contemplates the continued existence of the CAA 211(o)(7)(D)
cellulosic waiver authority in the set years. This is also consistent
with the reference in CAA section 211(o)(7)(D) directing EPA to compare
the projected production of cellulosic biofuel to the cellulosic
biofuel volume ``required under paragraph (2)(B).'' This reference to
paragraph (2)(B) encompasses all years of the RFS
[[Page 29754]]
program: the compliance years up to 2022 during which EPA applied the
CAA section 211(o)(2)(B)(i) statutory tables enumerating applicable
volumes, and the years from 2023 forward during which EPA uses its CAA
section 211(o)(2)(B)(ii) set authority to determine or set volumes
applying statutory factors. We conclude that the best reading of the
statute is that, when read together, the various statutory references
in CAA section 211(o) indicate that Congress intended the cellulosic
waiver authority to remain available to EPA for years beyond the
statutory tables (i.e., 2023 and beyond). For all these reasons, EPA
believes this interpretation of CAA section 211(o)(7)(D)--that the
cellulosic waiver authority is available to use in years after 2022--is
the best reading of the statute given the text, structure of the RFS
program, and the context of how EPA implements the RFS program year to
year.\15\ Moreover, such an interpretation is consistent with EPA's
history of implementing the cellulosic waiver authority in years where
cellulosic biofuel production falls short of the minimum required
volume; this is simply the first instance EPA is implementing a partial
cellulosic waiver in the years where EPA establishes volumes utilizing
its set authority.\16\
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\15\ See Loper Bright Enterprises v. Raimondo, 603 U.S. 369, 400
(2024) (``Loper Bright'') (in overruling Chevron deference, the
Court observed that it ``makes no sense to speak of a `permissible'
interpretation [of a statute] that is not the one the court, after
applying all relevant interpretive tools, concludes is best. In the
business of statutory interpretation, if it is not the best, it is
not permissible.'').
\16\ As discussed further in the RTC document, EPA received a
petition from the American Fuel and Petrochemical Manufacturers for
a waiver of the 2023 cellulosic biofuel volume requirement. In
adjudicating that petition, EPA did not address the cellulosic
waiver authority and instead focused on a potential waiver under the
general waiver authority.
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EPA is implementing the cellulosic waiver authority to reduce the
2024 cellulosic biofuel volume after the deadline articulated in the
statute; CAA section 211(o)(7)(D)(i) directs EPA to act ``by November
30 of the preceding calendar year'' to determine whether cellulosic
biofuel production is likely to fall short of the volume requirements
in a given year, and then reduce the standard to the projected volume
available. Several commenters suggested that such untimely use is
improper. We disagree. Notably, EPA has implemented the cellulosic
waiver authority to reduce the cellulosic biofuel volume after the
November 30 deadline on several occasions.\17\ No party has
specifically challenged EPA's use of the cellulosic waiver authority
after the November 30 deadline, but petitioners have unsuccessfully
challenged EPA's late issuance of standards under other RFS provisions.
The D.C. Circuit has concluded that EPA retains the ability to issue
late standards even when it acts after the statutory deadlines have
passed.\18\ We therefore rely on our past practice in implementing the
RFS program and favorable case law to implement the cellulosic waiver
authority to waive the volume requirements for a given year even when
the November 30 deadline in the preceding year has passed, as it has in
this instance.
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\17\ See, e.g., 79 FR 25025 (May 2, 2014) (direct final rule
reducing the 2013 cellulosic biofuel volume in May 2014), 80 FR
77420 (December 14, 2015) (final rule reducing the 2014 and 2015
cellulosic biofuel volumes in December 2015), 87 FR 39600 (July 1,
2022) (final rule reducing the 2020 and 2021 volumes in July 2022).
\18\ See ACE, 864 F.3d at 721. See further discussion on this
topic in RTC Section 2.3.2.
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CAA section 211(o)(7)(D)(i) also refers to the ``projected volume
of cellulosic biofuel production'' and the ``projected volume
available,'' which some commenters suggested is another indication that
the provision should or could only be used prospectively. EPA believes
the best reading of the statute is instead that there are projections
necessary to determine the ``volume of . . . production'' and the
``volume available,'' both when EPA acts in a timely manner by November
30 of the preceding year and when EPA waives the volume requirement
after the November 30 date. The use of the term ``projected'' in the
statute does contemplate the need for forward-looking estimates;
however, it does not follow that the statutory language prohibits EPA
from acting after November 30.\19\
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\19\ See Loper Bright at 400.
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We note that the statutory language indicates that the use of the
cellulosic waiver authority is mandatory. That is, whenever the
projected volume of cellulosic biofuel production is less than the
minimum applicable volume established under CAA section (o)(2)(B), EPA
``shall reduce the applicable volume of cellulosic biofuel required
under paragraph (2)(B) to the projected volume available during that
calendar year.'' \20\ EPA implemented this provision for every year
from 2010-2022 to reduce the cellulosic biofuel volume consistent with
the statutory directive that EPA shall reduce the volume when the
requisite conditions are met.\21\
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\20\ CAA section 211(o)(7)(D)(i).
\21\ EPA acknowledges that it did not waive the 2023 cellulosic
biofuel volume requirement. See https://www.epa.gov/renewable-fuel-standard-program/epa-denial-petition-partial-waiver-2023-cellulosic-biofuel.
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CAA section 211(o)(7)(D)(ii) directs EPA to make CWCs available
whenever it reduces the cellulosic biofuel volume under CAA section
211(o)(7)(D). CWCs--which are offered for sale to obligated parties at
a price established by regulation per the statute \22\--provide
compliance flexibility for obligated parties. However, it should be
noted that CWCs only satisfy an obligated party's cellulosic biofuel
obligation; unlike a cellulosic RIN, a CWC cannot be used to satisfy an
obligated party's advanced biofuel or total renewable fuel
obligation.\23\ To obtain the same compliance value as a cellulosic
RIN, an obligated party using a CWC for compliance with the cellulosic
biofuel standard needs to also acquire an advanced or BBD RIN to use
towards meeting its advanced biofuel and total renewable fuel
obligations. When CWCs are made available, they generally limit or cap
the price of cellulosic RINs.\24\
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\22\ CAA section 211(o)(7)(D)(iii); 40 CFR 80.1456.
\23\ 72 FR 14726-27 (March 26, 2010).
\24\ See, e.g., 85 FR 7025 (February 6, 2020); 87 FR 39616 (July
1, 2022).
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CAA section 211(o)(7)(D) provides that EPA may reduce the
applicable volume of total renewable fuel and advanced biofuel in years
when EPA reduces the applicable volume of cellulosic biofuel under that
provision. That reduction must be less than or equal to the reduction
in cellulosic biofuel. The D.C. Circuit explained:
There is no requirement to reduce these latter quotas, nor does
the statute prescribe any factors that EPA must consider in making
its decision. . . . In the absence of any express or implied
statutory directive to consider particular factors, EPA reasonably
concluded that it enjoys broad discretion regarding whether and in
what circumstances to reduce the advanced biofuel and total
renewable fuel volumes under the cellulosic waiver provision.\25\
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\25\ Monroe v. EPA, 750 F.3d 909, 915 (2014). See, also, ACE at
721.
Using this discretion, EPA has, in the past, declined to reduce the
advanced biofuel and total renewable fuel volumes in certain
circumstances.\26\ In other circumstances, EPA has reduced the advanced
biofuel and total renewable fuel volumes using this authority.\27\ It
is worth noting that EPA's practice of reducing the advanced biofuel
and total renewable fuel volumes utilizing the cellulosic waiver
authority in past years served to carry through the partial waiver
necessitated by the shortfall in cellulosic biofuel to
[[Page 29755]]
the other nested renewable fuel categories when reducing the statutory
cellulosic biofuel volumes established by Congress in 2007. In many
cases reductions to the advanced biofuel and total renewable fuel
volumes were necessary to enable compliance by obligated parties. For
example, EPA reduced the cellulosic biofuel volume by over 15 billion
gallons for 2022. Had EPA not also reduced the 2022 advanced biofuel
and total renewable fuel volumes, these requirements would have been 15
billion gallons higher, far exceeding the market's ability to supply
qualifying renewable fuels, even after considering available carryover
RINs. In contrast, for 2024, a year for which EPA set the volume
requirements using our set authority, the partial waiver of the
cellulosic biofuel volume requirement is significantly smaller than in
prior years (0.08 billion gallons), in part due to the fact that
instead of starting with a statutory table volume set by Congress many
years ago, EPA itself established the volume requirements in 2023 under
the set authority. As discussed further in Section III.A, we are not
adjusting the 2024 total renewable fuel and advanced biofuel volumes
because those volumes have been achieved in the market.
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\26\ See, e.g., 78 FR 49794, 49811 (August 15, 2013).
\27\ See, e.g., 80 FR 77420 (December 14, 2015). 81 FR 89746
(December 12, 2016).
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III. Partial Waiver of the 2024 Cellulosic Biofuel Volume Requirement
A. Implementation of the Cellulosic Waiver Authority
The cellulosic waiver authority is specific regarding when it is
available and how the volume reduction should be determined when acting
under the authority, as discussed in Section II. EPA has determined
that ``the projected volume of cellulosic biofuel production is less
than the minimum applicable volume'' for 2024 and thus use of the
cellulosic waiver authority is mandatory to reduce the 2024 cellulosic
biofuel volume. In the Set 1 Rule, EPA established the ``minimum
applicable volume'' of cellulosic biofuel for 2024 to be 1.09 billion
RINs and used that volume to calculate the 2024 cellulosic biofuel
percentage standard of 0.63 percent.\28\ The actual number of
cellulosic RINs that obligated parties will ultimately need to retire
for compliance with the current standard will not be known until after
the 2024 compliance deadline,\29\ when obligated parties report to EPA
their 2024 gasoline and diesel production and import volumes.\30\
However, for the purpose of making a decision to partially waive the
2024 cellulosic biofuel volume requirement, we have assumed that the
actual total 2024 cellulosic biofuel obligation, if not reduced, would
be 1.09 billion RINs.\31\ Based on RIN generation data for 2024, we
project that only 1.01 billion cellulosic RINs were generated in 2024,
representing the projected volume of cellulosic biofuel available in
2024.\32\ This is 0.08 billion fewer RINs than the 1.09 billion RINs
needed to comply with the original 2024 cellulosic biofuel standard, a
shortfall of approximately seven percent. We therefore find that the
circumstances have triggered the need for implementation of the
cellulosic waiver authority for 2024.
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\28\ 88 FR 44470-71 (July 12, 2023).
\29\ The compliance deadline for the 2024 standards will be the
first quarterly reporting deadline after the effective date of this
action revising the 2024 cellulosic biofuel standard. 40 CFR
80.1451(f)(1)(i)(B)(5).
\30\ 40 CFR 80.1451 and 80.1427(a).
\31\ Because the compliance obligation is calculated on a
percentage basis, if the actual gasoline and diesel volumes reported
by obligated parties differ from the projected gasoline and diesel
volumes that were used to derive the percentage standard, then the
actual number of RINs required for compliance will differ from the
projected volume that was used to calculate the percentage standard.
Although we rely on the 1.09-billion-RIN projection for 2024 in the
Set 1 Rule that was the basis for the 2024 cellulosic biofuel
percentage standard, EPA would reach the same conclusion to waive
the 2024 cellulosic biofuel volume requirement, for the reasons
stated below, using a higher RIN obligation (i.e., a higher gasoline
and diesel projection).
\32\ See ``Total Net Generation'' RIN data table at: https://www.epa.gov/fuels-registration-reporting-and-compliance-help/rins-generated-transactions. This table includes all reported cellulosic
RINs that were generated in 2024 and were not otherwise retired due
to RIN generation error (i.e., an invalid RIN). Thus, the volume of
2024 cellulosic RINs in this table is the volume of RINs that have
been made available for compliance with the 2024 cellulosic biofuel
standard.
---------------------------------------------------------------------------
When EPA determines that a waiver of the cellulosic biofuel volume
requirement is appropriate under CAA section 211(o)(7)(D)(i), EPA must
then reduce the required cellulosic biofuel volume to ``the projected
volume available.'' We have previously interpreted the phrase
``projected volume available'' to exclude carryover RINs when
determining the volume adjustment to be made; this interpretation was
affirmed by the D.C. Circuit in Sinclair.\33\ EPA has consistently
interpreted the ``projected volume available'' as ``the volume of
qualifying cellulosic biofuel projected to be produced or imported and
available for use as transportation fuel in the U.S. in that year.''
\34\ In determining the ``projected volume available,'' EPA must take a
``neutral aim at accuracy.'' \35\
---------------------------------------------------------------------------
\33\ Sinclair, 101 F.4th at 883-86.
\34\ See, e.g., 87 FR 39600 (July 1, 2022). See also Sinclair,
101 F.4th at 883-86.
\35\ API v. EPA, 706 F.3d 474, 479 (D.C. Cir. 2013).
---------------------------------------------------------------------------
As discussed above, the projected volume of cellulosic biofuel
available in 2024 was 1.01 billion RINs. Thus, when the cellulosic
waiver authority is applied, EPA is only able to reduce the 2024
cellulosic biofuel volume to the projected volume available of 1.01
billion RINs. However, in accordance with the statute, EPA is also
required to make CWCs available to obligated parties, which can be
used--along with additional BBD or advanced RINs--to cover any
remaining shortfall.\36\ The availability of CWCs helps ensure RFS
program stability by reducing the likelihood that obligated parties may
be forced into non-compliance with their RFS obligations; any obligated
party that is unable to acquire sufficient cellulosic RINs to comply
with their 2024 cellulosic biofuel obligations--plus any cellulosic RIN
deficit carried from 2023 \37\--will be able to purchase CWCs to cover
the shortfall.\38\
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\36\ Pursuant to 40 CFR 80.1405(d), the CWC price is calculated
using the methodology specified in 40 CFR 80.1456(d) and posted on
EPA's website at: https://www.epa.gov/renewable-fuel-standard-program/cellulosic-waiver-credits-under-renewable-fuel-standard-program.
\37\ As noted in the proposal, we are aware of RIN deficits from
the 2023 compliance year that will need to be fulfilled by the 2024
compliance deadline. 89 FR 100442, 100445-46 (December 12, 2024).
This topic is discussed further in the RTC document.
\38\ Unlike cellulosic RINs--which apply towards an obligated
party's cellulosic biofuel, advanced biofuel, and total renewable
fuel obligations--CWCs only apply towards an obligated party's
cellulosic biofuel obligation and not toward their nested advanced
biofuel and total renewable fuel obligation. Obligated parties that
satisfy their cellulosic biofuel obligations with CWCs would
therefore also have to purchase additional BBD or advanced RINs to
meet their associated advanced biofuel and total renewable fuel
obligations.
---------------------------------------------------------------------------
Given that ``the projected volume of cellulosic biofuel production
is less than the minimum applicable volume'' for 2024, we are
implementing the cellulosic waiver authority to waive the 2024
cellulosic biofuel volume requirement to 1.01 billion RINs, a reduction
of 0.08 billion RINs from the original volume requirement of 1.09
billion RINs. This volume requirement matches the actual cellulosic RIN
generation for 2024 of 1.01 billion RINs.
Finally, CAA section 211(o)(7)(D) provides that EPA may reduce the
applicable volume of total renewable fuel and advanced biofuel in years
when EPA reduces the applicable volume of cellulosic biofuel under that
provision. That reduction must be less than or equal to the reduction
in cellulosic biofuel. The D.C. Circuit concluded that the cellulosic
waiver authority provides EPA ``broad discretion'' to consider a
variety of factors in determining whether to reduce the total renewable
fuel and advanced biofuel volumes
[[Page 29756]]
under this provision.\39\ Advanced and total RIN generation for 2024
exceeded the required volumes by over 3.8 billion RINs (10.42 billion
advanced RINs generated vs. 6.54 billion RIN advanced biofuel volume
requirement) and 3.7 billion RINs (25.30 billion total RINs generated
vs. 21.54 billion total renewable fuel volume requirement),
respectively, notwithstanding the projected shortfall in cellulosic
biofuel production.\40\ Thus, we believe reductions to the 2024
advanced biofuel and total renewable fuel volumes are not necessary or
warranted based on the available supply data, given that the market has
provided volumes of these fuels in excess of the requirements
established in the Set 1 Rule. Reductions in these volume requirements
at this time would only serve to increase the number of advanced and
total carryover RINs. Historically, we have declined to take actions
that would inflate the number of available carryover RINs.\41\
---------------------------------------------------------------------------
\39\ ACE at 730-734. See also Monroe Energy, LLC v. EPA, 750
F.3d 909 (D.C. Cir. 2014).
\40\ See ``Total Net Generation'' RIN data table at: https://www.epa.gov/fuels-registration-reporting-and-compliance-help/rins-generated-transactions. This table includes all reported RINs that
were generated in 2024 and were not otherwise retired due to RIN
generation error (i.e., an invalid RIN). Thus, the volume of 2024
RINs in this table is the volume of RINs that have been made
available for compliance with the 2024 RFS standards.
\41\ 87 FR 39600, 39621 (July 1, 2022) (``While EPA has
previously set the RFS standards at what the market actually used
(like for 2014 and 2015 in the 2014-2016 rule), we have never
intentionally reduced the standards with the express intent to
inflate the size of the carryover RIN bank.''); ``Renewable Fuel
Standard (RFS) Program: RFS Annual Rules--Response to Comments,''
EPA-420-R-22-009, June 2022, Section 2.6.1.
---------------------------------------------------------------------------
B. Economic Impact Analysis
This section discusses our analysis of the anticipated economic
impact of the partial waiver of the 2024 cellulosic biofuel volume
requirement. Consistent with the goals of Executive Orders 12866 and
14192, this analysis is intended to provide transparency regarding the
costs and benefits of this economically significant deregulatory
action. Because we are reducing the 2024 cellulosic biofuel volume,
this action is expected to result in significant costs savings.
However, quantitatively projecting the economic impact of this
reduction is challenging for several reasons. First, the partial waiver
is due to a shortfall in the volume of cellulosic biofuel in 2024.
Because of this, higher volumes of cellulosic RINs cannot simply be
made available at greater prices; instead, obligated parties will be
unable to purchase additional quantities of 2024 cellulosic RINs at any
price. The potential economic impact of this action is further
complicated by the fact that while some obligated parties can defer
some or all of their 2024 cellulosic biofuel obligation to 2025, other
obligated parties that already carried cellulosic RIN deficits from
2023 into 2024 are required to fully satisfy their cellulosic biofuel
obligations in 2024, including the cellulosic RIN deficits carried
forward from 2023. Any party that fails to do so would likely be in
non-compliance and could be subject to penalties.\42\
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\42\ We recognize that the cellulosic waiver authority is
mandatory, and thus avoids the potential noncompliance and lack of
RINs described herein. Nevertheless, we describe these potential
outcomes to illustrate the difficulty in calculating the cost
savings of the action.
---------------------------------------------------------------------------
Despite the complications associated with estimating the economic
impacts of this action, we can determine that it will result in cost
savings. Because we are unable to estimate the cost of production of
cellulosic biofuel that was not produced, we are estimating the cost
savings of this action using RIN prices to approximate the cost of the
marginal gallon of cellulosic biofuel relative to the petroleum fuel
the marginal gallon displaces.\43\ We are reducing only the 2024
cellulosic biofuel volume. Because we are not reducing the 2024
advanced biofuel and total renewable fuel volumes, this action
effectively replaces the reduced cellulosic biofuel volume with
additional volumes of advanced biofuel, which generally has a lower
marginal cost than cellulosic biofuel.\44\ In 2024, the average price
for a cellulosic (D3/D7) RIN was $3.11 and the average price for a D4/
D5 RIN was $0.78.\45\ The price difference between a D3/D7 RIN and a
D4/D5 RIN was $2.34. Multiplying this price difference by the magnitude
of the reduction in the cellulosic biofuel volume requirement (80
million RINs), we estimate a cost savings of $187 million from this
action.
---------------------------------------------------------------------------
\43\ We are using these RIN prices to approximate the societal
cost for these fuels. Our analyses indicate that, on average across
the U.S., RIN costs are recovered by obligated parties and passed
through to consumers. For a further discussion of the ability of
obligated parties to recover the cost of RINs see ``Denial of
Petitions for Rulemaking to Change the RFS Point of Obligation,''
EPA-420-R-17-008, November 2017.
\44\ The nested nature of the RFS program allows cellulosic
biofuel to be used to meet the advanced biofuel and total renewable
fuel volume requirements. Any cellulosic biofuel that can be
supplied beyond the required volume can be used in place of advanced
biofuel.
\45\ Prices based on EMTS data. RIN prices are the average of
all trades of vintage 2023 and 2024 separated RINs in calendar year
2024.
---------------------------------------------------------------------------
Finally, we can reasonably project that because this action will
reduce demand for cellulosic RINs, it is expected to directionally
decrease cellulosic RIN prices. The exact magnitude of this price
reduction depends on a wide range of market factors that prevent us
from quantitively projecting a RIN price impact. At the same time,
because this action incrementally increases demand for advanced RINs,
it is projected to directionally increase BBD and advanced RIN prices.
We note, however, that this price impact is expected to be relatively
small, as this action will increase demand for advanced biofuel by the
magnitude of the partial waiver of the 2024 cellulosic biofuel volume
requirement (0.08 billion RINs). This is less than one percent of the
supply of advanced biofuel for 2024 (10.41 billion RINs).
C. Calculation of 2024 Cellulosic Biofuel Percentage Standard
The obligated parties to which the percentage standards apply are
producers and importers of gasoline and diesel, as defined by 40 CFR
80.2. Each obligated party multiplies the percentage standards by the
sum of all non-renewable gasoline and diesel they produce or import to
determine their Renewable Volume Obligations (RVOs).\46\ The RVOs are
the number of RINs that the obligated party is responsible for
procuring and retiring to demonstrate compliance with the applicable
standards for that year. As described in Section III.A, we are
implementing the cellulosic waiver authority to partially waive the
2024 cellulosic biofuel volume requirement from 1.09 billion RINs to
1.01 billion RINs.
---------------------------------------------------------------------------
\46\ 40 CFR 80.1407.
---------------------------------------------------------------------------
[[Page 29757]]
The formula used to calculate the cellulosic biofuel percentage
standard applicable to obligated parties as a function of their
gasoline and diesel fuel production or importation is provided in 40
CFR 80.1405(c). Using the same values from the Set 1 Rule for the
variables in this formula other than RFVCB (the cellulosic
biofuel volume),\47\ we have calculated the revised cellulosic biofuel
percentage standard for 2024 to be 0.59 percent, down from 0.63
percent.\48\ This percentage standard is included in the regulations at
40 CFR 80.1405(a) and applies to producers and importers of gasoline
and diesel.
---------------------------------------------------------------------------
\47\ 88 FR 44519-21 (July 12, 2023).
\48\ See ``Calculation of 2024 Cellulosic Biofuel Percentage
Standard,'' available in the docket for this action.
---------------------------------------------------------------------------
IV. Change to Calculation of Cellulosic Waiver Credit Price
As discussed in Section II.B, for any year for which EPA uses the
cellulosic waiver authority to reduce the required volume of cellulosic
biofuel, EPA must provide obligated parties the opportunity to purchase
CWCs. The price of these credits is determined using a formula
specified in CAA section 211(o)(7)(D)(ii), which is ``at the higher of
$0.25 per gallon or the amount by which $3.00 per gallon exceeds the
average wholesale price of a gallon of gasoline in the United States,''
adjusted for inflation. The RFS regulations previously specified that
the ``U.S. Total Gasoline Bulk Sales (Price) by Refiners as provided by
the Energy Information Administration'' is to be used to determine the
average wholesale price of gasoline and the inflation adjustment.\49\
However, this data source is no longer being issued by EIA and has not
been updated since March 2022.
---------------------------------------------------------------------------
\49\ 40 CFR 80.1456(d)(2).
---------------------------------------------------------------------------
We are therefore revising our regulations to point to a new data
source for the average wholesale price of gasoline to be used in the
calculation of the CWC price. The only wholesale gasoline prices
currently reported by EIA are spot prices for New York Harbor
(conventional gasoline), U.S. Gulf Coast (conventional gasoline), and
Los Angeles (RBOB regular gasoline).\50\ We proposed to revise the
regulations to calculate the average wholesale gasoline price using a
weighted average of EIA's reported spot prices for wholesale gasoline
using the weighting factors specified in Table IV-1. Commenters were
generally supportive of the proposed changes and therefore we are
finalizing these new data sources and weighting factors as proposed.
---------------------------------------------------------------------------
\50\ This data is publicly available at: EIA, ``Spot Prices,''
Petroleum & Other Liquids. https://www.eia.gov/dnav/pet/pet_pri_spt_s1_m.htm.
Table IV-1--Weighting Factors for Calculating the Average Wholesale
Gasoline Price
------------------------------------------------------------------------
Weighting factor \a\
EIA spot price (%)
------------------------------------------------------------------------
New York Harbor (conventional gasoline)........... 37.5
U.S. Gulf Coast (conventional gasoline)........... 37.5
Los Angeles (RBOB regular gasoline)............... 25.0
------------------------------------------------------------------------
\a\ Weighting factors based on approximate amounts of conventional
gasoline (CG) and reformulated gasoline (RFG) sold in the United
States, with an equal weighting factor for the New York Harbor and
U.S. Gulf Coast CG prices. EPA currently estimates that approximately
25 percent of gasoline sold in the United States is RFG (https://www.epa.gov/gasoline-standards/reformulated-gasoline).
Consistent with the approach used for the previous EIA data source,
we are specifying that the CWC price is calculated using average
monthly gasoline spot price data from the 12-month period ending June
of the year prior to the relevant year (e.g., July 2022 to June 2023
for the 2024 CWC price). Since we are using the cellulosic waiver
authority to partially waive the 2024 cellulosic biofuel volume
requirement in this action, CWCs will be made available to obligated
parties to purchase for the 2024 compliance year. Using the new data
sources and weighting factors in Table IV-1 results in a 2024 CWC price
of $1.61.\51\
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\51\ EPA, ``2024 Cellulosic Waiver Credit Price Calculation,''
EPA 420-B-25-017, June 2025.
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V. Measurement of Renewable CNG/LNG Using Documentation
We are also amending 40 CFR 80.155(a) to clarify that renewable
natural gas (RNG) RIN separators may obtain the measurement of
renewable CNG/LNG through documentation. Under 40 CFR 80.155(a),
measurements of renewable CNG/LNG must be made using specified in-line
GC meters and flow meters, or with an EPA-accepted alternative
measurement protocol. We proposed and are now finalizing an additional
option to allow RNG RIN separators to use documentation that
establishes the volumes of natural gas or renewable CNG/LNG dispensed
to satisfy the continuous measurement requirement. Because these
statements are typically based on readings from meters that generally
comport with the already specified meter standards, EPA has concluded
this is an appropriate approach for RNG RIN separators to determine the
amount of renewable CNG/LNG used as transportation fuel.
Commenters were generally supportive of this proposed change. In
the proposal, we provided the example of a pipeline or utility
statement as acceptable documentation for purposes of establishing the
volume of natural gas or renewable CNG/LNG. Several commenters
suggested that EPA add language to clarify that weigh tickets and bills
of lading are also acceptable documentation for renewable LNG, as well
as specify default conversion factors for documentation that is not
provided in Btu. We agree with the commenters and have added weigh
tickets and bills of lading as further examples to the final
regulations, as well as default conversion factors in 40 CFR 80.155(f).
EPA continues to evaluate the other proposed updates and
clarifications to the RFS biogas regulations, including other proposed
revisions to 40 CFR 80.155(a), and may finalize them in a later action.
VI. Severability
We intend for the regulations promulgated in this action to
implement the cellulosic waiver credit price calculation and
measurement of renewable CNG/LNG to be severable from our action to
implement the cellulosic waiver authority to reduce the 2024 cellulosic
biofuel volume. These actions are distinct and independent, with
separate justifications. Therefore, if a court were to invalidate the
use of the cellulosic waiver authority, we would intend for the
regulatory changes to remain in place.
VII. Judicial Review
Section 307(b)(1) of the CAA governs judicial review of final
actions by the EPA. This section provides, in part, that
[[Page 29758]]
petitions for review must be filed in the United States Court of
Appeals for the District of Columbia Circuit: (i) when the agency
action consists of specifically enumerated actions or ``any other
nationally applicable regulations promulgated, or final action taken,
by the Administrator,'' or (ii) when such action is locally or
regionally applicable, but ``such action is based on a determination of
nationwide scope or effect and if in taking such action the
Administrator finds and publishes that such action is based on such a
determination.'' For locally or regionally applicable final actions
that are based on a determination of nationwide scope or effect, the
CAA reserves to the EPA complete discretion to decide whether to invoke
the exception in (ii).\52\
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\52\ Sierra Club v. EPA, 47 F.4th 738, 745 (D.C. Cir. 2022)
(``EPA's decision whether to make and publish a finding of
nationwide scope or effect is committed to the agency's discretion
and thus is unreviewable''); Texas v. EPA, 983 F.3d 826, 83435 (5th
Cir. 2020).
---------------------------------------------------------------------------
This final action modifies requirements under section 211(o) of the
Clean Air Act, 42 U.S.C. 7545(o). Because this final action promulgates
a revised standard and regulatory amendments under the CAA, it is
``nationally applicable'' under CAA section 307(b)(1) either as one of
the specifically enumerated actions (``any control or prohibition under
section 7545 of this title'') or as a ``nationally applicable
regulation[ ] promulgated . . . by the Administrator.'' Under section
307(b)(1) of the CAA, petitions for judicial review of this action must
be filed in the United States Court of Appeals for the District of
Columbia Circuit by September 5, 2025. Filing a petition for
reconsideration by the Administrator of this final action under CAA
section 307(d)(7)(B) does not affect the finality of the action for
purposes of judicial review, nor does it extend the time within which a
petition for judicial review must be filed, and shall not postpone the
effectiveness of the action.
VIII. Statutory and Executive Order Reviews
Additional information about these statutes and Executive orders
can be found at https://www.epa.gov/laws-regulations/laws-and-executive-orders.
A. Executive Order 12866: Regulatory Planning and Review
This is an economically significant regulatory action because it
meets the criteria in section 3(f)(1) of Executive Order 12866.
Accordingly, EPA submitted this action to the Office of Management and
Budget (OMB) for Executive Order 12866 review. Documentation of any
changes made in response to the Executive Order 12866 review is
available in the docket. EPA prepared an analysis of the potential
economic impacts associated with this action, available in Section
III.B.
B. Executive Order 14192: Unleashing Prosperity Through Deregulation
This action is considered an Executive Order 14192 deregulatory
action. Details on the estimated cost savings of this final rule can be
found in EPA's analysis of the economic impact associated with this
action in Section III.B.
C. Paperwork Reduction Act (PRA)
This action does not impose an information collection burden under
the PRA. OMB has previously approved the information collection
activities related to this final rule and has assigned the following
OMB control numbers 2060-0725, 2060-0740, and 2060-0749. This action
reduces the required cellulosic biofuel volume for 2024 and does not
impose new or different reporting requirements on regulated parties
than already exist for the RFS program.
D. Regulatory Flexibility Act (RFA)
I certify that this action will not have a significant economic
impact on a substantial number of small entities under the RFA. In
making this determination, EPA concludes that the impact of concern for
this rule is any significant adverse economic impact on small entities
and that the agency is certifying that this rule will not have a
significant economic impact on a substantial number of small entities
because the rule relieves regulatory burden on the small entities
subject to the rule.
The small entities directly regulated by the RFS program are small
refiners, which are defined at 13 CFR 121.201. EPA believes that there
are currently 6 refiners (owning 7 refineries) producing gasoline and/
or diesel that meet the definition of small entity by having 1,500
employees or fewer. This action decreases burden via a reduction in the
2024 cellulosic biofuel standard, which applies proportionally to all
obligated parties, including small refiners. We have therefore
concluded that this action will relieve regulatory burden for all
directly regulated small entities.
E. Unfunded Mandates Reform Act (UMRA)
This action does not contain an unfunded mandate of $100 million
(adjusted annually for inflation) or more (in 1995 dollars) as
described in UMRA, 2 U.S.C. 1531-1538, and does not significantly or
uniquely affect small governments. The action implements a mandate
specifically and explicitly set forth in CAA section 211(o)(7)(D)
without the exercise of any policy discretion by EPA.
F. 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.
G. Executive Order 13175: Consultation and Coordination With Indian
Tribal Governments
This action does not have Tribal implications as specified in
Executive Order 13175. This action will be implemented at the Federal
level and affects transportation fuel refiners, blenders, marketers,
distributors, importers, exporters, and renewable fuel producers and
importers. Tribal governments would be affected only to the extent they
produce, purchase, and use regulated fuels. Thus, Executive Order 13175
does not apply to this action.
H. Executive Order 13045: Protection of Children From Environmental
Health Risks and Safety Risks
EPA interprets Executive Order 13045 as applying only to those
regulatory actions that concern environmental health or safety risks
that EPA has reason to believe may disproportionately affect children,
per the definition of ``covered regulatory action'' in section 2-202 of
the Executive order. Therefore, this action is not subject to Executive
Order 13045 because it reduces the 2024 cellulosic biofuel volume and
does not concern an environmental health risk or safety risk. Since
this action does not concern human health, EPA's Policy on Children's
Health also does not apply.
I. Executive Order 13211: Actions Concerning Regulations That
Significantly Affect Energy Supply, Distribution, or Use
This action is not a ``significant energy action'' because it is
not likely to have a significant adverse effect on the supply,
distribution, or use of energy. This action reduces the required
cellulosic biofuel volume for 2024 consistent with the volume of such
fuel actually made available in 2024. Therefore, it is not expected to
have any impact on the supply, distribution, or use of energy. In
general, the RFS
[[Page 29759]]
program is designed to achieve positive effects on the Nation's
transportation fuel supply by increasing energy independence and
security.
J. National Technology Transfer and Advancement Act (NTTAA) and 1 CFR
Part 51
This action does not involve technical standards.
ASTM D3588 is referenced in the amendatory text of this document
and has already been approved for Sec. 80.155. There are no changes to
the IBR material.
K. Congressional Review Act (CRA)
This action is subject to the CRA, and the EPA will submit a rule
report to each House of the Congress and to the Comptroller General of
the United States. This action is not a ``major rule'' as defined by 5
U.S.C. 804(2).
IX. Statutory Authority
Statutory authority for this action comes from sections 114, 203-
05, 208, 211, and 301 of the Clean Air Act, 42 U.S.C. 7414, 7522-24,
7542, 7545, and 7601.
List of Subjects in 40 CFR Part 80
Environmental protection, Administrative practice and procedure,
Air pollution control, Diesel fuel, Fuel additives, Gasoline, Imports,
Incorporation by reference, Oil imports, Petroleum, Renewable fuel.
Lee Zeldin,
Administrator.
For the reasons set forth in the preamble, EPA amends 40 CFR part
80 as follows:
PART 80--REGULATION OF FUELS AND FUEL ADDITIVES
0
1. The authority citation for part 80 continues to read as follows:
Authority: 42 U.S.C. 7414, 7521, 7542, 7545, and 7601(a).
Subpart E--Biogas-Derived Renewable Fuel
0
2. Amend Sec. 80.155 by:
0
a. Revising paragraph (a) introductory text;
0
b. Adding paragraphs (a)(4) and (5); and
0
c. Revising paragraph (f).
The revisions and addition read as follows:
Sec. 80.155 Sampling, testing, and measurement.
(a) Biogas and RNG continuous measurement. Except as specified in
paragraph (a)(5) of this section, any party required to measure the
volume of biogas, RNG, or renewable CNG/LNG under this subpart must
continuously measure using meters that comply with the requirements in
paragraphs (a)(1) and (2) of this section, or have an accepted
alternative measurement protocol as specified in paragraph (a)(3) of
this section:
* * * * *
(4) [Reserved]
(5) An RNG RIN separator must measure natural gas or renewable CNG/
LNG using one of the following:
(i) A method specified in paragraphs (a)(1) through (3) of this
section.
(ii) Documentation (e.g., pipeline or utility statements, scale
tickets, or bills of lading) that establishes the volume of natural gas
or renewable CNG/LNG. Documentation must be specified in Btu LHV or
converted as specified in paragraph (f) of this section.
* * * * *
(f) Unit conversions. (1) A party converting between Btu HHV and
Btu LHV for biogas, treated biogas, natural gas, or CNG/LNG must use
the ratio of HHV and LHV of methane as specified in ASTM D3588
(incorporated by reference, see Sec. 80.12).
(2) A party with documentation under paragraph (a)(5) of this
section that is not specified in Btu must convert to Btu LHV as
follows:
(i) A party converting between scf and Btu LHV for CNG must use 934
Btu LHV/scf.
(ii) A party converting between pounds and Btu LHV for LNG must use
21,240 Btu LHV/lb.
* * * * *
Subpart M--Renewable Fuel Standard
0
3. Amend Sec. 80.1405 by revising entry ``2024'' in table 1 to
paragraph (a) to read as follows:
Sec. 80.1405 What are the Renewable Fuel Standards?
(a) * * *
Table 1 to Paragraph (a)--Annual Renewable Fuel Standards
----------------------------------------------------------------------------------------------------------------
Advanced
Cellulosic Biomass- based biofuel Renewable fuel Supplemental total
Year biofuel diesel standard standard standard (%) renewable fuel
standard (%) (%) (%) standard (%)
----------------------------------------------------------------------------------------------------------------
* * * * * * *
2024.......................... 0.59 2.82 3.79 12.50 n/a
* * * * * * *
----------------------------------------------------------------------------------------------------------------
* * * * *
0
4. Amend Sec. 80.1456 by revising paragraph (d)(2) to read as follows:
Sec. 80.1456 What are the provisions for cellulosic biofuel waiver
credits?
* * * * *
(d) * * *
(2) The wholesale price of gasoline is calculated by applying the
weighting factors specified in table 1 to this paragraph (d)(2) to the
average monthly gasoline spot price values specified in table 1 for the
twelve-month period ending June of the year preceding the compliance
period.
Table 1 to Paragraph (d)(2)--Wholesale Price of Gasoline Weighting
Factors
------------------------------------------------------------------------
Weighting
Gasoline spot price data source \1\ factor (%)
------------------------------------------------------------------------
Conventional Gasoline--New York Harbor, Regular............. 37.5
Conventional Gasoline--U.S. Gulf Coast, Regular............. 37.5
[[Page 29760]]
RBOB Regular Gasoline--Los Angeles.......................... 25.0
------------------------------------------------------------------------
\1\ Reported by the Energy Information Administration.
* * * * *
[FR Doc. 2025-11153 Filed 7-3-25; 8:45 am]
BILLING CODE 6560-50-P