[Federal Register: November 27, 2007 (Volume 72, Number 227)]
[Notices]
[Page 66171-66173]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr27no07-83]
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ENVIRONMENTAL PROTECTION AGENCY
[EPA-HQ-OAR-2006-0340; FRL-8499-5]
Renewable Fuel Standard Under Section 211(o) of the Clean Air Act
as Amended by the Energy Policy Act of 2005
AGENCY: Environmental Protection Agency (EPA).
ACTION: Notice.
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SUMMARY: Section 211(o) of the Clean Air Act (the Act), as amended by
the Energy Policy Act of 2005, requires the Administrator of the
Environmental Protection Agency (EPA) to annually determine a renewable
fuel standard (RFS) which is applicable to refiners, importers and
certain blenders of gasoline, and publish the standard in the Federal
Register by November 30 of each year. On the basis of this standard,
each obligated party determines the volume of renewable fuel that it
must ensure is consumed as motor vehicle fuel. This standard is
calculated as a percentage, by dividing the amount of renewable fuel
that the Act requires to be blended into gasoline for a given year by
the amount of gasoline expected to be used during that year, including
certain adjustments specified by the Act. In this notice we are
publishing an RFS of 4.66% for 2008.
FOR FURTHER INFORMATION CONTACT: Chris McKenna, Environmental
Protection Agency, MC 6406J, 1200 Pennsylvania Ave., NW., Washington,
DC 20460; telephone number: 202-343-9037; fax number: 202-343-2801; e-
mail address: mckenna.chris@epa.gov.
SUPPLEMENTARY INFORMATION:
I. Calculation of the 2008 RFS
A. Background
The preamble to the final rulemaking for the Renewable Fuel
Standard Program included a projected RFS for 2008 of 4.63%. 72 FR
23912 (May 1, 2007). In today's notice we are again using the
calculational procedure from the final rulemaking to calculate the 2008
RFS. However, since some projections and assumptions used in the final
rulemaking to calculate the projected 2008 RFS have changed, today's
notice includes a recalculated and final 2008 RFS using the most
recently available information. Since the RFS rule established clear
legal criteria for deriving the standard (including specification of
the formula used in today's notice, and all data sources), EPA is
simply applying facts to pre-established law in issuing the final 2008
RFS standard. EPA is advising the
[[Page 66172]]
regulated community of the revised standard through a Federal Register
Notice, without prior notice and comment, in accordance with the Clean
Air Act and EPA regulations.
The 2008 RFS is calculated by dividing the volume of renewable
fuels required by the Act to be blended into gasoline in 2008, by the
volume of gasoline projected by the Energy Information Administration
(EIA) to be consumed in 2008 (including certain adjustments specified
by the Act). The following equation from the final RFS Program
regulations summarizes all of the variables that must be considered in
the calculation.
[GRAPHIC] [TIFF OMITTED] TN27NO07.004
Where:
RFStdi = Renewable Fuel Standard in year i, in percent
RFVi = Annual volume of renewable fuels required by
section 211(o)(2)(B) of the Act for year i, in gallons
Gi = Amount of gasoline projected to be used in the 48
contiguous states, in year i, in gallons
Ri = Amount of renewable fuel blended into gasoline that
is projected to be consumed in the 48 contiguous states, in year i,
in gallons
GSi = Amount of gasoline projected to be used in Alaska,
Hawaii, or a U.S. territory in year i if the state or territory
opts-in, in gallons
RSi = Amount of renewable fuel blended into gasoline that
is projected to be consumed in Alaska, Hawaii, or a U.S. territory
in year i if the state or territory opts-in, in gallons
GEi = Amount of gasoline projected to be produced by
exempt small refineries and small refiners in year i, in gallons
(through 2010 only unless exemption extended under Sec. Sec.
211(o)(9)(A)(ii) or (B)).
Celli = Beginning in 2013, the amount of renewable fuel
that is required to come from cellulosic sources, in year i, in
gallons (250,000,000 gallons minimum)
B. Data Sources for 2008 RFS Calculation
The following discussion describes the sources of data for the
variables in the above equation. For ease of calculation, this
discussion regroups the terms (Gi - Ri) +
(GSi - RSi) in the denominator of the above
equation into the terms (Gi + GSi) -
(Ri + RSi).
Calculation of (RFVi - Celli), Total Amount of
Renewable Fuels From Non-cellulosic Sources That Must Be Blended Into
Gasoline in 2008
The Act requires 5.4 billion gallons of renewable fuels to be
blended into gasoline in 2008. Because there is no cellulosic volume
requirement in the Act until 2013, the amount of renewable fuel that
the Act requires to be produced from cellulosic sources in 2008
(Celli) is zero. Thus the total amount of renewable fuels
from non-cellulosic sources that must be blended into gasoline in 2008
is 5.4 billion gallons.
Calculation of (Gi + GSi), Total Amount of
Gasoline Projected To Be Used in the 48 Contiguous States Plus Opt-in
States/Territories, in Year i, in Gallons
The Act requires the Administrator of the EIA by October 31 of each
year to provide EPA with an estimate of the volumes of gasoline
projected to be sold or introduced into commerce in the United States
for the following year. During the development of the RFS Program, EIA
informed EPA that the projected gasoline consumption in ``Table 4a:
U.S. Petroleum Supply, Consumption, and Inventories'' (formerly ``Table
5a. U.S. Petroleum Supply and Demand: Base Case'') of the October issue
of the monthly Short-Term Energy Outlook (STEO) should be used to
calculate the RFS for the coming year. The October 2007 STEO projects
that an average of 9.42 million barrels/day of gasoline will be
consumed in all of the United States in 2008. Multiplying this average
consumption rate by 366 days (2008 is a leap year) produces a total
consumption of 144.80 billion gallons of gasoline in 2008.
Only one non-contiguous state or territory has petitioned EPA to
opt into the RFS Program beginning in 2008. Hawaii petitioned EPA on
June 22, 2007 to opt into the RFS program, and EPA approved their
request.\1\ Thus, Alaska is the only one of the 50 states that is not
included in the RFS Program.
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\1\ Letter to the Honorable Laura Lingle, Governor of Hawaii,
from Stephen Johnson of EPA dated July 30, 2007.
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In order to calculate gasoline consumption in the 48 contiguous
states plus Hawaii, we subtracted Alaska's projected gasoline
consumption from the projected nationwide gasoline consumption of
144.80 billion gallons. Alaska's projected gasoline consumption was
calculated by multiplying the projected nationwide gasoline consumption
in 2008 by the ratio of Alaska's gasoline consumption in 2006 to the
total U.S. consumption in 2006, based on Table 48, ``Prime Supplier
Sales Volumes of Motor Gasoline by Grade Formulation, PAD District, and
State'' gasoline data from EIA's Petroleum Marketing Annual 2006 (the
final rulemaking used data from Petroleum Marketing Annual 2005).
According to EIA, Prime Supplier data reflects where gasoline is used,
rather than where it is produced.\2\ Alaska's projected gasoline
consumption in 2008 is 0.30 billion gallons. Subtracting this
consumption from the projected nationwide consumption of 144.80 billion
gallons in 2008 produces a total consumption of 144.50 billion gallons
of gasoline in 2008 in the 48 contiguous states plus Hawaii.
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\2\ Energy Information Administration, Petroleum Marketing
Annual 2006, Explanatory Notes, Relationship of Refiner and Prime
Supplier Sales Volumes (p. 382).
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Calculation of (Ri + RSi), Total Amount of
Renewable Fuel Blended Into Gasoline That Is Projected To Be Consumed
in the 48 Contiguous States Plus Opt-in States/Territories, in Year i,
in Gallons
The projected gasoline consumption in the October 2007 STEO
includes renewable fuel that is blended into gasoline. This volume of
renewable fuel must be subtracted from the total volume of gasoline in
order to calculate the total consumption of non-renewable gasoline. In
Table 8 of the October 2007 STEO, EIA estimates that 0.755 quadrillion
Btu of ethanol will be used as transportation fuel in all of the United
States in 2008. Dividing this energy usage by the high heating value of
ethanol (3.539 million Btu/barrel), and multiplying by 42 gallons/
barrel produces a total ethanol usage of 8.96 billion gallons
nationwide in 2008.
Since Hawaii has opted in, but Alaska has not opted in, to the RFS
program for 2008, Alaska's renewable fuels consumption must be
subtracted from the nationwide renewable fuels consumption to calculate
renewable consumption in the 48 contiguous states plus Hawaii. In
Chapter 2 of the Regulatory Impact Analysis for the RFS program
rulemaking, EPA estimated that ethanol consumption in Alaska would be
negligible prior to 2012. Thus, we project renewable fuels consumption
in
[[Page 66173]]
the 48 contiguous states plus Hawaii to be 8.96 billion gallons in
2008.\3\
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\3\ Table 2.2-21 ``2012 Forecasted Ethanol Consumption by
State,'' Regulatory Impact Analysis: Renewable Fuel Standard
Program, April 2007.
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Calculation of GEi, Amount of Gasoline Projected To Be
Produced by Exempt Small Refineries and Small Refiners in Year i, in
Gallons \4\
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\4\ Through 2010 only, unless the exemption is extended under
211(o)(9(A)(ii) or (B) of the Act.
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In the final rulemaking, we stated that we would estimate the
combined small refinery and small refiner gasoline volume using a
constant percentage of national consumption. Using information from
gasoline batch reports submitted to EPA, EIA data and input from the
California Air Resources Board regarding California small refiners, we
estimated this percentage to be 13.5%.\5\ Multiplying the projected
nationwide consumption of gasoline in 2008 (144.80 billion gallons) by
13.5% results in a total projected production of 19.55 billion gallons
of gasoline from small refiners and small refineries in 2008.
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\5\ ``Calculation of the Small Refiner/Small Refinery Fraction
for the Renewable Fuel Program,'' memo to the docket from Christine
Brunner, ASD, OTAQ, EPA, September 2006.
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Calculation of RFStdi, Renewable Fuel Standard in Year i, in
Percent
Substituting all of the terms calculated above into the equation
for RFStdi results in the following RFS for 2008,
[GRAPHIC] [TIFF OMITTED] TN27NO07.005
Therefore, the RFS for 2008 is 4.66%. This is the standard
referenced in 40 CFR 80.1105(b) through (d) and which obligated parties
apply to determine their renewable volume obligation under 40 CFR
80.1107.
Dated: November 20, 2007.
Stephen L. Johnson,
Administrator.
[FR Doc. E7-23095 Filed 11-26-07; 8:45 am]
BILLING CODE 6560-50-P