Regulation of Fuels and Fuel Additives: Modifications to Renewable Fuel Standard Program

Regulation of Fuels and Fuel Additives: Modifications to Renewable Fuel Standard Program

Regulation of Fuels and Fuel Additives: Modifications to Renewable Fuel Standard Program

Gina McCarthy
Environmental Protection Agency
October 22, 2013

[Federal Register Volume 78, Number 204 (Tuesday, October 22, 2013)]
[Rules and Regulations]
[Pages 62462-62471]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-24280]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 80

[EPA-HQ-OAR-2012-0223; FRL-9900-89-OAR]
RIN 2060-AR87

Regulation of Fuels and Fuel Additives: Modifications to
Renewable Fuel Standard Program

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: In this final rule EPA is amending the definition of ``heating
oil'' in the regulations for the Renewable Fuel Standard (RFS) program
under section 211(o) of the Clean Air Act. This amendment expands the
scope of renewable fuels that can be used to show compliance with the
RFS renewable fuel volume obligations by adding an additional category
of compliant renewable fuel referred to as ``fuel oils,'' produced from
qualifying renewable biomass and used to generate heat to warm
buildings or other facilities where people live, work, recreate, or
conduct other activities. Producers or importers of fuel oil that meets
the amended definition of heating oil will be allowed to generate
Renewable Identification Numbers (RINs), provided that the fuel oil
meets all other requirements specified in the RFS regulations. Fuel
oils used to generate process heat, power, or other functions are not
included in this additional category of heating oil. All fuels
previously included in the definition of heating oil continue to be
included as heating oil for purposes of the RFS program.
We are also finalizing specific registration, reporting, product
transfer document, and recordkeeping requirements applicable
specifically to these fuel oils, necessary to demonstrate that the fuel
oil volume for which RINs were generated was or will be used to heat
buildings for climate control for human comfort prior to generating
RINs.
The final rule is being adopted with only minor changes from the
rule proposed on October 9, 2012, and responses to public comments are
provided.

DATES: This rule is effective on December 23, 2013.

ADDRESSES: EPA established a docket for this action under the Docket ID
No. EPA-HQ-OAR-2012-0223. All documents in the docket are listed in the
www.regulations.gov index. Although listed in the index, some
information may not be publicly available (e.g., CBI or other
information whose disclosure is restricted by statute). Certain other
material, such as copyrighted material, will be publicly available only
in hard copy. Publicly available docket materials are available either
electronically at 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 20460. 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. You may be charged a reasonable fee for photocopying
docket materials, as provided for in 40 CFR part 2.

FOR FURTHER INFORMATION CONTACT: Suzanne Bessette, Office of
Transportation and Air Quality, U.S. Environmental Protection Agency,
2000 Traverwood Dr., Ann Arbor, MI 48105; telephone number: (734) 214-
4703; fax number: (734) 214-4869; email address:
bessette.suzanne@epa.gov.

[[Page 62463]]

SUPPLEMENTARY INFORMATION:

I. Executive Summary

A. Purpose

This final rule expands the regulatory definition of ``heating
oil'' for purposes of the RFS program. This expansion of the types of
fuel that can be considered heating oil under the RFS program furthers
the goals of the Energy Independence and Security Act of 2007 (EISA) to
reduce the use of fossil fuels and encourage increased production of
renewable fuels. The EPA expects this rule to allow for the generation
of additional advanced and cellulosic RINs, which will help enable
obligated parties under the RFS to meet their renewable fuel
obligations and offer their customers more alternative fuel products.

B. Summary of Today's Rule

This rule amends the definition of ``heating oil'' in 40 CFR
80.1401 in the RFS program promulgated under section 211(o) of the
Clean Air Act (CAA). This amendment expands the scope of renewable
fuels that can generate RINs as heating oil by adding an additional
category of fuel oils that will be used to generate heat to warm
buildings or other facilities where people live, work, recreate, or
conduct other activities. Fuel oils used to generate process heat,
power, or other functions are not included in this additional category
of heating oil. This rule will allow producers or importers of fuel oil
that meets the amended definition of heating oil to generate RINs,
provided that other requirements specified in the regulations are met.
These include new registration, reporting, product transfer document,
and recordkeeping requirements applicable specifically to these fuel
oils, necessary to demonstrate that the fuel oil volume was or will be
used to heat buildings for climate control for human comfort prior to
generating RINs.
The amendment expands the fuels included in the definition of
heating oil for purposes of the RFS program. All fuels previously
included in the definition of heating oil continue to be included as
heating oil under 40 CFR 80.1401 for purposes of the RFS program.

C. Costs and Benefits

This amendment provides new opportunities for RIN generation under
the RFS program. Therefore, EPA believes that this amendment will
impose no new direct costs or burdens on regulated entities beyond the
minimal costs associated with reporting and recordkeeping requirements.
At the same time, EPA does not believe that this amendment will
adversely impact emissions.

II. Does this action apply to me?

Entities potentially affected by this action include those involved
with the production, distribution and sale of transportation fuels,
including gasoline and diesel fuel, or renewable fuels such as ethanol
and biodiesel, as well as those involved with the production,
distribution and sale of other fuel oils that are not transportation
fuel. Regulated categories and entities affected by this action
include:

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NAICS codes Examples of potentially regulated
Category \a\ SIC codes \b\ parties
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Industry................................... 324110 2911 Petroleum refiners, importers.
Industry................................... 325193 2869 Ethyl alcohol manufacturers.
Industry................................... 325199 2869 Other basic organic chemical
manufacturers.
Industry................................... 424690 5169 Chemical and allied products
merchant wholesalers.
Industry................................... 424710 5171 Petroleum bulk stations and
terminals.
Industry................................... 424720 5172 Petroleum and petroleum products
merchant wholesalers.
Industry................................... 454319 5989 Other fuel dealers.
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\a\ North American Industry Classification System (NAICS).
\b\ Standard Industrial Classification (SIC) system code.

This table is not intended to be exhaustive, but rather provides a
guide for readers regarding entities likely to be regulated by this
action. This table lists the types of entities that EPA is now aware
could be potentially regulated by this action. Other types of entities
not listed in the table could also be regulated. To determine whether
your entity is regulated by this action, you should carefully examine
the applicability criteria of Part 80, subpart M of title 40 of the
Code of Federal Regulations. If you have any questions regarding
applicability of this action to a particular entity, consult the person
in the preceding FOR FURTHER INFORMATION CONTACT section above.

III. Amendments to the Renewable Fuel Standard Program

A. Amended Definition of Heating Oil

EPA is issuing this final rule to amend the definition of heating
oil in 40 CFR 80.1401 in the RFS program promulgated under section
211(o) of the CAA.\1\ This amendment will expand the scope of renewable
fuels that can generate RINs as heating oil to include fuel oil that
will be used to generate heat to warm buildings or other facilities
where people live, work, recreate, or conduct other activities. This
rule will allow producers or importers of fuel oil that meets the
amended definition of heating oil to generate RINs, provided that other
requirements specified in the regulations are met, including new
registration, reporting, product transfer document, and recordkeeping
requirements being finalized in this action that are applicable
specifically to these fuel oils. Fuel oils used to generate process
heat, power, or other functions will not be approved for RIN generation
under the amended definition of heating oil, as these fuels are not
within the scope of ``home heating oil'' as that term is used in EISA,
for the RFS program. All fuels previously included in the definition of
heating oil continue to be included as heating oil under 40 CFR 80.1401
for purposes of the RFS program.
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\1\ The Energy Independence and Security Act of 2007 (EISA)
amended section 211(o) of the Clean Air Act, which was originally
added by the Energy Policy Act of 2005 (EPAct).
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The RFS program requires the production and use of renewable fuel
to replace or reduce the quantity of fossil fuel present in
transportation fuel. Under EPA's RFS program, producers or importers of
qualified renewable fuel generate RINs which represent the volume of
renewable fuel that has been produced or imported. RINs are transferred
to the producers or importers of gasoline and diesel transportation
fuel who then use the RINs to demonstrate compliance with their
renewable fuel volume obligations. RINs also serve the function of
credits under the RFS program for regulated

[[Page 62464]]

parties who exceed their annual volume obligation.
Congress provided that EPA could establish provisions for the
generation of credits by producers of certain renewable fuel that was
not used in transportation fuel, called ``additional renewable fuel.''
\2\ Additional renewable fuel is defined as fuel produced from
renewable biomass that is used to replace or reduce the quantity of
fossil fuel present in home heating oil or jet fuel.\3\ In essence,
additional renewable fuel has to meet all of the requirements
applicable to qualify it as renewable fuel under the regulations, with
the only difference being that it is blended into or is home heating
oil or jet fuel instead of transportation fuel. This does not change
the volume requirements of the statute itself, but it can provide an
important additional avenue for parties to generate RINs for use by
obligated parties, thus promoting the overall cost-effective production
and use of renewable fuels.
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\2\ 75 FR 14670, 14686 (March 26, 2010).
\3\ See CAA sections 211(o)(1)(A) and (o)(5)(E).
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EPA addressed the provision for additional renewable fuels in the
final rule published on March 26, 2010 (74 FR 14670), specifically
addressing the category of ``home heating oil.'' EPA determined that
this term was ambiguous, and defined it by incorporating the existing
definition of heating oil at 40 CFR 80.2(ccc). EPA stated that:

EISA uses the term ``home heating oil'' in the definition of
``additional renewable fuel.'' The statute does not clarify whether
the term should be interpreted to refer only to heating oil actually
used in homes, or to all fuel of a type that can be used in homes.
We note that the term `home heating oil' is typically used in
industry in the latter manner, to refer to a type of fuel, rather
than a particular use of it, and the term is typically used
interchangeably in industry with heating oil, heating fuel, home
heating fuel, and other terms depending on the region and market. We
believe this broad interpretation based on typical industry usage
best serves the goals and purposes of the statute. If EPA
interpreted the term to apply only to heating oil actually used in
homes, we would necessarily require tracking of individual gallons
from production through ultimate [use] in homes in order to
determine eligibility of the fuel for RINs. Given the fungible
nature of the oil delivery market, this would likely be sufficiently
difficult and potentially expensive so as to discourage the
generation of RINs for renewable fuels used as home heating oil.
This problem would be similar to that which arose under RFS1 for
certain renewable fuels (in particular biodiesel) that were produced
for the highway diesel market but were also suitable for other
markets such as heating oil and non-road applications where it was
unclear at the time of fuel production (when RINs are typically
generated under the RFS program) whether the fuel would ultimately
be eligible to generate RINs. Congress eliminated the complexity
with regards to non-road applications in RFS2 by making all fuels
used in both motor vehicle and nonroad applications subject to the
renewable fuel standard program. We believe it best to interpret the
Act so as to also avoid this type of complexity in the heating oil
context. Thus, under today's regulations, RINs may be generated for
renewable fuel used as ``heating oil,'' as defined in existing EPA
regulations at Sec. 80.2(ccc). In addition to simplifying
implementation and administration of the Act, this interpretation
will best realize the intent of EISA to reduce or replace the use of
fossil fuels.\4\
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\4\ 75 FR 14670, 14687 (March 26, 2010).

The existing definition of heating oil at 40 CFR 80.2(ccc) is ``any
1, 2, or non-petroleum diesel blend that is sold for
use in furnaces, boilers, and similar applications and which is
commonly or commercially known or sold as heating oil, fuel oil, or
similar trade names, and that is not jet fuel, kerosene, or MVNRLM
[Motor Vehicle, Non-Road, Locomotive and Marine] diesel fuel.'' \5\ The
existing definition of non-petroleum diesel at 40 CFR 80.2(sss) is ``a
diesel fuel that contains at least 80 percent mono-alkyl esters of long
chain fatty acids derived from vegetable oils or animal fats.'' Thus,
under the existing definitions, RINs may be generated for heating oil
that is either a 1 or 2 fuel oil or a non-petroleum
diesel blend containing at least 80 percent mono-alkyl esters of long
chain fatty acids derived from vegetable oils or animal fats, as well
as meeting all other requirements of the RFS regulations for renewable
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fuels.

\5\ The reference to ``stationary diesel engines'' was removed
from the definition of 40 CFR 80.2(ccc) as part of EPA's final rule
concerning oceangoing vessels. 75 FR 22896 (April 30, 2010).
Deleting this example from the definition avoids confusion that
otherwise might arise, given the requirements under 40 CFR 60.4207
for use of ultra low sulfur diesel fuel in certain stationary diesel
engines. See 40 CFR 60.4207, applicable beginning with model year
2007.
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The existing regulations do not allow a party to generate RINs for
a non-petroleum fuel that is used as a heating oil unless the fuel
contains at least 80 percent mono-alkyl esters of long chain fatty
acids derived from vegetable oils or animal fats. Since the
promulgation of the March 26, 2010 rule, we have received a number of
requests from producers to consider expanding the scope of the home
heating oil provision to include additional fuel oils that are produced
from qualifying renewable biomass but do not meet the regulatory
definition of heating oil because they are not 1 or 2
diesel and are not non-petroleum diesel containing at least 80 percent
mono-alkyl esters. Parties raising this issue have suggested that
limiting ``home heating oil'' to the fuel types defined in 40 CFR
80.2(ccc) disqualifies certain types of renewable fuel oils that could
be used for home heating and that this limitation does not align with
our reasoning in the preamble to take a broad interpretation of the
term ``home heating oil'' in CAA section 211(o).
EPA considered this issue further and issued a direct final rule
and parallel proposed rule to amend the definition of heating oil in
the RFS program to expand the scope of fuels that can generate RINs as
heating oil under the RFS program.\6\ EPA received adverse public
comment and withdrew the direct final rule.\7\
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\6\ 77 FR 61281 (October 9, 2012); 77 FR 61313 (October 9,
2012).
\7\ 77 FR 72746 (December 6, 2012).
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After considering the public comments, EPA is revising the
definition of heating oil for purposes of the RFS program to include an
additional category of fuel oil, as proposed. RINs may be generated for
an additional category of renewable fuel that is fuel oil used to heat
interior spaces of homes or buildings to control ambient climate for
human comfort. This additional category will not include fuel oils used
to generate process heat, power, or other functions. The fuel oil must
be used to generate heat to warm buildings or other facilities where
people live, work, recreate, or conduct other activities. The fuel oil
must only be used in heating applications, where the sole purpose of
the fuel is for heating and not for any other combined use such as
process energy use. This is in addition to the fuel oils previously
included in the definition of heating oil at 40 CFR 80.1401, which
refers to section 80.2(ccc). All fuels previously included in the
definition of heating oil continue to be included as heating oil under
40 CFR 80.1401 for purposes of the RFS program.
EPA believes this expansion of the scope of the home heating oil
provision is appropriate and authorized under CAA section 211(o). As
EPA described in the RFS final rule, Congress did not define the
statutory term ``home heating oil,'' and it does not have a fixed or
definite commercial meaning. In the March 26, 2010 final rule, EPA
focused on whether the provision was limited to heating oil actually
used in homes. EPA noted that the term home heating oil is usually used
in the industry to refer to one type of fuel, and not to a specific

[[Page 62465]]

use for the fuel. Given this more general usage of the term, EPA
defined home heating oil by identifying the types of fuel oils that are
typically used to heat homes. EPA determined this was a reasonable
interpretation of an ambiguous statutory provision that simplified
implementation and administration of the Act and promoted achievement
of the goals of the RFS program.
The expansion of the definition adopted in this rulemaking will add
a category to the definition to include two types of fuel oils not
included in the original definition of heating oil in section 80.1401.
First, the new category will include additional fuel oils that do not
meet the definition of heating oil in section 80.2(ccc) but are
actually used to heat homes.
Second, the new category will include fuel oils that are used to
heat facilities other than homes to control ambient climate for human
comfort. Under the original definition of heating oil in section
80.1401, a fuel oil meets the definition of heating oil based on its
physical properties, not whether it is actually used to heat a home. In
the new category added in the amended definition, the additional
qualifying fuel oils will be used for heating places where people live,
work, or recreate, and not just their homes. It focuses more on what is
getting heated--people--and not where the people are located. EPA
believes this is a reasonable interpretation of the phrase ``home
heating oil.'' This interpretation recognizes the ambiguity of the
phrase used by Congress, which is not defined and does not have a clear
and definite commercial meaning. It gives reasonable meaning to the
term home heating oil, both by limiting the additional fuel oils to
fuel oils used for heating facilities that people will occupy, and
excluding the additional fuel oils when used for other purposes such as
generation of energy used in the manufacture of products. It also
focuses on the aspect of home that is most important here--the heating
of people. This interpretation also promotes the purposes of the EISA
in that it will increase the production and use of renewable fuels by
introducing new sources of fuel producers to the RFS program. It will
specifically promote the RFS programmatic goals by facilitating the
generation of RINs for renewable fuels that reduce emissions of
greenhouse gases compared to fossil fuels. For example, EPA has
received information from Envergent Technologies (an alliance of Ensyn
and UOP/Honeywell) that such an expanded definition of heating oil
would result in nearly immediate production of 3.5 million gallons from
their existing facilities, with an additional projected production of
up to 45 million gallons per year within 24 months following regulatory
action. Based on this information from Envergent Technologies and other
parties who commented on the proposed rule, the application of the
expanded definition of heating oil to the entire industry would result
in the production of many more million additional gallons of RIN-
generating renewable fuel.

B. Lifecycle Greenhouse Gas Assessment of the Amended Definition of
Heating Oil

EPA has also evaluated whether any revisions will need to be made
to Table 1 to 40 CFR 80.1426. Table 1 lists the applicable D codes for
each fuel pathway for use in generating RINs in the RFS regulations in
light of the additional fuel oils included in the expanded definition
of heating oil. As discussed below, EPA has determined that the
existing D code entries for heating oil in Table 1 to 40 CFR 80.1426
will continue to be appropriate and will not need to be revised in
light of the expanded definition of heating oil.
Under the RFS program, EPA must assess lifecycle greenhouse gas
(GHG) emissions to determine which fuel pathways meet the GHG reduction
thresholds for the four required renewable fuel categories. The RFS
program requires a 20% reduction in lifecycle GHG emissions for
conventional renewable fuel (except for grandfathered facilities and
volumes), a 50% reduction for biomass-based diesel or advanced biofuel,
and a 60% reduction for cellulosic biofuel. For the final March 2010
RFS rule, EPA assessed the lifecycle greenhouse gas emissions of
multiple renewable fuel pathways and classified pathways based on these
GHG thresholds, as compared to the EISA statutory baseline.\8\ In
addition, EPA has added several pathways since the final rule was
published. Expanding the definition of heating oil does not affect
these prior analyses.
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\8\ See Table 1 to 40 CFR Sec. 80.1426.
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The fuel pathways consist of fuel type, feedstock, and production
process requirements. GHG emissions are assessed at all points
throughout the lifecycle pathway. For instance, emissions associated
with sowing and harvesting of feedstocks and in the production,
distribution and use of the renewable fuel are examples of what are
accounted for in the GHG assessment. A full accounting of emissions is
then compared with the petroleum baseline emissions for the
conventional fuel being replaced. The lifecycle GHG emissions
determination is one factor used to determine compliance with the
regulations.
There are currently several fuel pathways that list heating oil as
a fuel type with various types of feedstock and production processes
used, qualifying the heating oil pathways as either biomass-based
diesel, advanced, or cellulosic. The determinations for these different
pathways were based on the current definition of heating oil. The
pathways also include several types of distillate product including
diesel fuel, jet fuel and heating oil.
The lifecycle calculations and threshold determinations are based
on the GHG emissions associated with production of the fuel and
processing of the feedstock. Converting biomass feedstocks such as
triglycerides (if oils are used as feedstock) or hemi-cellulose,
cellulose, lignin, starches, etc. (if solid biomass feedstock is used)
into heating oil products can be accomplished through either a
biochemical or thermochemical process converting those molecules into a
fuel product. The existing heating oil pathways were based on the
original definition of heating oil in section 80.1401, and were based
on a certain level of processing to produce 1, 2, or
a non-petroleum diesel blend and the related energy use and GHG
emissions that were part of the lifecycle determination for those fuel
pathways.
The main difference between the original definition of heating oil,
which refers to 1, 2, or a non-petroleum diesel
blend, and the new category added in the expanded definition adopted in
this rulemaking is that the new category will include heavier types of
fuel oil with larger molecules. Based on the type of conversion
process, producing these heavier fuel oil products versus the
1, 2, or a non-petroleum diesel blend will affect the
amount of energy used and therefore the GHG emissions from the process.
There are two main paths for producing a fuel oil product from biomass.
In one the biomass is converted into a biocrude which is further
refined into lighter products. In this case, producing a heavier fuel
oil product will require less processing energy and have lower GHG
emissions than converting the same feedstock into a 1,
2, or non-petroleum diesel blend.
In the other type of process, the compounds in the biomass are
changed into a set of intermediary products, such as hydrogen (H) and
carbon monoxide

[[Page 62466]]

(CO).\9\ These compounds are then either catalytically or biochemically
converted into the fuel product. In this case, the vast majority of the
energy is associated with breaking down the feedstock into the set of
intermediary compounds. The process used and the energy needed for it
does not vary based on the type of fuel that is then produced from
these intermediary compounds. The type of fuel could affect the type of
catalyst or biological process used to change the intermediary
compounds into the fuel product, but based on EPA calculations and
assessments developed as part of the March 26, 2010 RFS rulemaking,\10\
this will have no real impact on the energy used or the GHG emissions
associated with converting the biomass into a different fuel product.
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\9\ This describes the Fischer-Tropsch process. Other processes
rely on forming different sets of compounds from the biomass, and
then producing the fuel product from the set of compounds.
\10\ ``Regulation of Fuel and Fuel Additives; Changes to
Renewable Fuel Standard Program,'' 75 FR 14670, available at http://www.gpo.gov/fdsys/pkg/FR-2010-03-26/pdf/2010-3851.pdf. See also,
EPA's summary factsheet, ``EPA Lifecycle Analysis of Greenhouse Gas
Emissions from Renewable Fuels,'' available at http://www.epa.gov/otaq/renewablefuels/420f10006.pdf.
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Based on these considerations, EPA believes the GHG emissions
associated with producing the additional fuel oils included in the
expanded definition will be the same or lower than the GHG emissions
associated with producing a 1, 2, or non-petroleum
diesel blend. Therefore, the original lifecycle analyses for heating
oil support applying the existing pathways for heating oil in the RFS
regulations to the expanded definition of heating oil. Once the
regulatory change to the definition of heating oil is final, all of the
pathways currently applicable to heating oil under Table 1 to 40 CFR
80.1426 will apply to the expanded definition of heating oil.

C. Additional Registration, Reporting, Product Transfer Document, and
Recordkeeping Requirements

An important issue to address is how to implement such an expanded
definition. EPA recognized in the March 26, 2010 rule that it would be
difficult and expensive to track heating oil to make sure it was
actually used in homes, and so decided to define home heating oil as a
type of fuel with certain characteristics, rather than a fuel used in a
certain way. This approach avoided the need to track heating oil to its
actual end use, and the definition of heating oil at 40 CFR 80.1401
simply referred back to the 40 CFR 80.2(ccc) technical definition.
The expansion of the definition raises this same issue but in a
more significant way. The original definition does not provide a way to
assure that RINs are only generated for fuel oils used to heat
buildings for climate control for human comfort, and not for those used
to generate process heat or other purposes. Therefore, for the
additional fuel oils other than those qualifying as heating oil based
on the definition in 40 CFR 80.2(ccc), EPA is requiring that the
renewable fuel producer or importer have adequate documentation to
demonstrate that the fuel oil volume for which RINs were generated was
or will be used to heat buildings for climate control for human comfort
as a condition for generating RINs.
EPA recognizes that for fuels meeting the original definition of
heating oil in section 80.1401, no tracking or other documentation of
end use is required, and some heating oils that meet the original
definition could end up being used for other purposes. However, fuel
qualifying as heating oil under the original definition has to have the
physical or other characteristics that make it the type of fuel oil
normally used to heat homes. The additional fuel oils qualifying as
heating oil under the new category of the expanded definition will be
identified as heating oil not by their chemical specifications but
instead by their actual use for heating for the purposes of climate
control for human comfort. EPA is not requiring physical specifications
for the additional fuel oil category, beyond the requirement that it be
a ``fuel oil'', meaning that it is a liquid at 60 degrees Fahrenheit
and one atmosphere of pressure and contains no more than 2.5% mass
solids. Solid or gaseous fuels, for example wood chips or unrefined
waste fats or gases, would not qualify as heating oil capable of
generating RINs under the RFS.
For informational purposes, there are industry standard
specifications for fuel oils that could qualify as heating oils under
the expanded definition of heating oil. For example, ASTM D396 covers
grades of fuel oil intended for use in fuel oil burning equipment, ASTM
D7666 covers two grades of burner fuel consisting of triglycerides and
naturally occurring constituents of triglycerides including
monoglycerides, diglycerides, and free fatty acids and distinguished by
the pour point, and ASTM D7544 covers grades of pyrolysis liquid
biofuel produced from biomass intended for use in fuel oil burner
equipment. These and other fuel oils would also have to meet the
requirements related to use of the fuel oil for heating, as well as any
other regulatory requirements applicable under the RFS program.
In order to verify that the fuel oils are actually used to generate
heat for climate control purposes, EPA is adopting the following
registration, recordkeeping, product transfer document (PTD) and
reporting requirements. These requirements will not apply to fuels
qualifying under the original part of the 40 CFR 80.1401 definition,
i.e., they would not apply to fuels that meet the definition of heating
oil in section 80.2(ccc). These requirements will only apply to the
additional fuel oils qualifying under the new category of the expanded
definition in 40 CFR 80.1401. If those fuel oils are designated for but
not actually used to generate heat for climate control purposes, the
end user of that fuel oil is subject to and liable for violations of
the RFS regulations and the CAA, as are as any parties that caused that
violation. Also, pursuant to the existing regulation in Sec.
80.1460(c)(2), the end user in this situation would not be allowed to
retire RINs still associated with the fuel oil for RVO compliance
purposes or transfer such RINs to any other party. Finally, since the
additional category of fuel oils is defined as heating oil in terms of
its use instead of its physical characteristics, EPA must ensure as far
as is practicable that the RIN-generating renewable fuel is actually
used for the proper purpose by the end user. We believe it is
reasonable to require that the RIN-generating renewable fuel producer
or importer document that the appropriate end use of the fuel is
certified by an end user. As further discussed below, the RIN generator
must submit proof of such assurances to EPA in its registration and
quarterly reports.
Once the fuel producer has the appropriate affidavit from the end
user certifying that it has used or intends to use the fuel for the
proper purpose, the fuel producer may validly generate RINs for the
fuel. We emphasize that subsequent improper end use would not
invalidate any RINs generated by the fuel producer for that volume of
fuel oil. We are not requiring that the RIN-generating producer track
the fuel's actual end use; only that the fuel be sold for use as a
heating oil and that the fuel producer receives the appropriate
affidavit from the end user attesting that the fuel has or will
actually be used as a heating oil prior to RIN generation. A RIN will
not be considered valid unless the renewable producer can demonstrate
by the end user's affidavit that the fuel has or will actually be used
as heating oil. Parties that purchase RINs generated by renewable fuel
producers that rely on this new definition will be able to evaluate
whether the proper use requirement is

[[Page 62467]]

met by examining these affidavits. Therefore, while there is a slight
chance that the fuel associated with a validly generated RIN may be
improperly used, once the appropriate certification is made, the RIN
may be generated and will remain valid regardless of the actual end
use.
1. Registration
For the purpose of registration, EPA is allowing the producer of
the expanded fuel oil types to establish its facility's baseline volume
in the same manner as all other producers under the RFS program, e.g.,
based on the facility's permitted capacity or actual peak capacity.
Additionally, we are requiring producers of the new category fuel oils
to submit affidavits in support of their registrations, including a
statement that the RIN generating fuel will be used for the purposes of
heating interior spaces of homes or buildings to control ambient
climate for human comfort, and no other purpose. We also require that
producers submit secondary affidavits from the existing end users to
verify that the fuel oil is actually being used for or is intended for
a qualifying purpose. We are also adopting new reporting, product
transfer documents (PTD), and recordkeeping requirements, discussed
below, that will help assure that the qualifying fuel oil is being used
in an approved application. These requirements are necessary to provide
assurance that the fuel oil used to generate RINs is actually used for
a qualifying purpose because these types of fuel may not have
previously been used as heating oil, and may not be readily
identifiable by their physical characteristics. Without such
safeguards, EPA could not be confident that the fuel oil is used as
heating oil, and end users might not have adequate notice that the fuel
oil must be used as heating oil. EPA believes these requirements will
place a small but necessary burden on producers and end users, and
greatly benefit the integrity of the program.
2. Reporting, Product Transfer Documents and Recordkeeping Requirements
For the purpose of continued verification after registration, EPA
is adopting additional requirements for reporting in Sec.
80.1451(b)(1)(ii)(T), PTDs in Sec. 80.1453(d), and recordkeeping in
Sec. 80.1454(b), for the new category of fuel oils qualifying as
heating oil.
The reporting, PTD, and recordkeeping requirements will help ensure
that the new category of fuel oils used to generate RINs are actually
used for the appropriate purpose of heating interior spaces for human
comfort. For reporting, producers are required to file quarterly
reports with EPA that identify certain information about the volume of
fuel oil produced and used as heating oil. The additional reporting
requirements stipulate that the producer of fuel oils submit affidavits
to EPA reporting the total quantity of the fuel oils produced, the
total quantity of the fuel oils sold to end users, and the total
quantity of fuel oils sold to end users for which RINs were generated.
Additionally, affidavits from each end user must be obtained by the
producer and reported to EPA, describing the total quantity of fuel
oils received from the producer, the total amount of fuel oil used for
qualifying purposes, the date the fuel oil was received from the
producer, the blend level of the fuel oil, quantity of assigned RINs
received with the renewable fuel, and quantity of assigned RINs that
the end user separated from the renewable fuel, if applicable.
The additional product transfer document requirement associated
with the new category of heating oil is that a PTD must be prepared and
maintained between the fuel oil producer and the final end user for the
legal transfer of title and custody of a specific volume of fuel oil
that is designated for use only for the purpose of heating interior
spaces of buildings to control ambient climate for human comfort. This
additional PTD requirement requires that the PTD used to transfer
ownership and custody of the renewable fuel must contain the statement:
``This volume of renewable fuel oil is designated and intended to be
used to heat interior spaces of homes or buildings to control ambient
climate for human comfort. Do NOT use for process heat or any other
purpose, as these uses are prohibited pursuant to 40 CFR 80.1460(g).''
EPA believes that this PTD requirement will help to ensure that each
gallon of fuel oil that is transferred from the producer to the end
user is used for qualifying purposes under the expanded definition of
heating oil. If the fuel oil is used for some non-qualifying purpose
instead of for generating heat for climate control purposes, then the
end user of that fuel oil is subject to and liable for violations of
the RFS regulations and the CAA, as are any parties that caused that
violation.
The additional recordkeeping requirement for the new category of
heating oil is that producers must keep copies of the contracts which
describe the fuel oil under contract with each end user. If the
producer is not selling the fuel oil directly to the end user, this may
require the collection of one or more intermediate contracts showing
the chain of custody of the fuel oil from the producer to the end user.
Consistent with existing regulations, producers are required to
maintain all documents and records submitted for registration,
reporting, and PTDs as part of the producer's recordkeeping
requirements. EPA believes the producer's maintenance of these records
will allow for continued tracking and verification that the end use of
the fuel oil is consistent with the meaning of ``heating oil'' intended
under EISA.

IV. Summary and Analysis of Comments

EPA has provided a summary of the comments received and its
response. EPA has developed a more thorough Response to Comments
document that addresses each comment specifically and addresses
requests for clarification to the extent appropriate for this rule.\11\
---------------------------------------------------------------------------

\11\ Regulation of Fuels and Fuel Additives: Modifications to
Renewable Fuel Standard Program Response to Comments, available in
the docket at http://www.regulations.gov.
---------------------------------------------------------------------------

Clarification on Existing Definition of Heating Oil

Comment
Several commenters sought a variety of clarifications on changes
being made to the existing definition of heating oil in section
80.1401.
Response
As explained in this final rule and the October 9, 2012 proposal,
this amendment does not modify, limit, or in any way change the
inclusion of fuels covered by the existing definition of heating oil at
section 80.1401. All fuels included in the original definition of
heating oil at section 80.1401 (i.e., those fuels that meet the
definition of heating oil at section 80.2(ccc)) will continue to be
included as heating oil for purposes of section 80.1401 and the RFS
program.

Need for the Expanded Definition of Heating Oil

Comment
Several commenters expressed support for the expanded definition of
heating oil. These commenters noted that the current definition is
overly restrictive and inconsistent with the goals of the RFS program,
and stated that the expanded definition will spur production of
cellulosic biofuel from woody, biomass-based resources. Also, these
commenters believe that the expanded definition will drive tens of
millions of dollars of local investment and create jobs.

[[Page 62468]]

Response
As explained in greater detail above, EPA believes this expansion
of the scope of the definition of heating oil for purposes of the RFS
program is appropriate and authorized under CAA section 211(o).

Fuel Quality Standards

Comment
Commenters noted that the expanded definition of heating oil will
not reference fuel quality standards, which they believed may present
environmental and safety concerns. Specifically, one commenter (Global
Renewable Strategies and Consulting (GRSAC)) asserted that the
definition fails to consider the environment or safety, and should
reference ASTM standards for fuel oils.
Response
Section 211(o) of the Clean Air Act, as amended by EISA, requires
all renewable fuels used in the RFS program to be derived from
renewable biomass and to meet specified thresholds for reductions in
lifecycle greenhouse gas emissions compared to a baseline fossil fuel.
Adding fuel quality specifications for the fuel oils added to the
definition of ``heating oil'' in this rule would not affect whether the
fuel oil was derived from renewable biomass, and would not affect the
analysis of lifecycle greenhouse gas emissions associated with the
heating oils. Thus the additional specifications suggested by the
commenters are not relevant to the issues needed to determine whether
the fuel oils would qualify as renewable fuel for purposes of the RFS
program.
The purpose this regulation is to further define what types and
uses of renewable fuel qualify for RIN generation, not to set safety
standards or limitations for renewable heating oil. Such standards and
limitations may be imposed by other regulations and regulatory
entities, and through private sales agreements, by manufacturers of
heating equipment, and so on. For example, we expect that many of these
fuel oils will meet ASTM specifications for fuel oils (e.g., ASTM D396,
ASTM D7666, and ASTM D7544). The ASTM fuel oil specifications not only
provide fuel quality specifications, they also indicate appropriate
uses for the fuel oils meeting the specification. Because the specific
use of a particular fuel oil is often dependent upon the fuel oil
conforming to the ASTM specification for that fuel oil, industry
specification and use would provide a de facto application of fuel oil
specifications for fuel oil used as heating oil. This de facto control
would occur naturally within the course of business; an added
regulatory requirement in the RFS regulations would not add value or
provide any benefit, and as noted above is not relevant to the issues
needed to determine whether the fuel oil is a renewable fuel for
purposes of the RFS program.

Power Generation

Comment
Several commenters recommended that the expanded definition of
heating oil should also include fuel oils used for power generation.
Response
The restriction on use for the additional fuel oils is necessary so
that the additional fuel oils can reasonably be considered ``home
heating oil.'' Congress allowed ``home heating oil'', not any and all
fuel oils, to be considered an additional renewable fuel for purposes
of the RFS program. EPA's expanded definition of heating oil includes
fuel oils that are used for heating places where people live, work, or
recreate, and not just their homes. EPA believes this is a reasonable
interpretation of the phrase ``home heating oil'' and recognizes the
ambiguity of the phrase used by Congress, which is not defined and does
not have a clear and definite commercial meaning. It gives reasonable
meaning to the term home heating oil by limiting them to fuel oils used
for heating of facilities that people will occupy, and excludes fuel
oils used for other purposes such as generation of energy used in the
manufacture of products. It also focuses on the aspect of home that is
important here--the heating of people--recognizing that EPA has already
determined that fuel oil can be included in the scope of home heating
oil even if it is not actually used to heat a home.

Need for Compliance Provisions Associated With the Expanded Definition

Comment
We received several comments regarding the compliance provisions
associated with the expanded definition, including the affidavit
requirement for RFS registration, reporting requirements, PTD
requirements, and end use tracking required for recordkeeping.
Commenters who are ready to produce renewable fuel oils for use as
heating oil expressed their understanding of the need for affidavits
and their ability to comply with the requirements based on existing and
prospective customers.
Other commenters believe that these requirements are not necessary
and that they will not be able to comply with the affidavit
requirements. For example, two biomass-based diesel producers asserted
that they would be unable to submit affidavits because their fuel
product does not currently qualify as heating oil under the RFS. These
producers also commented that many of their potential customers will
not sign the required affidavits out of fear of potential legal
ramifications. At the same time, parties interested in blending No.4
and No.6 diesel to be used as heating oil asserted that the affidavit
requirements will be unworkable for their existing commercial
arrangements, which tend to be informal, with small customers whose
employees are not sophisticated enough to comply with the tracking
requirements.
Response
EPA believes that the compliance provisions added by this final
rule are necessary and appropriate to ensure, as far as is practicable,
that the additional fuel oils under the expanded definition meet the
requirements of heating oil for purposes of the RFS program. Fuel oils
that generate RINs under this expanded definition are those that
actually heat places where people live, work, or recreate, and are not
used for other purposes such as generating process energy. These
additional fuel oils are not readily identifiable based on their
physical characteristics, so the additional registration, recordkeeping
and reporting requirements are designed to ensure they in fact meet the
expanded definition of heating oil as far as can practically be
determined at the time of RIN generation. These requirements are
tailored to be the least restrictive possible while reasonably ensuring
compliance with the amended definition of heating oil.
Such requirements are necessary to ensure RFS programmatic
integrity, specifically, that RINs generated for the additional fuel
oils represent fuel oils that qualify under the amended definition.
Therefore, EPA is requiring producers to identify the end users of
their fuel oil at the time of registration. Producers who have not
identified any end users for their product will not be able to produce
fuel oil for use as heating oil and generate RINs. EPA is aware of
producers who have customers willing to sign such affidavits. EPA
believes it is reasonable and producers typically will be able to
comply with such requirements. If a producer cannot

[[Page 62469]]

meet the affidavit requirements, that producer should not attempt to
generate RINs using the amended definition of heating oil.
Similarly, the PTD requirements are necessary and tailored to be as
least restrictive as possible while ensuring compliance. If a producer
cannot meet the PTD requirements, that producer should not attempt to
generate RINs using the amended definition of heating oil. PTDs must
accompany the fuel oil from production to end use; sale contracts are
not interchangeable with PTDs but are additionally required for
recordkeeping.

RIN Generation

Comment
One commenter suggested that the heating oil definition should
identify feedstocks and applicable pathways for RIN generation.
Response
EPA's existing pathways that refer to heating oil as the final RIN-
generating renewable fuel, identified in Table 1 to 40 CFR 80.1426,
continue to apply without change. This final rule does not change those
pathways or add a new pathway. It merely adds a new category of fuel
oils that can qualify as heating oil.

Pipeline Concerns

Comment
One commenter expressed concern that the new definition will create
additional segregations of heating oil which will promote
inefficiencies in the distribution system.
Response
Based on the information we have received from renewable fuel oil
producers, the renewable fuel oil qualifying under the expanded
definition is likely to be a drop-in fuel. As such, it would not be
distributed through the pipeline system and therefore EPA does not
believe the amended definition will create any new inefficiencies for
the pipeline distribution system.

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 not a ``significant regulatory action'' and is therefore not
subject to review under Executive Orders 12866 and 13563 (76 FR 3821,
January 21, 2011).

B. Paperwork Reduction Act

The information collection requirements in this final rule have
been submitted for approval to the Office of Management and Budget
(OMB) under the Paperwork Reduction Act, 44 U.S.C. 3501 et. seq. The
information collection requirements are not enforceable until OMB
approves them.
This action contains recordkeeping and reporting requirements
(including registration and product transfer documentation) that may
affect parties who produce or import renewable fuel oils subject to the
revised definition of heating oil at 40 CFR 80.1401. EPA expects that
very few parties will be subject to additional recordkeeping and
reporting. We estimate that up to 11 parties (i.e., RIN generators,
consisting of up to 10 producers and one importer) may be subject to
the proposed information collection over the next several years.\12\ We
estimate an average annual reporting and recordkeeping burden of 31
hours and $2,205 per respondent.\13\ 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 the
instructions; develop, acquire, install, and utilize technology and
systems for the purpose 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 transit or
otherwise disclose the information. Burden is as defined at 5 CFR Sec.
1320.3(b).
---------------------------------------------------------------------------

\12\ We project that the number of affected parties will remain
essentially constant over time.
\13\ This includes the time to train staff, formulate and
transmit responses, and other miscellaneous compliance related
activities.
---------------------------------------------------------------------------

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. When this ICR is approved by
OMB, the Agency will publish a technical amendment to 40 CFR part 9 in
the Federal Register to display the OMB control number for the approved
information collection requirements contained in this final rule.

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 this action on small
entities, I certify that this action will not have a significant
economic impact on a substantial number of small entities. This final
rule will not impose any significant new requirements on small
entities.

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.
We have determined that this action will not result in expenditures of
$100 million or more for the above parties and 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. It only applies to
gasoline, diesel, and renewable fuel producers, importers, distributors
and marketers and makes relatively minor corrections and modifications
to the RFS regulations.

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

[[Page 62470]]

levels of government, as specified in Executive Order 13132. This
action only applies to gasoline, diesel, and renewable fuel producers,
importers, distributors and marketers and makes relatively minor
corrections and modifications to the RFS regulations. Thus, Executive
Order 13132 does not apply to this action.

F. Executive Order 13175 (Consultation and Coordination With Indian
Tribal Governments)

This rule does not have tribal implications, as specified in
Executive Order 13175 (65 FR 67249 (November 9, 2000)). It applies to
gasoline, diesel, and renewable fuel producers, importers, distributors
and marketers. This action makes relatively minor corrections and
modifications to the RFS regulations, and does not impose any
enforceable duties on communities of Indian tribal governments. 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 subject to Executive Order 13211 (66 FR 28355
(May 22, 2001)), because it is not a significant regulatory action
under Executive Order 12866.

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 will 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 does not
affect the level of protection provided to human health or the
environment. These amendments will not relax the control measures on
sources regulated by the RFS regulations and therefore will not cause
emissions increases from these sources.

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).

VI. Statutory Provisions and Legal Authority

Statutory authority for the rule finalized today can be found in
section 211(o) of the Clean Air Act, 42 U.S.C. 7545. Additional support
for the procedural and compliance related aspects of today's rule,
including the recordkeeping requirements, come from sections 114, 208,
and 301(a) of the Clean Air Act, 42 U.S.C. 7414, 7542, and 7601(a).

List of Subjects in 40 CFR Part 80

Environmental protection, Administrative practice and procedure,
Agriculture, Air pollution control, Confidential business information,
Diesel, Energy, Forest and Forest Products, Fuel additives, Gasoline,
Imports, Labeling, Motor vehicle pollution, Penalties, Petroleum,
Reporting and Recordkeeping requirements.

Dated: September 24, 2013.
Gina McCarthy,
Administrator.

For the reasons set forth in the preamble, 40 CFR part 80 is
amended 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, 7542, 7545, and 7601(a).

Subpart M--[Amended]

0
2. Section 80.1401 is amended by revising the definition of ``Heating
oil'' to read as follows:

Sec. 80.1401 Definitions.

* * * * *
Heating oil means:
(1) A fuel meeting the definition of heating oil set forth in Sec.
80.2(ccc); or
(2) A fuel oil that is used to heat interior spaces of homes or
buildings to control ambient climate for human comfort. The fuel oil
must be liquid at 60 degrees Fahrenheit and 1 atmosphere of pressure,
and contain no more than 2.5% mass solids.
* * * * *

0
3. Section 80.1426 is amended by adding a new paragraph (c)(7) to read
as follows:

Sec. 80.1426 How are RINs generated and assigned to batches of
renewable fuel by renewable fuel producers or importers?

* * * * *
(c) * * *
(7) For renewable fuel oil that is heating oil as defined in
paragraph (2) of the definition of heating oil in Sec. 80.1401,
renewable fuel producers and importers shall not generate RINs unless
they have received affidavits from the final end user or users of the
fuel oil as specified in Sec. 80.1451(b)(1)(ii)(T)(3).
* * * * *

[[Page 62471]]

0
4. Section 80.1450 is amended by adding a new paragraph (b)(1)(xi) to
read as follows:

Sec. 80.1450 What are the registration requirements under the RFS
program?

* * * * *
(b) * * *
(1) * * *
(xi) For a producer of fuel oil meeting paragraph (2) of the
definition of heating oil in Sec. 80.1401:
(A) An affidavit from the producer of the fuel oil stating that the
fuel oil for which RINs have been generated will be sold for the
purposes of heating interior spaces of homes or buildings to control
ambient climate for human comfort, and no other purpose.
(B) Affidavits from the final end user or users of the fuel oil
stating that the fuel oil is being used or will be used for purposes of
heating interior spaces of homes or buildings to control ambient
climate for human comfort, and no other purpose, and acknowledging that
any other use of the fuel oil would violate EPA regulations and subject
the user to civil penalties under the Clean Air Act.
* * * * *

0
5. Section 80.1451 is amended as follows:
0
a. By redesignating paragraph (b)(1)(ii)(T) as paragraph (b)(1)(ii)(U).
0
b. By adding a new paragraph (b)(1)(ii)(T).

Sec. 80.1451 What are the reporting requirements under the RFS
program?

* * * * *
(b) * * *
(1) * * *
(ii) * * *
(T) Producers of fuel oil that meets paragraph (2) of the
definition of heating oil in Sec. 80.1401, shall report, on a
quarterly basis, all the following for each volume of fuel oil:
(1) Total volume of fuel oil produced and sold, in units of U.S.
gallon, and the lower heating value of the fuel oil, in units of BTU
per U.S. gallon.
(2) Total volume of fuel oil for which RINs were generated, in
units of U.S. gallon, and the respective quantities of fuel oil sold,
organization names and locations of the buildings in which the fuel oil
was used, and the RIN numbers assigned to each batch of fuel oil.
(3) For each batch of fuel oil for which RINs are generated that
the renewable fuel producer claims meets paragraph (2) of the
definition of heating oil in Sec. 80.1401 and that is sold for the
purposes specified in paragraph (2), affidavits from end user or users
of the fuel oil that include the following information:
(i) Quantity of fuel oil received from producer.
(ii) Quantity of fuel oil used or to be used for heating interior
spaces of homes or buildings to control ambient climate for human
comfort, and for no other purpose.
(iii) Date the fuel oil was received.
(iv) Blend level of the fuel oil in petroleum based fuel oil when
received (if applicable).
(v) Quantity of assigned RINs received with the fuel oil, if
applicable.
(vi) Quantity of assigned RINs that the end user separated from the
fuel oil, if applicable.
* * * * *
0
6. Section 80.1453 is amended by adding a new paragraph (d) to read as
follows:

Sec. 80.1453 What are the product transfer document (PTD)
requirements for the RFS program?

* * * * *
(d) For fuel oil meeting paragraph (2) of the definition of heating
oil in Sec. 80.1401, the PTD of the fuel oil shall state: ``This
volume of renewable fuel oil is designated and intended to be used to
heat interior spaces of homes or buildings to control ambient climate
for human comfort. Do NOT use for process heat or any other purpose, as
these uses are prohibited pursuant to 40 CFR 80.1460(g).''.

0
7. Section 80.1454 is amended by adding a new paragraph (b)(8) to read
as follows:

Sec. 80.1454 What are the recordkeeping requirements under the RFS
program?

* * * * *
(b) * * *
(8) A producer of fuel oil meeting paragraph (2) of the definition
of heating oil in Sec. 80.1401 shall keep copies of all contracts
which describe the fuel oil under contract with each end user.
* * * * *
0
8. Section 80.1460 is amended by adding a new paragraph (g) to read as
follows:

Sec. 80.1460 What acts are prohibited under the RFS program?

* * * * *
(g) Failing to use a renewable fuel oil for its intended use. No
person shall use fuel oil that meets paragraph (2) of the definition of
heating oil in Sec. 80.1401 and for which RINs have been generated in
an application other than to heat interior spaces of homes or buildings
to control ambient climate for human comfort.

[FR Doc. 2013-24280 Filed 10-21-13; 8:45 am]
BILLING CODE 6560-50-P