0 CDA EPA420-F-95-027
October 31, 1995
RFG/Anti-Dumping
Questions and Answers
October 31,1995
Fuels and Energy Division
Office of Mobile Sources
U.S. Environmental Protection Agency
-------
RFG/ANTI-DUMPING QUESTIONS AND ANSWERS, OCTOBER 31,1995
The following are responses to most of the questions received by the Environmental
Protection Agency (EPA) through October 3, 1995, concerning the manner in which the EPA
intends to implement and assure compliance with the reformulated gasoline and anti-dumping
regulations at 40 CFR Part 80. This document was prepared by EPA's Office of Air and
Radiation, Office of Mobile Sources, and Office of Enforcement and Compliance Assurance,
Office of Regulatory Enforcement, Air Enforcement Division.
Regulated parties may use this document to aid in achieving compliance with the
reformulated gasoline (RFG) and anti-dumping regulations. However, this document does not in
any way alter the requirements of these regulations. While the answers provided in this
document represent the Agency's interpretation and general plans for implementation of the
regulations at this time, some of the responses may change as additional information becomes
available or as the Agency further considers certain issues.
This guidance document does not establish or change legal rights or obligations. It does not
establish binding rules or requirements and is not fully determinative of the issues addressed.
Agency decisions in any particular case will be made applying the law and regulations on the
basis of specific facts and actual action.
While we have attempted to include answers to all questions received by October 3, 1995, the
necessity for policy decisions and/or resource constraints may have prevented the inclusion of
certain questions. Questions not answered in this document will be answered in a subsequent
document. Questions that merely require a justification of the regulations, or that have
previously been answered or discussed either in a previous Question and Answer document or
the Preamble to the regulations have been omitted.
Topics Covered
Sampling and Testing
California Enforcement Exemptions
Importer Issues
Prohibitions
October 31, 1995
-------
SAMPLING AND TESTING
[Note: The following is an update of Question 3, Sampling and Testing Procedures Section,
from the July 1,1994 Question and Answer document. This update eliminates the
requirement that parties must petition to collect samples from storage tank taps that do not
have "stingers."]
3. Question: Appendix D of the fuels regulations specifies that only taps extending at least 3
feet inside a tank are suitable for sampling. Is this requirement applicable for gasoline sampling?
Is it necessary to secure EPA's acceptance before collecting samples from taps without such
"stingers?"
Answer: Section 11.3 of Appendix D to 40 CFR Part 80, titled "Tap Sampling," states
that where tap sampling is conducted, "[t]he tank should be equipped with at least three sampling
taps... extending at least three feet inside the tank shell." The tap extension into the storage tank
is commonly called a "stinger." Section 11.1 of Appendix D provides for the use of alternative
procedures (such as sampling from taps without "stingers"), however, "if a mutually satisfactory
agreement has been reached by the party involved and EPA and such agreement has been put in
writing and signed by authorized officials."
EPA has learned that where storage tanks with floating roofs have tap samples, the taps
do not have tap "stingers" because they would interfere with the floating roof. EPA also
understands that most gasoline storage tanks have floating roofs. Moreover, EPA believes that
tap "stingers" do not significantly improve the quality of samples collected, because most
gasoline stratification manifests as horizontal strata in the gasoline being stored. As a result,
EPA will not require parties to obtain agreement in advance to use sampling taps without
"stingers," provided
that the storage tank has a floating roof that would interfere with the tap "stingers," and the tank
does not allow other types of sampling (e.g., a gauge tube). In addition, any party that certifies
RFG or conventional gasoline using samples collected from a tap sampler must be able to
demonstrate the gasoline in the storage tank was homogeneous. Several methods of establishing
tank homogeneity have been described in other guidance. See, Sampling and Testing question 1
from the January 23, 1995 Question and Answer document.
1. Question: If a refiner used ASTM D-3120 to determine sulfur levels in 1990, its baseline
sulfur value could be as low as 3 ppm, since this is the low end of the valid range for this test
method. However, this refiner must use the EPA-specified test method for sulfur, ASTM D-
2622, for compliance purposes beginning in 1995. Since D-2622 is only valid down to 10 ppm,
this refiner could never meet the Simple Model caps for sulfur. What options does this refiner
have?
October 31, 1995
-------
Answer: Section 80.91(d)(5) specifies that in certain situations data from test methods
other than those specified in § 80.46 may be used to establish refinery baselines. Regardless of
the method used, however, for test results that are below the lower valid range limit for the
analysis method used the lower valid range limit for the method may be used for establishing a
baseline under § 80.91.
For purposes of compliance calculations, a refiner who measures a parameter at below the
lower valid range limit for the analysis method also would use the lower valid range limit in its
baseline determinations. One exception to this general rule applies in the case of a refiner who
used a parameter test method for baseline development that is different from the regulatory test
methods specified under § 80.46 for that parameter, and where the baseline test method had a
lower valid range limit that is more stringent than the lower valid range limit for the regulatory
test method. In this limited exception, during each compliance period a refiner who measures a
parameter value at below the valid range for the regulatory test method may use a value of zero in
compliance calculations.
This limited exception is illustrated with the following example. A refiner collected
sulfur content data for purposes established a refinery baseline using ASTM method D-3120,
which has a lower valid range limit of 3 ppm. This refiner could use a sulfur value of 3 ppm for
any test result that is less than 3 ppm in the baseline calculations. For purposes of determining
compliance with the RFG and anti-dumping standards, however, this same refiner is required
under § 80.46(a) to measure the sulfur content of gasoline using ASTM method D-2622, which
has a lower valid range limit of 10 ppm. Because the lower valid range limit for the baseline
sulfur test method used by this refiner (3 ppm) is more stringent than the lower valid range limit
for the regulatory sulfur test method (10 ppm), the refiner could use a sulfur value of zero for any
compliance test result that is less than 10 ppm.
CALIFORNIA ENFORCEMENT EXEMPTIONS
1. Question: The California Exemption of § 80.81 requires that CARB n producers
demonstrate compliance for the offset period (March 1, 1995 through February 28, 1996). May
such a refiner shift from the Simple Model to the Early Use Complex Model beginning January
1, 1996? If so, how would the compliance calculations be performed?
Answer: Under § 80.41(1) a refiner may elect, for each calendar year averaging period, to
be subject to either the simple model standards or the early complex model standards for the
RFG produced, subject to certain conditions and constraints contained in §§ 80.41(1) and (j). In
addition, under § 80.78(a)(9)(ii) and (iii) RFG and RBOB produced at a refinery or imported by
an importer to meet the early complex model standards must be segregated from all other RFG
and RBOB throughout the distribution system, including at the retail level. In effect, this
segregation constraint makes early use of the complex model for RFG impractical in most
situations.
October 31, 1995
-------
Under § 80.81(b)(3), producers of "California gasoline," defined in § 80.81(a)(2), who
meet standards on average are required to demonstrate compliance for two overlapping averaging
periods: January 1, 1995 through December 31, 1995; and March 1, 1995 through February 29,
1996. Beginning March 1, 1996, when the CARB Phase II standards go into effect, certain
enforcement exemptions apply to producers of California gasoline.
EPA will allow a producer of California gasoline who is subject to the overlapping
averaging periods of § 80.81(b)(3) to elect to be subject to the early complex model standards for
the second period (March 1, 1995 through February 29, 1996) even if this producer is subject to
the simple model standards for the first period (January 1, 1995 through December 31, 1995). If
this election is made, the gasoline produced during the entire second averaging period would be
evaluated under the early complex model, however, only the RFG and RBOB produced by this
refiner during the period January 1, 1996 through February 29, 1996, would be subject to the
segregation constraints of § 80.78(a)(9).
IMPORTER ISSUES
[Note: The following is an update to Question 8 of Section IX-C of the July 1,1995
Question and Answer Document, which was updated on August 29,1994. This update
adds an additional option for sampling and testing vessels of imported RFG.]
IX-C-8 Question: At what point in the import process must shipments of imported gasoline be
sampled in order to meet the RFG and anti-dumping requirements?
Answer: Section 80.65(e)(l) requires importers to determine the properties applicable to
the RFG standards for each batch of imported gasoline designated as RFG prior to the gasoline
leaving the import facility, by analyzing a representative sample from the batch using the test
methods specified in § 80.46. Section 80.101(I)(1) similarly requires an importer to determine
the properties applicable to the anti-dumping standards for each batch of imported conventional
gasoline by analyzing a sample using the § 80.46 test methods. In the case of conventional
gasoline, under § 80.101(I)(2) the samples from more than one batch of conventional gasoline
may be combined into a composite sample and analyzed together, following procedures specified
in that section.
These sections thus require that a sample of each batch of imported gasoline must be
collected before the batch is combined with any other gasoline or blendstock that is not a part of
that imported batch. As a result, in order to meet the requirements, any batch of imported
gasoline must be sampled before the batch is off-loaded from a ship into a shore tank if that shore
tank contains any amount of any product. This is because a sample from such a shore tank would
be a mixture of imported gasoline and the other product, and would therefore not be
representative of the gasoline that being imported. For these reasons, a sample of each batch of
October 31, 1995
-------
imported gasoline must be collected before the ship is off-loaded at the port of entry. In the case
of imported RFG, the independent lab and the importer (if the importer is using the 10%
independent analysis option) must collect a sample of the imported gasoline, and it must be
determined that the measurements are consistent with certifiable RFG, before the ship is off-
loaded.
The different ship compartments normally must be considered different batches of
gasoline, because the gasoline may not be homogeneous across multiple compartments. In the
case of imported conventional gasoline, composite samples from multiple batches are allowed, so
a volume-weighted composite from the gasoline in different compartments of a ship may be
analyzed for anti-dumping compliance purposes. The volume of a batch of imported
conventional gasoline must be the off-loaded volume, however, and normally would be
established by the importer based on shore tank measurements.
In the case of RFG, the importer and independent lab may treat the gasoline in different
compartments of a ship as a single batch only if the importer or lab has a strong basis to believe
that the gasoline is homogeneous across the compartments, but such a determination would
require analysis of the different compartment samples for most of the RFG parameters. The
minimum set of parameters that may be used to establish homogeneity are the following: API
Gravity, sulfur, benzene, E200, and E300. Only if the different compartments of a ship have the
same values for each of these parameters, within the ASTM repeatability range for each
parameter, may the gasoline in different ship compartments be considered to be homogeneous.
In the alternative, EPA will accept the analysis of samples collected from different ship
compartments that are combined into a single volume-weighted composite sample, provided the
compartments are off-loaded into a single shore tank. EPA believes such a composite sample
would be representative of the overall quality of the gasoline in the multiple ship compartments,
following the mixing of this gasoline in the shore tank. If the gasoline is not completely
homogeneous when in the different ship compartments, presumably the gasoline will be mixed to
the point of homogeneity in the shore tank.
As a second alternative, EPA will accept the analysis of samples collected from different
ship compartments that are combined into a single volume-weighted composite sample, provided
that each shore tank into which the imported RFG is off-loaded is also sampled and tested to
establish that the imported RFG meets the downstream standards without the application of any
enforcement tolerances.1 Under this approach, any RFG contained in the shore tank before the
imported RFG is added (the tank "bottom") must be sampled and tested for the downstream
standards using the § 80.46 test methods. After the imported RFG is added to the tank, the entire
1 The RFG downstream standards are the per-gallon maximums or minimums associated with
the following average standards: under the simple model, oxygen and benzene, and RVP in the
case of VOC-controlled RFG; under the complex model, oxygen, benzene, and NOx emissions
performance, and VOC emissions performance in the case of VOC-controlled RFG.
October 31, 1995
-------
tank again must be sampled and tested for the downstream standards using the § 80.46 test
methods. The volume and properties of the tank bottom must then be subtracted from the post-
addition test results, to mathematically determine the levels for the downstream standard
parameters for the imported RFG. Only if these shore tank test results are within the
downstream standards without the application of any enforcement tolerance may the ship
composite sample be used to certify the imported RFG.
As a third alternative, EPA will accept the analysis of samples collected from different
ship compartments that are combined into a single volume-weighted composite sample, provided
that each individual vessel compartment is shown, through sampling and testing, to meet all
applicable downstream standards without the application of any enforcement tolerance.
The rationale for the second and third alternatives to treating each ship compartment as a
separate batch is that these procedures will ensure that even if the gasoline on the ship is not
homogeneous, none of the gasoline violates the minimum and maximum standards.
Under either of these alternative approaches, a composite sample would be inappropriate
to establish the RVP of imported RFG, because the process of preparing a composite sample
renders any RVP result suspect. The importer and independent lab could, however, test a ship
composite sample (if allowed as discussed above) for all properties other than RVP, and only
separately analyze the compartment samples for RVP. The RVP of the multiple-compartment
batch could then be derived mathematically from the separate RVP analyses for each
compartment. As in the case of conventional gasoline, the volume of imported RFG must be the
off-loaded volume, and normally would be established by the independent lab based on shore
tank measurements.
Any imported RFG that is sampled and tested using the composite approaches discussed
above would be considered a single batch for purposes of assigning batch numbers and reporting
to EPA.
The approaches for testing imported RFG involving composite samples from multiple
ship compartments, as discussed above, would not be appropriate if the importer or independent
lab has any reason to believe the gasoline will not be homogeneous when released from the
import facility.
1. Question: U.S. Customs regulations allow duty free entry for certain products produced in
the United States that are exported from one U.S. port and imported at another U.S. port. These
products are classified under U.S. Customs regulations as American Goods Returning to the U.S.
This approach has been used, for example, in the case of certain gasoline and distillate products
that are produced at U.S. refineries located on the Gulf coast and transported by ship to
terminals located in Canada, and where the product then is transported by truck to markets in the
United States. What standards and requirements apply to imported gasoline in the case of
October 31, 1995
-------
gasoline that is classified by the U.S. Customs Service as American Goods Returning to the
U.S.?
Answer: 40 CFR §§ 80.65 and 80.101 require importers of RFG or conventional
gasoline to meet applicable standards, and to meet other requirements including sampling,
testing, record keeping, and reporting. EPA considers gasoline to be imported for purposes of
the RFG and anti-dumping programs if it consists, in whole or in part, of gasoline produced at
refineries located outside the United States and imported into the United States. As a result, EPA
does not consider gasoline to be imported for purposes of the RFG and anti-dumping programs
where the gasoline has been classified as American Goods Returned to the U.S. by the U.S.
Customs Service, provided that the gasoline was produced at a refinery located within the United
States and has not been mixed with gasoline produced at a refinery located outside the U.S. This
gasoline must be included in the RFG or anti-dumping compliance calculations by the producing
refiner, using that refiner's individual baseline where applicable. In addition, because the
gasoline has been included in the producing refiner s compliance calculations, all of the gasoline
that was exported must ultimately be classified as American Goods Returned to the U.S. and
none may be used in a foreign country. Moreover, the gasoline classified as American Goods
Returned to the U.S. may not be combined with any gasoline produced at a foreign refinery prior
to being imported into the United States.
Thus, under the example described in the question - of gasoline produced at a U.S.
refinery located on the Gulf coast and transported to markets in the U.S. via a terminal in Canada
— the Canadian terminal would need dedicated tankage for gasoline classified as American
Goods Returned to the U.S. in order for the U.S. importer to avoid treating the gasoline as
imported gasoline for the RFG or anti-dumping programs. Gasoline from these tanks could
supply only U.S. markets, and the gasoline classified as American Goods Returned to the U.S.
could not be fungibly mixed at the Canadian terminal with any gasoline produced at a non-U.S.
refinery. In addition, none of the gasoline that was produced at the U.S. refinery and included in
the refinery s compliance calculations could be used in Canadian markets.
Any refiner who includes in refinery compliance calculations gasoline that has been
exported because the gasoline will be classified as American Goods Returned to the U.S., or
any importer who excludes from the importer standards and requirements gasoline that has been
so classified, should retain copies of all documents submitted to, or issued by, the U.S. Customs
Service regarding this classification of the gasoline.
PROHIBITIONS
1. Question: Under section 80.78(a)(9), early use of complex model gasoline is limited by the
requirement that all such gasoline be segregated throughout the distribution system from the
point of production to the point of final sale or use. Because this restriction severely limits the
October 31, 1995
-------
fungibility of the product, in most situations, early use complex model gasoline is not
economically viable. However, if an RFG manufacturer were to produce early use complex
model gasoline meeting all of the early use complex model requirements, and also meet all the
simple model requirements applicable to refinery compliance, other than the requirements for
sulfur, olefins and T90, would it still be necessary to segregate early use complex model
gasoline?
Answer: This requirement for segregation of early use complex model gasoline
throughout the system is based upon concerns regarding enforcement of standards downstream,
e.g., at retail stations, and the effect complex model gasoline would have on the compliance
survey. If complex model and simple model gasoline were freely mixed, downstream
enforcement would be severely complicated since commingled complying gasolines might not
meet all of the standards that are enforced downstream. Furthermore, it would not be apparent
against which standards such gasoline should be judged for compliance. Similarly, with the
compliance survey, it is required that a complex model survey component and a simple model
survey component be performed.2 If simple and complex model gasolines were commingled,
survey results could not be appropriately judged against either complex or simple model
standards. Both the enforcement concerns and the compliance survey concerns relate to the
possibility that complex model gasoline may not meet the downstream simple model standards
specified in 80.41 (a), and (b). However, if the early use complex model gasoline were
formulated to also meet all of the simple model standards except those for olefins, T90 and
sulfur, this would have no impact either on downstream enforcement or on the compliance
survey which is conducted downstream at retail stations. Furthermore, if such gasoline met all
early use complex model requirements it would be at least as environmentally clean, and possibly
cleaner than, comparable simple model gasoline. Therefore, early use complex model RFG
gasoline need not be segregated from simple model gasoline if such gasoline also meets all
simple model requirements other than those for olefins, T90 and sulfur. The presence of such
gasoline in the marketplace will not in itself constitute a need for a complex model survey
component since it will meet the downstream standards for the simple model and may be
included in the simple model survey component. This gasoline should be reported as complex
model gasoline under the RFG reporting requirements. The regulations require that parties
intending to produce early use complex model gasoline notify EPA by November 2 of the
previous year. However, for 1995 production, the reporting party could not have notified the
Agency that early use complex model gasoline would be utilized under the scenario outlined
here. Thus, for 1995 production, parties may utilize the flexibility offered here even if they have
not met this notification requirement. However, previously submitted required batch reports
must be resubmitted with the appropriate designation. Because this document is being posted on
EPA's bulletin board such a short time prior to the November 2, 1995 deadline for notification
2 Since no refiners have notified the Agency as required that they intend to utilize the
allowance for early use complex model gasoline, up to this point, the Agency is considering the
approval of survey plans which do not include a complex model survey component. Such a plan
was approved in 1994 for 1 995.
October 31, 1995
-------
For 1996 production, EPA is extending the notification for early complex model use, under the
scenario outlined here only, to December 1, 1995. A party producing gasoline under this
scenario, must comply with all the product transfer documentation (PTD) requirements including
80.77(g)(2)(iii) but excluding 80.77(g)(l)(iii), 80.77(g)(2)(iv), and 80.77(h) on the condition that
the PTD indicate that this gasoline is certified under the reformulated gasoline regulations and
may be treated like any simple model gasoline subject to the same designations.
October 31, 1995
------- |