Control of Hazardous Air Pollutants
from Mobile Sources
Summary and Analysis of Comments
United States
Environmental Protection
Agency
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Control of Hazardous Air Pollutants
from Mobile Sources
Summary and Analysis of Comments
Assessment and Standards Division
Office of Transportation and Air Quality
U.S. Environmental Protection Agency
v>EPA
United States EPA420-R-07-003
Environmental Protection February 2007
Agency
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TABLE OF CONTENTS
1. General Position Statements 2-1
1.1 Supports Rule 2-1
1.2 Opposes Rule 2-2
2. Environmental/Air Quality and Public Health Impacts 2-1
2.1 Public Health Issues 2-1
2.2 National-Scale Modeling 2-26
2.3 Near-Road, Attached Garages, and Other Microenvironmental Exposure....2-28
2.4 Emission Reductions 2-32
References 2-34
3. New Light-Duty Vehicle Standards 3-1
3.1 Cold Temperature Requirements 3-1
3.1.2 Tailpipe Standards over All Cycles 3-9
3.1.2.1 PM-specific Standards 3-11
3.1.2.2 Standards Do Not Account For Testing Requirements in Fuel Economy
Label Standard 3-12
3.1.3 Harmonizing with California LEV II Standards 3-13
3.1.4 Timing and Phase-in 3-16
3.1.5 Credits 3-20
3.2 Evaporative Emissions Standards 3-28
4. Gasoline Benzene Program 4-1
4.1 Standards 4-1
4.2 Implementation Issues 4-19
4.3 Lead Time for Compliance 4-26
4.4 Costs 4-28
4.5 Refinery Modeling 4-32
4.6 Refinery-Specific Impacts 4-34
4.7 Averaging, Banking, and Trading (ABT) Program 4-38
4.8 Effects on Fuel and/or Energy Supply, Distribution, and Use 4-51
4.9 Small Refiner and Other Hardship Provisions 4-59
4.10 Western Refiner Issues 4-72
5. Portable Fuel Containers 5-1
5.1 Standards 5-1
5.2 Timing 5-3
5.3 Certification and Test Procedures 5-4
5.4 Spout Requirements/Spillage Control 5-6
in
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5.5 Emission Reduction Estimates 5-10
5.6 Other 5-10
6. Cost-Benefit Analysis 6-1
6.1 Predicted Health Benefits of the Rule 6-1
6.2 Predicted Social Costs of the Rule 6-14
7. Administrative and Procedural Requirements 7-2
7.1 SBREFA Process/Regulatory Flexibility Act 7-2
7.2 Clean Air Act Requirements 7-2
8. Other/Miscellaneous Comments 8-1
8.1 Public Comment Period 8-1
8.2 Comments Outside the Scope of the Proposal 8-2
8.3 Other Comments 8-5
9. References 9-2
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INDEX OF MSAT PROPOSAL COMMENTERS
Commenter
Alaska Department Of Environmental
Conservation
Alliance of Automobile Manufacturers
American Chemistry Council Olefins
Panel
American Lung Association1
American Petroleum Institute2
API & NPRA
(Municipality of) Anchorage Department
of Health and Human Services
Association of International Automobile
Manufacturers
Association of Local Air Pollution Control
Officials4
BP
Caribbean Petroleum
Chevron Corporation
Colonial Oil Industries, Inc.
Countrymark Cooperative, LLP
DSD International Inc.
Energy Future Coalition
Engine Manufacturers Association
Environmental Defense1
ExxonMobil
Flint Hills Resources, LP
Florida Department of Environmental
Protection
Flying J Inc
Giant Industries, Inc.
Gladieux Trading & Marketing Co., L.P.
Hess Corporation
Illinois Environmental Protection Agency
Independent Fuel Terminal Operators
Association
International Institute of Synthetic Rubber
Producers
International Truck and Engine
Corporation
Lane Regional Air Protection Agency
Lotus Engineering
Manufacturers of Emission Controls
Association
Marathon Petroleum Company, LLC
Abbreviation
ADEC
The Alliance
ALA
API
Anchorage
AIAM
ALAPCO
BP
—
Chevron
Colonial
Countrymark
DSD
EFC
EMA
ED
XOM
FHR
FLDEP
Flying J
Giant
Gladieux
Hess
ILEPA
IFTOA
IISRP
International
LRAPA
MECA
MFC
Docket ID Number
OAR-2005-0036-0975
OAR-2005-0036-0881
OAR-2005-0036-0823
OAR-2005-0036-0868, -0365
OAR-2005-0036-0366, -0367, -
0884
OAR-2005-0036-1015
OAR-2005-0036-0976
OAR-2005-0036-0973
OAR-2005-0036-0836, -0378
OAR-2005-0036-0824, 0837
OAR-2005-0036-1010
OAR-2005-0036-0847
OAR-2005-0036-0990
OAR-2005-0036-0471
OAR-2005-0036-0377, -0
OAR-2005-0036-0840
OAR-2005-0036-0810
OAR-2005-0036-0868
OAR-2005-0036-0772, -1013
OAR-2005-0036-0862
OAR-2005-0036-0770
OAR-2005-0036-0989, -1011
OAR-2005-0036-0831, -0883
OAR-2005-0036-0972
OAR-2005-0036-0769
OAR-2005-0036-0830
OAR-2005-0036-1007
OAR-2005-0036-0807
OAR-2005-0036-0826
OAR-2005-0036-0848
OAR-2005-0036-1033
OAR-2005-0036-0808
OAR-2005-0036-0946, -1008
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Mitsubishi Motors
Mothers and Others for Clean Air
National Petrochemical Refiners
Association2
Natural Resources Defense Council1
New Jersey Department of Environmental
Protection
New York State Department of
Environmental Conservation
Nissan
Northeast States for Coordinated Air Use
Management
Oregon Toxics Alliance
Oregon Department of Environmental
Quality
Portable Fuel Container Manufacturers
Association
Puget Sound Clean Air Agency
Regional Air Pollution Control Agency
Sensors, Inc.
Silver Eagle Refining
Sinclair Oil Corporation3
Small Business Refiners' Ad-Hoc
Coalition
State and Territorial Air Pollution Program
Administrators4
Sunoco, Inc.
Suncor Energy (U.S. A) Inc.3
Tesoro Corporation3
TEIR Associates, Inc
Toyota Technical Center
U.S. Oil & Refining, Co.
U.S. PIRG1
U.S. Senators (Wyden et al; Enzi et al)
United Refining Company
Vermont Air Pollution Control Division
Washington State Department of Ecology
Wisconsin Department of Natural
Resources
Mitsubishi
Mothers/Others
NPRA
NRDC
NJDEP
NY DEC
—
NESCAUM
OTA
ODEQ
PFCMA
Puget Sound
RAPCA
SEMTECH
Silver Eagle
Sinclair
Small Refiners
STAPPA
Sunoco
Suncor
Tesoro
Teir
Toyota
USOR
PIRG
United
Vermont
WADE
WDNR
OAR-2005-0036-0882
OAR-2005-0036-0991
OAR-2005-0036-0809
OAR-2005-0036-0868
OAR-2005-0036-0829
OAR-2005-0036-0722
OAR-2005-0036-0825
OAR-2005-0036-0993, -0369
OAR-2005-0036-0948
OAR-2005-003 6-0987
OAR-2005-0036-0819, -0365
OAR-2005-0036-0780
OAR-2005-0036-0771
OAR-2005-0036-0958
OAR-2005-0036-0839
OAR-2005-0036-0989, -1011
OAR-2005-0036-0686
OAR-2005-0036-0836, -0378
OAR-2005-0036-0806
OAR-2005-0036-0989, -1011
OAR-2005-0036-0989, -1011
OAR-2005-0036-0838, 1012
OAR-2005-0036-0773
OAR-2005-0036-0992
OAR-2005-0036-0868
OAR-2005-0036-0827
OAR-2005-0036-0444
OAR-2005-0036-0950
OAR-2005-0036-0828
7- ALA, ED, NRDC, PIRG commented together
2- API andNPRA commented together
3- Flying J, Sinclair, Suncor, and Tesoro commented together (refiners in the Rocky Mountain and
Pacific Northwest regions (PADDs 4 and 5, respectively))
4- STAPPA & ALAPCO commented together
VI
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LIST OF ACRONYMS
ABT
AECD
ALVW
ANLL
AML
AOD
ASPEN
ASTM
ATPZEV
ATV
bpcd
BTEX
BWC
CAA
CAFE
CAIR
CAMx
CARB
CASAC
CBA
CCD
CD
CG
CUT
CLL
CM
CMAQ
CNLL
CO
CRC
CRF
Cr(VI)
DF
DIS
DoE, DOE
DRIA
E&C
EIA
EIA
EIM
EO
EPAct
ETBE
EU
EVOH
FACES
FCC
Averaging, Banking, and Trading
Auxiliary Emission Control Device
Adjusted Loaded Vehicle Weight
Acute Nonlymphocytic Leukemia
Acute Myelogenous Leukemia
Airway Obstructive Disease
Assessment System for Population Exposure Nationwide
American Society for Testing and Materials
Advanced Technology Partial Zero Emission Vehicle
All-Terrain Vehicle
Barrels per Calendar Day
Benzene, Toluene, Ethylbenzene, and Xylene isomers
Best Workplaces for Commuters
Clean Air Act
Corporate Average Fuel Economy
Clean Air Interstate Rule
Comprehensive Air Quality Model with Extensions
California Air Resources Board
Clean Air Science Advisory Committee
Cost Benefit Analysis
Combustion Chamber Deposits
Criteria Document
Conventional Gasoline
Chemical Industry Institute of Technology
Chronic Lymphocytic Leukemia
Complex Model
Community Multi-scale Air Quality
Chronic Nonlymphocytic Leukemia
Carbon Monoxide
Coordinating Research Council
Concentration-Response Functions
Hexavalent Chromium
Deterioration Factor
Document Index System
U.S. Department of Energy
Draft Regulatory Impact Analysis
Engineering and Construction
Energy Information Administration
Economic Impact Analysis
Economic Impact Model
Executive Order
Energy Policy Act
Ethyl Tertiary Butyl Ether
European Union
Ethylene Vinyl Alcohol
Fresno Asthmatic Children's Environment Study
Fluidized Catalytic Cracking
Vll
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FE
PEL
FEV
FFV
FR
FTP
FUL
FY
GVWR
HAD
HAP
HAPEM
HC
HOPE
HDV
HEI
HI
HLDTs
HQ
IARC
ICIs
IM, I/M
IRIS
IVD
LDGTs
LDGVs
LDTs
LDVs
LEV
LLDT
LP
LVW
MATES-II
MDPVs
MFV
MLE
MRADs
MSATs
MTBE
MY
NAAQS
NAS
NATA
NCER
NCI
NCI-CAPM
NEI
NERL
NESHAP
Fuel Economy
Family Emissions Limit
Forced Expiratory Volume
Flex-Fuel Vehicle
Federal Register
Federal Test Procedure
Full Useful Life
Fiscal Year
Gross Vehicle Weight Rating
Health Assessment Document
Hazardous Air Pollutant
Hazardous Air Pollutant Exposure Model
Hydrocarbon
High Density Polyethylene
Heavy-duty Vehicle
Health Effects Institute
Hazard Index
Heavy Light-duty Trucks
Hazard Quotient
International Agency for Research on Cancer
Independent Commercial Importers
Inspection and Maintenance
Integrated Risk Information System
Intake Valve Deposits
Light-duty Gasoline Trucks
Light-duty Gasoline Vehicles
Light-duty Trucks
Light-duty Vehicles
Low Emission Vehicle
Light Light-duty Trucks
Linear Programming
Loaded Vehicle Weight
Multiple Air Toxics Exposure Study
Medium-duty Passenger Vehicles
Multi-Fueled Vehicle
Maximum Likelihood Estimate
Minor Restricted Activity Days
Mobile Source Air Toxics
Methyl Tertiary Butyl Ether
Model Year
National Ambient Air Quality Standard
National Academy of Sciences
National Air Toxics Assessment
National Center for Environmental Research
National Cancer Institute
National Cancer Institute and Chinese Academy of Preventative Medicine
National Emissions Inventory
National Exposure Research Laboratory
National Emissions Standards for Hazardous Air Pollutants
Vlll
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NHEERL
NHL
NIOSH
NLEV
NMHC
NMIM
NMMAPS
NMOG
NOx
NPRM
NRC
NRMRL
OBD
OMB
OTAQ
PADD
PAHs
PAMS
PFC
PFID
PM
PM10
PM25
PoD
POM
ppbv
ppm
ppmv
PZEV
RADs
RBOB
REL
RfC
RfDs
RFG
RFS
RIA
RIOPA
RRADs
RVP
SAB
SAB-HES
SBAR Panel
SBREFA
SERs
SFTP
SHED
SI
SLAMS
National Health and Environmental Effects Research Laboratory
Non-Hodgkin's Lymphoma
National Institute for Occupational Safety and Health
National Low Emission Vehicle
Non-methane Hydrocarbon
National Mobile Inventory Model
National Morbidity, Mortality, and Air Pollution Study
Non-methane Organic Gas
Oxides of Nitrogen
Notice of Proposed Rulemaking
National Research Council
National Risk Management Research Laboratory
On-board Diagnostics
Office of Management and Budget
Office of Transportation and Air Quality
Petroleum Administration Districts for Defense
Polycyclic Aromatic Hydrocarbons
Photochemical Assessment Monitoring Stations
Portable Fuel Container
Port Fuel Injectors
Particulate Matter
Particulate Matter 10 microns in diameter or less
Particulate Matter 2.5 microns in diameter or less
Point of Departure
Polycyclic Organic Matter
Parts Per Billion by Volume
Parts per Million
Parts per Million by Volume
Partial Zero Emission Vehicle
Restricted Activity Days
Reformulated Blendstock for Oxygenate Blending
Reference Exposure Level
Reference Concentration
Reference Doses
Reformulated Gasoline
Renewable Fuels Standard
Regulatory Impact Analysis
Relationship among Indoor, Outdoor, and Personal Air
Respiratory-related Restricted Activity Days
Reid Vapor Pressure
Science Advisory Board
Science Advisory Board's Health Effects Subcommittee
Small Business Advocacy Review Panel (or, 'The Panel')
Small Business Regulatory Enforcement Fairness Act
Small Entity Representatives
Supplemental Federal Test Procedures
Sealed Housing for Evaporative Determination
Spark Ignition
State and Local Air Monitoring Stations
IX
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SO2
SOA
SULEV
SVMs
SwRI
TAME
TEACH
THC
TLEV
TSP
ULEV
ULSD
URF
VMT
VOC
VSL
ZEV
Sulfur Dioxide
Secondary Organic Aerosol
Super Ultra Low Emission Vehicle
Small Volume Manufacturers
Southwest Research Institute
Tertiary Amyl Methyl Ether
Toxic Exposure Assessment - Columbia/Harvard
Total Hydrocarbon
Transitional Low Emission Vehicle
Total Suspended Particulates
Ultra Low Emission Vehicle
Ultra-low Sulfur Diesel
Unit Risk Factor
Vehicle Miles Traveled
Volatile Organic Compounds
Value of a Statistical Life
Zero-Emission Vehicle
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1. GENERAL POSITION STATEMENTS
What We Proposed:
The following comments relate in general to the Notice of Proposed Rulemaking
(NPRM). The comments in this section are not on any specific aspect of the proposed rule;
rather, they are directed to the general substance of the proposal. More detailed proposal items,
and their corresponding comments, can be found in later sections of this Summary and Analysis
of Comments.
For more information on the proposed rule, see 71 FR 15804 (March 29, 2006): [link to:
http://www. epa.gov/otaq/regs/toxics/msat-nprm-fr.pdf\ •
1.1 Supports Rule
What Commenters Said:
A number of commenters expressed general support for the proposed rule. These
commenters cited the air quality and health benefits that would result from its implementation
and some described the air quality problems they have experienced personally and in their own
communities. Some commenters also noted that they believed that the approach of addressing
both the vehicles and the fuel as a "system" was necessary to achieve the greatest emission
reductions. In addition, some commenters stated that they were in support of a more streamlined
fuel benzene standard. As noted below in section 1.2, some commenters believed that the rule
either went too far or did not go far enough. However, commenters in general stated that they
support the reduction of benzene emissions.
Letters:
Alliance of Automobile Manufacturers (Alliance) OAR-2005-0036-0881, 0379 (hearing)
American Lung Association OAR-2005-0036-0365 (hearing)
American Lung Association OAR-2005-0036-0868
American Petroleum Institute (API) OAR-2005-0036-0336 (hearing testimony), -0884,
DSD International Inc. OAR-2005-0036-0377, -0383
Engine Manufacturers Association (EMA) OAR-2005-0036-0810
Environmental Defense OAR-2005-0036-0868
Independent Fuel Terminal Operators Association OAR-2005-0036-1007
Lane Regional Air Protection Agency (LRAPA) OAR-2005-0036-0848, -0974
Manufacturers of Emission Controls Association (MECA) OAR-2005-0036-0808
Natural Resources Defense Council OAR-2005-0036-0868
Northeast States for Coordinated Air Use Management (NESCAUM) OAR-2005-0036-
0369 (hearing testimony), -0993
Oregon Toxics Alliance OAR-2005-0036-0948
Portable Fuel Container Manufacturers Association (PFCMA) OAR-2005-0036-0819
Private Citizens
STAPPA/ALAPCO OAR-2005-0036-0378 (hearing testimony), -0836
2-1
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Sunoco OAR-2005-0036-0806
Toyota Technical Center OAR-2005-0036-0773
U.S. PIRG OAR-2005-0036-0868
Our Response:
We appreciate the comments that these commenters provided. With the MSAT2 rule, we
are finalizing standards for passenger vehicles, gasoline, and portable fuel containers (such as
gas cans). These standards will significantly reduce emissions of many air toxics, such as:
hydrocarbons, including benzene, 1,3-butadiene, formaldehyde, acetaldehyde, acrolein, and
naphthalene. The fuel benzene standard and hydrocarbon standards for vehicles and portable
fuel containers will together reduce total emissions of air toxics by 330,000 tons in 2030,
including 61,000 tons of benzene. Mobile sources were responsible for 68% of benzene
emissions in 1999. As a result of this final rule, in 2030 passenger vehicles will emit nearly 45%
less benzene, portable fuel containers will emit 45% less benzene, and gasoline will have 38%
less benzene overall. We believe that significant air quality and health benefits will result from
implementation of the MSAT2 rule.
1.2 Opposes Rule
What Commenters Said:
Rule is too stringent
In general, commenters stated that they believed that the proposed stringency was
adequate or was not stringent enough.
However, some refiners (namely those that will likely be considered small refiners, and
those in the Western U.S.) commented that they believe that the proposed rule is too stringent.
We also received many comments from those in the refining industry who commented that the
rule does not provide enough lead time for compliance with the program requirements.
We also received comments from some vehicle manufacturers which stated that the
proposed requirements for vehicles will be challenging.
Rule is too costly
As stated below in the specific chapters regarding the vehicle and gasoline benzene
control (Chapters 3 and 4, respectively), some of the potentially regulated entities commented
negatively on the costs of the rule. Specifically, many gasoline refiners commented that the rule
will be too costly given the fact that they are have been subject to other fuel regulations recently
(such as the Tier 2 gasoline, Highway Diesel, Nonroad Diesel, and the upcoming Renewable
Fuels Standard rules). Those in the vehicle industry commented that new testing and phase-in
schedule requirements would lead to significantly increased costs for vehicle manufacturers.
2-2
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Rule is too lenient
Some commenters stated that, in general, they believe that the proposal is too lenient—
the rule is insufficient, does not go far enough in air toxics control, and/or provides too much
lead time for regulated entities. These comments are presented in more detail in the specific
chapters regarding the vehicle, gasoline benzene, and portable fuel container requirements
(Chapters 3, 4, and 5, respectively), and in the air quality discussions in Chapter 2. Further, as
discussed in more detail in Chapter 7, some commenters specifically argued that EPA's MSAT2
proposal falls short of meeting the requirements of Clean Air Act section 202(1).
A number of commenters stated that the Pacific Northwest has the dirtiest gasoline in the
country. The commenters stated that this gasoline contains 10 times the benzene found in other
oil, and that Northwest refineries have been exempted from EPA regulations that require benzene
removal in other parts of the country. The commenters urged EPA to strengthen the rule to
provide greater benzene reductions for this area of the country.
Letters:
Ad Hoc Coalition of Small Business Refiners OAR-2005-0036-0686
Alaska Department of Environmental Conservation, Division of Air Quality (ADEC) OAR-
2005-0036-0975
Alliance of Automobile Manufacturers (Alliance) OAR-2005-0036-0881
American Lung Association (ALA) OAR-2005-0036-0365
American Petroleum Institute (API) OAR-2005-0036-0366, 0367
Association of International Automobile Manufacturers (AIAM) OAR-2005-0036-0973
BP OAR-2005-0036-0824,0837
Countrymark Cooperative, LLP OAR-2005-0036-0471
Energy Future Coalition (EFC) OAR-2005-0036-0840
Engine Manufacturers Association (EMA) OAR-2005-0036-0810
Environmental Defense, Natural Resources Defense Council (NRDC), U.S. PIRG, American
Lung Association (ALA) OAR-2005-0036-0868
ExxonMobil Refining & Supply Company OAR-2005-0036-0772, -1013
Flint Hills Resources (FHR) OAR-2005-0036-0862
Giant Industries, Inc. OAR-2005-0036-0831, -0883
Hess Corporation OAR-2005-0036-0769
Illinois EPA (TL EPA) OAR-2005-0036-0830
Lane Regional Air Protection Agency (LRAPA) OAR-2005-0036-0848
Marathon Petroleum Company LLC (MFC) OAR-2005-0036-1008
Mitsubishi Motors R&D of America OAR-2005-0036-0882
Mothers & Others for Clean Air OAR-2005-0036-0991
Municipality of Anchorage, Department of Health and Human Services (Anchorage) OAR-
2005-0036-0976
National Petrochemical and Refiners Association (NPRA) OAR-2005-0036-0809
New Jersey Department of Environmental Protection, Division of Air Quality (NJDEP) OAR-
2005-0036-0829
New York State Department of Environmental Conservation (NYDEC) OAR-2005-0036-
0722
2-3
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NESCAUM OAR-2005-0036-0993, -0369
Oregon Department of Environmental Quality (ODEQ) OAR-2005-0036-0987
Oregon Toxics Alliance (OTA) OAR-2005-0036-0948
Private Citizens various
Puget Sound Clean Air Agency OAR-2005-0036-0780
Silver Eagle Refining, Inc. OAR-2005-0036-0839
Sinclair Oil Corporation, Flying J. Inc., Suncor Energy (U.S.A.) Inc., and Tesoro Corporation
OAR-2005-0036-0989, -1011
STAPPA/ALAPCO OAR-2005-0036-0836, -0378
TEIR Associates, Inc. OAR-2005-0036-0838, 1012
Toyota Technical Center (TTC) OAR-2005-0036-0773
United Refining Company OAR-2005-0036-0827
United States Senator Ron Wyden et al
United States Senator Michael Enzi et al
Washington State Department of Ecology OAR-2005-0036-0950
Wisconsin Department of Natural Resources, Bureau of Air Management (WDNR) OAR-
2005-0036-0828
Our Response:
We continue to believe that the program that we are finalizing today is necessary, and is
achievable (within the meaning of CAA section 202(l))in the time frame allowed; further, as
discussed in Chapter 2, this program provides significant air quality benefits from MSAT
reductions. We also believe that the lead time being offered is necessary for the manufacturing
and fuel industries to be able to comply with the rule. For an in-depth description of the
feasibility of the standards, please refer to Chapters 3, 4, and 5 (vehicle, gasoline benzene, and
portable fuel containers, respectively) of this Summary and Analysis of Comments, and Chapters
5, 6, and 7 of the Regulatory Impact Analysis (RIA). Further, as discussed in greater detail in
Chapter 7 of this document, we believe that the standards being finalized for the MSAT2
program are fully consistent with CAA section 202(1).
2-4
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2. ENVIRONMENTAL/AIR QUALITY AND PUBLIC HEALTH IMPACTS
What We Proposed:
The comments in this section correspond to Sections III through V of the preamble to the
proposed rule, and Chapters 1 through 3 of the Regulatory Impact Analysis. They are therefore
targeted at the environmental, air quality, and public health impacts from the proposal. A
summary of the comments received, as well as our response to those comments, are located
below.
For the full text of comments summarized here, please refer to the public record for this
rulemaking.
2.1 Public Health Issues
2.1.1 Public Health Justification and Implications for Controls
What Commenters Said:
A number of commenters stated that mobile source air toxics pose a significant risk that
justifies the proposed controls, and that EPA should do even more to reduce emissions. A
summary of these comments follows.
A private citizen stated that benzene causes a significant threat to human health and if it
is possible to reduce the amount of benzene being released into the environment, then it should
be done. The comments address the harmful side effects of benzene and six other chemicals
found in gasoline. If the levels of these chemicals in gasoline were reduced, the commenter
argues that there would be a significant savings in health care.
The Northeast States for Coordinated Air Use Management (NESCAUM) commented
that it believes that both onroad and nonroad mobile sources such as cars, trucks, buses,
construction equipment, lawn and garden equipment, snowmobiles, and boats emit pollutants
that cause cancer or other adverse health effects. The commenter further stated that it believes
that mobile source air toxics clearly pose a significant public health threat in the northeastern
U.S. and public exposure to toxic emissions from mobile sources is a major concern to health
officials and air quality regulators in the Northeast. They cite emissions inventory and air quality
monitoring and modeling data indicating that 50 and 74 percent of cancer and non-cancer risk
related to breathing outdoor air results from mobile source air toxics emissions. The commenter
further noted that Northeast state modeling and monitoring data indicate that ambient
concentrations of acetaldehyde, benzene, 1,3-butadiene, formaldehyde, acrolein, and diesel
particulate matter exceed risk screening thresholds for cancer and, in some cases, non-cancer
effects throughout the region. The commenter stated that a review of emissions inventory data
concluded that mobile sources dominate the primary emissions for these pollutants in all
Northeast states.
2-1
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NESCAUM commented that it believes that additional reductions in benzene are needed
because even the simplest risk assessment predicts that exposures to benzene (directly and
indirectly from the use of mobile sources) are very high throughout the US. The commenter
noted that it was stated in the RIA (p.3-48) that "...based on average census tract risks, the vast
majority of the population experiences risks between one in a million (IxlO"6) and one in ten
thousand (IxlO"4)". However, the commenter noted, the number of people experiencing risks
above one in a hundred thousand (IxlO"5) increases from 214 million in 1999 to 240 million in
2030. NESCAUM commented that, based on the experiences of the Northeast states with
monitoring, modeling, and controlling air toxics in the Northeast, it believes that the need for
more reductions in MS AT emissions is evident. The commenter cited the example of monitoring
data for Burlington, VT for 1999 which it stated documents that ambient air concentrations of
benzene exceeded health benchmarks (10"6 cancer risk) by roughly a factor of 20. The
commenter noted that, consequently, an urban-scale benzene modeling study was applied to the
Burlington area for 1999. The commenter stated that this study demonstrated that annual
ambient concentration impacts modeled in Burlington from motor vehicles over the whole
domain were anywhere from 5 to 20 times the Vermont health standard (0.12 ug/m3) for
benzene. Seventy six percent of this modeled local source annual benzene impact was due to
motor vehicle traffic.
NESCAUM also provided conclusions from recent studies of microenvironment
exposure levels in the Northeast, and stated these analyses provide evidence of the need for
substantial reductions in mobile source air toxic emissions. The commenter also stated that,
beyond the risk quantified in the national-scale modeling in the proposal's Regulatory Impact
Analysis, there are many more risks from exposure to MSAT that have not been quantified. The
commenter stated that it believes this increases the urgency for additional MSAT reductions in
the Northeast states.
STAPPA and ALAPCO noted that the proposal stated that 68 percent of our nation's
benzene emissions come from mobile sources and that benzene will continue to be the key
cancer risk driver into the future. The commenters stated that they acknowledge EPA's effort to
stem this risk, but believe that more can and should be done and that they strongly urge EPA to
maximize this opportunity to glean the greatest benzene reductions possible.
The Oregon Department of Environmental Quality (ODEQ) and Lane Regional Air
Protection Agency (LRAPA) commented that the EPA National-scale Air Toxics Assessment
(NATA) indicates that benzene is the most significant air toxic for cancer risk and that mobile
sources are the major source of benzene. The commenters asserted that benzene concentrations
in the Pacific Northwest have been among the highest in the nation. LRAPA further stated that it
believes that the MSAT rule revisions are the greatest opportunity to reduce benzene to safe
levels.
The New York State Department of Environmental Conservation (NYDEC) commented
that in its study of concentrations and trends of benzene in ambient air over New York during
1990-2003, a 50 percent or more decline in mean annual concentrations of benzene was
demonstrated. The commenter stated that it believes that this downward trend in benzene
concentrations can be attributed partly to: 1) the adoption of the Reformulated Gasoline Program
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(RFG) in 1-hr ozone non-attainment areas; and, 2) for other non-RFG sites, improvements in
vehicle emissions technology and the statewide adoption of the California Low Emissions
Vehicle (LEV) program. The commenter further stated that it believes that an examination of the
information included in this rulemaking indicates this proposal will not provide any real
meaningful reductions of MSATs in the New York City Metropolitan area over the next 24 years
and the predicted cancer risk estimates will remain steady or actually increase as a result of this
rulemaking. Similarly, NESCAUM stated that it believes that this rulemaking will only provide
small reductions in MSAT risk in areas that currently use RFG and have adopted the California
LEV program. NESCAUM stated that it believes that an examination of the information
included in this rulemaking indicates that the predicted cancer risk estimates in these areas will
remain steady or actually increase between now and 2030.
The New Jersey Department of Environmental Protection (NJDEP) commented that it
believes that "all risk assessments" predict that exposures to benzene, attributed directly and
indirectly to mobile sources are high. The commenter cited the Draft RIA (p.3-48) in describing
the population exposed to various risk levels (IxlO"6 - IxlO"4) in 1999 and in 2030. NJDEP also
summarized risk characterization data from the 1999 National Air Toxics Assessment and
concerns about exposures attributable to attached garages and residence near major roads,
commenting that the information supported the conclusion that emissions of hazardous air
pollutants from mobile sources is a "very serious problem." The commenter also summarized its
own analyses of 1996 NATA results, indicating that mobile sources are the predominant source
of several air toxics in New Jersey.
The Wisconsin Department of Natural Resources (WDNR) commented that it believe
that mobile source air toxics must be addressed in order to ensure that communities are as
healthy as possible. The commenter also expressed concern about its impression that EPA is
using benzene as a "the only surrogate" of mobile source air toxics in general.
Environmental Defense, the Natural Resources Defense Council (NRDC), U.S. Public
Interest Research Group (PIRG), and the American Lung Association (ALA) commented that
they believe that exposure to benzene presents a serious risk to human health. The commenters
further stated that they believe that benzene is responsible for carcinogenic and non-carcinogenic
health effects through all routes of exposure, and is found in considerable concentrations in
communities throughout the United States. The commenters noted that in 1999, 68 percent of
benzene emissions nationwide were from mobile sources, and stated that in the coming years
they believe that mobile sources will continue to be a major source of benzene.
The Alliance of Automobile Manufacturers (Alliance) stated its support for EPA's
initiative to reduce mobile source air toxics, and indicated that it understands the goal of a
healthier environment
ExxonMobil and the American Petroleum Institute (API) commented that they view the
health justification for the proposal as inadequate. ExxonMobil further stated that the discretion
afforded EPA in CAA 202 (1) should only be exercised after an adequate health based
justification. The commenters also asserted that cancer risk due to benzene from mobile sources
could fall below a de minimis risk level before implementation of the fuels program, especially if
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the lower range, or possibly even the midpoint of the range of "equally scientifically valid" unit
risk estimates is used to calculate benefits.
Letters:
Alliance of Automobile Manufacturers (Alliance) OAR-2005-0036-0881
American Petroleum Institute (API) OAR-2005-0036-0884
Environmental Defense, NRDC, U.S. PIRG, ALA OAR-2005-0036-0868
ExxonMobil Refining & Supply Company OAR-2005-0036-0772
Lane Regional Air Protection Agency (LRAPA) OAR-2005-0036-0848
New Jersey Department of Environmental Protection OAR-2005-0036-0829
New York State Department of Environmental Conservation (NYDEC) OAR-2005-0036-
0722
NESCAUM (Northeast States for Coordinated Air Use Management) OAR-2005-0036-
0993
Oregon Department of Environmental Quality (ODEQ) OAR-2005-0036-0987
STAPPA/ALAPCO OAR-2005-0036-0836
West Chester University of Pennsylvania Student OAR-2005-0036-0368
Wisconsin Department of Natural Resources (WDNR) OAR-2005-0036-0828
Our Response:
Section 202 (1) (2) requires EPA to adopt technology-based (indeed, technology-forcing)
regulation of air toxics from motor vehicles to the maximum extent achievable, taking into
consideration cost, energy, noise, safety, and lead time. See Sierra Club v. EPA, 325 F. 3d at
378 (section 202 (1) (2) is technology-forcing and so requires EPA to consider future advances in
pollution control capability, among other factors). It is not a risk-based provision whereby the
reasonableness of the rule is determined by evaluating whether some measure of risk reduction is
achieved. Section 202 (1) (2) also states, however, that the rules for air toxics are to be
promulgated under sections 202 (a) (1) (vehicles) and 211 (c) (1) (fuels). Both provisions
contain certain risk-based condition precedents to exercise of the technology-based authority.
This condition precedent is a showing that emissions (or, for fuels, emission products) "cause, or
contribute to, air pollution which may reasonably be anticipated to endanger public health or
welfare." We believe the information presented in the preamble and the RIA support such a
judgment, and agree with the comments that concurred with this determination. We disagree
with the comment that the health justification is inadequate to move forward with technology-
based regulation.
While we agree that the mobile source air toxics increase the risk of health effects and
that risks will remain after the rule is implemented, we believe the rule achieves the "greatest
degree of emission reduction achievable through the application of technology which will be
available, taking into consideration the motor vehicle standards established under section 202(a)
of the Act, the availability and cost of the technology, and noise, energy and safety factors, and
lead time" (Clean Air Act section 202(1)).
In response to the comment that cancer risk due to benzene from mobile sources could
fall below a de minimis risk level before implementation of the fuels program , unlike other
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provisions of the Clean Air Act, section 202(1)(2) does not direct EPA to set standards to
eliminate or achieve a certain level of risk. Nevertheless, EPA would like to note that in setting a
NESHAP (National Emission Standards for Hazardous Air Pollutants) for benzene in 1989 (FR
54, 177: 38044-38072; September 14, 1989), a de minimus risk level was not defined based on
average population risk. Acceptability of risks in a population were based on the individual
exposed to the maximum level. If average risks are below the one in a million level, a significant
number of people in the population could still be judged to have "unacceptable" risks under the
criteria set in this NESHAP.
We note that comments indicating that we are using benzene as the "only surrogate" of
mobile source air toxics more generally are incorrect. The standards in this rule are expected to
reduce emissions of a broad range of particulate and gaseous air toxics other than benzene.
We disagree that there will be no meaningful reductions of MSATs in the New York City
metropolitan area or areas that currently use RFG and have adopted the California LEV program.
The vehicle standards add cold temperature emission standards to existing requirements
nationally, and these standards address lower temperatures than California's LEV standards,
which extend to only 50 degrees Fahrenheit. As a result, substantial reductions in cold-
temperature emissions are expected to accrue even in areas that have adopted the California LEV
program, with concurrent reductions in risk. Furthermore, the portable fuel container emission
standard will provide substantial reductions in MSAT emissions and exposures.
2.1.2 Benzene
What Commenters Said:
Based on material cited in Chapter 3 of the RIA, the New Jersey Department of
Environmental Protection asserted that benzene may be even more potent than EPA's IRIS
(Integrated Risk Information System) database suggests. In particular, the commenter noted the
RIA's note that the cancer dose-response curve for benzene may be "supralinear" and that
benzene metabolism may be saturated at Ippm. The commenter noted the RIA's statement that
health effects from occupational exposures to benzene have been seen below the Ippm level.
API and ExxonMobil commented, with the endorsement of Marathon Petroleum
Company, that they believe that in the proposal, EPA overstated the predicted health benefits of
the rule, and as such, the benzene content standard for gasoline is not adequately justified. They
first noted that while benzene is identified as a national risk driver under the 1999 NAT A,
predicted increases in the number of people exposed to higher risk levels are due to population
growth, rather than increased benzene emissions.
API and ExxonMobil comment that EPA provided an unbalanced view of the science
regarding benzene's health effects, and that benzene risks are equally if not more likely to be
overestimates than underestimates. In particular, the commenters assert that EPA made several
questionable or incorrect statements in discussing how its risk assessment could underestimate
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benzene risk. Specifically, they suggest that EPA's following assertions are questionable or
incorrect:
• EPA's mention of the possible supralinearity of benzene's dose-response function
at environmental exposure levels, noting that even if one metabolic pathway
saturates in the 1 ppm range, other processes of detoxification and clearance could
compensate and reduce risk above that level of exposure;
• benzene's association with more than one leukemia subtype;
• that a transition from linear to saturable metabolism below 1 ppm could result in
underestimation of risk;
• assertion that the National Cancer Institute (NCI) Chinese cohort study as not
having undergone review under Integrated Risk Information System (IRIS) or
consideration for establishing the benzene unit risk estimate.
They commented that EPA did not consider "reality checks," such as the absence of benzene
health effects in populations exposed to higher concentrations than the general public, such as
petroleum workers, for which they cited occupational epidemiology studies. In particular, they
cited a meta-analysis of petroleum worker epidemiology studies in which relative risks for
leukemia were near 1 (Wong and Raabe, 1995). They also cite the lack of consistency in
epidemiologic studies of gas station attendants and vehicle mechanics. Accordingly, they
asserted that the true risk for benzene induced disease from current environmental exposures
could be zero, and cite EPA's use of such language in describing risk from diesel exhaust
exposure.
Letters:
American Petroleum Institute (API) OAR-2005-0036-0884
ExxonMobil Refining & Supply Company OAR-2005-0036-0772
New Jersey Department of Environmental Protection, Division of Air Quality OAR-2005-
0036-0829
Marathon Petroleum Company (MFC) OAR-2005-0036-0946
Our Response:
We disagree that the Agency provided an unbalanced view of the science regarding
benzene health effects.
EPA believes that the best currently available peer-reviewed published scientific
information/data sources on health effects of benzene should be used for health hazard or risk
determination. EPA's preferred choice of source for this determination remains the currently
available EPA IRIS values. When EPA IRIS assessments are updated, EPA uses emerging peer-
reviewed scientific literature and/or other assessments in support of hazard risk determination. A
brief summary of emerging science is provided below.
EPA (IRIS, 2000) concluded that "some recent evidence suggests the possibility that the
low-dose curve could be supralinear since the formation of toxic metabolized plateaus above 25
ppm benzene in air. Thus, it is possible that the unit risk is underestimated if linearity is assumed
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at low doses." Furthermore, EPA concluded that "there is no sufficient evidence currently to
reject a linear dose-response curve for benzene in the low-dose region, nor is there sufficient
evidence to demonstrate that benzene is, in fact, nonlinear in its effects." In absence of this
information, EPA recommended a default approach of using a model with low-dose linearity and
estimated the risk at 1 ppm ranging from 7. IxlO"3 to 2.5xlO"5, within which any calculated unit
risk estimate would have equal scientific validity. For risks ranging from IxlO"4 to IxlO"7, the
corresponding air concentrations for lifetime exposure range from 0.013 to 13.0 |ig/m3 (0.004 - 4
ppb) using the higher end of the unit risk range to 0.045 to 45.0 |ig/m3 (0.014 - 14 ppb) using the
lower end of the unit risk range.
Since the revision to the IRIS assessment for benzene, additional research has been
published. Commenters made note of some recent studies (e.g. Wong and Raabe, 1995; Ruston
and Romaniuk, 1997; Schnatter et al, 1996; Glass et al, 2003). However, other recent studies
support a supralinear dose-response relationship between exposure and cancer risk for lower
exposure levels. For example, Rappaport et al. (2005) and Lin et al. (2006) characterized
relationships between levels of albumin adducts of benzene metabolites in blood and the
corresponding benzene exposures in benzene-exposed and control workers, after adjusting for
important covariates.1'2 The levels of reactive and hematotoxic benzene metabolites were less
than proportional to benzene exposure at air concentrations in the range of 1 to 10 ppm. Another
example is work by Rappaport et al., (2002), which indicates deviations from linearity beginning
at approximately 1 ppm.3 These examples would imply that linear fits of leukemia mortality
among occupationally exposed workers to hundreds of ppm of benzene could possibly
underestimate risks from benzene metabolites in persons exposed at lower (non-saturating) air
concentrations. All of these studies will be evaluated when EPA reconsiders health risks from
exposure to benzene.
The commenters also hypothesize that additional mechanisms of metabolism may
mitigate risk, even if enzymes saturate at around 1 ppm. While it is always possible some
unidentified metabolic pathway could impact risk, we are aware of no existing data to either
refute or support this hypothesis. EPA will continue to monitor research regarding low-dose
metabolism of benzene in humans.
As for the comments on the possible association of benzene with more than one leukemia
subtype, it should be recognized that while most of the epidemiological studies are generally
limited by confounding chemical exposures, and methodological problems, the overwhelming
evidence is consistent for excess risk of leukemia across studies. It should be recognized that
earlier studies are limited by a lack of information on leukemia cell types other than AML,
because leukemia used to be considered a single diagnostic category for epidemiological
investigation, partly because of historical nomenclature, small number of deaths by cell type, and
unavailability of cell-type specific rates for comparison.
The commenters selectively cite certain epidemiological publications referring to
"[e]vidence of uncertainties include inconsistent results from epidemiological studies (Ruston
and Romaniuk, 1997; Schnatter et al, 1996; Glass et al, 2003),4'5'6 "relative risk near unity"
(Wong and Raabe, 1995)7 and "Studies on CLL and benzene show equivocal results as some
recent reviews have revealed" (Schnatter et al., 2005; Linet et al, 1996).8'9 Inconsistencies
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across the epidemiological studies are to be expected given the uneven power and quality of the
studies with respect to their ability to provide meaningful information on the existence of cancer
risks from benzene exposure. The more informative studies show increased risks of leukemia.
In contrast with the commenter's view that EPA did not consider "reality checks," such as the
absence of benzene health effects in occupationally exposed populations and the comment that
the results of epidemiologic studies of leukemia in some worker groups are inconsistent, on the
contrary, the preponderance of evidence based on epidemiological studies and case reports
clearly indicates a causal relationship between occupational exposure to benzene including
benzene-containing solvents and the occurrence of acute nonlymphocytic leukemia (ANLL),
particularly, the myeloid cell type (acute myelogenous leukemia, AML) (Rinsky et al, 1987,
2002; Yin et al, 1996; Hayes et al, 1997).10'u'12'13 Several of the studies also provide suggestive
evidence of association between benzene exposure and non-Hodgkin's lymphoma (NHL) and
multiple myeloma (Hayes et al, 1997; Rinsky et al, 1987)10'13 and to some extent chronic
nonlymphocytic leukemia (CNLL) as well as chronic lymphocyte leukemia (CLL) (Vighani and
Saita, 1964; Aksoy, 1976, 1977; Infante et al, 1977; Rinsky, 1981, 1987) i°>Hi5,i6,i7,i8 Although
the Pliofilm study (Rinsky et al, 1987) provided estimates of leukemia risk at high levels of
benzene exposure, The NCI-CAPM (National Cancer Institute/Chinese Academy of Preventative
Medicine) study (Hayes et al, 1997, 2001) extended estimates of risk to lower levels of exposure
below 10 ppm.13'19 In spite of the recognition that the NCI-CAPM study and all other
retrospective investigations have limitations, the criticisms raised by Wong (1999) and Budinsky
et al (1999) do not negate the findings that significantly elevated risks for lymphohematopoietic
disorders occurred at substantially lower levels of benzene exposure than in the study of Rinsky
etal(1987).20'21
Rushton and Romaniuk (1997) investigated the risk of leukemia in workers in the
petroleum distribution industry who are exposed to low levels of benzene.4 Although they
reported no significant increase in the overall risk of all leukemia with higher cumulative
exposure or with intensity of exposure, the authors also noted that the risk was consistently
doubled in subjects employed in the industry for more than 10 years. There is a suggestion of a
relation between exposure to benzene and myeloid leukemia, in particular for acute myeloid and
monocytic leukemia. Risk was increased to an odds ratio (OR) of 2.8 for a cumulative exposure
between 4.5 and 45 ppm-years compared with 0.5 ppm-years. The Glass et al. (2005) study
suggests that benzene exposure is associated with a spectrum of hematologic neoplasms and
related disorders in humans.22 Risks for these conditions are elevated at average benzene-
exposure levels of less than 10 ppm. The Glass et al. (2003) study found an excess risk of
leukemia associated with cumulative benzene exposures and benzene-exposure intensities that
were considerably lower than reported in previous studies.23 They also concluded that no
evidence was found of a threshold cumulative exposure below which there was no risk. A recent
review of the literature of nine cohort and 13-case control studies on benzene exposure and
leukemia subtypes (Schnatter et al., 2005) concluded that high and significant acute myeloid
leukemia risks with positive dose-response relationships were identified across study designs.8
Risks for CLL tended to show elevations in nested case-control studies, with possible dose-
response relationships in at least two of the three studies. However, data on chronic myeloid
leukemia and acute lymphocytic leukemia are sparse and inconclusive.
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Regarding the comments that a description of the risk of benzene should contain a note
that the risks could actually be zero, no such language is found in EPA's IRIS summary or
supporting documents for benzene, and making such a statement would be highly speculative as
well as unsupported by the preponderance of published literature. In contrast to compounds for
which the human carcinogenicity is not known with certainty, benzene is known to be
carcinogenic to humans, and environmental exposure levels are not so far below the occupational
exposure levels exhibiting increased cancer risks that there is any expectation of zero cancer risk
given the genotoxic properties of benzene.
For these reasons, EPA disagrees with API and others that EPA overstates the health
benefits related to benzene control. However, EPA acknowledges using the upper end of the
maximum likelihood range in assessing cancer risk attributable to benzene exposure. This is
consistent with the way benzene risk is modeled in the National Air Toxics Assessment. It is
important to note that the rule is not justified based on some (asserted) level of risk, as EPA
again notes that it is reasonably interpreting section 202(1)(2) as requiring standards which are
technology-based (taking into consideration cost, energy, safety and other enumerated factors,
along with technical feasibility), not risk-based.
What Commenters Said:
ExxonMobil commented that because ambient concentrations of benzene lie below the
ice concentration (RfC) of 30 ng/m3, no non-cancer he
possible health effects of environmental benzene exposures.
reference concentration (RfC) of 30 ng/m3, no non-cancer health effects should be discussed as
Letters:
ExxonMobil Refining & Supply Company OAR-2005-0036-0772
Our Response:
The commenter inappropriately cites only ambient concentrations of benzene as the
context for discussion of non-cancer health effects. An RfC refers to a time-weighted exposure
concentration, rather than an ambient concentration. As discussed in Chapter 3 of the RIA,
indoor and personal breathing zone concentrations of benzene can be substantially higher than
ambient concentrations. Among the studies reported in Chapter 3 are those examining indoor
concentrations of benzene in homes with attached garages. In those studies, concentrations in
excess of 30 ug/m3 are not uncommon. In fact, one study from the mid-1990s reported
integrated 24-hour average benzene concentrations of 364 parts per billion by volume (ppbv),
which is substantially in excess of EPA's RfC.24 Other studies of homes, particularly in Alaska,
have shown 12 or 24-hour integrated concentrations in homes with attached garages over the
RfC as well. While these measurements are of daily duration, the frequency with which these
studies report concentrations in excess of the RfC indicates that long-term exposures above the
RfC are possible.
Occupational studies of benzene concentrations discussed in Chapter 3 also indicate that
among some professions, including those in the petroleum and parks management industries,
work-shift averages can exceed EPA's RfC. While these occupational exposures are not within
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the regulatory purview of EPA, reductions in fuel benzene concentrations are likely to reduce
exposures in some of these occupations, a view which is consistent with a 2002 review
publication.25
As such, while we do not quantify the reduction in non-cancer risk that is likely to result
from this rule, we believe that it is appropriate to discuss non-cancer health effects of benzene
due to the observation of indoor and personal air concentrations of benzene in excess of the RfC
in the literature reviewed in Chapter 3 of the RIA.
2.1.3 Other MSATs
What Commenters Said:
NESCAUM stated that it believes that other MSATs of concern in the Northeast are
formaldehyde and diesel particulate matter which would also be numbered among national
priorities if the risk assessment handled them properly.
NESCAUM commented that it does not support EPA's use of the UKF (unit risk factor)
for formaldehyde based on dose-response data from the Chemical Industry Institute of
Technology Centers for Health Research (CUT). The commenter asserted that it believes that
EPA inappropriately used a cancer potency factor for formaldehyde that may substantially
underestimate cancer risks. The commenter noted that EPA stated that it did not rely on the
dose-response value in the Integrated Risk Information System (IRIS) because the science is not
current; however, the commenter stated that it believes that by using the CUT formaldehyde
dose-response data to develop a revised cancer URF EPA has not followed the procedures set
forth in the Residual Risk Report to Congress for establishing peer-reviewed consensus dose-
response information. The commenter noted that the Residual Risk Report to Congress was
prepared as mandated by Section 112(f) of the Clean Air Act to provide Congress and the public
with a road map of the methods to be used by EPA to assess the risk associated with emissions of
HAPs which remained after the implementation of the NESHAP program. The commenter
stated that it believes that one of the essential considerations in risk assessment is the evaluation
of the source of the data and whether it has been peer reviewed, and it cited the Residual Risk
Report to Congress (p.56) to support its comments. NESCAUM summarized EPA's process for
developing IRIS assessments, and asserted that EPA did not follow this process in developing
the newer URF based on CIIT's analysis. The commenter stated that it believes that the use of
the CUT formaldehyde data in the analyses for this rule undermines the IRIS review process.
The NYDEC also commented on the non-peer reviewed cancer risk value for formaldehyde.
Letters:
NESCAUM OAR-2005-0036-0993
New York State Department of Environmental Conservation OAR-2005-0036-0722
Our Response:
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The EPA agrees that diesel particulate matter (and diesel exhaust organic gases) are
among the mobile source air toxics that pose the greatest risk to human health, and states this in
the preamble and RIA.
The EPA disagrees with comments from NESCAUM and NYDEC that the use of the
CUT unit risk estimate for formaldehyde is inappropriate. EPA believes that we should use the
best available sources of health effects information for risk or hazard determinations. As we have
stated previously, we do not rely exclusively on IRIS values. Rather, we consider all credible and
readily available assessments, as noted in the Residual Risk Report to Congress. For air toxics
risk assessments, we identify pertinent toxicity or dose-response values using a default hierarchy
of sources, with IRIS being the preferred source, to assist us in identifying the most scientifically
appropriate benchmarks for our analyses and decisions. The IRIS process contains a peer-review
process, and the resulting values represent EPA consensus. When adequate toxicity information
is not available in IRIS, we consult other sources in a default hierarchy that recognizes the
desirability of review and consistency with EPA risk assessment guidelines. This process ensures
that we have consistent and scientifically sound assessments. Furthermore, where the IRIS
assessment is relatively dated and newer peer-reviewed assessments are available, we will
consider the full set of such assessments in selecting the basis for the risk assessment. In the case
of formaldehyde, we have determined that the cancer potency derived using the approach
developed by CUT, which has been peer reviewed by an external review panel sponsored by
EPA and the Canadian government, represents an appropriate alternative to EPA's current IRIS
URE for formaldehyde. Therefore, this potency represents the best available peer-reviewed
science at this time. A comprehensive reassessment of cancer risk has been initiated by EPA's
IRIS program. This reassessment will include modeling analyses and endpoints (e.g.,
lymphohematopoietic cancer) not considered in the CUT assessment. The revised IRIS
assessment will represent the best available peer-reviewed science at the time of its completion.
What Commenters Said:
The Regional Air Pollution Control Agency (RAPCA), the NYDEC, and
STAPPA/ALAPCO urged U.S. EPA to investigate the impact of MSAT metals, and the
possibility of their control, as part of the rulemaking process. RAPCA and STAPPA/ALAPCO
urged EPA to consider the recent Health Effects Institute Research Report. NYDEC criticized
the rule's treatment of metals, and urged EPA to extend a ban on manganese to all fuel.
Letters:
Regional Air Pollution Control Agency (RAPCA) OAR-2005-0036-0771
New York State Department of Environmental Conservation (NYDEC) OAR-2005-0036-
0722
STAPPA/ALAPCO OAR-2005-0036-0836
Our Response:
EPA is reviewing the results of the recent HEI (Health Effects Institute) study26 and other
studies aimed at identifying the emissions of metals from mobile sources. EPA has research
projects underway and is analyzing other data to improve the understanding of metal emissions
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from mobile sources. This information, as well as that provided by HEI and others will be used
to inform any potential future action. EPA is also examining available data on tire and brake
wear emissions.
Regarding manganese use as a fuel additive, EPA is currently generating the information
needed to update an assessment of the potential human health risks related to having manganese
in the national fuel supply. Clean Air Act section 21 l(c) provides the primary mechanism by
which EPA would take actions necessary to minimize exposure to emissions of metals or other
additives to diesel and gasoline.
What Commenters Said:
The NYDEC stated that it believes that other mobile source air toxics may be
significantly contributing to the cancer risk (formaldehyde, naphthalene and other polycyclic
aromatic hydrocarbon compounds) but the NATA assessment uses no cancer risk estimate for
naphthalene and has not properly characterized the risk from polycyclic aromatic hydrocarbons
(PAHs) emitted from mobile sources. Furthermore, the commenter argues that nitro-PAHs are
among the most potent carcinogens known, yet are only briefly discussed in the rule. The
commenter also presents a review of science and health concerns regarding nitro-PAHs, arguing
that they can be formed in the engine or as a result of aftertreatment.
Letters:
New York State Department of Environmental Conservation (NYDEC) OAR-2005-0036-
0722
Our Response:
The analyses done to support this rule do quantify potential cancer risks from
naphthalene, using a dose-response value developed by California EPA. EPA's risk assessment
for this pollutant is currently in progress. NYDEC provided no specific comments when it
asserted that EPA had not properly characterized risk from PAHs. In addition, EPA quantifies
the risks associated with fifteen other PAH compounds by grouping the PAH compounds into
toxicity categories using risk values primarily from California EPA. For these risk
characterizations, refer to RIA Chapter 3, section 3.2.1.2. EPA is also concerned about potential
adverse health effects from PAHs and nitro-PAHs, and regulations addressing emissions from
highway diesel vehicles, nonroad diesel equipment, locomotives, and commercial marine vessels
will substantially reduce these emissions, particularly given the high efficiency of noble metal-
based wall-flow particle traps to effectively oxidize organic species including PAHs and nitro-
PAHs. EPA is also participating in research to better characterize emissions of PAHs and nitro-
PAHs from diesel engines. As this work progresses, EPA will be in a better position to evaluate
the need for further action.
What Commenters Said:
The American Chemistry Council Olefins Panel commented that it believes potential
health risks from exposures to low levels of 1,3-butadiene in ambient air are far below what is
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indicated in EPA's 2002 health assessment document, and in the Office of Transportation and
Air Quality's (OTAQ) proposed rule. The commenter provided a list of studies and a critique of
EPA's 2002 health assessment document for 1,3-butadiene. The commenter asserted that it
believes low levels of 1,3-butadiene typically found in ambient air in fact do not present
significant health risks. The basis for this conclusion is that:
1) EPA based its unit risk estimate on an upper bound estimate of the point of departure
(PoD) rather than on a maximum likelihood estimate.
2) EPA multiplied its cancer potency estimate by a nonstandard adjustment factor of two.
3) EPA's dose-response assessment does not account for the role of peak exposures;
4) Recent molecular epidemiology studies do not provide any evidence of cancer hazard at
current workplace exposures;
Accordingly, the commenter asserted that it believes EPA's proposed rule will be more health
protective than EPA has recognized. The International Institute of Synthetic Rubber Producers
(IISRP) submitted comments, stating that it has reviewed and is "in full support" of the
comments submitted by the American Chemistry Council Olefms Panel.
Letters:
American Chemistry Council Olefms Panel OAR-2005-0036-0823
International Institute of Synthetic Rubber Producers (IISRP) OAR-2005-0036-0807
Our Response:
EPA does not believe that its current unit risk estimate overstates potential health risks
from exposure to 1,3-butadiene in the ambient air. First, EPA's use of the upper bound estimate
for the PoD for the final unit risk estimate is consistent with EPA's 2005 Guidelines for
Carcinogen Risk Assessment (and with the interim draft of the guidelines which was operational
at the time the 1,3-butadiene assessment was finalized). This science policy established in the
new Guidelines eliminates the historical inconsistency in the treatment of human and rodent data.
The policy of using an upper bound estimate is not motivated by potential low-dose
computational instabilities in the models applied to rodent data, as this is not even an issue under
the Guidelines' two-step approach of modeling the data in the observable range to obtain a PoD
and then using linear extrapolation or a non-linear approach to estimate the unit risk or a
reference value for cancer. The Guidelines underwent their own external review process, and the
science policies presented therein are not generally topics for which EPA seeks external
comment in its chemical-specific assessments. Furthermore, EPA's risk estimates are "upper
bound" because they are based on upper bound estimates from the dose-response modeling.
A commenter also questions EPA's multiplication of its cancer potency estimate by a
nonstandard adjustment factor of two. EPA's use of such an adjustment factor is not
unprecedented. An adjustment factor of 2 was used in EPA's vinyl chloride assessment to
account for increased early-life susceptibility. In the case of 1,3-butadiene, the primary reason
for the use of an adjustment factor of 2 was to account for potential risk of breast cancer in
females. Females were not part of the study population in the epidemiology study which
provided the basis for the cancer potency estimate, so risks for female breast cancer could not be
estimated from the human data. Yet, in the rodent studies, the mammary gland was the one
concordant site exhibiting 1,3-butadiene associated tumors in both mice and rats, thus there was
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clearly a reason to be concerned about breast cancer risk in human females. In the external
review draft, this issue was addressed qualitatively but not quantitatively, and the Science
Advisory Board (SAB) recommended attempting to "quantitatively address, where possible,
differences between cancer potency for the occupationally exposed and the general population",
specifying females, other lifestages, and other potentially susceptible subpopulations. Because
there were no chemical-specific data on early-life susceptibility and EPA's 1,3-butadiene
assessment pre-dated EPA's 2005 Supplemental Guidance for Assessing Susceptibility from
Early-Life Exposures to Carcinogens, which recommends the use of default age-dependent
adjustment factors in the absence of chemical-specific data for carcinogens judged to operate
through a mutagenic mode of action, EPA did not quantitatively address potential increased
early-life susceptibility in its 1,3-butadiene risk estimates.
A commenter also argues that EPA failed to follow the SAB's recommendation that a
more appropriate model for 1,3-butadiene risk would factor out the peak-exposure component.
EPA did in fact consider a peak exposure analysis; however, the data on peaks were inconsistent
and did not support a quantitative analysis that factored out peaks. According to the original
study authors, based on their comprehensive dose-response analyses, the relationship between
1,3-butadiene peak-years and leukemia was irregular.
Finally, EPA would like to note that a recent study extended the investigation of 1,3-
butadiene exposure and leukemia among synthetic rubber industry workers.27 The results of this
study strengthen the evidence for the relationship between 1,3-butadiene exposure and
lymphohematopoietic cancer. This relationship was found to persist after controlling for
exposure to other toxics in this work environment.
What Commenters Said:
The Alliance stated its belief that due to uncertainties in the acrolein RfC, comparisons of
concentrations to the RfC are not meaningful in drawing conclusions about its public health
impacts.
Letters:
Alliance of Automobile Manufacturers (Alliance) OAR-2005-0036-0881
Our Response:
We disagree with the comment that comparisons of ambient acrolein concentrations to its
RfC are not meaningful. First, we do note in the RIA, when describing the hazard quotient
(HQ), that:
"[a] value of the HQ less than one indicates that the exposure is lower than the RfC and
that no adverse health effects would be expected. A value of the HQ greater than one
indicates that the exposure is higher than the RfC. However, because many RfCs
incorporate protective assumptions in the face of uncertainty, an HQ greater than one
does not necessarily suggest a likelihood of adverse effects. Furthermore, the HQ cannot
be translated to a probability that adverse effects will occur and is not likely to be
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proportional to risk. A HQ greater than one can best be described as indicating that a
potential exists for adverse health effects."
We feel that the acrolein RfC, which is from IRIS, is sufficiently robust to allow for this level of
information to be gained. Second, we note that concentrations of acrolein are such that in all
years modeled, a substantial fraction of the national population is predicted to have HQs greater
than one, and this holds regardless of whether the EPA RfC or California REL (Reference
Exposure Level) is employed in the calculation. These factors support the identification of
acrolein as an important air toxic of concern at environmental levels of exposure.
What Commenters Said:
NYDEC also commented that it is concerned that very little of the data that EPA relies
upon to support its actions is verifiable. The commenter stated that it believes that rulemakings
must be conducted openly, with the underlying data open to public inspection.
Letters:
New York State Department of Environmental Conservation OAR-2005-0036-0722
Our Response:
We disagree with comments that the methods and information presented in this rule are
"unverifiable." All the underlying data used to support analyses in this rule are publicly
available. In addition, methods and tools from the 1999 NAT A, and the improvements
implemented here are the best currently available for modeling exposures and risks from air
toxics on a nationwide scale. Furthermore, the dose-response values used were selected using
objective criteria described in the Regulatory Impact Analysis for the rule. We note that our
emission inventory methods and future risk estimation techniques have been peer-reviewed and
0£ OQ
published in scholarly journals, or are "in press" and are in online prepublication versions. '
2.1.4 PM
What Commenters Said:
International Truck and Engine Corporation commented that it objects to the proposal's
incomplete characterization of past findings regarding the health effects of diesel emissions. The
commenter stated that EPA should refrain from making statements about the alleged health
effects of "diesel exhaust" per se, which has no uniform or defined composition, or "diesel
particulate matter and diesel exhaust organic gases," as opposed to "diesel particulate matter,"
which was analyzed in the 1999 National-Scale Air Toxics Assessment (NAT A). The
commenter stated that it believes the Agency should also clarify that the data it relied upon in
reaching its prior conclusions are based solely on exposures to emissions from engines using old
technology and old, high-sulfur fuel formulations. International asserted that these conclusions
cannot be extended to current engines. Furthermore, the commenter stated that if the Agency
intends to reiterate the 1999 NATA's "qualitative" conclusion regarding the risk of exposure to
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diesel particulate matter, it should at least acknowledge the weaknesses in the underlying data, as
discussed in the 2002 Health Assessment Document for Diesel Engine Exhaust. The commenter
urged EPA to clarify that available evidence is inadequate to determine whether diesel emissions
contribute to asthma or allergenic responses. The commenter stated that it objects to an
"opaque" statement in the RIA that "[t]he RfC is not meant to say that 5 ug/m3 provides adequate
public health protection for ambient PM2 5. In fact, there may be benefits to reducing diesel PM
below 5 ug/m3 since diesel PM is a major contributor to ambient PM2.5." International
commented that this statement unfairly targets diesel PM as a means to achieve health benefits
associated with attainment of the NAAQS. International also commented that EPA should
remove or clarify its statement summarizing the current Air Quality Criteria Document for
Particulate Matter regarding the hypothetical link between exposure to particulate matter from
gasoline and diesel engines and cancer mortality.
Letters:
International Truck and Engine Corporation (International) OAR-2005-0036-0826
Our Response:
The EPA Health Assessment Document for Diesel Engine Exhaust30 attributes the
potential carcinogenic risk from diesel emissions to whole diesel exhaust, rather than diesel PM.
EPA also states the following in NATA on the potential carcinogenic risk associated with diesel
exhaust:
In this assessment, the potential risk from diesel exhaust emissions is not addressed in the
same fashion that other pollutants are. This is because data are not sufficient to develop a
numerical estimate of carcinogenic potency for this pollutant. However, EPA has
concluded that diesel exhaust ranks with the other substances that the national-scale
assessment suggests pose the greatest relative risk. First, a large number of human
epidemiology studies show increased lung cancer associated with diesel exhaust.
Furthermore, exposures in these epidemiology studies are in the same range as ambient
exposures throughout the United States. In addition to the potential for lung cancer risk,
there is a significant potential for non-cancer health effects as well, based on the
contribution of diesel particulate matter to ambient levels of fine particles. Exposure to
fine particles contributes to harmful respiratory and cardiovascular effects, and to
premature mortality. More information on health effects associated with diesel exhaust
can be found in the Health Assessment Document for Diesel Exhaust
The EPA Health Assessment Document for Diesel Engine Exhaust concludes that "long-
term (chronic) inhalation exposure [to diesel exhaust] is likely to pose a lung cancer hazard to
humans, as well as damage the lung in other ways depending on exposure." As stated in its
Health Assessment Document, EPA concluded that available data are not sufficient to develop a
confident estimate of cancer unit risk and limits EPA's ability to quantify, with confidence, the
potential impact of this hazard. EPA though did develop a perspective on risk concluding "there
is a reasonable potential that environmental life cancer risks from diesel exhaust may exceed 10"5
(one in a hundred thousand) and could be as high as 10"3." EPA cannot rule out the possibility
that the lower end of the risk range includes zero.
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While EPA's risk assessment is based on exposure to whole diesel exhaust, in its 2000 rule
EPA listed diesel particulate matter and diesel exhaust organic gases as a mobile source air
toxic.31 EPA concluded this listing was reasonable because:
1) There are several nontoxic components of diesel exhaust (e.g., water vapor, nitrogen,
oxygen)
2) This listing includes the components of diesel exhaust that are likely to contribute to the
cancer and noncancer hazard (with the exception of gaseous phase criteria pollutants,
such as NOX, 862, and CO which are subject to National Ambient Air Quality Standards)
3) The more precise listing provides Federal and State government, industry and public
interest groups an ability to focus on the components of diesel exhaust that pose a
potential concern for public health
4) This focus provides specific targets for emission reductions should future analysis
indicate that additional controls are necessary.
In the 1999 NAT A, diesel particulate matter is used as a metric for exposure to diesel particulate
matter and diesel exhaust organic gases.
EPA agrees with comments that the conclusions of the diesel health assessment must be
reevaluated to determine applicability to new technology engines. The EPA Health Assessment
Document for Diesel Engine Exhaust states that "while EPA believes that the assessment's
conclusions apply to the general use of diesel engine today, as cleaner diesel engines replace a
substantial number of existing engines, the general applicability of the conclusions in this health
assessment document will need to be revaluated." Language providing this clarification has been
added to the Regulatory Impact Analysis. EPA and other sponsors have funded a Health Effects
Institute program (Advanced Collaborative Emission Study) to characterize emissions (with the
emphasis on unregulated emissions) and health effects of engines designed to meet the 2007 and
2010 standards.
In response to the comment that EPA discuss weaknesses in underlying data which form
the basis of our conclusion that diesel exhaust is one of the pollutants that poses the greatest risk
to human health, we would like to point out that limitations of the data are discussed in EPA's
Health Assessment for Diesel exhaust, which is cited in the RIA. Readers can refer to that, but
since this rule is not regulating diesel PM, such a discussion is not warranted here.
In addition, one comment above recommended that EPA remove the statement that says
there may be benefits to reducing diesel PM below 5 |ig/m3 since diesel PM is a major
contributor to ambient PM2.5, because it unfairly singles out diesel PM. EPA - in its recent
rulemaking on PM2.5 and also in prior rulemaking directly applicable to mobile sources -
discusses and quantifies the general health benefits for reducing PM. Such benefits accrue from
reduction of diesel PM as well as any other PM. The EPA Health Assessment Document for
Diesel Engine Exhaust has a discussion of diesel PM and ambient PM as related to the NAAQS.
The EPA Health Assessment Document for Diesel Engine Exhaust also states that
"evidence is emerging that diesel exhaust exacerbates existing allergies and asthma symptoms."
These studies are discussed in the EPA Health Assessment Document for Diesel Engine Exhaust.
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EPA disagrees with the comments that we should remove or clarify the statement from
the PM National Ambient Air Quality Standard (NAAQS) that diesel PM and gasoline PM are
important hypothesized contributors to cancer mortality associated with PM2.5. The specific text
being referred to is taken from EPA's PM Criteria Document, page 8-318:
With regard to specific ambient fine particle constituents that may significantly
contribute to the observed ambient PM-related increases in lung cancer incidence and
mortality, PM components of gasoline and diesel engine exhaust represent one class of
hypothesized likely important contributors. Such mobile source PM typically comprises a
noticeable fraction of ambient fine particles in many urban areas, having been estimated
to comprise from ~5 to 30% of ambient PM2.s in some U.S. urban areas (see Chapter 3).
These mobile sources are reasonable candidates as contributors to ambient PM-lung
cancer risks, given their being sources of known cancer-causing agents (e.g., PAHs), as
are other coal-combustion and/or woodburning emission sources (at least during some
seasons).32
What Commenters Said:
The WDNR commented that EPA should pursue research into better understanding the
quantitative relationship between exposure to diesel emissions and adverse health outcomes such
as cancer. The commenter asserted that diesel engine emissions may play a significant role in
adverse health outcomes in communities. The WDNR suggested that EPA propose a draft
cancer unit risk estimate for diesel exhaust as soon as practicable.
NESCAUM stated that it believes that the risk assessment does not acknowledge the
importance of diesel particulate matter.
STAPPA and ALAPCO asserted that "diesel PM accounts for 70 percent of the risk from
all air toxics," and expressed disappointment that EPA did not address diesel PM in its proposal.
They comment that EPA should acknowledge the impact of diesel PM on public health and "at a
minimum describe what the agency has done to reduce diesel PM and identify additional
measures that can be pursued in the future."
Letters:
NESCAUM OAR-2005-0036-0993
STAPPA/ALAPCO OAR-2005-0036-0836
Wisconsin Department of Natural Resources (WDNR) OAR-2005-0036-0828
Our Response:
We agree with comments that diesel engines are important contributors to public health
concerns over air toxics. We note that EPA's Health Assessment Document for Diesel Engine
Emissions (HAD) and RIA Chapter 3 provide a comprehensive overview of health studies of
diesel exhaust and traffic more generally. We agree that it would be useful if EPA were able to
propose a cancer unit risk estimate for diesel exhaust. However, for several reasons outlined in
the HAD and in other documents, we do not at present feel that available occupational
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epidemiology or toxicology provide sufficient basis for quantification of cancer risk related to
diesel exhaust or its constituents.33'34
While the modeling analysis in this rule does not specifically model diesel PM or diesel
exhaust organic gases, EPA has made clear in a number of past and pending rules that it
considers reduction of PM and other pollutants in diesel exhaust to be of high priority. The
statutory requirements for this rule specifically call for achieving the greatest emission
reductions achievable. In the case of diesel PM, EPA's recent regulations introducing ultra-low
sulfur diesel (ULSD) and strict limits on PM emissions from on-highway and non-road diesel
engines constitute the greatest emission reductions currently achievable, and no further emission
reductions from the diesel engines covered by these rules are considered feasible at this time.
We note that EPA has recently proposed strict emission limits on emissions from diesel engines
powering locomotives and marine vessels. We also note that EPA has numerous voluntary
programs dedicated to reducing air pollution from diesel vehicles, including the National Clean
Diesel Campaign (www.epa.gov/cleandiesel) and the Smartway Transport Partnership
(www. epa. gov/smartway). The impact of other EPA actions are discussed in Section IV of the
preamble and Chapter 2 of the Regulatory Impact Analysis.
What Commenters Said:
The NJDEP cited recent research from California indicating that mobile sources may be
the largest source of ultrafine particles, and that these particles may have greater potential for
adverse health impacts than PM2.5 and PMio. The commenter asserted that currently employed
emission control strategies to reduce particle mass may not result in corresponding reductions in
ultrafine particle count. The commenter further stated that it believes that EPA should take steps
to reduce particle counts when considering emission control strategies and emission standards
aimed at reducing particle mass. It further called for greater research into ultrafine particle
emissions and control measures.
Sensors, Inc. cited information indicating that ultrafine particles are more important than
"just the PM measurements."
Letters:
New Jersey Department of Environmental Protection, Division of Air Quality (NJDEP) OAR-
2005-0036-0829
Sensors, Inc. (SEMTECH) OAR-2005-0036-0958
Our Response:
We agree that mobile sources are a major contributor to ambient concentrations of
ultrafine particles. Work cited in EPA's heavy-duty diesel rulemaking (66 FR 5048, January 18,
2001) shows that the EPA diesel PM standards will effectively control ultrafine particles by a
factor of 10 by oxidizing the volatile organic compound precursors and by an additional factor of
10 by reducing diesel fuel sulfur. Work since then continues to show that ultrafine PM is
effectively controlled by the EPA diesel PM standards, particularly when viewed across
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representative driving cycles.35 The recent rulemaking for the PM2.5 National Ambient Air
Quality Standard did not set a PM standard for ultrafine PM but did tighten the 24-hour PM2 5
standard and reaffirmed the annual PM2.5 standard and somewhat tightened the criteria for spatial
averaging. EPA is actively engaged in emissions characterization work for both diesel and
gasoline PM to make sure EPA has the latest information on exhaust PM including ultrafine PM.
This information will allow EPA to determine what additional PM controls are needed and move
to implement them.
What Commenters Said:
NJDEP and STAPPA/ALAPCO submitted comments that EPA needs to follow through
on its observation in the proposal that "gasoline exhaust is a significant source of particulate
matter, contributing to the health effects observed for ambient PM," and to continue its work "to
improve the understanding of PM emissions from gasoline engines, including the potential range
of emissions and factors that influence emissions."
The Regional Air Pollution Control Agency (RAPCA) commented that it recommends
expanded or more stringent requirements in advancing scientific understanding of PM emissions
from gasoline engines.
Letters:
New Jersey Department of Environmental Protection, Division of Air Quality (NJDEP) OAR-
2005-0036-0829
Regional Air Pollution Control Agency (RAPCA) OAR-2005-0036-0771
STAPPA/ALAPCO OAR-2005-0036-0836
Our Response:
We agree with comments that EPA needs to follow through on concerns regarding the
contribution of gasoline exhaust to parti culate matter. We note that the current rule is expected
to result in substantial cold temperature emission reductions of both direct and secondary PM
from new gasoline vehicles. We also note that we continue to lead a multi-sponsor research
program dedicated to characterizing PM emissions from a representative sample of light-duty
gasoline vehicles.
2.1.5 General Issues
What Commenters Said:
NESCAUM commented that it believes that the risk assessment should not use national
average exposures to represent the risk of exposure to MSAT (RIA p.3-46). The commenter
stated that it believes that the risk reduction estimated in Section 3.2 of the proposal RIA (from
2.3 xlO"5 to 1.7 xlO"5) is essentially insignificant, and that both risks round to 2xlO"5.
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Letters:
NESCAUM OAR-2005-0036-0993
Our Response:
We disagree that national average exposures do not provide useful information. EPA
uses a national average exposure to represent the impacts of air toxics on a national basis only in
reporting summary statistics and trends over time in air quality, exposure, and risk. However,
other statistical summaries feature prominently in our analysis. Throughout Section 3.2 of the
RIA, we make use of county-level maps in multiple years to express the effects of the rule in
different parts of the nation. Further, we have also calculated the population fractions exposed to
different levels of risk. We note that underlying the exposure model HAPEM6 is an assumption
of geographically-defined differences in ambient concentrations resulting from proximity to
major roads.
Furthermore, we note that Table 3.2-15 of the RIA presents information indicating that
the greatest reductions in exposure and risk accruing from this rule occur among individuals
experiencing the highest levels of risk.
We disagree that rounding risk reductions eliminates their importance. Modeling done to
support the final rule shows a 26% reduction in total cancer risk from MSATs from all sources
between 1999 and 2030, with controls in place, and a 40% reduction in benzene from all sources.
What Commenters Said:
NESCAUM commented that it believes that EPA has not adequately considered in this
proposed regulation the episodic, high-end exposures to respiratory irritants emitted from mobile
sources or the cumulative impact of exposure to multiple respiratory irritants such as
acetaldehyde, acrolein, formaldehyde, and diesel paniculate.
Letters:
NESCAUM OAR-2005-0036-0993
Our Response:
EPA is currently limited in its ability to assess health impacts of episodic, high-end
exposures to some pollutants, because of the lack of dose-response assessments for acute
exposures to air toxics. Thus, EPA is developing acute reference concentrations for compounds
that will be used to identify areas of potential public health risk from episodic, high exposures.
The commenter is incorrect that we have not considered the cumulative impact of multiple
respiratory irritants. We include an assessment of the cumulative respiratory hazard index in this
rulemaking (see RIA Section 3.2.1.2.2. Exposure and Risk Trends for Air Toxics). We also note
that the motor vehicle emission controls in this rule will also reduce primary emissions and
secondary formation of aldehydes. As noted below, EPA's diesel emission rules for onroad and
nonroad engines have made substantial contributions to reducing future diesel PM emissions.
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What Commenters Said:
NYDEC claimed that while risk estimates in NATA and tools like it are based on toxicity
estimates for individual chemical compounds, that the synergistic effects of the "complex
mixture of MS AT s" are unknown. It asserted that exposures to mixtures of MSATs may result
in "a greater risk" (greater than additive toxicity), emphasizing that sensitive subpopulations
such as children may be of particular concern, particularly when they live or attend school near
roadways.
Letters:
New York State Department of Environmental Conservation (NYDEC) OAR-2005-0036-
0772
Our response:
We agree that the synergistic effects (i.e., greater than additive effects) of the "complex
mixture of MSATs" are not well known. We also note that antagonistic effects (i.e. less than
additive) of mixture toxicities are also poorly understood. We note that we base our health
conclusions as to the effects of individual MSATs on information in EPA's IRIS, and other
sources where applicable. We consider toxicity of mixtures to be an area of long-term interest to
EPA. We also agree that subpopulations such as children may have differential susceptibility to
MSATs, both singly and in combination. Lastly, we note that the exposures of those living or
otherwise spending significant quantities of time near major roadways may be elevated. Chapter
3 of the RIA discusses these concerns in greater detail.
What Commenters Said:
The NJDEP and NESCAUM commented that EPA should better assess the risks to
children. This comment is in response to EPA's Supplemental Guidance for Assessing Early-
Life Exposure to Carcinogens, issued by the National Center for Environmental Assessment.
Letters:
New Jersey Department of Environmental Protection (NJDEP) OAR-2005-0036-0829
Our Response:
Regarding the need to better assess health risks in children, in response to EPA's recent
Supplemental Guidance for Assessing Early Life Exposure to Carcinogens,36 EPA has not yet
determined which pollutants meet the criteria for making adjustments to risks in order to better
reflect risks in children. This will be done as part of the IRIS process.
What Commenters Said:
The NYDEC commented that frequently in this rulemaking, EPA claims that additional
regulation cannot be undertaken because the Agency lacks sufficient or appropriate data. It
asserted, however, EPA has not made sufficient efforts to obtain data. Aside from EPA's own
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research, NYDEC claimed that EPA has not availed itself of a number of resources, such as the
Health Effects Institute (HEI), Coordinating Research Council (CRC), and states, municipalities
and their associations. EPA has also not utilized information that is (or should be) available to
the Agency through reporting under Sections 202(a)(4) and 206(a)(3) of the Clean Air Act.
Letters:
New York State Department of Environmental Conservation (NYDEC) OAR-2005-0036-
0772
Our Response:
We disagree with comments that EPA has not made sufficient efforts to obtain data
relevant to this rulemaking. As noted in section IB of the preamble of the proposal for this rule,
EPA has devoted substantial resources to the Technical Analysis Plan to which we committed
under the 2001 rule. Second, Chapter 3 of the RIA presents a comprehensive review of scholarly
exposure and health studies of "near roadway exposure." Third, we have incorporated many of
the findings of these studies into our analysis tools, including the exposure model HAPEM6.
Fourth, since the 2001 rule, EPA staff (as well as others) have published a number of articles in
scholarly journals that on many subjects including emissions characterization and exposure
projects reflect our efforts to better characterize air pollution gradients near major roadways. We
note that in performing this work, we worked closely with numerous states and metropolitan
planning organizations in several regions, or obtained local transportation data directly from state
or local governments. Fourth, we note that EPA's Office of Research and Development has
undertaken a major initiative related to exposures occurring near roadways. Included in this
effort:
• Analysis of near-roadway epidemiology studies - EPA and external researchers will assess
consistencies and inconsistencies in near road epidemiological study results, including the
metrics used to assign exposures for near road populations. A number of the key
epidemiological studies will be re-analyzed using common exposure metrics to better
estimate potential risks for populations living near roads. This work is being conducted
within EPA's National Health and Environmental Effects Research Laboratory (NHEERL).
• Monitoring studies of near-roadway pollution gradients - EPA is leading a consortium of
organizations, including the Federal Highway Administration, to conduct near road
monitoring assessments to better evaluate the relationship of traffic operating
characteristics with near road air pollution. Studies will be conducted in a minimum of
three cities in the U.S. using consistent monitoring methods to assess potential geographic
influences on near road air quality. This work is being led by of EPA's National Risk
Management Research Laboratory (NRMRL).
• Evaluation of existing emissions and dispersion models - Data from the field studies will
be used to evaluate the response and relationship of existing emissions and dispersion
models. In addition, EPA researchers will be conducting wind tunnel experiments of
several common roadway configurations to determine how pollutants disperse under these
conditions and how existing dispersion models handle these configurations. The roadway
configurations include at-grade roadways, depressed roads, elevated roads, and at-grade
roads with vegetation or noise barriers. This work is being run through the National
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Oceanic and Atmospheric Administration's Air Research Laboratory and EPA's National
Exposure Research Laboratory (NERL).
• Characterization of infiltration of pollutants into schools - As part of the research
consortium investigating near road concentration gradients, an assessment is being
conducted on how these emissions infiltrate into the indoor air of schools located near
major roads. This project will assess how the pollutants infiltrate, and what mitigation
techniques are available to improve indoor air quality in these schools. This research is
being lead by NRMRL.
• Assessment of mitigation measures - As described, wind tunnel tests will be conducted to
determine if vegetation and/or noise barriers may mitigate air pollution levels in close
proximity to roadways. In addition, the effects of noise barriers and vegetation will attempt
to be analyzed in the field concentration gradient measurement studies.
• Health effects of near-roadway emissions - As described, re-analyses of previous
epidemiological studies will provide enhanced information on the effects of traffic
emissions on public health for near road populations. EPA researchers will also be
determining the toxicity of PM samples collected near and far from major roadways as part
of the concentration gradient measurements. This work is being conducted between
NHEERL and NERL. EPA is also supporting health effects studies on traffic emissions as
part of the new PM Center grants through the National Center for Environmental Research
(NCER).
We also note that EPA is an active sponsor of HEI, and works closely with HEI in their
research. HEI has conducted a large number of projects related to mobile source emissions
(including PM, benzene, 1,3-butadiene, NC>2, and other compounds) that have been widely
accepted in the scientific community and used extensively by EPA in its regulatory programs.
Also, for a number of years, the automobile manufacturers submitted annual reports on their
emissions characterization work related to Section 202(a)(4). This and other emissions
characterization work, which taken together is actually very extensive, including that conducted
by EPA and the CRC, have been used in structuring the emission models for air toxics, MOBILE
6.2.
We also note our close involvement with CRC in co-sponsoring recent joint research,
including CRC's E-55/59 emissions study of heavy-duty diesel trucks and the EPA-led emission
study of light duty gasoline vehicles in the Kansas City Metropolitan Area, a multi-million dollar
program testing 500 gasoline vehicles for PM and other emissions, including detailed speciation
of PM and VOC emissions in a subsample of vehicles.
All of these emissions characterization and health projects conducted in the past several
years means that there actually was sufficient high caliber data which EPA could use in making
decisions about its mobile source air toxics regulations.
What Commenters Said:
The Alliance stated that MSAT inventories are decreasing with concurrent ambient
reductions. The commenter presents an analysis of air toxic emissions across model years and
concentrations in several urban areas. The commenter stated two major points: 1. Air toxic
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emissions are decreasing in conjunction with cleaner vehicle technology; and 2. Ambient air
toxic concentrations generally fall below the EPA defined reference concentrations (RfC). To
support its comments, the commenter showed figures which it stated shows reductions in various
MS AT emission factors (mg/mile), based on the model year of vehicles ranging from the 1970's
to 2005. The Alliance further commented that it believes that MSAT reductions will occur after
2005 due to the Tier 2 standards phase-in continuing through 2009 Model Year. The commenter
presented an analysis of toxic emission factors from the calendar year 2004 light-duty gasoline
vehicle fleet in comparison with a fully phased-in Tier 2 fleet in calendar year 2040, which
resulted in a reduction of greater than 70% for benzene, 1,3-butadiene, formaldehyde,
acetaldehyde, and acrolein. The commenter noted that its MOBILE6.2 analysis does not factor
in I/M benefits or changes in gasoline benzene content. The commenter stated that it believes
that greater reductions in MSATs may be evident if more representative fleet characteristics are
modeled. It also presented charts depicting trends in ambient toxics over time, showing
downward trends in concentrations of individual air toxics over time.
The commenter also presented analyses of trends in ambient concentrations from all
monitoring data across the U.S. for several mobile source air toxics. They present information to
indicate that between 1994 and 2004, ambient concentrations of benzene and 1,3-butadiene
underwent significant decline. They also state that although a general trend in concentrations of
formaldehyde and acetaldehyde is present, a "clear trend" could not be detected due to
atmospheric chemistry and the contribution of biogenic sources to direct and secondary aldehyde
formation. The do not present analyses of acrolein data because "EPA contractors concluded the
acrolein data are not reliable." They note that with the exception of acrolein, ambient
concentrations of ambient MSATs are below the relevant reference concentration (RfC).
The commenter also notes that a fact sheet accompanying EPA's National Air Toxics
Assessment (NATA) indicated that the risk of contracting cancer of any type is one in three,
while Table 3.2-6 of the proposal's RIA indicates that for 1999, the risk of cancer from on-road
vehicles is estimated at 3 in 100,000. They also note that by 2020, existing control programs will
make it so that only benzene exceeds the one in one million level of risk.
Letters:
Alliance of Automobile Manufacturers (Alliance) OAR-2005-0036-0881
Our Response:
We agree with comments that air toxic emission rates and ambient concentrations of most
air toxics underwent significant declines in the 1990s, and we discuss these data in the rule.
Also, EPA's future year inventories account for phase-in of Tier 2 vehicles, low sulfur standards
and other changes in fuels, inspection and maintenance (EVI) benefits, and other factors. We also
agree that for most air toxics, ambient concentrations are well below the RfC, indicating that
noncancer health effects from most individual air toxics are highly unlikely at ambient
concentrations.
We note that while most MSATs have ambient concentrations below their respective
reference concentrations, in the RIA we consider the totality of exposure from multiple
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pathways. We note that among the studies discussed in Chapter 3 of the RIA, a number of
studies report concentrations of benzene in indoor air and other locations that are in excess of the
RfC for benzene, generally in studies examining the influence of attached garages on benzene in
air. We expect the standards in this rule will substantially reduce exposures through this
pathway, as well through reducing concentrations in ambient air.
We note that the risk of dying of any cancer over a lifetime results from multiple factors,
including genetic, behavioral, and environmental factors, and that section 202(1)(2) is not a risk-
based standard. The standards in this rule make substantial reductions in the emissions of mobile
source air toxics, and we expect future cancer risks to decline as a result.
What Commenters Said:
Sensors, Inc. cited a 2006 presentation by Jean-Paul Morin of the French National
Institute of Health for Health and Medical Research, in which high emission ratios of nitrogen
dioxide to total oxides of nitrogen (NO2/NOx) were associated with increased oxidative stress.
The commenter urged EPA to begin examining this issue in greater detail.
Letters:
Sensors, Inc. (SEMTECH) OAR-2005-0036-0958
Our Response:
We agree with the comment regarding the importance of examining the public health
consequences of the fraction of NOx emitted as NC>2. At present, EPA is in process of revising
its air quality criteria document for NC>2 to account for recent studies of the species.
2.2 National-Scale Modeling
The following comments refer to the modeling approach employed in this rule for
quantifying air quality, exposure, and risk changes associated with the rule.
What Commenters Said:
The NYDEC asserted that it believes that while limited, the 1999 National Air Toxics
Assessment provided data that is useful in identifying air toxics of greatest concern, and the use
of similar tools in this rule is important.
API commented that the air quality modeling performed for this rule is not sufficiently
robust for regulatory purposes. The commenter cited text from the National Air Toxics
Assessment, indicating that the "NATA assessment should not be used as the basis for
developing risk assessment plans or regulations to control specific sources or pollutants." As
EPA's national-scale modeling employs tools similar to those in NATA, API asserted that the
limitations of the 1999 NATA are applicable for this rule. API asserted that the 1999 NATA did
not undergo independent peer review. API cited an evaluation of the 1996 NATA Assessment
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System for Population Exposure Nationwide (ASPEN) modeling and claimed that the best
correlation (Pearson's r) between modeled and monitored results found was 0.57, applied to the
Northeast. It notes the evaluation found lower correlations in other regions. On these bases, API
asserted that the ASPEN is not sufficiently robust for use in regulation.
API and Marathon Petroleum Company LLC (MFC) commented that the proposal relies
on 1999 NATA data, and that this source is out of date. The commenters assert that the 1999
NATA does not include the emission reduction benefits of EPA regulations that are already in
place, including Phase 2 reformulated gasoline (RFG), the 2001 MS AT rule, and fuel
desulfurization. API and MFC comment that the NATA should be updated with current data
prior to any regulation.
Letters:
Alliance of Automobile Manufacturers (Alliance) OAR-2005-0036-0881
Marathon Petroleum Company (MFC) OAR-2005-0036-0946
New York State Department of Environmental Conservation (NYDEC) OAR-2005-0036-
0772
Our Response:
We agree with NYDEC that the analytical approach employed in the 1999 NATA
provides useful information for identifying toxics of greatest concern, and that the use of NATA-
like tools in this rule provide important information
While the caveats that apply to the 1999 NATA do state that it should not be used as the
basis for risk assessment plans or regulations to control specific sources or pollutants, the
national-scale assessment results presented in the preamble and RIA of this rule are used only to
provide a perspective on risk, and were not used as the basis for any regulatory decision. We
would also like to note that, in this rule, we employed ASPEN and HAPEM6 to future years with
appropriate emission inventories for each year. This more extensive analysis provides more
information than a single year "snapshot," such as NATA. We note that the methodologies
employed for this rule underwent peer review in a scholarly journal and are in press as of the
publication of this rule.37 Finally, we note that comparisons of modeled air toxic concentrations
to monitor data show good agreement for benzene and acetaldehyde, but suggest that ASPEN
could be underpredicting for other air toxics. These comparisons are discussed in Section 3.2.1.3
of the RIA.
We disagree with the comment that NATA 1999's lack of accounting for more recent
regulations and emission changes makes the national scale modeling results in this rule outdated.
As described in the RIA, we modeled emissions, air quality, exposure and risk for 1999 and a
range of future years, accounting for the impacts of current and planned future programs.
What Commenters Said:
NESCAUM noted that as part of its March 2001 mobile source air toxics rulemaking,
EPA identified nonroad engine emission factors as a critical area of research and committed to
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data collection as part of a technical analysis plan. NESCAUM noted that EPA has since
completed a number of nonroad gasoline engine emission test programs, and that these data have
not been fully analyzed and incorporated into EPA's emission inventory tools. The commenter
exhorted EPA to update NONROAD and NMIM to incorporate these data, and complete any
needed emission testing programs and data analyses.
Letters:
NESCAUM OAR-2005-0036-0993
Our Response:
We agree with the comment on the need to incorporate emission test program data from
nonroad engines into the NONROAD and NMIM (National Mobile Inventory Model) models.
Section 2.3 of the Regulatory Impact Analysis discusses recent nonroad emission test programs
and plans to integrate data from these programs into the NMIM model.
EPA remains committed to increasing the available emission data from nonroad engines
through on-going efforts to fund testing and to leverage testing for engine emission data (criteria
pollutant and MSAT) in both gasoline and diesel nonroad equipment types. In 2006, EPA
initiated a nonroad pilot program to survey the population, activity, and emissions of
construction-type engines with on-board testing equipment. We continue to work with industry
sponsored trade and research groups, like Manufacturers of Emission Controls Association, to
test the effect of various emission control devices on engines used in several classes of nonroad
equipment. In-house, EPA has been testing the safety and level of emission control from various
configurations of small SI engine (lawn and garden, primarily) aftertreatment control equipment.
When appropriate, we will use available emission testing data to update our emission models.
2.3 Near-Road, Attached Garages, and Other Microenvironmental Exposure
2.3.1 Adequacy of Air Quality, Exposure and Risk Analysis
The following set of comments refer to methods EPA undertook in its analysis of air
quality, exposure, and risk from air toxics. The comments address the adequacy of EPA's
analytical approach, and highlight information regarding concentration patterns near major
roadways or in vehicles.
What Commenters Said:
The NJDEP and NESCAUM noted that the primary analysis in the RIA accompanying
this rule is based on a national-scale dispersion modeling study, which may be sufficient to
establish that mobile source air toxics are a serious national problem, but fails to address higher
exposures experienced by people living in urban centers, in homes with attached garages, and the
elevated exposures of people traveling in their cars, and higher exposures experienced by persons
living within 200 meters of roadways. NJDEP cited a recent publication from the RIOPA study
where concentrations of some gaseous air toxics were elevated near major roadways. The
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commenters stated that they believe that EPA should better assess the impact on people near
roadways. The commenter stated that it believes that, in order to protect the millions of people
who live in our most densely populated urban areas, EPA should better assess the impact on
people near roadways.
NESCAUM expressed concerns with results from recent studies which reveal exposures
that greatly exceed ambient monitored levels of mobile source air toxics in microenvironments in
the Northeast. The commenter cited the following conclusions from recent studies of
microenvironment exposure levels in the Northeast: 1) levels of benzene found in pedestrian and
bicyclist zones were approximately 10 times higher than typical ambient levels due to vehicle
exhaust; 2) PM2.5 levels at commuter train stations in Boston were found to peak at 1,000
micrograms per cubic meter - 50 to 100 times higher than ambient levels; 3) construction
workers operating post-1996 model year nonroad equipment were exposed to 8-hour PM2.5
averages as high as 600 micrograms per cubic meter; and, 4) an additional study outside of the
region found that vehicle drivers are exposed to PM and benzene levels that are 10 to 16 times
higher than ambient levels. The commenter stated that it believes that, in light of the public
health threat posed by mobile source air toxics, a more comprehensive evaluation of toxics risk
and additional control measures is needed from EPA.
NESCAUM commented that since the publication of the MS ATI rule, EPA has
conducted personal exposure and ambient air monitoring studies in homes, schools, near
roadways, vehicles and inside homes with attached garages. The commenter also noted that EPA
has also worked to improve existing models, such as the HAPEM. However, despite this initial
work, the commenter stated that it believes that the proposed rule does not fully address the
much higher exposures experienced by people living in homes with attached garages, or by
people traveling in their cars. The commenter further stated that it believes that the higher
exposures experienced by people living within 200 meters of roadways have not been
comprehensively addressed. The commenter noted that these issues are discussed in the RIA,
but stated that it believes that the full burden on the American people has not yet been quantified.
The commenter cited that HAPEM6 as an example, which incorporates near-roadway exposures,
was only extended to three states, Georgia, Colorado and New York. NESCAUM commented
that, since an improved version of HAPEM6 has been developed, it encourages EPA to
implement the model nationwide.
Environmental Defense, NRDC, U.S. PIRG, and ALA commented that because benzene
is emitted primarily by mobile sources, concentrations are elevated near major roadways, which
they commented that they believe is a significant health consideration. The commenters cited a
statistic that in 2003 12.6 percent of U.S. housing units were within 300 feet of a major
transportation source, and further noted that EPA has cited dozens of studies showing increased
benzene exposure for people who spend time on or near major roadways. The commenters noted
that these groups include regular commuters and highway patrol officers, people who live near
major roadways, and children who go to school near major traffic sources. Additionally, the
commenters noted that people who have garages attached to their homes are exposed to elevated
concentrations of benzene and other air toxics.
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The Alliance commented that the prevalence of "hot spots" of mobile source air toxics in
urban areas is unclear. They cited the Multiple Air Toxics Exposure Study (MATES-II) study in
California's South Coast Air Basin. They noted that the study did not report differences in mass
concentrations of air toxics between microscale monitors, including those located in close
proximity of freeways, and fixed-site monitors. They comment that MATES-II should be
viewed as one of the most complete studies examining spatial variation in ambient concentration
of air toxics.
Letters:
Alliance of Automobile Manufacturers (Alliance) OAR-2005-0036-0881
Environmental Defense, NRDC, U.S. PIRG, ALA OAR-2005-0036-0868
New Jersey Department of Environmental Protection (NJDEP) OAR-2005-0036-0829
NESCAUM OAR-2005-0036-0993
Our Response:
We agree with comments that concentrations of benzene and other pollutants are elevated
near major roadways. We also agree that exposures to these compounds may be elevated for
people who spend considerable time traveling on or working or living near major roadways, or in
proximity of other mobile sources.
We agree with the comments that HAPEM6 should be extended nationally. For this final
rule, we ran HAPEM6 for the entire nation and have based subsequent risk calculations on the
exposure modeling results.
We disagree with comments that our analyses fail to address exposures experienced by
people living in urban centers, traveling in their cars, or living near major roadways. First, air
quality, exposures, and risks in urban areas are modeled with an air quality model, ASPEN,
which employs emission inputs at the census tract level of resolution. We believe that this level
of detail provides sufficient representation of emission trends and resulting air quality in urban
areas. Second, the HAPEM6 exposure model, and its predecessor HAPEM5, explicitly include
microenvironments within vehicles, and have new approaches for calculating the time and
concentration that people experience while commuting. Third, NJDEP highlighted the study in
which outdoor Relationship among Indoor, Outdoor, and Personal Air (RIOPA) concentration
data were shown to be elevated near major roadways. We would like to point out that the Office
of Transportation and Air Quality directly funded the development of this study's geographic
component, the products of which are cited in Chapter 3 of the RIA.
We agree with the comment that EPA should better assess the impact of mobile source
air toxics on people living near major roadways and other mobile source-affected
microenvironments. However, we disagree that we have not been sufficiently diligent in
assessing the public health impacts of this phenomenon. We believe that EPA's efforts in this
field have been substantial. While all risks have not been quantified, we believe that at this
point, Chapter 3 of the RIA provides as much credible information regarding the nature and
magnitude of these risks as is currently possible.
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We agree with the comment that the MATES-II study is a valuable source of information
on spatial variability of air toxics, and acknowledge the lack of significant differences between
microscale and fixed ambient site monitors in that study. Three of the 14 microscale sites at
which air toxics were measured in the MATES-II study were sited to monitor mobile source
toxics near roadways during a four to five week period utilizing two to three samples per week.
While the study did not report elevated levels at these three microscale sites over these short
monitoring periods, ambient monitoring conducted at 10 sampling sites in the South Coast Air
Basin during a one-year period found concentrations of mobile source related compounds such
as benzene and 1,3-butadiene were generally high throughout the South Coast Air Basin.
However, taken in totality, the available scholarly literature, summarized in Chapter 3, provides
unequivocal evidence that concentrations of numerous air toxics, including benzene, are elevated
near major roadways.
2.3.2 Attached Garages
The comments in this section refer to the influence of residential attached (integral)
garages on indoor air quality.
What Commenters Said:
The Alaska Department of Environmental Conservation (ADEC) commented that homes
with attached garages predominate Alaskan housing in Anchorage and Fairbanks, noting that
these homes often do not have a barrier between the garage and the living area. The commenter
stated that it believes that evaporative emissions of cars and gasoline containers in the garage
cause high levels of benzene to permeate a home's living area. The commenter cited evidence of
high indoor benzene concentrations in Alaskan homes, noting that a 1998 from Anchorage found
indoor benzene concentrations in homes with attached garages exceeding concentrations in
homes without attached garages by over 60 |J,g/m3. ADEC also noted that in some rural areas of
Alaska, residents store fuel indoors to prevent "gelling," commenting that the portable fuel
container provisions of the rule will improve indoor air quality in such homes.
The Municipality of Anchorage Department of Health and Human Services (Anchorage)
noted that recent studies of homes with attached garages in Anchorage have found
concentrations of benzene that are substantially higher than nationwide survey data (EPA's
1980s TEAM study) of average concentrations indicate. Anchorage also refers to results of an
unpublished study that employed tracer gases to determine garage air infiltration into residential
living spaces in homes with attached garages. Anchorage reports that the study found that
approximately 27% of air and 90% of benzene in indoor air originated in an attached garage.
They also report that study results indicate that indoor air concentrations of benzene in
Anchorage are much greater than outdoor air. Anchorage also reported results of a telephone
survey of householders with attached garages. From the comment: "Approximately 30% stored
fuel in the garage. Though cars were parked overnight in 82% of garages, 52% contained one or
more snow blowers, lawn mowers, or chainsaws. Additionally, a motorcycle, ATV or similar
vehicle was parked in 23% of respondents' garages." Anchorage also cited as study from
Australia in which children exposed to benzene at concentrations of 6.3 parts per billion by
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volume (ppbv) were eight-fold more likely to have asthma. Anchorage noted that it has released
a request for proposals for a study of asthma and indoor Volatile Organic Compounds (VOCs) in
Anchorage.
ADEC commented that it believes that Alaskans may be exposed to relatively greater
concentrations of benzene than residents of other areas. ADEC stated its belief that given
benzene's classification as a carcinogen, benzene is an important pollutant with possible public
health implications. ADEC further commented that it believes that Alaskans face "a multi-
faceted problem":
• winter inversions keep pollutants in the breathing space of Alaskan residents;
• winter gasoline has higher benzene levels;
people's homes maximize exposure to their off-gassing cars in the garage.
ADEC stated that it believes that factors leading to high benzene exposure are exacerbated by
Alaska's gasoline having the highest benzene content in the nation. Lastly, ADEC cited a study
of 137 Anchorage homes by the Municipality of Anchorage, in which indoor benzene
concentrations averaged 70.8 ug/m3 for homes with attached garages and 8.6 ug/m3 for homes
without attached garages.
Letters:
Alaska Department of Environmental Conservation, Division of Air Quality (ADEC) OAR-
2005-0036-0975
Municipality of Anchorage, Department of Health and Human Services (Anchorage) OAR-
2005-0036-0976
Our Response:
We agree with the comments that homes in Alaska may have substantially higher indoor
concentrations of benzene as a result of benzene concentrations inside residential attached
garages. We note that the studies provided by Anchorage and ADEC have been useful
contributions to our summary and analysis of air toxics exposure data. We also note that the
greatest emission benefits from this rule, in percentage, will be realized in Alaska. See Chapter 2
of the RIA for details.
2.4 Emission Reductions
What Commenters Said:
NESCAUM acknowledged that formaldehyde emissions are expected to decline but
stated that it believes that additional reductions in the emissions of other MSATs are needed.
NESCAUM noted that in the RIA (p.3-43) several MSATs are flagged as "significant
contributors to cancer risk," including 1,3-butadiene, acetaldehyde, naphthalene and hexavalent
chromium. However, the commenter stated that it believes that the proposed rule did very little
to lower emissions of these significant pollutants.
Letters:
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American Petroleum Institute (API) OAR-2005-0036-0884
ExxonMobil Refining & Supply Company OAR-2005-0036-0772
Our Response:
We disagree with comments indicating that this rule does little to lower emissions of
"significant pollutants" not specifically addressed in this proposal. We note that the cold
temperature gasoline emission standards will reduce all VOC-based air toxics, as well as
particulate matter. Chromium is a trace contaminant in mobile source emissions, and the
processes leading to its emissions are not well understood. . Although engine wear, trace
contamination of fuel or oil may be likely sources, existing data do no allow an apportionment of
the extent to which any one process may effect emissions. In the 1999 NAT A, mobile sources
contributed less than 5% of the national chromium inventory and 13.4% of personal exposure
concentrations. However, the emissions data underlying the mobile source inventory are very
limited. Mobile source speciation fractions for Hexavalent Chromium (Cr(VI)) are based on data
obtained from utility boilers and gas turbines. Given these factors, we do not consider control of
mobile source Cr(VI) to be sufficiently supported by data or feasible to control at this point.
Also, contrary to several comments, we have addressed a broad range of air toxics,
although the fuel standard applies to benzene only. As noted above, the motor vehicle and
portable fuel container emission standards will substantially reduce emissions of many VOC
species, including air toxics.
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References
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3. NEW LIGHT-DUTY VEHICLE STANDARDS
What We Proposed:
The comments in this section correspond to Section VI of the Notice of Proposed
Rulemaking (NPRM), and therefore deal with the proposed light-duty vehicle standards. A
summary of the comments received, as well as EPA's response to those comments, is located
below. For the full text of comments summarized here, please refer to the docket for this
rulemaking.
The MSAT NPRM proposed new cold temperature non-methane hydrocarbon (NMHC)
standards for gasoline light-duty vehicles and trucks. We expected that by fully utilizing
available Tier 2 hardware and software control strategies during cold temperature operation,
manufacturers would be able to achieve this standard without major changes to Tier 2 vehicle
designs and without the use of additional technology.
We are finalizing, as proposed, two separate sales-weighted fleet average NMHC
standards: 0.3 grams/mile for vehicles at or below 6,000 pounds gross vehicle weight rating
(GVWR) and 0.5 grams/mile for vehicles over 6,000 pounds, including medium-duty passenger
vehicles (MDPVs). The lower weight category will consist of light-duty vehicles (LDVs) and
light light-duty trucks (LLDTs). The heavier weight category will consist of heavy light-duty
trucks (HLDTs) and MDPVs. NMHC emissions will be measured during the Cold Federal Test
Procedure (FTP) test at 20° F, which already requires hydrocarbon measurement. The new
standard does not require additional certification testing beyond what is required today with
"worst case" model selection of a durability test group.
As proposed, we will begin implementing the standard in the 2010 model year (MY) for
LDV/LLDTs, and MY 2012 for HLDT/MDPVs. In the first years of compliance, manufacturers
must ensure that 25% of the vehicles sold in each weight category achieve compliance.
Manufacturers will phase-in to 100% fleet compliance by MY 2013 for LDV/LLDTs, and MY
2015 for HLDT/MDPVs. The implementation schedule begins three model years after the Tier 2
phase-in is complete for each vehicle class.
3.1 Cold Temperature Requirements
What Commenters Said:
In its public hearing testimony, the American Lung Association (ALA) commented that it
supports cold weather NMHC standards.
Northeast States for Coordinated Air Use Management (NESCAUM) noted that the
NESCAUM states generally agree with the approach taken for control of cold start emissions
from motor vehicles.
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Toyota commented that it is encouraged by the Environmental Protection Agency's effort
to reduce ambient air toxics, stating that each component of the proposed rule promises to
improve and ensure sustained reductions of hazardous air pollutants (HAP) within our ambient
environment. They added that the proposed cold temperature NMHC standards and evaporative
emission system requirements will propel the automotive industry toward further utilization of
ultra clean vehicle technology. Toyota commented that the Agency's approach to regulate
mobile source air toxics through cold temperature hydrocarbon controls is both effective and
logical. Toyota submitted data confirming that benzene and NMHC levels highly correlate at
different temperatures, in agreement with the Agency approach of controlling benzene emissions
by way of a cold temperature hydrocarbon standard.
The Manufacturers of Emission Controls Association (MECA) commented that it
supports the U.S. EPA's proposed rule to reduce hazardous air pollutants from mobile sources by
lowering benzene content in gasoline; reducing exhaust emissions from passenger vehicles
operated at cold temperatures; and reducing emissions that evaporate from, and permeate
through, portable gasoline containers.
The State of Alaska Department of Environmental Conservation (ADEC) supports the
EPA proposal for cold temperature HC standards. ADEC commented that without a cold
temperature standard, manufacturers would only certify vehicles emission standards at higher
temperatures required by the Federal Test Procedure. With a cold temperature standard, vehicles
sold in Alaska are meeting emission standards in winter and summer. Reducing these HC will
help reduce production of secondary particulate, an important control for places like Fairbanks
on the verge of becoming nonattainment for PM2.5.
Anchorage commented that it supports improvement in hydrocarbon emission controls at
cold temperatures. The commenter stated that European application of cold temperature controls
suggests that adoption of this technology may be an inexpensive means to significantly reducing
exposure to air toxics in cold climates.
Letters:
American Lung Association OAR-2005-0036-0365
NESCAUM OAR-2005-0036-0993
Toyota Technical Center OAR-2005-0036-0773
Manufacturers of Emission Controls Association (MECA) OAR-2005-0036-0808
Alaska Department of Environmental Conservation, Division of Air Quality (ADEC) OAR-
2005-0036-0975
Anchorage, Municipality of, Department of Health and Human Services (Anchorage) OAR-
2005-0036-0976
Our Response:
The cold NMHC standards reflect the greatest achievable reductions of air toxics from
motor vehicles and will achieve significant environmental benefits. Colder temperature
emissions standards highlight an extremely effective opportunity to reduce air toxics by utilizing
the same emission control technology presently used at warmer operating temperatures. The
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standard emission testing temperatures and cycles represent validation points for the emission
control approaches, but they should not be treated as the only areas of emission control
optimization. Emission controls should operate effectively across all real-world conditions
experienced in normal driving, including operation at temperatures outside of standard emission
test temperatures.
3.1.1 Standard Level and Feasibility
What Commenters Said:
Equal Standards for Both Vehicle Weight Categories
The ALA commented that the proposed cold weather NMHC standard for HLDTs and
MDPVs should contain a second phase that reduces emissions to the same standard as applies to
LDVs in the future.
STAPPA/ALAPCO commented that they do not believe trucks of 6,001 pounds to 8,500
pounds GVWR and passenger vehicles up to 10,000 pounds, warrant less protective standards
than vehicles of 6,000 pounds GVWR or less, with the possible exception of work trucks.
The Wisconsin Department of Natural Resources (WDNR) commented that it believes
that the NMHC cold temperature standards for Light-Duty vehicles weighing above 6,000
pounds should be the same as for vehicles less than 6,000 pounds.
Different Standards for Different Weight Categories
The Alliance of Automobile Manufacturers (Alliance) commented that it supports the
proposal for separate fleet average 20°F NMHC standards for vehicles up to and including 6,000
Ibs. GVWR and 6,001-8,500 Ibs. GVWR. The commenter stated that Light-Duty Vehicles
(LDV) and Light-Duty Trucks 1&2 (LLDT >6,000 Ibs.) generally are equipped with smaller
displacement engines and may have fewer cold-temperature emissions control constraints due to
engine design. The commenter stated that it is reasonable to expect improved emissions
performance for these vehicles at colder temperatures based on manufacturers' ability to locate
the catalytic converter and oxygen sensors closer to the engine and achieve faster warm-up
times, and therefore a quicker transition to closed-loop fueling.
The Alliance noted, however, that these lighter vehicles typically have more restrictive
packaging constraints which may limit optimal emission control methods and options. (The
commenter noted that in some instances, hardware modifications on smaller vehicles would not
be feasible due to packaging constraints underbody or within the engine compartment.) The
commenter stated that, in contrast, HLDT vehicles (LDT3&4) 6,001-8,500 Ibs. GVWR generally
are equipped with larger displacement engines and have additional physical constraints that must
be accounted for when manufacturers design emission control systems; many of these vehicles
are designed for higher performance and/or utility purposes, and these differences force unique
considerations which make it appropriate to consider a higher standard for vehicles in these
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weight classes. The commenter stated that heavier vehicles (>6,000 Ibs. GVWR), designed for
utility and/or high performance, generate significant heat and exhaust temperatures. Thus,
catalyst systems may need to be designed and located farther from the engine to be protected
from heat damage, particularly for compliance with US06 requirements in the Supplemental
Federal Test Procedure (SFTP). Also, given the location and design constraints of these catalyst
systems, hydrocarbon control at cold temperatures is more difficult.
The Alliance noted that HLDT engines typically require more fuel to start and maintain
idle stability at cold temperatures and quench zones are larger. The commenter also stated that
the fuel required to start and idle is more than can be fully oxidized in combustion and
subsequently is carried through to the tailpipe prior to the catalyst reaching operating efficiency
(light-off), resulting in increased hydrocarbon emissions at cold start. The issue is compounded
by the increased exhaust mass flow prior to and during catalyst light-off, due to increased engine
friction at cold temperatures and higher/prolonged idle speeds. This results in increased mass
emission rates relative to lighter vehicles. The Alliance believes that these are compelling
reasons why the proposed 20°F NMHC standards need to scale with increasing vehicle weight.
The Alliance also believes that the 6,000 Ibs GVWR split point between the two fleet-average
20°F NMHC standards is also an appropriate proposal based on standard testing methodology
differences. The commenter stated that Adjusted Loaded Vehicle Weight (ALVW) test weight
methodology is applied to vehicles over 6,000 Ibs GVWR (vs. curb weight loading for vehicles
up to 6,000 Ibs. GVWR), and the more severe loading method produces higher loads and
consequently higher emissions on the chassis dynamometer. Lastly, the Alliance commented
that the 6,000 Ibs GVWR split point, combined with a sales-weighted averaging approach, also
avoids unwarranted bias and provides appropriate flexibility with 20° F emissions compliance
for full line vehicle manufacturers.
Level of Standards is Appropriate
Toyota stated that data submitted with its comments substantiates the ratio approach upon
which the Agency predicates their proposal for a cold temperature hydrocarbon standard (see
docket number OAR-2005-0036-0773.1, p.3 for Graph 1: Non-methane organic gas (NMOG)
mass emissions versus MS AT emissions). The commenter noted that in its data, Vehicle 1, a
Tier 2 BinS/Ultra Low Emission Vehicle II (ULEVII), and Vehicle 2, a Tier 2 Bin 8/ULEV II,
demonstrate the consistency of the ratio between air toxic and hydrocarbon emissions. Lastly,
Toyota stated that it supports this strategy as a successful means of HAP control.
Standards Will Be Challenging
The Alliance commented that the proposed standards will be extremely challenging to
achieve for the industry. Because the proposed standards are based on full useful life
performance, vehicles will require more robust designs, must rely on adequate fuel
specifications, and will need fuel quality control measures in the field. The commenter also
believes that with respect to the feasibility of the standards, manufacturers face a host of
competing requirements for exhaust emissions compliance. The commenter further stated that,
in order to maintain acceptable combustion quality, drive quality and defroster function, some
engines may not be able to employ equivalent emission control strategies at 20°F relative to what
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is feasible at 75°F. The commenter also stated that EPA must ensure that it does not adopt 20°F
NMHC standards that effectively increase the stringency of the current Tier 2 standards, which
are still completing phase-in. Further, the commenter noted, other EPA rulemaking efforts such
as the fuel economy labeling proposal, and related proposed test procedure changes, must not
inadvertently increase the stringency of the proposed 20°F NMHC standards.
The Alliance commented that, with respect to development and certification,
manufacturers currently must comply with FTP and SFTP requirements, at ambient temperatures
between 68°F and 95°F. The commenter stated that these higher temperature standards under
Tier 2 affect hardware decisions, such as catalyst location, and make it difficult to
simultaneously obtain optimal performance at colder temperatures, which are encountered less
often in-use. As a result of these competing requirements, the commenter noted, engineering
tradeoffs are often necessary and vary depending on the class of vehicle (i.e., passenger car vs.
utility truck). The commenter noted that another potential impediment to meeting 120,000 mile
full useful life standards is the wide array of commercial fuel properties found in the field. The
commenter stated that optimal emissions control designs are often limited by poor volatility fuels
during transitional months and inadequate control of fuel additives (which are needed to
maintain combustion efficiency). Consequently, calibration compromises are often needed to
accommodate the wide range of fuels and provide for robust start-up and driveability at cold
temperatures.
The Alliance commented that fundamental engine design and operating parameters are
important determinants of the maximum potential for cold temperature emissions control. Open-
loop fueling control must be used until the emissions control system reaches a sufficient
temperature to allow closed-loop control and optimized fueling strategies, and maintaining
acceptable combustion quality at lower temperature is an issue due to the potential for reduced
lean tolerance and reduced fueling precision, and it requires a tradeoff between fueling control
and spark timing.
Mitsubishi commented that it strongly disagrees with EPA's statement in the proposal
"we believe our proposed standards can be met by the application of calibration and software
approaches similar to those currently used at 50° F and 75° F" (71 FR 15847; col. 2). The
commenter further stated that it presented EPA with information demonstrating its inability to
achieve EPA's proposed Cold NMHC fleet average standard for light duty vehicle/light light
duty trucks of 0.3 g/mile for certification and full useful life (FUL) with only
calibration/software changes. The commenter noted that its feasibility study, based on 2005 and
2006 MY certification data and utilizing only calibration and software changes, indicated that
even reaching 0.4 g/mile for FUL is extremely difficult. Based on these results, Mitsubishi
believes that it will be unable to meet the proposed standard without major vehicle redesign to
incorporate additional hardware such as a secondary air injection system or hydrocarbon trap or
significantly alter their United States fleet mix to 100% expensive, Super Ultra Low Emission
Vehicle (SULEV) certified vehicles. The commenter did not provide any data in its comments to
support their feasibility concerns.
Mitsubishi further commented that in order to ensure their vehicles' driveability,
calibrations for cold conditions are compromised by the worst possible case of fuel properties
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(especially volatility) that are available in the U.S market and would limit the best optimizations
for cold NMHC control. The commenter suggested that if EPA believes that cold NMHC
reduction can be accomplished by the improvement of fuel calibration only, it requests that EPA
reduce such variance of the fuel properties in the U.S. market. The commenter noted that there
are other difficulties which they believe affect its ability to meet the proposed standard. The
commenter stated that it has limited opportunities for compliance flexibility (i.e., trading
between fleets) since it only manufacturers vehicles under 6,000 Ibs. Thus, the commenter
proposes that manufacturers of only light-duty vehicles should be allowed to comply with an
alternative standard between the less than and greater than 6,000 pound standards.
EPA's Feasibility Study Not Appropriately Assessing Emission Capabilities
The auto industry commented that the EPA's feasibility study and assessment does little
to demonstrate feasibility to meet the proposed 20° F NMHC standard. The commenter stated
that the actions used by EPA were too simplistic and that the study does not even confirm the
EPA premise that only calibration changes would be needed to meet the 20° F NMHC standards,
as EPA decided that operation of secondary air injection was determined to be a requirement and
that not all vehicles are equipped with this very costly hardware. The commenter noted that EPA
disregarded standard industry calibration practices and did not attempt to validate a calibration
which would satisfy driveability and customer satisfaction requirements.
Letters:
Alliance of Automobile Manufacturers (Alliance) OAR-2005-0036-0881
American Lung Association (ALA) OAR-2005-0036-0365
Mitsubishi Motors R&D of America OAR-2005-0036-0882
STAPPA/ALAPCO OAR-2005-0036-0836
Toyota Technical Center OAR-2005-0036-0773
Wisconsin Department of Natural Resources, Bureau of Air Management (WDNR) OAR-
2005-0036-0828
Our Response:
While some comments indicated that vehicles over 6,000 Ibs. GVWR should be required
to meet the same standards as the lighter vehicles, we continue to believe that it is appropriate to
have different standards for vehicles of different weights. Generally, we believe that heavier
vehicles will have inherent design differences in the engine and emission control system
hardware specifically to address expected customer usage and duty cycle. These design
differences, including engine size and exhaust aftertreatment design may result in a much higher
degree of difficulty achieving the same emission levels as vehicles not designed with similar
utility capabilities.
The level of the standard for both of the weight classes was determined from analyzing
certification Cold Carbon Monoxide (CO) results from many different vehicles and model years.
(See Chapter 5 of the Regulatory Impact Analysis (RIA) for the analysis.) This data set included
vehicles certified to Interim Non-Tier 2 and Final Tier 2 emission standards (at 75° F) and tested
at different weights representing a variety of GVWRs. We observed a general trend of
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increasing emission levels with increasing test weight across all available certification results.
While the data set included only a limited number of Final Tier 2 vehicles certified to the over
6,000 Ibs. GVWR, the data did support the engineering expectation of higher emissions with
heavier vehicles. Some heavier vehicles did perform at levels approaching the lighter weight
standard; however, the initial over 6,000 Ibs. GVWR vehicles certified to Tier 2 standards likely
represent the cleaner, less challenging vehicles which are generally the first to be phased in to the
Tier 2 program. These vehicles may initially contain hardware content not typical of similar
weight Tier 2 vehicles. Additionally, the feasibility test programs performed by EPA further
support the level of the standard and confirm that heavier vehicles with typically larger
application specific engines will have higher difficulty achieving the same emission levels as
lighter and smaller engine vehicles. It is likely that extensive additional hardware beyond that
required by Tier 2 would need to be added for many of these heavier models if required to meet
the same emissions standards as the lighter models. However, as these heavier vehicles become
Tier 2 compliant, we will continue to monitor emission levels and evaluate the appropriateness
of the higher cold temperature standard.
We do not agree with the comment that vehicles over 6,000 Ibs. will be tested with a
more severe ALVW loading test method. With the phase-in of Tier 2, vehicles over 6,000 Ibs.
GVWR are required to comply with Cold CO standards using Loaded Vehicle Weight (LVW)
test weights rather than ALVW test weight which is required for Non-Tier 2 vehicles. LVW is
curb weight plus 300 Ibs. while ALVW is the average of LVW and the typically much higher
GVWR. This reduction in the test weight loading method will occur on all light duty vehicles
over 6,000 Ibs. GVWR by 2009 MY when 100% Tier 2 compliance is required. However, even
with this change in test weight methodology, heavier vehicles will generally be tested at higher
weights due to their higher curb weights and are typically equipped with larger engines and
therefore remain a greater challenge for cold temperature emissions control than lighter vehicles.
One commenter indicated that they did not agree with our assessment that the proposed
standards for light-duty vehicles could be met with the same calibration and software approaches
currently used at 50° F and 75° F. While not all software and calibration approaches can be used
at 20° F (e.g., lean start operation), we continue to believe that many of the long-established
approaches are appropriate and will be highly effective. Similarly, prior to the implementation
of the California 50° F NMHC requirement, many of the approaches to reduce emissions at 75° F
were not used at 50° F, but later proved effective at that lower temperature. To support our
position that these same controls could be used at colder temperature, our own limited feasibility
test program specifically targeted using only the controls already available and practiced at 50° F
and 75° F. Although this feasibility test program was limited in scope, its results indicate that
these controls are highly effective at approaching and complying with the level of the new
standard (consistent with engineering expectation). We continue to believe that efforts to control
engine emissions and to optimize existing Tier 2 hardware generally will negate any need to
incorporate SULEV or other new hardware. This is because most hardware improvements used
in SULEVs (catalyst loading, oxygen sensors) are generally not immediately usable following a
cold start. Therefore, compliance with the standards will necessitate optimized calibration and
software controls to limit emissions produced by the engine prior to catalyst light-off
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The commenter also indicated that its own assessment based on its 2005 and 2006 MY
certification data indicated their inability to achieve the new standard. However, these 2005 and
2006 MY vehicles used for the assessment do not reflect any control efforts. Some significant
level of development effort would be required to fully explore existing opportunities in these
models. In fact, certification results for some of this manufacturer's current vehicle offerings
indicated that some specific vehicles models are close to achieving or have achieved the standard
without any intentional development effort to control NMHC emissions. In addition, the design
of the fleet average standards provides flexibility to manufacturers by allowing them to meet
different vehicle specific standards (i.e., Family Emission Limits) to address any unique
situations. Manufacturers can choose which vehicle lines to concentrate their emission reduction
efforts while still achieving an overall fleet wide average.
The 0.3 g/mile fleet average standard for the vehicles below 6,000 Ibs GVWR is
appropriate and supported by our assessment (see Regulatory Impact Analysis). We know of no
engineering basis for this standard not being technically achievable. We consequently do not
accept the commenter's suggestion to adopt an alternative standard for manufacturers with a
product line limited to vehicles below 6,000 Ibs. GVWR. Indeed, there are nine other
manufacturers with product lines exclusively below 6,000 Ibs. GVWR that did not provide
similar comments requesting an alternative standard.
The auto industry also stated that EPA must ensure that it does not adopt 20°F NMHC
standards that effectively increase the stringency of the current Tier 2 standards. As supported by
our assessment (see Chapter 5, section 5.1.2, of the RIA), we believe that level of the standard
does not inadvertently increase the stringency of current Tier 2 standards by requiring new
hardware for the cold standard. Several Tier 2 certified packages in our assessment already
achieve emissions levels below the new standard including one manufacturer's entire vehicle
product line. With respect to development and certification, the commenter noted that
manufacturers currently must comply with FTP and SFTP requirements, at ambient temperatures
between 68°F and 95°F. The commenter stated that these higher temperature standards under
Tier 2 affect hardware decisions, such as catalyst location, and make it difficult to
simultaneously obtain optimal performance at colder temperatures, which are encountered less
often in-use. As a result of these competing requirements, the commenter noted, engineering
tradeoffs are often necessary and vary depending on the class of vehicle (i.e., passenger car vs.
utility truck). We understand the possibility of competing requirements depending on vehicle
class and we believe separate fleet averages properly address these challenges. In addition, we
are providing lead time and program flexibilities such as averaging to help manufacturers
address issues with various models across their product lines.
While comments were submitted suggesting that potential variances in the fuel properties
could affect NMHC emission levels, no supporting data was submitted substantiating any
problem in the fuel pool or any vehicle emission impact. In fact, yearly fuels surveys performed
by the Alliance indicate no issues in the US fuel supply during the colder months that would
impact the ability to achieve these emission standards. Certain challenges may exist for some
vehicle systems during certain seasonal fuel changes or other temporary situations but these
situations can be managed through robust emission control approaches. We believe that some
manufacturers and vehicle models are already using these robust approaches based on the
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existing certification test results (see Chapter 5 of the RIA). We are providing the manufacturers
with lead time necessary to evaluate and address any issues with their products.
We disagree with the auto industry comment that EPA's feasibility study and assessment
does little to demonstrate feasibility to meet the proposed 20° F NMHC standard. Data to support
the feasibility of complying with the 20° F NMHC standard includes evidence from recent model
year certification emissions data submitted to EPA and a vehicle feasibility evaluation program
(see Chapter 5, section 5.1.2, of the RIA). The certification data indicate many production
vehicle models with emissions levels below the cold standard, which presumably (because they
are production vehicles) employ thoroughly validated calibrations which would satisfy
driveability and customer satisfaction requirements. The feasibility evaluation program
undertaken by EPA examined the effects of making only calibration modifications to two
vehicles deemed challenging due to their heavier weight.
In the case of the first feasibility vehicle, equipped with secondary air injection, we
acknowledge that not all vehicles are equipped with this hardware. We also recognize that this
first feasibility vehicle study does not constitute a production calibration and that additional
development effort would be needed to achieve manufacturer functional objectives for cold
starts. We recognize that significant development efforts are needed to prove out control
strategies and are providing the lead time necessary for these development efforts. However, this
test program demonstrates that in the case of this typical secondary air injection equipped
vehicle, additional emission reduction opportunities exist by activating at cold temperatures the
hardware already employed on the vehicle. The second feasibility vehicle demonstrates
emission reduction opportunities with calibration changes only. For the second feasibility
vehicle, testing was performed using a production calibration which would satisfy driveability
and customer satisfaction requirements. These calibrations are already used in a production
vehicle sold in Europe. Also, the second vehicle was selected because it is a heavier weight
vehicle in the lighter weight class. In both cases, the feasibility testing clearly showed
significant emissions reductions are achievable through calibration alone at cold temperatures.
Given the lead time provided in the final rule, we believe manufacturers have ample time to
further develop calibrations that meet the full range of driveability and customer satisfaction
requirements.
3.1.2 Tailpipe Standards over All Cycles
What Commenters Said:
ControlMSATs Over All Drive Cycles
The New Jersey Department of Environmental Protection (NJDEP) commented that
although it supports adoption of the proposed cold temperature exhaust emission standards, it
believes that EPA must look beyond technologies to reduce emissions during cold start modes to
technologies that reduce MSAT emissions under all driving modes.
Benzene-specific Standards Necessary
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The New York Department of Environmental Conservation (NYDEC) commented that
EPA has not considered tailpipe standards for benzene (or any other mobile source air toxics
such as acetaldehyde and poly cyclic aromatic hydrocarbons) for any class of vehicle or engine in
this rulemaking. NYDEC commented that it believes that EPA depends on the incorrect
assumption that all hydrocarbon species react similarly in catalytic converters and that
regulations targeting hydrocarbons reduce the emissions of all species equally (and based on this
assumption, EPA claims that regulation of vehicle and engine hydrocarbon emissions is
sufficient to control the (non-evaporative) toxic emissions of vehicles and engines). The
commenter stated that it is "well known that different classes of hydrocarbons react at different
rates in catalytic converters." The commenter further stated that it is well documented that
benzene can be produced in automotive catalytic converters. The commenter stated that it can
find no evidence that EPA even acknowledges the fact that catalytic converters can make
benzene, much less considered it in developing this rule. The commenter then noted that it
conducted its own study to evaluate the production of benzene in catalytic converters, using a
2005 passenger car from its own fleet and sampling and analytical methods adapted from EPA's
Photochemical Assessment Monitoring Stations (PAMS) program. The commenter noted that
exhaust was sampled before and after the main catalytic converter, which is not exactly the
situation tested in the literature (because their test vehicle was equipped with more recent
technology, specifically close-coupled pre-catalysts upstream of both sample locations; thus, the
before-catalyst sample is not engine-out). In its comments, the commenter provided detailed
information on how the study was performed, assumptions made, and the results of the study.
Lastly, the NYDEC commented that EPA cannot simply assume that other programs will
protect the public from tailpipe benzene emissions. The commenter further commented that EPA
cannot meet the mandate of section 202(1)(2) of the Clean Air Act (which requires EPA to
regulate benzene emissions to obtain the "greatest degree of emissions reduction achievable")
without any analysis, particularly when existing emissions control devices (catalytic converters)
produce additional benzene under common operating conditions. The commenter believes that
explicit tailpipe benzene standards must be promulgated.
Letters:
New Jersey Department of Environmental Protection (NJ DEP) OAR-2005-0036-0829
New York State Department of Environmental Conservation (NY DEC) OAR-2005-0036-
0722
Our Response:
We believe that NMHC standards are an effective method of significantly reducing
benzene and many air toxics levels in the exhaust as supported by the MSAT EPA test programs
(see Regulatory Impact Analysis, Chapter 5). These programs confirmed that under the current
cold start emission drive cycles, benzene levels closely correlate with NMHC levels and a
reduction in NMHC will result in proportional reductions in benzene and other toxics. All
current data suggests that the overwhelming majority of toxics from Tier 2 vehicles are emitted
immediately following the cold start. While commenters suggested that toxics are also created
or released during other operating modes, data is limited, especially for Tier 2 vehicles regarding
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toxics formation across the catalyst during specific operating conditions (i.e., rich hot operation).
Additionally, the areas of operation described in the comments where formation is expected to
occur (i.e., over 81 miles per hour) represent a small fraction of vehicle miles traveled(VMT).
As indicated by the commenter, toxics formation in the engine and catalytic converter is a
complicated issue that can be influenced by many factors not yet fully understood. The limited
data provided by the commenter warrants further investigation to determine the mechanisms for
benzene formation. However, we must evaluate the issue in the context of SFTP compliant Tier
2 vehicles, which will likely perform differently than the older vehicles included in the test data
referenced by the commenter. Further, the operating conditions that result in possible toxics
formation may not be demonstrated in current test procedures, thus requiring investigation
beyond the current test cycles (e.g., operation at sustained high-loads even more severe than
US06 cycle). Therefore, an assessment of tailpipe benzene emissions would need to be
accompanied by an evaluation of the drive-cycle conditions that generates the conditions for
benzene formation. Thus, we plan to undertake a more in-depth investigation to understand the
potential mechanisms for toxics formation and the vehicle operating conditions under which such
toxics may be formed.
3.1.2.1 PM-specific Standards
What Commenters Said:
The ALA, NESCAUM, and the NJDEP commented that there is a need for the
establishment of paniculate standards for gasoline passenger vehicles.
The Alliance commented that in addition to hydrocarbon reductions, it believes that the
Agency provided considerable discussion on the co-benefits of paniculate matter (PM) and
ozone reductions. The Alliance commented that it agrees that PM emissions from mobile
sources have steadily decreased as manufacturers comply with stringent federal exhaust emission
standards. Additionally, the commenter stated that the proposed vehicle regulations should
directionally reduce PM emissions from Tier 2 vehicles. Furthermore, the commenter believes
that the reduction in volatile organic compounds (VOCs) will reduce the potential for secondary
atmospheric formation of fine PM. However, the commenter stated that even though PM will be
directionally reduced, it does not believe that PM from Tier 2 vehicles is an issue at the cold
temperature conditions which are the subject of this proposed rulemaking. The commenter noted
a feasibility study that EPA commissioned and stated that, according to the study, PM averages
for all of the vehicles tested at 20°F were at or below the existing 75°F certification standards.
The commenter believes that this indicates that PM is currently controlled adequately at cold
temperatures, and with the proposed hydrocarbon standards leading to potential further decreases
in PM, it would be inappropriate for EPA to consider the regulation of PM at cold temperatures.
Letters:
Alliance of Automobile Manufacturers (Alliance) OAR-2005-0036-0881
American Lung Association (ALA) OAR-2005-0036-0365
New Jersey Department of Environmental Protection (NJ DEP) OAR-2005-0036-0829
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Northeast States for Coordinated Air Use Management (NESCAUM) OAR-2005-0036-
0993,-0369
Our Response:
Our findings regarding PM levels during colder operation indicated that temperature
appears to be an important factor for direct PM, similar to NMHC findings. While the PM
averages for all of the vehicles tested at 20°F were at or below the existing 75°F certification
standards, the levels were unexpectedly high compared with PM emissions at 75°F and these
relatively low mileage vehicles were approaching or exceeding the Tier 2 PM standards. The
cold temperature vehicle standards are being established to control MSATs under CAA 202(1)
and PM reductions are a coincidental benefit. We will continue to fully investigate direct PM
from gasoline engines, including the possible need for future cold PM standards as well as PM
control under other operating modes.
3.1.2.2 Standards Do Not Account For Testing Requirements in Fuel Economy Label
Standard
What Commenters Said:
The commenter noted that the proposed heater/defroster change to the fuel economy
labeling requirements is a major change and will impact the existing Cold CO standards, the
proposed 20°F NMHC standards, and the proposed Fuel Economy Labeling procedures. The
commenter further stated that this test procedure change would be most appropriately addressed
as a separate rulemaking initiated only after more extensive research is completed. The
commenter believes that EPA needs to take into consideration the effect of heater/defroster
activation on the 20°F NMHC standards proposed in the MSAT rule, and defer any test
procedure changes until a thorough analysis of heater and/or defroster use and related emission
impacts has been performed. The Alliance noted that the data EPA collected come from EPA's
two feasibility studies, one conducted internally and the other conducted by Southwest Research
Institute (SwRI), and that these two studies show conflicting results. The commenter noted that
SwRI's results on the gasoline vehicle demonstrate a decrease in hydrocarbon emissions with
heater/defroster use, while the Agency's in-house study shows an increase; thus, the commenter
believes that more extensive study of this issue is needed.
Letters:
Alliance of Automobile Manufacturers (Alliance), OAR-2005-0036-0881
American Lung Association (ALA), OAR-2005-0036-0365
New York Department of Environmental Conservation, OAR-2005-0036-0722
New Jersey Department of Environmental Protection, Division of Air Quality, OAR-2005-0036-
0829
Our Response:
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Regarding new testing requirements under the Fuel Economy (FE) Labeling final rule,
we do not believe there are any emissions issues related to use of the heater/defroster during the
cold FTP test.l In the FE rule, we specifically structured the heater/defroster protocol to reflect
real-world operation, (i.e., delay heater/defroster operation until 2 minutes into the test) which
also has the effect of mitigating any emissions impact during start-up. EPA testing, including a
vehicle feasibility demonstration (see Chapter 5, section 5.1.2.2, of the RIA) which followed the
protocol, indicates that emission levels are not affected by the new testing requirements.
Nevertheless, the FE rule gives manufacturers until the 2011 model year before heater/defroster
use is required. We believe this allows sufficient lead time to investigate any potential emissions
impacts.
3.1.3 Harmonizing with California LEV II Standards
What Commenters Said:
Harmonize with California LEVII
NESCAUM commented that California has finalized more stringent tailpipe HC
emissions standards that EPA could adopt nationally.
The NJDEP commented that technologies exist today and are being utilized by
automobile manufacturers for compliance with California's Low Emission Vehicle II (LEV II)
exhaust and evaporative emission standards that reduce MSAT emissions under all driving
modes. NJ DEP believes that EPA should consider adoption of exhaust and evaporative
emission standards equivalent to or beyond California's Low Emission Vehicle (LEV) II
standards.
The NJDEP also commented that it does not believe that Tier 2 exhaust and evaporative
emission standards represent the greatest emission reductions achievable. EPA should consider
adoption of exhaust and evaporative emission standards equivalent to or beyond the LEV II
standards. For example, the Partial Zero Emission Vehicle (PZEV) and Advanced Technology
PZEV (ATPZEV) exhaust and zero evaporative emission standards would achieve significant
MSAT emission reductions beyond the lowest emitting of the federal Tier-2 emission standards.
NESCAUM has estimated the LEV II exhaust and evaporative emission standards would yield a
23% reduction in air toxic emissions (benzene, 1,3 butadiene, formaldehyde and acetaldehyde
were included in the analysis), on average for the states of New York, Massachusetts, and
Vermont (states that had adopted the LEV program at the time of the study) relative to the
federal Tier 2 evaporative and exhaust emission standards (Source: "California Low Emission
Vehicle Program in the Northeast, NESCAUM, March, 2004).
The NJDEP commented that the MSAT reduction benefits can be attributed to several of
the key requirements of the LEV II program including: the LEV II program's declining non-
1 "Fuel Economy Labeling of Motor Vehicles; Revisions to Improve Calculation of Fuel Economy
Estimates," Final Rule, 71 FR 77872, December 27, 2006.
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methane organic gas (NMOG) fleet average requirement; the PZEV, ATPZEV and ZEV exhaust
emission standards and durability requirements; and the zero evaporative emission standard
applicable to PZEVs and ATPZEVs.
The NJDEP also commented that New Jersey has adopted the LEV standards for vehicles
delivered for sale in New Jersey on and after January 1, 2009. EPA should consider adoption of
analogous exhaust and evaporative emission standards on a national basis to achieve additional
MSAT reductions beyond those resulting from the proposed cold temperature emission
standards. Such harmonization with California's most stringent emission standards would also
simplify compliance for the automobile manufacturers with the vehicle emission standards
across the nation.
Do Not Harmonize with California LEVII
The Alliance commented that the Tier 2 program provides comprehensive and extensive
emissions reductions from mobile sources and noted that these standards have yet to fully phase-
in and the fleet has yet to turn over for these vehicles. The commenter believes that setting more
stringent Tier 2 NMOG standards, such as those adopted by California in its LEV II programs,
would not provide any meaningful emissions benefits. The commenter believes that Tier 2
emission standards, in conjunction with the proposed 20°F NMHC standards and LEV II
evaporative standards, will reduce further the inventory differences between programs. The
Alliance commented that it maintains support of the federal Tier 2 program and the large
emission benefits it affords. Lastly, the commenter stated that, for the reasons EPA cited in the
preamble, coupled with the fact that LEV II provides no meaningful reductions compared to Tier
2, it agrees with EPA's conclusion that no changes should be made to the Tier 2 program.
Letters:
NESCAUM OAR-2005-0036-0993
Alliance of Automobile Manufacturers (Alliance) OAR-2005-0036-0881
New Jersey Department of Environmental Protection, Division of Air Quality (NJDEP) OAR-
2005-0036-0829
Our Response:
We continue to believe, for reasons discussed below, that it would not be appropriate to
adopt more stringent tailpipe standards under normal test conditions beyond those contained in
Tier 2. It is possible that a future evaluation could result in EPA reconsidering the option of
harmonizing the Tier 2 program with California's LEV-II program or otherwise seeking
emission reductions beyond those of the Tier 2 program and those being finalized today.2
Section 202(1)(2) requires EPA to adopt regulations that contain standards which reflect
the greatest degree of emissions reductions achievable through the application of technology that
will be available, taking into consideration existing motor vehicle standards, the availability and
2 See Sierra Club v. EPA. 325 F. 3d at 380 (EPA can reasonably determine that no further reductions in
MSATs are presently achievable due to uncertainties created by other recently promulgated regulatory provisions
applicable to the same vehicles).
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costs of the technology, and noise, energy and safety factors. The cold temperature NMHC
program finalized today is appropriate under section 202(1)(2) as a near-term control: that is, a
control that can be implemented relatively soon and without disruption to the existing vehicle
emissions control program. We did not propose additional long-term controls (i.e., controls that
require longer lead time to implement) because we lack the information necessary to assess their
appropriateness. We believe it will be important to address the appropriateness of further MSAT
controls in the context of compliance with other significant vehicle emissions regulations
(discussed below).
In the late 1990's both the EPA and the California Air Resources Board finalized new
and technologically challenging light-duty vehicle/truck emission control programs. The EPA
Tier 2 program focuses on reducing NOx emissions from the light-duty fleet. In contrast, the
California LEV-II program focuses primarily on reducing hydrocarbons by tightening the light-
duty NMOG standards.3 Both programs will require the use of hardware and emission control
strategies not used in the fleet under previously existing programs. Both programs will achieve
significant reductions in emissions. Taken as a whole, the Tier 2 program presents the
manufacturers with significant engineering challenges in the coming years. Manufacturers must
bring essentially all passenger vehicles under the same emission control program regardless of
their size, weight, and application. The Tier 2 program represents a comprehensive, integrated
package of exhaust, evaporative, and fuel quality standards which will achieve significant
reductions in NMHC, NOx, and PM emissions from all light-duty vehicles in the program.
These reductions will include significant reductions in MSATs. Emission control in the Tier 2
program will be based on the widespread implementation of advanced catalyst and related
control system technology. The standards are very stringent and will require manufacturers to
make full use of nearly all available emission control technologies.
Today, the Tier 2 program remains in its phase-in. Cars and lighter trucks will be fully
phased into the program with the 2007 model year, and the heavier trucks won't be fully entered
into the program until the 2009 model year. Even though the lighter vehicles will be fully
phased in by 2007, we expect the characteristics of this segment of the fleet to remain in a state
of transition at least through 2009, because manufacturers will be making adjustments to their
fleets as the larger trucks phase in. The Tier 2 program is designed to enable vehicles certified to
the LEV-II program to cross over to the federal Tier 2 program. At this point in time, however,
it is difficult to predict the degree to which this will occur. The fleet-wide NMOG levels of the
Tier 2 program will ultimately be affected by the manner in which LEV-II vehicles are certified
within the Tier 2 bin structure, and vice versa. We intend to carefully assess these two programs
as they evolve and periodically evaluate the relative emission reductions and the integration of
the two programs.
Today's final rule addresses toxics emissions from vehicles operating at cold
temperatures. The technology to achieve these new standards is already available and we project
that compliance will not be costly. However, we do not believe that we could reasonably
propose further controls at this time. There is enough uncertainty regarding the interaction of
3 NMOG includes emissions of nonmethane hydrocarbons plus all other nonmethane organic air pollutants
(for example, aldehydes), which are ozone precursors. For gasoline and diesel vehicles, NMHC and NMOG
emissions levels are very similar.
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the Tier 2 and LEV-II programs to make it difficult to evaluate today what might be achievable
in the future. Depending on the assumptions one makes, the LEV-II and Tier 2 programs may
or may not achieve very similar NMOG emission levels. Therefore, the eventual Tier 2 baseline
technologies and emissions upon which new standards would necessarily be based are not known
today. Additionally, we believe it is important for manufacturers to focus in the near term on
developing and implementing robust technological responses to the Tier 2 program without the
distraction or disruption that could result from changing the program in the midst of its phase-in.
We believe that it may be feasible in the longer term to seek additional emission reductions from
the base Tier 2 program, and the next several years will allow an evaluation based on facts rather
than assumptions.
Additionally, adopting the LEV II emission standards would likely not result in
reductions in MSAT emissions under all driving modes, contrary to the commenter's assertion.
As evidenced by the need to adopt cold temperature standards, emission controls on vehicles
certified to stringent levels at 75° F may not guarantee proportional reductions at all driving
conditions. LEVII standards do not contain requirements below 50°F. The past SFTP
rulemaking resulted in standards that were established to address unique driving conditions that
were not captured with a more stringent 75° F standard. As such, establishing emission standards
for other driving modes, including cold temperature, as we have done in this rule, will result in
the largest reductions in MSAT emissions.
The summary and analysis of comments concerning harmonizing with the evaporative
standards of LEVII is contained in section 3.2 below.
3.1.4 Timing and Phase-in
What Commenters Said:
Timing Should Be Accelerated
NESCAUM commented that, given the fact that the controls require only calibration and
software changes and not hardware changes, they encourage EPA to establish an earlier program
start date than the dates proposed.
Timing and Phase-In Are Appropriate
The Alliance commented that the relative stringency of 20°F NMHC standards will
increase incremental development workload and facility needs exponentially. The commenter
stated that an appropriate phase-in approach is critical to avoid a front-loaded phase-in or one of
short duration, which could further magnify the workload burden in the short-term; the
commenter believes that even the current proposed phase-in creates a significant impact on
facility capacity needs over a relatively short time period, affecting each manufacturer to a
different degree. The commenter also stated that a manufacturer's testing capacity should be
utilized steadily in order to prevent "vacant/orphan" facilities at end of phase-in; an aggressive
phase-in requirement would create an unnecessary cost burden for manufacturers. The
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commenter further stated that the proposed rule recognizes these cost issues and provides
sufficient mechanisms for phase-in flexibility in an attempt to partially mitigate these costs.
The Alternative Phase-In Requires More Flexibility
The Alliance noted that the alternative phase-in program outlined by the Agency in this
rulemaking emphasizes the ability to bring in additional products meeting the 20°F NMHC
standard under accelerated timing, and that the alternative phase-in schedules are especially
attractive for the flexibility afforded the manufacturer. However, the Alliance commented that
the additional stipulation regarding the initial years of product phase-in significantly curtails the
necessary flexibility. Further, the Alliance stated, even if a manufacturer introduces a significant
volume of products meeting this standard early, in 2008 and 2009, there is a possibility of debit
generation as early as 2010 despite accelerated compliance efforts on the part of the
manufacturer. To avoid limiting the flexibility of its alternative phase-in program and
diminishing the incentive to strive for early compliance, the Alliance recommends that EPA
amend the proposal and fully align with the alternative phase-in schedule as outlined in Title 13,
California (CA) code of Regulations Section 1961 (b)(2) without additional constraints (which
effectively eliminates any "early-year" phase-in requirements of an alternative phase-in).
Nissan Motor Company, Ltd (Nissan) commented that it understands EPA's desire to
reduce mobile source air toxics (MS AT), and that several elements of the proposed MS AT rule
can be implemented within the timetable set forth in the proposed rule. However, the commenter
believes that the proposals for regulating vehicle tailpipe NMHC at low temperatures appear to
require powertrain hardware changes and increased development and laboratory facility burden
that cannot be accommodated within the time-table in the NPRM.
In its comments, Nissan suggested a modification to the phase-in provisions for
HLDT/MDPV which it believes could produce a demonstrable benefit for EPA. The commenter
believes that the purported relief offered by the phase-in schedule of 25%/50%/75%/100% is not
useable or effective for any manufacturer of a narrow range of HLDT/MDPV engines and truck
lines; the commenter believes that the three intermediate phase-in rates mentioned in the
proposed rule offer no actual leveling of burden.
Nissan commented that it currently has only one engine configuration (5.6L V8) and only
one vehicle platform in the HLDT/MDPV class, and that such a structure means the
manufacturer could implement at only one rate (i.e., 100%). The commenter noted that it plans
to pull-ahead its full implementation date to model year 2013; the second year of the phase-in.
The commenter believes that its targeted 0%/100%/100%/100% phase-in schedule would
provide a significant incremental environmental benefit. However, it believes that another
provision in the proposed rule inhibits its ability to deliver that benefit; the provision that states
"In addition, manufacturers electing to use an alternate phase-in schedule & must ensure that the
sum of products is at least 100% for model years and 2012 and earlier for HLDT/MDPVs." The
commenter notes that even though it plans to fully (100%) implement low temperature control
for HLDT/MDPV in 2013 (when the phase-in requirement is only 50%) the "sum of products
and at least 100%" provision obviates its early full implementation schedule and eliminates a net
benefit from its early full implementation. The commenter thinks that the provision could be
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improved, to create mutual benefits, in the following ways:
A. In § 86.181 l-10(g)(4)(ii), EPA could simply eliminate the "sum of products ... at
least 100% provision, or
B. In §86.1811-10(g)(4)(ii), EPA could modify the "sum of products ... at least 100%
requirement to apply to 2013 and earlier, or
C. In §86.181 l-10(g)(4)(ii), EPA could allow manufacturers to begin
implementation on any schedule that produces a net benefit to EPA, which would
be validated by the manufacturer exceeding the "500% phase-in product"
requirement for the phase-in period (for example, 525% total), or
D. EPA could move implementation of the low temperature requirement to the 2013
model year for HLDT/MDPV.
Nissan commented that its "Proposal C" above would create flexibility only in the first
year of the phase-in schedule while requiring much higher implementation rates in years 2 and 3,
and would also pull-ahead 100% compliance by one model year. The commenter stated that this
net benefit would also attenuate burden for manufacturers of narrow HLDT/MDPV offerings
which is the original intent of the phase-in provision.
Nissan also commented that it believes that the proposed implementation time-table and
the inflexibility of the proposed phase-in rules will cause a short-term spike in its facilities
development and testing burden. The commenter does not believe that forced investment to
cover this transitory spike is an efficient use of limited capital and resources, and suggests the
following modifications to the MS AT program:
A. Modify the phase-in compliance calculation method as discussed in l.C above,
and
B. Modify the less-than 100% phase in period from 3 years to 4 years. For example,
adopt a nominal phase-in of 20%/40%/60%/80%/100%.
The commenter believes that taken together, these two steps can significantly smooth the burden
on facilities, development and testing resources and provide for more efficient implementation.
Mitsubishi Motors (Mitsubishi) commented that it is an Intermediate Volume
Manufacturer, and as such has a limited number of vehicle lines and therefore the percentage that
needs to be phased-in for a given year affects a much larger portion of their product offerings.
The commenter stated that this leads to challenges where it could become very costly and quite
difficult to complete enough development work fast enough for compliance (and notes that a
large increase in the workload would result in facility expenses proportionately greater than
those of the full line manufacturers). The commenter stated that it agrees with the AAM facility
expense calculations, except that real estate costs are much higher at their research and
development facility in Japan. Therefore, the commenter stated, merely finding a location and
constructing such a facility will be very costly and time consuming, and will significantly delay
its ability to effectively implement the major vehicle redesign required to meet the proposed
standard. Mitsubishi concluded by stating that it believes that additional phase-in time should be
allowed to provide enough time to construct new development facilities.
Letters:
Alliance of Automobile Manufacturers (Alliance), OAR-2005-0036-0881
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Mitsubishi Motors R&D of America (Mitsubishi), OAR-2005-0036-0882
NESCAUM, OAR-2005-0036-0993
Nissan Technical Center North America (Nissan), OAR-2005-0036-0825
Our Response:
We believe that the finalized start date and phase-in schedule will achieve the greatest
amount of emissions reductions in the shortest feasible amount of time. EPA must consider lead
time in determining the greatest degree of emission reduction achievable under section 202(1) of
the Clean Air Act. Also, for vehicles above 6,000 GVWR, section 202(a) of the Act requires
that four years of lead time be provided to manufacturers. We believe that lead time and a
phase-in schedule is needed to allow manufacturers to develop compliant vehicles without
significant disruptions in the product development cycles. The three-year period between
completion of the Tier 2 phase-in and the start of the new cold NMHC standard should provide
vehicle manufacturers sufficient lead time to design their compliance strategies and to determine
the product development plans necessary to meet the new standards.
We recognize that the new cold temperature standards we are finalizing could represent a
significant new challenge for manufacturers and development time will be needed. The issue of
NMHC control at cold temperatures was not anticipated by many entities, and research and
development to address the issue is consequently at a rudimentary stage. Lead time is therefore
necessary before requiring compliance to be demonstrated. While certification will only require
one vehicle model of a durability group to be tested, manufacturers must do development on all
vehicle combinations to ensure full compliance within the durability test group. A phase-in is
needed because manufacturers must develop control strategies for several vehicle lines. Since
manufacturers cannot be expected to implement the standard over their entire product line in
2010, we believe a phase-in allows the program to begin sooner than would otherwise be
feasible.
The lead time and phase-in are also needed to address facilities issues. Manufacturers
raised concerns that a rapid phase-in schedule would lead to a significant increase in the demand
for their cold testing facilities, which could necessitate substantial capital investment in new cold
test facilities to meet development needs. This is because manufacturers would need to use their
cold testing facilities not only for certification but also for vehicle development. Durability test
groups may be large and diverse and therefore require significant development effort and cold
test facility usage for each model. If vehicle development is compressed into a narrow time
window, significant numbers of new facilities would be needed. Manufacturers were also
concerned that investment in new test facilities would be stranded at the completion of the initial
development and phase-in period.
We took these concerns into consideration when drafting our proposed rule and are
finalizing the start date and phase-in as proposed because we continue to believe they address
these issues adequately. Our finalized phase-in period accommodates test facilities and work
load concerns by distributing these fleet phase-in percentage requirements over a four-year
period for each vehicle weight category (six years total). The staggered start dates for the phase-
in schedule between the two weight categories should further alleviate manufacturers' burden
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regarding construction of new test facilities. We recognize that some manufacturers may still
determine that upgrades to their current cold facility are needed to handle increased workload, or
that additional shifts must be added to their facility work schedules that are not in place today.
The lead time and the four-year phase-in period provide needed time for vehicle manufacturers
to develop a compliance schedule that does not significantly interfere with their future product
plans.
We have revised the terms of the optional alternative phase-in, in response to public
comment. We proposed alternative phase-in schedules for both the LDV/LLDT and
HLDT/MDPV weight categories to provide manufacturer flexibility and to encourage early
emissions benefits. These alternative schedules included "early-year" provisions to ensure an
adequate number of vehicles achieved compliance during the initial years of an alternative
phase-in. Specifically, a manufacturer who adopts an alternative phase-in must ensure that the
"Anticipated Phase-In x Year" factors in the alternative phase-in equation sum to at least 100%
for 2010 and earlier model year LDV/LLDTs, and 2012 and earlier model year HLDT/MDPVs.
Commenters were concerned these provisions would create significant hardship, especially for
limited-line manufacturers who produce only a narrow range of car lines. (For example, a
manufacturer who only sells one configuration in the HLDT/MDPV category would not have the
option of certifying only 25% of these vehicles in 2012. To meet our proposed criteria, that
manufacturer would have to ensure that the model is fully compliant in 2013; i.e., 100% of their
HLDTs/MDPVs. This would eliminate any flexibility for these manufacturers, as noted in
comments.
To address these legitimate concerns, we are providing an option that would eliminate the
early-year provision for HLDT/MDPV manufacturers as long as their full phase-in is
accelerated. As proposed, manufacturers may still apply for an alternative phase-in option in
which the equation sum to at least 500%, including an "early-year" provision meeting 100%
criteria. However, in response to comments, we are also allowing another alternative phase-in
option in which the equation must be at least 600% for HLDTs/MDPVs, without any early-year
provision. We believe this will still yield environmental benefits as quickly as possible, while
not putting an unreasonable burden on limited-line manufacturers of HLDTs/MDPVs.
Manufacturers with limited HLDT/MDPV product offerings will still achieve 100 percent phase-
in of the HLDTs/MDPVs before the end of the phase-in schedule in 2015.
Regarding the early-year provisions for LDV/LLDTs, we believe that the proposed early-
year requirements provide emissions benefits without unreasonably burdening manufacturers
who elect to adopt an alternative phase-in. Manufactures of LDV/LLDTs typically produce a
wider variety of configurations in the lower weight category than in the HLDT/MDPV category,
thus have more flexibility within the LDV/LLDT category to meet a fleet-average standard.
Furthermore, LDV/LLDTs as a group face fewer technological hurdles as do the heavier
vehicles. Therefore, we will retain the early year requirements for the alternative phase-in for
LDV/LLDTs.
3.1.5 Credits
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3.1.5.1 Use of Credits
What Commenters Said:
ALA commented that it opposes the use of credits generated by over-compliance by a
manufacturer in one weight class toward meeting a manufacturer's obligation in a heavier or
lighter weight class.
The Alliance commented that the availability of credits for early or accelerated efforts to
introduce compliant vehicles provides a mechanism for manufacturers to offer products meeting
the 20°F NMHC standard earlier than mandatory and allows customers the opportunity to
purchase these vehicles, and that this alternative phase-in structure allowed for early vehicle
introduction under both the Tier 2 and California's LEV II programs.
Letters:
American Lung Association (ALA) OAR-2005-0036-0365
Alliance of Automobile Manufacturers (Alliance) OAR-2005-0036-0881
Our Response:
EPA views the use of credits generated in one weight class toward meeting obligations in
a different weight class, and the other averaging, banking, and trading (ABT) provisions, as
important elements in setting emission standards reflecting the greatest degree of emission
reduction achievable, considering factors including cost and lead time. If there are vehicles that
will be particularly costly or have a particular challenge coming into compliance with the
standard, the ABT program allows a manufacturer to adjust the compliance schedule
accordingly, without special delays or exceptions having to be written into the rule. This is an
important flexibility especially given the current uncertainty regarding optimal technology
strategies for any given vehicle line. In addition, ABT allows us to consider a more stringent
emission standard than might otherwise be achievable under the Clean Air Act, since ABT
reduces the cost and improves the technological feasibility of achieving the standard. By
enhancing the technological feasibility and cost-effectiveness of the new standard, ABT allows
the standard to be attainable earlier than might otherwise be possible.
3.1.5.2 Credits from a Voluntary HDV Program
What Commenters Said:
ALA commented that it opposes the creation of NMHC credits applicable to other
vehicle categories from reductions achieved by HDVs.
Letters:
American Lung Association OAR-2005-0036-0365
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Our Response:
Our proposal sought comment on voluntary approaches where manufacturers could earn
credits by including heavy-duty gasoline vehicles in the program. The ALA's was the only
comment responding to this solicitation. Due to insufficient data on such a program's
ramifications, as well as the lack of support, we are not including a heavy-duty standard or credit
program at this time.
3.1.5.3 Credits and the Family Emission Limit (FEL) Structure
What Commenters Said:
The Association of International Automobile Manufacturers commented that it supports
EPA providing the provision that allows manufacturers to optionally certify using Family
Emission Limits; however, as described in the proposal, rounding would be required to one
decimal place, which would significantly limit manufacturers' ability to use FELs and make it
very difficult to earn credits. The commenter recommends that EPA instead allow rounding to
two decimal places in order to allow the flexibility which the commenter believes EPA intended
with this provision.
Letters:
Association of International Automobile Manufacturers (AIAM) OAR-2005-0036-0973
Our Response:
We believe that rounding FELs to one decimal place is consistent with the one-decimal
place standard, simplifies calculations, and will neither help nor hinder the generation of credits.
The net effect of rounding the FEL to one decimal place is that some test groups may round
down to the FEL, thus promoting the generation of credits. Conversely, some test groups may
have to round up to the next FEL, thus potentially limiting credit generation.
3.1.5.4 Cold NMCH Credits and the Tier II Program
What Commenters Said:
ALA commented that it opposes the use of cold NMHC credits to offset deficits in
compliance with any portion of the Tier II requirements.
Letters:
American Lung Association OAR-2005-0036-0365
Our Response:
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With regard to cold NMHC credits, EPA does not support the use of these credits to
offset Tier II compliance deficits, and in fact specifically prohibited in the proposed regulations
the use of cold NMHC credits to offset any deficits other than those generated with respect to the
cold NMHC standard [§86.1864-10(o)(7)(i)]. The cold NMHC and Tier 2 programs will operate
independently of one another in terms of both FEL and credit determination. These provisions
are not changing for the final rule, and we will therefore maintain the prohibition of using cold
NMHC credits for any other program.
3.1.6 Vehicle Applicability
What Commenters Said:
Proposal Captures Appropriate Vehicles
The Alliance commented that gasoline vehicles account for the vast majority of vehicle
miles traveled in the light duty fleet, and it believes that EPA has appropriately focused its 20°F
standards on gasoline-fueled vehicles. The commenter noted that applying this standard to the
gasoline LDV/LLDT/HLDT/MDPV vehicle classes will capture all but a very small percentage
of the air toxics emissions of the light-duty on-road fleet. In addition, the commenter noted that
there are restrictions on the availability of emissions testing facilities as well as a lack of current
data on which to base a 20°F standard for other classes and categories of vehicles. The
commenter further stated that there currently are no cold temperature test fuel specifications for
diesel or for alternative fuels, nor are there any specified testing procedures established for
alternative fuel vehicles. For all of these reasons, the Alliance stated that it agrees that 20°F
standards should not be established for diesels and alternative fuel vehicles.
International Truck and Engine Corporation (International) commented that it supports
EPA's decision not to establish cold-temperature non-methane hydrocarbon (NMHC) emissions
standards for diesel vehicles. The commenter believes that such standards are unnecessary, as
diesel vehicles meeting current emissions standards already have near-zero NMHC emissions as
a result of recent rulemakings, and that such emissions should not increase appreciably at low
temperatures.
International also commented that even when operated at low temperatures, diesel
vehicles are unlikely to generate elevated hydrocarbon emissions. The commenter specifically
noted that diesel paniculate filters reduce hydrocarbon emissions by physically trapping them so,
unlike the 3-way catalysts used in gasoline engines, there is no temperature threshold that must
be reached in order for such filters to be effective in reducing NMHC emissions. The
commenter stated that as a result, the substantial reductions in NMHC emissions from new diesel
emissions are likely to carry over to operation at cold temperatures.
Proposal Should Apply to Additional Vehicles
ALA commented that the cold NMHC standards must be fuel-neutral. ALA believes that
the following issues must be addressed: application of a cold weather hydrocarbon emissions
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standard to Heavy-Duty passenger vehicles, diesel passenger vehicles, alternative fuel vehicles
and flexible fuel vehicles. The commenter believes that the proposal exempts diesel, alternative
fuel, and flexible fuel vehicles from the cold weather NMHC standards based on a lack of data;
the commenter does not believe that EPA has presented any data to indicate whether the
emissions from these vehicles are higher, lower, or the same as the gasoline vehicle subject to the
proposed regulations. The commenter further stated that it believes that EPA must commit to
exercising its authority to gather the needed data and establishing cold weather NMHC standards
for diesel, alternative fuel vehicles and flex-fuel vehicles (FFVs) or explain why such standards
are not needed; and further stated that developing standards for both these categories of vehicles
should be a priority. The commenter stated that it sees no technical reason why FFVs would not
be required to certify to the applicable cold NMHC standard for both E-85 and gasoline in the
near future. Lastly, the commenter stated that it believes that EPA should establish cold weather
standards for heavy-duty vehicles (HDVs).
Letters:
Alliance of Automobile Manufacturers (Alliance) OAR-2005-0036-0881
American Lung Association OAR-2005-0036-0365
International Truck and Engine Corporation (International) OAR-2005-0036-0826
Our Response:
A comprehensive assessment of appropriate standards for diesel vehicles will require a
significant amount of investigation and analysis of issues such as feasibility and costs. While we
have significant amounts of data on which to base our final standards for light-duty gasoline
vehicles, we have very little data for light-duty diesels. Currently, diesel vehicles are not subject
to the cold CO standard, so there is very limited data available on diesel cold temperature
emissions. Also, many manufacturers are currently in the process of developing diesel product
offerings and the cold temperature performance of these vehicles cannot yet be evaluated.
There are sound engineering reasons, however, to expect cold NMHC emissions for
diesel vehicles to be as low as or even lower than the finalized standards. This is because diesel
engines operate with leaner air-fuel mixtures compared to gasoline engines. Therefore diesels
have lower engine-out NMHC emissions due to the abundance of oxygen and more complete
combustion. A very limited amount of confidential manufacturer-furnished information is
consistent with this engineering hypothesis. Therefore, at this time, we are not finalizing cold
NMHC standards for light-duty diesel vehicles. We will continue to evaluate data for these
vehicles as they enter the fleet and will reconsider the need for standards. Specifically, we have
finalized cold temperature FTP testing for diesels as part of the Fuel Economy Labeling
rulemaking, including NMHC measurement.4 These testing data will allow us to assess diesel
NMHC certification levels over time. Meanwhile, postponing the promulgation of this cold
temperature NMHC rule would postpone the benefits we can achieve much sooner by limiting
the rule to gasoline vehicles. Therefore, the rule will not apply to diesel vehicles at this time.
4 "Fuel Economy Labeling of Motor Vehicles; Revisions to Improve Calculation of Fuel Economy
Estimates," Final Rule, 71 FR 77872, December 27, 2006.
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In addition, while FFVs are currently required to certify at 20° F while operating on
gasoline, there is no cold testing requirement for these vehicles while operating on the alternative
fuel at 20° F. There are little data upon which to evaluate NMHC emissions when operating on
alternative fuels at cold temperatures. There are also many issues that must be resolved before
we are able to establish a cold temperature standard for FFVs when run on E85 (E70 at cold
temperatures). These include feasibility (i.e., levels that are technically achievable), cost, test
procedures, test fuel specifications and the appropriate form of the standard. For example,
because much of the VOC emissions from FFVs operating on the high ethanol blends at cold
temperatures is unburned ethanol on the start, we may need to consider whether higher NMHC
level would be justified or whether an NMHC minus ethanol standard would have merit. Also,
from a toxics perspective, FFVs operating on E85 will have a different toxics profile due to the
shift in fuel from mostly gasoline composing of different compounds to mostly ethanol, a single
compound.
Between the proposed rule and today's final rule, we conducted an initial emissions
testing program on a limited number of FFVs operated on several blends of gasoline and ethanol
at normal test temperatures and 20° F.5 These vehicles were tested on summer gasoline and E85
under normal test temperatures and on winter gasoline and E706 at 20° F. At 20° F, HC
emissions were significantly higher with E70 fuel than with gasoline, with the HC emissions
largely consisting of unburned ethanol generated during the cold start. The reason for the
elevated HC emission levels is that during cold starts, ethanol, which is an MSAT, does not
readily burn in the combustion chamber due to its higher boiling point (approximately 180° F).
FFVs must start on the gasoline portion of the alternative fuel, which can compose as little as
15% of the alternative fuel. Ethanol emissions are further increased at colder temperatures
because the lower engine start temperature will require an increasing amount of the fuel mixture
to start the vehicle and subsequently more unburned ethanol can escape the combustion process.
However, the testing also indicates significantly lower benzene emission levels for FFVs when
operating on the high ethanol blends. Benzene was approximately 65% lower on E85 and
approximately 30% lower on E70 compared to the levels when run on gasoline. Acetaldehyde
emissions are significantly higher with E85 relative to emissions from gasoline-fueled vehicles,
since it is a byproduct of partial (i.e., incomplete) ethanol combustion. In addition, some other
VOC-based toxics emissions were generally lower with the vehicles running on E85 and E70
compared with gasoline.
Other fuels such as methanol and natural gas pose similar uncertainty. As in the case of
diesels, it will take time to gain an understanding of these other technologies in sufficient detail
to support a rulemaking, which delays the benefits that may be achieved now by limiting the rule
to gasoline vehicles. Therefore, as proposed, we are not finalizing a cold NMHC testing
requirement for FFVs or alternative fuel vehicles under this final rulemaking. We will continue
to investigate these other technologies.
Finally, as with diesel and FFVs, we lack relevant data upon which to establish a cold
5 "Flex Fuel Vehicles (FFVs) VOC/PM Cold Temperature Characterization When Operating on Ethanol
(E10, E70, E85)" February, 2007
6 E70 is a fuel mixture consisting of 70% ethanol and 30% gasoline typical of a winter blend of an ethanol
based alternative fuel.
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NMHC standard HDVs. Also like diesel and FFVs, a comprehensive assessment of appropriate
standards would require a significant amount of investigation and analysis. Such an
investigation of HDVs would postpone the promulgation of this rule, which would postpone the
benefits we can achieve much sooner by limiting the rule to gasoline
LDV/LLDT/HLDT/MDPVs. Therefore, the rule will not include HDVs at this time.
3.1.7 Interim In-Use Standard
What Commenters Said:
Nissan commented that it understands and accepts EPA's desire to phase-out the interim
in-use standards; however, it believes that the 0. Ig/mi increment is insufficient, given the current
(low) level of experience with factors influencing variability of low temperature performance.
The commenter noted a study of some 77°F in-use standards which indicated that a 0.1 gpm
increment may be insufficient to address possible variability during the phase-in years of this
new standard. The commenter offered (as a precedent for such an increment) information
regarding the LEV2-SULEV standard when it was adopted. The commenter noted that it was
accepted that early implementation contains an inherent risk for misestimating factors affecting
in-use variability, so the SULEV rule addressed those factors by setting a higher interim in-use
standard for a limited period of time. Nissan suggests that EPA take a similar approach for this
new low-temperature NMHC standard.
Nissan also commented that the finding of feasibility for the low temperature NMHC
controls tends to be based, in part, on data from low odometer vehicles. The commenter believes
that it may not fully reflect in-use variability at higher odometer. The commenter also stated that
it believes that test data used to assess feasibility may not account for certain emerging
technologies. Nissan believes that an interim in-use standard that does not accommodate these
facts means that manufacturers could be inadvertently penalized for early introduction of the
leading-edge and fuel-saving technology.
Nissan summarized its comments by reiterating its desire that EPA reconsider interim in-
use standards and allow an increment greater than 0.1 gpm for a limited time; stating that it
believes that such a targeted standard could influence the earlier implementation of the standard
for some models. Nissan further stated that if manufacturers are more confident about in-use
compliance, they may be able to pull-ahead some models that would otherwise be delayed
because of concern over the narrow margin of the current in-use standard.
Letters:
Nissan Technical Center North America (Nissan) OAR-2005-0036-0825
Our Response:
We did not receive any data that supported Nissan's assertion, nor any indication of an
acceptable increase beyond the 0.1 g/mi increment. Furthermore, no other manufacturers
commented on this provision. We believe the 0.1 g/mi increment is sufficient and that anything
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greater may result in a reduction of emission control. A larger increment may provide incentive
for manufacturers to starting reducing their compliance margins, which is not the intent of the
provision.
3.1.8 Interaction with Tier 2 Standards
What Commenters Said:
ALA commented that it is not clear whether this compliance structure will conflict or
interfere with compliance of other Tier 2 standards. The ALA added that compliance and
enforceability are made even more complicated by the proposal of an alternative phase-in
schedule. ALA urges EPA to consider this matter more carefully before finalizing the FEL
structure, and the alternative phase-in schedule in the final rule.
Letters:
American Lung Association (ALA) OAR-2005-0036-0365
Our Response:
The cold NMHC and Tier 2 programs will operate independently of one another in terms
of the following: FEL determination for cold NMHC compliance, selection of compliance bins
for Tier 2, credits, compliance, and enforcement. A test group's cold NMHC FEL selected by a
manufacturer for the cold NMHC program will not dictate any specific Tier 2 bin for the same
test group. Conversely, a manufacturer's selection of the Tier 2 bin for a test group will not
determine the FEL established by the manufacturer for cold temperature standard test group.
Credits earned with the ABT program for the cold NMHC program are not interchangeable with
the NOx credits of the Tier 2 program. Because of the independent nature of the programs, the
overlap of the Tier 2 phase-in with the cold NMHC alternative phase-in will not pose
complications in terms of compliance and enforcement.
3.1.9 Intermediate Temperature Control and Determination of Defeat Devices
What Commenters Said:
The Alliance commented that the linear interpolation line used to determine emission
control at ambient temperatures between 25° F and 68° F is inappropriately stringent. EPA
proposed that the guideline for NMHC emission congruity across the intermediate temperature
range be the linear interpolation between the NMHC FEL at 25° F and the Tier 2 NMOG
standard to which the vehicle was certified at 68° F. The Alliance recommended that EPA
develop the linear interpolation based on the FEL "pass limit" at 20° F, instead of the actual FEL
itself.
The Alliance commented it is not appropriate to state that a "vehicle will automatically be
considered to be equipped with a defeat device without further investigation" if the intermediate
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temperature MHC emission level is greater than the 20° F FEL pass limit. The Alliance
provided suggested modified language, and recommended that a similar modification be made
for the corresponding CO language in this section.
Letters:
Alliance of Automobile Manufacturers (Alliance) OAR-2005-0036-0881
Our Response:
Based on the Alliance's comments, we have revised the regulations with respect to cold
NMHC congruity at ambient temperatures between 20° F and 68° F. Instead of basing the linear
interpolation on the FEL at 25° F, we will instead use the FEL "pass limit" at 20° F, per the
Alliance's recommendation. For example, if a test group certifies to an FEL of 0.4 g/mi, then the
linear interpolation would be based on a line drawn from the FEL pass limit of 0.449 g/mi at 20°
F to the applicable Tier 2 NMOG standard at 68° F.
In addition, we have revised the language regarding the presence of a defeat device when
the intermediate temperature NMHC emission level is greater than the 20° F FEL pass limit.
Instead of "automatically" considering such a test result as indicative of a defeat device, the
language will now read ".. .the vehicle will be presumed to have a defeat device unless the
manufacturer provides evidence to EPA's satisfaction that the cause of the test result in question
is not due to a defeat device." Though the Alliance recommended that we apply a similar change
to the language regarding cold CO controls, such a revision is beyond the scope of the present
rulemaking.
3.2 Evaporative Emissions Standards
3.2.1 Level/Feasibility
What Commenters Said:
ALA, in its hearing testimony, commented that it fully supports these proposed standards.
Anchorage commented that it supports the expansion and codification of standards to
reduce these emissions both in ambient air and from vehicles parked in attached garages.
NYDEC commented that it is pleased that EPA has decided to modify the motor vehicle
evaporative standards to harmonize with the California standards. The commenter noted that as
tailpipe emissions continue to decline, evaporative emissions are an ever increasing fraction of
their inventory, and a significant contributor to air toxics; it believes that full harmonization will
benefit air quality, as well as benefiting motor vehicle owners and operators.
WDNR commented that it believes that all vehicles should meet the proposed evaporative
standard for Light Duty Vehicles of 0.5 grams of hydrocarbon on the "3 day diurnal plus hot
soak test" and 0.65 grams of hydrocarbon on the "supplemental 2 day diurnal plus hot soak test."
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STAPPA and ALAPCO commented that they are disappointed that EPA did not propose
to take more meaningful action to address evaporative emissions, such as nationwide adoption of
California's Partial Zero-Emission Vehicle (PZEV) evaporative standards. The commenters
further urged the Agency to commit in the final rule to pursue actions to achieve additional
evaporative emission reductions in the future.
In addition, NESCAUM commented that California has finalized evaporative emissions
standards for PZEVs that are significantly more stringent for light-duty vehicles than the federal
Tier 2 standards, and the California Air Resources Board estimates that the additional per-vehicle
cost for a PZEV evaporative system is approximately $10.2. The commenter believes that EPA
should explore the introduction of a similar standard for some vehicles.
Also, NJDEP commented that EPA should look beyond simply the proposed
harmonization of the Federal evaporative emission standards with California's standards and
consider adoption of California's zero evaporative emission standards (since this harmonization
would only occur for the less stringent of the LEV II program's evaporative emission standards).
The commenter believes that EPA should evaluate adoption of a zero evaporative standard for
federal Tier-2 certified vehicles; noting that the zero evaporative emission standard technology
exists today and is being used on over 35 different models of 2006 model year vehicles certified
under the LEV II program rules (Source- www.cleanvehicles.gov).
The Alliance commented that it supports the Agency's goal of aligning the federal
evaporative standards with the existing LEV II evaporative standards, but noted that field data on
these systems is limited, and ensuring in-use compliance with the LEV II standard over the
broader range of fuels and conditions encountered nationwide will be very challenging. The
commenter noted that granting additional flexibility to implement these requirements will ensure
the earliest implementation of the proposed requirements; the commenter further noted that
meeting the LEV II evaporative standards can be achieved more effectively if greater flexibility
in the certification process is provided to manufacturers (which would allow the option to use
either California or Federal test procedures for evaporative certification purposes). The
commenter also stated that the ability to complete development and certification is critically
dependent upon the flexibility both EPA and California provide in evaporative testing, and
therefore recommends EPA allow certification compliance to LEV II standards through either
Federal or California evaporative testing procedures without pre-approval.
The Alliance commented that it agrees with EPA's conclusion that it would be
inappropriate to propose tighter evaporative emission standards than the LEV II standards at this
time. The commenter noted that PZEVs have been limited to a small fraction of the car and
light-duty truck fleet, has not been proven feasible across the light-duty fleet, it is significantly
more costly to meet the PZEV evaporative emission standard due to the significant changes
needed to the evaporative emission control system and the fuel system, and the emission benefits
of the PZEV evaporative emission standard are minimal.
Lotus Engineering expressed that it has in its client base some very small vehicle
manufacturers, with sales less than a 100 total vehicles and 50 vehicles per year in the U.S.
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Some of these small volume manufacturers (SVMs) want to introduce models into the 45 states
in the U.S. subject to EPA Tier 2 standards, and delay the introduction of models into the LEV II
states. The difference in the Tier 2 to LEV II standards is almost a 50 percent reduction, and this
difference is further exacerbated by an increased assigned deterioration factor (DF) from
California — increased stringency of 36 percent for the 2-day test and 70 percent for the 3-day
test (compared to those assigned DFs from EPA).
In addition, Lotus Engineering indicated that large manufacturers have the resources to
test and demonstrate their own fleet DFs. Even accepting that these fleets have both steel and
plastic tanks, the large manufacturers have successfully demonstrated 0 gram DFs. The SVMs
do not have this opportunity, and if the proposed harmonization of the Tier 2 and LEV II
evaporative emission standards were to be established, SVMs would need a less aggressive
assigned DF. SVMs should benefit from an assumption of a 0 DF unless there are technical
reasons to suggest otherwise.
Letters:
Alliance of Automobile Manufacturers (Alliance) OAR-2005-0036-0881
American Lung Association OAR-2005-0036-0365
Lotus Engineering OAR-2005-0036-1033
Municipality of Anchorage, Department of Health and Human Services (Anchorage) OAR-
2005-0036-0976
NESCAUM OAR-2005-0036-0993
New Jersey Department of Environmental Protection, Division of Air Quality (NJDEP) OAR-
2005-0036-0829
New York Department of Environmental Conservation (NYDEC) OAR-2005-0036-0722
STAPPA/ALAPCO OAR-2005-0036-0836
Wisconsin Department of Natural Resources, Bureau of Air Management (WDNR) OAR-
2005-0036-0828
Our Response:
Comments expressed by ALA, Anchorage, NYDEC, WDNR, and the Alliance support
the adoption of the new evaporative emission standards, which harmonize with California's LEV
II standards. Vehicles sold in all 50 states will now be required to meet the same numeric
standard. However, we believe the LEV II standards were essentially equivalent to the current
Tier 2 standards because of differences in testing requirements between the two programs (see
section V.C.5 in the rule, Existing Differences Between California and Federal Evaporative
Emission Test Procedures), and thus, vehicles contain the same evaporative emission control
hardware for the two programs. (As discussed in the rule, this view is supported by
manufacturers and by current industry practices.) We expect that manufacturers will continue to
produce 50-state evaporative systems, and this rule will codify (i.e., lock in) the approach
manufacturers have already indicated they are taking for 50-state evaporative systems.
In regard to the STAPPA/ALAPCO, NESCAUM, NJDEP, and Alliance comments
related to more stringent evaporative standards (or California's PZEV evaporative emissions
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standards), we have decided not to set more stringent PZEV-equivalent evaporative standards at
this time. The limited PZEV vehicles available today require additional evaporative emissions
technology or hardware (e.g., modifications to fuel tank and secondary canister) beyond what
will be needed for vehicles meeting the new standards that we are adopting today. As we
described in the proposed rule, at this time, we need to better understand the evaporative system
modifications (i.e., technology, costs, lead time, etc.) potentially needed across the vehicle fleet
to meet PZEV-level standards before we can fully evaluate whether it is feasible to consider
more stringent standards. For example, at this point we cannot determine whether the PZEV
technologies could be used fleet-wide or on only a limited set of vehicles. Thus, in the near
term, we lack any of the information necessary to determine if further reductions are feasible,
and if they could be achievable considering cost, energy and safety issues. Moreover, sufficient
new information or data was not provided from commenters on the proposed rule to close these
gaps in our understanding. However, we intend to consider more stringent evaporative emission
standards in the future.
In response to the comments of Lotus Engineering, it is important to note that we are
finalizing flexibility provisions for SVMs. The final rule allows SVMs a two-year delay to
comply with the new evaporative standards. For a model year 2009 start date for LDVs and
LLDTs, SVMs will be permitted to comply with the standards beginning in model year 2011.
For a model year 2010 implementation date for HLDTs and MDPVs, SVMs will be allowed to
meet the standards in model year 2012. Also, under the hardship provisions established in this
rule, SVMs can apply for an additional 2 years — beyond the above delay in the start date — to
comply with the new standards. (Before we grant hardship relief, one of the criteria is that the
applicant must include evidence that the noncompliance will occur despite their best efforts.)
With this extra lead time, the SVMs would be able to utilize proven evaporative emission
hardware from large volume manufacturers (lowest permeation materials, etc.). In addition, it is
likely that the assigned DFs will be revised before the start date of the new standards, since they
are based on the 70th percentile of DFs from large volume manufactures (DFs would likely
decrease due to completion of phase-in of Tier 2 standards, etc.).
In addition, we support the Alliance comments to allow federal certification to the new
standards through California evaporative testing results without obtaining advance approval.
Since we are harmonizing federal evaporative standards with the LEV II evaporative emission
standards in this rule, we believe that for the new standards it is unnecessary to continue to
require this advance approval for California results. Thus, we are finalizing provisions that
would allow certification to the new evaporative emission standards in accordance with
California test conditions and test procedures without pre-approval from EPA.
3.2.2 Timing
What Commenters Said:
The Alliance commented that EPA must independently consider the stringency of LEV II
standards relative to the emissions control capability of multi-fueled vehicles (MFVs) in setting
the timetable for LEV II evaporative emissions standards for these vehicles. The commenter
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noted that, in addressing the timing for compliance of gasoline-fueled vehicles to California's
LEV II evaporative emissions standards, EPA based its timetable for implementing the new
standards on two key factors: 1) that manufacturers already voluntarily equip federally-certified
vehicles with LEV II evaporative systems hardware, so most manufacturers have experience
with these systems; and 2) the Federal in-use environment may raise unique issues 'the broad
range of climates and road conditions across the U.S. can potentially be more severe than in
California' which necessitates unique considerations in the transition to LEV II in-use standards
federally. The commenter noted that the Agency recognizes that the in-use factors are a
significant factor in meeting LEV II evaporative standards over a vehicle's full useful life, and
further commented that when proposing the adoption of LEV II evaporative standards for MFVs,
the same two factors that guided the adoption of the standards for gasoline-fueled vehicles are
critically important considerations. The commenter believes that, in this case, differences
between the fuels lead to a different conclusion regarding a reasonable implementation schedule
for MFVs; thus, the commenter believes that these considerations need to be addressed
independently and not as an extension of adopting LEV II standards for gasoline vehicles. The
commenter offered 'evidence' of these differences, noting that of the Alliance members currently
marketing MFVs, only one manufacturer has any models certified for sale in California where
they are subject to the LEV II evaporative standards.
The Alliance commented that for many manufacturers of MFVs, the new LEV II
evaporative standards are a more stringent requirement being contemplated for these vehicles for
the first time, unlike gasoline vehicles in which case it is not EPA's intention to impose
additional stringency but rather to codify what is already in place. The commenter noted that for
most manufacturers of MFVs, there is currently no demonstrated capability to meet the LEV II
evaporative certification standard from which to begin planning compliance to the standard. The
commenter stated that it believes that this alters the starting point for EPA's rulemaking, as
applicable to MFVs, relative to the starting point for regulating gasoline vehicle evaporative
emissions (where existing systems demonstrate capability to meet the LEV II evaporative
certification standard). The commenter stated that it believes that this alone justifies a separate
timetable for adopting the lower LEV II evaporative standards for MFVs, which it noted that the
Agency recognized in the proposal. The commenter noted, however, that as interest in
alternative fuels heightens due to energy supply issues, manufacturers are suddenly
contemplating widespread introduction of flexible fuel models across entire product lines. The
commenter believes that these new developments justify reconsideration by the Agency of the
general lead-time requirements.
In particular, the Alliance requests the following revisions to the proposed LEV II
evaporative standards for MFVs (See docket number 0881.1, p. 30 for Table 2: Proposed Phase-
in Schedule for LEV II Evaporative Standards for Multi-Fueled Vehicles by Model Year}:
1. Combine the LDV/LLDT and HLDT/MDPV fleets for the purposes of
compliance planning flexibility.
2. Implement a phase-in of this combined fleet to the LEV II evaporative standard
beginning in 2013.
3. Allow a 3-year phase-in of 30/60/100% based on the combined fleet.
The Alliance provided the following technical rationale:
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1. Under the current proposal, 2012 will see an implementation of the LEV II evaporative
in-use standards for gasoline models, using lessons learned from field experience gained
on systems certified to the LEV II standards from 2009 for LDVs/LLDTs and 2010 for
HLDTs/MDPVs. The commenter believes that these in-use lessons learned can be
applied to the MFV product beginning the next model year, to the extent they apply;
where MFV evaporative emission control systems must be robust enough to control
hydrocarbon emissions to near-zero levels from fuels ranging from zero to 85% ethanol,
there can be overlap between operating conditions and consequently some similarity of
field data. This field data can be leveraged, and this encourages a seamless progression
of the LEV II evaporative certification and in-use standards from gasoline vehicles in
2012 to MFVs in 2013.
2. The commenter stated that model renewals provide the most cost-effective and
advantageous timing for introduction of new emissions capability to meet LEV II
evaporative standards. The commenter noted that some manufacturers currently plan
model renewals for multiple vehicle lines in the window of the three model years from
2013 to 2015. The commenter believes that providing a 3-year phase-in for MFVs
provides greater opportunities for scheduled model renewals to coincide with
implementation points for LEV II evaporative standards for these vehicles; planning,
engineering, and development activities necessary to comply with these new standards
can be incorporated into the model redesign activities.
3. The commenter stated that it believes that combining the LDV/LLDT fleet with the
HLDT/MDPV fleet for the purpose of complying with the phase-in requirements of this
new standard for MFVs gives manufacturers greater flexibility in managing the timing of
any necessary redesigns of evaporative emission control system architecture and
technology. The commenter noted that more product lines would be in the pool of
vehicles requiring phase-in, which would allow more choice in how to stage the phase-in.
The commenter believes this is especially important if manufacturers opt to take
advantage of certification to LEV II evaporative standards to offer an MFV package as a
50-state package, which must then also simultaneously satisfy California's LEV II
exhaust emission standards and the additional complexity of NMOG compliance plans,
which are sales-volume based.
4. The commenter stated that it believes that a 3-year phase-in to the LEV II evaporative
standards for MFVs will allow better application of in-use experience gained on those
packages phased-in earlier to those packages phased-in later— thereby shortening the
overall timetable for full implementation of the new standards relative to what would
otherwise be necessary.
The Alliance commented that the MFV portion of the light-duty on-road fleet is currently
a small fraction of the total light-duty fleet, and that while this is expected to increase, it is still
projected to be a small fraction through the proposed phase-in period. The commenter stated that
it believes that the incremental effect of providing a 3-year phase-in of MFV LEV II evaporative
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standards will not materially affect the contribution of the light-duty fleet to the air toxics
inventories.
Letters:
Alliance of Automobile Manufacturers (Alliance)
Our Response:
OAR-2005-0036-0881
We believe that many of the concerns expressed by manufacturers supporting additional
lead time for MFVs are valid. Most manufacturers have less experience meeting the new
standards on the non-gasoline portion of MFVs (or FFVs) compared to gasoline vehicles.
Different from what we proposed, the new standards will apply beginning in model year 2012
with a three-year phase-in, 30/60/100 percent, for LDVs/LLDTs and HLDTs/MDPVs grouped
together (see the below table for the phase-in schedule). Although auto manufacturers requested
a start date of 2013 for a combined fleet, we believe the additional flexibilities we are providing
(three-year phase-in and grouping LDVs/LLDTs and HLDTs/MDPVs together) is sufficient
flexibility for the production of MFVs. There is enough time between now and the
implementation dates or phase-in schedule (2012 through 2014) for manufacturers to coordinate
model renewals with the introduction of broader product offerings of MFVs.
Phase-ii
i Schedule for Non-Gasoline Portion of MFVs: Evaporative Emission Standards*
Vehicle GVWR (Category)
< 6000 Ibs (LDVs/LLDTs)
and
> 60001bs (HLDTs and MDPVs)
2012
30%
2013
60%
2014
100%
*Phase-in schedules are grouped together for LDVs/LLDTs and HLDTs/MDPVs.
As described in section V.C.4 of the rulemaking (In-Use Evaporative Emission
Standards), the existing Tier 2 evaporative emission standards will apply in-use for the first three
model years after an evaporative family is first certified to the new standards, but similar interim
in-use provisions will not apply to the non-gasoline portion of MFVs. We believe that three to
five additional years to prepare vehicles (or evaporative families) to meet the certification
standards, and to simultaneously make vehicle adjustments from the federal in-use experience of
other vehicles (including those that are not MFVs) is sufficient to resolve any issues for MFVs.
Therefore, according to the phase-in schedule above for a combined fleet (for non-gasoline
portion of MFVs), the evaporative emission standards will apply both for certification and in-use
beginning in 2012 for LDVs/LLDTs and HLDTs/MDPVs.
3.2.3 Other
3.2.3.1 On-Board Diagnostics and Evaporative Emissions Standards
What Commenters Said:
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WDNR questioned whether or not, with regard to evaporative emissions standards,
vehicles with On-Board Diagnostic II (OBD II) systems would require recalibration by the
manufacturer of the evaporative monitor in the OBD II system to ensure that the evaporative
emission standards that are chosen in adopted rule are met. The commenter also questioned
whether or not manufacturers would have some identification for the new vehicles that meet the
standard, noting that individual State and local agencies will not have the capability to identify
these new certified vehicles in an OBD II emissions testing program. In addition, the commenter
asked how the use of ethanol added fuel (E10 or E85) would affect the certified recalibration
standard for the evaporative monitor in the OBD II system in new vehicles.
Letters:
Wisconsin Department of Natural Resources, Bureau of Air Management (WDNR) OAR-
2005-0036-0828
Our Response:
We believe some additional context is needed in regard to OBD II requirements. OBD II
monitors for vapor leaks (0.040 inches or 1 millimeter is the EPA leak monitor requirement; a
vacuum or pressure check of the evaporative system is performed to test for leaks) and
equipment malfunctions of the evaporative emissions system. Therefore, the OBD II system
would not have to be recalibrated for the new evaporative emission standards. Moreover, the
OBD II system will operate the same regardless of fuel type, and thus, E10 or E85 fuels (E10 is
fuel that is 10 percent ethanol and 90 percent gasoline, and E85 is fuel that is 85 percent ethanol
and 15 percent gasoline) will not impact the OBD II system monitoring for evaporative emission
leaks. As for identification of the new vehicles meeting the promulgated standards, we have a
vehicle certification database on EPA's website at www.epa.gov/cfeis.htm, and in this database
the public would be able to identify the evaporative emissions data for new vehicles. (This
database includes a document index system (DIS), and it contains a summary of the certification
test data on a report, which is commonly called the "summary sheet.")
3.2.3.2 Compliance During Phase-in Period
What Commenters Said:
WDNR questioned who will be responsible for ensuring that the standards are being
complied with during the phase-in.
Letters:
Wisconsin Department of Natural Resources, Bureau of Air Management (WDNR) OAR-
2005-0036-0828
Our Response:
EPA has compliance and enforcement staff that are responsible for ensuring that
manufacturers meet the standards according to the phase-in schedules. In addition,
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manufacturers are required to perform in-use, 2-day evaporative emission tests on one low-
mileage vehicle and one high-mileage vehicle in each certified evaporative family. (Low-
mileage vehicles are typically one year old with approximately 10,000 to 20,000 miles. High-
mileage vehicles are typically three to four years old with a minimum of 50,000 miles.)
3.2.3.3 Cold-temperature Testing for Compliance Assurance
What Commenters Said:
Anchorage recommended cold-temperature testing of running and evaporative emissions
to ensure controls are working as designed.
Letters:
Municipality of Anchorage, Department of Health and Human Services (Anchorage) OAR-
2005-0036-0976
Our Response:
It is important to note that evaporative emissions are much less at cold temperatures.
EPA's evaporative emission test procedures correspond to in-use vehicle operation in ozone-
prone summertime conditions — hot weather (March 24, 1993; 58 FR 16002). See also section
202(k) of the Clean Air Act - Evaporative Emissions.
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4. GASOLINE BENZENE PROGRAM
What We Proposed:
The comments in this chapter correspond to Section VII of the NPRM and relate
to our proposed gasoline benzene control program. A summary of the comments
received, as well as our response to those comments, are presented for each issue. For
the full text of comments summarized here, please refer to the public record for this
rulemaking.
4.1 Standards
4.1.1 Benzene Standards
4.1.1.1 Average Standard of 0.62 Vol% Is Not Stringent Enough
What Commenters Said:
Many commenters supported a more stringent average benzene standard than the
proposed standard of 0.62 vol%. Most of these commenters supported an average
standard of 0.52 vol%; one commenter suggested a standard between 0.62 vol% (the
current average benzene level for RFG) and 0.41 vol% (the lowest individual refinery
level in 2003). These commenters gave two main reasons for a more stringent standard:
1) that a more stringent standard is feasible, and 2) a more stringent standard could be
achieved at a reasonable cost.
Comments supporting the feasibility of a more stringent standard pointed out that
a number of refineries are producing gasoline today with benzene content well below the
proposed average standard. Several commenters argued that the average standard should
be sufficiently stringent that all refineries, especially those with higher benzene levels,
would be required to use similar technologies and achieve similarly low levels. Some of
these commenters point to EPA's analysis showing that a standard as low as 0.52 vol%
would be feasible from a strictly technological standpoint. One commenter, the New
York Department of Environmental Conservation, stated its belief that because gasoline
in the New York metropolitan area is already low compared to other parts of the country,
the proposed average standard would not likely result in further reductions in that area.
Regarding cost, several commenters observed that EPA's analysis showed that
while a much more stringent standard of 0.52 vol% would increase average costs by more
than a factor of two, the resulting average costs per gallon would still be less than were
projected for the gasoline sulfur program, which EPA considered reasonable in that
instance.
Our Response:
While many of the comments on the level of the average standard discuss
technological feasibility and cost separately, we believe that the statute requires us to
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consider these factors together (see Sierra Club v. EPA, 325 F. 3d at 378).7 In the
proposal, we considered a range of levels for the average benzene standard, taking into
account technological feasibility as well as cost and the other enumerated statutory
factors. We have reassessed the level of the standard in light of these factors, and have
concluded that the proposed level of 0.62 vol% is the appropriate level for the average
standard, because it achieves the greatest achievable emission reductions through the
application of technology that will be available, considering cost, energy, safety, and lead
time.
In the proposal, EPA described in detail what we believe would be the
consequences to the overall goals of the program of average standards of different
stringencies (see 71 FR 15866-67). These anticipated consequences relate in large part to
how we believe refiners would respond to the benzene averaging and benzene credit
trading provisions that were integral to the proposed program. For the final rule, we have
reassessed how we believe refiners would respond to different average standards. We
continue to believe that increasing the stringency of the average benzene standard could
have the effect of reducing the number of benzene credits generated, since fewer
refineries are likely to take actions to reduce benzene further than required by the
standard. At the same time, a more stringent standard would increase the need for more
technologically challenged refineries to purchase credits. Directionally, we showed at
proposal that a more stringent average standard would increase costs for these refineries.
This is because credits may be less available and/or less affordable as an alternative to
immediate capital investment, and investment in relatively expensive benzene saturation
equipment would be necessary for a greater number of refiners that could not comply
with credits alone. For the final rule, we specifically considered a level of 0.50 vol% for
the average standard, which we expect would require all refineries to install the most
expensive benzene control technologies (either benzene saturation or benzene extraction).
We concluded that this level would clearly not be feasible, considering cost. In a related
analysis, we also showed that if, contrary to our expectations, credits were not easily
available as a compliance option, there are several refineries for which it may be
technologically feasible to reach benzene levels below 0.62 vol%, but only at costs far
greater than for most other refineries.8
The commenters supporting a more stringent average benzene standard did not
provide data or analysis to address the potential negative effects of different standards
7 "[Petitioners point out that section 202 (1) (2) is 'technology-forcing,' so that the agency must consider
future advances in pollution control capability. This is not disputed, but doesn't take petitioners far. The
statute also intends the agency to consider many factors other than pure technological capability, such as
costs, lead time, safety, noise and energy. And its language does not resolve how the Administrator should
weigh all these factors in the process of finding the 'greatest emission reduction achievable.'"
8 It is true that the final rule contains a hardship provision which could apply to individual refineries facing
extreme economic or other hardship in meeting the benzene standards. However, the existence of this
provision does not mean that EPA can reasonably adopt more stringent standards assuming that refineries
may obtain some type of hardship waiver. The hardship provision is designed to accommodate those rare
situations where, contrary to predictions now, a refiner faces unusual circumstances resulting in extreme
hardship affecting its ability to comply. If grant of hardship relief from the benzene standards became a
norm rather than an exception, EPA doubts that the standard would reflect "maximum emissions reductions
achievable" since demonstrably the standard would not be being achieved by many refineries.
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that we presented in the proposal, especially in the context of the proposed ABT program.
Many comments that supported a more stringent standard pointed to average costs
projected in the proposal that are higher than for the proposed standard, but are not large
on a per-gallon basis compared to other EPA fuel programs. However, even assuming
that it is relevant here to consider per-gallon costs for removal of sulfur in other
rulemakings,9 these commenters did not address the wide range of compliance costs for
individual refineries that we discuss in the proposal (see Chapter 9 of the RIA). It is
critical to recognize that as more stringent average standards are considered, the costs for
individual technologically-challenged refineries tend to become very high. This potential
for high costs at more stringent average standards exists if, as we expect, the ABT
program functions as it is designed to; if the ABT program functions less efficiently than
projected, the costs for some individual refineries could be higher still.
As noted above, we believe that there are increasingly significant issues of cost
and technological feasibility for a variety of refineries as average standards below 0.62
vol% are considered. We remain convinced that an average standard of 0.50 vol% would
clearly not be a feasible nationwide program, considering cost, since so many more
refineries would need to use the highest-cost benzene control technologies. As at
proposal, EPA continues to believe that setting an average standard more stringent than
0.62 vol% would necessarily begin to create the serious issues we identified for a
standard of 0.50 vol%. Yet, as our updated analyses continue to show, these concerns do
not appear to be significant at a level of 0.62 vol%. We therefore continue to believe that
an average standard of 0.62 vol%, in the context of the ABT program, will maximize the
benzene reduction nationwide, will minimize the likelihood of refineries experiencing
extreme costs, and will reasonably distribute costs nationwide among refineries.
The NY DEC is correct in highlighting that some areas of the country already
have such low benzene levels that the opportunity or further control is more limited.
However, although current benzene levels in some areas are indeed lower than 0.62
vol%, this does not mean that all refiners and importers in those areas have fully
implemented all of their benzene control potential. We believe based on our refinery
modeling that the ABT program will create incentives for refiners in all areas to consider
further benzene reductions, to generate credits to use at other of its refineries or to sell. A
strong market for benzene as a petrochemical feedstock may well provide additional
incentive for extracting additional benzene at some refineries. Thus, although some
refiners in some areas may choose not to reduce benzene further under the final benzene
control program, we think it is likely that an overall reduction in gasoline benzene levels
will result in all areas of the country.
We are thus finalizing the 0.62 vol% standard as proposed. We believe that this
average benzene standard of 0.62, in the context of the associated ABT program and the
9 See Sierra Club v. EPA. 353 F. 3d 970, 986 (D.C. Cir. 2004) ("[t]his court has adopted an 'every tub on
its own bottom' approach to EPA's setting of standards pursuant to the CAA, under which the adequacy of
the underlying justification offered by the agency is the pertinent factor - not what the agency did on a
different record concerning a different industry")
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1.3 vol% maximum average standard, achieves the greatest reductions achievable, taking
into account cost and the other statutory factors in CAA 202(1)(2).
4.1.1.2 Average Standard of 0.62 Vol% Is Too Stringent
What Commenters Said:
Several commenters, all of which are refining companies, commented that they
believe that the 0.62 vol% average benzene standard would create serious financial and
technical burdens on them and that a less stringent standard should be adopted. The Ad
Hoc Coalition of Small Refiners indicated that it was not clear that it will be possible for
all of its members to produce market-grade gasoline that meets a 0.62 vol% standard.
Two individual refiners commented that it may not be possible for them to meet 0.62
vol%, even using benzene saturation equipment.
Several other refiners made statements that while technologically feasible, the
proposed standard would create various technical challenges at their refineries. These
refiners mentioned the need for additional capital investment; the inability to pursue
benzene extraction as a control option due to lack of proximity to benzene chemical
markets; challenges in recovering octane value; the lack of corresponding economic
benefit to benzene related improvements; and the challenge of less hydrogen production
when controlling benzene. In addition, one company that imports gasoline indicated that
a standard of 0.62 vol% may limit the volume of imported gasoline, increase its cost, and
adversely affect importers, suggesting that a standard of 1.0 vol% would be more
appropriate.
Our Response:
The commenters stating that the 0.62 vol% average standard is too stringent did
not address or did not give sufficient emphasis to the fact that no refiner will be required
to produce gasoline at the 0.62 vol% level. Even with the addition of the 1.3 vol%
maximum average standard, the ABT program will allow refiners that produce gasoline
at levels of 1.3 vol% or less to be able to comply with the 0.62 vol% standard by using
credits. By combining operational changes, capital equipment, and the use of credits, we
believe all refineries will be able to comply with the average standard (and the maximum
average standard) within the time available. Should these assumptions prove unfounded,
and an individual refiner demonstrates extreme hardship in meeting either of the benzene
standards, relief via a hardship variance is available on a case-by-case basis (see section
80.1335). Moreover, if a small refiner demonstrates that the ABT program is not
functioning as expected and meeting the 0.62 vol% standard via credits creates extreme
hardship (e.g., sufficient credits are for some reason not available or are prohibitively
expensive), the refiner may apply for case-by-case hardship relief under section 80.1343.
We do not believe that the technical issues raised by the commenters warrant a
change in the proposed average standard. We agree that each of the circumstances
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presented by the commenters is likely to occur, and we account for them in our modeling
and discuss them in the preamble (section VI) or in the RIA (Chapter 6). We believe that
such circumstances will rarely if ever cause extreme hardship, especially since refiners
must physically produce gasoline only at a 1.3 vol% level or less, not a 0.62 vol% level.
Regarding the comment about negative impacts of the proposed program on the
importing of gasoline, we agree that the cost of imported gasoline will rise with the cost
of gasoline refined domestically. However, the requirements of the program are
essentially identical for both refiners and importers, and we expect that the relative
positions in the market between refiners and importers will not change substantially.
4.1.1.3 The Proposed Program Would Affect Geographic Equity in Gasoline
Benzene Levels
What Commenters Said:
Several commenters state that the proposed program would maintain or create
inequities in gasoline benzene levels from one part of the country to the other, stating or
implying that the program should reduce or eliminate such inequities. These commenters
attribute these inequities to the nature of the 0.62 vol% standard as an average, which
through trading of credits that will occur under the ABT program will allow for variations
in gasoline benzene levels across the country. Especially in the absence of an upper limit
on benzene, these commenters are concerned that benzene levels in some areas will not
be reduced, or may increase, including areas that currently have the highest benzene
levels. Some of these commenters specifically indicated that certain areas would have
what they believe to be unacceptably high gasoline benzene levels after the proposed
program was implemented. One commenter believes that the program should reduce
benzene levels to the lowest levels achievable nationally, regionally, and locally.
Our Response:
Our updated analysis shows that with the 0.62 vol% average standard and the
maximum average benzene standard of 1.3 vol%, benzene levels will be reduced very
significantly in all parts of the country. However, a degree of variation will continue to
exist, due to the wide variety of refinery configurations, crude oil supplies, and
approaches to benzene control, among other factors. This remaining variation is clearly
legally permissible, because we do not read CAA section 202(1)(2) as requiring uniform
gasoline benzene levels in each area of the country, since the standard is to be
technology-based considering costs and other factors which vary considerably by region
and by refinery. On the other hand, the maximum average standard will have the
appropriate effect of direct!onally providing a greater degree of geographic uniformity of
gasoline benzene levels and these levels remain feasible achievable considering cost and
the other enumerated factors. The program adopted here achieves both national and
regional reductions by means of a national standard resulting in greatest aggregate
emissions reductions (the annual average standard with ABT), plus a maximum average
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standard to assure optimization of reductions in all areas. It is reasonable to adopt these
standards together here, given the rather large initial disparities in initial benzene levels
across fuel regions. Seeking some degree of geographic uniformity in gasoline benzene
levels is within the Administrator's discretion, given that section 202 (1) (2) does not
specify whether maximum achievable reductions are to be achieved nationally,
regionally, or both. The effect of the program on geographic variability in benzene levels
is discussed in section VI of the preamble and Chapter 9 of the RIA.
4.1.1.4 Consideration of an Upper Limit Benzene Standard
What Commenters Said:
Several individual refiners and representatives of refiners supported the proposed
program's approach of an average standard without a separate upper limit standard.
Generally, these commenters supported a program without either a per-gallon cap
standard or a maximum average standard, although some of them indicated that a per-
gallon cap standard would be more problematic than a maximum average standard. None
of these commenters provided analysis or data about the potential effects if an upper limit
standard were added.
The Ad Hoc Coalition of Small Business Refiners expressed serious concern
about the addition of a maximum average standard. They stated that with a maximum
average standard of 1.3 vol%, at least several small refiners would be required to install
capital equipment at very significant cost. They maintained that including a maximum
average standard creates no additional benzene reduction while increasing compliance
costs (citing EPA's analysis at proposal in support). Again citing analysis from the
proposed rule, they maintained that including a maximum average would simply shift
emission reductions from one region of the country to another, again in their view,
imposing costs without any emission reduction benefit. Finally, they advanced the legal
argument that imposition of a 1.3 vol% maximum average without consideration of the
costs on each refinery violates section 202(1) of the Act, which requires EPA to take costs
into consideration in determining maximum degree of emission reduction achievable.
They urged EPA not to implement a maximum average standard, and, if it did, to include
provisions to allow small refiners to comply with the standard using credits. They
suggested alternatives for how such a provision might be structured, either by restricting
credits used to meet the 1.3 vol% standard to the PADD in which the refiner is located, or
discounting credits used to meet the 1.3 vol% standard.
Most comments from state and local air pollution agencies, environmental/public
health organizations, and private citizens supported the addition of an upper limit
standard. Several commenters supported a per-gallon benzene cap. Others supported a
maximum average standard. Most of the commenters supporting a maximum average
standard, including joint comments from four U.S. Senators from the northwest U.S.,
specified a value of 1.3 vol%, and one commenter supported a maximum average
standard of 0.78 vol%. These commenters referred to EPA's analyses of these levels in
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the proposal, and did not present any additional analytical support. Finally, we received
similar comments from approximately 1,000 individual citizens who generally supported
an upper limit. These commenters gave two primary reasons for their support of upper
limit standards: that an upper limit would provide more certainty that most refineries
would reduce benzene levels and would not increase them, and that variations in benzene
levels would be reduced or eliminated. Most of these commenters also pointed to EPA's
NPRM analysis showing that the estimated average industry-wide costs of adding an
upper limit standard would not be large.
Our Response:
Upper Limit Benzene Standard
In the proposal, we considered the implications of an upper limit on the actual
level of benzene in the gasoline that refiners produce (as opposed to the level achieved
using credits) (see 71 FR 15868-69.) We considered an upper limit both in the form of a
per-gallon benzene cap and a limit on the average of actual benzene in gasoline produced
by a refinery ("maximum average standard"). Of these two approaches, we recognized
that a per-gallon cap would be the more rigid. If every batch needed to meet the cap,
there would be no opportunity to offset benzene spikes with lower-benzene production at
other times. Even during times of normal operation, our review of refinery batch data
indicated that unavoidable wide swings commonly occur in the benzene content of
gasoline batches, even for refineries that have relatively low benzene levels on average.
A per-gallon cap could result in refiners halting gasoline production during short-term
shut-downs of benzene control equipment or in other temporary excursions in benzene
levels. Unless a per-gallon limit were generous enough or included case-by-case
exceptions (eroding the possible benefit of the cap), many refiners would likely need to
implement much deeper and more costly reductions in benzene than would otherwise be
necessary, simply to protect against such fluctuations. For some refiners, we tentatively
concluded, a cap could make complying with the program prohibitively expensive.
The other option on which we solicited comment, a maximum average standard,
would be more flexible. A maximum average standard would limit the average benzene
content of the actual production at each refinery over the course of the year, regardless of
the extent to which credits may have been used to comply with the 0.62 vol% average
standard. Thus, a maximum average standard would allow for short-term benzene
fluctuations as long as the annual average benzene level of actual production was less
than that upper limit.
After evaluating the results of our updated refinery analysis and considering all of
the comments, we now believe that the program should include a maximum average
benzene standard set at an appropriate level. The maximum average standard has the
strong advantage of ensuring that the benzene content of gasoline produced by each
refinery (or imported by each importer) will average no higher than that level, regardless
of the use of credits, providing greater assurance that actual in-use benzene reductions
more clearly reflect our modeled projections which form the basis for this rule. At the
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same time, the maximum average standard avoids the serious drawbacks of a per-gallon
cap.
As explained in section VI.A.l.d of the preamble to the final rule, while we have
used all information available to us, our modeling cannot predict with high confidence
each individual refinery's actions and how benzene trading will occur in all cases. Thus,
although our analysis at proposal indicated widespread reductions in gasoline benzene
levels in all fuel regions (notwithstanding that any individual refinery could avoid
benzene reductions through credit purchases), we cannot dismiss with high confidence
the possibility voiced in the comments that significant disparities in gasoline benzene
levels will remain. Consequently, we are adding an upper limit to the 0.62% average
standard in order to provide greater assurance that the benzene emission reductions we
project, including their uniform distribution, are actually achieved. By selection of an
appropriate level for the maximum average, the program will achieve these important
benefits with a very small impact on the program's overall cost.
We have chosen a level of 1.3 vol% for the maximum average standard. We
believe this level represents a reasonable balance between the additional cost and
increased confidence in the occurrence of expected gasoline benzene reductions in all
fuel regions. Implementing an upper limit below 1.3 vol% would increase the number of
refineries needing to install the most expensive benzene reduction equipment, thus
diminishing the flexibility of the ABT program and increasing the cost of the program.
Conversely, an upper limit above 1.3 vol% would have only limited effectiveness in
ensuring that the modeled benzene gasoline levels are achieved in the long term. .
We carefully considered the comments of small refiners regarding a maximum
average standard. We do not accept the position that a maximum average standard
imposes costs without emission reduction benefits. As stated in response 4.1.1.3 and the
preamble to the final rule, the maximum average requirement assures that predicted
reductions in gasoline benzene levels across all PADDs will in fact occur. As further
stated, this assures that maximum achievable reductions will occur both nationally and
regionally, a reasonable objective. We also no longer believe that the effect of a
maximum average cap will be merely to redistribute benzene gasoline levels. We
tentatively reached that conclusion at proposal based on refinery-by-refinery modeling
that among other things assumed a precisely linear response between the level of
standards and the volume of credits generated. This assumption is not a given, since
(among other things) refineries may in fact decide to overcomply with the annual average
standard for reasons other than credit generation, such as assuring a compliance safety
margin. More generally, we now believe that the predicted offsetting effects are too
small relative to the accuracy of the predictive model for us to have certainty they will
occur.
Small refiners further argued that EPA has ignored costs to each refinery in
adopting the maximum average standard, and that this violates the requirement in section
202(1)(2) to consider costs in determining maximum emissions reductions achievable.
The statute does not specify how costs are to be considered, and so does not require
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refiner-by-refiner cost determinations. Our approach to considering cost in this rule is
well within the ample discretion the statute affords. We considered costs to the refining
industry overall and on an aggregate cost per gallon of gasoline basis, and conducted the
same analysis on a PADD by PADD, and refiner-by-refiner basis. As explained in detail
in chapters 9 and 14 of the final RIA, although not every refiner will incur the same cost
impacts under the rule, we believe that the overall costs of complying with the rule are
reasonable. As explained in those same sections, we believe that the rule is also
technically feasible at reasonable cost for all refiners. In addition, if economic impacts
on individual refiners are more severe than expected, the rule includes safety valve
provisions whereby refiners can obtain relief by demonstrating significant economic
hardship.
Several commenters supported an upper limit standard as a way of reducing the
variation in benzene levels that currently exist across the country. We agree that
reducing gasoline benzene levels on both a national and regional basis is a reasonable
objective, as discussed in section 4.1.1.3 above, and further agree that implementing the
overall program (including the maximum average standard) will have the effect of
reducing variability in gasoline benzene levels, as also discussed in that response.
We discuss in more detail our rationale for adding a maximum average standard,
and for our selection of the level of 1.3 vol% for that standard, in section VI of the
preamble for this final rule.
Letters relating to Section 4.1.1:
Ad Hoc Coalition of Small Business Refiners OAR-2005-0036-0686
Alaska Department of Environmental Conservation, Division of Air Quality (ADEC)
OAR-2005-0036-0975
American Lung Association OAR-2005-0036-0365 (Hearing testimony)
(Municipality of) Anchorage, Department of Health and Human Services OAR-2005-
0036-0976
Citizen comments OAR-2005-0036-1019 (generally representative of approximately
l,000n citizen comment letters)
Colonial Oil Industries, Inc. OAR-2005-0036-0990
Countrymark Cooperative, LLP OAR-2005-0036-0471
Environmental Defense, NRDC, U.S. PIRG, ALA OAR-2005-0036-0868
ExxonMobil Refining & Supply Company OAR-2005-0036-0772
Flint Hills Resources, LP (FHR) OAR-2005-0036-0862
Lane Regional Air Protection Agency (LRAPA) OAR-2005-0036-0848
Marathon Petroleum Company LLC OAR-2005-0036-1008
National Petrochemical & Refiners Association (NPRA) OAR-2005-0036-0809
New Jersey Department of Environmental Protection, Division of Air Quality (NJ DEP)
OAR-2005-0036-0829
New York Department of Environmental Conservation OAR-2005-0036-0722
NESCAUM OAR-2005-0036-0993
Oregon Department of Environmental Quality (OR DEQ) OAR-2005-0036-0987
Oregon Toxics Alliance (OTA) OAR-2005-0036-0948
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Private Citizen OAR-2005-0036-0368
Puget Sound Clean Air Agency OAR-2005-0036-0780
Silver Eagle Refining, Inc. OAR-2005-0036-0839
Sinclair Oil Corporation, Flying J. Inc., Suncor Energy (U.S.A.) Inc., and Tesoro
Corporation OAR-2005-0036-0989
STAPPA/ALAPCO OAR-2005-0036-0836
United Refining Company OAR-2005-0036-0827
U.S. Senator Ron Wyden et al
Washington State Department of Ecology OAR-2005-0036-0950.1
Wisconsin Department of Natural Resources, Bureau of Air Management (WDNR)OAR-
2005-0036-0828
4.1.2 Consideration of Other Fuel Controls
4.1.2.2 Consideration of a Total Toxics Performance Standard
What Commenters Said:
Several commenters, primarily individual refining companies and organizations
representing refining companies, supported the proposed benzene control approach of
focusing on gasoline benzene content rather than on total toxics emissions. Generally,
they stated that the proposed benzene content standard would result in the same toxics
emissions benefits (since refiners would meet a toxics standard through benzene control
anyway), and they support the simplification in gasoline toxics regulation that the
proposed program would represent.
On the other hand, many commenters supported an MSAT program that includes
a total toxics standard, either in addition to or instead of an average benzene standard. In
general, these comments express concern that the lack of a total toxics performance
standard could allow refiners to increase other MSATs even while reducing benzene.
One commenter pointed out that EPA made similar arguments in support of the MS ATI
program.
Letters:
American Petroleum Institute (API) OAR-2005-0036-0884
American Petroleum Institute (API) and National Petrochemical and Refiners
Association (NPRA) OAR-2005-0036-1015
BP Products North America Inc. OAR-2005-0036-0824
ExxonMobil Refining & Supply Company OAR-2005-0036-0772
Flint Hills Resources, LP (FHR) OAR-2005-0036-0862
Independent Fuel Terminal Operators Association OAR-2005-0036-1007
Marathon Petroleum Company LLC OAR-2005-0036-1008
National Petrochemical & Refiners Association (NPRA) OAR-2005-0036-0809
New Jersey Department of Environmental Protection, Division of Air Quality (NJ DEP)
OAR-2005-0036-0829
NESCAUM OAR-2005-0036-0993
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Puget Sound Clean Air Agency OAR-2005-0036-0780
Regional Air Pollution Control Agency (RAPCA) OAR-2005-0036-0771
Sunoco, Inc. OAR-2005-0036-0806
United Refining Company OAR-2005-0036-0827
Washington State Department of Ecology OAR-2005-0036-0950
Wisconsin Department of Natural Resources, Bureau of Air Management (WDNR)
OAR-2005-0036-0828
Our Response:
For several reasons, we continue to believe that a benzene-only standard is
superior to a toxics emissions performance standard as a means of achieving the greatest
emission reductions of mobile source air toxics under section 202(1). First, because
controlling benzene is much more cost-effective than controlling emissions of other
MSATs, refiners historically have preferentially reduced benzene under the MS ATI and
other air toxics control programs. This is despite the theoretical flexibility that refiners
have under a toxics performance standard to change other fuel parameters instead of
benzene. Thus, even if we were to express the proposed standard as a total air toxics
performance standard, we would expect the outcome to be the same - refiners would
reduce benzene content and leave unchanged the levels of other MSATs. Many industry
commenters confirmed this point in their comments on the proposed rule.
Second, even with, or as a result of, this fuel benzene control, we do not expect
refiners to actively modify their refinery operations such that increases will occur in
emissions of the other MSATs currently controlled under the existing toxics performance
standards. These other MSATs are acetaldehyde, formaldehyde, POM, and 1,3-
butadiene, and they are all affected to varying degrees by VOC emissions control. VOC
emissions are generally decreasing due to the gasoline sulfur controls recently phased in
along with more stringent vehicle controls under the Tier 2 program, as well as the
vehicle controls being finalized under this program (see section V of the preamble). In
combination, these changes are expected to decrease VOC-based MSAT emissions
substantially.
The one MSAT likely to increase in the future is acetaldehyde. The proposed
Renewable Fuels Standard (RFS) Program10 ensures that ethanol use will increase, and
thus acetaldehyde as well, since that MSAT is directly and substantially affected by
ethanol use. Acetaldehyde emissions are currently increasing (and formaldehyde
emissions decreasing) due to the substitution of ethanol for MTBE in RFG as a result of
state MTBE bans. Any action that refiners could take to offset the total toxics increase as
a result of acetaldehyde increasing would be through benzene control, which we are
already requiring to be controlled to the maximum extent achievable. The EPAct, which
charged EPA with developing the RFS program, also requires an evaluation of that Act's
impacts on air quality. Any future control of acetaldehyde emissions will be based
primarily on the results of that study, a draft of which is required by the EPAct to be
10
71 FR 55552, September 22, 2006.
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completed in 2009. EPA thus believes it is premature to act on this issue until we
determine a course of future action reflecting the EPAct study.
With the exception of acetaldehyde, the benzene control program will ensure the
certainty of additional reduction in MSAT emissions, and other MSAT emissions are
unlikely to increase under this program. We therefore believe that regulatory controls
and the associated paperwork and other administrative costs for these other MSATs,
including a total toxics standard, are not necessary. A toxics emissions performance
standard that would effectively achieve the same level of MSAT reduction would just be
more costly and complex. We see no justification for the added complexity, paperwork,
and other administrative costs of a total toxics standard. For all of these reasons, we
believe a standard in the form of a benzene content standard will produce more certain
environmental results with less complexity than a toxics emissions performance standard,
and we are therefore finalizing only a benzene content standard.
As one commenter pointed out, this conclusion is different from that reached in
the MS ATI final rule (66 FR 17230, March 29, 2001). However, there are several
reasons for a different decision here. First we have gained much more experience in
witnessing refiner actions and behavior following the implementation of the MS ATI
standard (notably their reliance on benzene reductions to satisfy the MSAT1 standard).
Second, several changes to the fuel pool have occurred which constrain the ability of
refiners to adjust toxics performance in ways other than changing benzene content, most
notably the removal of both MTBE and sulfur from gasoline. Third, the MSAT2
standards require significant reductions in MSAT levels, whereas the MSAT1 standards
were merely meant to maintain existing performance. To reduce toxics, it is clear that
benzene is now a refiner's only viable option, and a benzene-only standard is thus the
most effective regulatory approach.
4.1.2.2 Consideration of Regulation of Other MSATs
What Commenters Said:
In addition to comments expressing concern that MSATs other than benzene
might increase in the absence of a toxics performance standard (see previous section),
some commenters urged specific regulatory action to reduce some of these MSATs. One
commenter advocated adoption of key parameters of California's Reformulated Gasoline
III specifications (aromatics content, olefms content, and sulfur). Various commenters
expressed concern about e 1,3-butadiene, acrolein, acetaldehyde, and formaldehyde.
Another commenter believes that it is premature to limit MSAT regulation to benzene
alone, and encouraged EPA to specifically remain open to prompt further regulation of
other MSATs if future changes to gasoline parameters do not address them. The
commenter provided naphthalene and gasoline PM as potential examples. Another
commenter encouraged EPA to continue to develop comprehensive data on toxics
emissions from Tier 2 vehicles so that greater confidence can be placed in analyses
performed using the Complex Model.
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One commenter specifically supported EPA's decision not to propose further
control of POM, 1,3 -butadiene, formaldehyde, acetaldehyde, and gasoline aromatics
content.
Letters:
Environmental Defense, NRDC, U.S. PIRG, ALA OAR-2005-0036-0868
Marathon Petroleum Company LLC OAR-2005-0036-1008
New Jersey Department of Environmental Protection, Division of Air Quality (NJ DEP)
OAR-2005-0036-0829
Puget Sound Clean Air Agency OAR-2005-0036-0780
Wisconsin Department of Natural Resources, Bureau of Air Management (WDNR)
OAR-2005-0036-0828
Our Response:
In the previous section and in section VI of the preamble, we lay out our reasons
for believing that the final program (without a toxics performance standard) will not
result in increases in MSATs other than benzene. This same reasoning supports our
conclusion that further regulation of any of these MSATs is not appropriate at this time.
The Agency remains open to any new information that might indicate that future
regulatory action on other MSATs is warranted. Moreover, as indicated in the previous
response, EPA will specifically consider the effect of acetaldehyde emission as part of the
study mandated by the EPAct.
As the one commenter stated, current emission models would suggest that
California gasoline may provide somewhat greater toxics performance than the benzene
standard we are finalizing. However, considering the limited data on new technology
vehicles with which to quantify these emission reductions, and the far greater cost of such
fuel changes, we do not believe such requirements would be appropriate at this time.
4.1.2.3 Control of Aromatics
What Commenters Said:
Several commenters specifically stated that aromatics in gasoline (other than
benzene) should be targeted for control in this rule. Most of these commenters pointed to
the fact that toluene and xylene (some also mentioned ethyl benzene) are also considered
MSATs and their content in gasoline should be reduced. Some commenters also
mentioned the connection between aromatics and secondary (atmospherically formed)
PM. Two commenters, the Energy Future Coalition (EFC) and TEIR Associates,
compiled several existing studies and expressed their belief that replacing aromatics can
be broadly replaced with ethyl tertiary butyl ether (ETBE), an ether produced from
ethanol. API and NPRA responded to the EFC and TEIR comments with supplemental
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comments that countered several points. These organizations also raised concerns about
potential groundwater contamination from ETBE, as has occurred with the ether MTBE.
Other commenters, mostly from the refining industry, oppose new controls on
gasoline aromatics at this time, generally agreeing with EPA that it is not yet clear that
such controls would be cost-effective.
Letters:
American Petroleum Institute (API) and National Petrochemical and Refiners
Association (NPRA) OAR-2005-0036-1015
Energy Future Coalition OAR-2005-0036-0840
Flint Hills Resources, LP (FHR) OAR-2005-0036-0862
Mothers & Others for Clean Air OAR-2005-0036-0991
New Jersey Department of Environmental Protection, Division of Air Quality (NJ DEP)
OAR-2005-0036-0829
New York Department of Environmental Conservation OAR-2005-0036-0722
NESCAUM (Northeast States for Coordinated Air Use Management) OAR-2005-
0036-0993
TEIR Associates, Inc OAR-2005-0036-0838
TEIR Associates, Inc. OAR-2005-0036-1012
Our Response:
EPA considered the potential for additional aromatics control as a part of the
proposed rule (see 71 FR 15864). We have considered the issue further in light of the
public comments. For the following reasons, we continue to believe that additional
aromatics control (beyond the benzene control of this rule and beyond the reduction in
gasoline aromatics that we believe will occur without further action) is unwarranted at
this time. We will continue to investigate this area, as described below and in section VI
of the preamble.
We note first that regardless of specific regulatory action to control aromatics, the
increased use of ethanol in response to current market forces and federal and state
policies (including the RFS program) will contribute to lower aromatics levels. This will
occur for two reasons. First, ethanol has historically been blended downstream of
refineries, either as a "splash blend" or as a "match blend." In a splash blend, the ethanol
is mixed with finished gasoline. In a match blend, refiners prepare a special subgrade of
gasoline that, when blended with ethanol, becomes finished gasoline. In recent years,
match blending has increased as refiners have been producing RFG with ethanol, and it is
expected to increase even more as ethanol use expands. A splash blend will reduce
aromatics by about 3 vol% by simple dilution.11 A match blend will reduce aromatics by
about 5 vol%.12 With ethanol use expected to more than double, we expect a significant
11 If the aromatics content of a gallon of gasoline is 30 vol%, adding 10% ethanol dilutes the
aromatic content to about 27 vol%.
12 Section 2.2 "Effects of Ethanol and MTBE on Gasoline Fuel Properties" in the Renewable Fuel
Standard Program: Draft Regulatory Impact Analysis, September, 2006.
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reduction in aromatics levels. Second, with all of this ethanol there will be excess octane
in the gasoline pool. Thus, not only will increased ethanol use decrease aromatics
concentrations through dilution, but refiners will make the economic decision to use
ethanol to reduce or avoid producing aromatics for the purpose of increasing octane.
Because of differences in how refiners will respond to the rapid increase in
ethanol use, it would be difficult to determine an appropriate level for an aromatics
standard at this time. The gasoline market is going through an historic transition now due
to the removal of MTBE, some portion of the MTBE production volume being converted
to other high octane blendstock production, the growth of ethanol use, and the rise in
crude oil prices. Consequently, it is difficult to reliably project a baseline level for the
aromatics pool with any confidence. This is compounded by a great deal of uncertainty
in knowing how much of the market ethanol will capture. Projections by EIA are
significantly higher now than just a few months ago, and Presidential and Congressional
proposals could easily result in 100% of gasoline being blended with ethanol. Second,
aromatics levels vary dramatically across refineries based on a number of factors,
including refinery configuration and complexity, access to other high octane feedstocks,
access to the chemicals market, crude sources, and premium grade versus regular grade
production volumes. Third, without knowing with some certainty the range of aromatics
contents of refineries' gasoline, we cannot determine the greatest degree of emission
reduction achievable, and also cannot make reasonable estimates regarding cost, lead
time, safety, energy impacts, etc. As a result, at this time we would not be able to
determine an appropriate or meaningful aromatics standard.
For the purpose of reducing total toxics emissions, fuel benzene control is far
more cost-effective than control of total aromatics, for a number of reasons. As we
explained in the proposal, reducing the content of other aromatics in gasoline is much
less effective in reducing benzene emissions than reducing fuel benzene content. Based
on the Complex Model,13 roughly 20 times greater reduction in total aromatics content is
needed to achieve the same benzene emission reduction a is achieved by a fuel benzene
reductions. At the same time, to broaden the program to control other aromatics would
result in a significant octane loss that would be difficult and costly to replace. While we
have not yet conducted a thorough refinery modeling evaluation, based on existing
refinery and market information the alternative sources of octane (other than ethanol)
appear to be of limited supply and would be of limited effectiveness in replacing the
octane lost from any fuel aromatics reductions. Furthermore, as noted above, the
uncertainty in the extent to which ethanol will penetrate the market makes it difficult to
project the potential replacement of aromatics with ethanol. Any significant reduction in
aromatics would also affect the gasoline and diesel sulfur reduction programs because
hydrogen, which is used in the desulfurization.
13 Total toxics emissions are as calculated by the Complex Model. This model is the tool used to
determine compliance with the toxics emissions controls in the RFG, Anti-dumping, and MS ATI
programs. Cost estimates for aromatics control and analysis of relative benzene emissions with control of
aromatics and benzene are found in Regulation of Fuels and Fuel Additives; Standards for Reformulated
and Conventional Gasoline; Final rule, Table VI-A6 of the Regulatory Impact Analysis, February 16, 1994.
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Reducing aromatics would also raise other environmental concerns that would
need to be addressed in any regulation. Actions available to refineries for replacing
octane, including adding ethanol, can increase other MSATs, as mentioned above. In
addition, some commenters encouraged the use of the ether derived from ethanol, ETBE,
to make up octane. Any regulatory action that required or was based on the use of ETBE
would likely raise issues of potential groundwater contamination given the groundwater
contamination caused by the use of the chemically similar MTBE.
There may be compelling reasons to consider aromatics control in the future,
especially regarding reduction in secondary PM2 5 emissions, where evidence supports a
role for aromatics in secondary PM2.5 formation.14 Unfortunately, there are limitations in
both primary and secondary PM science and modeling tools that limit our present ability
to quantitatively predict what would happen for a given fuel control. Thus, at this point,
we do not feel that the existing body of information and analytical tools provide a
sufficient basis to determine if further fuel aromatics control is warranted. However, we
do feel that additional research is very important. Test programs and analyses are
planned to address primary PM issues, including those examining the role of aromatics.
Also, more work is underway on how fuel aromatics, including toluene, affect secondary
PM formation, and how aromatics control should be incorporated into air quality
predictive models.15
In summary, we believe that aromatics levels will be falling even without an
aromatics standard, and aromatics control will need to be evaluated in the context of what
might be possible beyond what will occur through the expanded use of ethanol. In
addition, any additional control would be costly and raise a number of other issues which
need further investigation before EPA could responsibly initiate such a control effort.
Thus, we have concluded that additional aromatics control for MSAT purposes is not
warranted at this time.
4.1.2.4 Gasoline Sulfur, RVP, and Other Fuel Properties
What Commenters Said:
Petroleum industry comments related to sulfur control generally expressed the
position that additional control would require expensive upgrades to billions of dollars
worth of equipment just installed for the 30 ppm sulfur standard, and yet would not
produce any significant toxics reductions. Auto industry comments suggest that
measurable emission reductions in HC and MSAT emissions could be had by lowering
gasoline sulfur below 10 ppm, and Toyota submitted a small amount of data to support
this. Comments from state and local governments and environmental/public interest
groups state that EPA has a duty to require the greatest emissions control achievable, and
that lower sulfur gasoline is achievable since the state of California has a more stringent
standard. These comments also state that EPA's analysis of the benefits of low sulfur
14 See Chapter 1 in the RIA for more on current studies on this subject.
15 See Chapter 1 in the RIA for more on current studies on this subject.
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gasoline were inadequate, and echo the auto industry comments that low sulfur gasoline
will reduce HC and MSAT emissions. There were also comments stating that EPA had
not considered distillation parameters and increased detergency as viable ways to reduce
hydrocarbon emissions, in turn reducing emissions of MSATs.
Comments specifically related to more stringent gasoline volatility control came
only from the petroleum industry, and highlighted negative impacts on gasoline supply
that could result. The commenters explained that any additional butanes and pentanes
removed during the summer season would likely exceed refiners' ability to store and re-
blend the material back into winter gasoline due to volatility limits on winter gasoline.
One commenter also supported the position that further volatility control would not
reduce MSAT emissions to a significant extent.
Letters:
Alliance of Automobile Manufacturers (Alliance) OAR-2005-0036-0881
American Petroleum Institute (API)
American Lung Association OAR-2005-0036-0365 (hearing testimony)
Countrymark Cooperative, LLP OAR-2005-0036-0471
Environmental Defense, NRDC, U.S. PIRG, ALA OAR-2005-0036-0868
Flint Hills Resources, LP (FHR) OAR-2005-0036-0862
Independent Fuel Terminal Operators Association (IFTOA)OAR-2005-0036-1007
Nissan Technical Center North America (Nissan) OAR-2005-0036-0825
Toyota Technical Center (TTC) OAR-2005-0036-0773
Our Response:
At the time of the proposal, we did not have adequate data to fully evaluate
additional gasoline sulfur reduction or further volatility control as MSAT reduction
strategies (and the data submitted by Toyota consisted of a very small number of tests).
Since the proposal, we have completed a small fuel effects test program in cooperation
with several automakers to help evaluate the usefulness of fuel property changes as
emission controls on Tier 2 vehicles. These data suggest that reducing gasoline sulfur to
a level of 6 ppm would bring reductions in regulated criteria pollutants, but not in total
toxics as defined by the Complex Model. The data also suggest that reducing gasoline
volatility from 9 to 7 RVP under normal testing conditions (75°F) may actually increase
exhaust emissions of several air toxics. The test program did not examine the impacts of
fuel volatility on evaporative emissions. We will be using this and other data as it
becomes available to consider future action on further gasoline sulfur control. More
details on the test program and its results are available in Section 6.11 of the RIA.
For MSAT control programs, the Clean Air Act requires EPA to consider
technological feasibility as well as cost and other factors. We believe there would be
significant costs in requiring another large step down in sulfur below the recently
implemented standard of 30 ppm, costs far greater than those associated with
incrementally more stringent average benzene standards, which we concluded in this rule
would be unreasonable. While we can not rule out further action on gasoline sulfur levels
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in the future, much more testing and analysis would be required before EPA would
propose such action. Furthermore, refineries are in the process of implementing the
gasoline sulfur control standards associated with the Tier 2 program, the on-highway
diesel rule, and the nonroad diesel rule. EPA considers it unreasonable to potentially
interfere with the implementation of these important standards by adopting another
desulfurization standard to apply in much the same time frame (see Sierra Club, 325 F.
3d at 380). Until EPA can more fully evaluate the real-world impacts of these rules on
refineries, it is unreasonable to adopt a further standard for gasoline sulfur.
4.1.2.5 Diesel Fuel
What Commenters Said:
One group of commenters stated in joint comments that they believe that EPA
needs to do more to protect human health and the environment from the effects of diesel
exhaust emissions. While they specifically mention actions to accelerate the introduction
of cleaner diesel engines, they do not suggest any additional changes to diesel fuel. Some
commenters noted that polyaromatic hydrocarbons (PAHs) and nitro-PAHs are a
particularly harmful component of diesel exhaust, and support control of these emissions
either directly or through control of PAH content in diesel fuel. Another commenter, a
refiner, states that further diesel fuel controls are not warranted.
Letters:
Environmental Defense, NRDC, U.S. PIRG, ALA OAR-2005-0036-0868
ExxonMobil Refining & Supply Company (XOM) OAR-2005-0036-0772
International Truck and Engine Corporation (International) OAR-2005-0036-0826
Marathon Petroleum Company LLC OAR-2005-0036-1008
New York State Department of Environmental Conservation OAR-2005-0036-
0722
Our Response:
EPA did not propose additional controls on diesel exhaust emissions or diesel fuel
for MSAT control. We believe that existing EPA regulations for highway and nonroad
diesels will achieve the greatest reductions currently achievable in MSAT emissions from
diesel engines. The actions refiners are taking to produce ultra-low sulfur diesel fuel (15
ppm sulfur) are expected to reduce the PAH content in diesel fuel.16 In addition,
available data indicate that the advent of exhaust emission controls on diesel engines
under the recent diesel programs will reduce exhaust PAH, regardless of any changes to
diesel fuel. As the content of PAHs in the fuel as well as the amount emitted in engine
exhaust decreases, emissions of nitro-PAHs will also decrease due to decreases in the
precursor PAH emissions.
16 Control of Emissions of Air Pollution from Nonroad Diesel Engines and Fuel - Final Rule,
Section 5.9.4 of the Regulatory Impact Analysis, June 29, 2004.
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EPA will continue to monitor MSAT issues related to diesel engines and fuel.
For example, there is a large program from the Health Effects Institute (HEI) just starting
to characterize regulated and unregulated emissions (and their health effects) from
engines meeting the 2007 and 2010 emission standards, including measurement of many
PAH and nitro-PAH compounds.17 This project has numerous sponsors, including EPA.
In conclusion, existing diesel regulations will reduce PAH (and nitro-PAH)
emissions. At this time, we are not aware of further diesel fuel controls that could
significantly affect MSAT emissions and commenters did not offer specific information
to the contrary. Consequently, we have focused our fuel-related MSAT action on
gasoline benzene, as proposed, while continuing our efforts to better quantify the
reductions in PAH (and nitro-PAH) emissions from diesel engines meeting the 2007 and
2010 standards.
4.2 Implementation Issues
4.2.1 Replacement of Existing Standards
What Commenters Said:
A number of commenters supported the proposal to consolidate and simplify the
regulatory provisions by using the Tier 2/Gasoline Sulfur rules as the sole regulatory
mechanism for implementing the RFG and anti-dumping NOx requirements, and the
proposed benzene rule as the sole regulatory mechanism for implementing the RFG and
anti-dumping toxics requirements. In addition, in light of the proposed benzene standard,
some commenters stated their support for the elimination of the MSAT1 requirements,
and for avoiding adjusting the RFG MSAT1 baselines as required by EPAct absent a
more stringent toxics program. Several commenters added that they believe this proposal
is an excellent example of reducing the regulatory burden by removing regulations that
are no longer needed because of changed circumstances. Some commenters pointed out
that the Agency has the opportunity to reduce the considerable compliance and
enforcement burden placed on it, as well as on the industry. At least one commenter
noted that these rule simplifications will not result in any environmental degradation, and
another noted that the removal of requirements made obsolete by instituting the MSAT2
program will reduce the chances that this additional requirement will further constrain
gasoline production.
Other commenters stated that they do not believe that EPA should revoke the
MS ATI anti-backsliding and anti-dumping provisions, and urged EPA to retain the RFG
and anti-dumping NOx performance standards rather than rely on the federal gasoline
sulfur program. One of these commenters stated that EP A's justification for this proposed
action was too brief, and that in any event such action is not appropriate for this MSAT-
related rulemaking.
Advanced Collaborative Emission Study, Health Effects Institute, Cambridge, MA.
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Letters:
American Petroleum Institute (API) OAR-2005-0036-0366, 0367
BP OAR-2005-0036-0824,0837
Chevron Corporation (Chevron) OAR-2005-0036-0847
ExxonMobil OAR-2005-0036-0772, -1013
Flint Hills Resources, LP (FHR) OAR-2005-0036-0862
Marathon Petroleum Company, LLC (MFC) OAR-2005-0036-1008
National Petrochemical Refiners Association (NPRA) OAR-2005-0036-0809
New York State Department of Environmental Conservation (NY DEC) OAR-2005-
0036-0722
Northeast States for Coordinated Air Use Management (NESCAUM) OAR-2005-
0036-0993,-0369
Regional Air Pollution Control Agency (RAPCA) OAR-2005-0036-0771
STAPPA/ALAPCO OAR-2005-0036-0836, -0378
Our Response:
A detailed discussion of how the toxics and NOx requirements for CG and RFG
will be met under the MSAT2 program is provided in Chapter 6.12 of the RIA for this
rulemaking. Based on analysis of gasoline batch data from recent years as well as our
projections of what refiners will be doing to comply with MSAT2, we believe
compliance with MSAT2 will reduce air toxics emissions significantly below the MSAT1
baselines as well as below the RFG and anti-dumping toxics requirements. Therefore,
these existing regulatory programs will effectively be superseded and become redundant.
Since we believe that the benzene program will be significantly more stringent than the
existing programs, we are waiving the requirements for demonstration of compliance
with previous air toxics programs.
We also believe that the Gasoline Sulfur/Tier 2 program is reducing NOx
emissions to a significantly greater degree than are the NOx performance standards for
RFG and CG. Gasoline sulfur has the largest impact on NOx emissions in modern
vehicles equipped with three-way exhaust catalysts — now comprising more than 95% of
the gasoline fleet — under the Complex Model used to certify fuel to the NOx standards.
Therefore the reduction of gasoline sulfur to 30 ppm average nationwide is causing all
gasoline to far exceed the NOx emission performance standards required under the RFG
and anti-dumping programs. Given this fact, we believe that the existing regulations
have become unnecessary, and we believe that it is appropriate to take action to simplify
our regulations to waive requirements for demonstration of compliance with the NOx
performance standards for RFG and CG.
In response to the comment about the appropriateness of taking action relating to
the sulfur control program in the context of this MSAT-related rule, we disagree. We
believe that taking this action is necessary and appropriate now as we are making
corresponding changes to the regulations for air toxics performance standards. Initiating
a separate rulemaking action for this limited purpose at a later date would be inefficient
for EPA and for stakeholders.
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4.2.2 Batch by Batch Testing
What Commenters Said:
Several commenters stated that they oppose the requirement to test each batch of
conventional gasoline for benzene. These commenters believe every-batch testing will
involve unnecessary time and record keeping and will create an unnecessary financial
burden for small refiners and blenders. They state that they would prefer to test monthly
composite samples since the standard is an annual average and there is no per gallon
benzene limit. These commenters also stated that they support the proposed ability for
refiners (and importers) to release conventional gasoline prior to getting the results of any
benzene testing, because with annual average compliance, there will generally be time to
account for off-spec gasoline before the end of the annual reporting period, and thus there
is no need to delay deliveries while waiting for test results.
Letters:
Caribbean Petroleum OAR-2005-0036-1010
Colonial Oil Industries, Inc. (Colonial) OAR-2005-0036-0990
Gladieux Trading & Marketing Co., L.P. (Gladieux)OAR-2005-0036-0972
U.S. Oil & Refining, Co. (USOR) OAR-2005-0036-0992
Our Response:
We proposed to require every-batch sampling for CG benzene under this program,
(see 71 FR 15893). RFG already is every-batch tested, and the results must be available
before the batch leaves the refinery to support effective enforcement of RFG's 1.3 vol%
benzene per gallon cap. For CG, we are concerned about the potential for benzene-rich
blendstocks to be added downstream, since the new program does not have any
downstream testing or reporting requirements. Requiring every-batch testing for CG will
allow for closer monitoring of the movement of high benzene streams, and we will be
able to better discern if high benzene batches originated at the refinery, or downstream.
With composite testing, it would be significantly more difficult to determine the source of
any high benzene gasoline found downstream. Thus, we see every-batch testing for all
gasoline as a necessary part of the gasoline benzene program.
For CG, every-batch sampling is already required for gasoline sulfur, and will be
well under way for small refiners by the time small refiners are required to comply with
the benzene program requirements. Thus, there may be a small incremental cost for
additional benzene testing for those refiners that currently determine CG benzene levels
from a composite sample. However, we do not believe that these additional costs will be
large; commenters that raised the issue of this potential additional cost did not provide
any data or analytical support for this concern. We are finalizing every-batch benzene
testing for all gasoline.
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As we proposed, we are not requiring that the results for CG be available before
the batch leaves the refinery, for the reasons given by the commenters.
4.2.3 Reporting, Recordkeeping, Surveys
What Commenters Said:
Several commenters stated that if the Agency deletes MS ATI, RFGNOx and
toxics, and anti-dumping NOx and toxics, as proposed, then gasoline batch testing,
reporting and recordkeeping regulations must be revised. The commenters stated that
they believe that EPA may continue to require sulfur and benzene content testing,
reporting and recordkeeping for every gasoline batch, but that there would be no
regulatory purpose to continue testing, reporting and recordkeeping for RVP, distillation,
olefins, oxygen, and aromatics for CG and for winter RFG. They believe that RVP,
distillation, olefins, oxygen and aromatics would only have a regulatory purpose for RFG
summer VOC regulatory compliance.
In addition, some of these commenters stated that the RFGNOx and toxics retail
survey regulations must be revised. The commenters suggested that, if the MSAT2
benzene standard is effective beginning in 2011, the RFG toxics retail compliance
surveys should be discontinued after 2010 because there would not be a RFG toxics
emissions standard to "ratchet" down in case of a failure. Similarly, commenters stated
that RFGNOx retail compliance surveys should be discontinued because there would not
be a RFG NOx emissions standard to ratchet down in case of a failure. These
commenters noted that in 2010, the RFG Survey Association will submit a plan for 2011
for EPA approval that excludes toxics, and that the RFG Survey Association will submit
a plan for 2007 for EPA approval that excludes NOx.
Letters:
American Lung Association (ALA) OAR-2005-0036-0365 (hearing comments)
Marathon Petroleum Company, LLC (MFC) OAR-2005-0036-1008
National Petrochemical Refiners Association (NPRA) OAR-2005-0036-0809
Our Response:
In the proposal we stated that certain reporting and recordkeeping requirements
would be modified or eliminated because of the benzene standard. Compliance with the
RFG and anti-dumping toxics standards will be achieved through the benzene control
program. In addition, compliance with the RFG and anti-dumping NOx standards will be
achieved through the gasoline sulfur program. Because compliance with the toxics and
NOx requirements will be achieved through other programs, many of the reporting and
recordkeeping requirements are being streamlined by the final rule. However, sampling,
testing, and reporting of all of the current fuel parameters will continue to be required.
This benzene control program is merely the means by which compliance with the RFG
and anti-dumping controls is being measured; the individual rules are still in effect. EPA
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is obligated to continue to monitor how refiners comply (through fuel composition
changes) and how other toxics emissions may be affected by the benzene and gasoline
sulfur rules. The Agency's authority to collect information on the fuel parameters that
affect the toxics (and NOx) control programs also remains. Continued collection of all of
the fuel parameters will facilitate future toxics evaluation activities.
Commenters also suggested eliminating the toxics and NOx retail surveys that are
currently carried out for RFG because there would not be RFG toxics or NOx emissions
standards to "ratchet" down in case of a failure because the toxics and NOx requirements
were being met by the gasoline benzene and sulfur programs. A discussion of the origin
of the RFG survey program is included in Chapter 6.12 of the RIA. The surveys use fuel
parameters of RFG sampled from retail stations to estimate VOC, NOx, and toxics
emissions. There are also fuel benzene and oxygen content surveys. If a survey is
"failed," meaning that the survey shows the fuel to be out of compliance, the
requirements are "ratcheted down" and gasoline sent to the area must meet a more
stringent standard. Because we are finalizing, as proposed, provisions that make the
gasoline sulfur program the sole regulatory mechanism used to implement gasoline NOx
requirements, and the benzene control program the sole regulatory mechanism used to
implement the toxics requirements of RFG18 and anti-dumping, we agree that the NOx
and toxics surveys are no longer needed, and are no longer required.
4.2.4 Accounting for Downstream Oxygenates
What Commenters Said:
Several commenters stated that the current regulatory option to include
downstream oxygenate addition in RFG, anti-dumping and MS ATI compliance
calculations should be retained in the MS AT2 program, especially considering the
expanding use of ethanol due to the Renewable Fuel Standard in the EPAct. Commenters
further noted that since ethanol serves as a diluent, much the way that MTBE has
historically, allowing the inclusion of downstream ethanol addition to be included in the
calculation is justified.
Another commenter said that it believes that allowing the use of oxygenates in the
compliance formula may enable some small refiners to comply with the 0.62 vol%
benzene standard. The commenter also noted that since Congress required the increased
use of ethanol in gasoline in EPAct, EPA should promote the use of ethanol and other
oxygenates whenever possible.
Letters:
Countrymark Cooperative, LLP OAR-2005-0036-0471
ExxonMobil OAR-2005-0036-0772, -1013
Flint Hills Resources, LP (FHR) OAR-2005-0036-0862
National Petrochemical Refiners Association (NPRA) OAR-2005-0036-0809
18
The 1.3 vol% per gallon cap on RFG benzene remains.
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Our Response:
We are allowing ethanol added downstream of a refinery to be included in a
refinery's benzene calculation for all purposes under MSAT2. The refinery would be
required to meet requirements specified in the RFG and anti-dumping regulations, as
applicable, regarding documentation, agreements with the oxygenate blender, etc. We
believe that adding ethanol and complying with other fuel requirements, e.g., the Energy
Policy Act and related regulations, are part of the refinery's business as usual and are
reasonable to permit as a part of this program.
4.2.5 Pre-emption
What Commenters Said:
One commenter stated that this rulemaking as proposed would remove the option
of independent state regulation of gasoline benzene content from the state's list of
potential tools for addressing air quality. The commenter stated that it believes that an
option for state regulation should be preserved.
Other commenters noted that no state or political subdivision, other than
California, may adopt a benzene content, exhaust toxics, or total toxics standard for
gasoline that is different from the federal standard without requesting a waiver.
Commenters cited statements from several rules where the Agency acknowledged this
fact. The commenter noted that waivers cannot be granted by EPA because state benzene
and toxics standards for gasoline are not necessary to achieve a NAAQS.
Many commenters also noted that because the regulations will affect virtually all
of the gasoline in the United States, and since gasoline produced in one area is often
distributed to other areas, federal rules should preempt State action to avoid potentially
conflicting regulations.
Letters:
Marathon Petroleum Company, LLC (MFC) OAR-2005-0036-1008
National Petrochemical Refiners Association (NPRA) OAR-2005-0036-0809
Wisconsin Department of Natural Resources (WDNR) OAR-2005-0036-0828
Our Response:
In the NPRM, we stated that authority for the gasoline benzene program comes
from the Clean Air Act, specifically section 21 l(c), which includes a preemption of state
fuel programs in section 21 l(c)(4). [71 FR 15871] We believe that we are thus required
to preempt any state (except for California) from further regulating benzene in those
areas. The nationwide benzene program finalized today therefore preempts all states
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(except California which is exempt from preemption under 21 l(c)) from regulating
gasoline benzene content.
4.2.6 Treatment of Transmix
What Commenters Said:
One commenter stated that it supports EPA's proposal to omit transmix
processors from the benzene standard because they have no control over the benzene in
the transmix streams they receive and typically are too small to invest in benzene
extraction or treatment equipment that may or may not be needed. This commenter
believes that the benzene in the gasoline they receive as feedstock would have been
accounted for at its point of production.
The commenter stated that it believes that EPA indicated that if outside blending
components are added to transmix-derived gasoline, the final blend should be subject to
the new standard. The commenter stated that since benzene in the transmix-derived
gasoline would have been accounted for at its production point, EPA should consider
requiring only the outside material added to the transmix-derived gasoline meet the new
standard and not the completed blend. The commenter further stated that it believes that
the product transfer document that the transmix processor receives for the blending
component could indicate the benzene level of the product, thus allowing the transmix
processor to blend the material in without having to invest in testing equipment that it
otherwise would not need.
Letters:
Gladieux Trading & Marketing Co., L.P. (Gladieux)OAR-2005-0036-0972
Our Response:
We had proposed that transmix processors would be subject to the benzene
standard if they add gasoline blending components to the gasoline produced from
transmix (see 71 FR 15891). We agree with the comment that only the blending
component added to the gasoline produced from transmix should be subject to the
standard, for the reasons stated by the commenter, and we are finalizing this provision.
Thus transmix processors are not subject to the benzene standard unless they add other
blendstocks to the gasoline produced from transmix. If they do this, they will only be
subject to the benzene requirement for the blendstock added, not for the entire blend
(transmix plus blendstock). This is consistent with the treatment of transmix in other
EPA gasoline programs.
4.2.7 Exemptions for U.S. Territories
What Commenters Said:
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ExxonMobil commented that it believes that U.S. Pacific territories should be
exempt from the MSAT2 requirements. The commenter noted that when EPA
promulgated MS ATI, the Agency exempted the Pacific territories of Guam, American
Samoa, and the Commonwealth of the Northern Mariana Islands (at §80.820(d)), but the
MSAT2 proposal does not appear to exempt these territories. The commenter noted that
EPA has been exempting these territories from most of the fuel specification
requirements imposed on the mainland U.S. since their source of gasoline supply is
altogether different, and the environmental issues not as prevalent. The commenter stated
that it believes that EPA should exempt these territories from the MSAT2 requirements,
as was done for MS ATI, Highway and Nonroad diesel, and Tier 2 Gasoline.
Letters:
ExxonMobil OAR-2005-0036-0772, -1013
Our Response:
As discussed further in section VI.B.I of the preamble to the final rule, gasoline
produced for use in the American territories of Guam, the Northern Mariana Islands, and
American Samoa is not subject to the gasoline benzene standards. Gasoline produced for
use in these areas is currently exempt from the MSAT1 standards, and for the same
reasons we discussed in the MSAT1 final rule (66 FR 17253, March 29, 2001), we are
exempting gasoline produced for use in these areas from this rule.
4.3 Lead Time for Compliance
What Commenters Said:
Many commenters stated that they believe that the January 1, 2011 start date is
reasonable. Some commenters, however, asked that EPA give serious consideration to
earlier implementation. Some of these commenters noted that Canada implemented
controls on gasoline benzene (including a per-gallon cap) 18 months after rule adoption.
Some also suggested that increases in renewable fuel use could expedite compliance with
the MSAT2 standards by several years. The Municipality of Anchorage urged EPA to
speed the implementation of benzene limits in gasoline supplied in Alaska.
On the other hand, many other commenters stated that EPA should provide a full
four years of lead time for refiners and importers to comply with the standard, as in past
regulatory programs. These commenters stated that they believe that the lead time
provided by the proposed rule would create difficulties and urged that, if the rule is to be
finalized in February 2007, the program start date should be January 1, 2012 to allow for
a full four years of lead time. A few stated that they would support a compliance date
that is exactly four years after the effective date of the final rule. The four years are
needed for the concept reviews, design, engineering, permitting and construction of
refinery facilities necessary for compliance. They believe that an effective date any
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earlier than this would put undue time pressure on the industry and would not allow
sufficient time for optimally developing and integrating the changes required to meet the
benzene standard. Some of these commenters pointed to other overlapping regulatory
programs as a reason to extend the leadtime.
Letters:
American Petroleum Institute (API) OAR-2005-0036-0366, 0367
(Municipality of) Anchorage Department of Health and Human Services Anchorage
OAR-2005-0036-0976
BP OAR-2005-0036-0824,0837
Environmental Defense, NRDC, U.S. PIRG, ALA OAR-2005-0036-0868
ExxonMobil Refining & Supply Company OAR-2005-0036-0772
Independent Fuel Terminal Operators Association (IFTOA)OAR-2005-0036-1007
Marathon Petroleum Company LLC OAR-2005-0036-1008
National Petrochemical Refiners Association (NPRA) OAR-2005-0036-0809
New Jersey Department of Environmental Protection, Division of Air Quality (NJ DEP)
OAR-2005-0036-0829
New York State Department of Environmental Conservation (NYDEC) OAR-2005-
0036-0722
NESCAUM OAR-2005-0036-0993
STAPPA/ALAPCO OAR-2005-0036-0836
Our Response:
Section 202(1)(2) requires that we consider lead time in adopting any fuel control
for MSATs. We proposed that refiners and importers meet the 0.62 vol% average
benzene standard beginning January 1, 2011 (January 1, 2015 for small refiners). This
date was based on the industry experience that most of the technological approaches that
we believe refiners will apply - rerouting of benzene precursors around the reformer and
use of an existing isomerization unit - will take less than two years. The more capital
intensive approaches - saturation and extraction - generally take two to three years to
complete. The January 1, 2011 date provides nearly four years of lead time. We believe
this is an appropriate amount of lead time, even taking into account that other fuel control
programs (notably the Nonroad Diesel program) will be implemented in the same time
frame.
Some commenters supported earlier start dates, referring in some cases to the
experience of Canada in regulating gasoline benzene. However, these comments failed to
acknowledge the less stringent Canadian standard (0.95 vol%) which naturally takes less
lead time to implement. No commenter provided information that challenged our
assessments of the technical lead time for the range of benzene control approaches that
will be implemented. Given that the technologies that need to be used to comply with
this standard all require less time than the lead time available, we continue to believe that
a January 1, 2011 start date is appropriate. Furthermore, an important aspect of the
design of this program as proposed is the recognition that not all of the benzene reduction
would occur at once. As discussed in detail in section VI.A.2.b of the preamble, we
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expect that individual refiners will use the ABT program to schedule their benzene
control expenditures in the most efficient way, using the early credit and standard credit
provisions. This will essentially create a gradual phasing-in of the reductions in gasoline
benzene content, beginning well before the initial compliance date of January 1, 2011 and
spreading out industry-wide compliance activities over several years. Therefore, we are
finalizing a start date of January 1, 2011 for the average standard, as proposed.
4.4 Costs
4.4.1 General
What Commenters Said:
The American Petroleum Institute (API) commented that it believes that EPA
underestimated capital and total costs of the proposed gasoline benzene standard. The
commenter noted that EPA estimates a total capital cost for its proposed 0.62 vol%
standard with ABT program to be $500 million (in 2003 dollars). API commented,
however, that it believes that the capital costs will be considerably higher - by a factor of
3 - and it pointed to an estimate made by Baker and O'Brien's of $1, 476 million (in
2006 dollars) [page 43]. A refiner asserted that capital costs would be 2 - 3 times greater
than EPA's estimates based on their experience installing benzene control technology.
Another refiner said that its own capital cost estimate for complying with the proposed
benzene control standard could reach $250 million for its refineries which comprise about
6% of the U.S. gasoline pool, which suggests that the EPA capital cost estimate was
understated by a factor of 3 - 4.
API further commented that in the EPA-estimated costs (capital and operating)
for a 0.62 volume percent benzene average proposed standard, no compliance margin was
assumed, nor was the degree of likely ABT program market efficiencies assessed. The
commenter stated that it believes that this alone could lead to an understatement of the
proposed program costs and impacts. The commenter noted that the API Baker and
O'Brien report has incorporated provisions for these aspects by modeling at 0.60 volume
percent and assuming a 10 volume percent unused credit balance for compliance margins
and market place trading efficiencies.
API further commented that the analogous Baker and O'Brien cost curve (see first
figure on page 46 of the Baker and O'Brien report) also suggests that a portion of the
gasoline pool can meet the 0.62 volume percent benzene target at little or no cost, but
significantly less than 50 volume percent of the pool. The commenter also stated that the
Baker and O'Brien curve indicates tail end costs (i.e., costs to refineries at the tail end of
the cost distribution curve) in the range of 4 to 7 cents per gallon. Other reasons cited
include EPA's underestimating of benzene control costs, include grossly underestimating
the costs for the highest cost refiners, and that more than half of refiners would incur no
cost at all.
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API noted that EPA's refinery linear programming cost LP modeling used 2000
as the base year, and only 4.3 billion gallons of ethanol were assumed in 2010. The
commenter stated that it believes that these two key variables may impact the quality of
the assessment made by EPA. API further commented that the natural gas and crude oil
prices that were taken from the EIA/AEO 2005 (e.g., as stated on page 922 of Chapter 9
of the PJA), crude oil prices were assumed to be $27 per barrel for the EPA study.
One commenter stated that it believes that EPA's estimate of the additional cost
of the new benzene standard of an average of 0.13 cents per gallon has been
underestimated. It estimates that its after-tax costs will be as high as 0.30 cents per
gallon.
Letters:
American Petroleum Institute (API) OAR-2005-0036-0366, 0367
ExxonMobil OAR-2005-0036-0772, -1013
Marathon Petroleum Company, LLC (MFC) OAR-2005-0036-1008
Our Response:
Several commenters stated that our capital and overall cost estimates are too low,
submitting their own cost study as support. In Section 9.7 of Chapter 9 of the final RIA,
we summarize the methodology and final costs of the oil industry's cost study of the
proposed gasoline benzene program. That section of the final RIA compares the
methodology and cost results of the industry cost analysis to our final rule cost analysis,
highlighting the differences between our two studies and our basis for projecting lower
costs than are projected in the industry study.
The cost analysis conducted by API estimated an aggregate capital cost of 1,476
million dollars while in the proposed rulemaking we reported that the refining industry
would need to invest 500 million dollars in new capital costs. In the draft RIA for the
proposed rule, we acknowledged that our capital cost estimates did not include any
capital costs for octane recovery and additional hydrogen production, although we
committed to estimate them and include them as part of our final rule cost estimates.
For our final rule cost analysis, we reviewed our capital cost estimates that serve
as inputs for our refinery modeling analysis. In many cases we updated our capital cost
estimates to reflect the most recent data available, capturing the recent run-up in capital
costs that has occurred as capital costs have increased faster than inflation. We also
estimated the capital costs associated with octane recovery and additional hydrogen
demand that is estimated to occur due to the application of the benzene control
technologies. Our capital cost estimate for our final rule benzene program is 1,100
million dollars.
Our new capital cost estimate is still lower than API's capital cost estimate and
we identified four reasons why. First, API modeled a more stringent benzene annual
average standard than required in our final benzene standard. API modeled the cost for a
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0.60 vol% average benzene standard as opposed to our final rule benzene program which
requires that refiners comply with a 0.62 vol% annual average benzene standard. The
more stringent average benzene standard modeled by API would require that some
refiners invest in a more expensive benzene control technology, thus raising the estimated
capital cost. This difference between our two studies is offsite slightly by our adoption of
a 1.3 vol% maximum average benzene standard. However, as indicated by our cost
comparison summarized in Chapter 9 of the RIA, the maximum average standard adds
much less to the cost than the more stringent average benzene standard.
The second reason the oil industry's cost study estimates higher capital costs is an
assumption that refiners would hold on to a substantial amount of credits, and therefore
overcomply significantly with the 0.62 vol% average standard. As a result of this
assumption, the average benzene level estimated by their cost study was 0.56 vol%
benzene (which is much lower than the average benzene standard that they modeled),
resulting in higher capital costs. The ABT and other provisions provided by the benzene
program is expected to reduce the need for refiners to store up extra credits; as a result we
believe refiners are likely to target complying with the 0.62 vol% average benzene
standard instead of significantly lower benzene levels. Thus, any deeper benzene
reductions would be unnecessary.
The third reason why the oil industry cost analysis estimated higher capital costs
is that it assumed that when a refiner put in a benzene extraction unit, it would install a
unit which would also extract xylene and toluene (called BTX extraction), which
significantly increases the capital costs associated with extraction. We considered
making a similar assumption when we began our process for estimating the costs for
benzene control, but a vendor of benzene extraction technology advised against such an
assumption. The vendor said that most refiners would only put into place the necessary
capital for benzene extraction because so much new xylene extraction capacity is being
installed overseas, and toluene is a less desirable aromatic compound. In any case, if a
refiner were to elect to extract aromatic compounds other than benzene, it would not be a
cost of this rule, but would instead be based on a refiner's desire to begin participating, or
to further participate, in those markets.
The fourth reason for the oil industry's higher capital cost estimates is that the
study used very high offsite factors19 and also added a contingency factor for their capital
costs. Based on actual offsite cost information from an engineering and construction
19 Onsite costs are for the primary unit including the distillation column, heat exchangers, pumps, heaters,
piping, valves and instrumentation. Offsite costs are for administration and control buildings, cooling
tower, electrical substation and switchgear, water and waste treatment facilities, feedstock and product
storage and loading and offloading, spare equipment kept onsite and catalysts. Normally refiners estimate
offsite costs for each project which can vary from zero to a factor several times greater than the onsite
costs. For national fuel control programs, cost estimation is averaged and a factor is used to indicate the
fraction that offsite costs comprise of onsite costs. This factor is applied for all the technologies requiring
capital investment and is expressed as a single onsite and offsite capital cost estimate.
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company, offsite costs range from 10 to 80 percent of the onsite costs,20 yet API
consistently assumed an offsite factor at the highest end of this range. In addition to their
capital cost estimate, their analysis adds a 15 percent contingency cost factor. However,
contingency cost factors are usually reserved for cost estimates with a high degree of
uncertainty. Because the capital costs associated with these benzene control technologies
are so well known, it is inappropriate to tack on a contingency cost factor here.. Thus, we
believe that the use of high offsite factors and contingency factors overestimates capital
costs.
Our higher capital costs contributed to increasing our per-gallon costs, but our
per-gallon costs also increased for other reasons. For our final rule cost analysis, we
assumed a higher crude oil price of $47 per barrel instead of the $27 per barrel crude oil
price used for the proposed rule. The projected natural gas prices are also higher for the
final rule cost analysis compared to those used for the proposed rule cost analysis. One
commenter stated that our LP modeling used 2000 as the base year, and only 4.3 billion
gallons of ethanol were assumed in 2010. The commenter stated that it believes that
these two key variables may impact the quality of our cost assessment. For our final rule
analysis, we estimated costs based on 9.6 billion gallons of ethanol entering the gasoline
pool. Unlike the oil industry cost analysis, our octane costs take into account this large
volume of ethanol in the gasoline pool. Our LP refinery model still uses the year 2000 as
the base year. However, the LP refinery cost model was primarily used to generate
octane recovery and hydrogen supply costs. Our refinery-by-refinery cost model, which
is the prime tool used for estimating the costs of our program, was updated for our final
rule analysis to be calibrated against year 2004 gasoline volumes and gasoline benzene
levels.
All these changes, along with others, resulted in our per-gallon benzene control
costs increasing by about a factor of two compared to the benzene control costs estimated
for the proposed rule.21 Consistent with the comments, the highest modeled costs of
compliance in each PADD for our final rule cost analysis, which now includes a 1.3 vol%
maximum average standard, were also in the 4 to 6 cents per gallon range, although we
discussed a benzene control strategy which we did not model that would mean much
lower benzene control costs in practice (see section 9.6.1 of Chapter 9 of the RIA). In
addition, we conservatively estimated costs for reformate extraction although refineries
may extract benzene without regard for the rule's requirements due to rising benzene
demand by the petrochemical industry. Thus, both our cost studies may tend to
overestimate compliance costs for some refineries.
Commenters from the oil industry also stated that our proposed cost analysis
estimated too high a percentage of refineries that could comply with the benzene program
at no cost. Our final rule cost analysis shows that less than 40 percent of the oil industry
20 Rees, Conway, Senior Process Director, Fluor; Technical Session: Considerations when Revamping for
ULSD, Hydroprocessing Principles and Practices, National Petrochemical and Refiners Association
Question and Answer Forum, October 2006.
21 About 20 percent, or 0.03 cents per gallon, of the higher cost we are reporting for the final rule is
attributed to the addition of the 1.3 vol% maximum average benzene standard.
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can comply with no or less than zero cost, which seems consistent with the API cost
study.
One commenter stated that it believes that EPA's estimate of the additional cost
of the annual average benzene standard of an average of 0.13 cents per gallon has been
underestimated because it estimates that its after-tax costs will be as high as 0.30 cents
per gallon. We presented the before-tax per-gallon costs averaged over only the refineries
which are projected to take steps to reduce their benzene levels, which is 0.40 cents per
gallon. This 0.40 cents per gallon cost is higher than that estimated by the commenter,
and if we had expressed the costs on an after-tax basis, our costs would be higher still.
However, no conclusion can be reached by this comparison since our average per-gallon
cost is determined by the average costs for many diverse refineries and we do not know
what benzene control technologies that the commenter assumed for its comments.
4.4.2 Reporting of Costs
What Commenters Said:
The Alaska Department of Environmental Conservation (ADEC) commented that
it would appreciate any more specific information from EPA about cost impacts expected
from this rule.
Letters:
Alaska Department of Environmental Conservation (ADEC) OAR-2005-0036-
0975
The commenter stated that it would appreciate any more specific information
from EPA about cost impacts expected from this rule. In Chapter 9 of the preamble and
in Chapter 9 of the draft RIA for the proposed rule, detailed benzene control cost
estimates were provided for the proposed fully phased-in benzene program as well as
other benzene programs considered. Also the cost input information was provided in
Chapter 9 of the draft RIA for specific benzene control technologies. The cost impact to
refiners and consumers was estimated by the Economic Impact Analysis (EIA) as
summarized in Chapter IX of the preamble and Chapter 13 of the RIA.
For the final rulemaking, updated, detailed cost estimates are provided for the
final benzene program in Chapter 9 of the preamble and Chapter 9 of the final RIA. The
cost estimates were updated from those in the proposed rule to reflect more recent capital
cost information, more recent projections for utility prices, crude oil prices, benzene
prices and to model the final benzene program which includes a 1.3 maximum average
standard. The EIA estimates the costs to refiners and consumers in Chapters IX of the
preamble and Chapter 13 of the RIA.
4.5 Refinery Modeling
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What Commenters Said:
The commenter noted that proposed rule is entirely dependent on modeled
predictions to achieve its reduction goals, with a broad, flexible ABT program and a
minimal program for monitoring and enforcing compliance.. The commenter stated that it
believes that, if refiners do not act as the model predicts or if conditions change, the
benzene reductions may not occur in the manner and to the degree predicted by the
model.
API also commented that it believes that EPA presumed a large number of
facilities will install benzene extraction units or revamp their existing extraction units.
While this is a low cost approach, the commenter noted, it keys on an overoptimistic
presumption that there will be full utilization and need of the extracted components in the
world market. API commented that it believes that greater utilization of benzene
saturation and isomerization strategies will be taken to preserve supplies.
Lastly, the commenter stated that it believes that EPA failed to recognize that the
public cost of environmental programs is not the average cost across the entire industry
but the incremental cost that must be paid to acquire the final increment of gasoline
supply; the commenter further noted that even using EPA's low cost estimates, this
incremental cost is 10 times the average cost projected by the Agency modeling.
Letters:
American Lung Association (ALA) OAR-2005-0036-0365 (hearing comments)
American Petroleum Institute (API) OAR-2005-0036-0366, 0367
Marathon Petroleum Company, LLC (MFC) OAR-2005-0036-1008
Our Response:
One commenter stated that it believes that EPA presumed a large number of
facilities will install benzene extraction units or will revamp their existing extraction
units. While this is a low cost approach, the commenter noted, it keys on an
overoptimistic presumption that there will be full utilization and need of the extracted
components in the world market. The commenter went on to say that it believes that
greater utilization of benzene saturation and isomerization strategies will be taken to
preserve gasoline supplies. Our final rule analysis projects a lower reliance on benzene
extraction than the proposed rule analysis. However this change in the expected use of
benzene extraction is more due to the higher extraction capital costs estimated for the
final rule analysis compared to the proposed rule analysis than any issues associated with
benzene supply. Also, as we pointed out in the energy and supply discussion of the RIA
and in section 4.8 of this response to comment document, the sale of the volume of
benzene into the petrochemical market, which likely will phase in over time because of
the ABT program, may occur independently of this rule's requirements based on the
projected increased benzene demand from the petrochemical sector over this same time
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period. Moreover, as further explained in that response, even if the amount of benzene
extraction occurring in this time frame is more than the petrochemical market can absorb,
rather than there being a large decrease in benzene price due to oversupply, we would
expect that the marginal cost benzene producers would reduce their benzene production.
These marginal cost benzene producers are those which convert toluene into benzene.
They would be expected to reduce benzene production and return the toluene back to the
gasoline pool. This toluene reentering the gasoline pool would make up for a part, or
even all, of the volume and octane of the newly extracted benzene. Thus, under either of
these scenarios, we expect only a very small or perhaps no impact on supply by increased
benzene extraction due to this benzene program.
One commenter stated that it believes that EPA failed to recognize that the public
cost of environmental programs is not the average cost across the entire industry but the
incremental cost that must be paid to acquire the final increment of gasoline supply. The
commenter further noted that even using EPA's low cost estimates, this incremental cost
is 10 times the average cost projected by the Agency modeling. We disagree with the
assertion that the cost of our environmental programs is the marginal cost of meeting the
benzene control program, which essentially reflects the cost of the most expensive
refinery to comply. Often, the price of gasoline is estimated to increase based on the
marginal cost of the highest cost producer. However, using this sort of analysis to
estimate social costs would be incorrect because it would reflect a certain amount of
transfer payment from the consumer to the oil industry. We estimate societal costs of our
rulemakings by the cost of installing and operating benzene control technologies across
the industry, not the last increment of control.
4.6 Refinery-Specific Impacts
What Commenters Said:
Flint Hills Resources noted that it operates refineries that do not have ready
access to chemical markets, which it believes essentially eliminates the choice of a
benzene extraction strategy that could provide an acceptable return on capital invested.
Sinclair Oil Corporation, Flying J. Inc., Suncor Energy (U.S.A.) Inc., and Tesoro
Corporation commented that the cost model in Table IX.A-2 projects PADD 4 and 5
refineries investing in control technology only to reach an average benzene level of about
1.0 volume percent, not the proposed 0.62 volume percent standard. The commenters
further stated that model assumes western refineries would enter 2011 out-of-compliance
with the new standard and rely on benzene credits to make up the difference. The
commenters stated that they believe that the model does not factor in a price for these
credits in the cost estimate. Thus, the commenters believe that the compliance cost
estimates for PADDs 4 and 5 are greatly understated. Lastly, the commenters noted that
they believe that the model's assumption of western refineries using benzene credits to
achieve the 0.62 standard is premised on large uncertainties; namely, that benzene credits
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would be widely available at a price more affordable than compliance. (See p. 3 of
Docket Number 0989 for table)
United Refining Company (United) commented that while any reduction in
benzene is onerous, United would face significant technical difficulties and costs in
meeting a benzene standard less than one percent by volume because, at a minimum, a
new unit would be required to convert naturally occurring benzene and benzene produced
by the fluid catalytic cracking (FCC) unit into cyclohexane (or other chemicals) with no
corresponding economic benefits.
United noted that its benzene is currently averaging 1.50 percent in regular and
3.25 percent in premium gasoline. The commenter further noted that a major source of
benzene at its refinery is reformate followed by gasoline produced at the FCC unit. The
commenter noted two strategies that it could use for benzene reduction: 1) minimize
benzene precursors going to the reformer, and 2) eliminate the benzene after it is formed.
The commenter stated that it believes that to reduce benzene in the entire gasoline pool to
levels below one percent, it would likely be forced to implement both strategies. Further,
the commenter stated, in addition to capital costs, the new unit and existing unit
modifications will increase operating costs and affect other properties of the gasoline
pool. The commenter gave the example that it would reduce the amount of hydrogen
available from the reformer unit, and this hydrogen is required to hydrotreat diesel fuel
and gasoline to comply with the various low sulfur fuel restrictions, and it would
substantially decrease the octane number in the gasoline currently produced.
Silver Eagle Refining commented that it operates two small "niche" refineries,
and that the majority of its gasoline is produced by catalytic reforming and thus the
benzene content of its finished gasoline ranges from 2.5 to 4.6 percent. The commenter
stated that it does not endorse EPA's proposed gasoline benzene standard of 0.62 percent
for technical and economic reasons. Technically, the commenter stated, a unit capable of
saturating and converting benzene into other products (such as cyclohexane) may not
provide enough reduction of benzene to meet EPA's proposed standard. The commenter
also stated that converting benzene into cyclohexane will likely reduce the octane of its
gasoline pool. Lastly, the commenter stated that replacement of the lost octane will be
difficult due to the small "niche" configuration of its two refineries.
MFC stated that refineries may not implement benzene content reduction
strategies as the proposed rule predicted, and that it does not have confidence that the
Agency has made correct compliance cost estimates for every refinery. The commenter
stated that it believes that the MSAT2 program places a very large burden on the credit
trading program, and it believes that it is unreasonable to assume that every refiner
seeking benzene content credits will always find affordable credits.
Letters:
Flint Hills Resources, LP (FHR) OAR-2005-0036-0862
Marathon Petroleum Company, LLC (MFC) OAR-2005-0036-1008
-------
Sinclair Oil Corporation, Flying J. Inc., Suncor Energy (U.S.A.) Inc., and Tesoro
Corporation OAR-2005-0036-0989
Silver Eagle Refining, Inc. OAR-2005-0036-0839
United Refining Company OAR-2005-0036-0827
Our Response:
One commenter expressed concerned that benzene extraction is not available to
them because they are not on the Gulf Coast, nor are they on the East Coast, and this
takes away a means to reduce their benzene levels that provides a return on investment.
We conservatively estimated that refiners who are not located near to the benzene
petrochemical markets would use other means to comply with the benzene program
besides benzene extraction. However, refiners outside the Gulf and East Coasts may find
it economical to transport a benzene rich stream to these regions for extraction. The
feasibility and estimated cost of benzene control is based on the use of four different
benzene control technologies that reduce benzene levels in the reformer or which reduce
the benzene levels of reformate, the product stream of the reformer. While this does
include extraction, our cost analysis projects that many refineries will use benzene
control strategies other than extraction. Thus, the estimated cost of this benzene program,
which was found to be reasonable, is based on refineries using a mix of benzene control
technologies.
Another commenter stated that they may have to reduce the benzene levels of the
naphtha produced by the fluidized catalytic cracker to reduce the benzene level of its
gasoline below 1.0 vol%. Our feasibility and cost analysis shows that all refineries could
comply with the 1.3 vol% benzene maximum average standard by using benzene
saturation, although many may be able to achieve the maximum average standard at a
lower cost using other lower cost reformer-based benzene control technologies. Once
below the maximum average standard, the refinery can use credits to comply with the
0.62 vol% average benzene standard. If the refiner did not want to rely on credits to
comply with the 0.62 average benzene standard, it could further control benzene from its
reformer by applying benzene extraction or saturation. Our feasibility analysis projects
that only eight refineries would not be able to achieve the 0.62 vol% average standard
even after applying saturation or extraction to their reformate stream. These eight
refineries would be able to reduce their gasoline benzene levels below the average
standard by reducing the benzene levels in other benzene-containing gasoline blendstocks
through distillation that would channel the benzene into their reformate benzene treating
unit. Based on some estimates of benzene control costs for these other benzene
containing gasoline blendstocks (see section 6.4.2 of Chapter 6 of the RIA), we believe
that the costs would be acceptable for refiners to reduce the benzene levels of these other
gasoline blendstocks.
Several commenters expressed concern that credits may not be available. Due to
the range in benzene control costs among refiners, and the extensive flexibility in the
program to generate trade and use credits, we have every reason to believe that refiners
will freely use the ABT program to realize its cost savings. This means that credits will
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be widely available. Furthermore, we committed ourselves to review the ability of the
credit market to provide credits just after the program begins in 2011 and we will be
monitoring the early credit market through the pre-compliance reports. If the economic
conditions are somehow different over the next several years than that estimated for our
refinery cost study (i.e., higher crude oil costs) as one commenter suggested, the ABT
program will allow refiners to alter their benzene control choices to comply with the
benzene program at the lowest cost. The benzene program is designed so that the
refining industry will achieve 0.62 vol% benzene on average at lowest cost regardless of
how feedstock prices, product prices or other conditions affecting refiners may change.
(The final rule also includes a hardship provision specific to small refiners, providing
potential relief upon a showing that the refiner could only meet the annual average
standard through purchase of credits, but that credits are unavailable for practical or
economic reasons.)
One commenter said that our cost analysis could be underestimating costs if
refiners end up generating or using credits less freely. We recognize that this is an
uncertainty in our cost modeling. Conversely, our cost analysis may be overstating costs
if some refineries, particularly large refineries, are able and choose to reduce the benzene
levels of other gasoline blendstocks, such as light straight run naphtha, light
hydrocrackate, and light coker naphtha, and by doing so generate more credits which can
be traded to other refineries which find it more cost-effective to purchase credits rather
than to reduce the gasoline benzene levels of its own refineries. Thus, our cost analysis
inherently contains some uncertainty with potentially higher or lower costs, and
potentially higher and lower regional benzene levels, than that which we have estimated.
It would be difficult to conduct any uncertainty analysis because of the very large number
of potential uncertainties that could affect the cost of compliance.
Several commenters stated that the costs for benzene control are likely to be high
for them and that EPA likely underestimated their costs because it did not factor in the
purchasing price for credits. Our cost analysis estimates the nationwide costs to comply
with the benzene program based on the projected actions taken by individual refiners to
bring the nation into compliance. The ABT program allows for benzene reductions that
can be achieved more cost-effectively by some refiners who choose to overcomply with
the average benzene standard to be transferred to other parties through the sale of credits.
Those refiners who would find it more costly to achieve the same benzene reductions can
save in their compliance costs by purchasing those credits. Thus there will be a
significant cost savings to the nation. Our cost analysis does not attempt to determine
what the costs will be for each individual company after credit trading, and even if we
had it would not be appropriate to report such results. While we did not estimate the
price of a credit due to the uncertainties involved, because the credits will be generated
principally by refiners with low costs for reducing their benzene levels, it is likely that the
price of a credit will be much lower than the benzene reduction costs for the refineries
faced with high benzene control costs and who will be the most interested in purchasing
credits.
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A couple commenters stated that reducing benzene will reduce their hydrogen
supply and reduce the octane of their gasoline pool. When we modeled the application of
the various benzene control strategies across the industry to achieve the reductions in
gasoline benzene content to estimate costs, we also modeled the cost of making up
reductions in both octane and hydrogen supply (see section 9.1.4.1 of Chapter 9 of the
RIA). Individual refiners will bear different costs. However, despite the added cost for
making up lost octane and hydrogen or making additional hydrogen available for
saturating benzene, the costs incurred were considered to be reasonable (see section A. 1
of Chapter VI of the preamble).
4.7 Averaging, Banking, and Trading (ABT) Program
We proposed a nationwide averaging, banking, and trading (ABT) program that
would allow refineries and importers to use benzene credits generated or obtained to meet
the 0.62 vol% annual average benzene standard in 2011 and beyond (2015 and beyond
for small refiners). We are finalizing a very similar program with the addition of a 1.3
vol% maximum average standard that becomes effective July 1, 2012 (July 1, 2016 for
small refiners). The 1.3 vol% standard must be met based on actual refinery benzene
levels, essentially placing a "ceiling" on credit use. While the 1.3 vol% maximum
average standard imposes a limitation on credit use, we believe that the ABT program we
are finalizing still offers much of the intended compliance flexibility, and accordingly,
that the comments presented below are still relevant.
4.7.1 Early Credit Generation
4.7.1.1 Trigger Point
We proposed a ten percent (10%) reduction trigger point for early credits to
ensure that changes in gasoline benzene levels result from real refinery process
improvements (71 FR 15875).
What Commenters Said:
We received comments supporting the proposed 10% reduction trigger point as an
appropriate mechanism for guarding against "windfall" early credit generation..
We also received comment that the early credit trigger point should not apply to
refiners whose early credit baseline is at or below the 0.62 vol% standard. The
commenter argued that this restriction penalizes companies who have provided the health
benefits of low-content benzene to the communities they serve in advance of this rule.
They believe it will be difficult for refiners who currently meet the standard to
significantly reduce benzene levels further and that they should be allowed to generate
early credits if their average benzene levels are below baseline levels without the trigger
point restriction.
Letters:
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American Lung Association OAR-2005-0036-0868, OAR-2005-0036-0365
Flint Hills Resources OAR-2005-0036-0862
Our Response:
As described in more detail in the preamble to the proposed rule (71 FR 15875),
we believe that a 10% reduction trigger point is appropriate and necessary to prevent
windfall early credit generation. We disagree that refineries already at or below 0.62
vol% benzene should be excluded from having to meet the early credit trigger point for
this very reason. We acknowledge that it could be more difficult for refineries with
already low benzene levels to make additional reductions. However, refineries with
gasoline benzene levels at or below 0.62 vol% do not have as much need for early credits
(compared to refineries above the standard) since they are less likely to need additional
lead time to comply with the standard.
4.7.1.2 Imported Gasoline
We proposed that importers would not be permitted to generate early credits for
several reasons described in more detail in the proposal (71 FR 15874).
What Commenters Said:
The Independent Fuel Terminal Operators Association (IFTOA) objected to the
EPA's rationale for excluding importers. IFTOA commented that because importers
have to meet the same benzene standard as refiners, they should be entitled to earn the
same early credits if their imports result in a net reduction in benzene emissions. They
pointed out that the importer is competing with the domestic refiner who will have the
advantage of including credits in his pricing and that the benzene rule should not place
importers at a competitive disadvantage. They also noted that importers do not simply
redistribute reduced-benzene product from one importer to another to obtain an
unwarranted benefit. According to IFTOA, importers understand the value of the
product, particularly when credits may be generated, and price their cargo accordingly.
The commenter stated that the economic incentive to move imports from one baseline to
another is offset by the premiums paid. Finally, IFTOA pointed out that the ultra-low
sulfur diesel program allows both refiners and importers to generate early credits. They
believe that the early credit provision of the diesel sulfur program is a valid precedent for
the gasoline benzene program, and that EPA should encourage importers to obtain
cleaner gasoline as soon as possible.
Letters:
Independent Fuel Terminal Operators Association (IFTOA) OAR-2005-0036-1007
Our Response:
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While raising important issues and concerns, the commenters failed to address the
Agency's overarching rationale behind excluding importers from generating early credits
under the ABT program. Given the fluid nature of many importer operations, it would be
difficult to verify that a "net reduction in benzene emissions" actually occurred in
exchange for early benzene credits.
First, it would be difficult to set a "baseline" or reference point from which to
measure early benzene reductions. Although an importer may have imported gasoline
into the U.S. during the 2004-2005 baseline period, the average benzene content of the
imported gasoline may not necessarily be representative of their usual cargo.
Likewise, a reduction in an importer's average gasoline benzene content may not
necessarily be representative of a benzene reduction made at the foreign refinery level.
Because of their variable operations, importers could potentially redistribute the
importation of foreign gasoline to generate early credits without the overall pool of
imported gasoline becoming incrementally cleaner. For example, say from January 1,
2004 to December 31, 2005 Importer A brought gasoline into the U.S. with an average
benzene content of 1.50 vol%. During the same time period, Importer B imported
gasoline that contained 1.00 vol% benzene on average. Beginning in June 2007, Importer
B could begin transferring/selling its 1.00 vol% gasoline to Importer A for importation
into the U.S. Consequently, Importer A could generate early credits based on the
difference in benzene content (1.50 - 1.00 = 0.50 vol%) divided by 100 and multiplied by
the volume of the imports (credits expressed in gallons of benzene). This would result in
"windfall" early credits being generated with no net benzene emission reduction value.
While the same gaming potential theoretically exists among refiners (although it would
be low given our knowledge of the refining industry and our prohibition against refiners
generating early credits for simply transferring gasoline/blendstocks from one refinery to
another), we believe that the importer potential is much greater based on their ability to
select which cargos they import into the U.S., their respective volumes, etc.
Finally, we only allowed importers to participate in the ULSD early credit
program because it was a fundamentally different program than the one adopted in this
rule. There was not an issue with establishing accurate sulfur baselines and/or verifying
sulfur reductions because early credit generation was simply based off of
producing/importing 15 ppm diesel fuel earlier than required. Since early credit
generation was not tied to individual refinery/importer sulfur levels or reductions but
rather to making compliant diesel fuel available sooner, importers and refineries alike
could participate in the early credit program.
In addition to the reasons mentioned above, importers do not have the same need
for early credits since they are not responsible for making investments in benzene control
technology and thus will not need additional lead time to comply with the standard.
Accordingly, we are finalizing the proposed early credit program which continues to
exclude importers from participating. However, foreign refiners with individual refinery
baselines established under § 80.910(d) who imported gasoline into the U.S. in 2004-
2005 are eligible to generate early credits.
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4.7.1.3 Blendstock Trading
In the proposal, we prohibited refiners from moving gasoline and gasoline
blendstock streams from one refinery to another in order to generate early credits because
this type of transaction would result in artificial credits with no associated emission
reduction value. If traded and used towards compliance, these artificial credits could
negatively impact the benefits of the program. We considered basing credit generation
for multi-refinery refiners on corporate benzene baselines instead of individual refinery
baselines, but determined that this could hinder credit generation. If a valid reduction
was made at one refinery and an unrelated expansion occurred at another facility during
this time, the credits earned based on a corporate baseline could be reduced to zero. As a
result, we proposed to validate early credits based on existing reporting requirements
(e.g., batch reports and pre-compliance reporting data) and sought comment on our
approach (71 FR 15875).
What Commenters Said:
We received comments that refiners typically trade blending components between
refiners to maximize production while minimizing cost. Further, that any
discouragement to these normal transactions could hinder efficient optimum gasoline
production. The commenters concluded that such companies should not be prohibited
from generating early credits.
Letters:
Caribbean Petroleum Corporation OAR-2005-0036-1010
Colonial Oil Industries OAR-2005-0036-0990
U.S. Oil & Refining Co. OAR-2005-0036-0992
Our Response:
We recognize that many refiners trade blending components between refineries to
maximize gasoline production while minimizing cost. As a result, we are not prohibiting
these types of normal refinery activities, nor are we prohibiting such refineries from
participating in the early credit program. We are simply requiring that, in order to be
eligible to generate early credits, refineries make real operational changes and/or
improvements in benzene control technology to reduce gasoline benzene levels. In most
cases, moving gasoline blendstocks from one refinery to another does not result in a net
benzene reduction (one refinery gets "cleaner" at the expense of another getting
"dirtier"). Accordingly, refineries that lower their benzene levels exclusively through
blendstock trading (no additional qualifying reductions) are not eligible to generate early
credits under the ABT program. An exception exists for refineries that transfer benzene-
rich reformate streams for processing at other refineries with qualifying post-treatment
capabilities, e.g., extraction or benzene saturation units. Under this scenario, the
transferring refinery would be eligible to generate early credits because a real operational
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change to reduce gasoline benzene levels has been made. The regulations at § 80.1275
have been modified to more clearly reflect our intended early credit eligibility provisions,
and specifically address blendstock trading.
4.7.1.7 Limiting Credit Generation to Refineries Processing Crude Oil
In § 80.1270(a)(2), we proposed that early credits could be generated only by
refiners that "produce gasoline by processing crude oil through refinery processing
units." The intent was to limit early credit generation to those entities that would
typically have to make refinery processing changes to reduce benzene levels and meet
10% early credit trigger point.
What Commenters Said:
We received several comments that the provision at § 80.1270(a)(2) limits early
credit generation and should be clarified to include refiners who process "intermediate
feedstocks" as well as crude oil through refinery processing units.
Letters:
Hess Corporation OAR-2005-0036-0769
National Petrochemical & Refiners Association (NPRA) OAR-2005-0036-0809
ExxonMobil OAR-2005-0036-0772, OAR-2005-0036-1013
Marathon Petroleum Company, LLC. OAR-2005-0036-1008
Our Response:
We agree that refineries producing gasoline from intermediate feedstocks would
also have to make process improvements to reduce gasoline benzene levels.
Furthermore, we agree that such refineries should be eligible to generate credits for
making early gasoline benzene reductions. As a result, the early credit provision at §
80.1270(a)(2) has been modified to include refineries which process intermediate
feedstocks through refinery processing units.
4.7.2 Standard Credit Generation
We proposed that standard benzene credits could be generated by any refinery or
importer that overcomplies with the 0.62 vol% gasoline benzene standard on an annual
average basis in 2011 and beyond (71 FR 15872).
What Commenters Said:
Several commenters stated that the proposed ABT program is an appropriate
phase-in mechanism for the benzene standard but that the credit trading program should
not continue indefinitely. The commenters' main concern was that without a sunset date,
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areas with elevated benzene levels would never see real reductions because refineries in
those areas would rely on credits indefinitely.
Letters:
Northeast States for Coordinated Air Use Management (NESCAUM) OAR-2005-
0036-0993,-0369
Alaska Department of Environmental Conservation (ADEC) OAR-2005-0036-
0975
Oregon Department of Environmental Quality (ODBC) OAR-2005-0036-0987
Our Response:
We are finalizing the standard credit program as proposed. As highlighted in
Preamble Section VI, the ABT program was an integral component in setting the benzene
standard. Without the ABT program (namely the ongoing standard credit program), the
0.62 vol% standard would not be feasible considering cost and other factors. Further, we
believe that the 1.3 vol% maximum average standard we are finalizing alleviates any
concerns related to prolonged elevated benzene levels as a result of the ABT program
(and is a more direct means of addressing those concerns than truncating the flexibilities
and efficiencies associated with the ABT program).
4.7.3 Early Credit Life
We proposed that early credits must be used towards compliance within three
years of the start of the program; otherwise they would expire and become invalid. In
addition, we proposed that early credits generated by and/or traded to small refiners
would have an additional two years of credit life (71 FR 15837).
What Commenters Said:
One commenter suggested that EPA should lengthen the early credit use period to
four years to encourage the generation of early credits. Another commenter
recommended a six-year early credit life and suggested that EPA discount the value of
early credits after the first three compliance years (i.e., 0.75 * value of remaining early
credits in year 4, 0.5 * value of remaining unused early credits in year 5, 0.25 * value of
remaining unused early credits in year 6, and early credits could not be used after
compliance year 6). The commenter believes that such a discounting schedule would
provide further incentives to use early MSAT2 credits in the first three compliance years
or to trade them before their value declines.
Letters:
Marathon Petroleum Company, LLC. OAR-2005-0036-1008
National Petrochemical & Refiners Association (NPRA) OAR-2005-0036-0809
Our Response:
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We are finalizing a three-year early credit life. We believe that three years is a
sufficient amount of time to trade/obtain and use early credits towards compliance. The
three-year early credit life we are finalizing is longer (and more flexible) than the early
credit life promulgated in the gasoline sulfur rulemaking (two years). Further, we do not
believe there is significant benefit to providing an even longer early credit life - beyond
three years (with or without a discounting schedule). A longer credit life would simply
increase the recordkeeping burden associated with this rule and prolong implementation
of the 0.62 vol% standard.
In addition, we are not finalizing the two-year credit life extension proposed for
early credits generated by and/or traded to small refiners. By staggering early credit
usage periods (non-small refiners may use early credits from 2011-2013, small refiners
may use early credits form 2015-2013), no early credits may be used towards compliance
with the 2014 year. We believe that this break in early credit usage will be a valuable
mechanism for funneling surplus early credits facing expiration to small refiners in need.
Therefore, providing an additional credit life extension for early credits traded to small
refiners is unnecessary.
4.7.4 Standard Credit Life
We proposed that standard credits must be used within five years from the year
they were generated (regardless of when/if they are traded). To increase the certainty that
standard credits would be available to small refiners, we proposed that standard credits
generated by and/or traded to small refiners would have an additional two years of credit
life (71 FR 15873).
What Commenters Said:
We received many comments supporting the proposed five-year standard credit
life provision.
Letters:
Caribbean Petroleum Corporation OAR-2005-0036-1010
Colonial Oil Industries OAR-2005-0036-0990
Gladieux Trading & Marketing Co., LP OAR-2005-0036-0972
Marathon Petroleum Company, LLC. OAR-2005-0036-1008
National Petrochemical & Refiners Association (NPRA) OAR-2005-0036-0809
U.S. Oil & Refining Co. OAR-2005-0036-0992
Our Response:
Since we did not receive any adverse comments and continue to believe that a
five-year standard credit life strikes a balance between program flexibility and
enforceability, we are finalizing the proposed five-year standard credit-life provision.
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We are also finalizing the two-year standard credit life extension for small refiners.
However, we are revising the proposed provision such that, in order to be eligible for the
two-year credit life extension, standard credits must be "traded to and ultimately used by"
small refiners. We excluded credits generated by small refiners because refiners
generating and using their own standard credits do not need additional credit life to
increase the certainty that credits would be available. In addition, we added the provision
that standard credits must be ultimately used by small refiners to obtain the two-year
credit life extension. Credits traded to a small refiner then traded again to a non-small
refiner are ineligible for the credit life extension because this would not increase the
certainty that credits would be available to small refiners.
4.7.4.1 Credit Life Extension for Small Refiners
To encourage credit trading to small refiners, we proposed that credit life could be
extended by two years for early credits and/or standard credits generated by or traded to
approved small refiners (71 FR 15873).
What Commenters Said:
We received comment that the ABT program should provide for extended life of
credits generated by small refiners or sold to small refiners. The commenter
subsequently goes on to recommend unlimited credit life for credits used by small
refiners (addressed below in S&A Section 4.7.5).
Letters:
Countrymark Cooperative, LLP OAR-2005-0036-0471
Our Response:
We are finalizing a modified version of the proposed two-year credit life
extension for credits generated by or traded to small refiners. As discussed above in
Sections 4.7.3 and 4.7.4, to be consistent with the intent of the provision we have
clarified that the two-year credit life extension only applies to standard credits traded to
and ultimately used by small refiners.
4.7.4.2 Conflict with 5-Year Statute of Limitations
Under the proposed program, standard credits would have a seven-year life if
generated by or traded to small refiners. In the proposal, EPA expressed concern that
extending credit life beyond the five-year statute of limitations in the Clean Air Act could
create significant enforceability problems. Consequently, we sought comment on
provisions that could be included in the regulations to address the enforceability concerns
surrounding the extended credit life for small refiner standard credits (71 FR 15873).
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What Commenters Said:
The Ad Hoc Coalition of Small Refiners commented that enforceability issues
could be addressed in spite of the statute of limitations with a relatively simple approach.
They suggested that EPA suspend the right to participate in the credit program to any
small refiner that abuses the system. Suspensions could be for a definite time period for
first or second violations working up to indefinite suspension if the transgressions are
repeated. The Ad Hoc Coalition of Small Refiners concludes that such an approach
would address the problem and only punish the wrong-doer(s), if any.
Letters:
Ad Hoc Coalition of Small Refiners OAR-2005-0036-0686
Our Response:
We are finalizing a five-year standard credit life plus a two-year credit life
extension for standard credits traded to and ultimately used by small refiners. This could
result in a total seven-year standard credit life in certain situations, which could
potentially conflict with the five-year statute of limitations. However, EPA need not wait
seven years to bring an enforcement action. Enforcement concerns can be mitigated by
proactive procedures including: reviewing and processing compliance reports in a timely
fashion and understanding which refineries' average benzene levels are above and below
the 0.62 vol% standard and thus, which have the potential to be credit users and
generators. By investigating questionable credit activities as soon as possible we believe
we will be able to take any necessary enforcement action within the five-year statute of
limitations period.
4.7.5 Consideration of Unlimited Credit Life
As discussed above, we proposed finite credit life for both early and standard
credits. However, in the proposal we acknowledged that there could be some benefits
associated with unlimited credit life. Specifically, that unlimited credit life could
potentially enhance credit generation and also allow refiners to maintain an ongoing
supply of credits in the event of an emergency. However, we also emphasized that
unlimited credit life could pose serious enforcement issues. Accordingly, we sought
comment on how unlimited credit life could be beneficial to the program and how
associated recordkeeping and enforcement issues could be mitigated. We also sought
comment on different ways to structure the program (e.g., EPA managing the credit
market) that would allow for unlimited credit life (71 FR 15873).
What Commenters Said:
We received several comments supporting the Agency's proposal not to manage
credit trading but rather to allow trading with minimal restrictions. However, we also
received a comment supporting unlimited credit life. The commenter highlighted that
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credit generation is an environmental plus and credit use is an environmental negative.
The commenter added that unlimited credit life would likely promote credit generation
and discourage excessive use in response to credits facing expiration. The commenter
believes that credits with unlimited life would likely be stored and used only when the
economic value of their use exceeds their market value. The commenter concluded that
all credits should have indefinite life in order to maximize their economic value. Another
commenter added that credits generated by or traded to small refiners should have
unlimited life.
Letters:
Marathon Petroleum Company, LLC. OAR-2005-0036-1008
National Petrochemicals & Refiners Association (NPRA) OAR-2005-0036-0809
Ad Hoc Coalition of Small Refiners OAR-2005-0036-0686
Countrymark Cooperative, LLP OAR-2005-0036-0471
Our Response:
While we acknowledge that there could be some benefits associated with
unlimited credit life, we believe that they are outweighed by the potential negatives.
First, although unlimited credit life could allow refiners and importers to maintain an
ongoing supply of credits in the event of an emergency, it could also encourage hoarding
of credits. And if credits were not traded, this would force refineries with more
expensive control technologies (who would otherwise rely on credits) to comply with the
annual average standard through technological means likely increasing the overall cost of
the program. Second, if credits could be used for an indefinite amount of time, credit
records would have to be maintained indefinitely - posing a recordkeeping burden.
Third, allowing unlimited credit life could make it difficult for EPA to verify compliance
with the standard. Even if credit records were maintained indefinitely, the fluid nature of
the refining industry could result in enforcement difficulties. For example, if a refiner
used credits that were severely dated towards compliance (permissible under a program
with unlimited credit life), EPA could experience difficulties tracking down the generator
to verify that the credits were indeed properly generated. During the extended
intervening period, the generator could have gone out of business or company ownership
could have changed several times making it difficult to find or follow a paper trail. For
all these reasons, we believe that the disadvantages of unlimited credit life outweigh the
potential benefits and thus are finalizing finite credit life for both early and standard
credits (including credits generated/used by small refiners).
4.7.6 Credit Trading Provisions
4.7.6.1 Nationwide Trading Allowance
We proposed a nationwide ABT program that would allow refineries and
importers to use benzene credits generated or obtained under the ABT program to meet
the 0.62 vol% annual average benzene standard in 2011 and beyond (71 FR 15872).
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What Commenters Said:
We received a number of comments supporting the proposed ABT program
containing no geographic restrictions on credit trading. The commenters believe that the
proposed nationwide ABT program will provide maximum flexibility and cost
effectiveness, as well as minimize any adverse supply impacts.
Letters:
American Petroleum Institute (API) OAR-2005-0036-0366, OAR-2005-0036-0367
Marathon Petroleum Company, LLC. OAR-2005-0036-1008
National Petroleum & Refiners Association (NPRA) OAR-2005-0036-0809
BP Products North American Inc. OAR-2005-0036-0824, OAR-2005-0036-0837
ExxonMobil OAR-2005-0036-0772, OAR-2005-0036-1013
Flint Hills Resources OAR-2005-0036-0862
Our Response:
As proposed, we are finalizing a nationwide ABT program that does not impose
any geographic restrictions on credit trading. Credits may be traded nationwide between
refiners or importers as well as within companies to meet the 0.62 vol% national average
benzene standard. Early and standard benzene credits may also be used interchangeably
towards compliance as permitted by their respective credit life provisions. We believe
that restricting credit trading could reduce refiners' incentive to generate credits and
hinder trading essential to this program. In addition, as highlighted in Preamble Section
VI, the nationwide aspect of the ABT program was an integral component in setting the
benzene standard. Without such a program, the 0.62 vol% standard would not be feasible
considering cost and other factors.
4.7.6.2 Number of Trades
We proposed that credits must be transferred directly from the refiner or importer
generating them to the party that intends to use them for compliance purposes. This
ensures that the parties purchasing them are better able to assess the likelihood that the
credits are valid. An exception exists where a credit generator transfers credits to a
refiner or importer who inadvertently cannot use all the credits. In this case, the credits
can be transferred a second time to another refiner or importer. After the second trade,
the credits must be used or terminated. In the proposal, we requested comment on
whether more than two trades should be allowed - specifically, whether three or four
trades were more appropriate and/or more beneficial to the program (71 FR 15876).
What Commenters Said:
We received comments supporting a maximum number of two trades as well as
comments suggesting the ability to trade credits up to four times before credits would
have to be terminated.
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Letters:
Caribbean Petroleum Corporation OAR-2005-0036-1010
Colonial Oil Industries OAR-2005-0036-0990
Gladieux Trading & Marketing Co., LP OAR-2005-0036-0972
U.S. Oil & Refining Co. OAR-2005-0036-0992
American Lung Association OAR-2005-0036-0868, OAR-2005-0036-0365
Our Response:
The commenters suggesting four trades did not provide any rationale supporting
the need for an additional number of trades. They did not address how the additional
flexibility would be beneficial to the program nor did they address how the added
flexibility would outweigh the enforcement concerns. As a result, we are finalizing a
maximum number of two trades. Not only is this provision consistent with other fuel
rulemakings, we believe it strikes a balance between flexibility and enforceability.
Allowing more than one trade provides for a "safety valve" in the event that credits
obtained cannot be used within the credit life provisions. Allowing the fewest number of
trades ensures that both credit purchasers and EPA are better able to assess the validity of
credits.
4.7.6.3 Credit Brokering/Ownership
We proposed no prohibitions against brokers facilitating the transfer of credits
from one party to another. Any person can act as a credit broker, regardless of whether
such person is a refiner or importer, although no credit "ownership" transfers to the
broker. This prohibition on outside parties taking ownership of credits was promulgated
in response to problems encountered during the unleaded gasoline program and has since
appeared in subsequent fuels rulemakings. To reevaluate potential stakeholder interest in
removing this prohibition, EPA sought comment on this provision in the proposal —
specifically, whether there were potential benefits to allowing other parties to take
ownership of credits and how such a program would be enforced (71 FR 15876).
What Commenters Said:
We received comments from several companies all supporting the prohibition
against brokers taking ownership of credits.
Letters:
Caribbean Petroleum Corporation OAR-2005-0036-1010
Colonial Oil Industries OAR-2005-0036-0990
Gladieux Trading & Marketing Co., LP OAR-2005-0036-0972
U.S. Oil & Refining Co. OAR-2005-0036-0992
Our Response:
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Since we did not receive any adverse comments, we continue to believe that our
existing prohibition on outside parties taking ownership of credits is appropriate. As
such, we are finalizing the proposed program where brokers can facilitate credit transfers
but not take "ownership" of credits. Not only is this provision consistent with other ABT
programs for mobile sources and their fuels, it is sufficiently flexible while preserving
adequate means for enforcement.
4.7.7 Exclusion of California Gasoline from ABT Program
Despite the fact that California gasoline is not covered by this program, EPA
sought comment on whether and how credits could be generated based on California
gasoline benzene reductions and applied toward non-California gasoline compliance (71
FR 15873).
What Commenters Said:
One commenter agreed with our proposal and opposed credits being generated on
behalf of California gasoline benzene reductions for use outside of California. Another
commenter responded that California refineries should be allowed to participate in the
ABT program. .
Letters:
Marathon Petroleum Company, LLC. OAR-2005-0036-1008
American Lung Association OAR-2005-0036-0868, OAR-2005-0036-0365
Our Response:
The commenter supporting the inclusion of California refineries did not provide
any rationale why California gasoline specifically should be included in the ABT
program. As a result, we are finalizing the proposed program which excludes California
gasoline. As described below, we believe that including California gasoline in the ABT
program would be a rigorous task with very few benefits.
First, we do not currently receive batch reports for California gasoline under the
existing RFG/Anti-Dumping reporting requirements. Therefore, in order for credits to be
generated (based on baseline benzene reductions) California gasoline refineries would
first need to provide EPA with the appropriate 2004-2005 batch reports in order to
establish individual refinery benzene baselines. Additionally, these refineries would need
to provide EPA with such reports in the future (in addition to the CARB compliance
reports/information required under the California Phase 3 Reformulated Gasoline
(CaRFG3) Program). On the other hand, if we allowed credits to be generated for
overcomplying with the 0.62 vol% standard (as opposed to making reductions from an
individual benzene baseline), this would mostly likely result in windfall credit generation.
As of 2004, California gasoline benzene levels were already around 0.62 vol% on
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average (based on data provided to EPA by CARB). As a result, contrary to the intent of
the program, most California gasoline refineries would be eligible to generate credits for
doing nothing at all. For these reasons, we are finalizing the proposed ABT provision
which excludes California gasoline from generating credits.
4.8 Effects on Fuel and/or Energy Supply, Distribution, and Use
4.8.1 Energy Impacts
What Commenters Said:
The American Petroleum Institute (API) commented that Draft RIA Table 9.610
characterizes estimated changes in energy use resulting from the (proposed) rule as small,
but the commenter noted that the change is positive—i.e., more energy is needed to
accomplish the same fuel delivery.
ExxonMobil, NPRA, and MFC commented that they believe that proposed
MSAT2 standards are a significant energy action, and that EPA has incorrectly stated that
the rule is not a "significant energy action" (per EO 123211). They further stated that
they do not agree with EPA's belief that the reduced volume (about 23,500 b/d) of
reformate available for gasoline production due to MSAT2 will be made up through other
processes with little or no net reduction in gasoline production. The commenters stated
that they do not accept the assumption that this volume reduction can be replaced easily.
NPRA and Marathon Petroleum Company also commented that EPA projected
that the annual aggregate costs associated with the rule will be $185.5 million in 2011
(and higher after 2011); based on these cost projections, the commenter stated that it
believes the program is a significant energy action because is exceeds $100 million (per
section 3(f) of E.G. 12866).
Letters:
American Petroleum Institute (API) OAR-2005-0036-0884
ExxonMobil Refining & Supply Company OAR-2005-0036-0772
Marathon Petroleum Company LLC OAR-2005-0036-1008
National Petrochemical & Refiners Association (NPRA) OAR-2005-0036-0809
Our Response:
Several commenters expressed their view that the benzene control program will
have a major adverse impact on energy supply. In its guidance document to Executive
Order numbered 13211, the Office of Management and Budget (OMB) defined specific
criteria for determining whether any rulemaking has a significant adverse effect on
energy supply, distribution and use. We identified three significant adverse impact
criteria contained in the OMB guidance document which could be relevant. The first
criteria relates to electricity demand. OMB's guidance document to EO 13211 states that
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a regulatory action has caused a significant adverse effect on energy if the supply of
electricity is reduced by a billion kilowatt hours per year. As estimated by our contractor
using its linear programming refinery model (which estimate we have analyzed and agree
with), the benzene reductions required by the final rule should result in less than 290
million kilowatt-hours per year of additional electricity demand.22 This demand would
result from the application of benzene control equipment and other refinery changes
associated with gasoline benzene control. This additional demand for electricity is below
the trigger of 1 billion kilowatt-hours per year of electricity identified in the OMB
guidance document that would be considered a significant impact on electricity supply.
OMB's guidance document to EO 13211 also states that a regulatory action has
caused a significant adverse effect on energy if natural gas supply is impacted by 25
million standard cubic feet per year, which equates to about 25 billion BTUs per year.
Based on the linear program modeling work cited above, our final benzene control
program is expected to cause an additional demand of 5.5 billion BTUs per year of
natural gas, which is lower than the trigger of 25 billion BTUs per year that would define
a significant impact on natural gas supply.
Based on OMB's guidance document, the last potential trigger for how this
rulemaking could cause a significant adverse effect on energy supply, distribution and
use relates to decreases in fuel supply. Several commenters raised this as an issue related
to EO 13211, while others raised it as a more general issue. OMB's guidance document
to EO 13211 states that a regulatory action has caused a significant adverse effect on
energy if the supply of fuel is decreased by 4,000 barrels per day. In this case we
interpret the term fuel to mean gasoline.
Compliance with the benzene standards in the rule will not automatically reduce
gasoline supply. Refineries which are able to meet the standards through benzene
saturation, for example, will not incur any volumetric reductions in gasoline production.
Gasoline production would be decreased only at refineries utilizing benzene extraction
(i.e. reformate extraction), since removing benzene from the gasoline pool via extraction
reduces the overall volume of gasoline. We in fact project that refineries will extract an
additional 12,500 barrels of benzene per day, or 192 million gallons per year, in the
course of complying with the fully phased-in benzene control program.23 This is
equivalent to about 13,375 barrels per day of gasoline (or about 0.1 percent of U.S.
gasoline production) when the higher energy density of benzene is taken into account.
At first blush, this appears to exceed the significant adverse effect threshold.
However, we believe that the net effect of the rule on gasoline supply will be far less,
potentially zero, and will not exceed the 4000 barrels of fuel supply threshold. This is
because we expect the increase in extraction of benzene from gasoline to occur with or
22 Kolb, Jeff, Abt Associates, Estimated Changes in Energy Use, LP Refinery Model Output provided to
EPA under contract WA 0-01, EP-C-06-094, December 27, 2006.
23 Kolb, Jeff, Abt Associates, Estimated Changes in Energy Use, LP Refinery Model Output provided to
EPA under contract WA 0-01, EP-C-06-094, December 27, 2006.
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without the final benzene control program. Using Chemical Market Associates
Incorporated's (CMAI) estimate of a 2.4 percent annual growth in benzene demand, we
expect that U.S. demand for benzene will increase by 600 million gallons from 2007 to
2015, the years that the final benzene control program is expected to phase-in. Assuming
as is reasonable that reformate extraction continues to supply about 40 percent of the total
benzene supply,24 then reformate extraction is expected to supply about 250 million
gallons additional benzene over the eight year benzene program phase-in period. This
exceeds the amount of reformate extraction that we project would occur for refiners using
benzene extraction to comply with the gasoline benzene standards in this rule, provided,
as is reasonable, that the benzene extraction occurs throughout the entire phase-in period.
Only in the highly unlikely event that all refiners projected to use benzene extraction to
comply with the final benzene control program install extraction equipment in a single
year would the increased benzene supply exceed projected benzene demand (by a factor
of roughly two times the yearly increase in total benzene demand), potentially raising
issues of reduction in gasoline supply under the Executive Order.25
Even under this unlikely scenario of all the projected benzene extraction
occurring in a single year, the benzene market would likely adjust to rebalance both the
benzene market and the gasoline supply. Selective toluene disproportionation and
toluene hydrodealkylation are higher cost benzene production technologies that
contributed about 290 million gallons per year of benzene to the U.S. petrochemical
market in the year 2002. If there were to be a drastically increased volume of benzene
extraction from refineries, there would likely be correspondingly less use of these two
marginal, higher cost benzene production processes which would rebalance the benzene
supply/demand market. Assuming (reasonably) that these two benzene production
processes temporally reduce their output to rebalance benzene supply, the feedstock
toluene would presumably stay in the gasoline pool essentially negating the potential
impact that reducing benzene from gasoline supply would otherwise cause. We therefore
do not see gasoline volumes being significantly reduced as a result of benzene extraction
occurring as a result of requirements of this rule.26
We thus do not accept the comments that this rule would have a significant
adverse impact on energy supply, distribution, or use for purposes of the Executive
24 This is a reasonable assumption because the contribution of reformate extraction to the total supply of
benzene in North America has remained fairly constant from 1998 to 2002, the years that CMAI provides
benzene supply data in their Benzene report.
25 Increased benzene extraction for compliance as modeled by the cost analysis is likely to phase in over the
entire phase in period of the benzene program because of the implementation nature of the various benzene
extraction projects. Of the total 16 extraction units expected to be revamped or newly installed by refiners
complying with the benzene program, 13 of them are revamps. Because revamp projects are extremely
variable in nature with a similar variation in cost, they can be completed over a time period which ranges
from almost immediately to 4 or even 5 more years our for more complex revamps. The 3 grassroots
extraction units will likely be installed the latest of all the benzene extraction projects because they require
extensive installs, both for onsite and offsite capital. Thus these projected benzene extraction units will be
installed throughout the phase-in period.
26 We conservatively did not reduce our program cost estimates due to any of the modeled benzene
extraction occurring in the baseline, nor did we reduce our cost estimate based on any toluene reentering
the gasoline pool from reduced benzene formation from toluene feedstocks.
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Order, or for purposes of our consideration of energy issues required by section 202 (1)
(2) of the Act. In this regard, we note further that we do not believe that there will be any
reduction (and there may be an increase) in fuel supply from the rule's vehicle standards,
and that the standards for portable fuel containers will result in significant fuel savings by
reducing evaporative losses (estimated to be about 66 million gallons of gasoline savings
per year in 2014).
One commenter stated that this rulemaking has a significant impact on gasoline
supply because it exceeds $100 million per year cost threshold of EO 12866. However,
EO 12866 sets a trigger which determines whether a rulemaking has a significant
economic impact, but that does not also indicate that a rulemaking has a significant
impact on energy supply. For that analysis, we rely on the criteria for EO 13211, as just
discussed above.
4.8.2 Impacts on Gasoline Supply
What Commenters Said:
The New York Department of Environmental Conservation commented that it
believes that a reduction in gasoline benzene is good, but raises the question of how the
lost volume will be made up and whether the volume of other undesirable constituents
will increase.
At the public hearing, the National Petrochemical and Refiners Association
(NPRA) also commented that, in proposing new standards for fuel formulations or any
other rules affecting refinery and/or petrochemical facilities, the Agency needs to be
aware of the total impact these programs may have on fuel supply.
NPRA and Marathon Petroleum Company (MFC) commented that they believe
that the Agency should re-evaluate the rule's potential impacts on gasoline supply. The
commenters further stated that they do not agree with the Agency's optimistic projections
that the net effect of the MSAT2 program on gasoline supplies will be potentially zero.
They stated that they also do not agree with the statements that the proposed ABT
program with the 0.62 vol% benzene level is feasible, would be met without extreme
economic consequences, and that all refineries would be able to comply. The
commenters noted that, in response to the benzene standards, they believe that refineries
could choose to close, reduce gasoline production, or export more gasoline, all of which
could adversely affect gasoline supplies. The commenters further stated that they believe
that fmalization of the rule as proposed could result in lower gasoline imports if importers
do not wish to incur the additional expense of purchasing credits from domestic
refineries.
The commenters also stated that they believe that gasoline supplies will also be
adversely affected if the rule results in reduced gasoline imports. The commenters noted
that the lower benzene level may limit gasoline imports into the U.S. from areas that do
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not have gasoline benzene controls, such as Central and South America and the
Caribbean. The commenters suggested that EPA consider whether such import
restrictions will have an adverse impact on US gasoline markets.
NPRA and Marathon Petroleum Company also commented that they believe that
the rule would have an adverse effect on domestic gasoline supplies if refineries closed,
reduced gasoline production, and/or exported more gasoline. The commenter further
stated that refineries may not implement benzene content reduction strategies as the
proposed rule predicted, and that it does not have confidence that the Agency has
estimated correctly for every refinery.
Letters:
Marathon Petroleum Company LLC OAR-2005-0036-1008
National Petrochemical & Refiners Association (NPRA) OAR-2005-0036-0809
New York State Department of Environmental Conservation OAR-2005-0036-
0722
Our Response:
The commenters expressed their concern that the new benzene program could
create a regulatory hurdle that will result in less gasoline being imported into the U.S.
After reviewing the benzene levels of imported gasoline and considering the flexibility of
our benzene program, we don't think that imported gasoline volumes will be affected
significantly. About half of imported gasoline is imported into the RFG market which
already requires lower benzene levels. A review of the benzene levels of imported
gasoline reveals that it averages 0.75 vol% benzene, which is substantially lower than the
roughly 1.0 vol% current national average benzene level for U.S. gasoline. Even
assuming that foreign refiners will not be willing to further reduce their gasoline benzene
levels, if their gasoline benzene levels are above 0.62 vol% benzene, they could continue
to import gasoline that exceeds the 0.62 vol% benzene standard and purchase credits.
Only 0.5% of imported gasoline's volume exceeds the 1.3 maximum average benzene
standard and is at risk of being rejected from the U.S. gasoline market. Even this higher
benzene gasoline could continue to be brought into the U.S. if the importers balance this
higher benzene gasoline with gasoline which contains less than 1.3 vol% benzene
resulting in a combined gasoline pool which averages less than 1.3 vol% benzene.
Two commenters stated that gasoline supply could be impacted adversely if some
refiners closed as a result of the benzene program. Based on the flexibilities provided by
the benzene program, we do not project any closures in our detailed economic analysis
found in chapter 9 of the RIA. The ABT program provides several flexibilities, such as
the availability of credits or deficit carry-forward, which will help to reduce the cost of
compliance with the annual average gasoline benzene standard. For smaller refineries
that our modeling estimates would be faced with potentially high costs to comply with
the 1.3 maximum average standard, we believe that there are other lower cost means for
these refineries to reduce their benzene levels which are not captured by our refinery cost
modeling (see section 9.6.1 of Chapter 9 of the RIA). Finally, the final rule provides
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numerous exemption opportunities for refiners that can demonstrate that the rule causes
them extreme hardship that leaves refineries many alternatives to closure.
Finally, one commenter asked whether the decrease in gasoline benzene content
will cause the content of other undesirable constituents in gasoline to increase. We do
not project this to be the case. Some of the benzene control technologies (notably
benzene saturation) chemically convert the benzene to cyclohexane, a petroleum
compound not known to be a human carcinogen. Most of the benzene reducing
technologies will cause a small decrease in the octane level of the treated gasoline. This
octane loss will likely be made up by the addition of ethanol, since ethanol has become
the constituent of choice for increasing the octane of the gasoline pool. See section
VIA. l.b.i of the preamble to the final rule.
4.8.3 Other
What Commenters Said:
Sinclair Oil Corporation, Flying J. Inc., Suncor Energy (U.S.A.) Inc., and Tesoro
Corporation commented that they believe that a further economic disadvantage PADD 4
and 5 refineries face with benzene control is the distance from, and lack of access to,
benzene markets. The commenters stated that they believe this may be one reason why
many Gulf Coast refineries manufacture gasoline with benzene levels lower than the
nation at large; and conversely, PADD 4 and 5 refineries that rail benzene to
petrochemical plants in the Gulf Coast region pay a high transportation penalty to sell
benzene to these facilities.
MFC commented that it believes that, due to the wide range of starting points,
compliance costs will be low for some refineries and higher for others. The commenter
stated that it believes that the variability in the selection of benzene control strategies (as
predicted in the proposed rule's refinery cost model) depends on existing equipment at
the refinery, proximity to the petrochemical market, and estimated benzene reduction
technology costs compared to the cost of buying a credit. However, the commenter
noted, it was assumed in the proposal that all refineries will choose to either make the
necessary investments or will purchase credits—the commenter stated that it believes that
EPA made no attempt to identify these refineries or their cumulative volume impact on
the US gasoline pool.
ExxonMobil commented that it believes that EPA should estimate the potential
adverse impact the proposal will have on criteria pollutants and CO2 emissions at
refineries.
Letters:
ExxonMobil Refining & Supply Company OAR-2005-0036-0772
Marathon Petroleum Company LLC OAR-2005-0036-1008
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Sinclair Oil Corporation, Flying J. Inc., Suncor Energy (U.S.A.) Inc., and Tesoro
Corporation OAR-2005-0036-0989
Our Response:
Several commenters commented about the cost of compliance for refineries in
PADDs 4 and 5, particularly about the economic inability to use benzene extraction as a
benzene control technology. We agree that the refiners in PADDs 4 and 5 are unlikely to
have the ability to use extraction to reduce benzene levels at their refineries due to lack of
access to benzene markets without disproportionate transport costs. Our modeling is in
fact consistent with this belief. Also these refineries tend to have higher starting benzene
levels and poorer economies in scale (they are smaller refineries) resulting in higher
compliance costs for the refineries in these PADDs. For this reason, our modeling
projects that several refineries in PADDs 4 and 5 will rely on the ABT program to
purchase credits, reducing their overall cost of complying with the annual average
benzene standard.
One commenter stated that there is a wide range in compliance strategies as well
as compliance costs, as identified in the regulatory documents. However, the commenter
stated that we did not identify which refineries will take what benzene control steps, nor
did we attempt to identify the impact on gasoline supply. Addressing the first comment,
our refinery-by-refinery analysis is built in part upon confidential business information,
and our projections of the steps they might take to reduce their benzene levels are
considered sensitive information. Therefore, we cannot reveal our refinery-by-refinery
projections of which refineries take what steps to reduce their benzene levels, although
we did report the projected use of benzene control technologies more generally. As for
the second comment, as described above in our response to comment 4.8.1, we do not
believe that there will be a net impact on gasoline supply due to benzene extraction used
by U.S. refiners when complying with this rulemaking. We further concluded in our
response to comment 4.8.2 that imports are not expected to decrease due to the rule's
requirements. In sum, we don't expect any significant decrease in gasoline supply caused
by fuel (or other) requirements of the rule.
One commenter stated that EPA should estimate the emissions increases in CO2
and criteria pollutants at refineries caused by the benzene program. The analysis
conducted by our contractor to estimate the energy and supply impacts of the benzene
program provided detailed estimates of the fuel and electricity consumed at refineries in
reducing the benzene levels of gasoline.27 We used these fuel and electricity demand
estimates along with emission factors for carbon dioxide and criteria pollutants to derive
emission estimates for carbon dioxide and criteria pollutants at refineries.
The national increase in fuel demand, which is assumed to be natural gas,
associated with application of benzene control technologies is 16 trillion BTUs per year
which includes the natural gas used in furnaces and steam generation. Of that 16 trillion,
27 Kolb, Jeff, Abt Associates, Estimated Changes in Energy Use, LP Refinery Model Output provided to
EPA under contract WA 0-01, EP-C-06-094, December 27, 2006.
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9.8 trillion BTUs per year comprises feedstocks for the production of hydrogen (the
relevance of which is discussed below). Additional energy demand and emissions occur
through the consumption of electricity. Electricity demand is estimated to increase by
731 kilowatt-hours. Electricity is equivalent to 3400 BTUs per kilowatt-hour and
electricity generation is estimated to be about 37 percent efficient. Thus, electricity
generation is responsible for about 0.06 trillion BTUs per year of additional energy
consumption.
To estimate the emissions of carbon dioxide and criteria pollutants at refineries
we used emission factors for deriving the emissions from the increased demand for
natural gas and electricity. The emission factors that we used are the criteria emission
factors for a gasoline hydrotreater provided to us by Mobil Oil.28 Since the natural gas
used for hydrogen production was consumed as a feedstock and not burned, we did not
use that part of the natural gas consumption to derive criteria emission estimates,
although we did consider it along with the rest of the natural gas and electricity
consumption for carbon dioxide emissions.
The emission factors for the use of energy are summarized in the Table below.
The NOx emission factor is expressed as a range. The lower value reflects the emissions
from the use of ultra-low NOx burners, while the upper number reflects the emissions of
conventional burners. The rest of the criteria emissions are estimated based on single
point estimates for their emission factors. The emission factor for carbon dioxide is
estimated from the combustion of an equal blend of natural gas and liquid petroleum gas,
which represents the combustion of refinery gas. The combustion of this blend in
refinery fuel is estimated to yield 143,000 Ibs of CO2 per billion BTU of fuel consumed.
We assume that electricity has the same emission factors as refinery fuel gas, which is
very simplistic. Electricity can be generated from coal, fuel oil, natural gas, nuclear,
hydroelectric and other renewable energy sources. All these energy sources can
contribute to higher and lower emission levels of pollutants than that assumed based on
refinery fuel gas, so using the criteria pollutant emission factors of refinery fuel gas may
be roughly representative as well. The small amount of total energy consumed from the
generation of electricity means that the uncertainty around the emissions associated from
electricity production will have little impact on the emissions estimates.
Summary of Emission Factors and Refinery
Emissions Attributed to the Benzene Program
C02
NOx
VOC
CO
Emission Factors
(Ibs per Billion BTU)
143,000
35-140
25
35
Change in 20 12
Emissions
(tons/yr)
1,145,000
108-433
77
108
28 While units which reduce gasoline benzene levels are different from those that desulfurize gasoline, the
primary units that use energy, including furnaces and boilers, are very similar. Thus, the emission factors
derived for gasoline desulfurization units can be applied to benzene reducing technologies.
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Particulate
SOx
3.0
13
9
40
The table shows that CC>2 emissions at refineries are estimated to increase by a
little more than a million tons per year, and the refinery criteria emissions are estimated
to increase within a range of 9 to 430 tons per year.
4.9 Small Refiner and Other Hardship Provisions
4.9.1 Small Refiner Provisions
4.9.1.1 Support for Small Refiner Provisions
What Commenters Said:
We received several comments supporting provisions for small refiners in the
MS AT2 rule, especially the four-year period of additional lead-time. The commenters
noted that they believe that this provision is very important because small refiners
generally lack the resources available to large companies and require additional time to
acquire capital and complete equipment modifications.
The Ad Hoc Coalition of Small Business Refiners (Small Refiners) further
commented that they agree with EPA's rationale for providing small refiner provisions
and stated that they believe EPA expressed well the special needs of small refiners.
Some commenters suggested that EPA allow less stringent or alternate standards
indefinitely for small refiners. One commenter stated that it believes the cost to meet the
proposed 0.62 vol% benzene standard will be inordinate, and that a loss of marketable
gasoline due to benzene reduction would cause it to incur significant economic hardship.
The commenter suggested that provisions such as delayed compliance, and those that will
either allow small refiners to meet alternate benzene standards or contain a credit
program that will make compliance economically possible, should be part of the final
rule. Another commenter stated that small refiners are still concerned about the impact of
this regulation on their long term viability; and that while the amount of gasoline that
small refiners produce is not large, it is critical both to supply and price. The commenter
thus stated that it believes this warrants a relaxing of the benzene requirements for small
refiners (an action it believes would not impact the MSAT2 program), and further
requested that EPA reevaluate whether a 0.62% benzene level for small refiners actually
makes sense, considering that small refiners are located all over the United States and the
amount of small-refmer-produced gasoline consumed in any given area is minimal.
In addition, Countrymark commented that it believes that the regulation should
contain a provision for individual hardship relief for small refiners on a long-term basis if
they are unable to reduce the benzene level required by the regulations. The commenter
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noted that it is possible that a small refiner could install benzene removal equipment and
still need to purchase credits; that the purchase of credits would be so costly that it could
not compete in the gasoline market; or that a small refiner still could not comply even if it
was financially able to install the removal equipment. Countrymark commented that, in
either case, it believes such a refiner should be allowed to continue to operate at a higher
benzene level until it is possible for it to obtain equipment that would be effective or the
credit costs reduced. The commenter suggested that in such cases of hardship, EPA
should consider whatever action is necessary to allow the small refiner to continue to
produce gasoline. The commenter further stated that it believes it is important for EPA to
recognize the need to keep every small refiner a viable producer of gasoline for the
market.
Letters:
Ad Hoc Coalition of Small Business Refiners OAR-2005-0036-0686
Caribbean Petroleum Corporation OAR-2005-0036-1010
Countrymark Cooperative, LLP OAR-2005-0036-0471
Silver Eagle Refining, Inc. OAR-2005-0036-0839
U.S. Oil & Refining Company OAR-2005-0036-0992
Our Response:
As stated in the preamble to the final rule, we are finalizing many of the
provisions that were proposed which were specific to small refiners. We believe that
small refiners generally have greater difficulty than larger companies (including those
large companies that own small-capacity refineries) in raising capital for investing in
benzene control equipment. We also believe that small refiners are likely to have more
difficulty in competing for engineering resources and completing construction of the
needed benzene control (and any necessary octane recovery) equipment in time to meet
the required standards. We have chosen to finalize a four-year period of additional lead
time for small refiners, until January 1, 2015 to comply with the 0.62 vol% annual
average benzene standard. This amount of lead time was supported by all commenters on
the issue. We are also finalizing 4 years of additional lead time, until July 1, 2016, for
small refiners to meet the 1.3 vol% refinery maximum average benzene standard. As
discussed more fully below, we are also finalizing a review of the ABT program after the
first year of the program. The four-year lead time period will provide small refiners with
nearly three years of lead time following the review to complete any necessary capital
projects.
We do not agree with the comment that small refiners, as a class, should simply
not be subject to the benzene standards in the rule. As shown in chapters 9 and 14 of the
RIA, as well as in the preamble to the final rule, small refiners can achieve the standards
adopted in the rule. Exempting small refiners as a class would therefore result in a fuel
program that did not obtain the greatest emission reductions of toxics achievable from
motor vehicle fuels. We believe that individual small refineries incurring extreme
economic hardship as a result of the rule may be eligible for some type of hardship
waiver, as explained below. Any such relief, however, would be on a case-by-case basis
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reflecting the refiner's situation after making good faith efforts to comply, and should not
(and legally cannot) be adopted now for the entire class of small refiners.
We do accept the comment that it is possible that for some small refiners,
compliance with the 0.62 vol% annual average standard through purchase of credits may
prove to be infeasible and have added an additional hardship provision to the final rule to
accommodate such a possibility. As discussed in more detail in section VI.A.S.a.iii of the
preamble to the final rule, we are finalizing an additional hardship provision exclusively
for approved small refiners to cover the case of a small refiner for which compliance with
the 0.62 vol% annual average standard would be feasible only through the purchase of
credits, but for whom the purchase of credits is not practically or economically feasible.
This hardship provision will only be available following the ABT program review, as the
most accurate information to assess credit availability and the workings of the credit
market are necessary to evaluate this type of claim of hardship. Hardship relief under this
provision will only be afforded to a small refiner on a case-by-case basis, and must be
based on a showing by the refiner of the practical or economic difficulty in acquiring
credits for compliance with the 0.62 vol% benzene standard. Hardship relief under this
provision, if granted, would consist of a further delay, on an individual refinery basis, for
up to two years. Following the two years, a small refiner will be allowed to request one
or more extensions of the compliance date for the 0.62 vol% annual average benzene
standard until the refinery's material situation has changed.
In addition, the general hardship relief provisions discussed in section VI.A.S.b of
the preamble are available to any refiner, including the situations that could arise for
small refiners. This includes hardship in meeting the 1.3 vol% maximum average
standard, as discussed below.
4.9.1.2 ABT Program
What Commenters Said:
The Small Refiners commented that, in addition to additional lead-time, they
strongly endorse: a nationwide ABT program which allows small refiners to earn credits
and also includes some provisions to encourage more credit trading to small refiners (i.e.,
the extension of credit life by two years if generated by, or traded to, small refiners); a
review of the ABT program and the small refiner flexibility options by 2012, including
the submission of pre-compliance reports; and consideration of additional small refiner
provisions on a case-by-case basis, depending upon the results of the ABT program
review. In addition, the commenters stated that equally as significant are the design and
review of the ABT program. The Small Refiners noted that many small refiners estimate
their benzene reduction costs to be higher on a per gallon basis than EPA's estimates,
thus they believe that, for many, the only feasible approach [to meet the 0.62 vol%
benzene standard] will be to purchase credits. The Small Refiners stated that compliance
with desulfurization regulations and planned refinery expansions are expected to increase
benzene production. Therefore, the commenters stated that they believe it is essential
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that the availability and cost of credits be known as soon as possible (well before the
small refiner compliance deadline) and that steps must be taken to ensure a functional
credit market with reasonable credit costs.
The Small Refiners also commented that they believe that provisions should be
included to address enforceability with regard to extended credit life for small refiner
standard credits in light of the five-year statute of limitations on EPA enforcement
activities. The commenters suggested that enforceability could be addressed in spite of
the statute of limitations with a relatively simple approach of suspending the right to
participate in the credit program of any small refiner that abuses the system. The
commenters also stated that they believe that the proposed requirement for annual
compliance reports will provide a relevant data base, and that suspensions could be for a
definite period of time for first or second violations, working up to indefinite suspension
if transgressions are repeated.
Letters:
Ad Hoc Coalition of Small Business Refiners OAR-2005-0036-0686
Our Response:
We are in fact finalizing an early credit generation provision to allow small
refiners the opportunity to generate early credits for reductions of at least ten percent of
the refiner's 2004-2005 benzene levels prior to the small refiner compliance deadline on
January 1, 2015. We believe that early credit generation opportunities for small refiners
will provide more credits for the MSAT2 ABT program. Further, it will help to achieve
the air quality goals of the MSAT2 program earlier than otherwise required, as there will
be an incentive for these refiners to reduce their benzene levels prior to the small refiner
compliance deadlines. The small refiner early credit generation period will be from June
1, 2007 to December 31, 2014, after which standard credits may be generated indefinitely
for those that overcomply with the 0.62 vol% annual average standard.
We are also finalizing provisions for extended credit life, to increase the certainty
that credits will be available. We believe that this will encourage trading to small
refiners. We are finalizing that standard credits traded to, and ultimately used by, small
refiners will receive an additional two years of credit life. The extension does not apply
to early credits because refiners already have an incentive to trade early credits to small
refiners. Based on the nature of the early credit life program (three-year life based on the
start of the program in 2011) and small refiners' delayed program start date in 2015, early
credits traded to small refiners are already valid for an additional four years. Further, we
do not believe that there is a need to extend credit life for credits generated by small
refiners, because in this event, the small refiner would already have the utmost certainly
that the credits would be available for use. Regarding the commenters' note about the
five-year statute of limitations on EPA enforcement activities, this is discussed fully in
section 4.7.4.2, above.
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4.9.1.3 ABT Program Review
What Commenters Said:
A number of commenters stated that they support the proposed EPA review of the
ABT program in 2011. The commenters reiterated that a review of both the credit
program and the small refiner flexibility options by 2012 is essential because of the
critical importance to small refiners of a viable credit system and the fact that some small
refiners believe that it will be economically and/or technically necessary for them to
purchase and use credits.
The Small Refiners specifically requested that EPA include small refiners in the
development of the final design for the program review and in the review process/credit
program evaluation itself. The commenters stated that they believe it will be important
that the review include an evaluation of small refiner benzene reduction capital
equipment and operating costs compared with the cost of credits. The commenters
further suggested that EPA perform annual reviews to assess potential changes in the
credit marketplace. The Small Refiners also offered comments on elements that they
believe should be included in the review, and actions that might follow the review:
1) Revisiting the small refiner provisions if it is found that the credit trading market
does not exist to a sufficient degree to allow small refiners to purchase credits, or that
credits are only available at a cost-prohibitive price. Revisions could include additional
hardship provisions on a case-by-case basis, such as further delay or relaxation of the
standard with the possibility of multiple extensions until the refinery's material situation
changes.
2) Options to either help the credit market or help small refiners gain access to
credits if it is found that there is not an ample supply of credits or that small refiners are
having difficulty obtaining them. One option suggested was the "creation" of credits by
EPA to introduce into the credit market, or imposing additional requirements to
encourage trading with small refiners (e.g., requiring a percentage of all credits be set
aside for small refiners only, requiring that some credits be made available to small
refiners before they can be sold to any other refiners).
Letters:
Ad Hoc Coalition of Small Business Refiners OAR-2005-0036-0686
Caribbean Petroleum Corporation OAR-2005-0036-1010
Colonial Oil Industries, Inc. OAR-2005-0036-0990
Gladieux Trading & Marketing Co., L.P. OAR-2005-0036-0972
U.S. Oil & Refining Company OAR-2005-0036-0992
Our Response:
EPA will review the ABT program (and thus, the small refiner flexibility options)
in 2012, one year after the general program for the 0.62 vol% annual average benzene
standard begins. Coupled with the small refiner four-year additional lead time provision,
the ABT program review after the first year of the overall program will provide small
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refiners with roughly more three years, after learning the results of the review, to obtain
financing and perform engineering and construction with respect to that standard. In part
to support the review, we are requiring that refiners submit pre-compliance reports,
similar to those required under the highway and nonroad diesel programs. This review
will take into account the number of early credits generated industry-wide each year prior
to the start of the MSAT2 program, as well as the number of credits generated and
transferred during the first year of the overall benzene control program. Section
VI.A.2.a.iii of the preamble to the final rule contains detailed information on the
requirements for the ABT pre-compliance reports. EPA will publish generalized
summaries (to maintain the confidentiality of information from individual refiners
submitted in the reports) of the reports annually. We will also take input on how to
conduct the review and potential options to consider if a viable credit market does not
exist.
If, following the review, EPA finds that the credit market is significantly at odds
with the assumptions underlying the final rule provisions for small refiners, we will
revisit the provisions to determine whether or not they should be altered or whether EPA
can assist the credit market (and small refiners' access to credits). Further, as noted
above in section 4.9.1.1, if we find that some small refiners still cannot comply with the
0.62 vol% benzene standard even with a viable credit market and that credit purchase is
the refiner's only option for compliance with the standard, we are finalizing an additional
hardship provision to potentially assist those small refiners.
4.9.1.4 Concerns with 1.3 Vol% Refinery Maximum Average Standard
What Commenters Said:
Representatives of small refiners were critical of the possibility of adding a 1.3
vol% refinery maximum average to the fuel benzene standards. They expressed their
concerns in both written and oral statements to the agency, challenging both the
maximum average standard and the procedures by which it was adopted. They maintain
that the imposition of a 1.3 vol% refinery maximum average violates the Regulatory
Flexibility Act (RFA), as amended by the Small Business Regulatory Enforcement
Fairness Act of 1996 because the Small Business Advocacy Review (SBAR) Panel did
not have the opportunity to review the impacts of such a standard on small businesses.
At a minimum, they believe EPA would need to present the maximum average provision
to the Panel for its consideration prior to including it as part of a final rule (citing 5
U.S.C. § 609). They add that the possibility of a maximum average was never raised
during the SBAR Panel process which assessed the impact of an MSAT2 rulemaking.
They continue that had it been, the small refiner representatives would have opposed the
concept as greatly damaging to their segment of the industry. They further contend that
such a maximum average significantly changes the economics of small refiner
compliance and that it should (and must) be considered by an SBAR Panel before a rule
is finalized.
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The commenters also stated that there are at least eight small refiners that have
benzene levels above 1.3 vol%. The commenters also expressed concerns such as
maintaining octane levels, costs for transportation of extracted benzene, and ability to
locate other treatment facilities. More generally, they stated that applying the maximum
average to small refiners is at odds with the premise of the proposed rule: that unlimited
ABT is needed to provide sufficient flexibilities for refiners which otherwise would need
to make expensive capital investments. They stated that for many small refineries, the
cost of meeting the 1.3% level will require significant capital investment and likely
would remove them from the credit buying market not only to meet the 1.3 vol% levels,
but also at levels below 1.3%. They continued that the inability of small refiners
currently above 1.3% benzene gasoline levels to comply with credits threatens the very
existence of those refiners and calls into question EPA's assumptions regarding impact of
the rule on fuel supply. They maintain that EPA itself recognized that absent small
refiner flexibilities, EPA would likely have to consider setting a less stringent benzene
standard or delaying the overall program to diminish burden on small refineries (citing 71
FR 15877). Given these concerns about the inability to use credits to meet levels above
1.3 vol%, thus they suggested that EPA should allow small refiners to use credits for
compliance with the 1.3 vol% refinery maximum average, with either a PADD restriction
on credit trading or discounting credits used to meet the 1.3 vol% standard.
Letters:
Ad-Hoc Coalition of Small Business Refiners OAR-2005-0036 (late comments)
Our Response:
EPA disagrees that adopting a refinery maximum average in the final rule without
specifically presenting the option for consideration by the section 609 SB AR Panel, or
without reconvening that panel, violates the requirements of the Regulatory Flexibility
Act (RFA), as amended by the Small Business Regulatory Enforcement Fairness Act of
1996. Section 609 imposes various procedural requirements for gathering comments
from small entities when EPA promulgates a rule which will have a significant economic
impact on a substantial number of small entities (as the MSAT2 fuel provisions do). EPA
complied with all of these requirements. EPA conducted outreach to small entities and
convened an SBAR Panel to obtain advice and recommendations of representatives of the
small refiner industry. Section 609(b) requires that an SBAR Panel be convened before
EPA publishes a notice of proposed rulemaking, and this Panel was timely convened.
Section 609(b)(4) further requires the panel to "review any material the agency has
prepared in connection with this chapter, including any draft proposed rule". This
provision does not contemplate that the Panel have before it every detail of a proposed
rule, given that the Panel's deliberations occur pre-proposal. EPA provided the SBAR
Panel with the material required by section 609(b)(4), and also complied with the
requirements of section 603 by preparing and publishing an initial regulatory flexibility
analysis with the notice of proposed rulemaking. Furthermore, EPA considered the
SBAR Panel recommendations carefully, and proposed many of them as part of the
proposed rule (see generally 71 FR 15924-926). Indeed, EPA decided to adopt many of
the recommendations as provisions in the final rule, including separate lead time for
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compliance with the 0.62 vol% annual average benzene standard, extended opportunities
to generate early credits for the ABT program, as well as various hardship provisions to
accommodate situations where individual refiners (both small and non-small) incur
significant economic hardship after making best efforts to comply.
EPA also complied fully with the requirements of section 604 of SBREFA,
preparing a final regulatory flexibility analysis (found in chapter 14 of the RIA) which,
among other things, describes small refiner entities to which the rule applies, estimates
their compliance burdens, and describes steps EPA has taken to minimize significant
impact of the rule on small refiners. These steps, in addition to those described in the
previous paragraph, include extended lead time for complying with the 1.3 vol% refinery
maximum average, a small refiner-specific hardship provision for small refiners that are
only able to comply with the 0.62 vol% annual average benzene requirement through
purchase of credits and find themselves unable to do so, and a clarification of the
circumstances under which the other hardship provisions in the final rule could apply.
The commenter maintains, in essence, that EPA cannot lawfully make changes to
a rule between the convening of an SBAR Panel and publication of the final rule, or at
least cannot lawfully do so without reconvening the Panel. The RFA contains no such
requirements. The statute, in fact, contemplates that there will be changes between
proposed and final rules, and states that EPA's only procedural requirement in such a
case is to describe that change in the Final Regulatory Flexibility Analysis. See section
604 (a)(2) (each Final Regulatory Flexibility Analysis "shall contain a summary of the
significant issues raised by the public comments in response to the initial regulatory
flexibility analysis, a summary of the assessment of the agency of such issues, and a
statement of any changes made in the proposed rule as a result of such comments"). EPA
has fully complied with this requirement. Moreover, as explained above, there is no
requirement that a Panel be presented with every provision an agency proposes, much
less every provision ultimately adopted as a final rule. The RFA also contains no
requirement that EPA reconvene a Panel between the proposed rulemaking and the final
rulemaking.
Nor were the small refiners prejudiced by the procedures EPA used to adopt the
maximum average requirement. EPA solicited comment on the option of adopting a 1.3
vol% maximum average (71 FR 15869, 15903) and received comment on the issue
(including from small refiners). EPA thus adopted the maximum average requirement in
compliance with procedures required by the RFA.
We have carefully evaluated the potential impacts on small refiners of meeting the
1.3 vol% maximum average standard (as well as the 0.62 vol% annual average standard).
As explained in detail in chapter 14 of the RIA, we believe that it is both technically and
economically feasible for small refiners to meet these standards. Indeed, there are
compliance options for small refiners that are less costly than those we used for our cost
estimates (see RIA section 9.3). The rule also accommodates circumstances of small
refiners by including four extra years of lead time to comply with the maximum average
standard (in keeping with our discussion at 71 FR 15877-78 cited by the commenter
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explaining why additional lead time is often needed for small refiners to comply with fuel
standards). We have also added provisions to the general hardship provision at section
80.1335(c)(2), and clarified in the preamble to the final rule (section VI.A.S.b), that an
individual refiner which demonstrates that it would incur significant hardship in
complying with the maximum average standard may obtain one or more waivers of the
standard's compliance date. We thus do not agree with the comments that the maximum
average requirement is infeasible for small refiners and that the inclusion of the provision
will undermine conclusion's about the rule's effect on fuel supply, or that the standard
should be more lenient or not apply at all to small refiners.
We also disagree with the suggestion that small refiners be permitted to comply
with the maximum average standard through use of PADD-specific credits. Geographic
restrictions on credit use can prove to be very problematic. PADD restricted trading
would necessitate that we set different standards in different PADDs, due to the different
level of benzene reductions achievable considering cost and other factors in those
PADDs. The annual average standard would, by necessity, have to be less stringent in
some PADDs than the 0.62 vol% annual average standard that we are setting. This
would also reduce the liquidity of the credit trading market, and thus drive up the costs of
the program. We do not see this step as necessary given our analysis showing that the
maximum average standard is feasible at reasonable cost for all refiners, including small
refiners.
We believe that setting a nationwide standard with nationwide credit trading (to
meet the 0.62 vol% annual average benzene standard) will meet the environmental goals
of the program as well as the needs of refiners. We believe that even with a maximum
average standard, the combination of provisions that we are finalizing will minimize the
likelihood of extreme hardship for small refiners. As discussed earlier, we are finalizing
several significant relief provisions that apply specifically to small refiners, namely four
years of additional lead-time to meet the 1.3 vol% maximum average (until July 1, 2016).
Further, the hardship provisions that we are finalizing are available to all refiners, and
these provisions could apply to situations that the commenters identified may still occur.
Please see section 4.1.1.4 of this Summary and Analysis document for a greater
discussion on the 1.3 vol% maximum average.
4.9.1.5 Small Refiner Criteria
What Commenters Said:
We received comments regarding the criteria to qualify for small refiner status.
The commenters stated that they believe that EPA should consider expanding the criteria
to allow other refiners that would not otherwise qualify as small refiners to do so.
The commenters stated that many refineries located in PADD 5, including Alaska
and Hawaii, are close in size to small refiners located in PADD 4. The commenters
stated that they believe refineries in these western PADDs also face geographic
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challenges in contracting labor and professional services. The commenters further stated
that refiners in these regions possess many of the same limitations and challenges that
EPA has identified with small refineries, and they thus believe the rule needs to change to
reflect this. The commenters stated that they believe that allowing additional time for
non-small refineries to comply with the proposed benzene standard would help to level
the competitive playing field.
Other commenters stated that they believe that EPA should abandon the criteria
required to small refiner qualification criteria that were proposed (and have been used in
prior fuels programs), and instead look to the definitions given in recent Congressional
programs. The commenters stated that they believe that EPA's criteria of 1,500 or less
employees and crude capacity limit of 155,000 barrels per calendar day (bpcd) are not
adequate for determining which companies should receive regulatory flexibility. The
Congressional programs that the commenters cited were the American Jobs Creation Act
of 2004 (Jobs Act) and the Energy Policy Act of 2005 (Energy Act), both of which
contained small refiner or refinery definitions that differ from EPA's criteria. The Jobs
Act defines a small refiner as a refiner with a maximum of 1,500 employees in refinery
operations only and a crude capacity limit of 205,000 bpcd, while the Energy Act's
defines a small refinery as a refinery with a crude capacity limit of 75,000 bpcd. The
commenters stated that they believe that EPA should use one of these definitions to
determine which companies qualify as small.
One commenter specifically noted that it believes that the Small Business
Administration's (SBA) definition, which EPA's small refiner criteria are largely based
on, is intended to give preferences to small businesses under various government
programs and was not written with any specific consideration of the refinery industry.
The commenter stated that it believes that using employee count ignores the reality that
some refiners are small within the industry but have an employee count swelled by
employees in operations unrelated to refining. The commenter further noted that it
believes that employee count does not measure of the relative size, financial strength, or
the resources available to the company for regulatory compliance. Rather, the
commenter stated that it believes that refining capacity is a more accurate and equitable
measure of the "smallness" of a refiner—such as the definition provided in the Energy
Act. The commenter thus proposed that the rule should define small refiner as: (1) no
more than 1,500 employees engaged in refinery operations and no more than 155,000
bpcd crude oil capacity on a company-wide basis; or (2) no more than 155,000 bpcd
crude oil capacity on a company-wide basis. The commenter also stated that the rule
could, alternatively, extend additional compliance time to each "small refinery", defined
as one with a crude oil capacity of no more than 100,000 bpcd.
Another commenter suggested that in the final rulemaking, EPA should use the
Energy Act small refinery definition to eliminate "confusion and inequities." The
commenter further stated that it believes that the definition should be based on the
relative size of the physical plant (i.e., the amount of crude oil the refinery can process).
The commenter also stated that EPA could alternatively use the small refiner definition
from the Jobs Act.
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Letters:
Giant Industries, Inc. OAR-2005-0036-0831
Sinclair Oil Corporation, Flying J. Inc., Suncor Energy (U.S.A.) Inc., and Tesoro
Corporation OAR-2005-0036-0989
United Refining Company OAR-2005-0036-0827
United States Senator Michael Enzi, et al. OAR-2005-0036
Our Response:
EPA's small refiner criteria are largely based on the Small Business
Administration (SBA) definition of a small refiner. The small business employee criteria
were established for SBA's small business definition (per 13 CFR 121.201) to set apart
those companies which are most likely to be at an inherent economic disadvantage
relative to larger businesses. This definition must also be used during the Small Business
Regulatory Enforcement Fairness Act (SBREFA) Panel process to determine which
companies are considered small businesses. Under this process, EPA is required to focus
consideration on small businesses and evaluate the burdens that a proposed rule would
impose, and potential mechanisms to relieve burdens where appropriate. SBREFA and
the Regulatory Flexibility Act require agencies to perform this assessment prior to each
significant rulemaking that has a significant impact on a substantial number of small
businesses. In keeping with the intent of SBREFA, EPA's overall approach in
regulations establishing broadly applicable fuel standards has been to limit the small
refiner relief provisions to the subset of refiners that are likely to be seriously
economically challenged as a result of new regulations due to their size.
The Energy Policy Act of 2005 (EPAct) and the American Jobs Creation Act of
2004 (Jobs Act) both use definitions that are different from the SBA definition, and from
the criteria EPA is adopting in this rule. The EPAct focuses on refinery size rather than
company size, while the Jobs Act focuses on refinery-only employees rather than
employees company-wide. The EP Act's definition is that a small refinery is one that
produces no more than 75,000 bpcd. The Jobs Act definition states that a small refiner is
one that produces no more than 205,000 barrels bpcd and employs no more than 1,500
employees in its refinery operations alone. Under programs subject to the EPAct and
Jobs Act definitions, relief would be granted to refineries that are owned by larger
companies, or companies that have additional sources of revenue (indicated by more
employees and/or refining capacity), and also refineries owned by foreign governments.
These definitions do not focus as directly on refiners which, due to their size, could incur
serious adverse economic impact from fuel regulations; and EPA consequently is not
adopting either of them in this rule.
It is true that the EPAct definition is applicable to the Renewable Fuels Program
under section 21 l(o) of the Clean Air Act, but by its terms it does not apply to the MS AT
program (which implements different statutory provisions). Therefore, for the
Renewable Fuels Standard proposal (71 FR 55552, September 22, 2006), EPA proposed
to apply the 75,000 bpcd small refinery definition. However, even here, because it was
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appropriate under the facts, EPA also proposed to apply the small refiner criteria from
our previous fuel regulations as part of the RFS program.
We note that the small refiner provisions act to delay obligations to comply with
fuel standards and do not act as a complete exemption from such requirements. In
addition, the small refiner provisions represent one option in which requirements can be
delayed under this program. The general hardship provisions (as discussed further in
section VI.A.S.b) are available to all refiners, regardless of whether or not they meet the
small refiner criteria. Under these hardship provisions, a refiner that can demonstrate
financial and/or technical hardship in complying with the requirements of the regulation
may apply under the general hardship provisions. Based on a case-by-case
determination, EPA can than grant hardship relief which can act to delay requirements in
a manner similar to the small refiner definition.
With regard to the comments on the small refiners' difficulty in meeting the 1.3
vol% refinery maximum average, we do understand the commenters' concerns.
However, geographic restrictions on credit use can prove to be very problematic. We
believe that, given the national trading of credits to meet the 0.62 vol% annual average
benzene standard, neither the goals of refiners nor environmental goals could be met with
such a program. We believe that even with a maximum average standard, the
combination of provisions that we are finalizing will minimize the likelihood of extreme
hardship for small refiners. As discussed earlier, we are finalizing several significant
relief provisions that apply specifically to small refiners, namely four years of additional
lead-time to meet the 1.3 vol% maximum average (until July 1, 2016). Further, the
hardship provisions that we are finalizing are available to all refiners, and these
provisions could apply to situations that the commenters identified may still occur.
4.9.1.6 Other
What Commenters Said:
Caribbean Petroleum Corporation and U.S. Oil and Refining Company both
commented that they believe that the final rule should allow all refinery restarts the
opportunity to participate as small refiners if they meet all requirements other than an
ownership or operating status on a given date.
Caribbean and U.S. Oil also both commented that they believe that the rule should
encourage refinery capacity increases (and further, any new rulemaking should do that
when possible).
Letters:
Caribbean Petroleum Corporation OAR-2005-0036-1010
U.S. Oil & Refining Company OAR-2005-0036-0992
Our Response:
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Our intent has been, and continues to be, limiting the small refiner relief
provisions to the small subset of refiners that are likely to be seriously economically
challenged as a result of the new regulations. Similar to earlier fuel rules, we are
finalizing a provision that a refiner that restarts a refinery in the future is eligible for
small refiner status to account for refineries that may have been temporarily shut down
during the baseline year(s) but would otherwise have met the criteria. In such cases, we
will judge eligibility under the employment and crude oil capacity criteria based on the
most recent 12 consecutive months before the application, unless we conclude from data
provided by the refiner that another period of time is more appropriate. However, unlike
past fuel rules, this will be limited to a company that owned the refinery at the time that it
was shut down. New purchasers will not be eligible for small refiner status. We assume
that new owners that purchase a refinery after December 31, 2005 do so with full
knowledge of the regulation. Given that they have the resources available to purchase the
refinery assets, they are not in an economic hardship situation. Therefore, simply put,
they can and should include compliance planning as part of their purchase decision.
Companies with refineries built after January 1, 2005 will also not be eligible for the
small refiner hardship provisions, again for the reasons given above.
In response to the comments regarding encouraging refinery capacity increases, as
in past fuels programs, approved small refiners that grow by normal business practices
will not lose their small refiner status for the MSAT2 program. This was discussed
during the Small Business Regulatory Enforcement Act (SBREFA) Panel process. We
agreed then, as we do now, that small refiner growth by normal business practice should
not be discouraged by our regulations.
4.9.2 Other Hardship Provisions
What Commenters Said:
The Municipality of Anchorage, Department of Health and Human Services
commented that it fears that credits and accommodation for economic hardship included
in the proposed rule may allow benzene concentrations to remain unchanged in Alaska
fuel. The commenter stated that it believes that the modest volume of fuel refined in
Alaska may lead to claims of economic hardship by local refiners. The commenter noted
that, since there is no market for extracted benzene in Alaska, the cost of shipping
benzene out of the state may be more costly than potentially expensive refinery
modifications. The commenter stated that it would be very disappointing if credits from
refineries outside the state were used to support the continuation of current gasoline
formulations. The commenter noted that Canadian regulations employ a per-gallon-cap
limitation on benzene content with a lower averaging standard; and the commenter
recommended that a similar provision be included in the rule to ensure that some
reduction in benzene content is accomplished in small markets.
Letters:
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Municipality of Anchorage, Department of Health and Human Services OAR-2005-
0036-0976
Our Response:
Based on our refinery-by-refinery modeling, we believe that the 0.62 vol% annual
average standard will provide a strong incentive for benzene reductions nationwide,
including Alaska. In order to provide greater assurance that the modeled reductions
occur, we are also finalizing a 1.3 vol% maximum average standard that will preclude
refineries from remaining above that level for their actual production. While there are
provisions for small refiner relief and hardship relief for any size refiner, these may only
serve to delay application of the standard, not waive it indefinitely.
4.10 Western Refiner Issues
What Commenters Said:
We received comments from a group of refiners in the Rocky Mountain and
Pacific Northwest regions (Petroleum Districts for Defense (PADDs) 4 and 5,
respectively). These refiners commented that they believe that refiners in PADDs 4 and
5 will face compliance challenges with the proposed rule that are considerably more
significant than refineries would face elsewhere in the county, as the current gasoline
benzene levels for refiners in these areas are well above the national average of 0.97
vol%. The refiners stated that they believe that facilities in their region face the greatest
compliance difficulty under the proposed regulation. The commenters further stated they
believe that the impact of the regulation is even more challenging for small and
independent refiners who have limited averaging options and whose refining operations
are concentrated in PADDs 4 and 5.
The commenters stated that they believe other major regulations, along with
significant capacity expansions and other major refinery projects, all compete with each
other for funding and other resources, and they encourage EPA to sequence the
requirements for benzene control relative to these other regulations would be beneficial.
They also point to EPA analysis in the proposal showing that refiners in PADDs 4 and 5
will experience the highest compliance costs. The commenters also state that the rule
favors large multi-refinery refiners over small and independent refiners because the ABT
program's provision for intra-company trading is of more use the more refineries a
company own.
In general, the commenters believe that refiners in these areas should receive the
same 4-year delay in the benzene requirements as small refiners. The also suggested a
specific provisions where refineries in these PADDs be permitted to delay compliance
with the 0.62 vol% benzene standard until January 1, 2015 (similar to the small refiner
program start date) if they opted to comply with a maximum average benzene standard of
1.3 vol% on a permanent basis. If EPA adopted this approach, the commenters also
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suggested that refiners with more than one refinery in either PADD have the flexibility to
meet the 1.3 vol% annual average gasoline benzene standard across the PADD if the
facilities are located not more than 100 miles apart. The commenters stated that they
believe this option would assure that bona fide gasoline benzene reductions will be made
in the regions where average levels are the highest.
Letters:
Sinclair Oil Corporation, Flying J. Inc., Suncor Energy (U.S.A.) Inc., and Tesoro
Corporation OAR-2005-0036-0989
Our Response:
We have carefully assessed the comments from this group of refiners. Our
analysis confirms that refineries in PADDs 4 and 5 tend to have higher benzene levels
than refineries in other parts of the country. Our analysis also shows that the costs for
compliance will likely be greater for refineries in PADDs 4 and 5 than for other
refineries. We recognized this diversity in benzene levels across the country in the
design of the program by including a nationwide ABT program with no geographic
restrictions. We also considered refineries in all parts of the country in assessing the
necessary lead time for compliance.
Overall, we considered characteristics of refineries in the western part of the
country, as well as all other refineries, as a part of our analyses supporting the proposed
rule, and these characteristics continue to be included in our final rule analyses. We
continue to believe that this program very effectively balances the concerns of a wide
range of stakeholders in all parts of the country, including this group of refiners. The
nationwide ABT program is designed to allow refiners to, in effect, phase in compliance
with the 0.62 vol% average standard by generating early credits through partial
reductions and then use those credits to postpone full compliance. Refiners can also
purchase credits for the same purpose. The additional 18 months that we are providing
for compliance with the 1.3 vol% maximum average standard is also intended to allow
full use of the credit program through that date. Our analyses indicate that the average
standard of 0.62 vol% and the 1.3 vol% maximum average standard, in the context of the
nationwide ABT program, will be achievable by all refineries by the respective
compliance dates. (See also the discussion of leadtime in section 4.3 above.) In the
event that refineries still face extreme hardship situations as defined in the rule, EPA can
provide compliance relief on a case-by-case basis.
Regarding the commenters' proposal that refiners in their region be treated as
small refiners under this program, we address the issues of expanding the criteria for
small refiner status in section 4.9 above.
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5. PORTABLE FUEL CONTAINERS
What We Proposed:
The comments in this section correspond to Section VIII of the NPRM, and therefore
deal with our proposed regulations for portable fuel containers (PFCs). A summary of the
comments received, as well as our response to those comments, are located below. For the full
text of comments summarized here, please refer to the public record for this rulemaking.
5.1 Standards
General Support for Standards
What Commenters Said:
We received several comments in strong support of our proposed gas can program.
The Portable Fuel Container Manufacturers Association (PFCMA) commented that
several states have adopted California's program. They commented that they "welcome and
support a national standard as proposed by the EPA" and look forward to having a national
conformity to the standards. DSD International (DSD) also expressed support for the new
standards.
The Alaska Department of Environmental Conservation (ADEC) commented that it
agrees that the gas can provision has potential to improve air quality for those who store gasoline
in or near a living space. This situation is prevalent in Alaska; particularly in village homes
where residents keep fuel indoors to keep fuel from gelling in the extreme winter cold. Fuel
costs in rural Alaska are the highest in the country. Thus, gas can technologies will save money
over a 5 year life span by reducing volatilization and loss of product. ADEC further stated that
the gas can provisions will assist their efforts to reduce exposures to benzene.
The New York Department of Environmental Conservation (NYDEC) commented that it
generally approves of EPA's proposed portable fuel container standards. Volatile Organic
Compound (VOC) emissions from this source category continue to be a significant concern to
the NYDEC. New York adopted portable fuel container standards effective October 4, 2002
based on the then current California standards. EPA's proposed standards are mostly based on
revised California standards and are a welcome improvement over existing standards.
STAPPA and ALAPCO commented that their associations agree with EPA's assessment
that emissions from portable gasoline containers contribute significantly to personal exposure to
mobile source air toxics and with the agency's proposal to limit gas can hydrocarbon emissions
from these containers nationally, consistent with California's revised program. In their hearing
testimony, STAPPA and ALAPCO commented that they are pleased that the Agency has
acknowledged that emissions from gasoline containers are significant contributors to levels of
mobile source air toxics. NESCAUM also expressed support for the new standards.
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The Illinois Environmental Protection Agency (IL EPA) commented that it supports the
inclusion of portable gasoline containers within the MSAT proposal. IL EPA also stated that it
has long considered these containers to be significant sources of emissions, and it believes that a
national rule dealing with this consumer product to be the most effective and efficient way to
address this source. Wisconsin Department of Natural Resources, Bureau of Air (WDNR) also
commented that it is very pleased that federal fuel container standards are being proposed and
that EPA has harmonized its proposal with the latest California gas can standards to a great
extent.
Letters:
Alaska Department of Environmental Conservation (ADEC) OAR-2005-0036-0975
American Lung Association (ALA) OAR-2005-0036-0365 (Hearing testimony)
DSD International Inc. OAR-2005-0036-0377
Illinois Environmental Protection Agency (IL EPA) OAR-2005-0036-0830
New Jersey Department of Environmental Protection, Division of Air Quality (NJ DEP) OAR-
2005-0036-0829
New York Department of Environmental Conservation (NYDEC) OAR-2005-0036-0722
NESCAUM OAR-2005-0036-0993
State and Territorial Air Pollution Program Administrators/Association of Local Air Pollution
Control Officials (STAPPA/ALAPCO) OAR-2005-0036-0836
Wisconsin Department of Natural Resources, Bureau of Air (WDNR) OAR-2005-0036-
0828
Portable Fuel Container Manufacturers Association (PFCMA) OAR-2005-0036-0365
(hearing testimony)
Portable Fuel Container Manufacturers Association (PFCMA), OAR-2005-0036-0819
Our Response:
We appreciate the comments in support of including PFCs in the program. We continue
to believe that PFCs are a significant source of VOC emissions (including air toxics). These
emissions also can significantly contribute to elevated indoor exposure. We also concur with
comments that reducing emissions from PFCs will result in fuel savings. Finally, as commenters
suggested, we have maintained our proposed approach to the standards and other provisions
which are similar to those contained in the recently revised California program.
Support for Including Diesel and Kerosene Containers and Utility Jugs
What Commenters Said:
Several commenters supported including diesel and kerosene containers and utility jugs
in the program, similar to the recently modified California Air Resources Board (CARB)
standard. The NYDEC commented that it is concerned that EPA's current proposal does not
reflect the full scope of the modified CARB rules which would regulate kerosene containers and
utility jugs in addition to traditional gasoline cans; CARB noted in its adoption of the revised
Portable Fuel Container Standards that there is evidence of consumers using these alternative
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containers to circumvent the rule, so CARB expanded the scope of its rule. We did not receive
any non-supportive comments on including these additional containers in the program.
Letters:
DSD International Inc. OAR-2005-0036-0377
New Jersey Department of Environmental Protection, Division of Air Quality (NJ DEP) OAR-
2005-0036-0829
New York Department of Environmental Conservation (NYDEC) OAR-2005-0036-0722
NESCAUM OAR-2005-0036-0993
STAPPA/ALAPCO OAR-2005-0036-0836
Our Response:
In the final rule, we have decided to apply the new standards to diesel and kerosene
containers in addition to gasoline containers. In the proposal, we specifically requested comment
on applying the emissions control requirements being proposed for gasoline containers to diesel
and kerosene containers. California included diesel and kerosene cans in their regulations
largely due to the concern that they would be purchased as substitutes for gasoline containers.
We recognize that using uncontrolled diesel and kerosene containers as a substitute for
gasoline containers would result in a forgone emissions reductions. California collected limited
survey data which indicated that about 60 percent of kerosene containers were being used for
gasoline. In addition, keeping gasoline in containers marked for other fuels could lead to
misfueling of equipment and possible safety issues. Finally, as indicated by the comments
above, not including these containers would be viewed as a gap in EPA's program, which would
likely lead to states adopting or retaining their own emissions control program for PFCs. We
believe this would hamper the ability of manufacturers to have a 50-state product line, as they
desire. For these reasons, we agree with commenters and have included diesel and kerosene
containers in the program.
Commenters also supported including utility jugs in the program. We are clarifying
that utility jugs are considered to be gasoline containers under the rule and therefore are subject
to the requirements of the program. Utility jugs are designed and marketed for use with gasoline,
often to fuel recreational equipment such as all-terrain vehicles and personal watercraft.
California, which similarly defines PFCs to include these containers, recently issued a
clarification that these containers are covered by their program, after some utility jug
manufacturers failed to meet the existing California requirements.
5.2 Timing
What Commenters Said:
We received several comments recommending that the container requirements take effect
on January 1, 2008 rather than EPA's proposed date of January 1, 2009. NESCAUM
commented that many states have already adopted California's program and that EPA should
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require introduction of the PFC standards beginning in 2008, rather than the proposed
implementation year of 2009. IL EPA commented that the technology is currently available, so
they recommend that the program begin on January 1, 2008 rather than 2009.
Letters:
Illinois Environmental Protection Agency (IL EPA) OAR-2005-0036-0830
NESCAUM OAR-2005-0036-0993
STAPPA/ALAPCO OAR-2005-0036-0836
Our Response:
We must provide lead time to manufacturers to review the final rule, finalize their
product designs, and perform the EPA emissions certification process (which is likely to take
about 6 months for testing, submittal to EPA, and approval). We also must provide
manufacturers with time to ramp up production for a nationwide program. We believe a January
1, 2008 start date recommended by commenters would not provide enough lead time and could
result in some products not being available to consumers. Therefore, we are retaining the
January 1, 2009 start date as proposed.
5.3 Certification and Test Procedures
Testing With Ethanol-based Fuels
What Commenters Said:
The WDNR commented that the portable fuel containers need to be tested with ethanol-
based fuels in order to ensure that the permeation and evaporation rates do not increase with the
use of ethanol fuels and that the materials used in these gas cans are not adversely affected.
Letters:
Wisconsin Department of Natural Resources, Bureau of Air Management (WDNR) OAR-
2005-0036-0828
Our Response:
We are finalizing, as proposed, requirements to conduct testing using gasoline containing
10 percent ethanol in order to ensure in-use emissions control and materials compatibility with
ethanol.
Spout Testing
What Commenters Said:
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DSD commented that 400 spout actuation cycles on a product in a short time period does
not represent real-world use. Many consumers will have their containers for at least 15 to 25
years. DSD further commented that the only way this would be adequate would be if EPA
required manufacturers to inscribe a date on which consumers would have to dispose of their
container and there was an obligation for consumers to destroy containers after 5 years. The
commenter noted that they personally have had gasoline containers last for more than 30 years.
They also commented that they have run their spout through an endurance test of 5,000 complete
cycles with gasoline, and that after dismantling the spout, they found no visual changes. Further,
they expect their spouts to live for over 250,000 complete cycles. DSD commented that if
consumers spend more money for a very good product, it will last 15 to 25 years without leakage
or evaporation, and it would be a win-win situation for consumers as well as the environment.
Letters:
DSD International Inc. OAR-2005-0036-0377
Our Response:
In response to DSD comments concerning spout durability testing, we understand that 5
years is an estimate of the typical life and that some containers will be used longer than 5 years,
as is indicated by the commenter's experience. However, we continue to believe that the
approach we are finalizing is reasonable. This provision is meant to help ensure that spouts are
made of quality materials so that the emissions performance will not deteriorate during normal
use. The provision also helps to ensure that spouts will not break easily or stick open during
normal use, and helps to identify these issues during the certification process prior to sale. We
believe the test will further encourage the use of robust designs, consistent with the use of "best
available control." In addition, this approach balances the need to ensure quality designs with
the manufacturers' need to be able to conduct certification testing in a reasonable amount of
time. This type of "accelerated aging" of components is a necessary part of many of EPA's
mobile source emissions control programs.
The 5-year time-frame is based on available data which indicates that 5 years is the
typical life of containers. We understand that spouts can be designed to function beyond the 5
year time frame. However, DSD indicates that their spouts have been tested to 5,000 actuations
and are expected to last 250,000 actuations. If used daily, which would be a high rate of use for
most residential applications, 5,000 actuations equates to 13.7 years of use and 250,000
actuations equates to 685 years of use. This is well beyond what we would consider to be
normal product usage and life cycles, based on available data. It is not the purpose of our
regulations to force manufacturers to design products that last longer than they last today in
typical use.
DSD suggests that in order for this testing to be adequate, we would need to require
consumers to discard their containers after 5 years. As discussed above, we disagree with the
assertion that the testing being required is inadequate. In addition, we do not have the authority
to require consumers to turn in products.
Third-party Testing
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What Commenters Said:
The PFCMA commented that it recommends that EPA develop these standards in
conjunction with an American Society of Testing and Materials (ASTM) standard. The use of an
ASTM standard will allow the manufacturers to use third party testing to ensure compliance with
the EPA regulations. Third party testing will provide consumers and retailers with an unbiased
evaluation of the products and an assurance of compliance with the regulation as well as product
safety and performance.
Letters:
Portable Fuel Container Manufacturers Association (PFCMA) OAR-2005-0036-0819
Our Response:
We are willing to work with PFCMA on incorporating the new test procedures into an
ASTM standard if it helps with third party testing or product acceptance. In order to be certified,
however, the test procedures and program requirements contained in EPA's final rule must be
followed regardless of who conducts the testing, and results must demonstrate compliance with
the new emissions standard.
5.4 Spout Requirements/Spillage Control
5.4.1 Spout Requirements
What Commenters Said:
DSD commented that it believes that too many errors were made in 1999 by California in
establishing requirements for new spouts. DSD noted that if you try the end valve spout models,
all of them will splash in many cases. DSD commented that some spout models can be damaged
easily, and provided the following example: 0-rings can be damaged during normal usage
resulting of leakage and evaporation; this can create child death by inhalation, explosion, fire etc.
DSD commented that all states that followed California's legislations did so by necessity, not
because the legislation was sound (did so only because they did not have the budget, personnel
and capacities to do otherwise).
DSD commented that it is also not convinced that the new California law removing fill
height, flow rate, and spill proof spout requirements, and allowing a second opening will result in
better spouts. DSD asks "What type of spout will be accepted?" and comments that if fuel flow
is too slow, consumers will remove spouts and pour fuel with no spout, or with funnels.
DSD commented that its company has developed a spout they call the angled tip spill
proof spout, with the following features:
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- Angled tip: the small angled tip guides the flow preventing splash and allows users to
see liquid level in the refilling tank preventing over flow (users can easily reduce flow
and stop manually).
- Spill proof spout: works well and will stop flowing on over 95% of applications.
- Child resistant features: prevention of accidental spillage, inhalation, explosion and fire
(causing death).
DSD noted that it guarantees the angled tip spill-proof spout that it will reduce overfill by
more than 95 % and evaporation by close to 100%. The commenter also noted that its spout
always functioned well for over 6.5 years in testing and in the field.
DSD also commented that spouts must fit on every application, or the manufacturer must
clearly indicate on what applications the spout can be used, and an evaluation must be made by
EPA to prevent the possibility of incorrect usage. Spouts designed for CARS's original program
did not work on many applications. All containers and spouts must fit on engine motor tanks
without using funnels, because funnels can easily create overflows. DSD commented that it has
developed the spout after establishing a complete study on fuel tank geometries. The commenter
did not rely on the inappropriate CARB test fixtures. DSD noted that the CD contains (which
was submitted with their public comments) many pictures and drawings of different gasoline
tank necks on many different types of machinery. (The CD to which the commenter refers, is
docket number OAR-2005-0036-0383, and is available at the EPA Docket Center in Washington,
DC.)
Letters:
DSD International Inc, OAR-2005-0036-0377
Our Response:
DSD comments noted several issues with spouts designed to meet the original California
program. We understand that several spouts designed to meet these requirements did not work
well in-use. Even when used properly, they resulted in increased spillage and consumer
complaints. As noted by DSD, some also had problems with o-ring failures and spout breakage.
In response to these issues, CARB redesigned their program. The spillage issues were the result
of design requirements for spill-proof spouts. Manufacturers were limited in the spout designs,
resulting in spout designs that did not work well with many types of equipment. CARB removed
these design requirements for spouts. This will allow manufacturers to design spouts that work
well in-use. In addition, CARB's original program did not require any certification or durability
demonstrations, which led to materials issues and spout breakage. CARB has addressed these
issues by requiring certification and durability demonstrations.
We have taken a very similar approach to CARB's new program. We have not included
any design-based requirements that would interfere with product designs, so manufacturers will
be able to design spouts that work well. We are also requiring up-front certification prior to the
sale of products. In addition, we are requiring durability testing to "age" components prior to
testing. This includes exposing components to fuel and durability testing for spouts. These
durability tests will provide incentive for robust designs in addition to helping to identify design
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issues. We have included requirements for a one-year warranty period for consumers so that
defective containers can be returned. Finally, we can track warranty claims and in-use
performance over the useful life of containers and consider these factors in the future
certification of products. This type of program design (i.e., durability demonstration, testing,
certification, warranty requirements, and in-use requirements) has been successfully
implemented for several mobile source sectors including light-duty vehicles and nonroad
equipment. Also, we also believe that the marketplace will provide manufacturers with
significant incentive to design products that work well and are durable.
DSD commented that their spout design relies in some cases on providing consumers
with a line of sight so they can stop the flow of fuel before overfill occurs. They provided
comment that their spout works very well on a variety of equipment types to prevent spillage and
that they have not received consumer complaints on their spout design. We concur that line-of-
sight is an important feature of spout design which was not available with some of the spouts
designed to meet CARB automatic shut-off requirements. Some spouts designed to meet
CARS's automatic shut-off requirements prevented a clear view into the fuel tank. This led to
spillage in cases where the automatic shut-off failed and consumers could not see into the tank to
prevent spills. We are not including any automatic shut-off design requirements, consistent with
CARB's new program. Not having automatic shut-off requirements will allow container
manufacturers to design spouts with narrower tips, allowing consumers to view the fuel in the
receiving tank. We believe this is an important feature that, when combined with an
automatically closing spout mechanism, will reduce spillage. Consumers will be able to view the
fuel rising in the receiving tank and use the automatic closure to stop the flow of fuel to prevent
spillage. We also concur with DSD's comments that the new containers will improve safety by
reducing spills and remaining sealed when not in use.
DSD comments that they "are not convinced" that CARB's new program removing fill
height, flow rate, and spill-proof spout requirements, and allowing the possibility of adding a
second opening, will result in better spouts. They comment that if fuel flow is too slow,
consumers will remove spouts and spout fuel without the spouts, or with funnels. For all the
reasons noted in the previous paragraphs, we believe that it is appropriate to provide flexibility to
manufacturers in designing their spouts and containers so long as emissions standards are met.
Manufacturers will need to use automatic closure mechanisms to seal containers in order to meet
the new emissions standards. We believe it is appropriate to allow manufacturers flexibility in
their spout designs in order for them to optimize the performance and consumer acceptability of
their products. Also, this approach allows for novel designs and future improvements which
could be prohibited if we were to include design requirements.
5.4.2 Spillage Control
What Commenters Said:
NESCAUM asked that EPA evaluate regulations for controlling spillage from portable
containers. Anchorage commented that the use of gasoline containers for fueling equipment, and
householder reports of spillage during this fueling, were factors associated with higher in-home
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benzene levels in studies performed in Anchorage. They also commented that they support
research to develop design standards for cans which minimize spillage.
Letters:
NESCAUM OAR-2005-0036-0993
Municipality of Anchorage, Department of Health and Human Services (Anchorage) OAR-
2005-0036-0976
Our Response:
We believe that the new automatically closing spouts will help reduce spillage because
they provide consumers with more control when using the containers to refuel equipment. By
not placing design requirements on manufacturers, manufacturers will have flexibility to design
products with good line-of-sight, so consumers can see the fuel in the tank and can stop the flow
of fuel using the automatic closure before overflow occurs. Also, with no design requirements,
manufacturers will be able to design spouts that work on a wide array of equipment and vehicles.
This is consistent with CARS's findings and approach. We currently do not know of a feasible
way to require automatic shut-off that would work well on all types of equipment, due to the
large variation in equipment fuel tank geometries. We believe that it is not appropriate to require
automatic shut-off as part of certification when we know there will be some cases in the field
where it will not work. We believe this would lead to confusion and consumer dissatisfaction, as
it did in California. If new technology is developed making automatic shut-off feasible, and
spillage remains a concern even with the new automatically closing containers, we could
consider revising the requirements for PFCs.
5.4.3 Other
What Commenters Said:
DSD commented they believe that if good instructions are not provided for users, it will
complicate usage of the product. DSD commented that procedures must be established and EPA
must evaluate instructions in a way to protect the consumers. Evaluations must be made by
educated personnel as per manufacturer instructions to prevent wrong interpretations.
Letters:
DSD International Inc. OAR-2005-0036-0377
Our Response:
We are requiring manufacturers to provide instructions to consumers with the new PFCs.
Manufacturers must provide these instructions to EPA for review as part of the certification
process, which must be completed prior to introduction into commerce. It is also in the best
interest of the manufacturers to provide clear instructions in order to help maintain consumer
satisfaction and minimize product returns.
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5.5 Emission Reduction Estimates
What Commenters Said:
The WDNR questioned how ethanol-based fuels would affect estimates of emission
reductions (e.g., ethanol-based fuels may have higher Reid vapor pressures).
The New Jersey Department of Environmental Protection (NJ DEP) noted that CARB's
research and calculations show that the emission reductions are greater than the 61 percent
estimated for the proposed rule.
Letters:
New Jersey Department of Environmental Protection, Division of Air Quality (NJ DEP) OAR-
2005-0036-0829
Wisconsin Department of Natural Resources, Bureau of Air (WDNR) OAR-2005-0036-
0828
Our Response:
We have adjusted our emissions inventory estimates for PFCs to account for ethanol in
the fuel (see section 2.1 of the RIA). These adjustments are based on our estimate of how much
E10 (90% gasoline, 10% ethanol mixture) will be used across the country in the future in
response to EPA's new Renewable Fuels Standards. As proposed, we are also requiring
containers to be tested with E10 fuel in order to ensure that container materials are compatible
with E10 and emissions performance is maintained.
In response to NJ DEP's comment about our estimated 61% overall HC reduction, our
nationwide emissions reduction estimates include several states that already have adopted
emissions controls for PFCs. This results in national percentage reduction estimates that are
lower than for states with no existing program. We estimate the overall HC reduction in states
that do not have emissions control programs is about 73 percent. In addition, our inventories
include factors that are not affected by the new controls, such as vapor displacement and spillage
when the container is refilled at the pump. For factors that are reduced by the new standards,
including evaporation, permeation and spillage, we estimate the HC reductions to be about 85
percent in states with no program.
5.6 Other
What Commenters Said:
DSD recommended educating the public on suggested motor manufacturer gas tank
filling levels to prevent fuel evaporation.
DSD also commented that the new containers could be used to protect the environment
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from many other liquids such as insecticides, chemicals, chlorine, etc.
Letters:
DSD International Inc. OAR-2005-0036-0377
Our Response:
DSD is concerned about evaporation from equipment fuel tanks in cases where the tank is
overfilled (but not to the point of overflowing and spilling). It is our understanding that
engine/equipment manufacturers currently provide consumers with refueling instructions
including recommended maximum fill level in the owner's manual.
We understand and appreciate that the container technology could be used for other
liquids to reduce unintended releases. This rule is focused on reducing VOCs and we included
PFCs due to their close relationship to mobile sources and their significant contribution to VOCs
and VOC-based toxics emissions. We did not analyze or otherwise consider any other uses for
the container technology (nor is it clear that section 183 authority would reach some of these
applications, since section 183 directs VOC control as a means of reducing emissions of ozone
precursors). Therefore, any other uses of the technology would need to be considered as part of
a future rulemaking focused on the particular pollutant of concern.
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6. COST-BENEFIT ANALYSIS
What We Proposed:
The comments in this chapter correspond to Section IX of the NPRM, and
therefore are targeted at the cost-benefit analysis. A summary of the comments received,
as well as our response to those comments, are located below. For the full text of
comments summarized here, please refer to the public record for this rulemaking.
6.1 Predicted Health Benefits of the Rule
What Commenters Said:
The commenters stated that they believe that EPA does not justify the benefit of
each programs contained in MSAT2 separately; instead, they claimed the three programs
are combined to assess costs and benefits. The commenters stated that this approach
makes it difficult to assess the individual contribution of each program under the MSAT2
proposal. If evaluated independently, the commenters stated, the fuels program is likely
to provide the lowest potential incremental benefit, yet most costly element of the
proposed rule.
The commenters also noted that the quantified economic benefits used by EPA to
justify the MSAT2 Proposal are based entirely on reduction of tailpipe emissions of
particulate matter. They stated that they believe it is not appropriate to use benefits from
one part of one regulatory initiative, namely, the Cold Temperature Vehicle Standard, to
justify what essentially constitutes two other separate regulatory initiatives, new limits on
benzene content in gasoline and a hydrocarbon emission standard for gas cans.
The commenters stated that they believe EPA's cost/benefit analysis completely
fails to monetize the benefits of its gasoline benzene reduction proposal, focusing instead
on the particulate matter (PM) related benefits associated with its proposed cold
temperature vehicle standards. Hence, the commenters believe that EPA has not justified
the need for its proposed reduction in benzene content of gasoline to 0.62 vol% on a
cost/benefit basis.
Letters:
American Petroleum Institute (API) OAR-2005-0036-0884
ExxonMobil Refining & Supply Company OAR-2005-0036-0772, -1013
Marathon Petroleum Company OAR-2005-0036-0946, -1008
Our Response:
We found, and continue to find, that each of the three major aspects of the rule are
separately justifiable under either Clean Air Act section 202(1) or (for portable fuel
containers) section 183(e). Furthermore, standards under sections 202(1) and 183(e) are
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not established or justified on a cost-benefit basis, and we did not justify any of the rule's
programs on that basis.
The statement that the programs are combined to assess costs and benefits is
incorrect. We present the emission reductions associated with each of the three programs
in this rule. Likewise, we have separately characterized the costs of each program. EPA
does not combine the benefits of each of the rule provisions. Chapter 12 of the
Regulatory Impact Analysis (RIA) presents only the PM-related benefits associated with
emission reductions attributed to the cold temperature vehicle standards. Benefits for all
other rule provisions are described qualitatively due to analytical constraints and
limitations discussed in the RIA. We do, however, present a comparison between the
benefits of the cold temperature vehicle standards versus the costs of that program, as
well as a comparison of the benefits of the cold temperature standards versus costs across
all programs.
What Commenters Said:
Both API and ExxonMobil commented that they believe the quantified benefits of
reducing particulate matter are based on a series of highly uncertain and questionable
scientific assumptions and represent extreme overestimates. These include use of overly
conservative and inaccurate concentration response functions (CRFs) for mortality and
morbidity health endpoints, and monetizing health endpoints for which a causal
relationship has not been established. Specifically, the commenters believe: 1) a lower
CRF should be used to assess the critical endpoint of chronic mortality; 2) infant
mortality should be removed from the cost-benefit analysis (CBA) since causality has not
been established; and 3) the morbidity endpoints of bronchitis and restricted activity days
cannot be clearly linked to exposure to fine PM nor quantified with any degree of
accuracy and should also be removed from the CBA. Our scientific concerns with the
EPA benefits assessment regarding particulate matter are further detailed below.
Letters:
American Petroleum Institute OAR-2005-0036-0884
ExxonMobil Refining & Supply Company OAR-2005-0036-0772, -1013
Our Response:
We rely on the published scientific literature to ascertain the relationship between
PM and adverse human health effects. We evaluate the epidemiological studies using a
well-established set of selection criteria. These criteria include consideration of whether
the study was peer-reviewed, the match between the pollutant studies and the pollutant of
interest, the study design and location, and characteristics of the study population, among
other considerations. The selection of concentration-response functions for all of EPA's
benefits analyses is guided by the goal of achieving comprehensiveness and scientific
defensibility.
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In addition to the above selection criteria, EPA relies on the guidance provided by
internal and external review panels, comprised of distinguished scientists, engineers, and
economists who are recognized, non-governmental experts in their respective fields.
EPA consults with the Science Advisory Board's Health Effects Subcommittee (SAB-
HES) and Clean Air Science Advisory Committee (CASAC) in the development and
improvement of methods we use to estimate and value the potential reductions in health
effects associated with air quality improvements. All of EPA's regulatory analyses also
are reviewed extensively by the Office of Management and Budget (OMB). EPA also
looks to recommendations provided by panels such as those convened by the National
Academy of Sciences (NAS) to specifically address facets of our cost and benefits
analyses.
In regard to PM-related adult mortality, the SAB-HES panel recommended using
long-term prospective cohort studies in estimating mortality risk reduction.38 This
recommendation has been confirmed by a recent report from the National Research
Council (NRC), which stated that "it is essential to use the cohort studies in benefits
analysis to capture all important effects from air pollution exposure" (NRC, 2002, p.
108).39 More specifically, the SAB recommended emphasis on the American Cancer
Society (ACS) study because it includes a much larger sample size and longer exposure
interval and covers more locations (e.g., 50 cities compared to the Six-Cities Study) than
other studies of its kind. Because of the refinements in the extended follow-up analysis,
the SAB-HES recommends using the Pope et al. (2002) study40 as the basis for the
primary mortality estimate for adults and suggests that alternate estimates of mortality
generated using other cohort and time-series studies could be included as part of the
sensitivity analysis (U.S. EPA-SAB, 2004b).41
The SAB-HES also recommended using the specific estimated relative risks from
the Pope et al. (2002) study based on the average exposure to PM2.5, measured by the
average of two PM2.5 measurements, over the periods 1979-1983 and 1999-2000. In
addition to relative risks for all-cause mortality, the Pope et al. (2002) study provides
relative risks for cardiopulmonary, lung cancer, and all-other cause mortality. Because of
concerns regarding the statistical reliability of the all-other cause mortality relative risk
estimates, we calculated mortality impacts for the primary analysis based on the all-cause
relative risk. Based on our most recently available SAB guidance, we provide mortality
impacts based on the ACS study as the best estimate for comparing across the current and
previous RIAs.
The NRC (2002) also recommended that EPA use formally elicited expert
judgments as a means of characterizing uncertainty in the concentration-response
relationship between PM2.5 exposures and mortality. EPA therefore convened a panel of
experts to elicit probabilistic distributions describing uncertainty in estimates of the
reduction in mortality among the adult U.S. population resulting from reduction in
ambient annual average PM2.5 levels. The results of this study, completed in 2006
(Industrial Economics, 2006),42 found that the majority of expert opinion (11 out of 12
experts) believed that the PM2.5-mortality effect was stronger than a comparable result
derived from the Pope et al. (2002) ACS study. This leads the Agency to expect that our
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estimates of mortality derived from the ACS study understate the benefits associated with
the final cold temperature vehicle standard.
Regarding infant mortality, recently published studies have strengthened the case
for an association between PM exposure and respiratory inflammation and infection
leading to premature mortality in children under 5 years of age. Specifically, the SAB-
HES noted the release of the WHO Global Burden of Disease Study focusing on ambient
air, which cites several recently published time-series studies relating daily PM exposure
to mortality in children. 43 The SAB-HES also cites the study by Belanger et al. (2003)44
as corroborating findings linking PM exposure to increased respiratory inflammation and
infections in children. Recently, a study by Chay and Greenstone (2003)45 found that
reductions in TSP caused by the recession of 1981-1982 were related to reductions in
infant mortality at the county level. With regard to the cohort study conducted by
Woodruff et al. (1997),46 the SAB-HES notes several strengths of the study, including the
use of a larger cohort drawn from a large number of metropolitan areas and efforts to
control for a variety of individual risk factors in infants (e.g., maternal educational level,
maternal ethnicity, parental marital status, and maternal smoking status). Based on these
findings, the SAB-HES recommends that EPA incorporate infant mortality into the
primary benefits estimate and that infant mortality be evaluated using an impact function
developed from the Woodruff et al. (1997) study. 47 A more recent study by Woodruff et
al. (2006)48 continues to find associations between PM2.5 and infant mortality. The study
also found the most significant relationships with respiratory-related causes of death. We
have not yet sought comment from the SAB on this more recent study and as such
continue to rely on the earlier 1997 analysis.
EPA disagrees with the statement that "the morbidity endpoints of bronchitis and
restricted activity days cannot be clearly linked to exposure to fine PM nor quantified
with any degree of accuracy and should also be removed from the CBA." Regarding
chronic bronchitis, Abbey et al. (1995)49 examined the relationship between estimated
PM2.5 (annual mean from 1966 to 1977), PMio (annual mean from 1973 to 1977) and TSP
(annual mean from 1973 to 1977) and the same chronic respiratory symptoms in a sample
population of 1,868 Californian Seventh Day Adventists. The initial survey was
conducted in 1977 and the final survey in 1987. To ensure a better estimate of exposure,
the study participants had to have been living in the same area for an extended period of
time. In single-pollutant models, there was a statistically significant PM2.5 relationship
with development of chronic bronchitis, but not for airway obstructive disease (AOD) or
asthma; PMio was significantly associated with chronic bronchitis and AOD; and total
suspended particulates (TSP) was significantly associated with all cases of all three
chronic symptoms. Other pollutants were not examined. Because the cold temperature
vehicle standards control direct PM2.5, this analysis uses only the Abbey et al. (1995) C-R
function based on the results of the PM2.5 single pollutant model.
Ostro and Rothschild (1989)50 estimated the impact of PM2 5 and ozone on the
incidence of minor restricted activity days (MRADs) and respiratory-related restricted
activity days (RRADs) in a national sample of the adult working population, ages 18 to
65, living in metropolitan areas. The annual national survey results used in this analysis
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were conducted in 1976-1981. Controlling for ozone, two-week average PM2.5 was
significantly linked to both health endpoints in most years. The C-R function for PM is
based on this co-pollutant model. The study is based on a "convenience" sample of non-
elderly individuals. Applying the C-R function to this age group is likely a slight
underestimate, as it seems likely that elderly are at least as susceptible to PM as
individuals under 65. The elderly appear more likely to die due to PM exposure than
other age groups (e.g., Schwartz, 1994, p. 30)51 and a number of studies have found that
hospital admissions for the elderly are related to PM exposures (e.g., Schwartz, 1994;
Schwartz, 1994).52'53
The Agency would also like to point out that MRADs and other morbidity
endpoints have been a standard part of recent, peer-reviewed benefits assessments. These
include Ostro et al. (2006),54 Levy et al. (2003),55 Cifuentes et al. (2001),56 Levy et al.,
(2001)57 and Hubbell et al., (2005).58
What Commenters Said:
Both API and ExxonMobil noted that, for the fuels program separately, EPA
states it cannot quantify benefits since the NATA assessments do not take full account of
the exposure ranges of the population. The commenters stated that EPA instead listed
"unquantified" and nonmonetized effects. The commenters noted that these effects are
categorized as "ozone health", "ozone welfare", "PM health", "PM welfare", "MSAT
Health", and "MSAT welfare" (Table IX.E1, page 15908). The commenters believe that
the only benefits from this list that are applicable to the fuels program are "MSAT
Health". The commenters also noted that under "MSAT Health", EPA listed the
following as applicable to benzene: cancer, anemia, disruption of production of blood
components, reduction in the number of blood platelets, excessive bone marrow
formation, and depression of lymphocyte counts. The commenters stated that it appears
that EPA simply listed all outcomes that have ever been associated with benzene,
regardless of whether they could possibly occur at ambient levels. Lastly, the
commenters stated that EPA's own reference concentration (RfC) of 30 |ig/m3 is in fact
regarded as the safe level to protect against all noncancer health effects. The commenters
believe that since this level is above present day ambient concentrations, noncancer effect
should be referenced in this table.
Letters:
American Petroleum Institute (API) OAR-2005-0036-0884
ExxonMobil Refining & Supply Company OAR-2005-0036-0772, -1013
Our Response:
As discussed in Chapter 3 of the RIA, there are numerous observations of
personal exposure and indoor air concentrations of benzene in excess of the RfC. Also,
as discussed in the RIA for the proposal, estimated average population cancer risks from
inhalation exposure to benzene are likely to be substantial underestimates. In addition to
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the potential for the current unit risk range to be a substantial underestimate, inventories
used in risk modeling for the proposal did not include elevated cold start emissions for
gasoline vehicles or portable fuel container emissions. Moreover, the exposure modeling
did not adequately capture near road impacts on risk, or impacts of emissions in attached
garages to exposure and risk. Modeling done for the final rule did account for the
additional sources of exposure described above.
What Commenters Said:
The commenters stated that ambient levels of sulfur dioxide in the U.S. are much
lower today than those present when the ACS study was conducted. The commenters
further stated that clinical and toxicology studies clearly demonstrate that sulfur dioxide
(802) enhances the toxicity of PM, particulate matter (Costa, 2001). The commenters
believe this supports the concept that CRFs reported by Pope et al. and used by EPA in
the benefits analysis for particulate matter should be adjusted downward to account for
the reduced impact of 862 between past and current conditions.
The commenters believe that whether ambient exposure to SO2 produces an independent
risk for mortality, as suggested by Krewski et al., acts as a surrogate for other pollutants
in the air pollution mix (as suggested by some authors) or actually increases the risk of
PM (as suggested by clinical and toxicology studies) is arguable. The commenters state
that since SC>2 increases the toxicity of particulate matter, use of the 6% value - without
adjustment - does not provide an accurate estimate of PM risk.
For the critical health effect of chronic PM mortality, the commenters stated tht
they believe the authors of the CBA used an overly conservative, scientifically invalid
and inflated value of 6% change in mortality per 10 |ig/m3 of PM2.5, as derived from the
ACS Study as reported by Pope et al. (2002). The commenters stated that they believe
the results of the thorough reanalysis of this study by Krewski et al. (2000, 2003) clearly
demonstrate effect modification by education and other factors such as temperature
variation and population change, attenuation of particle effect when spatial correlation
was considered, and most importantly, strong attenuation of the particle effect when
sulfur dioxide was simultaneously considered in the model. The commenters therefore
suggested using a coefficient of 1% rather than 6%, based on data by Krewski et al.
which they believe provides a more complete adjustment for the effects of 862.
Letters:
American Petroleum Institute (API) OAR-2005-0036-0884
ExxonMobil Refining & Supply Company OAR-2005-0036-0772, -1013
Alliance of Automobile Manufacturers OAR-2005-0036-0881
Our Response:
We agree with the need to address co-pollutants when employing epidemiologic
models. The Health Effects Institute (HEI) reanalyses generally confirmed the original
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investigators' findings of associations between mortality and long-term exposure to PM,
while recognizing that increased mortality may be attributable to more than one ambient
air pollution component. Regarding the validity of the published ACS Studies, the HEI
Reanalysis Report concluded that overall, the reanalyses assured the quality of the
original data, replicated the original results, and tested those results against alternative
risk models and analytic approaches without substantively altering the original findings
of an association between indicators of particulate matter air pollution and mortality.
The most recent external review draft of the PM criteria document reaches similar
conclusions.
While the Agency recognizes the ongoing need to research the issue of
copollutants, including 862, and their role in quantifying the relationship between long-
term exposure to PM2.5 and mortality, we disagree with the commenter's interpretation
of the HEI reanalysis and their assertion that we are using an overly conservative,
scientifically invalid and inflated coefficient. Although the HEI reanalysis did find a
robust association between mortality and 862, such an association was also reported for
fine particles and sulfate. In addition, the study points out that efforts to address spatial
autocorrelation for ecologic-scale variables such as fine particles and sulfate may have
over-adjusted estimated effects for these regional pollutants compared with effect
estimates generated for local copollutants including 862. This could partially account for
the higher effect estimate generated for SC>2 relative to fine particles and for sulfate. In
addition, SC>2 is associated with sulfate formation and consequently, SC>2 concentrations
are likely surrogates for sulfate concentrations, which could explain their statistical
association with PM2.5-related mortality.
In considering this issue of SC>2 as a copollutant and its impact on the association
between mortality and long-term exposure to PM2.5, it is also important to consider the
wider literature. Two recent studies examining the relationship between gaseous
copollutants (including 802) and PM-related health effects including mortality (Samet et
al., 2000),59 conclude that SC>2 is likely to represent a surrogate for ambient PM2.5
concentrations and may in certain circumstances represent a surrogate for personal
exposure to PM2.5. Furthermore, both studies conclude that 862 is unlikely to be a
confounder for PM2.5-related health effects (i.e., it is unlikely to be associated directly
with these health effects while being correlated with PM2.5 exposure). Further evidence
against 862 as a confounder specifically for mortality effects involves biological
plausibility. While 862 is recognized as effecting airways causing difficulty in breathing,
especially for asthmatics, there is little evidence of a causal link between SC>2 exposure
and cardiovascular- or lung cancer-related mortality. This argues against SC>2 as a
confounder for PM2.5-related mortality effects.
Following recommendations from the National Academy of Sciences and SAB-
HES, we have continued to update our methods for benefits estimation to reflect the latest
research and are now using the Pope et al, (2002) reanalysis of the ACS study data. This
latest reanalysis has a number of advantages over prior studies in evaluating the role of
SC>2 in the relationship between PM2.5 exposure and mortality. The ACS reanalysis
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includes 8 additional years of follow up data, including data on fine particulates and
gaseous copollutant exposure. The ACS reanalysis also considers a variety of additional
covariates believed to be associated with mortality and uses the latest statistical methods
(e.g., non-parametric spatial smoothing) for addressing key issues such as spatial
autocorrelation. While the ACS reanalysis continues to show a strong correlation
between SC>2 and all cause and cardio-vascular mortality, suggesting that it is likely a
surrogate for particulate fine and more likely sulfate exposure, the study also provides the
strongest evidence yet for an association between long-term exposure to PM2.5 and
mortality.
The NRC (2002) also recommended that EPA use formally elicited expert
judgments as a means of characterizing uncertainty in the concentration-response
relationship between PM2.5 exposures and mortality. EPA therefore convened a panel of
experts to elicit probabilistic distributions describing uncertainty in estimates of the
reduction in mortality among the adult U.S. population resulting from reduction in
ambient annual average PM2.5 levels. The results of this study, completed in 2006
(Industrial Economics, 2006),60 found that the majority of expert opinion (11 out of 12
experts) believed that the PM2.5-mortality effect was stronger than a comparable result
derived from the Pope et al. (2002) ACS study. This leads the Agency to expect that our
estimates of mortality derived from the ACS study understate the benefits associated with
the final cold temperature vehicle standard.
What Commenters Said:
Commenters stated that they believe that EPA's continued use of the Value of a
Statistical Life (VSL) approach, with a cost of $6 million per hypothesized mortality
event, markedly inflates the benefits in this proposal. They suggested that EPA consider
the more scientifically valid approach based on life years lost.
Letters:
American Petroleum Institute (API) OAR-2005-0036-0884
ExxonMobil Refining & Supply Company OAR-2005-0036-0772, -1013
Our Response:
EPA agrees that there is a large amount of uncertainty in the VSL for application
to environmental policy analysis. However, as noted in the RIA, the SAB Environmental
Economics Advisory Committee has advised that the EPA "continue to use a wage-risk-
based VSL as its primary estimate, including appropriate sensitivity analyses to reflect
the uncertainty of these estimates," and that "the only risk characteristic for which
adjustments to the VSL can be made is the timing of the risk"(EPA-SAB-EEAC-00-
013).61 In response to concerns about the range of estimates included in the VSL
distribution, we have modified the value of life distribution. The mean value of avoiding
one statistical death is now assumed to be $5.5 million in 1999 dollars. This represents a
central value consistent with the range of values suggested by recent meta-analyses of the
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wage-risk VSL literature. The distribution of VSL is characterized by a confidence
interval from $1 to $10 million, based on two meta-analyses of the wage-risk VSL
literature. The $1 million lower confidence limit represents the lower end of the
£*r)
interquartile range from the Mrozek and Taylor (2000) meta-analysis. The $10 million
upper confidence limit represents the upper end of the interquartile range from the
Viscusi and Aldy (2003) meta-analysis.63 The mean estimate of $5.5 million is
consistent with the mean VSL of $5.4 million estimated in the Kochi et al. (2006) meta-
analysis.64
In developing our estimate of the benefits of premature mortality reductions, we
have discounted over the lag period between exposure and premature mortality.
However, in accordance with the SAB advice, we use the VSL in our primary estimate.
Consistent with the SAB advice and in accordance with the provisions contained in the
FY04 Appropriations bill, we do not adjust the VSL to reflect any differences across age
groups.
What Commenters Said:
API and ExxonMobil commented that they have concerns regarding EPA's
evaluation of bronchitis as a health endpoint. First, contribution of particulate matter to
the incidence of bronchitis is entirely attributed to fine particle exposure, which is
scientifically incorrect. They commented that this invalid attribution contrasts with the
etiology of bronchitis, and highlights the need for clinical input to the EPA CBA. The
commenters noted that bronchitis is primarily a disease of the upper respiratory tract; and
coarse particles, which deposit in the upper respiratory tract, are much more likely to
contribute to the etiology of this disease. The commenters stated that fine particles
deposit primarily in the lower respiratory tract, and are not expected to significantly
contribute to the incidence of bronchitis. The commenters stated that they believe it is
biologically inappropriate to convert the morbidity function from a study using coarse
PM10 to fine PM2.5; rather, for bronchitis, a separate benefits analysis for PM10 or other
coarse-particle metric - such as total PM2.5, 10 or TSP - should be provided. The
commenters noted that in the study by Abbey et al. (1995a,b), a stronger relationship was
observed for TSP - the actual metric of particle exposure used - than for either PM10 or
PM2.5.
The commenters also commented that they are concerned that concentration
response functions used were incorrectly applied to the air pollutant under consideration.
Since monitoring both PM10 and PM2.5 was very limited in California before 1986,
Abbey et al. (1995a,b) used data for TSP to estimate PM10, and airport visibility records
to derive an estimate for PM2.5. The commenters stated that they believe this approach
is awkward for estimating exposures, and seriously jeopardized the findings from this
study.
The commenters further commented that they are concerned that the assessment
of bronchitis is based on a single study (Abbey et al., 1995a,b), for which the result was
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not statistically significant - even at the 5% level. They do not believe that causality can
be established based on the results of a single ecological epidemiology study. Further,
they questioned the accuracy of a concentration response function based on a single study
result. In particular, they stated that they are concerned with the accuracy of the
adjustment for smoking in this study, which they believe is a major contributor to the
incidence of bronchitis. The commenters stated that they believe the magnitude of
calculated risk due to PM air pollution, which is essentially the same as the background
rate attributed to all other factors, raises more suspicion and illustrates the need for reality
checks. Finally, the commenters stated that EPA's development of a concentration
response function based on findings from a single study (here, results that were not
statistically significant at the 5% level) begs the question as to whether are sufficiently
robust data set to conclude in a CB A.
The commenter also questioned the adjustment of a concentration-response
function for PM10 to one based on PM2.5 based on the simple mean ratio of these
particles in urban air. The commenter stated that the authors offer no biological
explanation as to why such as an adjustment is appropriate, or why fine PM would be
expected to exhibit the same potency as coarse particles. The commenter noted that fine
and coarse particles distribute differentially in the respiratory tract and produce a
different and separate spectrum of health effects; and certain respiratory symptoms would
be expected to be exacerbated more by exposure to coarse rather than fine PM, a finding
consistent with the actual study, where stronger associations were observed for TSP than
for PM10 or PM2.5 surrogates. The commenters stated that it is unclear why the authors
of the CBA choose to attribute all RAD related effects to fine PM.
The commenters stated that they are concerned with the use of data from
California during the period of 1966-1988 when air pollution was high, likely resulting in
an inflated CRF. The commenters stated that the air pollution data that are the basis of
the study used for the CBA are from 1966-1987—close to 30 years old. The commenters
questioned if concentration response functions based on results using this air pollution
data are robust enough to use in a CBA designed to project results nearly 20 years into
the future. The commenters further stated that California data are dominated by
photochemical smog, but this concentration response function overestimates effects of
low levels of PM alone. The commenters also stated that whether or not a threshold
exists for this endpoint, and whether or not the concentration response function is specific
to paniculate matter, photochemical pollution, other gases present in ambient air, or a
combination of these, has not been evaluated.
The commenters stated that they are likewise concerned that assessment of
Restricted Activity Days (RADs) and Minor Restricted Activity Days (MRADs)
endpoints are solely based on the results of the Health Interview Study, as reported by
Ostro (1987) and Ostro & Rothchild (1989). They noted that the concentration-response
functions derived from this study are based on air pollution data from 1976-1981, when
air pollution levels were significantly greater. The commenters also questioned the
exposure metrics used in this study, as PM10 and PM2.5 levels were not measured
(PM2.5 levels were estimated from visibility data from airports). The commenters
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further stated that there has been no assessment of whether RADs or MRADs would even
be triggered by lower air pollution levels—thus they believe that the issue of threshold
has not been explored at all for these morbidity endpoints.
The commenters stated that it believes that the health endpoints of RAD and
MRAD are highly subject to socioeconomic confounding. The commenters noted that
the in study used to derive the concentration response functions, significant city-to-city
differences in RAD rates were observed. The commenters believe that this was likely
due to socioeconomic factors and other factors that were not adequately controlled in the
selected study. The commenters also stated that they believe that many of the
socioeconomic factors that need to be controlled to identify the potential effect of air
pollution are likely much more important than air pollution itself in the production of
RADs and MRADS.
Letters:
American Petroleum Institute (API) OAR-2005-0036-0884
ExxonMobil Refining & Supply Company OAR-2005-0036-0772, -1013
Our Response:
EPA relies on the guidance provided by internal and external review panels
comprised of distinguished scientists, engineers, and economists who are recognized,
non-governmental experts in their respective fields. EPA consults with the Science
Advisory Board's Health Effects Subcommittee and Clean Air Science Advisory
Committee in the development and improvement of methods we use to estimate and
value the potential reductions in health effects associated with air quality improvements.
All of EPA's regulatory analyses also are reviewed extensively by the Office of
Management and Budget. EPA also looks to recommendations provided by panels such
as those convened by the National Academy of Sciences to specifically address facets of
our cost and benefits analyses. We point this out because chronic bronchitis and MRADs
have been included in every major air quality-related RIA for the last 10 years.
During that time, the Agency has received much internal and external review on
these, and other, morbidity endpoints. The Agency's desire to characterize a
comprehensive suite of health effects associated with its rules has been noted by both the
National Academy of Sciences (NRC, 2002)65 and the SAB-HES (EPA, 2004),66 despite
our reliance on an aging literature. Though weaknesses and uncertainties in the
epidemiological literature are acknowledged and described qualitatively in the RIA (see
Chapter 12), our decision to include these endpoints in our cost-benefit analyses continue
to be supported by Agency internal and external review.
Furthermore, the Agency's Staff Paper on the Parti culate Matter Air Quality
Criteria Document characterized the chronic bronchitis literature as follows,
For respiratory effects, notable new evidence from epidemiological studies
substantiates positive associations between ambient PM concentrations and not
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only respiratory mortality.. .Of much interest are emerging new findings
indicative of likely increased occurrence of chronic bronchitis in association with
(especially chronic) PM exposure. The biological pathways underlying such
effects can include inflammatory responses, increased airway responsiveness or
altered responses to infectious agents. Toxicological studies have provided
evidence that supports plausible biological pathways for respiratory effects of fine
particles.
Considered together, the CD finds that the long-term exposure studies on
respiratory morbidity reported positive and statistically associations between fine
particles or fine particle components and lung function decrements or chronic
respiratory diseases, such as chronic bronchitis (CD pp. 8-313, 8-314).67
The Agency would also like to point out that MRADs and other morbidity endpoints have
been a standard part of recent, peer-reviewed benefits assessments. These include Ostro
et al. (2006),68 Levy et al. (2003),69 Cifuentes et al. (2001),70 Levy et al., (2001)71 and
Hubbell et al., (2005).72
What Commenters Said:
API commented that the choice of using the benefit endpoints of 2020 and 2030
and the focus on PM are clear indicators that EPA largely used the air modeling work and
benefit analysis associated with the Nonroad Diesel Rule for the benefit analysis for the
MSAT 2 proposal. API noted that it also commented on the Nonroad Diesel Rule
proposal (68 FR 28328, May 23, 2003) that it believed that EPA's PM benefit estimates
associated with the Nonroad Diesel Rule were flawed. The commenter believes that
since EPA relied on that analysis to estimate PM related benefits associated with the
MSAT2 proposal, the estimated PM benefits associated with the MSAT2 proposal are
also flawed. API listed the following issues of concern related to the estimated PM
benefits: 1) the treatment of uncertainty in cost-benefit analysis; and 2) estimates of value
of statistical life.
Regarding the treatment of uncertainty in cost-benefit analysis, the commenter
stated that it believes that it was incomplete, flawed and highly misleading. The
commenter stated that EPA did not assume a threshold in the CR function for PM
mortality, but rather reflected a background threshold assumption of 3 micrograms per
cubic meter (DRIA, Ch.12, p. 1230). This, the commenter noted, despite EPA's most
recent PM2.5 Criteria Document that concludes that "the available evidence does not
either support or refute the existence of thresholds for the effects of PM on mortality
across the range of concentrations in the studies" (DRIA, Ch.12, p. 1229). The
commenter stated that not including the uncertainties surrounding the issue of threshold
values of the CR (PM mortality) function renders EPA's analysis of uncertainty to be of
little or no value.
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The commenter stated that it believes that another source of uncertainty is that
surrounding the EPA estimates of VSL. The commenter noted that EPA used a central
estimate of VSL of $6.6 million (2020 income level expressed in $2000) and $6.8 million
(2030 income level expressed in $2000); however, the commenter stated that these
estimates are based upon a range of values from various meta-analyses and may reflect
risk preferences significantly different from the target population.
The commenter stated that it endorses the use of the best available science
throughout the policy making process, and it believes that more research is needed in the
derivation of defensible base estimates for the value of a statistical life. The commenter
stated that estimates of VSL need to accurately reflect the risk preferences of the target
population; however, it does not believe that this was the case with the use of the
estimates used by EPA. The commenter noted concerns with the fact that the studies
from which the estimates are derived targeted the middle-aged working population and
not the most vulnerable population segments to air pollution—the elderly (in fragile
health) and the very young. The commenter also stated that the type of risk being valued,
typically job related risk, is very different from the risk associated with increased air
pollution. The commenter further stated that it believes that little, if any, confidence can
be placed in the appropriateness of the VSL estimates used by EPA in valuations of
reduced mortality due to decreases in PM concentrations. The commenter stated that this
is critical since VSL, along with the EPA estimate of the number of reduced mortalities
due to PM reduction (also highly flawed as explained above) are overwhelmingly the
predominant factors driving the benefit estimation in this RIA.
The commenter recommended that the EPA move to a comprehensive assessment
of uncertainty in its benefit-cost analyses so as to reflect the true uncertainty associated
with its net benefit estimates (the commenter suggested that EPA could use a Monte
Carlo analysis that captured the true extent of uncertainty associated with the health
impacts of PM2.5 concentrations in addition to the other major sources of uncertainty).
The commenter believes that the assessment of uncertainty in the proposal is disjointed
and conveys a misleading sense of certainty to its net benefit estimates, and only provides
limited value to policy deliberations. The commenter also stated that it believes that
EPA's unequivocal assertion that societal benefits vastly exceed societal costs in the rule
is not supportable given the problems and omissions associated with its benefit estimates
and uncertainty analysis.
Letters:
American Petroleum Institute (API) OAR-2005-0036-0884
Our Response:
We refer the reader to the Nonroad Diesel Rule response-to-comments document
for detail regarding the commenter's assertion that the Nonroad Diesel Rule's benefits
were flawed (http://epa.gov/nonroad-diesel/2004fr.htm#summary).
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Due to the analytical constraints associated with the benefits scaling approach,
which are explained in the RIA, we are unable to conduct an analysis of the impact of
alternative thresholds. We do, however, qualitatively indicate the uncertainty associated
with various PM2.5 cutpoints used in the calculation of PM-related mortality. We refer
the reader to Chapter 12 of the RIA for this discussion. We also provide a scaled
estimate of the Monte Carlo-based confidence interval associated with the benefits for
each endpoint and for the total benefits associated with the cold temperature vehicle
standards. As one can see, the statistical uncertainty associated with these estimates do
not "show a distribution of benefits so disperse as to make any definitive conclusions
regarding benefits and costs impossible." We acknowledge, however, that this range
does not capture all sources of uncertainly, such as the impact of different thresholds. Per
the recommendations of the National Research Council (2002), the Agency is moving
towards a comprehensive assessment of uncertainty in its benefit-cost analyses when
possible.
EPA agrees that there is a large amount of uncertainty in the VSL for application
to environmental policy analysis. However, the SAB Environmental Economics
Advisory Committee has advised that the EPA "continue to use a wage-risk-based VSL
as its primary estimate, including appropriate sensitivity analyses to reflect the
uncertainty of these estimates," and that "the only risk characteristic for which
adjustments to the VSL can be made is the timing of the risk"(EPA-SAB-EEAC-00-013).
In response to concerns about the range of estimates included in the VSL distribution, we
have modified the value of life distribution. The mean value of avoiding one statistical
death is now assumed to be $5.5 million in 1999 dollars. This represents a central value
consistent with the range of values suggested by recent meta-analyses of the wage-risk
VSL literature. The distribution of VSL is characterized by a confidence interval from $1
to $10 million, based on two meta-analyses of the wage-risk VSL literature. The $1
million lower confidence limit represents the lower end of the interquartile range from
the Mrozek and Taylor (2000) meta-analysis. The $10 million upper confidence limit
represents the upper end of the interquartile range from the Viscusi and Aldy (2003)
meta-analysis. The mean estimate of $5.5 million is consistent with the mean VSL of
$5.4 million estimated in the Kochi et al. (2006) meta-analysis. The modified VSL
distribution is reflected in the scaled benefits estimated for this analysis.
In developing our estimate of the benefits of premature mortality reductions, we
have discounted over the lag period between exposure and premature mortality.
However, in accordance with the SAB advice, we use the VSL in our primary estimate.
Consistent with the SAB advice and in accordance with the provisions contained in the
FY04 Appropriations bill, we do not adjust the VSL to reflect any differences across age
groups. The modified lag distribution is reflected in the scaled benefits estimated for this
analysis.
6.2 Predicted Social Costs of the Rule
What Commenters Said:
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API noted that EPA estimates costs of the fuels program to be $250 million annually in
total social welfare costs in 2030 (in 2003 $) (Table IX.E4, page 15912). API believes
this $250M social cost estimate is very likely to underestimate true social costs, since
EPA considered only the fuels program impact on residential users in their calculations.
The commenter goes on to state that the Agency focused only on impacts related to
personal transportation or residential lawn/garden care and recreational use. Additional
costs associated with complying with the proposed programs related to production of
goods and services that use gasoline fuel as production input were not considered. EPA
justifies their focus on only residential cost impacts based on 1) a Department of Energy
(DOE) and California Air Resources Board (CARB) study suggesting that the
commercial share of the end user market for gasoline is relatively small and 2) EPA's
assumption that the share of gasoline-related costs to total production costs is small (page
15913 of proposed rule). However, the commenter believes the true costs would
undoubtedly be much larger if these were taken into account. As such, a key question not
answered by EPA is whether the benefits of the fuel program alone exceed the estimated
$250M annual social cost of the fuels program.
Letters:
American Petroleum Institute (API) OAR-2005-0036-0884 (p. 19)
Our Response:
Our method for estimating the social costs of the program uses a partial equilibrium
model that examines the impacts on directly affected stakeholders (fuel providers and
users). We did not examine the impacts on application markets (goods and services
produced using gasoline fuel). This is because a price change of the magnitude
associated with the fuel requirements is very small and well within the normal gasoline
price fluctuations experienced by such commercial entities. In addition, gasoline fuel is
likely to be only a small part of the total production inputs used to produce those goods
and services. For example, the gasoline used in a delivery van is likely to be small part of
the operating costs of a delivery service company, with labor and other inputs
constituting the main production costs. Finally, the vast majority of consumers of
gasoline fuel are individual noncommercial users. This is supported by the information
cited in the question as well as DOE data that indicates that only about 6 percent of
gasoline fuel sold in the United States is used for commercial or industrial transportation.
For these reasons we believe that the impacts on the broader economy would be relatively
small and perhaps not large enough to disturb the results had a general equilibrium model
of the economy been designed and utilized in this analysis. Consequently, while there are
other non-quantified social costs in addition to the social costs estimated in the EIA, these
are not likely to be large.
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7. ADMINISTRATIVE AND PROCEDURAL REQUIREMENTS
What We Proposed:
The comments in this chapter deal with the administrative and procedural requirements
related to the proposed rule. A summary of the comments received, as well as our response to
those comments, are located below. For the full text of comments summarized here, please refer
to the public record for this rulemaking.
7.1 SBREFA Process/Regulatory Flexibility Act
What Commenters Said:
The Ad-Hoc Coalition of Small Business Refiners commented that it greatly appreciated
the opportunity to be involved during the Small Business Regulatory Enforcement Fairness Act
(SBREFA) Panel process as well as the efforts made by the members of the Federal Panel and
EPA staff to understand their special circumstances.
During the development of the final rule, representatives of the small refiners commented
that they believed that the imposing a 1.3 vol% refinery maximum average is a violation of the
Regulatory Flexibility Act (RFA), because the Panel did not have the opportunity to review the
impacts of such a cap on small businesses. The commenters (citing 5 U.S.C. § 609) stated that
they believe EPA would, at a minimum, need to present the maximum average provision to the
Panel for its consideration prior to including it as part of a final rule.
Letters:
Ad Hoc Coalition of Small Business Refiners OAR-2005-0036-0686
Our Response:
We appreciate the comments regarding the SBREFA process and agree that the Panel
process was quite effective and beneficial to all of the small entities that participated in the
SBREFA process. We have also provided small refiners continued opportunities to comment
throughout the rulemaking (i.e., following the end of the Panel process), both through the public
comment process and through direct meetings with agency personnel to discuss emerging issues
of concern. (Memoranda of these meetings are included as part of the administrative record for
this rule.)
Please see section 4.9.1.4 of this Summary and Analysis document for a greater
discussion of the comments, and our response, regarding the assertion that the 1.3 vol% refinery
maximum average was adopted without complying with the procedural requirements of the RFA.
7.2 Clean Air Act Requirements
7.2.1 Section 202(1)- Requirements for Mobile Source-Related Air Toxics
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7.2.1.1 General
What Commenters Said:
The New York State Department of Environmental Conservation, LRAPA, OR DEQ, NJ
DEP, Environmental Defense, Natural Resources Defense Council, U.S. PIRG, American Lung
Association, STAPPA and ALAPCO, IL EPA, and FL DEP all noted in their comments that
section 202(1) of the Clean Air Act (CAA) requires EPA to regulate hazardous air pollutants
from motor vehicle fuels to the "greatest degree of emissions reduction achievable." The
commenters all stated that they believe that the proposed annual average benzene standard of
0.62 vol% (along with an ABT program) does not go far enough in reducing fuel benzene levels
to meet the CAA mandate. The commenters stated that proven technology is commercially
available to reduce benzene content substantially lower than what was proposed.
The Puget Sound Clean Air Agency, Environmental Defense, NRDC, U.S. PIRG, and
ALA stated that they understand that section 202(1)(2) requires EPA to look at the costs of the
technology. However, the commenters stated that they believe that the capital costs of the
MSAT2 program are economically reasonable in contrast to refiners' annual profits (about
which the commenters stated ".. .exuberant profits are consistent among most of the nation's
refiners"). The Puget Sound Clean Air Agency further commented that it believes that benefits
to human health far outweigh the costs of less than a few cents per gallon.
Environmental Defense, NRDC, U.S. PIRG, ALA, STAPPA/ALAPCO, Illinois EPA,
and the Florida Department of Environmental Protection also offered specific comments
regarding lower benzene standards (including a per-gallon benzene cap) that EPA should finalize
in order to meet the mandates of CAA section 202(1). Environmental Defense, NRDC, U.S.
PIRG, and ALA also commented that they do not agree with EPA's statements that a per-gallon
benzene cap would not represent the greatest achievable degree of reduction because it would
have to be sufficiently high to accommodate all refiners (70 FR 15865). The commenters noted
that the operative legal language in section 202(1) is not whether stronger standards would be
"challenging," but whether they would be "achievable."
The Independent Fuel Terminal Operators Association (IFTOA) commented that it
believes that the proposal is a reasonable and appropriate means to achieve the statutory
objectives of the Clean Air Act and the Energy Policy Act.
Letters:
ALA OAR-2005-0036-0365 (hearing comments)
Environmental Defense, Natural Resources Defense Council (NRDC), U.S. PIRG, American
Lung Association (ALA) OAR-2005-0036-0868
Engine Manufacturers Association (EMA) OAR-2005-0036-0810
Florida Department of Environmental Protection (FL DEP) OAR-2005-0036-
Illinois Environmental Protection Agency (IL EPA) OAR-2005-0036-0830
Independent Fuel Terminal Operators Association (IFTOA) OAR-2005-0036-1007
Lane Regional Air Protection Agency (LRAPA) OAR-2005-0036-0848
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New Jersey Department of Environmental Protection (NJ DEP) OAR-2005-0036-0829
New York State Department of Environmental Conservation OAR-2005-0036-0722
Northeast States for Coordinated Air Use Management (NESCAUM) OAR-2005-0036-
0993
Oregon Department of Environmental Quality (OR DEQ) OAR-2005-0036-0987
Puget Sound Clean Air Agency OAR-2005-0036-0780
STAPPA/ALAPCO OAR-2005-0036-0836
Our Response:
We considered a range of average benzene standards, taking into account technological
feasibility as well as cost and the other enumerated statutory factors. The commenters
supporting a more stringent average benzene standard did not provide data or analysis to address
the potential negative effects of different standards that we presented in the proposal, especially
in the context of the proposed ABT program. Some of the commenters essentially stated that
because lower annual average levels of benzene are attainable, greater emission reductions are
achievable, and hence the proposal would not comply with section 202(1)(2) if adopted. The
commenters, however, apparently fail to note that "achievable" in section 202(1)(2) is defined not
only in terms of technical capability, but also in reference to cost, energy, safety, and lead time
(see Sierra Club v. EPA, 325 F. 3d at 379). As discussed at length in the preamble and RIA to
both the proposed and final rules, we do not consider a standard with a more stringent annual
average benzene standard to be achievable considering costs, especially when costs to individual
refineries are taken into consideration.
Some commenters that supported a more stringent annual average standard considered
the role of costs and argued that the program does not impose significant costs on refiners in the
aggregate, but did not address the wide range of compliance costs for individual refineries that
we discuss in the proposal. It is critical to recognize that as more stringent annual average
standards are considered, the costs for individual technologically-challenged refineries tend to
become more extreme. (Please see section VI of the preamble to the final rule, chapter 9 of the
RIA, and section 4.4 of this comment response document for a more detailed discussion of the
costs of this program and how EPA considered these costs in determining which standards were
achievable.)
We reassessed the level of the standard in light of the key factors we are required to
consider, and concluded that 0.62 vol% is the appropriate level for the average standard, because
it achieves the greatest achievable emission reductions through the application of technology that
will be available, considering cost, energy, safety, and lead time. We have also chosen to
finalize a maximum average standard. We believe that a maximum average standard at a level of
1.3 vol% accomplishes the reasonable goal of reasonably assuring lower gasoline benzene levels
both nationally and regionally (see section 202(1)(2), authorizing EPA to establish "reasonable
requirements"), while balancing the negative aspects of more- and less-stringent benzene
standards, and avoids the serious drawbacks of a per-gallon cap. As further discussed in section
VI of the preamble to the final rule, chapter 9 of the RIA and responses in chapter 4 of this
comment response document, we do not believe that a per-gallon cap would be achievable within
the meaning of section 202(1)(2).
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7.2.1.2 On-Board Diagnostics
What Commenters Said:
Regarding the mandates of CAA section 202(1), MECA, NESCAUM, and the New Jersey
Department of Environmental Protection (NJ DEP) commented that they believe that EPA
should support inspection and maintenance (I/M) programs and introduce on-board diagnostics
(OBD) for all heavy-duty vehicles (especially those over 14,000 pounds). NESCAUM further
commented that it believes that the final MSAT rule should contain a commitment to heavy-duty
OBD, as it would allow for optimization of combustion in gasoline engines and reduce excess
hydrocarbon emissions. NJ DEP further commented that it believes that EPA's support for I/M
programs, through continually updated and comprehensive technical guidance, will help ensure
the air toxic reductions projected from national exhaust and evaporative emission standards
programs provide the expected benefits.
MECA commented that it believes that the MSAT2 proposal should have also considered
a light-duty gasoline aftermarket converter policy that sets higher performance and durability
standards (similar to California Air Resources Board's (ARE) interim policy requirements for
aftermarket converters used on OBD-equipped vehicles). The commenter noted that, based on
surveys that it performed with aftermarket converter manufacturers, significant additional
reductions of hydrocarbon emissions, including toxic hydrocarbon emissions, andNOx
emissions could be achieved with a national aftermarket converter policy that made use of the
same higher performance OBD-compliant aftermarket converters available in California.
Letters:
Manufacturers of Emission Controls Association (MECA) OAR-2005-0036-0808
New Jersey Department of Environmental Protection (NJ DEP) OAR-2005-0036-0829
Northeast States for Coordinated Air Use Management (NESCAUM) OAR-2005-0036-
0993
Our Response:
With regard to the comments on including heavy-duty OBD standards as part of this rule,
EPA explained at proposal that such standards are being pursued in a separate proceeding (71 FR
15844). EPA in fact proposed OBD requirements for heavy-duty vehicles over 14,000 pounds
(72 FR 3200, January 24, 2007). Given the nature of the heavy-duty trucking industry, 50-state
harmonization of emissions requirements for these vehicles is an important consideration. To
work towards this goal, the Agency signed a Memorandum of Agreement in 2004 with the
California Air Resources Board which expresses both agencies' interest in working towards a
single, nationwide program for heavy-duty OBD. Since that time, California has established
their heavy-duty OBD program, which will begin implementation in 2010. EPA also proposed a
2010 implementation date for its program. We believe that it is far more sensible to continue to
coordinate these requirements by means of an independent rulemaking proceeding, than to
disrupt the process by trying to 'shoehorn' heavy-duty OBD requirements into this rulemaking.
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Regarding California high-performance OBD-compliant aftermarket converters, we note
that vehicles already have an 8 year, 80,000 mile emission warranty with a 100,000 to 150,000
full useful life (FUL) for emissions. Therefore, original equipment manufacturer (OEM)
catalysts are already required to be durable and effective for FUL. EPA does not have the
authority to require catalyst changes on properly functioning catalysts even after FUL. However,
for the small amount of catalyst failures that may occur after 80,000 miles, there is an EPA
replacement policy in place that should restore the vehicle to an acceptable emission level.
Finally, with respect to the suggestion to support I/M programs as an aspect of vehicular
toxics control, EPA can and does support such programs. However, I/M programs apply
principally to existing vehicles, and to the extent that they do, cannot be required under the
section 202(1)(2) authority which applies exclusively to new vehicles (Sierra Club v. EPA, 325 F.
3d at 380-82).
7.2.1.3 Heavy-Duty Diesel and Small Spark-Ignited Engines
What Commenters Said:
Environmental Defense, NRDC, U.S. PIRG, ALA, NESCAUM, and NJ DEP commented
that they believe that the MSAT2 program does not fulfill the requirements of section 202(1)
because EPA should have also promulgated standards for heavy-duty diesels such as in-use
highway and nonroad diesel engines and locomotive and marine diesel engines, none of which
were regulated by recent diesel standards. The commenters also noted that the full pollution
reduction and public health benefits of the highway and nonroad diesel rules will not be realized
for twenty years due to the lag in time before the emission standards come into effect and
because of the long life spans of these diesel engines. The commenters stated that they believe
that retrofitting these highly durable vehicles is important to achieving toxic emission reductions
in the near-term. One commenter noted the Urban Bus Retrofit Program, and stated that it
believes that expanding this program would greatly reduce toxic emissions from heavy-duty
trucks and buses. Environmental Defense, NRDC, U.S. PIRG, ALA further commented that
they believe that locomotive and marine engines are two of the most significant sources of the
nation's diesel air pollution. The commenters cited many reports and public comments on
EPA's Advanced Notice of Proposed Rulemaking for locomotive and marine diesels (August 30,
2004).
However, the Engine Manufacturer's Association (EMA) noted that the highway and
nonroad diesel programs will reduce emissions of both NOx and PM by more than 90 percent.
The commenter further stated that it agrees with EPA's assessment that cleaner-burning diesel
fuel, engine improvements, and the addition of diesel paniculate filters and other aftertreatment
devices will significantly reduce MSAT emissions from new diesel engines. The commenter
also cited studies which show that emissions of MSATs from today's advanced diesel engines
are significantly lower than those observed in prior studies. The commenter stated that it
believes that these studies demonstrate that EPA's aggressive rulemaking efforts for PM and
other emissions are already reducing MSAT emissions to the greatest extent feasible. The
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commenter thus stated that it believes that the implementation of these stringent (and
technology-forcing) standards for diesel engines, including the upcoming locomotive and marine
rule, there clearly is not a need for additional engine, vehicle, or fuel controls to reduce MSAT
emissions from diesel engines.
Additionally, EMA commented that it believes that EPA's upcoming proposed
regulations small spark-ignited engines will result in significant emissions reductions for all
pollutants, including MSAT emissions. The commenter stated that, because the emission
reduction technologies that will be employed to reduce criteria pollutant emissions from these
other mobile source sectors are also the best available technology to reduce MSAT emissions,
the commenter believes that no additional controls are needed, or indeed are available, to control
MSAT emissions from those sources. The commenter stated that it believes that EPA correctly
avoids duplicate or redundant regulation of small spark-ignited engines by relying on upcoming
small engine regulation to reduce MSATs; and thus EPA is justified in not proposing specific
controls on small engines in the MSAT proposal.
Letters:
Environmental Defense, Natural Resources Defense Council (NRDC), U.S. PIRG, American
Lung Association (ALA) OAR-2005-0036-0868
Engine Manufacturers Association (EMA) OAR-2005-0036-0810
New Jersey Department of Environmental Protection (NJ DEP) OAR-2005-0036-0829
Northeast States for Coordinated Air Use Management (NESCAUM) OAR-2005-0036-
0993
Our Response:
With regard to comments that EPA did not fulfill the CAA requirements because of the
omission of in-use highway and nonroad diesel engines, locomotive and marine engines, and
small SI engines, we note first that CAA section 202(1) applies to "motor vehicles and motor
vehicle fuels." Nonroad diesel engines, locomotive and marine engines, and equipment using
small SI engines are not "motor vehicles" (see CAA section 216(2), definition of "motor
vehicle"). Second, the commenter may well be correct that retrofits of existing diesel engines
could achieve significant emission reductions. However, again, section 202(1)(2) provides no
authority to compel those retrofits since it does not apply to in-use engines (Sierra Club v. EPA,
325 F. 3d at 381-82). Finally, for those diesel engines which are included within the scope of
section 202(1), we adhere to our findings that existing vehicle-based controls represent the
greatest emission reductions achievable. We further agree with the EMA comment making
essentially this point. With respect to diesel fuel, we also adhere to our findings at proposal that
the existing controls on sulfur levels represent the greatest achievable reductions.
7.2.1.4 Technology Forcing Standards
What Commenters Said:
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The Energy Future Coalition (EFC) commented that it believes that EPA failed in its
statutory duty to set standards that control hazardous air pollutants from motor vehicles to the
maximum extent that is reasonably achievable. The commenter believes that EPA ignored an
available option that is cost-effective and in use today - the replacement of aromatic compounds
in gasoline with liquid biofuels. The commenter stated that it believes that EPA's approach of
only reducing benzene emissions from gasoline is a limited measure that does not satisfy the
requirements of the Clean Air Act, which it stated requires ("at a minimum") reductions in
emissions of benzene and formaldehyde plus additional reductions in other air toxics that reflect
the "greatest degree of emissions reductions achievable through the application of technology
which will be available," taking cost, noise, energy, safety, and lead times into account. The
commenter stated that the CAA requirements do not mandate the least costly degree of emission
reduction; rather, it mandates the greatest degree of reduction possible, taking costs and other
factors into account. The commenter also noted that the CAA provision is "technology-forcing"
because it requires, not just the best current technology can do today, but the best that it can do in
the future.
The American Petroleum Institute (API) and the National Petrochemical and Refiners
Association (NPRA) commented that they believe that the EFC's comments primarily rest upon
the premise that the operative portion of the Clean Air Act section 202(1) is that the standard
should achieve "the greatest degree of emissions reduction achievable through the application of
technology which will be available" and that the section is a "technology-forcing" provision.
The commenters noted that in section 202 Congress required regulations to contain "reasonable
requirements to control hazardous air pollutants from motor vehicle fuels" through "standards for
such fuels or vehicles or both, which.. .reflect the greatest degree of emissions reduction
achievable through the application of technology which will be available, taking into
consideration.. .the availability and costs of the technology, and noise, energy, safety factors, and
lead time." The commenters stated that they believe that the EFC has taken a selective reading
of the legislation and fails to recognize the fact that EPA is to take all of these items into
consideration. The commenters also noted that this same argument was raised in a legal
challenge to the MS ATI rule, and that in response to this argument, the court stated:
"...petitioners point out that section 202(1) is 'technology-forcing,' so that the agency must
consider future advances in pollution control capability.. .The statute also intends the agency to
consider many factors other than pure technological capability, such as costs, lead time, safety,
noise and energy." Thus, the commenters noted that, contrary to the EFC's assertion regarding
the mandates of section 202(1), the Court of Appeals for the DC Circuit has ruled that this is but
one of several factors that the Agency must consider when promulgating standards under section
202(1).
Letters:
API & NPRA OAR-2005-0036-1015
Energy Future Coalition OAR-2005-0036-0840
Our Response:
As explained in detail in section VI of the preamble, chapter 9 of the RIA, and other
comment responses in chapter 4 of this document, there are strong reasons not to adopt controls
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on aromatics as part of this rulemaking. In this regard, we find persuasive points raised by the
petroleum industry in its reply comments on this issue.
7.2.2 Section 211(c)(4)- State Pre-emption in Fuels Regulations
What Commenters Said:
The New York State Department of Environmental Conservation noted that Clean Air
Act Section 21 l(c) only allows states some flexibility in regulating fuels, and that it does not
believe that it should be preempted from the regulation of gasoline benzene content. The New
Jersey Department of Environmental Protection further noted that states are preempted by
section 21 l(c)(4) from taking additional action in regulating gasoline benzene, and it urged EPA
to maximize the opportunity to glean the greatest benzene reductions possible.
In contrast, Marathon Petroleum Company (MFC) and the National Petrochemical and
Refiners Association (NPRA) commented that they believe that the Clean Air Act federal
preemption provisions help preserve the national motor fuel supply because states are precluded
from adoption of unique specifications unless EPA grants a waiver.
Letters:
Marathon Petroleum Company LLC (MFC) OAR-2005-0036-1008
National Petrochemical & Refiners Association (NPRA) OAR-2005-0036-0809
New Jersey Department of Environmental Protection, Division of Air Quality (NJ DEP) OAR-
2005-0036-0829
New York State Department of Environmental Conservation (NYDEC) OAR-2005-0036-
0722
Our Response:
Since the implementation of the RFG program, several states and localities have made
their own unique fuel property requirements in an effort to further improve air quality. As a
result, by summer 2004 the gasoline distribution and marketing system in the U.S. had to
differentiate between more than 12 different fuel specifications when storing and shipping fuels
between refineries, pipelines, terminals, and retail locations. These unique fuels decrease
nationwide fungibility of gasoline, which can lead to local supply problems and amplify price
fluctuations. We believe that a nationwide benzene standard can help to alleviate the problems
that tend to occur with proliferation of "boutique fuel" programs.
7.2.3 Other Clean Air Act Sections
7.2.3.1 Sections 202(a)(4) and 206(a)(3)
What Commenters Said:
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The New York State Department of Environmental Conservation commented that it
believes that EPA did not utilize information that is, or should be, available to the Agency
through reporting under CAA sections 202(a)(4) and 206(a)(3).
Letters:
New York State Department of Environmental Conservation OAR-2005-0036-0722
Our Response:
EPA believes that it has comprehensively examined and analyzed existing data relevant
to all of the standards adopted in the rule, as well as to other potential standards.
7.2.3.2 Section 21 l(k)(8)
What Commenters Said:
The New York State Department of Environmental Conservation commented that they do
not believe that EPA can eliminate the conventional gasoline (CG) anti-dumping provisions as
proposed because Clean Air Act section 21 l(k)(8) prohibits EPA from eliminating these
provisions. The commenter noted that in the preamble (71 FR 15871) it was stated that the
proposed rule would preempt state regulation of gasoline benzene content; the commenter stated,
however, that it does not believe that EPA can use preamble language to preempt state authority
to regulate.
Letters:
New York State Department of Environmental Conservation OAR-2005-0036-0722
Our Response:
We note that EPA is not eliminating these requirements—the statutory anti-dumping
requirements remain. EPA continues to find, however, that the anti-dumping requirement is met
by satisfying the final MSAT2 rule (along with satisfying gasoline sulfur requirements from the
Tier 2 Gasoline Sulfur rule). Thus, the anti-dumping requirements will be met by these rules
(and EPA therefore will continue meeting the mandates of section 21 l(k)(8) in issuing
regulations that implement statutory anti-dumping requirements). In this sense, the final MSAT
2 rule implements not only section 202(1)(2), but section 21 l(k)(8) as well.
7.2.3.3 Section 211(1)
What Commenters Said:
The Alliance of Automobile Manufacturers (the Alliance) commented that it believes that
EPA should update the fuel additive regulations under section 211(1) of the Clean Air Act, to
achieve the additional MSAT reductions sought in this proposed rule, to further control deposits
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in the port fuel injector area, intake valve area and combustion chamber. The commenter noted
that section 211(1) requires EPA to establish specifications for additives that will provide
sufficient detergency in gasoline "to prevent the accumulation of deposits in engines or fuel
supply systems," which can have a pronounced impact on emissions at 20°F (and other
temperatures) and vehicle performance. The commenter noted that EPA adopted requirements in
1995 to help control deposits on port fuel injectors (PFID) and intake valves (IVD); the
commenter believes that the requirements need to be updated because they are based on 1986
vehicle technology, and are inconsistent with more stringent emissions standards adopted since
1986. The commenter also cited Coordinating Research Council (CRC) studies of commercial
gasoline in Florida, which have shown substandard levels of detergency based on poor PFID
additive performance and that the additive levels required by EPA's regulations are inadequate to
provide optimum emission performance.
Letters:
Alliance of Automobile Manufacturers (Alliance) OAR-2005-0036-0881
Our Response:
The commenter did not maintain that additive controls would result in any further
emission reductions than would be achieved under the vehicle-based cold temperature NMHC
standard we are adopting in this rule. The comment is more directed at shifting the burden by
which that standard would be satisfied. The potential need for EPA's gasoline deposit
requirements to be amended is beyond the scope of this rulemaking; however, to the extent that
such an amendment may be needed, it will be considered in another rulemaking.
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8. OTHER/MISCELLANEOUS COMMENTS
What We Proposed:
The items raised in the following comments were not all specifically proposed in the
NPRM, and therefore do not necessarily have a corresponding NPRM section. However, for
comments concerning other upcoming EPA regulatory programs, please see sections V.D and
V.G of the preamble to the proposed rule for more information.
8.1 Public Comment Period
What Commenters Said:
We received comments regarding the length of the public comment period for the
MSAT2 rule. Commenters generally stated that they believed that a 60-day comment period was
insufficient for a rule of this size with such a highly complex and technical nature. The
commenters stated that they would find it difficult to fully review and provide written comments
in the timeframe that was provided. Thus, these commenters stated that the comment period
should have been extended to 90 days.
The New York State Department of Environmental Conservation (NYDEC) also
commented on specific factors that it believes led to need for more time: there was no Advanced
Notice of Proposed Rulemaking to allow a prior view of the EPA's intentions, many of the
technical documents cited in the DRIA had never been released to the public prior to the March
29, 2006 Federal Register notice (i.e., there was no previous opportunity to study and analyze the
reports), and the public docket contained 610 documents as of March 30, 2006.
Letters:
New York State Department of Environmental Conservation (NYDEC) OAR-2005-0036-
0362, 0722
Vermont Air Pollution Control Division OAR-2005-0036-0444
American Petroleum Institute (API) OAR-2005-0036-0366, 0367
Our Response:
We appreciate that commenters wanted as much time as possible to adequately review
the proposal and be able to provide comments. However, due to the fact that the rulemaking
schedule is on a court-ordered timeline, we were only able to provide 60 days for public
comments in order for us to then assess those comments and complete the final rule on time. All
of these commenters, and many others, provided robust, detailed, pointed, and helpful comments
on the proposed rule. EPA does not believe any commenter was prejudiced by the 60-day period
for submitting public comment. We also note that pre-publication versions of the proposed rule
and preamble were posted on EPA's website on February 28 (the day of the proposed rule's
signing), so that commenters had more than 60 days to prepare comments on critical aspects of
the proposed rule.
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8.2 Comments Outside the Scope of the Proposal
8.2.1 Mileage Standards and Flex-Fuel Vehicles
What Commenters Said:
The Regional Air Pollution Control Agency (RAPCA) commented that it urges EPA to
consider raising the mileage standards for automobile fleets, as it believes this would have a
positive impact on concentrations of MSATs, energy security, and greenhouse gas emissions.
The commenter also urged EPA to consider mandating increased availability of the Flex-Fuel
vehicle (FFV) fleet and adequate numbers of bio-fuel pumps at gasoline service stations, as it
believes that the increased usage of oxygenates reduce MSATs in exhaust and the oxygenates
will help reduce ozone.
Letters:
Regional Air Pollution Control Agency (RAPCA) OAR-2005-0036-0771
Our Response:
These comments are outside the scope of the MSAT2 program. We appreciate the
commenter's concern. However, EPA does not have the authority to require such actions. Only
Congress has the authority to change mileage standards (Corporate Average Fuel Economy, or
CAFE) and mandating increases in FFVs and bio-fuels. Regarding the comments on spark-
ignited engines, we note that equipment using such engines are not "motor vehicles" and
therefore are not subject to section 202(1)(2). In any case, EPA intends to propose regulations for
these types of engines by mid-2007.
8.2.2 Spark-Ignited Engines
What Commenters Said:
STAPPA/ALAPCO commented that they urge EPA to capitalize on opportunities to
reduce MSATs from nonroad spark-ignited engines in addition to gasoline.
MECA noted that EPA is currently developing the next set of exhaust and evaporative
emission standards for spark-ignited engines used in non-handheld equipment. The commenter
urged EPA to complete this rulemaking process as soon as possible, and harmonize emission
standards for this class of engines with those standards already in place in California for Class I
and Class II nonroad engines and California's 2008 exhaust emission standards for sterndrive
and in-board marine engines. The commenter stated that it believes that further lowering of
hydrocarbon exhaust emission standards for all of these engines can provide additional
significant reductions to toxic hydrocarbon emissions across the U.S.
Letters:
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Manufacturers of Emission Controls Association (MECA) OAR-2005-0036-0808
STAPPA/ALAPCO OAR-2005-0036-0836, -0378
Our Response:
Nonroad engines are not "motor vehicles" as defined in section 216(2) of the CAA, and
so are not within the scope of section 202(1)(2). (See also section 216(10) defining nonroad
engines as "an internal combustion engine ... that is not used in a motor vehicle".) This
comment is consequently beyond the scope of this proceeding.
8.2.3 Stage I Controls
What Commenters Said:
STAPPA/ALAPCO, the Florida Department of Environmental Protection, and the Illinois
EPA commented that they are very concerned with regulation of mobile source air toxics
emissions and encouraged EPA to consider additional measures for controlling fugitive
emissions in the gasoline distribution system. The commenters urged EPA to consider making
Stage I controls mandatory at gasoline stations to reduce emissions from the refueling of
underground storage tanks.
Letters:
Florida Department of Environmental Protection, Bureau of Air Monitoring and Mobile Sources
OAR-2005-0036-0770
Illinois Environmental Protection Agency (IL EPA) OAR-2005-0036-0830
STAPPA/ALAPCO OAR-2005-0036-0836, -0378
Our Response:
Stage I controls are pipes and hoses installed to collect and transfer vapors (which are
generated during the loading of gasoline into an underground tank, or exist in the tank and are
displaced out a vent to the air) back into the tank truck tank. Then, the vapors travel back to
where the truck is loaded and the vapors are recovered or destroyed. Stage I vapor balance
systems are used in ozone non-attainment areas to reduce volatile organic compound emissions.
EPA has evaluated the use and need for Stage I vapor balance system for air toxics, including the
recovered product value. EPA proposed standards (71 FR 66064, November 9, 2006) that would
require that service stations in urban areas to use submerged fill pipes to reduce the amount of
gasoline vapor generated during the loading of the storage tank. In the proposal, EPA
specifically requested public comment on the need to require vapor balancing. Additionally,
emission controls are being proposed for the other facilities that transfer and store gasoline
between the refinery and end user. These controls were proposed under the authority of Clean
Air Act sections 112(c)(3) and (k)(3)(B).
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8.2.4 Fuel Quality
What Commenters Said:
The Alliance of Automobile Manufacturers (Alliance) commented that EPA has not
addressed the role that fuel quality plays in NMHC emissions and vehicle performance. The
commenter stated that due to vehicle hardware considerations coupled with the high variability
in fuel quality, compliance with the proposed 20° F NMHC standard will be a greater challenge
than the low temperature CO standards. The commenter stated that the high variability in winter
and shoulder season gasoline volatility, and variability in gasoline parameters (e.g., RVP, T10,
and T50) could drive significant hardware changes in some engine families; further;
manufacturers may also find it difficult to calibrate vehicles to strict cold temperature emissions
standards as a result. The commenter noted that the auto industry commented on how poor
volatility increases NMHC emissions in its 1999 petition to EPA, which urged the Agency to cap
the Distillation Index (DI) at 1200 and enforce a minimum T50 limit of 170°F.
The commenter stated that it believes EPA should consider regulatory action to control
the variability of gasoline during the winter months and shoulder seasons impacted by the
MSAT2 rulemaking. The commenter further stated that a 1200 DI cap is needed to ensure that
vehicles and fuels work more effectively as a system, and also that some type of volatility
control would be needed for this proposed standard. The commenter stated that it believes that
increased control of cold-start toxic emissions will be difficult for some packages absent stricter
gasoline volatility standards. The commenter lastly stated that additional research is needed on
the proper winter fuel volatility before the proposed NMHC standard can be adopted, and there is
a chance that emissions could increase rather than decrease if this is not done.
The Alliance also commented that EPA should update the fuel additive regulations under
CAA section 211(1), and that controlling distillation, sulfur, and detergency should be
accomplished at the federal level.
Letters:
Alliance of Automobile Manufacturers (Alliance) OAR-2005-0036-0881
Our Response:
We did not propose any changes to gasoline fuel quality other than benzene content.
Although we discussed the potential for sulfur and/or RVP changes to generate reductions in
MSAT emissions, we did not discuss potential changes in other fuel properties such as volatility.
The commenter did not provide any information indicating that compliance with the 20° F
NMHC standard cannot be attained without greater controls on gasoline volatility, nor did it
provide any indication that new controls on volatility or DI would generate cost-effective
reductions in MSATs. Any impacts of new controls on volatility, DI, or detergents on emissions
of other pollutants or on fuel-vehicle system efficiency is outside the scope of this rulemaking.
We believe that manufacturers can design their vehicles to accommodate the variation in
fuel quality for in-use fuels while still meeting the cold temperature NMHC standard in this final
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rule. The commenter provided no conclusive data to the contrary. For a further discussion on
this comment, see section 4.7 of this Summary and Analysis document.
8.2.5 Remote Sensing Program for "Super-emitters"
What Commenters Said:
RAPCA commented that it believes that new vehicle standards have little effect on
"super-emitters" (mobile sources that are old or ill-maintained, or both) which have a
disproportionate impact on the MS AT problem. The commenter stated that one of the
difficulties of inspection and maintenance (I/M) programs is their patchwork application and
perceived inequities. The commenter thus urged EPA to promulgate a national remote sensing
program to identify and mitigate the impact of these "super-emitters."
Letters:
Regional Air Pollution Control Agency (RAPCA) OAR-2005-0036-0771
Our Response:
Although this is an interesting comment, it is essentially beyond the scope of this
rulemaking. Section 202 (1) provides no authority over vehicles already on road (Sierra Club v.
EPA, 325 F. 3d at 380-82), and so cannot prescribe controls over the "super-emitters" of concern
to the commenter.
8.3 Other Comments
What Commenters Said:
NESCAUM commented that it does not believe that EPA has completed the analysis
which was outlined in the 2001 MS AT rule (MS ATI). For improved understanding of
effectiveness and costs of control strategies, the commenter believes EPA needs to consider fully
all cost-effective control measures for the final rule.
Anchorage commented that though it promotes block heater use through federally-funded
advertising and block heater installation, Anchorage air is significantly impacted by cold-start
vehicle emissions. The commenter noted that the 2000 carbon monoxide (CO) inventory
attributes as much as 43% of CO in some Anchorage neighborhoods to cold start emissions
during the morning period. The commenter also noted that sampling at State and Local Air
Monitoring Stations (SLAMS) in past winters shows a close correlation between benzene and
CO concentrations, and that CO is a useful indicator of other products of incomplete combustion
including such pollutants as 1,3-butadiene, acrolein, and poly cyclic aromatic matter. Lastly, the
commenter stated that occasional winter periods of poor atmospheric mixing can hinder
dispersion of these emissions.
8-5
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Letters:
Municipality of Anchorage, Department of Health and Human Services (Anchorage) OAR-
2005-0036-0976
National Petrochemical Refiners Association (NPRA) OAR-2005-0036-0809
New York State Department of Environmental Conservation (NYDEC) OAR-2005-0036-
0722
NESCAUM (Northeast States for Coordinated Air Use Management) OAR-2005-0036-
0993
Our Response:
With regard to comments regarding data gaps noted by EPA in the MS ATI rulemaking,
EPA has conducted extensive analyses of toxic emissions from nonroad compression and spark
ignition engines to meet commitments as part of the technical analysis plan (albeit these engines
would not be covered by any section 202(1) since they are not associated with "motor vehicles",
as noted above). Section 2.3 of the RIA discusses recent nonroad emission test programs and
plans to integrate data from these programs into the NMIM model. In addition, EPA has made
substantial progress in better characterizing air toxics exposure in microenvironments, as well as
the total range of exposures, and the Agency's progress in this area is discussed in Chapter 3 of
the RIA. The national scale analyses conducted for the final rule use the new HAPEM6 model,
which models better accounts for elevated near road exposures. In addition, EPA has
comprehensively evaluated potential vehicle and fuel controls under its section 202(1)(2)
authority, and the result of these analyses have been the fuel benzene and cold temperature
hydrocarbon emission standards adopted in this rule. As previously noted, EPA is addressing
toxic emissions from small spark ignition engines, and locomotive and marine engines under
separate statutory authorities, and in the future will continue to work on finding additional
strategies to further reduce mobile source air toxics.
With regard to the comment on cold start emissions in Anchorage, we note that the
emission control approaches that will be used in vehicles to meet the finalized MSAT2 NMHC
standards are expected to also result in reductions in CO and other products of incomplete
combustion.
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