EPA Proposes 2011  Renewable Fuel
                      Standards
                      Introduction
                      Under the Clean Air Act Section 211 (o), as amended by the Energy Independence
                      and Security Act of 2007 (EISA), the Environmental Protection Agency (EPA) is
                      required to set renewable fuel standards each November for the following year based
                      on gasoline and diesel projections from the Energy Information Administration
                      (ElA). EPA is also required to set the cellulosic biofuel standard each year based
                      on the volume projected to be available during the following year, using EIA
                      projections and assessments of production capability from industry. This regulatory
                      action proposes these annual standards for cellulosic, biomass-based diesel, advanced
                      biofuel, and total renewable fuels that apply to all gasoline and diesel produced
                      or imported in year 2011. This notice also includes two proposed changes to the
                      RFS2 regulations. The first would create a temporary and limited means for certain
                      renewable fuel producers to generate delayed Renewable Identification Numbers
                      (RINs) after they have produced and sold renewable fuel. This proposal would apply
                      only to those producers who use canola oil, grain sorghum, pulpwood, or palm oil to
                      produce renewable fuel. The second proposal would establish a petition process that
                      foreign countries could use to establish an aggregate approach to compliance with
                      the renewable biomass provision akin to that applicable to the U.S.
                      General Background
                      EPA is required to determine and publish the applicable annual percentage standards
                      for each compliance year by November 30 of the previous year. Determining the
                      applicable standards under RFS2 requires EPA to conduct an in-depth evaluation
                      of the volume of qualifying cellulosic biofuel that can be made available in the
                      following year. If the projected available volume of cellulosic biofuel is less than
                      the required volume specified in the statute, EPA must lower the required volume
                      used to set the annual cellulosic biofuel percentage standard to the projected
                      available volume. EPA must also determine whether the advanced biofuel and/or
                      total renewable fuel volumes should be reduced by the same or a lesser amount. The
                      proposed rule provides EPA's evaluation of the projected production of cellulosic
                      biofuel for 2011, and proposed percentage standards for compliance year 2011,
SEPA
United States
Environmental Protection
Agency
Office of Transportation and Air Quality
                   EPA-420-F-10-043
                          July 2010

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Proposed Percentage Standards for 2011
To calculate the percentage standard for cellulosic biofuel for 2011, we have used a potential
volume range of 6.5 - 25.5 million ethanol-equivalent gallons (representing 5 - 17.1 million
physical gallons). For the final rule, EPA intends to pick a single value from within this range to
represent the projected available volume on which the 2011 percentage standard for cellulosic
biofuel will be based. We are also proposing that the applicable volumes for biomass-based
diesel, advanced biofuel, and total renewable fuel for 2011 will be those specified in the statute.
These volumes are shown in Table 1,

                                       Table 1
                              Proposed Volumes for 2011

Cellulosic biofuel
Biomass-based diesel
Advanced biofuel
Renewable fuel
Actual Volume
5-17.1 mill gal
0.80 bill gal
1.3 5 bill gal
13. 95 bill gal
Ethanol Equivalent Volume
6.5 -25. 5 mill gal
1.20 bill gal
1.3 5 bill gal
13. 95 bill gal
Four separate standards are required under the RFS2 program, corresponding to the four separate
volume requirements shown in Table 2. The percentage standards represent the ratio of renew-
able fuel volume to non-renewable gasoline and diesel volume. The proposed standards for 2011
are shown in Table 2,
                                       Table 2
                         Proposed Percentage Standards for 2011
Cellulosic biofuel
Biomass-based diesel
Advanced biofuel
Renewable fuel
0.004-0.015%
0.68%
0.77%
7.95%
Delayed RIN Generation for New Pathways
EPA is proposing a new regulatory provision that would provide a means for certain renewable
fuel producers to generate RINs after they have produced and sold renewable fuel. This proposed
provision for "Delayed RINs" would apply only to those producers who use canola oil, grain
sorghum, pulpwood, or palm oil to produce renewable fuel, only for renewable fuel produced in
2010, and only if EPA determines that fuel pathways using these feedstocks provide the required
greenhouse gas reductions as compared to baseline fuels. The greenhouse gas (GHG) lifecycle
impacts of these four feedstocks are currently being analyzed as a supplement to the RFS2 final
rule and are expected to be completed in 2010,

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Criteria and Process for Adoption of Aggregate Approach to Renewable
Biomass for Foreign Countries
In the final RFS2 rulemaking, EPA indicated that there was not enough data at that time to
determine if the aggregate compliance approach adopted for domestically-grown crops and crop
residues would be appropriate for foreign-grown feedstocks. EPA is now proposing criteria for
EPA to use to determine whether or not to allow renewable fuel producers using foreign-grown
feedstocks to use an aggregate approach to compliance with the renewable biomass verification
provisions. The proposal includes a number of considerations that EPA will use in evaluating
petitions. The proposal also describes the process EPA would follow to make decisions on any
petitions received.
Public Participation Opportunities
We welcome your comments on this proposed rule. Comments will be accepted for 30 days
beginning when this proposal is published in the Federal Register. All comments should be
identified by Docket ID No. EPA-HQ-OAR-2010-0133 and submitted by one of the following
methods:

         Internet: www.regulations.gov
         E-mail: A-and-R-Docket@epa.gov
         Mail:
            Environmental Protection Agency
            Air and Radiation Docket and Information Center (6102T)
            1200 Pennsylvania Avenue NW
            Washington, DC 20460
         Hand Delivery:
            EPA West Building
            EPA Docket Center (Room 3340)
            1301 Constitution Avenue NW
            Washington, DC

We do not expect to hold a public hearing. However, if we receive such a request we will publish
information related to the timing and location of the hearing and the timing of a new deadline
for public comments.
For More Information
For more information on this proposal, please visit the RFS website at:
         http://www.epa.gov/otaq/fuels/renewablefuels

To submit a question on the RFS program, and to view Frequently Asked Questions, please visit:
         www.epa.gov/otaq/fuels/renewablefuels/compliancehelp/index.htm

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